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Globalstar 8-K 2013

 

Exhibit 10.3

 

 

Dated 5 June 2009

as amended and restated on 21 August 2013

 

COFACE Facility Agreement

 

 between

 

Globalstar, Inc.

as Borrower,

 

BNP Paribas

Société Générale

Natixis

Crédit Agricole Corporate and Investment Bank

Crédit Industriel Et Commercial

as Mandated Lead Arrangers,

 

BNP Paribas

as the Security Agent

and the COFACE Agent

 

and

 

The Banks and Financial Institutions

listed in Schedule 1

as the Original Lenders

 

White & Case LLP

5 Old Broad Street

London EC2N 1DW

 

 
 

 

Table of Contents

 

    Page
     
1. Definitions and Interpretation 1
2. The Facilities 46
3. Purpose 47
4. Conditions of Utilisation 48
5. Utilisation 50
6. Repayment 53
7. Prepayment and Cancellation 53
8. Interest 61
9. Interest Periods 61
10. Changes to the Calculation of Interest 62
11. Fees 63
12. COFACE Insurance Premia and COFACE Additional Insurance Premium 65
13. Tax gross-up and Indemnities 67
14. Increased Costs 71
15. Other Indemnities 73
16. Mitigation by the Lenders 74
17. Costs and Expenses 75
18. Representations 76
19. Information Undertakings 86
20. Financial Covenants 96
21. Positive Undertakings 102
22. Negative Undertakings 114
23. Events of Default 124
24. Remedies Upon an Event of Default 130
25. Security 131
26. Changes to the Lenders 131
27. Changes to the Borrower 137
28. Role of the COFACE Agent, the Security Agent and the Mandated Lead Arrangers 137
29. Conduct of Business by the Finance Parties 144
30. Sharing among the Finance Parties 144
31. Payment Mechanics 146
32. Set-off 150
33. Notices 150
34. Calculations and Certificates 152
35. Partial Invalidity 152

 

(i)
 

 

    Page
     
36. Remedies and Waivers 152
37. Amendments and Waivers 153
38. Counterparts 155
39. Governing Law 155
40. Enforcement 155
41. Confidentiality 156
42. Subrogation and Reimbursement 158

 

Schedule 1 Lenders and Commitments 160
Part 1   Facility A 160
Part 2   Facility B 161
Schedule 2 Conditions Precedent 162
Schedule 3 Utilisation Request 169
Schedule 4 Maximum Covenant Capital Expenditure 171
Part A Maximum Covenant Capital Expenditures 171
Part B Maximum Covenant Capital Expenditures for Excess Cash Flow Calculation 172
Schedule 5 Form of Transfer Certificate and Assignment Agreement 173
Part A Form of Transfer Certificate 173
Part B Form of Assignment Agreement 175
Schedule 6 The Security Agent 178
Schedule 7 Know Your Customer Requirements 182
Schedule 8 Form of Compliance Certificate 183
Schedule 9 ERISA Plans 185
Schedule 10 Form of Confidentiality Undertaking 186
Schedule 11 Payment Terms 190
Schedule 12 Material Contracts 191
Schedule 13 Labour and Collective Bargaining Agreements 195
Schedule 14 Financial Indebtedness and Guarantee Obligations 196
Schedule 15 Communication Licences 197
Schedule 16 Satellites 200
Schedule 17 Existing Liens 202
Schedule 18 Qualifying Certificate 204
Schedule 19 Key Performance Indicators 206
Schedule 20 Transactions with Affiliates 207
Schedule 21 Existing Loans, Investments and Advances 210
Schedule 22 Incentive Plan 211
Schedule 23 Group Structure Chart 212

 

(ii)
 

 

    Page
     
Schedule 24 Disclosures 213
Schedule 25 Form of Promissory Note 214
Schedule 26 Subsidiary Guarantors 215
Schedule 27 Investment Policy 216
Schedule 28 Loss Payee Clause 218
Schedule 29 Repayment Schedule 219
Schedule 30 Form of Quarterly Health Report 220
Part 1   Satellite Status 220
Part 2   Band Status 221
Part 3   Material Events 222
Schedule 31 Satellite Performance Criteria 223
Schedule 32 Form of Auditors Report 224

 

(iii)
 

  

This Agreement (the “Agreement”) is dated 5 June 2009 (as amended and restated on 21 August 2013 by the Global Deed of Amendment and Restatement) and made

 

Between:

 

(1)Globalstar, Inc., a corporation duly organised and validly existing under the laws of the State of Delaware, with its principal office located at 300 Holiday Square Boulevard, Covington, LA 70433, United States of America (the “Borrower”);

 

(2)BNP Paribas, a société anonyme with a share capital of €2,488,925,578 organised and existing under the laws of the Republic of France, whose registered office is at 16 boulevard des Italiens, 75009 Paris, France registered under number 662 042 449 at the Commercial Registry of Paris, acting in its capacity as facility agent and Chef de File for and on behalf of the Finance Parties (the “COFACE Agent”);

 

(3)BNP Paribas, Societe Generale, Natixis, Crédit Agricole Corporate and Investment Bank (formerly known as Calyon) and Crédit Industriel et Commercial each acting in its capacity as a mandated lead arranger (the “Mandated Lead Arrangers”);

 

(4)BNP Paribas, a société anonyme with a share capital of €2,488,925,578 organised and existing under the laws of the Republic of France, whose registered office is at 16 boulevard des Italiens, 75009 Paris, France registered under number 662 042 449 at the Commercial Registry of Paris, acting in its capacity as the security agent (the “Security Agent”); and

 

(5)The Financial Institutions listed in Schedule 1 (Lenders and Commitments) as lenders (the “Original Lenders”).

 

1.Definitions and Interpretation

 

1.1Definitions

 

In this Agreement:

 

2013 Closing Commitment” means the equity commitment made by Thermo in respect of the Borrower on or prior to the Effective Date pursuant to the Restructuring Support and Consent Agreement in an aggregate amount of cash equal to US$20,000,000 less the aggregate amount of cash actually received by the Borrower in connection with the Initial Minimum Cash Commitment (as such amount may be reduced by the amount of any proceeds received by the Borrower from any financing pursuant to third party Equity Issuances (but excluding any Equity Issuance involving Terrapin)).

 

2013 Year-End Commitment” means the equity commitment made or to be made by Thermo or any other member of the Thermo Group in respect of the Borrower pursuant to the Global Deed of Amendment and Restatement or the Thermo Group Undertaking Letter (as the case may be) to be funded on or prior to 26 December 2013 as a condition precedent to the entry into Guarantee Obligations by the Subsidiary Guarantors under Clause 22.1(1) (Limitations on Financial Indebtedness), in an aggregate amount of cash equal to US$20,000,000 (as such amount may be reduced by the amount of any proceeds received by the Borrower from any financing pursuant to third party Equity Issuances (but excluding any Equity Issuance involving Terrapin)).

 

2014 Anticipated Equity Financing” means the equity commitment made or to be made by Thermo or any other member of the Thermo Group in respect of the Borrower pursuant to the Global Deed of Amendment and Restatement or the Thermo Group Undertaking Letter (as the case may be) to be funded on or prior to 31 December 2014 in an aggregate amount of cash equal to US$20,000,000 less the amount by which the amount of cash actually received by the Borrower in connection with the Initial Minimum Cash Commitment, the 2013 Closing Commitment and the 2013 Year-End Commitment exceeds US$40,000,000 (as such amount may be reduced by the amount of any proceeds received by the Borrower from any financing pursuant to third party Equity Issuances (but excluding any Equity Issuance involving Terrapin)).

 

 
 

 

5% Notes” means the 5% convertible senior unsecured notes issued by the Borrower pursuant to the Original Indenture as supplemented by the third supplemental indenture dated as of 14 June 2011.

 

5.75% Notes Term Sheet” means the term sheet attached as schedule 1 to the Restructuring, Support and Consent Agreement in respect of the restructuring of the 5.75% notes which were exchanged or redeemed in full by the Borrower on or prior to 26 June 2013.

 

8% New Notes” means the 8% convertible senior notes issued by the Borrower pursuant to the Original Indenture as supplemented by the Fourth Supplemental Indenture.

 

8% Old Notes” means the 8% convertible senior unsecured notes issued by the Borrower pursuant to the Original Indenture as supplemented by a second supplemental indenture dated 19 June 2011.

 

Acceptable Bank” means:

 

(a)a bank or financial institution which has a rating for its long-term unsecured and non credit-enhanced debt obligations of AA- or higher by S&P or Fitch Ratings Ltd or Aa2 or higher by Moody’s or a comparable rating from an internationally recognised credit rating agency;

 

(b)Union Bank, provided that, it has a rating for its long-term unsecured and non credit-enhanced debt obligations of A or higher by S&P or A+ by Fitch Ratings Ltd or a comparable rating from an internationally recognised credit rating agency; or

 

(c)any other bank or financial institution approved by the COFACE Agent.

 

Acceptable Intercreditor Agreement” means an intercreditor agreement in form and substance satisfactory to the COFACE Agent to be entered into by the Borrower or any Subsidiary (as the case may be), the COFACE Agent (unless the COFACE Agent agrees otherwise) and the relevant provider of Subordinated Indebtedness. Such Acceptable Intercreditor Agreement shall include, without limitation, the following provisions, whereby the relevant Subordinated Indebtedness provider shall agree not to:

 

(a)seek direct or indirect recovery, payment or repayment of, nor permit direct or indirect payment or repayment of any of the Subordinated Indebtedness or other amounts payable by the Borrower or any Subsidiary (as the case may be) in respect thereof or of any other Subordinated Indebtedness of the Borrower or any Subsidiary (as the case may be);

 

(b)demand, sue for or accept from the Borrower or any Subsidiary (as the case may be) any payment in respect of the Subordinated Indebtedness or take any other action to enforce its rights or to exercise any remedies in respect of any Subordinated Indebtedness (whether upon the occurrence or during the occurrence of an event of default (howsoever described) or otherwise) unless requested to do so by the COFACE Agent;

 

(c)file or join in any petition to commence any winding-up proceedings or an order seeking reorganisation or liquidation of the Borrower or any Subsidiary (as the case may be), or take any other action for the winding-up, dissolution or administration of the Borrower or any Subsidiary (as the case may be) or take, or agree to, any other action which could or might lead to the bankruptcy, insolvency or similar process of the Borrower or any Subsidiary (as the case may be) unless requested to do so by the COFACE Agent; and/or

 

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(d)claim, rank or prove as a creditor of the Borrower or any Subsidiary (as the case may be) in competition with any Finance Party.

 

Account Control Agreement” means:

 

(a)the account control agreement dated 22 June 2009 between the Deposit Account Bank (as such term is defined in each Account Control Agreement), the Borrower and the Security Agent; and

 

(b)any other account control agreement entered into between any other deposit account bank, the Borrower and the Security Agent in form and substance satisfactory to the COFACE Agent.

 

Accounts Agreement” means the accounts agreement dated 5 June 2009 (as amended and restated from time to time including pursuant to the Global Deed of Amendment and Restatement) and, as of the Effective Date, made between the Borrower, the COFACE Agent, the Offshore Account Bank and the Security Agent.

 

Adjusted Consolidated EBITDA” means, for any period, Consolidated EBITDA for such period provided that, for the purpose of calculating the Consolidated Net Income component of Consolidated EBITDA, any cash revenue received in that period but not recognised under GAAP shall be included, plus (in the case of paragraphs (a), (b) and (c) below only, to the extent deducted in the calculation of Consolidated EBITDA (without double-counting)):

 

(a)non-cash stock compensation expenses;

 

(b)non-cash asset impairment charges; and

 

(c)one time non-cash non-recurring expenses,

 

but excluding the proceeds of any Spectrum Cash Flow (save for, to the extent agreed in writing by the COFACE Agent (acting on the instructions of the Majority Lenders), any such proceeds which replace revenue that had otherwise been projected in the then current Agreed Business Plan but which has not been earned due to a change in the strategy of the Group).

 

Adjusted Consolidated EBITDA Reconciliation” means, for any period, a reconciliation statement prepared by the Borrower in a form reasonably acceptable to the COFACE Agent showing a reconciliation of:

 

(a)cash revenue received in that period but not recognised under GAAP, as determined in accordance with the definition of Adjusted Consolidated EBITDA; to

 

(b)revenues recognised for such period, as determined in accordance with GAAP.

 

Advance Payment” means an advance payment:

 

(a)in the case of the Launch Services Contract, of five per cent. (5%) of the total Contract Price payable by the Borrower pursuant to the Launch Services Contract; and

 

(b)in the case of the Satellite Construction Contract, of fifteen per cent. (15%) of the total Contract Price payable by the Borrower pursuant to the Satellite Construction Contract.

 

Affiliate” means, in relation to any person, a Subsidiary of that person or a Holding Company of that person or any other Subsidiary of that Holding Company.

 

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Agreed Business Plan” means the business plan:

 

(a)delivered to the COFACE Agent on or prior to the Effective Date pursuant to paragraph 13 of schedule 3 (Conditions Precedent to the Effective Date) of the Global Deed of Amendment and Restatement; or

 

(b)as updated on an annual basis in accordance with Clause 19.3 (Annual Business Plan and Financial Projections).

 

ANFR” means the Agence Nationale des Fréquences.

 

Applicable Law” means all applicable provisions of constitutions, laws, statutes, ordinances, rules, treaties, regulations, permits, licences, approvals, interpretation and orders of courts or Governmental Authorities and all orders and decrees of all courts and arbitrators.

 

Applicable Margin” means in respect of each Facility for any Interest Period commencing:

 

(a)any time prior to the Effective Date, two point two five per cent. (2.25%) per annum;

 

(b)from the Effective Date and prior to (but excluding) 1 July 2017, two point seven five per cent. (2.75%) per annum;

 

(c)on (and including) 1 July 2017 and ending on 30 June 2018, three point two five per cent. (3.25%) per annum;

 

(d)on (and including) 1 July 2018 and ending on 30 June 2019, three point seven five per cent. (3.75%) per annum;

 

(e)on (and including) 1 July 2019 and ending on 30 June 2020, four point two five per cent. (4.25%) per annum;

 

(f)on (and including) 1 July 2020 and ending on 30 June 2021, four point seven five per cent. (4.75%) per annum;

 

(g)on (and including) 1 July 2021 and ending on 30 June 2022, five point two five per cent. (5.25%) per annum; and

 

(h)on (and including) 1 July 2022 and thereafter, five point seven five per cent. (5.75%) per annum.

 

Applicable Negative Excess Cash Flow” means:

 

(a)for all Payment Periods (except the Second Half 2017 Payment Period), the absolute value of such negative Excess Cash Flow for such Payment Period provided that if such absolute value is greater than US$10,000,000 the Applicable Negative Excess Cash Flow shall be deemed to be US$10,000,000; or

 

(b)for the Second Half 2017 Payment Period, the absolute value of such negative Excess Cash Flow for such Payment Period provided that if such absolute value is greater than US$25,000,000 the Applicable Negative Excess Cash Flow shall be deemed to be US$25,000,000.

 

Asset Disposition” means the disposition of any or all assets (including the Capital Stock of a Subsidiary or any ownership interest in a joint venture) of any Obligor or any Subsidiary thereof whether by sale, lease, transfer or otherwise. The term “Asset Disposition” shall not include any Equity Issuance or any Debt Issuance.

 

Assignment Agreement” means an agreement substantially in the form set out in Part B (Form of Assignment Agreement) of Schedule 5 (Form of Transfer Certificate and Assignment Agreement) or any other form agreed between the relevant assignor and assignee.

 

4
 

 

Attributable Indebtedness” means, on any date:

 

(a)in respect of any Capital Lease of any person, the capitalised amount thereof that would appear on a balance sheet of such person prepared as of such date in accordance with GAAP; and

 

(b)in respect of any Synthetic Lease, the capitalised amount or principal amount of the remaining lease payments under the relevant lease that would appear on a balance sheet of such person prepared as of such date in accordance with GAAP if such lease were accounted for as a Capital Lease.

 

Authorisation” means an authorisation, consent, approval, resolution, licence, exemption, filing, notarisation or registration (including all Governmental Approvals).

 

Authorised Signatory” means, with respect to the Supplier and the Launch Services Provider, a person authorised to sign any document on its behalf to be delivered pursuant to this Agreement.

 

Availability Period” means, subject to clause 7 (Other Provisions) of the Global Deed of Amendment and Restatement, the period from and including the date of this Agreement to and including 31 December 2012.

 

Available Cash” means the sum of:

 

(a)the Borrower’s consolidated unrestricted cash balance at the beginning of the relevant Payment Period less the minimum Liquidity threshold set out in Clause 20.2 (Minimum Liquidity);

 

(b)any Spectrum Cash Flow for the relevant Payment Period; and

 

(c)any Excess Cash Flow for the relevant Payment Period.

 

Available Commitment” means, in relation to a Facility, a Lender’s Commitment under that Facility minus:

 

(a)the amount of its participation in any outstanding Loans under that Facility; and

 

(b)in relation to any proposed Utilisation, the amount of its participation in any Loans that are due to be made under that Facility on or before the proposed Utilisation Date.

 

Available Facility” means, in relation to a Facility, the aggregate for the time being of each Lender’s Available Commitment in respect of that Facility.

 

Borrower Pledge of Bank Accounts” means the French law “Convention de Nantissement de Comptes Bancaires” dated 5 June 2009 between the Borrower, the Offshore Account Bank and the Security Agent.

 

Borrower Additional Pledge of Bank Accounts” means the French law “Convention de Nantissement de Comptes Bancaires” dated on or around the Effective Date between the Borrower, the Offshore Bank and the Security Agent.

 

Break Costs” means the amount (if any) by which:

 

(a)the interest which a Lender should have received for the period from the date of receipt of all or any part of its participation in a Loan or Unpaid Sum to the last day of the current Interest Period in respect of that Loan or Unpaid Sum, had the principal amount or Unpaid Sum received been paid on the last day of that Interest Period;

 

exceeds:

 

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(b)the amount which that Lender would be able to obtain by placing an amount equal to the principal amount or Unpaid Sum received by it on deposit with a leading bank in the London interbank market for a period starting on the Business Day following receipt or recovery and ending on the last day of the current Interest Period.

 

Business Day” means a day (other than a Saturday or Sunday) on which banks are open for general business in London, Paris and New York City.

 

Canadian Dollars” means the lawful currency for the time being of Canada.

 

Capital Assets” means, with respect to the Borrower and its Subsidiaries:

 

(a)any asset that should, in accordance with GAAP, be classified and accounted for as a capital asset on a Consolidated balance sheet of the Borrower and its Subsidiaries but excluding any capitalised interest; and

 

(b)non-capitalised cash payments attributable to any second generation Satellite Launch and ground segment vendors.

 

Capital Expenditures” means with respect to the Borrower and its Subsidiaries for any period, the aggregate cost of all Capital Assets acquired by the Borrower and its Subsidiaries during such period, as determined in accordance with GAAP.

 

Capital Lease” means any lease of any property by the Borrower or any of its Subsidiaries, as lessee, that should, in accordance with GAAP, be classified and accounted for as a capital lease on a Consolidated balance sheet of the Borrower and its Subsidiaries.

 

Capital Stock” means:

 

(a)in the case of a corporation, capital stock;

 

(b)in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of capital stock;

 

(c)in the case of a partnership, partnership interests (whether general or limited);

 

(d)in the case of a limited liability company, membership interests; and

 

(e)any other interest or participation that confers on a person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing person.

 

Cash” means, at any time, cash denominated in Dollars and the Dollar equivalent of Euros and Canadian Dollars, in hand or at bank and (in the latter case) credited to an account in the name of an Obligor with an Acceptable Bank and to which an Obligor is alone (or together with other Obligors) beneficially entitled and for so long as:

 

(a)that cash is repayable on demand;

 

(b)repayment of that cash is not contingent on the prior discharge of any other indebtedness of any member of the Group or of any other person whatsoever or on the satisfaction of any other condition;

 

(c)there is no Lien over that cash except for Liens created pursuant to the Security Documents or any Permitted Lien constituted by a netting or set-off arrangement entered into by members of the Group in the ordinary course of their banking arrangements; and

 

(d)the cash is freely and immediately available to be applied in repayment or prepayment of the Facilities.

 

6
 

 

Cash Equivalent Instruments” means at any time:

 

(a)certificates of deposit maturing within one (1) year after the relevant date of calculation and issued by an Acceptable Bank;

 

(b)any investment in marketable debt obligations issued or guaranteed by the government of the United States of America, the United Kingdom, any member state of the European Economic Area or any Participating Member State or by an instrumentality or agency of any of them having an equivalent credit rating, maturing within one (1) year after the relevant date of calculation and not convertible or exchangeable to any other security;

 

(c)commercial paper not convertible or exchangeable to any other security:

 

(i)for which a recognised trading market exists;

 

(ii)issued by an issuer incorporated in the United States of America, the United Kingdom, any member state of the European Economic Area or any Participating Member State;

 

(iii)which matures within one (1) year after the relevant date of calculation; and

 

(iv)which has a credit rating of either A-1 or higher by S&P or F1 or higher by Fitch Ratings Ltd or P-1 or higher by Moody’s, or, if no rating is available in respect of the commercial paper, the issuer of which has, in respect of its long-term unsecured and non-credit enhanced debt obligations, an equivalent rating;

 

(d)any investment in money market funds which:

 

(i)have a credit rating of either A-1 or higher by S&P or F1 or higher by Fitch Ratings Ltd or P-1 or higher by Moody’s;

 

(ii)invest substantially all their assets in securities of the types described in paragraphs (a) to (c) above; and

 

(iii)can be turned into cash on not more than thirty (30) days’ notice; or

 

(e)any other debt or marketable security approved by the Majority Lenders,

 

in each case, denominated in Dollars and the Dollar equivalent of Euros and Canadian Dollars, and to which any Obligor is alone (or together with other Obligors) beneficially entitled at that time and which is not issued or guaranteed by any member of the Group or subject to any Lien (other than a Lien arising under the Security Documents).

 

Change in Control” has the meaning given to such term in Clause 7.2 (Mandatory Prepayment – Exit).

 

Code” means the US Internal Revenue Code of 1986, and the rules and regulations thereunder, each as amended or modified from time to time.

 

COFACE” means La Compagnie Française d’Assurance pour le Commerce Extérieur a French société anonyme whose registered office is at 1, place Costes et Bellonte, CS 20003, 92276 Bois-Colombes, France and registered at the Registre du Commerce et des Societés of Nanterre with registered number 552 069 791.

 

COFACE Additional Insurance Premium” means the premium due to COFACE payable by the Borrower to the COFACE Agent (for the account of COFACE) in accordance with Clause 12.1(c) (COFACE Insurance Premia and COFACE Additional Insurance Premium) in an amount of US$20,000,000.

 

7
 

 

COFACE Insurance Policy” means each credit insurance policy (as amended from time to time) in respect of this Agreement to be issued by COFACE for the benefit of the Lenders in respect of each Facility and as approved by the COFACE Agent (on behalf of the Lenders) pursuant to articles L.432-1 to L.432-4 of the French Code des Assurances and signed by the COFACE Agent and the Original Lenders.

 

COFACE Insurance Premia” means the premia due to COFACE payable by the Borrower to the COFACE Agent (for the account of COFACE) on each Facility in accordance with Clause 12.1(b) (COFACE Insurance Premia and COFACE Additional Insurance Premium).

 

Collateral” means the collateral security for the Obligations pledged or granted pursuant to the Security Documents.

 

Collateral Agreement” means the security agreement dated 22 June 2009 (as supplemented by the Joinder Agreement and as amended and restated by the Security Amendment and Restatement Agreement) between the Borrower, each Domestic Subsidiary and the Security Agent.

 

Collection Account” has the meaning given to such term in the Accounts Agreement.

 

Commercial Contracts” means:

 

(a)the Launch Services Contract; and

 

(b)the Satellite Construction Contract,

 

and, “Commercial Contract” means either of the foregoing as the context requires.

 

Commitment” means a Facility A Commitment and/or a Facility B Commitment.

 

Communication Act” means the US Communications Act of 1934 (47 U.S.C. 151, et seq.) as amended.

 

Communications Licences” means the licences, permits, authorisations or certificates to construct, own, operate or promote the telecommunications business of the Borrower and its Subsidiaries (including, without limitation, the launch and operation of Satellites) as granted, or to be granted, by the FCC or the ANFR (and any other Governmental Authority), and all extensions, additions and renewals thereto or thereof.

 

Compliance Certificate” means a certificate substantially in the form set out in Schedule 8 (Form of Compliance Certificate).

 

Confidential Information” means all information relating to the Borrower, any other Obligor, the Group, the Finance Documents or a Facility of which a Finance Party becomes aware in its capacity as, or for the purpose of becoming, a Finance Party or which is received by a Finance Party in relation to, or for the purpose of becoming a Finance Party under, the Finance Documents or a Facility from either:

 

(a)any member of the Group or any of its advisers; or

 

(b)another Finance Party, if the information was obtained by that Finance Party directly or indirectly from any member of the Group or any of its advisers,

 

in whatever form, and includes information given orally and any document, electronic file or any other way of representing or recording information which contains or is derived or copied from such information but excludes information that:

 

(i)is or becomes public information other than as a direct or indirect result of any breach by that Finance Party of Clause 41 (Confidentiality); or

 

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(ii)is identified in writing at the time of delivery as non-confidential by any member of the Group or any of its advisers; or

 

(iii)is known by that Finance Party before the date the information is disclosed to it in accordance with paragraphs (a) or (b) above or is lawfully obtained by that Finance Party after that date, from a source which is, as far as that Finance Party is aware, unconnected with the Group and which, in either case, as far as that Finance Party is aware, has not been obtained in breach of, and is not otherwise subject to, any obligation of confidentiality.

 

Confidentiality Undertaking” means a confidentiality undertaking substantially in the form set out in Schedule 10 (Form of Confidentiality Undertaking) or in any other form agreed between the Borrower and the COFACE Agent.

 

Consolidated” means, when used with reference to financial statements or financial statement items of any person, such statements or items on a consolidated basis in accordance with applicable principles of consolidation under GAAP.

 

Consolidated EBITDA” means, for any period, the sum of the following determined on a Consolidated basis, without duplication, for the Borrower and its Subsidiaries in accordance with GAAP:

 

(a)Consolidated Net Income for such period; plus

 

(b)the sum of the following to the extent deducted in determining Consolidated Net Income:

 

(i)income and franchise taxes;

 

(ii)Consolidated Interest Expense;

 

(iii)amortisation, depreciation and other non-cash charges (except to the extent that such non-cash charges are reserved for cash charges to be taken in the future);

 

(iv)extraordinary losses (other than from discontinued operations) and any losses on foreign currency transaction; and

 

(v)any Transaction Costs (provided that, in no event shall the aggregate amount of Transaction Costs relating to the negotiation of any Permitted Acquisitions or Permitted Joint Venture Investments which are not consummated added back to net income during any four (4) consecutive fiscal quarter period exceed US$1,000,000), less

 

(c)interest income and any extraordinary gains and any gains on foreign currency transactions.

 

Consolidated Interest Expense” means, with respect to the Borrower and its Subsidiaries for any period, the gross interest expense (including, interest expense attributable to Capital Leases, all net payment obligations pursuant to Hedging Agreements and cash interest in respect of indebtedness (including vendor indebtedness) but excluding any non-cash interest) of the Borrower and its Subsidiaries, all determined for such period on a Consolidated basis, without duplication, in accordance with GAAP.

 

9
 

 

Consolidated Net Income” means, with respect to the Borrower and its Subsidiaries, for any period of determination, the net income (or loss) of the Borrower and its Subsidiaries for such period, determined on a Consolidated basis in accordance with GAAP, provided that there shall be excluded (without double counting) from the calculation of income:

 

(a)the net income (or loss) of any person (other than a Subsidiary which shall be subject to paragraph (c) below), in which the Borrower or any of its Subsidiaries has a joint interest with a third party, except to the extent such net income is actually paid in cash to the Borrower or any of its Subsidiaries by dividend or other distribution during such period;

 

(b)the net income (or loss) of any person accrued prior to the date it becomes a Subsidiary of such person or is merged into or consolidated with such person or any of its Subsidiaries or that person’s assets are acquired by such person or any of its Subsidiaries except to the extent included pursuant to the foregoing paragraph (a);

 

(c)the net income (if positive) of any Subsidiary to the extent that the declaration or payment of dividends or similar distributions by such Subsidiary to the Borrower or any of its Subsidiaries of such net income is not at the time permitted by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute rule or governmental regulation applicable to such Subsidiary; and

 

(d)the proceeds of any Equity Issuances and/or Subordinated Indebtedness.

 

Consultation Period” has the meaning given to such term in Clause 19.3(c) (Annual Business Plan and Financial Projections).

 

Contract Price” means the aggregate price to be paid by the Borrower to:

 

(a)the Supplier under and in relation to the Satellite Construction Contract being an amount (in aggregate) equal to €298,919,905 plus US$218,483,217.82; and

 

(b)the Launch Services Provider under and in relation to the Launch Services Contract being US$216,000,000.

 

Convertible Notes” means:

 

(a)the 5% Notes;

 

(b)the 8% New Notes;

 

(c)the 8% Old Notes; and

 

(d)any other convertible notes issued by the Borrower (or its Subsidiaries) after the Effective Date in compliance with the terms of this Agreement.

 

Covenant Capital Expenditure” means any Capital Expenditure, including (but not limited to), for the avoidance of doubt, any Capital Expenditure funded with the Net Cash Proceeds received in connection with:

 

(a)any Insurance and Condemnation Event;

 

(b)any Asset Disposition; and

 

(c)any Equity Issuance or funded by the issuance of Capital Stock of the Borrower to the seller (or an affiliate thereof) of the related Capital Asset,

 

but excluding, any Capital Expenditure funded with the Net Cash Proceeds received in connection with an Insurance and Condemnation Event or an Asset Disposition provided that such Net Cash Proceeds are reinvested in “like-for-like” replacement assets in accordance with Clause 7.5 (Mandatory Prepayment – Insurance and Condemnation Events) or Clause 7.6 (Mandatory Prepayment – Asset Dispositions) (as the case may be).

 

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Current Assets” has the meaning given to such term under GAAP but deducting Cash and Cash Equivalent Instruments (excluding any Cash and Cash Equivalent Instruments subject to any Lien, including Liens created pursuant to the Security Documents).

 

Current Liabilities” has the meaning given to such term under GAAP but excluding the current portion of any long-term Financial Indebtedness outstanding on the date of calculation.

 

Debt Issuance” means any issuance of any Financial Indebtedness for borrowed money by the Borrower or any of its Subsidiaries. The term “Debt Issuance” shall not include any Equity Issuance or any Asset Disposition.

 

Debt Service” means the aggregate Dollar amount of principal, interest, and, if any, fees and other sums required to be paid by the Borrower pursuant to the Finance Documents and pursuant to all the Borrower’s Financial Indebtedness incurred from time to time, including all amounts which have become due and payable as at the date of calculation but which have not been paid on such date for the Relevant Period.

 

Debt Service Account” has the meaning given to such term in the Accounts Agreement.

 

Debt Service Coverage Ratio” means, on any date, the ratio of:

 

(a)Adjusted Consolidated EBITDA (without double-counting),

 

(i)plus, any Liquidity (in an amount exceeding US$4,000,000) at the beginning of any relevant period of calculation plus the cash proceeds of any Equity Issuance or Subordinated Indebtedness raised during the relevant period not committed, or required to be applied, for any other purpose under the Finance Documents but including monies standing to the credit of the Collection Account which are not required to be applied for any other purpose;

 

(ii)less the sum of the following (without double-counting);

 

(A)any Covenant Capital Expenditure;

 

(B)any changes in Working Capital; and

 

(C)any cash taxes,

 

to

 

(b)Debt Service,

 

in each case, during the relevant period of calculation.

 

Debt Service Reserve Account” has the meaning given to such term in the Accounts Agreement.

 

Default” means an Event of Default or any event or circumstance specified in Clause 23 (Events of Default) which would (with the expiry of a grace period, the giving of notice, the making of any determination under the Finance Documents or any combination of any of the foregoing) be an Event of Default.

 

Delegation Agreement” means:

 

(a)the French law delegation agreement dated 5 June 2009 between the Borrower, the Supplier and the Security Agent as amended by an amendment agreement to be entered into on or after the Effective Date pursuant to the Global Deed of Amendment and Restatement between the Borrower, the Security Agent and the Supplier; and

 

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(b)the French law delegation agreement dated 24 June 2009 between the Borrower, the Launch Services Provider and the Security Agent as amended by an amendment agreement to be entered into on or after the Effective Date pursuant to the Global Deed of Amendment and Restatement between the Borrower, the Security Agent and the Launch Services Provider.

 

Disruption Event” means either or both of:

 

(a)a material disruption to those payment or communications systems or to those financial markets which are, in each case, required to operate in order for payments to be made in connection with a Facility (or otherwise in order for the transactions contemplated by the Finance Documents to be carried out) which disruption is not caused by, and is beyond the control of, any of the Parties; or

 

(b)the occurrence of any other event which results in a disruption (of a technical or systems-related nature) to the treasury or payments operations of a Party preventing that, or any other Party:

 

(i)from performing its payment obligations under the Finance Documents; or

 

(ii)from communicating with other Parties in accordance with the terms of the Finance Documents,

 

and which (in either such case) is not caused by, and is beyond the control of, the Party whose operations are disrupted.

 

Dollar” and “US$” means the lawful currency for the time being of the United States of America.

 

Domestic Subsidiary” means any Subsidiary organised under the laws of any state of the United States or the District of Colombia, other than GCL Licensee LLC.

 

DSA Required Balance” has the meaning given to such term in the Accounts Agreement.

 

DSRA Required Balance” means an amount equal to US$37,913,900.

 

Earth Station” means any earth station (gateway) licenced for operation by the FCC or by a Governmental Authority outside the United States that is owned and operated by the Borrower or any of its Subsidiaries.

 

Effective Date” means the “Effective Date” as such term is defined in the Global Deed of Amendment and Restatement.

 

Effective Date Commitment” means the equity commitment made by Thermo in respect of the Borrower prior to the Effective Date pursuant to the Restructuring Support and Consent Agreement in an amount equal to US$25,000,000.

 

Eligible Amount” means:

 

(a)in the case of Facility A, an amount which is equivalent of eighty five per cent. (85%) of the total cost of the Eligible Goods and Services which is at any time due and payable under and in accordance with the Satellite Construction Contract; and

 

(b)in the case of Facility B, one hundred per cent. (100%) of the amount of US$21,600,000, representing goods made in France and/or services performed in France under the Launch Services Contract.

 

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Eligible Goods and Services” means:

 

(a)goods made in France and/or services performed in France; and

 

(b)goods and services (including transport and insurance of any nature) originating from countries other than France and the United States, incorporated in the items delivered by the Supplier and/or the Launch Services Provider and which have been sub-contracted by the Supplier and/or the Launch Services Provider and therefore remaining under its responsibility, and recognised as being eligible by the French Authorities to be financed by this Agreement,

 

which are included in the aggregate Contract Price within an amount of eligibility of:

 

(i)an amount equal to (in aggregate) €298,919,905 plus US$218,483,217.82 under the Satellite Construction Contract; and

 

(ii)US$21,600,000 under the Launch Services Contract.

 

Employee Benefit Plan” means any employee benefit plan within the meaning of Section 3(3) of ERISA which:

 

(a)is maintained or contributed to by any Obligor or any ERISA Affiliate, or to which any Obligor or ERISA Affiliate has an obligation to contribute; or

 

(b)has at any time within the preceding six (6) years been maintained or contributed to by any Obligor or any current or former ERISA Affiliate, or with respect to which any Obligor or any such ERISA Affiliate has had an obligation to contribute (or is deemed under Section 4069 of ERISA to have maintained or contributed, or to have had an obligation to contribute, or otherwise to have liability).

 

Environmental Claims” means any and all administrative, regulatory or judicial actions, suits, demands, demand letters, claims, judgments, liens, accusations, allegations, notices of non-compliance or violation, investigations (other than internal reports prepared by any person in the ordinary course of trading and not in response to any third party action or request of any kind) or proceedings relating in any way to any actual or alleged violation of or liability under any Environmental Law or relating to any Environmental Permit issued, or any approval given, under any such Environmental Law, including any and all claims by Governmental Authorities for enforcement, clean-up, removal, response, remedial or other actions or damages, contribution, indemnification cost recovery, penalties, fines, compensation or injunctive relief resulting from Hazardous Materials or arising from alleged injury or threat of injury to human health or the environment.

 

Environmental Laws” means any and all federal, foreign state, state, regional, provincial and local laws, statutes, ordinances, codes, rules, standards and regulations, common law, permits, licences, approvals, interpretations and orders of courts or Governmental Authorities, and amendments thereto, relating to the protection of human health or the environment, including, but not limited to, requirements pertaining to the manufacture, processing, distribution, use, treatment, storage, disposal, transportation, handling, reporting, licensing, permitting, emission, release or threatened release, investigation or remediation of Hazardous Materials. For the purposes of this definition, the term “Environmental Laws” shall include but not be limited to:

 

(a)the US Comprehensive Environmental Response, Compensation and Liability Act, as amended (42 U.S.C. Section 9601, et seq.); and

 

(b)the US Resource Conservation and Recovery Act, as amended (42 U.S.C. Section 6901, et seq.).

 

13
 

 

Environmental Permits” means any permit and other Authorisation and the filing of any notification, report or assessment under any Environmental Law for the operation of the business of any member of the Group conducted on or from the properties owned or used by any member of the Group.

 

Equity Commitments” means:

 

(a)the Initial Minimum Cash Commitment;

 

(b)the Effective Date Commitment;

 

(c)the 2013 Closing Commitment;

 

(d)the 2013 Year-End Commitment; and

 

(e)the 2014 Anticipated Equity Financing.

 

Equity Cure Contribution” means cash funds contributed to the Borrower from the issuance of shares in the Borrower’s Capital Stock and/or Subordinated Indebtedness (but excluding the Initial Equity) in the amounts as set out in Clause 23.2(c) (Financial Covenants).

 

Equity Issuance” means any issuance by the Borrower or any Subsidiary to any person of:

 

(a)shares of its Capital Stock;

 

(b)any shares of its Capital Stock pursuant to the exercise of options or warrants; or

 

(c)any shares of its Capital Stock pursuant to the conversion of any debt securities to equity.

 

The term “Equity Issuance” shall not include any Asset Disposition, any Debt Issuance, the conversion of any of the Convertible Notes or the issuance of any other Capital Stock pursuant to the Fourth Supplemental Indenture in circumstances where the Borrower (or any Subsidiary) does not receive any cash proceeds.

 

Equity Linked Securities” has the meaning given to such term in the Global Deed of Amendment and Restatement.

 

Ericsson” means Ericsson Federal Inc. a Delaware corporation with a place of business at 1595 Spring Hill Road, Vienna, VA 22182, United States.

 

ERISA” means the US Employee Retirement Income Security Act of 1974, and the rules and regulations thereunder, each as amended or modified from time to time.

 

ERISA Affiliate” means any person who together with any Obligor is treated as a single employer within the meaning of Section 414(b), (c), (m) or (o) of the Code or Section 4001(b) of ERISA.

 

ERISA Termination Event” means:

 

(a)a “Reportable Event” described in Section 4043 of ERISA with respect to a Pension Plan for which the notice requirement has not been waived by the PBGC; or

 

(b)the withdrawal of any Obligor or any ERISA Affiliate from a Pension Plan during a plan year in which it was a “substantial employer” as defined in Section 4001(a)(2) of ERISA; or

 

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(c)the termination of a Pension Plan, the filing of a notice of intent to terminate a Pension Plan or the treatment of a Pension Plan amendment as a termination, under Section 4041 of ERISA, if such termination would require material additional contributions in order to be considered a standard termination within the meaning of Section 4041(b) of ERISA, or the filing under Section 4041(a)(2) of ERISA of a notice of intent to terminate any Pension Plan or the termination of any Pension Plan under Section 4041(c) of ERISA; or

 

(d)the institution of proceedings to terminate, or the appointment of a trustee with respect to, any Pension Plan by the PBGC; or

 

(e)any other event or condition which would reasonably be expected to constitute grounds under Section 4042(a) of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan; or

 

(f)the failure to make a required contribution to any Pension Plan that would reasonably be expected to result in the imposition of a Lien or the provision of security under Section  430 of the Code or Section 303 or 4068 of ERISA, or the arising of such a Lien; the failure to satisfy the minimum funding standard under section 412 of the Code or section 302 of ERISA, whether or not waived; or the filing of any request for or receipt of a minimum funding waiver under Section 412 of the Code or Section 302 of ERISA with respect to any Pension Plan, or that such filing may be made; or a determination that any Pension Plan is, or is expected to be, considered an at-risk plan within the meaning of Section 430 of the Code or Section 303 of ERISA; or

 

(g)the partial or complete withdrawal of any Obligor of any ERISA Affiliate from a Multiemployer Plan if withdrawal liability is asserted by such plan; or

 

(h)any event or condition which results, or is reasonably expected to result, in the reorganisation or insolvency of a Multiemployer Plan under Sections 4241 or 4245 of ERISA; or

 

(i)any event or condition which results, or is reasonably expected to result, in the termination of a Multiemployer Plan under Section 4041A of ERISA or the institution by PBGC of proceedings to terminate a Multiemployer Plan under Section 4042 of ERISA; or

 

(j)the receipt by any Obligor or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from any Obligor or any ERISA Affiliate of any notice, that a Multiemployer Plan is in endangered or critical status under Section 432 of the Code or Section 305 of ERISA.

 

Euro” or “” means the single currency of the Participating Member States.

 

Event of Default” means any event or circumstance specified as such in Clause 23 (Events of Default).

 

Exceptional Items” means any material items of an unusual or non-recurring nature which represent gains or losses including those arising on:

 

(a)the restructuring of the activities of an entity and reversals of any provisions for the cost of restructuring;

 

(b)disposals, revaluations, write downs or impairment of non-current assets or any reversal of any write down or impairment;

 

(c)disposals of assets associated with discontinued operations; or

 

(d)other exceptional terms reasonably determined by the COFACE Agent in good faith.

 

15
 

 

Excess Cash Flow” means, for any period of determination, the sum of the following determined on a Consolidated basis, without duplication, for the Borrower and its Subsidiaries in accordance with GAAP:

 

(a)Adjusted Consolidated EBITDA for such period;

 

minus

 

(b)(to the extent not already deducted in the calculation of Adjusted Consolidated EBITDA):

 

(i)cash taxes and Consolidated Interest Expense paid in cash for such period;

 

(ii)all scheduled principal payments made in respect of Financial Indebtedness during such period;

 

(iii)the lesser of:

 

(A)all Covenant Capital Expenditures made during the relevant period; and

 

(B)in respect of the calendar years:

 

(1)2013 through to 2016 (inclusive), the amount set out in column 2 (Maximum Covenant Capex for Excess Cash Flow Calculation) of the table in Part B (Maximum Covenant Capital Expenditures for Excess Cash Flow Calculation) of Schedule 4 (Maximum Covenant Capital Expenditures); or

 

(2)2017 and onwards, US$2,500,000 per relevant period,

 

(except in each case to the extent funded directly through the incurrence of Financial Indebtedness or equity contributions or investments);

 

(iv)any increase in Working Capital during such period;

 

(v)any amount applied to fund any scheduled cash reserve required under the Finance Documents, including the DSA Required Balance and the DSRA Required Balance in such period;

 

(vi)voluntary, mandatory and other non-scheduled principal payments with respect to any Loans or other Financial Indebtedness in such period (except for any mandatory payments made pursuant to Clauses 7.3 (Mandatory Prepayment – Cash Sweep of Spectrum Cash Flow), 7.4 (Mandatory Prepayment – Excess Cash Flow), 7.8 (Mandatory Prepayment – Cash Sweep following Spectrum Sale) and 7.9 (Mandatory Prepayment – Cash Sweep following Equity Issuance and Debt Issuance) and any payments that constitute or with the passage of time or giving of notice or both would constitute a Default or an Event of Default);

 

(vii)to the extent included in Adjusted Consolidated EBITDA, Spectrum Cash Flow and any other monetization of the Group’s Spectrum rights;

 

(viii)any cash payments in respect of the Restructuring Fee, and the COFACE Additional Insurance Premium;

 

(ix)any cash payments during such period in respect of any Exceptional Items;

 

(x)Transaction Costs during such period (solely to the extent added back to net income in the calculation of Adjusted Consolidated EBITDA);

 

16
 

 

(xi)any non-cash income recognized during such period;

 

(xii)any cash utilized during such period in respect of amounts expensed in a prior period;

 

(xiii)any non-cash extraordinary losses and any losses on foreign currency transactions; and

 

(xiv)the portion of the purchase price and other reasonable acquisition related costs paid during such period to make Permitted Acquisitions and investments, except to the extent financed with proceeds of Financial Indebtedness, Equity Issuances or insurance or casualty payments,

 

plus

 

(c)(to the extent not already added in the calculation of Adjusted Consolidated EBITDA and without double counting):

 

(i)any decrease in Working Capital during such period;

 

(ii)any amount received as a result of decreasing cash reserves required under the Finance Documents, including the DSA Required Balance and the DSRA Required Balance in such period;

 

(iii)any cash receipts in respect of Exceptional Items;

 

(iv)any cash income whereby cash is received but the recognition of GAAP income is deferred during such period to another period;

 

(v)any expense recognized during such period in respect of amounts paid in a prior period; and

 

(vi)any cash received during such period in respect of extraordinary gains and any gains on foreign currency transactions.

 

Exchange Act” has the meaning given to such term in paragraph (i) of the definition of “Borrower Change of Control” in Clause 7.2(a) (Mandatory Prepayment – Exit).

 

Excluded Purchase Agreement Amount” means US$19,500,000.

 

Existing Canadian Note” means the three (3) Month libor plus three point fifty per cent. (3.50%) notes issued by Globalstar Canada Satellite Co. in favour of the Borrower.

 

Facilities” means:

 

(a)Facility A; and

 

(b)Facility B,

 

and, “Facility” means either of the foregoing as the context requires.

 

Facility A” has the meaning given to such term in Clause 2.1(a) (Facility A and Facility B).

 

Facility A Commitment” means:

 

(a)in relation to an Original Lender, the amount in Dollars set opposite its name under the heading “Facility A Commitments US$” in Part 1 (Facility A) of Schedule 1 (Lenders and Commitments) and the amount of any other Facility A Commitment transferred to it under this Agreement; and

 

17
 

 

(b)in relation to any other Lender, the amount of any other Facility A Commitment transferred to it under this Agreement,

 

to the extent not cancelled, reduced or transferred by it under this Agreement.

 

Facility A Loan” means a loan made or to be made under Facility A or the principal amount outstanding for the time being of that loan.

 

Facility B” has the meaning given to such term in Clause 2.1(b) (Facility A and Facility B).

 

Facility B Commitment” means:

 

(a)in relation to an Original Lender, the amount in Dollars set opposite its name under the heading “Facility B Commitments US$” in Part 2 (Facility B) of Schedule 1 (Lenders and Commitments) and the amount of any other Facility B Commitment transferred to it under this Agreement; and

 

(b)in relation to any other Lender, the amount of any other Facility B Commitment transferred to it under this Agreement,

 

to the extent not cancelled, reduced or transferred by it under this Agreement.

 

Facility B Loan” means a loan made or to be made under Facility B or the principal amount outstanding for the time being of that loan.

 

Facility Office” means the office or offices notified by a Lender to the COFACE Agent in writing on or before the date it becomes a Lender (or, following that date, by not less than five (5) Business Days’ written notice) as the office or offices through which it will perform its obligations under this Agreement.

 

FATCA” means:

 

(a)sections 1471 to 1474 of the Code or any associated regulations or other official guidance;

 

(b)any treaty, law, regulation or other official guidance enacted in any other jurisdiction, or relating to an intergovernmental agreement between the US and any other jurisdiction, which (in either case) facilitates the implementation of paragraph (a) above; or

 

(c)any agreement pursuant to the implementation of paragraphs (a) or (b) above with the US Internal Revenue Service, the US government or any governmental or taxation authority in any other jurisdiction.

 

FATCA Application Date” means, in relation to a:

 

(a)withholdable payment” described in section 1473(1)(A)(i) of the Code (which relates to payments of interest and certain other payments from sources within the US), 1 July 2014;

 

(b)withholdable payment” described in section 1473(1)(A)(ii) of the Code (which relates to “gross proceeds” from the disposition of property of a type that can produce interest from sources within the U.S.), 1 January 2017; or

 

(c)passthru payment” described in section 1471(d)(7) of the Code not falling within paragraphs (a) or (b) above, 1 January 2017, or, in each case, such other date from which such payment may become subject to a deduction or withholding required by FATCA as a result of any change in FATCA after the Effective Date.

 

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FATCA Deduction” means a deduction or withholding from a payment under a Finance Document required by FATCA.

 

FATCA Exempt Party” means a Party that is entitled to receive payments free from any FATCA Deduction.

 

FCC” shall mean the Federal Communications Commission.

 

FDIC” means the Federal Deposit Insurance Corporation.

 

Final Discharge Date” has the meaning given to such term in the Accounts Agreement.

 

Final Maturity Date” means 31 December 2022.

 

Final In-Orbit Acceptance” means the date upon which each of the following has occurred:

 

(a)the twenty-fourth (24th) Satellite has reached its final altitude;

 

(b)the testing of the twenty-fourth (24th) Satellite has been completed and the Borrower has provided to the COFACE Agent a certificate signed by a Responsible Officer certifying that the Borrower has delivered to its relevant insurer a confirmation that the Satellite Performance Criteria have been successfully met in respect of the twenty-fourth (24th) Satellite (and attaching a copy of such confirmation to such certificate); and

 

(c)each Satellite has drifted into its final orbital plane position,

 

as certified by the Borrower in accordance with Clause 19.9 (Final In-Orbit Acceptance).

 

Finance Documents” means:

 

(a)this Agreement;

 

(b)the Global Deed of Amendment and Restatement;

 

(c)the Accounts Agreement;

 

(d)the Supplier Direct Agreement;

 

(e)the LSP Direct Agreement;

 

(f)each Security Document;

 

(g)the Security Amendment and Restatement Agreement;

 

(h)each Guarantee Agreement;

 

(i)any Transfer Certificate and/or Assignment Agreement;

 

(j)each Promissory Note;

 

(k)the Thermo Subordination Deed;

 

(l)the Subsidiary Guarantor Subordination Deed;

 

(m)the Thermo Group Undertaking Letter;

 

(n)the Restructuring Support and Consent Agreement (to the extent that the provisions thereof are expressed to survive the termination of such document upon the occurrence of the Effective Date);

 

(o)the Joinder Agreement;

 

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(p)the Defaults Side-Letter (as such term is defined in the Global Deed of Amendment and Restatement);

 

(q)to the extent not already covered by items (a) to (o) (inclusive) above, each Restructuring Document (as such term is defined in the Global Deed of Amendment and Restatement); and

 

(r)any other document designated in writing as a “Finance Document” by the COFACE Agent and the Borrower (acting reasonably),

 

and, “Finance Document” means any of the foregoing as the context requires.

 

Finance Parties” means:

 

(a)the COFACE Agent;

 

(b)each Mandated Lead Arranger;

 

(c)the Security Agent; and

 

(d)the Lenders,

 

and, “Finance Party” means any of the foregoing as the context requires.

 

Financial Advisor” means any financial advisor appointed pursuant to Clause 17.5(b)(iii) (Financial Advisory Appointment).

 

Financial Close” means the date on which each of the conditions precedent referred to in Clause 4.1 (Initial Conditions Precedent) and Clause 4.2 (Further Conditions Precedent) have been satisfied or waived in accordance with the terms of this Agreement.

 

Financial Conduct Authority” means the body responsible for regulating the financial services industry in the United Kingdom.

 

Financial Indebtedness” means, with respect to the Borrower and its Subsidiaries at any date and without duplication, the sum of the following calculated in accordance with GAAP:

 

(a)all liabilities, obligations and indebtedness for borrowed money including, but not limited to, obligations evidenced by bonds, debentures, notes or other similar instruments of any such person;

 

(b)all obligations of the Borrower or any of its Subsidiaries to pay the deferred purchase price of property or services (including, without limitation, all obligations under non-competition, earn-out or similar agreements) and any Permitted Vendor Indebtedness, in each case, to the extent classified as debt in accordance with GAAP, except trade payables arising in the ordinary course of trading:

 

(i)not more than ninety (90) days past due; or

 

(ii)being duly contested by the Borrower in good faith;

 

(c)the Attributable Indebtedness of the Borrower or any of its Subsidiaries with respect to the obligations of the Borrower or such Subsidiary in respect of Capital Leases and Synthetic Leases (regardless of whether accounted for as indebtedness under GAAP);

 

(d)all Financial Indebtedness of any third party secured by a Lien on any asset owned or being purchased by the Borrower or any of its Subsidiaries (including indebtedness arising under conditional sales or other title retention agreements), whether or not such indebtedness shall have been assumed by the Borrower or any of its Subsidiaries or is limited in recourse;

 

20
 

 

(e)all Guarantee Obligations of the Borrower or any of its Subsidiaries;

 

(f)all obligations, contingent or otherwise, of the Borrower or any of its Subsidiaries relative to the face amount of letters of credit, whether or not drawn, including without limitation, any banker’s acceptances issued for the account of the Borrower of any of its Subsidiaries;

 

(g)all obligations of the Borrower or any of its Subsidiaries to redeem, repurchase exchange, defease or otherwise make payments in respect of Capital Stock of such person; and

 

(h)all Net Hedging Obligations.

 

First Half Payment Period” means the period from 1 January to 30 June (inclusive) in any calendar year.

 

First Repayment Date” means 31 December 2014.

 

Fiscal Year” means the fiscal year of the Borrower and its Subsidiaries ending on 31 December.

 

Foreign Investment Limitation” means, as of any date of determination, an amount equal to the sum of:

 

(a)US$25,000,000; less

 

(b)the aggregate amount of Financial Indebtedness permitted pursuant to Clause 22.1(f)(iii) (Limitations on Financial Indebtedness) outstanding as of such date of determination; less

 

(c)the aggregate amount of all investments in Foreign Subsidiaries (valued as of the initial date of such investment without regard to any subsequent changes in value thereof) made after the date of this Agreement and prior to such date of determination pursuant to Clause 22.3(a)(ii)(B) (Limitations on Loans, Investments and Acquisitions); less

 

(d)the aggregate amount of all investments (valued as of the initial date of such investment without regard to any subsequent changed in value thereof) in Foreign Subsidiaries (or any entities that would constitute Foreign Subsidiaries if the Borrower or one of its Subsidiaries owned more than fifty per cent. (50%) of the outstanding Capital Stock of such entity) made after the date of this Agreement and prior to such date of determination pursuant to Clause 22.3(c) (Limitations on Loans, Investments and Acquisitions),

 

provided that, any investment of non-cash consideration constituting stock in the Borrower (howsoever described):

 

(i)in the case of a single transaction, that does not exceed US$10,000,000 in value; and

 

(ii)which transactions in aggregate since the date of this Agreement do not exceed US$50,000,000 in aggregate,

 

shall be excluded from the determination of the Foreign Investment Limitation.

 

Foreign Subsidiary” means any Subsidiary that is not a Domestic Subsidiary.

 

Fourth Supplemental Indenture” means the fourth supplemental indenture dated 20 May 2013 in respect of the 8% New Notes between the Borrower and U.S. Bank National Association.

 

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French Authorities” means the “Direction Générale du Trésor et de la Politique Economiques (DGTPE)” of the French Ministry of Finance, any successors thereto, or any other Governmental Authority in or of France involved in the provision, management or regulation of the terms, conditions and issuance of export credits including, among others, such entities to whom authority in respect of the extension or administration of export financing matters have been delegated, such as COFACE.

 

French Security Documents” has the meaning given to such term at Clause 28.2(a)(i) (Appointment of the Security Agent (France)).

 

GAAP” means generally accepted accounting principles, as recognised by the American Institute of Certified Public Accountants and the Financial Accounting Standards Board, consistently applied and maintained on a consistent basis for the Borrower and its Subsidiaries throughout the period indicated and consistent with the prior financial practice of the Borrower and its Subsidiaries.

 

Global Deed of Amendment and Restatement” means the global deed of amendment and restatement dated prior to the Effective Date between, among others, the Parties.

 

Governmental Approvals” means all authorisations, consents, approvals, permits, licences and exemptions of, registrations and filings with, and reports to, all Governmental Authorities.

 

Governmental Authority” means the government of the United States or any other nation, or of any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union, the European Central Bank, or the International Telecommunications Union).

 

Group” means the Borrower and its Subsidiaries from time to time.

 

Group Structure Chart” means the group structure chart set out in Schedule 23 (Group Structure Chart).

 

Guarantee Agreement” means:

 

(a)the guarantee agreement dated 5 June 2009 (as amended and restated pursuant to the Global Deed of Amendment and Restatement) and currently between the Security Agent and each Subsidiary Guarantor; and

 

(b)each guarantee agreement (to be in substantially the same form as the guarantee agreement referred to in paragraph (a) above) to be entered into by a Subsidiary Guarantor in accordance with Clause 21.5 (Additional Domestic Subsidiaries) and/or a Licence Subsidiary in accordance with Clause 22.12 (Nature of Business) (as the case may be).

 

Guarantee Obligations” means, with respect to the Borrower and its Subsidiaries, without duplication, any obligation, contingent or otherwise, of any such person pursuant to which such person has directly or indirectly guaranteed any Financial Indebtedness of any other person and, without limiting the generality of the foregoing, any obligation, direct or indirect, contingent or otherwise, of any such person:

 

(a)to purchase or pay (or advance or supply funds for the purchase or payment of) such Financial Indebtedness (whether arising by virtue of partnership arrangements, by agreement to keep well, to purchase assets goods, securities or services to take-or-pay, or to maintain financial statement condition or otherwise); or

 

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(b)entered into for the purpose of assuring in any other manner the obligee of such Financial Indebtedness of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part),

 

provided that, the term Guarantee Obligation shall not include endorsements for collection or deposit in the ordinary course of trading. The amount of any Guarantee Obligation shall be deemed equal to the lesser of the stated or determinable amount of the primary obligation or the maximum liability of the person giving the Guarantee Obligation.

 

Hazardous Materials” means any substances or materials:

 

(a)which are or become defined as hazardous wastes, hazardous substances, pollutants, contaminants, chemical substances or mixtures or toxic substances under any Environmental Law;

 

(b)which are toxic, explosive, corrosive, flammable, infectious, radioactive, carcinogenic, mutagenic or otherwise harmful to human health or the environment and are or become regulated by any Governmental Authority;

 

(c)the presence of which require investigation or remediation under any Environmental Law;

 

(d)the possession, use, storage, discharge, emission or release of which requires a permit or licence under any Environmental Law or other Authorisation;

 

(e)the presence of which could be deemed to constitute a nuisance or a trespass or threatens to pose a health or safety hazard to persons or neighbouring properties;

 

(f)which consist of underground or above ground storage tanks, whether empty, filled or partially filled with any substance; or

 

(g)which contain, without limitation, asbestos, polychlorinated biphenyls, urea formaldehyde foam insulation, petroleum hydrocarbons, petroleum derived substances or waste, crude oil, nuclear fuel, natural gas or synthetic gas.

 

Hedging Agreement” means any agreement with respect to any Interest Rate Contract, forward rate agreement, commodity swap, forward foreign exchange agreement, currency swap agreement, cross-currency rate swap agreement, currency option agreement or other agreement or arrangement designed to alter the risks of any person arising from fluctuations in interest rates, currency values or commodity prices, all as amended, restated, supplemented or otherwise modified from time to time.

 

Hedging Obligations” means all existing or future payment and other obligations owing by the Borrower under any Hedging Agreement with any person approved by the COFACE Agent.

 

Holding Account” has the meaning given to such term in the Accounts Agreement.

 

Holding Account Pledge Agreement” means the French law “Convention de Nantissement de Compte Bancaire” entered into by the Borrower and the Security Agent on or around the Effective Date.

 

Holding Company” means, in relation to a person, any other person in respect of which it is a Subsidiary.

 

Hughes” means Hughes Network Systems LLC a limited liability company organised under the laws of Delaware with its principal place of business at 11717 Exploration Lance, Georgetown, Maryland 20876, USA.

 

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Incapacity” means absence of the legal right to enter into binding contractual relations (other than pursuant to a civil or criminal sanction (including without limitation, personal bankruptcy or analogous proceedings)).

 

Individual In-Orbit Acceptance” means the date upon which each of the following has occurred with respect to each individual Satellite:

 

(a)the relevant Satellite has reached its final altitude;

 

(b)the relevant Satellite is fully operational and properly integrated into the constellation;

 

(c)the testing of the relevant Satellite has been completed and the Borrower has provided to the COFACE Agent a certificate signed by a Responsible Officer certifying that the Borrower has delivered to its relevant insurer a confirmation that the Satellite Performance Criteria has been successfully met in respect of the relevant Satellite (and attaching a copy of such confirmation to such certificate); and

 

(d)the relevant Satellite has drifted into its final orbital plane position,

 

as certified by the Borrower in accordance with Clause 19.10 (Individual In-Orbit Acceptance).

 

Initial Equity” means the equity contributed by Thermo (or any other third party) pursuant to paragraph 11 (Equity contribution) of Schedule 2 (Conditions Precedent) or issued to Thermo pursuant to paragraph 10 (Equity/subordinated debt) of Schedule 2 (Conditions Precedent).

 

Initial Minimum Cash Commitment” means the equity commitment made by Thermo in respect of the Borrower to fund on or before the Effective Date pursuant to the Restructuring Support and Consent Agreement an amount of up to US$20,000,000.

 

Insurance and Condemnation Event” means the receipt by the Borrower or any of its Subsidiaries of any cash insurance proceeds or condemnation award payable by reason of theft, loss, physical destruction, damage or similar event with respect to any of their respective property or assets.

 

Insurances” means the insurances required by Clause 21.4 (Insurance).

 

Insurance Consultant” means Jardine Lloyd Thompson Limited.

 

Insurance Proceeds Account” has the meaning given to such term in the Accounts Agreement.

 

Intellectual Property” has the meaning given to such term at Clause 18.7(a) (Intellectual Property Matters).

 

Interest Period” means:

 

(a)in relation to a Loan, each period determined in accordance with Clause 9 (Interest Periods); and

 

(b)in relation to an Unpaid Sum, each period determined in accordance with Clause 8.3 (Default Interest).

 

Interest Rate Cap Agreement” means each interest rate cap agreement to be entered into by the Borrower and the Original Lenders which shall (without limitation) provide that monies payable to the Borrower under such agreements are paid directly to the Debt Service Account.

 

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Interest Rate Contract” means any interest rate swap agreement, interest rate cap agreement, interest rate floor agreement, interest rate collar agreement, interest rate option or other agreement regarding the hedging of interest rate risk exposure executed in connection with hedging the interest rate exposure of any person and any confirming letter executed pursuant to such agreement, all as amended, restated, supplemented or otherwise modified from time to time.

 

Invoice” means any invoice or demand for payment issued by the Supplier and/or the Launch Services Provider pursuant to the Satellite Construction Contract and/or Launch Services Contract, as the case may be.

 

Joinder Agreement” means the joinder agreement dated 5 August 2010 entered into by the Subsidiary Guarantors set out in paragraphs 12 and 13 of Schedule 26 (Subsidiary Guarantors) in favour of the Security Agent in connection with the Collateral Agreement and the Stock Pledge Agreement.

 

Key Agreements” means:

 

(a)each Material Contract set out in Schedule 12 (Material Contracts) other than those Material Contracts referred to in paragraphs 8, 11 and 12 of Schedule 12 (Material Contracts); and

 

(b)each other Material Contract entered into after the Effective Date.

 

Landlord Waiver and Consent Agreements” means:

 

(a)any landlord waiver and consent agreement entered into between Four Sierra, LLC as landlord and the Security Agent;

 

(b)any landlord waiver and consent agreement entered into between Orinda Equity Partners, LLC as landlord and the Security Agent;

 

(c)any landlord waiver and consent agreement entered into between Sebring Airport Authority as landlord and the Security Agent; and

 

(d)any other agreement or document which the Security Agent and the Borrower (acting reasonably) from time to time designate as a “Landlord Waiver and Consent Agreement” for the purposes of this Agreement,

 

and, “Landlord Waiver and Consent Agreement” means any of the foregoing, as the context requires.

 

Launch” means the disconnection of the lift-off plug of the SOYUZ launch vehicle, if such event follows the ignition of the first (strap-on boosters) and second (core stage) stage liquid engines of the launch vehicle.

 

Launch Failure” has the meaning given to such term in the Launch Services Contract.

 

Launch Insurance” has the meaning given to such term at Clause 21.4(c)(ii) (Launch Insurance).

 

Launch Insurance Documentation” has the meaning given to such term at Clause 21.4(c)(ii) (Launch Insurance).

 

Launch Services Contract” means the launch services contract dated 5 September 2007 (as amended and restated on 9 March 2010 and from time to time and as further amended) and made between the Borrower and the Launch Services Provider for the launching into low earth orbit of the Satellites through four (4) SOYUZ launch vehicles, with an option for four (4) other similar launches.

 

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Launch Services Provider” means Arianespace, a French société anonyme registered at the Registre du Commerce et des Société of Evry under registration number 318 516 457, whose registered office is at Boulevard de l’Europe, 91006 Evry, France.

 

Lender” means:

 

(a)any Original Lender; and

 

(b)any bank, financial institution, trust, fund or other entity which has become a Party in accordance with Clause 26 (Changes to the Lenders),

 

which in each case has not ceased to be a Party in accordance with the terms of this Agreement.

 

LIBOR” means, in relation to any Loan:

 

(a)the applicable Screen Rate; or

 

(b)(if no Screen Rate is available for Dollars for the Interest Period of that Loan) the Reference Bank Rate,

 

as of 11:00 a.m. (London time) on the Quotation Day for Dollars and for a period comparable to the Interest Period of that Loan provided that, if the period from the beginning of the Interest Period or from the date of Utilisation until the end of the Interest Period is:

 

(i)a period shorter than one (1) Month, the reference shall be one (1) Month; or

 

(ii)a period longer than one (1) Month and which does not correspond to an exact number of Months, the relevant rate shall be determined by using a linear interpolation of the LIBOR according to usual practice in the international monetary market,

 

and, if such rate is below zero, LIBOR will be deemed to be zero.

 

Licence Subsidiary” shall mean any single purpose Wholly-Owned Subsidiary of the Borrower or of another Subsidiary of the Borrower, the sole business and operations of which single purpose Subsidiary is to hold one (1) or more Communications Licences, except where it is a mandatory condition of a Communications Licence in the relevant jurisdiction that any such entity is not such a vehicle (provided that, this exception shall not apply to any Communications Licence issued by the FCC or the ANFR).

 

Lien” means, with respect to any asset, any mortgage, leasehold mortgage, lien, pledge, charge, security interest, hypothecation or encumbrance of any kind in respect of such asset. For the purposes of this Agreement, a person shall be deemed to own subject to a Lien any asset which it has acquired or holds subject to the interest of a vendor or lessor under any conditional sale agreement, Capital Lease or other title retention agreement relating to such asset.

 

Liquidity” means the sum of Cash and Cash Equivalent Instruments held by any of the Obligors (other than Thermo), but excluding any amounts held in:

 

(a)the Debt Service Reserve Account; and

 

(b)the Insurance Proceeds Account.

 

Loans” means:

 

(a)a Facility A Loan; and

 

(b)a Facility B Loan,

 

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and, “Loan” means either of the foregoing as the context requires.

 

Loss Payee” has the meaning given to such term at Clause 21.4(c)(ii) (Launch Insurance).

 

Loss Payee Clause” means a loss payee clause in substantially the same form as set out in Schedule 28 (Loss Payee Clause).

 

LSP Direct Agreement” means the direct agreement dated 24 June 2009 between the Borrower, the Launch Services Provider and the Security Agent.

 

Majority Lenders” means:

 

(a)if there are no Loans then outstanding, a Lender or Lenders whose Commitments aggregate more than seventy five per cent. (75%) of the Total Commitments (or, if the Total Commitments have been reduced to zero, aggregated more than seventy five per cent. (75%) of the Total Commitments immediately prior to the reduction); or

 

(b)at any other time, a Lender or Lenders whose participations in the Loans then outstanding aggregate more than seventy five per cent. (75%) of all the Loans then outstanding.

 

Mandatory Cost” means any fee or cost payable by banks arising from any regulation imposed by:

   
 (a)the European Central Bank;
   
(b)the Financial Conduct Authority; or

 

(c)the Prudential Regulation Authority,

 

in each case, similar to those customarily considered to be “mandatory costs”.

 

Material Adverse Effect means with respect to the Borrower or any of its Subsidiaries, a material adverse effect on:

 

(a)the properties, business, operations, prospects or condition (financial or otherwise) of the Borrower and its Subsidiaries, taken as a whole; or

 

(b)the legality, validity or enforceability of any provision of any Transaction Document; or

 

(c)the rights and remedies of any Finance Party under any of the Finance Documents; or

 

(d)the security interests provided under the Security Documents or the value thereof; or

 

(e)its ability to perform any of its obligations under the Finance Documents,

 

provided that, existing and future first-generation satellite constellation degradation or failure issues and the effects thereof (which, for the avoidance of doubt, shall exclude any Satellite delivered under the Satellite Construction Contract) on the Borrower and its Subsidiaries, taken individually or collectively, shall not constitute a Material Adverse Effect.

 

Material Communications Licence” shall mean any Communications Licence, the loss, revocation, modification, non-renewal, suspension or termination of which, could be reasonably expected to have a Material Adverse Effect.

 

Material Contract” means:

 

(a)any contract or other agreement, written or oral, of the Borrower or any of its Subsidiaries involving monetary liability of or to any such person in an amount in excess of US$10,000,000 per annum; or

 

27
 

 

(b)any other contract or agreement, written or oral, of the Borrower or any of its Subsidiaries the failure to comply with which could reasonably be expected to have a Material Adverse Effect,

 

but excluding in either case any contract or other agreement that the Borrower or such Subsidiary may terminate on less than ninety (90) days notice without material liability.

 

Material Subsidiary” means:

 

(a)the Borrower;

 

(b)each Subsidiary Guarantor;

 

(c)Globalstar Canada Satellite Co.;

 

(d)each Licence Subsidiary (including, GCL Licensee LLC);

 

(e)any Subsidiary of the Borrower which, in the opinion of the COFACE Agent (acting reasonably), is of material operational or strategic importance to the business of the Group;

 

(f)any Subsidiary of the Borrower which has gross assets (excluding intra group items) representing ten per cent. (10%) or more of the gross assets of the Group; and

 

(g)any Subsidiary of the Borrower which has gross revenues per annum from all sources including intra-company revenues which are allocated to such Subsidiary of US$10,000,000 or more in aggregate.

 

For the purpose of paragraphs (f) and (g) above:

 

(i)subject to paragraph (ii) below:

 

(A)the contribution of a Subsidiary of the Borrower will be determined from its financial statements which were consolidated into the latest relevant financial statements; and

 

(B)the financial condition of the Group will be determined from the latest relevant financial statements;

 

(ii)if a Subsidiary of the Borrower becomes a member of the Group after the date on which the latest relevant financial statements were prepared:

 

(A)the contribution of the Subsidiary will be determined from its latest financial statements; and

 

(B)the financial condition of the Group will be determined from the latest relevant financial statements but adjusted to take into account any subsequent acquisition or disposal of a business or a company (including that Subsidiary);

 

(iii)the contribution of a Subsidiary will, if it has Subsidiaries, be determined from its consolidated financial statements;

 

(iv)if a Material Subsidiary disposes of all or substantially all of its assets to another member of the Group, it will immediately cease to be a Material Subsidiary and the other member of the Group (if it is not the Borrower or already a Material Subsidiary) will immediately become a Material Subsidiary;

 

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(v)a Subsidiary of the Borrower (if it is not already a Material Subsidiary) will become a Material Subsidiary on completion of any other intra-Group transfer or reorganisation if it would have been a Material Subsidiary had the intra-Group transfer or reorganisation occurred on the date of the latest relevant financial statements; and

 

(vi)except as specifically mentioned in paragraph (iv) above, a member of the Group will remain a Material Subsidiary until the next relevant financial statements show otherwise under paragraph (i) above.

 

If there is a dispute as to whether or not a member of the Group is a Material Subsidiary, a determination by the COFACE Agent will be, in the absence of manifest error, conclusive.

 

Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.

 

Month” means a period starting on one day in a calendar month and ending on the numerically corresponding day in the next calendar month, except that:

 

(a)(subject to paragraph (c) below) if the numerically corresponding day is not a Business Day, that period shall end on the next Business Day in that calendar month in which that period is to end if there is one, or if there is not, on the immediately preceding Business Day;

 

(b)if there is no numerically corresponding day in the calendar month in which that period is to end, that period shall end on the last Business Day in that calendar month; and

 

(c)if an Interest Period begins on the last Business Day of a calendar month, that Interest Period shall end on the last Business Day in the calendar month in which that Interest Period is to end.

 

The above rules will only apply to the last Month of any period.

 

Mortgages” means the collective reference to each mortgage, deed of trust or other real property security document, encumbering all real property now or hereafter owned by the Borrower or any Subsidiary, in each case, in form and substance reasonably satisfactory to the Security Agent and executed by the Borrower or any Subsidiary in favour of the Security Agent (for and on behalf of itself and the other Finance Parties), as any such document may be amended, restated, supplemented or otherwise modified from time to time.

 

Multiemployer Plan” means a “multiemployer plan” as defined in Section 4001(a)(3) of ERISA to which any Obligor or any ERISA Affiliate is making, or is accruing an obligation to make, or has accrued an obligation to make contributions, and each such plan for the six (6) year period immediately following the latest date on which any Obligor or ERISA Affiliate contributed to or had an obligation to contribute to such plan.

 

Net Cash Proceeds” means, as applicable:

 

(a)with respect to any Equity Issuance, any Asset Disposition or any Debt Issuance, the gross cash proceeds received by the Borrower or any of its Subsidiaries therefrom less all legal, underwriting, placement agents and other commissions, discounts, premiums, fees and expenses incurred in connection therewith; and

 

(b)with respect to any Insurance and Condemnation Event, the gross cash proceeds received by the Borrower or any of its Subsidiaries less the sum of:

 

(i)all fees and expenses in connection therewith; and

 

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(ii)the principal amount of, premium, if any, and interest on any Financial Indebtedness secured by a Lien on the asset (or a portion thereof) subject to such Insurance and Condemnation Event, which Financial Indebtedness is expressly permitted under this Agreement and required to be repaid in connection therewith.

 

Net Debt” means, in respect of the Group at any time, the consolidated amount of Financial Indebtedness, in each case, in cash and including:

 

(a)any vendor financings (howsoever described); and

 

(b)any Financial Indebtedness,

 

in each case, with a stated maturity prior to the Final Maturity Date, but:

 

(i)deducting the aggregate amount of Liquidity at that time; and

 

(ii)excluding any Subordinated Indebtedness but including any Relevant Subordinated Indebtedness.

 

Net Hedging Obligations” means, as of any date, the Termination Value of any such Hedging Agreement on such date.

 

New Lender” has the meaning given to such term in Clause 26.1 (Assignments and Transfers by the Lenders).

 

Obligations” means, in each case, whether now in existence or hereafter arising:

 

(a)the principal of and interest on (including interest accruing after the filing of any bankruptcy or similar petition) the Loans;

 

(b)all Hedging Obligations; and

 

(c)all other fees (including the Restructuring Fee and the COFACE Additional Insurance Premium) and commissions (including attorneys’ fees), charges, indebtedness, loans, liabilities, financial accommodations, obligations, covenants and duties owing by the Borrower or any of its Subsidiaries to the Finance Parties, in each case under any Finance Documents or otherwise, with respect to any Loan direct or indirect, absolute or contingent, due or to become due, contractual or tortuous, liquidated or unliquidated, and whether or not evidenced by any note.

 

Obligors” means:

 

(a)the Borrower;

 

(b)Thermo; and

 

(c)each Subsidiary Guarantor,

 

and, “Obligor” means any of the foregoing as the context requires.

 

OFAC” means the US Department of the Treasury’s Office of Foreign Assets Control.

 

Offshore Account Bank” has the meaning given to such term in the Accounts Agreement.

 

Onshore Account Bank” has the meaning given to such term in the Accounts Agreement.

 

Operating Lease” means, as to any person as determined in accordance with GAAP, any lease of property (whether real, personal or mixed) by such person as lessee which is not a Capital Lease.

 

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Original Indenture” means the indenture dated as of 15 April 2008 between the Borrower as issuer and U.S. Bank National Association as trustee.

 

Original Lenders” has the meaning given to such term in the Recitals.

 

Participating Member State” means any member state of the European Union that has the Euro as its lawful currency in accordance with legislation of the European Union relating to Economic and Monetary Union, other than Slovakia, Slovenia, Malta and Cyprus.

 

Party” means a party to this Agreement.

 

Payment Date” has the meaning given to such term in the Accounts Agreement.

 

Payment Period” means a First Half Payment Period or a Second Half Payment Period, as the case may be.

 

PBGC” means the Pension Benefit Guaranty Corporation or any successor agency.

 

Pension Plan” means any Employee Benefit Plan, other than a Multiemployer Plan, which is subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA.

 

Permitted Acquisition” means any investment by the Borrower, any Subsidiary Guarantor or Globalstar Canada Satellite Co. in the form of acquisition of all or substantially all of the business or a line of business (whether by the acquisition of Capital Stock, assets or any combination thereof) of any other person (a “Target Company”) if each such acquisition meets each of the following requirements:

 

(a)no less than fifteen (15) days prior to the proposed closing date of such acquisition, the Borrower shall have delivered written notice and financial details of such acquisition to the COFACE Agent, which notice shall include the proposed closing date of such acquisition;

 

(b)the Borrower shall have certified on or before the closing date of such acquisition, in writing and in a form reasonably acceptable to the COFACE Agent (acting on the instructions of the Majority Lenders), that such acquisition has been approved by the board of directors or equivalent governing body of the Target Company;

 

(c)the Target Company shall be in a substantially similar line of business as the Borrower and its Subsidiaries pursuant to Clause 22.12 (Nature of Business) or a parallel business the acquisition of which would be of commercial or strategic importance to such business;

 

(d)if such proposed transaction is a merger with respect to the Borrower or any Subsidiary Guarantor, the Borrower shall have received the prior written consent of the COFACE Agent to such transaction;

 

(e)such proposed transaction shall not include or result in any actual or contingent liabilities that could reasonably be expected to be material to the business, financial condition, operations or prospects of the Borrower and its Subsidiaries, taken as a whole;

 

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(f)if such proposed transaction is in respect of a Target Company which has negative Adjusted Consolidated EBITDA, the prior written consent of the COFACE Agent shall be required unless:

 

(i)such proposed transaction:

 

(A)is in respect of a Target Company which is an international gateway operator; and

 

(B)the cash consideration of such transaction does not exceed US$5,000,000 in value,

 

provided that, the Borrower shall only be permitted to enter into two (2) transactions of the type described in this paragraph (f)(i) in each Fiscal Year; or

 

(ii)the relevant Target Company (other than an international gateway operator) has for the twelve (12) Month period prior to the date of the proposed transaction a negative Adjusted Consolidated EBITDA no greater than US$2,000,000 in aggregate when taking into account all other acquisitions with negative Adjusted Consolidated EBITDA made following the date of this Agreement.

 

For the purpose of the calculations required to be made in respect of this paragraph (f) only:

 

(A)any reference to “the Borrower and its Subsidiaries” in the definitions of Consolidated EBITDA, Consolidated Net Income, Equity Issuance, Subordinated Indebtedness, Consolidated Interest Expense and Capital Lease (and any other definition used in the calculation of Adjusted Consolidated EBITDA) shall be construed as being a reference to “the Target Company and its Subsidiaries”;

 

(B)any reference to “the Borrower” in the definitions of Consolidated EBITDA, Consolidated Net Income, Equity Issuance, Subordinated Indebtedness, Consolidated Interest Expense and Capital Lease (and any other definition used in the calculation of Adjusted Consolidated EBITDA) shall be construed as being a reference to “the Target Company”; and

 

(C)any reference to “Subsidiary” in the definitions of Consolidated EBITDA, Consolidated Net Income, Equity Issuance, Subordinated Indebtedness, Consolidated Interest Expense and Capital Lease (and any other definition used in the calculation of Adjusted Consolidated EBITDA) shall be construed as being a reference to a Subsidiary of a Target Company;

 

(g)the Borrower shall have delivered to the COFACE Agent:

 

(i)no less than fifteen (15) days prior to the proposed closing date of such acquisition, forward looking financial statements taking into account the proposed transaction and demonstrating to the satisfaction of the COFACE Agent, compliance with each of the financial covenants set out in Clause 20 (Financial Covenants) on the proposed closing date of such acquisition and on a twelve (12) Month projected basis; and

 

(ii)such other documents reasonably requested by the COFACE Agent; and

 

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(h)no Event of Default shall have occurred and be continuing both before and after giving effect to such acquisition.

 

Permitted Joint Venture Investments” means any investment by the Borrower, any Subsidiary Guarantor or Globalstar Canada Satellite Co. in joint ventures and partnerships if each such investment meets all of the following requirements:

 

(a)no less than fifteen (15) days prior to the proposed closing date (in the case where the consent of the COFACE Agent and the Majority Lenders is required) or after the closing date (in the case where no consent is required) of any such investment of more than US$10,000,000, the Borrower shall have delivered written notice of such investment to the COFACE Agent, which notice shall include the proposed closing date (or actual closing date, applicable) of such investment;

 

(b)such joint venture or partnership shall be in a substantially similar line of business as the Borrower and its Subsidiaries pursuant to Clause 22.12 (Nature of Business) or a parallel business which is of commercial or strategic importance to such business;

 

(c)the Borrower shall have delivered to the COFACE Agent:

 

(i)such documents reasonably requested by the COFACE Agent or any Finance Party (through the COFACE Agent) pursuant to Clause 21.5 (Additional Domestic Subsidiaries) to be delivered at the time required pursuant to Clause 21.5 (Additional Domestic Subsidiaries);

 

(ii)forward looking financial statements taking into account the proposed transaction and demonstrating to the satisfaction of the COFACE Agent, compliance with each of the financial covenants set out in Clause 20 (Financial Covenants) on the proposed closing date of such investment and on a twelve (12) Month projected basis;

 

(d)no Event of Default shall have occurred and be continuing both before and after giving effect to such investment;

 

(e)if such investment is as a general partner, such investment shall be made by a Subsidiary that has no assets other than such investment; and in any case, such investment shall not include or result in any contingent liabilities that could reasonably be expected to be material to the business, financial condition, operations or prospects of the Borrower and its Subsidiaries, taken as a whole; and

 

(f)the Borrower shall have obtained the prior written consent of the COFACE Agent and the Majority Lenders prior to the consummation of such investment if the amount (including all cash and non-cash consideration paid by or on behalf of the Borrower and its Subsidiaries in connection with such investment) of such investment (or series of related investments), together with all other investments in joint ventures and partnerships consummated during the term of this Agreement, exceeds US$30,000,000 in aggregate (excluding any portion of such investment consisting of Capital Stock of the Borrower).

 

Permitted Liens” means the Liens permitted pursuant to Clause 22.2(a) to (t) (Limitations on Liens).

 

Permitted Supplier Indebtedness” means any Financial Indebtedness of the Borrower or any Subsidiary owing to the Supplier and relating to the Satellite Construction Contract.

 

Permitted Vendor Indebtedness” means:

 

(a)any Permitted Supplier Indebtedness; and

 

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(b)any Financial Indebtedness of the Borrower or any Subsidiary:

 

(i)owing to Ericsson pursuant to the purchase agreement between the Borrower and Ericsson dated 1 October 2008, as amended or any other agreement which replaces such agreement;

 

(ii)owing to Hughes pursuant to the agreement between the Borrower and Hughes dated 1 May 2008, as amended or any other agreement which replaces such agreement;

 

(iii)owing to a Satellite vendor or Satellite launch vendor or Affiliate thereof (in each case, other than the Supplier) for:

 

(A)the procurement, construction, launch and insurance of all or part of one or more Satellites or Satellite launches for such Satellites; or

 

(B)a ground or in-orbit space intended for future use or associated improvements to the ground portion of the network of the Borrower and its Subsidiaries;

 

(iv)owing to any other supplier or vendor in respect of any Capital Expenditure (but excluding the Supplier); or

 

(v)otherwise approved in writing by the COFACE Agent (acting on the instructions of all the Lenders),

 

provided that, in each case (other than paragraph (b)(v) above and unless stated to the contrary):

 

(A)in the case of paragraph (a) above only, such Permitted Supplier Indebtedness:

 

(1)does not exceed €17,530,000 (the “Relevant Amount”) and the Borrower must have consented to the payment to the Supplier of the Relevant Amount (or any lesser amount), it being acknowledged that the Borrower has no obligation to pay the Relevant Amount to the Supplier; and

 

(2)is on such terms as may be approved by the COFACE Agent (acting on the instructions of each Lender in their absolute discretion);

 

(B)in the case of paragraphs (b)(i) to (iv) (inclusive) only, such Financial Indebtedness does not exceed (either under any individual agreement or in aggregate) US$25,000,000 (unless approved in writing by the COFACE Agent (acting on the instructions of all the Lenders));

 

(C)the issuance of such Financial Indebtedness shall not cause, and could not reasonably be expected to cause, a Default;

 

(D)any interest payable in respect of such Financial Indebtedness does not exceed ten per cent. (10%) per annum;

 

(E)such Financial Indebtedness is not evidenced by any promissory note; and

 

(F)such Financial Indebtedness is not secured by any Lien (other than a Permitted Lien) on any asset or property of the Borrower or any Subsidiary thereof.

 

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PIK Interest” means interest paid by the Borrower or any Subsidiary in respect of a debt instrument by the issuance of:

 

(a)shares in the Borrower’s Capital Stock issued for the sole purpose of a making a dividend to the shareholders of the Borrower; and/or

 

(b)additional debt securities,

 

in each case:

 

(i)which debt securities will not mature or become payable prior to the maturity date of such instrument and the Final Discharge Date (other than in the case of the 5% Notes and the 8% Old Notes); and

 

(ii)no cash payment is made by the Borrower or any Subsidiary prior to the Final Discharge Date.

 

Project” means:

 

(a)the supply of twenty five (25) Satellites plus the long lead items for six (6) subsequent Satellites by the Supplier pursuant to the Satellite Construction Contract; and

 

(b)the launching of such Satellites by the Launch Services Provider pursuant to the terms of the Launch Services Contract,

 

to form for the Borrower the second generation satellite constellation.

 

Project Accounts” has the meaning given to such term in the Accounts Agreement.

 

Promissory Notes” means a promissory note made by the Borrower in accordance with Clause 31.2(c) (Evidence of Financial Indebtedness) in substantially (and in all material respects in) the same form as set out in Schedule 25 (Form of Promissory Note) and amendments, supplements and modifications thereto, any substitutes therefor, and any replacements, restatements, renewals or extension thereof, in whole or in part.

 

Property All Risks Insurance” means the insurance to be procured by the Borrower in accordance with Clause 21.4(c)(i) (Insurance).

 

Protected Party” means a Finance Party which is or will be subject to any liability, or required to make any payment, for or on account of Tax in relation to a sum received or receivable (or any sum deemed for the purposes of Tax to be received or receivable) under a Finance Document.

 

Prudential Regulation Authority” means the Bank of England body responsible for the prudential regulation and supervision of banks, building societies, credit unions, insurers and major investment firms.

 

Purchase Agreement” means the common stock purchase agreement dated as of 28 December 2012 between the Borrower and Terrapin.

 

Purchase Notice” has the meaning given to such term in the Fourth Supplemental Indenture.

 

Qualifying Certificate” means a certificate from the Supplier and/or the Launch Services Provider (as the case may be) substantially in the form set out in Schedule 18 (Qualifying Certificate) and signed by an Authorised Signatory of such person.

 

Qualifying Lender” means a Lender which is:

 

(a)a United States person (as defined in Section 7701(a)(30) of the Code);

 

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(b)engaged in a US trade or business with which such interest is “effectively connected” within the meaning of the Code;

 

(c)entitled in respect of payments of interest receivable by it under this Agreement to the benefit of a double taxation agreement with the United States which makes provision for full exemption from tax imposed by the United States on interest; or

 

(d)entitled to the benefit of the “portfolio interest” exemption under Section 871(h) or 881(c) of the Code.

 

Quotation Day” means, in relation to any period for which an interest rate is to be determined, two (2) Business Days before the first day of that period unless market practice differs in the London interbank market in which case the Quotation Day will be determined by the COFACE Agent in accordance with market practice in the London interbank market (and if quotations would normally be given by leading banks in the London interbank market on more than one day, the Quotation Day will be the last of those days).

 

Reference Bank Rate” means the arithmetic mean of the rates (rounded upwards to four decimal places) as supplied to the COFACE Agent at its request by the Reference Banks as the date at which the relevant Reference Bank could borrow funds in the London interbank market in the relevant currency and for the relevant period, were it to do so by asking for and then accepting interbank offers for deposits in reasonable market size in that currency and for that period.

 

Reference Banks” means the principal London offices of BNP Paribas, Société Générale, Crédit Industriel et Commercial, Crédit Agricole Corporate and Investment Bank and Natixis or such other banks as may be appointed by the COFACE Agent in consultation with the Borrower.

 

Relevant Period” means each period of six (6) Months or twelve (12) Months (as the case may be) referred to in each of the columns titled “Column 1 – Relevant Period” in the tables contained in Clauses 20.1 (Maximum Covenant Capital Expenditures), 20.3 (Adjusted Consolidated EBITDA), 20.4 (Debt Service Coverage Ratio) and 20.5 (Net Debt to Adjusted Consolidated EBITDA).

 

Relevant Subordinated Indebtedness” means any Subordinated Indebtedness the terms of which require the payment of:

 

(a)cash interest but excluding the payment of any cash interest under the 5% Notes or the 8% Old Notes which may become due to the relevant noteholders under the 5% Notes or the 8% Old Notes (as the case may be) following the maturity of, or the occurrence of a default pursuant to, and in accordance with, the terms of the indenture relating to the relevant Convertible Notes; or

 

(b)any fees but excluding any fees payable to an administrative agent of, or trustee for, any noteholders.

 

Repayment Date” has the meaning given to such term at Clause 6.1 (Repayment).

 

Repayment Schedule” means the repayment schedule set out at Schedule 29 (Repayment Schedule).

 

Repeating Representations” means each of the representations set out in Clauses 18.1 (Status), 18.2 (Binding Obligations), 18.3 (Non-Conflict with other Obligations), 18.4 (Power and Authority), 18.6 (Authorisations), 18.10 (Margin Stock), 18.11 (Government Regulation), 18.13 (Employee Relations), 18.14 (Burdensome Provisions), 18.18 (Titles to Properties), 18.23(a) (Satellites), 18.26 (OFAC), 18.27 (Governing Law and Enforcement), 18.31 (No Misleading Information), 18.33 (No Immunity) and 18.36(a) and (b) (Notes and Purchase Agreement).

 

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Reservations” means:

 

(a)the principle that equitable remedies may be granted or refused at the discretion of a court;

 

(b)the limitation of enforcement by laws relating to insolvency, reorganisation and other laws generally affecting the rights of creditors;

 

(c)the time barring of claims under applicable statutes of limitation;

 

(d)the possibility that an undertaking to assume liability for or indemnify a person against non-payment of stamp duty may be void;

 

(e)defences of set-off or counterclaim;

 

(f)a court construing a Lien expressed to be created by way of fixed security as being floating security;

 

(g)any additional interest imposed pursuant to any relevant agreement may be held to be irrecoverable on the grounds that it is a penalty;

 

(h)an English court may not give effect to any indemnity for legal costs incurred by an unsuccessful litigant; and

 

(i)equivalent principles, rights and defences under the laws of any relevant jurisdiction.

 

Responsible Officer” means the chief executive officer, president, chief financial officer, controller, treasurer or assistant treasurer of an Obligor or any other officer of an Obligor reasonably acceptable to the COFACE Agent. Any document delivered under this Agreement that is signed by a Responsible Officer of an Obligor shall be conclusively presumed to have been authorised by all necessary corporate, partnership and/or other action on the part of such Obligor and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Obligor.

 

Restructuring Fee” has the meaning given to such term in Clause 11.5 (Restructuring Fee).

 

Restructuring Support and Consent Agreement” means the equity commitment, restructuring, support and consent agreement dated 20 May 2013 between the Borrower, the Subsidiary Guarantors, the Security Agent, the COFACE Agent, the Lenders and Thermo.

 

S&P” means Standard & Poor’s Rating Services, a division of The McGraw-Hill Companies, Inc. and any successor thereto.

 

Sanctioned Entity” means:

 

(a)an agency of the government of;

 

(b)an organisation directly or indirectly controlled by; or

 

(c)a person resident in a country,

 

that is subject to a sanctions programme identified on the list maintained by OFAC and available at http://www.treas.gov/offices/enforcement/ofac/sanctions/index.html, or as otherwise published from time to time as such programme may be applicable to such agency, organisation or person.

 

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Sanctioned Person” shall mean a person named on the list of Specially Designated Nationals or Blocked Persons maintained by OFAC available at http://www.treas.gov/offices/enforcement/ofac/sdn/index.html, or as otherwise published from time to time.

 

Satellite” shall mean any single non-geostationary satellite, or group of substantially identical non-geostationary satellites, delivered or to be delivered by the Supplier to the Borrower pursuant to the Satellite Construction Contract and owned by, leased to or for which a contract to purchase has been entered into by, the Borrower or any of its Subsidiaries, whether such satellite is in the process of manufacture, has been delivered for Launch or is in orbit (whether or not in operational service) and including any replacement satellite of the Borrower following a Launch Failure delivered or to be delivered by:

 

(a)the Supplier to the Borrower pursuant to the Satellite Construction Contract; or

 

(b)a French supplier (other than the Supplier) pursuant to an agreement entered into by the Borrower with such French supplier which is permitted by the Finance Documents.

 

Satellite Construction Contract” means the satellite construction contract dated 30 November 2006 and made between the Borrower and the Supplier for the construction of forty eight (48) satellites, as amended and supplemented from time to time (and as further amended and restated on or about the date of this Agreement and delivered in satisfaction of the condition precedent set out at paragraph 7 (Commercial contracts) of Schedule 2 (Conditions Precedent)) for the purpose of, among other things, detailing a new phasing of the contract for the first twenty five (25) satellites and a final phase of twenty three (23) satellites.

 

Satellite Performance Criteria” means the criteria set out at Schedule 31 (Satellite Performance Criteria).

 

SCF Amount” has the meaning given to such term in Clause 7.3(a) (Mandatory Prepayment – Cash Sweep of Spectrum Cash Flow).

 

Scheduled Launch Period” means the three (3) Month contractual period during which a Satellite is scheduled to be launched in accordance with the Launch Services Contract.

 

Screen Rate” means the London interbank offered rate administered by the British Bankers’ Association (or any other person which takes over the administration of that rate) for Dollars for the relevant period displayed on pages LIBOR01 or LIBOR02 of the Reuters screen (or any replacement Reuters page which displays that rate) or on the appropriate page of such other information service which publishes that rate from time to time in place of Reuters. If such page or service ceases to be available, the COFACE Agent may specify another page or service displaying the relevant rate after consultation with the Borrower and the Lenders.

 

Second Half Payment Period” means the period from 1 July to 31 December (inclusive) in any calendar year.

 

Second Half 2017 Payment Period” means the Second Half Payment Period occurring in the calendar year of 2017.

 

Security Amendment and Restatement Agreement” means the amendment and restatement agreement in respect of the Collateral Agreement and the Stock Pledge Agreement to be entered into prior to the Effective Date between the Borrower, each Domestic Subsidiary and the Security Agent.

 

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Security Documents” means:

 

(a)the Collateral Agreement;

 

(b)each Mortgage;

 

(c)the Borrower Pledge of Bank Accounts;

 

(d)the Borrower Additional Pledge of Bank Accounts;

 

(e)the Holding Account Pledge Agreement;

 

(f)each Account Control Agreement;

 

(g)the Stock Pledge Agreement;

 

(h)each Landlord Waiver and Consent Agreement;

 

(i)each Delegation Agreement;

 

(j)all other agreements conferring, or purporting to confer, security in favour of the Finance Parties with respect to the obligations of the Borrower under the Finance Documents entered into after the date of this Agreement as required by the terms of this Agreement;

 

(k)all agreements and other documents executed from time to time pursuant to any of the foregoing; and

 

(l)any other agreement or document which the Security Agent and the Borrower (acting reasonably) from time to time designate as a “Security Document” for the purposes of this Agreement,

 

and, “Security Document” means any of the foregoing as the context requires.

 

Shareholder Distributions” means:

 

(a)any dividend paid, made or declared, other than a dividend paid exclusively in Capital Stock or rights to acquire Capital Stock which, in each case, no cash payment is made by the Borrower;

 

(b)any payment by way of return on or repayment of share capital;

 

(c)any payment of cash interest or capitalised interest by the Borrower to any member of the Thermo Group under any distribution (whether in cash or in kind), including, without limitation, any distribution of assets or other payment whatsoever in respect of share capital whether directly or indirectly but excluding:

 

(i)any distributions or other payments pursuant to any employee stock incentive plan (howsoever described) expressly permitted under the terms of this Agreement;

 

(ii)any PIK Interest relating to:

 

(A)the Thermo Loan Agreement; or

 

(B)any Convertible Note held by Thermo; and

 

(iii)any cash interest relating to any Convertible Note held by Thermo and permitted by the terms of this Agreement;

 

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(d)any redemption, cancellation or repurchase of the Borrower’s shares or any class of its shares other than any conversion on mandatory repurchase or redemption of any of the Convertible Notes in accordance with their terms or in connection with any employee stock incentive plan (howsoever described) expressly permitted under the terms of this Agreement; and

 

(e)any payments under a subordinated loan (including interest and fees).

 

Solvent” and “Solvency” means, with respect to any person on any date of determination, that on such date:

 

(a)the fair value of the assets of such person is greater than the total amount of liabilities, including contingent liabilities, of such person;

 

(b)the present fair saleable value of the assets of such person is not less than the amount that will be required to pay the probable liability of such person on its debts as they become absolute and matured;

 

(c)such person does not intend to, and does not believe that it will, incur debts or liabilities beyond such person’s ability to pay such debts and liabilities as they mature;

 

(d)such person is not engaged in business or a transaction, and is not about to engage in business or a transaction, for which such person’s assets would constitute an unreasonably small capital; and

 

(e)such person is able to pay its debts and liabilities, contingent obligations and other commitments as they mature in the ordinary course of business.

 

The amount of contingent liabilities at any time shall be computed as the amount that, in the light of all the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability.

 

Spectrum” means spectrum in specific frequency bands that are subject to a Communications Licence issued to the Borrower or an Affiliate, and in the case of spectrum licensed by the FCC, this refers to, without limitation, spectrum that is licensed to the Borrower or an Affiliate in the 1610-1618.725 and the 2483.5 – 2500 MHz frequency bands.

 

Spectrum Cash Flow” means any cash received by a member of the Group from monetizing (howsoever defined) the Group’s Spectrum rights, including, but not limited to, upfront payments, operating lease payments, and any other payments to a member of the Group associated with the commercial use of any Spectrum by any third parties: less

 

(a)any capital or operating expenses incurred (or reasonably expected to be incurred) by the Borrower in direct connection with such Spectrum Cash Flow; and

 

(b)any payments received by a member of the Group under such Spectrum Cash Flow which are to be “passed through” to any third party,

 

provided that all such deductions (including deducted expenses incurred and “passed through” payments) must:

 

(i)be directly related to the corresponding monetization of Spectrum rights;

 

(ii)be approved in good faith by the COFACE Agent (acting on the instructions of the Majority Lenders) in the exercise of their commercially reasonable judgment; and

 

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(iii)not have been deducted from the calculation of Excess Cash Flow (without double counting).

 

Spectrum Sale” means any sale or other disposition of title (legal or equitable) of any of the Group’s Spectrum rights.

 

Spot Rate of Exchange” means the exchange rate between Euros and Dollars as notified by the COFACE Agent to the Borrower and calculated on the basis of the official fixing rate (as between Euros and Dollars) of the European Central Bank quoted on Reuter’s page ECB37, more or less two (2) basis points, on the date that is two (2) Business Days prior to the relevant Utilisation Date. If the agreed page is replaced or the service ceases to be available, the COFACE Agent may specify another page or service displaying the appropriate rate.

 

Stock Pledge Agreement” means the stock pledge agreement dated 22 June 2009 (as supplemented by the Joinder Agreement and as amended and restated by the Security Amendment and Restatement Agreement) between the Borrower, each Domestic Subsidiary and the Security Agent.

 

Subordinated Indebtedness” means any Financial Indebtedness of the Borrower or any Subsidiary:

 

(a)subordinated in right and time of payment to the Obligations pursuant to an Acceptable Intercreditor Agreement (including, for the avoidance of doubt, the provisions of any subordinated subsidiary guarantees provided in connection with the 8% New Notes pursuant to the provisions of Clause 22.1(1) (Limitations on Financial Indebtedness) (provided that the Borrower shall be entitled to pay PIK Interest);

 

(b)to be applied by the Borrower or the relevant Subsidiary (as the case may be) towards:

 

(i)financing costs directly arising from the construction and Launch of the Satellites or additional satellites;

 

(ii)financing payments due by the Borrower to second generation ground segment vendors; and/or

 

(iii)payment of the Borrower’s working capital and general corporate purposes;

 

(c)containing such other terms and conditions, in each case as are reasonably satisfactory to the COFACE Agent; and

 

(d)the issuance of such Financial Indebtedness shall not cause, and could not reasonably be expected to cause, a Default.

 

Subsidiary” means, as to any person, any company of which more than fifty per cent. (50%) of the outstanding Capital Stock having ordinary voting power to elect a majority of the board of directors or other managers of such person is at the time owned (directly or indirectly) by, or the management is otherwise controlled by, such person (irrespective of whether, at the time, Capital Stock of any other class or classes of such person shall have or might have voting power by reason of the occurrence of any contingency). Unless otherwise qualified, references to “Subsidiary” or “Subsidiaries” in this Agreement shall refer to those of the Borrower.

 

Subsidiary Guarantor” means each direct or indirect Domestic Subsidiary of the Borrower:

 

(a)set out in Schedule 26 (Subsidiary Guarantors); or

 

(b)which becomes a party to a Guarantee Agreement pursuant to Clause 21.5 (Additional Domestic Subsidiaries).

 

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Subsidiary Guarantor Subordination Deed” means the subordination deed dated on or around the Effective Date and made between the Subsidiary Guarantors, the Borrower, the Security Agent and the COFACE Agent.

 

Supplier” means Thales Alenia Space France, a French société par actions simplifiée registered at the Registre du Commerce et des Société of Toulouse under registration number 414 725 101, whose registered office is at 26, Avenue Jean François Champollion, 31100 Toulouse, France.

 

Supplier Direct Agreement” means the direct agreement dated 5 June 2009 between the Borrower, the Supplier and the Security Agent.

 

Synthetic Lease” means any synthetic lease, tax retention operating lease, off-balance sheet loan or similar off-balance sheet financing product where such transaction is considered borrowed money indebtedness for tax purposes but is classified as an Operating Lease in accordance with GAAP.

 

Target Company” has the meaning given to such term in the definition of “Permitted Acquisition”.

 

Tax” means any tax, levy, impost, duty, fee, assessment or other charge or withholding of a similar nature (including any penalty or interest payable in connection with any failure to pay or any delay in paying any of the same).

 

Tax Credit” means a credit against, relief or remission for, or repayment of any Tax.

 

Tax Deduction” means a deduction or withholding for or on account of Tax from a payment under a Finance Document, other than a FATCA Deduction.

 

Tax Payment” means either the increase in a payment made by the Borrower to a Finance Party under Clause 13.1 (Tax Gross-up) or a payment under Clause 13.2 (Tax Indemnity).

 

Terrapin” means Terrapin Opportunity, L.P.

 

Termination Value” means, in respect of any one (1) or more Hedging Agreements, after taking into account the effect of any legally enforceable netting agreement relating to such Hedging Agreements:

 

(a)for any date on or after such Hedging Agreements have been closed out and termination value(s) determined in accordance therewith, such termination value(s); and

 

(b)for any date prior to the date referenced in paragraph (a), the amount(s) determined as the mark-to-market value(s) for such Hedging Agreements, as determined based upon one (1) or more mid-market or other readily available quotations provided by any recognised dealer in such Hedging Agreements (which may include a Lender or an Affiliate of a Lender).

 

Thermo” means Thermo Funding Company LLC.

 

Thermo Group” means:

 

(a)Globalstar Satellite LP;

 

(b)Thermo;

 

(c)FL Investment Holdings LLC (formerly known as Globalstar Holdings LLC); and

 

(d)Thermo Funding II LLC.

 

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Thermo Group Undertaking Letter” means the undertaking letter dated on or around the Effective Date entered into by each of the members of the Thermo Group in favour of the COFACE Agent.

 

Thermo Loan Agreement” means the loan agreement dated 25 June 2009 between the Borrower as borrower and Thermo as lender, as the same may be amended from time to time, and the subordinated promissory note evidencing such loan.

 

Thermo Subordination Deed” means the subordination deed dated 22 June 2009 (as amended and restated pursuant to the Global Deed of Amendment and Restatement) made between Thermo, the Borrower, the Security Agent and the COFACE Agent.

 

Third Parties Act” has the meaning given to such term in Clause 1.5(a) (Third Party Rights).

 

Total Commitments” means the aggregate of:

 

(a)the Total Facility A Commitments; and

 

(b)the Total Facility B Commitments.

 

Total Facility A Commitments” means the aggregate of the Facility A Commitments, being US$563,299,120 as at the date of this Agreement.

 

Total Facility B Commitments” means the aggregate of the Facility B Commitments, being US$23,042,880 as at the date of this Agreement.

 

Transaction Costs” means all transaction fees, charges and other amounts related to the Facilities or any transaction which, if consummated, would be a Permitted Acquisition or a Permitted Joint Venture Investment (including, without limitation, any financing fees, merger and acquisition fees, legal fees and expenses, due diligence fees or any other fees and expenses in connection therewith).

 

Transaction Documents” means:

 

(a)each Finance Document;

 

(b)each Commercial Contract;

 

(c)any Acceptable Intercreditor Agreement; and

 

(d)each Material Communications Licence,

 

and, “Transaction Document” means any of the foregoing as the context requires.

 

Transfer Certificate” means a certificate substantially in the form set out in Part A (Form of Transfer Certificate) of Schedule 5 (Form of Transfer Certificate and Assignment Agreement) or any other form agreed between the COFACE Agent and the Borrower (acting reasonably).

 

Transfer Date” means, in relation to an assignment or a transfer, the later of:

 

(a)the proposed Transfer Date specified in the relevant Assignment Agreement or Transfer Certificate; and

 

(b)the date on which the COFACE Agent executes the relevant Assignment Agreement or Transfer Certificate.

 

UCC” means the Uniform Commercial Code as in effect in the State of New York, as amended or modified from time to time.

 

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Unfunded Pension Liability” of any Pension Plan means the excess of such Pension Plan’s benefit liabilities under Section 4001(a)(16) of ERISA over the current value of such Pension Plan’s assets, determined in accordance with the assumptions used for funding such Pension Plan pursuant to Section 412 of the Code for the applicable plan year.

 

Unpaid Sum” means any sum due and payable but unpaid by the Borrower under the Finance Documents.

 

United States” or “US” means the United States of America.

 

US Tax Obligor” means:

 

(a)a borrower which is resident for tax purposes in the United States of America; or

 

(b)an Obligor some or all of whose payments under the Finance Documents are from sources within the United States for US federal income tax purposes.

 

Utilisation” means a utilisation of a Facility.

 

Utilisation Date” means the date of a Utilisation, being the date on which the relevant Loan is to be made.

 

Utilisation Request” means a notice substantially in the form set out in Schedule 3 (Utilisation Request).

 

VAT” means:

 

(a)any tax imposed in compliance with Council Directive of 28 November 2006 on the common system of value added tax (EC Directive 2006/112); and

 

(b)any other tax of a similar nature, whether imposed in a member state of the European Union in substitution for, or levied in addition to, such tax referred to in paragraph (a) above, or imposed elsewhere.

 

Wholly-Owned” means, with respect to a Subsidiary, that all the shares of the Capital Stock of such Subsidiary are, directly or indirectly, owned or controlled by the Borrower and/or one (1) or more of its Wholly-Owned Subsidiaries (except for directors’ qualifying shares or other shares required by Applicable Law to be owned by a person other than the Borrower).

 

Withholding Forms means United States Internal Revenue Service (“IRS”) Form W-8BEN, W-8ECI or W-9 (or, in each case, any successor form and, in each case, attached to an IRS Form W-8IMY if required) or any other IRS form by which a person may claim an exemption from withholding of US federal income tax on interest payments to that person and, in the case of a person claiming an exemption under the “portfolio interest exemption”, a statement certifying that such person is not a “bank” within the meaning of Section 881(c)(3)(A) of the Internal Revenue Code of 1986, as amended.

 

Working Capital” means, on any date, Current Assets less Current Liabilities.

 

1.2Construction

 

(a)Unless a contrary indication appears, any reference in this Agreement to:

 

(i)annual” means a period of twelve (12) Months;

 

(ii)the “COFACE Agent”, any “Finance Party”, any “Lender”, any “Mandated Lead Arranger”, an “Obligor”, any “Party” or the “Security Agent” shall be construed so as to include its successors in title, permitted assigns and permitted transferees;

 

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(iii)assets” includes present and future properties, revenues and rights of every description;

 

(iv)determines” or “determined” means a determination made in the absolute discretion of the person making the determination;

 

(v)the “equivalent” on any given date in one currency (the “first currency”) of an amount denominated in another currency (the “second currency”) is a reference to the amount of the first currency which could be purchased with the second currency at the Spot Rate of Exchange for the purchase of the first currency with the second currency;

 

(vi)a “Finance Document” or any other agreement or instrument is a reference to that Finance Document or other agreement or instrument as amended, novated, supplemented, extended or restated;

 

(vii)guarantee” means any guarantee, letter of credit, bond, indemnity or similar assurance against loss, or any obligation, direct or indirect, actual or contingent, to purchase or assume any indebtedness of any person or to make an investment in or loan to any person or to purchase assets of any person where, in each case, such obligation is assumed in order to maintain or assist the ability of such person to meet its indebtedness;

 

(viii)include” or “including” are to be construed without limitation;

 

(ix)indebtedness” includes any obligation (whether incurred as principal or as surety) for the payment or repayment of money, whether present or future, actual or contingent;

 

(x)a “person” includes any individual, firm, company, corporation, government, state or agency of a state or any association, trust, joint venture, consortium or partnership (whether or not having separate legal personality);

 

(xi)a “regulation” includes any regulation, rule, official directive, request or guideline (whether or not having the force of law) of any governmental, intergovernmental or supranational body, agency, department or of any regulatory, self-regulatory or other authority or organisation;

 

(xii)a provision of law is a reference to that provision as amended or re-enacted;

 

(xiii)a time of day is a reference to Paris time; and

 

(xiv)the “date of this Agreement” shall be a reference to the original date of this Agreement, being 5 June 2009.

 

(b)Section, Clause and Schedule headings are for ease of reference only.

 

(c)Unless a contrary indication appears, a term used in any other Finance Document or in any notice given under or in connection with any Finance Document has the same meaning in that Finance Document or notice as in this Agreement.

 

(d)A Default (other than an Event of Default) is “continuing” if it has not been remedied or waived and an Event of Default is “continuing” if it has not been waived.

 

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1.3Accounting Terms

 

All accounting terms not specifically or completely defined in this Agreement shall be construed in conformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with, GAAP applied on a consistent basis, as in effect from time to time, applied in a manner consistent with that used in preparing the audited financial statements required by Clause 19.2 (Annual Financial Statements), except as otherwise specifically prescribed in this Agreement.

 

1.4UCC Terms

 

Terms defined in the UCC in effect on the date of this Agreement and not otherwise defined in this Agreement shall, unless the context otherwise indicates, have the meanings provided by those definitions. Subject to the foregoing, the term “UCC” refers, as of any date of determination, to the UCC then in effect.

 

1.5Third Party Rights

 

(a)Unless expressly provided to the contrary in a Finance Document a person who is not a Party has no right under the Contracts (Rights of Third Parties) Act 1999 (the “Third Parties Act”) to enforce or to enjoy the benefit of any term of this Agreement.

 

(b)Notwithstanding any term of any Finance Document the consent of any person who is not a Party is not required to rescind or vary this Agreement at any time.

 

2.The Facilities

 

2.1Facility A and Facility B

 

Subject to the terms of this Agreement and the Global Deed of Amendment and Restatement, the Lenders make available to the Borrower a:

 

(a)Dollar term loan facility in an aggregate amount equal to the Total Facility A Commitments (“Facility A”); and

 

(b)Dollar term loan facility in an aggregate amount equal to the Total Facility B Commitments (“Facility B”).

 

2.2Finance Parties’ Rights and Obligations

 

(a)The obligations of each Finance Party (other than the Lenders) under the Finance Documents are several. Failure by a Finance Party (other than a Lender) to perform its obligations under the Finance Documents does not affect the obligations of any other Party under the Finance Documents. No Finance Party (other than a Lender) is responsible for the obligations of any other Finance Party (other than a Lender) under the Finance Documents.

 

(b)The obligations of each Lender under the Finance Documents are joint and several. Each Party agrees that this Clause 2.2(b) is for the benefit of the Lenders only and the Borrower acknowledges that it has no rights of any kind whatsoever under this Clause 2.2(b).

 

(c)The rights of each Finance Party under or in connection with the Finance Documents are separate and independent rights and any debt arising under the Finance Documents to a Finance Party from an Obligor shall be a separate and independent debt.

 

(d)A Finance Party may, except as otherwise stated in the Finance Documents, separately enforce its rights under the Finance Documents.

 

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2.3Commercial Contracts

 

Each Party acknowledges that the Finance Parties shall have no responsibility or liability whatsoever regarding any performance or non-performance by any party to a Commercial Contract and that the Finance Parties shall have no obligation to intervene in any dispute in connection with or arising out of such performance or non-performance. Any such dispute shall not affect the Borrower’s performance under this Agreement nor entitle the Borrower to any suspension or other claim towards the Finance Parties.

 

3.Purpose

 

3.1Purpose – Facility A

 

The Borrower shall apply all amounts borrowed by it under Facility A towards:

 

(a)Payments to the Supplier

 

payment to the Supplier of the Eligible Amounts in excess of such amounts already paid by the Borrower to the Supplier. Such Eligible Amount shall be payable by way of direct disbursement to the Supplier in accordance with the terms of the Satellite Construction Contract;

 

(b)Reimbursement to the Borrower

 

reimbursement to the Borrower of the Eligible Amounts already paid directly by the Borrower to the Supplier in excess of the Advance Payment. Such Eligible Amounts shall be payable by way of direct disbursement to the Borrower. Subject to Clause 3.4(b) (Sub-Limits), any amounts received by the Borrower by way of reimbursement may only be applied by the Borrower as follows:

 

(i)towards payment to the Launch Services Provider of amounts not funded by Facility B in an amount not exceeding US$216,000,000;

 

(ii)towards payment to Hughes in an amount not exceeding US$87,000,000;

 

(iii)towards payment to Ericsson in an amount not exceeding US$8,000,000; and

 

(iv)towards payment of the Borrower’s working capital and general corporate purposes in an amount not exceeding US$150,000,000,

 

and, in each case, such additional amounts as COFACE may agree; and

 

(c)Payment of the COFACE Insurance Premia

 

payment to the COFACE Agent (for the account of COFACE) of an amount equal to one hundred per cent. (100%) of the COFACE Insurance Premia with respect to Facility A, being the amount specified by COFACE,

 

in each case, in accordance with the terms of this Agreement.

 

3.2Purpose – Facility B

 

The Borrower shall apply all amounts borrowed by it under Facility B towards:

 

(a)Payments to the Launch Services Provider

 

payment to the Launch Services Provider of the Eligible Amounts. Such Eligible Amount shall be payable by way of direct disbursement to the Launch Services Provider in accordance with the terms of the Launch Services Contract; and

 

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(b)Payment of the COFACE Insurance Premia

 

payment to the COFACE Agent (for the account of COFACE) of an amount equal to one hundred per cent. (100%) of the COFACE Insurance Premia with respect to Facility B, being the amount specified by COFACE,

 

in each case, in accordance with the terms of this Agreement.

 

3.3Monitoring

 

No Finance Party is bound to monitor or verify the application of any amount borrowed pursuant to this Agreement.

 

3.4Sub-Limits

 

The aggregate amount that the Borrower may utilise under:

 

(a)Clause 3.1(a) (Payments to the Supplier) and Clause 3.1(b) (Reimbursement to the Borrower) shall not exceed US$528,026,844;

 

(b)Clause 3.1(b) (Reimbursement to the Borrower) shall not exceed US$309,543,626; and

 

(c)Clause 3.2(a) (Payments to the Launch Services Provider) shall not exceed US$21,600,000.

 

4.Conditions of Utilisation

 

4.1Initial Conditions Precedent

 

The Borrower shall not deliver a Utilisation Request unless the COFACE Agent has received all of the documents and other evidence listed in Schedule 2 (Conditions Precedent) in form and substance satisfactory to the COFACE Agent. The COFACE Agent shall notify the Borrower and the Lenders promptly upon being so satisfied.

 

4.2Further Conditions Precedent

 

The Lenders will only be obliged to comply with Clause 5.6 (Lenders’ Participation) if on the date of the Utilisation Request and on the proposed Utilisation Date:

 

(a)no Default is continuing or would be likely to result from the proposed Loan;

 

(b)the Repeating Representations to be made by the Borrower are true in all material respects;

 

(c)the credit insurance cover under the COFACE Insurance Policy extended by COFACE in favour of the Lenders in respect of each Facility is in full force and effect and has not been suspended or cancelled, and the COFACE Agent shall, in its sole discretion, be satisfied that all conditions of the COFACE Insurance Policy and of the credit insurance cover with respect to such COFACE Insurance Policy have been satisfied in full and that the credit insurance coverage will apply to such Utilisation;

 

(d)each Commercial Contract is in full force and effect and has not been suspended, interrupted, cancelled, terminated, amended or modified in any material respect (otherwise than as authorised by the COFACE Agent) and no arbitration or other legal proceedings have been initiated between the Borrower and the Supplier and/or Launch Services Provider (as the case may be) in respect of a Commercial Contract;

 

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(e)for any Utilisation Request made for the purpose referred to in Clause 3.1(b) (Reimbursement to the Borrower), the COFACE Agent shall have received evidence that the payment to the Supplier of the corresponding Invoices has been made;

 

(f)each of the documents, information and other evidence specified in and required to be enclosed with each Utilisation Request and Qualifying Certificate, together with any other documents, information or evidence requested by the COFACE Agent (on behalf of the Lenders) and/or the French Authorities from time to time, shall have been delivered to the COFACE Agent (in form and substance satisfactory to the COFACE Agent);

 

(g)the Borrower shall have paid or arranged for payment when due:

 

(i)all fees, costs, expenses, charges and other amounts due and payable by it under this Agreement on the Utilisation Date for such Utilisation; and

 

(ii)any and all other amounts due and payable under this Agreement on such Utilisation Date, and

 

(iii)the Borrower shall have delivered to the COFACE Agent such evidence of payment as the COFACE Agent may reasonably request; and

 

(h)in respect of any payment to the Supplier, the Launch Services Provider and/or the Borrower in accordance with Clauses 3.1(a) (Payments to the Supplier), 3.1(b) (Reimbursement to the Borrower) and 3.2(a) (Payments to the Launch Services Provider), the Supplier and/or the Launch Services Provider (as the case may be) has delivered to the COFACE Agent a Qualifying Certificate, which:

 

(i)conforms to the amount and payment timing specified in the relevant Utilisation Request; and

 

(ii)to the extent applicable, specifies whether such Loan is to be applied in payment:

 

(A)of a portion of the Contract Price directly to the Supplier or the Launch Services Provider (as the case may be); or

 

(B)by reimbursement to the Borrower to the account directed by the Borrower in the Utilisation Request of any portion of the Contract Price paid by the Borrower to the Supplier or the Launch Services Provider (as the case may be);

 

(i)a certificate from a Responsible Officer certifying that each of the eight (8) Satellites referred to in Schedule 16 (Satellites) has been launched, is in-service and is fully operational (in form and substance satisfactory to the COFACE Agent); and

 

(j)the conditions in Clause 5 (Utilisation) have been fulfilled.

 

The COFACE Agent shall notify the Borrower and the Lenders promptly upon being so satisfied.

 

4.3Conditions Precedent to Certain Utilisations

 

The Lenders will only be obliged to comply with Clause 5.6 (Lenders’ Participation) if on the date of the Utilisation Request and on the proposed Utilisation Date:

 

(a)no later than one hundred and twenty (120) days prior to the first day of the Scheduled Launch Period, the COFACE Agent shall have received the drafts of the Launch Insurance Documentation, in compliance with the provisions of Clause 21.4 (Insurance) and in form and substance satisfactory to the COFACE Agent; and

 

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(b)no later than ninety (90) days prior to each scheduled Launch date, the Borrower shall have delivered to the COFACE Agent the Launch Insurance Documentation duly executed by each party thereto together with:

 

(i)the Loss Payee Clause;

 

(ii)each certificate in respect of the Launch Insurance Documentation referred to in Clause 21.4(c)(ii) (Launch Insurance); and

 

(iii)evidence that all premia due at that time has been paid in full in compliance with Clause 21.4(c)(ii) (Launch Insurance) and in form and substance satisfactory to the COFACE Agent.

 

4.4Failure to Satisfy Conditions Precedent

 

(a)The Borrower agrees that all the initial conditions precedent referred to in Clause 4.1 (Initial Conditions Precedent) must be fulfilled within sixty (60) days of the date of this Agreement.

 

(b)Subject to paragraph (c) below, if the Borrower is unable to fulfil any such conditions precedent within such sixty (60) day time period, each Lender’s Commitment shall be immediately cancelled and each Lender shall have no further obligations under this Agreement.

 

(c)Each Lender’s Commitment shall not be cancelled pursuant to paragraph (b) above if each of the initial conditions precedent has been satisfied by the Borrower except for the condition precedent referred to in paragraph 8 (COFACE Insurance Policy) of Schedule 2 (Conditions Precedent) but only to the extent that the COFACE Insurance Policy has not been issued by COFACE for a reason not attributable to a breach by the Borrower of the terms of the COFACE Insurance Policy.

 

5.Utilisation

 

5.1Delivery of a Utilisation Request

 

(a)Subject to the terms of the Global Deed of Amendment and Restatement, the Borrower may utilise a Facility by delivery to the COFACE Agent of a duly completed Utilisation Request not later than 11:00 a.m. (Paris time) ten (10) Business Days prior to the proposed Utilisation Date.

 

(b)Each Utilisation Request shall instruct the COFACE Agent to remit the amount utilised on behalf of the Borrower to:

 

(i)the Supplier and/or the Launch Services Provider’s account, as the case may be, as part of the payment of the relevant Contract Price; or

 

(ii)in relation to a reimbursement to the Borrower under Facility A, such account as directed by the Borrower in the Utilisation Request.

 

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5.2Borrower’s Mandate

 

(a)The Borrower irrevocably authorises and mandates the COFACE Agent (on its behalf and for its account):

 

(i)in the case of Facility A:

 

(A)to pay the Supplier with respect to any Eligible Amount under the Satellite Construction Contract, upon presentation of the documents set out in Schedule 11 (Payment Terms);

 

(B)to reimburse the Borrower for any payments in respect of Eligible Goods and Services under the Satellite Construction Contract which exceed fifteen per cent. (15%) of the Satellite Construction Contract’s Contract Price; and

 

(C)to pay to the COFACE Agent the COFACE Insurance Premia;

 

(ii)in the case of Facility B:

 

(A)to pay the Launch Services Provider with respect to any Eligible Amount under the Launch Services Contract, upon presentation of the documents set out in Schedule 11 (Payment Terms); and

 

(B)to pay to the COFACE Agent the COFACE Insurance Premia.

 

(b)This mandate is irrevocable.

 

(c)The payment terms set out in Schedule 11 (Payment Terms) may only be amended with the prior written consent of the COFACE Agent (acting on the instructions of all the Lenders).

 

(d)The Borrower agrees that any Utilisation made under or pursuant to this Clause 5 shall be deemed to have been made to or for the benefit of the Borrower and the Borrower waives all rights of protest it may have to the contrary.

 

5.3Examination of Documents

 

(a)The COFACE Agent’s role in examining the documents set out in Schedule 11 (Payment Terms) shall be limited to verifying that such documents appear on their face to be what is indicated in such Schedule 11 (Payment Terms) and the COFACE Agent shall bear no other responsibility in connection thereof. Such role shall be construed in accordance with the terms of Article 14 of the Uniform Customs and Practice for Documentary Credits of the International Chamber of Commerce 2007 Revision (Publication 600).

 

(b)The COFACE Agent and the Lenders shall not be responsible for any delay in making available any Loans resulting from any requirement for the delivery of further information or documents required by the COFACE Agent to confirm the relevant conditions precedent in this Agreement have been met.

 

5.4Completion of a Utilisation Request

 

(a)Subject to the terms of the Global Deed of Amendment and Restatement, each Utilisation Request is irrevocable and will not be regarded as having been duly completed unless:

 

(i)the proposed Utilisation Date is a Business Day within the Availability Period applicable to that Facility; and

 

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(ii)the currency and amount of the Utilisation comply with Clause 5.5 (Currency and Amount).

 

(b)Only one (1) Loan may be requested in each Utilisation Request.

 

(c)The Borrower may only deliver one (1) Utilisation Request in each Month in respect of each Facility.

 

5.5Currency and Amount

 

In the case of:

 

(a)Payments to the Supplier

 

any Utilisation to be made in accordance with Clause 3.1(a) (Payments to the Supplier), the Loan requested in a Utilisation Request must be in Dollars. Each payment to the Supplier by the COFACE Agent shall be made in Dollars;

 

(b)Payments to the Launch Services Provider

 

any Utilisation to be made in accordance with Clause 3.2(a) (Payments to the Launch Services Provider), the Loan requested in a Utilisation Request must be in Dollars. Each payment to the Launch Services Provider by the COFACE Agent shall be made in Dollars;

 

(c)Reimbursement to the Borrower

 

any Utilisation to be made in accordance with Clause 3.1(b) (Reimbursement to the Borrower), the Loan requested in a Utilisation Request must be in Dollars. The Borrower shall confirm in each such Utilisation Request that the requested Dollar amount is the Dollar equivalent of the relevant Euro amount applying a Euro to Dollar exchange rate of one (1) Euro for US$1.34. Each Utilisation made pursuant to Clause 3.1(b) (Reimbursement to the Borrower) shall be made in Dollars;

 

(d)Facility A – Payment of the COFACE Insurance Premia

 

any Utilisation to be made in accordance with Clause 3.1(c) (Payment of the COFACE Insurance Premia), the Loan requested in a Utilisation Request must be, subject to Clause 12.3(d) (Borrower’s Payment Obligations), US$35,272,276. Any payment to COFACE of the COFACE Insurance Premia shall be made in Dollars;

 

(e)Facility B – Payment of the COFACE Insurance Premia:

 

any Utilisation to be made in accordance with Clause 3.2(b) (Payment of the COFACE Insurance Premia), the Loan requested in a Utilisation Request must be, subject to Clause 12.3(d) (Borrower’s Payment Obligations), US$1,442,880. Any payment to COFACE of the COFACE Insurance Premia shall be made in Dollars;

 

(f)Facility A – Minimum Amount

 

Facility A, the amount of the proposed Loan must be an amount which is not more than the Available Facility and which is a minimum of US$1,000,000 or, if less, the Available Facility; and

 

(g)Facility B – Minimum Amount

 

Facility B, the amount of the proposed Loan must be an amount which is not more than the Available Facility and which is a minimum of US$1,000,000 or, if less, the Available Facility.

 

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5.6Lenders’ Participation

 

(a)If the conditions set out in this Agreement and the Global Deed of Amendment and Restatement have been met, each Lender shall make its participation in each Loan available by the Utilisation Date through its Facility Office.

 

(b)The amount of each Lender’s participation in each Loan will be equal to the proportion borne by its Available Commitment to the Available Facility immediately prior to making the Loan.

 

(c)Subject to the terms of the Global Deed of Amendment and Restatement, the COFACE Agent shall notify each Lender of the amount of each Loan and the amount of its participation in that Loan by 11:00 a.m. (Paris time) on a Business Day which is seven (7) Business Days prior to the proposed Utilisation Date for such Utilisation.

 

5.7Cancellation of Commitment

 

Subject to the terms of the Global Deed of Amendment and Restatement, the Total Commitments which, at that time, are unutilised shall be immediately cancelled at the end of the Availability Period.

 

6.Repayment

 

6.1Repayment

 

(a)Subject to paragraph (b) below, the Borrower shall repay the Loans made to it in full by making the repayments as set out in the Repayment Schedule on the dates (each a “Repayment Date”) and in the amounts set out opposite each Repayment Date in the Repayment Schedule (each a “Principal Repayment Amount”).

 

(b)If the Principal Repayment Amount scheduled to be repaid by the Borrower on a Repayment Date is greater than the principal amount of the Loans outstanding on that Repayment Date (the “Outstanding Amount”) then the relevant Principal Repayment Amount will be reduced to the Outstanding Amount and the Borrower shall repay the relevant Outstanding Amount on the relevant Repayment Date.

 

6.2Reborrowing

 

The Borrower may not reborrow any part of a Facility which is repaid.

 

7.Prepayment and Cancellation

 

7.1Illegality

 

If in any applicable jurisdiction it becomes unlawful for any Lender to perform any of its obligations as contemplated by this Agreement or to fund or maintain its participation in any Loan or it becomes unlawful for any Affiliate of a Lender for that Lender to do so:

 

(a)that Lender shall promptly notify the COFACE Agent upon becoming aware of that event;

 

(b)upon the COFACE Agent notifying the Borrower, the Commitment of that Lender will be immediately cancelled; and

 

(c)the Borrower shall repay that Lender’s participation in the Loans made to the Borrower on the last day of the Interest Period for each Loan occurring after the COFACE Agent has notified the Borrower or, if earlier, the date specified by the Lender in the notice delivered to the COFACE Agent (being no earlier than the last day of any applicable grace period permitted by law).

 

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7.2Mandatory Prepayment - Exit

 

(a)For the purposes of this Clause 7.2:

 

Acting in Concert” means acting together pursuant to an agreement or understanding (formal or informal).

 

Borrower Change of Control” means:

 

(i)the Thermo Group shall at any time and for any reason fail to own and control (without being subject to a voting trust, voting agreement, shareholders agreement or any other agreement limiting or affecting the voting of such stock other than any agreement entered into among the members of Thermo Group and their Affiliates which agreement is not otherwise inconsistent with this Agreement), free and clear of any Lien, at least fifty one per cent. (51%) of both the economic and voting interests in the Borrower’s Capital Stock (assuming that all convertible instruments, warrants or options then outstanding have been exercised); or

 

(ii)any “person” (other than the Thermo Group) together with its Affiliates owns or acquires (together with all stock that such person or Affiliate has the right to acquire whether such right is exercisable immediately or only after the passage of time), directly or indirectly, twenty five per cent. (25%) or more of the economic or voting interests in the Borrower’s Capital Stock (assuming that all convertible instruments, warrants or options then outstanding have been exercised); or

 

(iii)any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the US Securities Exchange Act of 1934 (the “Exchange Act”)), Acting in Concert or otherwise (other than Thermo Group), is or shall become the “beneficial owner” (as defined in Rules 13(d)-3 and 13(d)-5 under the Exchange Act, except that a person shall be deemed to have beneficial ownership of all stock that such person has the right to acquire whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of thirty three per cent. (33%) or more of the economic or voting interests in the Borrower’s Capital Stock (assuming that all convertible instruments, warrants or options then outstanding have been exercised); or

 

(iv)the board of directors of the Borrower shall cease to consist of a majority of Continuing Directors.

 

Change of Control” means either a Borrower Change of Control or a Thermo Change of Control.

 

Continuing Directors” means the directors of the Borrower and/or Thermo Group (as the case may be) on the date of this Agreement and each other director if such director’s nomination for election to the board of directors of the Borrower and/or Thermo Group (as the case may be) is recommended by a majority of the then Continuing Directors.

 

Thermo Change of Control” means:

 

(i)James Monroe III (or, in the event of his death or Incapacity, his executors, trustees, heirs or legal representatives) shall at any time and for any reason fail to own and control (without being subject to a voting trust, voting agreement, shareholders agreement or any other agreement limiting or affecting the voting of such stock), free and clear of any Lien, at least fifty one per cent. (51%) of both the economic and voting interests in any member of the Thermo Group’s Capital Stock (assuming that all convertible instruments, warrants or options then outstanding have been exercised); or

 

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(ii)any “person” or “group” (as such terms are used in the Exchange Act, Acting in Concert or otherwise, other than James Monroe III (or, in the event of his death or Incapacity, his executors, trustees, heirs or legal representatives), is or shall become the “beneficial owner” (as defined in Rules 13(d)-3 and 13(d)-5 under the Exchange Act, except that a person shall be deemed to have beneficial ownership of all stock that such person has the right to acquire whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of twenty five per cent. (25%) or more of the economic or voting interests in any member of the Thermo Group’s Capital Stock (assuming that all convertible instruments, warrants or options then outstanding have been exercised); or

 

(iii)the board of directors (or its equivalent) of any member of the Thermo Group shall cease to consist of a majority of Continuing Directors; or

 

(iv)James Monroe III (or, in the event of his death or Incapacity, his executors, trustees, heirs or legal representatives) shall cease to have the power to elect or remove a majority of the board of directors (or its equivalent) of any member of the Thermo Group; or

 

(v)any “change of control” or similar event shall occur under any document with respect to any equity or debt instrument issued or incurred by the Thermo Group.

 

(b)The Borrower must promptly notify the COFACE Agent if it becomes aware that the circumstances referred to in paragraph (c) below have occurred or are likely to occur.

 

(c)Upon the occurrence of a Change of Control, the Total Commitments shall be cancelled and all outstanding Loans, together with accrued interest and all other amounts accrued under the Finance Documents (including the COFACE Additional Insurance Premium and the Restructuring Fee), shall become immediately due and payable.

 

7.3Mandatory Prepayment – Cash Sweep of Spectrum Cash Flow

 

(a)The Borrower shall prepay the Restructuring Fee, the COFACE Additional Premium and/or the Loans (in the order set out in Clause 7.13 (Application of Mandatory Prepayments)) in an amount equal to seventy five per cent. (75%) of any Spectrum Cash Flow received by the Group at any time (the “SCF Amount”), provided that if the Excess Cash Flow for the Payment Period during which the Spectrum Cash Flow is realised is negative, the amount to be prepaid by the Borrower shall be the greater of:

 

(i)an amount equal to the Available Cash; and

 

(ii)the SCF Amount minus the Applicable Negative Excess Cash Flow,

 

unless the Available Cash referred to in paragraph (a)(i) above is greater than the SCF Amount, in which case, the amount to be prepaid by the Borrower shall be the SCF Amount.

 

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(b)The prepayment referred to in paragraph (a) above shall be made within:

 

(i)forty-five (45) days following the end of a First Half Payment Period, if the Spectrum Cash Flow is realised by a member of the Group during such First Half Payment Period; or

 

(ii)seventy-five (75) days following the end of a Second Half Payment Period if the Spectrum Cash Flow is realised by a member of the Group during such Second Half Payment Period.

 

(c)Any mandatory prepayment arising as a result of any Spectrum Sale shall be made in accordance with Clause 7.8 (Mandatory Prepayment – Cash Sweep following Spectrum Sale).

 

7.4Mandatory Prepayment –Excess Cash Flow

 

From (and including) 31 December 2013 and no later than:

 

(a)forty-five (45) days after the end of any First Half Payment Period; and

 

(b)seventy-five (75) days after the end of any Second Half Payment Period,

 

the Borrower shall, in each case, apply fifty per cent. (50%) of all Excess Cash Flow calculated as of the last day of such Payment Period in mandatory prepayment of the Restructuring Fee, the COFACE Additional Premium and/or the Loans (as the case may be).

 

7.5Mandatory Prepayment - Insurance and Condemnation Events

 

(a)Subject to Clause 7.5(b) below, the Borrower shall prepay the Restructuring Fee, the COFACE Additional Premium and/or the Loans (in the order set out in Clause 7.13 (Application of Mandatory Prepayments)) in an amount equal to one hundred per cent. (100%) of the aggregate Net Cash Proceeds from any Insurance and Condemnation Event and other extraordinary recoveries by the Borrower or any of its Subsidiaries.

 

(b)Such prepayments shall be made within three (3) Business Days after receipt of the Net Cash Proceeds from any Insurance and Condemnation Event by the Borrower or any of its Subsidiaries, provided that so long as no Event of Default has occurred and is continuing (and so long as no action is being taken under Clause 24 (Remedies Upon an Event of Default)), no prepayment shall be required:

 

(i)in connection with such Insurance and Condemnation Event yielding in aggregate less than US$500,000 in Net Cash Proceeds; or

 

(ii)with respect to any such Net Cash Proceeds which are committed by the Borrower to be reinvested in replacement assets of French suppliers or the procurement or Launch of a Satellite or Satellites acquired or planned to be acquired pursuant to the then current Agreed Business Plan of the Borrower (as evidenced by a contractual agreement for the purchase or acquisition of assets) within six (6) Months after receipt of such Net Cash Proceeds and the proceeds arising out of the relevant Insurance are placed into the Insurance Proceeds Account (such account to be secured in favour of the Security Agent (for and on behalf of itself and the other Finance Parties)) and, provided that no action is being taken under Clause 24 (Remedies Upon an Event of Default), will be applied by the COFACE Agent in payment to a supplier of such replacement asset or replacement Satellite, any long lead items, launch services, insurances or other costs directly arising in relation to such purchase or Launch in accordance with the terms and conditions agreed between the Borrower and the Supplier. Any excess in Net Cash Proceeds after taking into account such payments and costs shall be transferred to the Collection Account in accordance with the Accounts Agreement.

 

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7.6Mandatory Prepayments – Asset Dispositions

 

(a)The Borrower shall prepay the Restructuring Fee, the COFACE Additional Premium and/or the Loans (in the order set out in Clause 7.13 (Application of Mandatory Prepayments)) in an amount equal to one hundred per cent. (100%) of the aggregate Net Cash Proceeds from any Asset Disposition by the Borrower or any of its Subsidiaries.

 

(b)Such prepayment shall be made within three (3) days after the date of receipt of the Net Cash Proceeds of any such transaction by the Borrower or any of its Subsidiaries, provided that, so long as no Default has occurred and is continuing, no prepayment shall be required pursuant to this Clause 7.6:

 

(i)in connection with such Asset Dispositions yielding less than US$50,000 per disposal in Net Cash Proceeds (provided that any such disposal shall be deemed to include the Net Cash Proceeds from any related disposal or series of disposals), and in any event subject to an annual aggregate of US$200,000 and a total aggregate of US$1,000,000; or

 

(ii)with respect to any such Net Cash Proceeds which are:

 

(A)reinvested within six (6) Months after receipt of such Net Cash Proceeds by such person in replacement assets (useful to the Borrower and its Subsidiaries in the conduct of business in accordance with Clause 22.12 (Nature of Business)); or

 

(B)committed (as evidenced by a contractual agreement for the purchase or acquisition of assets with a vendor of such assets) within six (6) Months after receipt of such Net Cash Proceeds by such person to be reinvested in the procurement or Launch of a Satellite or Satellites acquired or to be acquired pursuant to the then current Agreed Business Plan of the Borrower,

 

provided further that the Borrower shall procure that all such Net Cash Proceeds referred to in this paragraph (b)(ii) shall, immediately upon receipt thereof by the Borrower, be paid into the Holding Account.

 

(c)The Borrower irrevocably authorises the COFACE Agent to instruct the Offshore Account Bank to apply amounts credited to the Holding Account (to the extent not applied in accordance with sub-paragraphs (A) and (B) above) in prepayment of the Restructuring Fee, the COFACE Additional Premium and/or the Loans.

 

(d)Prior to any application of the Net Cash Proceeds in accordance with paragraphs (b)(ii)(A) and (B) above, the Borrower shall deliver to the COFACE Agent a certificate satisfactory in all respects to the COFACE Agent and signed by a Responsible Officer providing details of the intended use of such Net Cash Proceeds.

 

(e)Any application of the Net Cash Proceeds in accordance with paragraphs (b)(ii)(A) and (B) above shall be made in a manner consistent with the then current Agreed Business Plan.

 

(f)Solely for the purposes of this Clause 7.6, the term Asset Disposition shall exclude any Spectrum Sale and any disposal of inventory in the ordinary cause of trading (but shall include any disposal of obsolete, damaged, worn-out or surplus assets).

 

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7.7Mandatory Prepayment – COFACE Insurance Policy

 

If the credit insurance cover under the COFACE Insurance Policy is not in full force and effect for a reason not attributable to the Borrower, the COFACE Agent shall, by not less than thirty (30) days’ notice to the Borrower, cancel the Total Commitments and declare all outstanding Loans, together with accrued interest, and all other amounts accrued under the Finance Documents (including the Restructuring Fee and the COFACE Additional Insurance Premium) immediately due and payable, whereupon the Total Commitments will be cancelled and all such outstanding amounts will become immediately due and payable.

 

7.8Mandatory Prepayment – Cash Sweep following Spectrum Sale

 

(a)The Borrower shall prepay the Restructuring Fee, the COFACE Additional Premium and/or the Loans (in the order set out in Clause 7.13 (Application of Mandatory Prepayments)) in an amount equal to one hundred per cent. (100%) of the aggregate Net Cash Proceeds from any Spectrum Sale.

 

(b)Such prepayment shall be made within three (3) Business Days after receipt of the Net Cash Proceeds from any Spectrum Sale by the Borrower or such other member of the Group.

 

(c)Any Liens held by the COFACE Agent in respect of any Spectrum which is the subject of a Spectrum Sale shall only be released upon the COFACE Agent being satisfied that:

 

(i)all Net Cash Proceeds in respect of such Spectrum Sale have been applied in accordance with Clause 7.13 (Application of Mandatory Prepayments);

 

(ii)no amount being prepaid is, or shall be, the subject of any clawback or restitution claim; and

 

(iii)no Default is continuing (unless otherwise agreed by the COFACE Agent).

 

7.9Mandatory Prepayment – Cash Sweep following Equity Issuance and Debt Issuance

 

(a)Any Net Cash Proceeds raised by the Borrower pursuant to any Equity Issuance or any Debt Issuance occurring on or after the Effective Date (but excluding any Net Cash Proceeds raised pursuant to any Equity Commitments and the Excluded Purchase Agreement Amount) which exceed, in aggregate, an amount of US$145,000,000 shall be prepaid by the Borrower in accordance with the provisions of Clause 7.13 (Application of Mandatory Prepayments) in the following amounts in respect of any Net Cash Proceeds raised pursuant to any relevant:

 

(i)Equity Issuance (including any Equity Linked Securities), in an amount equal to fifty per cent. (50%) of such Net Cash Proceeds; and

 

(ii)Debt Issuance, in an amount equal to seventy five per cent. (75%) of such Net Cash Proceeds.

 

(b)Any prepayment made in relation to this Clause 7.9 shall be made:

 

(i)in respect of any relevant Equity Issuance, within three (3) Business Days of the completion of such Equity Issuance; or

 

(ii)in respect of any relevant Debt Issuance, simultaneously with the funding of such Debt Issuance.

 

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7.10Voluntary Cancellation

 

The Borrower may, if it:

 

(a)gives the COFACE Agent not less than twenty (20) Business Days’ (or such shorter period as the Majority Lenders may agree) prior notice; and

 

(b)delivers to the COFACE Agent a certificate signed by a Responsible Officer demonstrating that the Borrower has sufficient funds to finance the Project to the satisfaction of the COFACE Agent after any such cancellation,

 

cancel the whole or any part (being a minimum amount of US$1,000,000) of the Available Facility. Any cancellation under this Clause 7.10 shall reduce the Commitments of the Lenders in inverse order of maturity.

 

7.11Voluntary Prepayment of the Loans

 

(a)The Borrower may, if it gives the COFACE Agent not less than twenty (20) Business Days’ (or such shorter period as the Majority Lenders may agree) prior notice, prepay the whole or any part of the Loans (but, if in part, being an amount that reduces the amount of the Loans by a minimum amount of US$1,000,000). The Borrower may make a prepayment in accordance with this Clause 7.11 on a Repayment Date.

 

(b)If such a prepayment is made on a day other than the last day of an Interest Period, the Borrower shall make that prepayment together with any Break Costs in accordance with Clause 10.4 (Break Costs), without premium or penalty.

 

(c)The Loans may only be prepaid after the last day of the Availability Period (or, if earlier, the day on which the Available Facility is zero (0)).

 

(d)Any prepayment under this Clause 7.11 shall be applied:

 

(i)first, pro rata against the obligation of the Borrower to pay:

 

(A)the Restructuring Fee (pursuant to the terms of the Global Deed of Amendment and Restatement); and

 

(B)the COFACE Additional Insurance Premium; and

 

(ii)second:

 

(A)pro rata among the Facilities and within each Facility; and

 

(B)in inverse order of maturity across the remaining scheduled repayments under each Facility.

 

7.12Right of Repayment and Cancellation in relation to a Single Lender

 

(a)If:

 

(i)any sum payable to any Lender by the Borrower is required to be increased under paragraph (c) of Clause 13.1 (Tax Gross-up); or

 

(ii)any Lender claims indemnification from the Borrower under Clause 13.2 (Tax Indemnity) or Clause 14.1 (Increased Costs),

 

the Borrower may, whilst the circumstance giving rise to the requirement for indemnification continues, give the COFACE Agent notice of cancellation of the Commitment of that Lender and its intention to procure the repayment of that Lender’s participation in the Loans.

 

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(b)On receipt of a notice of cancellation referred to in paragraph (a) above, the Commitment of that Lender shall immediately be reduced to zero (0).

 

(c)On the last day of each Interest Period which ends after the Borrower has given notice of cancellation under paragraph (a) above (or, if earlier, the date specified by the Borrower in that notice), the Borrower shall repay that Lender’s participation in that Loan.

 

7.13Application of Mandatory Prepayments

 

Other than in respect of any prepayment under Clause 7.1 (Illegality), all other mandatory prepayments under this Clause 7 (Prepayment and Cancellation) shall be applied:

 

(a)first, pro rata against the obligation of the Borrower to pay:

 

(i)the Restructuring Fee (pursuant to the terms of the Global Deed of Amendment and Restatement); and

 

(ii)the COFACE Additional Insurance Premium; and

 

(b)second:

 

(i)pro rata among the Facilities and within each Facility; and

 

(ii)in inverse order of maturity across the remaining scheduled repayments under each Facility.

 

7.14Restrictions

 

(a)Any notice of cancellation or prepayment given by the Borrower under this Clause 7 shall be irrevocable and, unless a contrary indication appears in this Agreement, shall specify the date or dates upon which the relevant cancellation or prepayment is to be made and the amount of that cancellation or prepayment.

 

(b)Any prepayment under this Agreement shall be made together with accrued interest on the amount prepaid and, subject to any Break Costs, without premium or penalty.

 

(c)The Borrower may not reborrow any part of a Facility which is prepaid.

 

(d)The Borrower shall not repay or prepay all or any part of the Loans or cancel all or any part of the Commitments except at the times and in the manner expressly provided for in this Agreement.

 

(e)No amount of the Total Commitments cancelled under this Agreement may be subsequently reinstated.

 

(f)If the COFACE Agent receives a notice under this Clause 7 it shall promptly forward a copy of that notice to either the Borrower or the affected Lender, as appropriate.

 

(g)The Borrower shall promptly notify the COFACE Agent (but in any event no later than three (3) Business Days) of any payment pursuant to this Clause 7, and the COFACE Agent shall promptly notify the Lenders (but in any event no later than five (5) Business Days) of the same.

 

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8.Interest

 

8.1Calculation of Interest

 

The rate of interest on each Loan for each Interest Period is the percentage rate per annum which is the aggregate of the:

 

(a)Applicable Margin; and

 

(b)LIBOR.

 

8.2Payment of Interest

 

The Borrower shall pay accrued interest on each Loan on the last day of each Interest Period.

 

8.3Default Interest

 

(a)If an Obligor fails to pay any amount payable by it under a Finance Document on its due date, interest shall accrue on the overdue amount from the due date up to the date of actual payment (both before and after judgment) at a rate which, subject to paragraph (b) below, is two per cent. (2%) higher than the rate which would have been payable if the overdue amount had, during the period of non-payment, constituted a Loan in the currency of the overdue amount for successive Interest Periods, each of a duration selected by the COFACE Agent (acting reasonably). Any interest accruing under this Clause 8.3 shall be immediately payable by the Borrower on demand by the COFACE Agent.

 

(b)If any overdue amount consists of all or part of a Loan which became due on a day which was not the last day of an Interest Period relating to that Loan:

 

(i)the first Interest Period for that overdue amount shall have a duration equal to the unexpired portion of the current Interest Period relating to that Loan; and

 

(ii)the rate of interest applying to the overdue amount during that first Interest Period shall be two per cent. (2%) higher than the rate which would have applied if the overdue amount had not become due.

 

(c)Default interest (if unpaid) arising on an overdue amount will be compounded with the overdue amount at the end of each Interest Period applicable to that overdue amount but will remain immediately due and payable.

 

8.4Notification of Rates of Interest

 

The COFACE Agent shall within two (2) Business Days after a Quotation Day notify the Lenders and the Borrower of the determination of a rate of interest under this Agreement.

 

9.Interest Periods

 

9.1Interest Periods

 

(a)The Interest Period for which any Loan is outstanding shall be divided into successive Interest Periods each of which shall start on the last day of the preceding such Interest Period.

 

(b)The initial Interest Period for each Loan:

 

(i)shall start on (and include) the Utilisation Date of such Loan and end on (but excluding) the last day of such Interest Period. Each subsequent Interest Period in respect of such Loan shall start on (and include) the last day of the previous Interest Period and end on (but exclude) the last day of the relevant Interest Period provided that, the Interest Period occurring prior to the First Repayment Date shall start (and include) on the last day of the previous Interest Period and end on (but excluding) the First Repayment Date; and

 

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(ii)after the first Utilisation shall start on (and include) the Utilisation Date of the relevant Loan and end on (but excluding) the last day of the current Interest Period for the first Utilisation.

 

9.2Duration

 

(a)The duration of each Interest Period shall, save as otherwise provided in this Agreement, be six (6) Months or such other period as the COFACE Agent may agree, provided that any Interest Period that would otherwise extend beyond a Repayment Date relating to any Loan shall be of such duration that it shall end on that Repayment Date.

 

(b)Notwithstanding anything to the contrary in this Agreement, if the Interest Period falling immediately prior to the First Repayment Date would be shorter than ten (10) days (a “Relevant Interest Period”), then the Interest Period falling immediately prior to the Relevant Interest Period shall be extended so that it shall end on the First Repayment Date.

 

(c)Each Interest Period commencing after the First Repayment Date shall end on the following Repayment Date.

 

(d)An Interest Period for a Loan shall not extend beyond the Final Maturity Date.

 

9.3Non-Business Days

 

If an Interest Period would otherwise end on a day which is not a Business Day, that Interest Period will instead end on the next Business Day in that calendar month (if there is one) or the preceding Business Day (if there is not).

 

9.4Consolidation of Loans

 

If two (2) or more Interest Periods:

 

(a)relate to Loans; and

 

(b)end on the same date,

 

those Loans will be consolidated into, and treated as, a single Loan on the last day of the Interest Period.

 

10.Changes to the Calculation of Interest

 

10.1Absence of Quotations

 

Subject to Clause 10.2 (Market Disruption), if LIBOR is to be determined by reference to the Reference Banks but a Reference Bank does not supply a quotation by 11:00 a.m. (London time) on the Quotation Day, the applicable LIBOR shall be determined on the basis of the quotations of the remaining Reference Banks.

 

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10.2Market Disruption

 

(a)If a Market Disruption Event occurs in relation to a Loan for any Interest Period, then the rate of interest on each Lender’s share of that Loan for the Interest Period shall be the percentage rate per annum which is the sum of:

 

(i)the Applicable Margin; and

 

(ii)the rate notified to the COFACE Agent by that Lender as soon as practicable and in any event before interest is due to be paid in respect of that Interest Period, to be that which expresses as a percentage rate per annum the cost to that Lender of funding its participation in that Loan from whatever source it may reasonably select.

 

(b)In this Agreement “Market Disruption Event” means:

 

(i)at or about noon on the Quotation Day for the relevant Interest Period the Screen Rate is not available and none or only one (1) of the Reference Banks supplies a rate to the COFACE Agent to determine LIBOR for Dollars for the relevant Interest Period; or

 

(ii)before close of business in London on the Quotation Day for the relevant Interest Period, the COFACE Agent receives notifications from a Lender or Lenders (whose participations in a Loan exceed thirty per cent. (30%) of that Loan) that the cost to it or them of obtaining matching deposits in the London interbank market would be in excess of LIBOR.

 

10.3Alternative Basis of Interest or Funding

 

(a)If a Market Disruption Event occurs and the COFACE Agent or the Borrower so requires, the COFACE Agent and the Borrower shall enter into negotiations (for a period of not more than thirty (30) days) with a view to agreeing a substitute basis for determining the rate of interest.

 

(b)Any alternative basis agreed pursuant to paragraph (a) above shall, with the prior consent of all the Lenders and the Borrower, be binding on all Parties.

 

10.4Break Costs

 

(a)The Borrower shall, within three (3) Business Days of demand by a Finance Party, pay to that Finance Party its Break Costs attributable to all or any part of a Loan or Unpaid Sum being paid by the Borrower on a day other than the last day of an Interest Period for that Loan or Unpaid Sum.

 

(b)Each Lender shall, as soon as reasonably practicable after a demand by the COFACE Agent, provide a certificate confirming the amount of its Break Costs for any Interest Period in which they accrue.

 

11.Fees

 

11.1Commitment Fee

 

(a)The Borrower shall pay to the COFACE Agent (for the account of each Lender) a fee computed at the rate of one point fifteen per cent. (1.15%) per annum on that Lender’s daily undrawn Available Commitment under:

 

(i)Facility A for the Availability Period applicable to Facility A; and

 

(ii)Facility B for the Availability Period applicable to Facility B.

 

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(b)The accrued commitment fee is payable:

 

(i)on the last day of each successive period of six (6) Months which ends during the Availability Period;

 

(ii)on the last day of the Availability Period; and

 

(iii)if cancelled in full, on the cancelled amount of the relevant Lender’s Commitment at the time the cancellation is effective.

 

11.2Up-front Fee

 

(a)The Borrower shall pay to the COFACE Agent (for the account of each Mandated Lead Arranger) an arrangement fee in an amount equal to two point eight per cent. (2.8%) of the aggregate principal amount of the Total Commitments as at the date of this Agreement (the “Up-front Fee”).

 

(b)The Up-front Fee shall be due on the date of this Agreement and payable on the earlier of:

 

(i)sixty (60) days from the date of this Agreement; and

 

(ii)Financial Close.

 

11.3COFACE Agent Fees

 

(a)Subject to paragraph (b) below, the Borrower shall pay to the COFACE Agent (for its own account) an annual agency fee of US$50,000 (the “COFACE Agent Fee”), which must be paid annually in advance in accordance with paragraphs (b) and (c) below.

 

(b)Notwithstanding paragraph (a) above, the COFACE Agent Fee for 2013 payable on the Effective Date shall be an amount equal to US$35,000.

 

(c)Each subsequent payment is payable on each anniversary of the date of this Agreement for as long as any Commitment is in force or amount is outstanding under the Finance Documents.

 

11.4Security Agent Fees

 

(a)The Borrower shall pay to the Security Agent (for its own account) an annual agency fee of US$50,000 (the “Security Agent Fee”), which must be paid annually in advance in accordance with paragraphs (b) and (c) below.

 

(b)Notwithstanding paragraph (a) above, the Security Agent Fee for 2013 payable on the Effective Date shall be an amount equal to US$20,000.

 

(c)Each subsequent payment is payable on each anniversary of the date of this Agreement for as long as any Commitment is in force or amount is outstanding under the Finance Documents.

 

11.5Restructuring Fee

 

(a)Pursuant to clause 4.1 (Restructuring Fee) of the Global Deed of Amendment and Restatement, the Borrower is required to pay to the COFACE Agent (for the account of each Lender pro rata to the proportion of each Lender’s Commitment) a restructuring fee in an amount equal to two point five per cent. (2.5%) of the Total Commitments as at the Effective Date, being US$14,658,550 (the “Restructuring Fee”) which amount shall become due on the Effective Date and shall be payable in accordance with paragraph (b) below.

 

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(b)Pursuant to clause 4.2 (Restructuring Fee Payment) of the Global Deed of Amendment and Restatement, the Borrower has agreed to pay the Restructuring Fee on the following dates:

 

(i)an amount equal to forty per cent. (40%) of the Restructuring Fee (being US$5,863,420) on or prior to the Effective Date as a condition precedent to the occurrence thereof; and

 

(ii)an amount equal to sixty per cent. (60%) of the Restructuring Fee (being US$8,795,130) on 31 December 2017 (or such earlier date as all principal, interest and other amounts outstanding under this Agreement have been repaid in full).

 

(c)For the avoidance of doubt, the Restructuring Fee is payable in accordance with the Global Deed of Amendment and Restatement and this Clause 11.5 does not create a separate obligation to pay such fee pursuant to this Agreement.

 

11.6Non-Refundable

 

Each of the fees set out in this Clause 11 (Fees) once paid are non-refundable and non-creditable against other fees payable in connection with the Project.

 

12.COFACE Insurance Premia and COFACE Additional Insurance Premium

 

12.1Payment by the Borrower

 

(a)The Borrower shall bear the cost of the COFACE Insurance Premia and the COFACE Additional Insurance Premium payable in respect of, or in connection with, the COFACE Insurance Policy and shall pay all such amounts to the COFACE Agent (for the account of COFACE).

 

(b)The COFACE Insurance Premia is due and payable in full to the COFACE Agent (for the account of COFACE) on the Utilisation Date for the first Utilisation and such amounts have been paid by the Borrower.

 

(c)The COFACE Additional Insurance Premium is due to the COFACE Agent (for the account of COFACE) on the Effective Date and shall be paid by the Borrower as follows:

 

(i)US$8,000,000 shall be paid on the Effective Date; and

 

(ii)US$12,000,000 shall be paid on 31 December 2017,

 

(or, if earlier, in each case, the date on which the COFACE Additional Insurance Premium has been paid in full pursuant to any prepayments applied against such COFACE Additional Insurance Premium under the terms of this Agreement).

 

12.2Financing with Proceeds of Loans

 

(a)Subject to all the other terms and conditions of this Agreement, the COFACE Insurance Premia shall be financed from the first Utilisation under the Facilities.

 

(b)Loans made under a Facility on account of the COFACE Insurance Premia shall be included in the principal amount of a Facility and repaid to the COFACE Agent in accordance with the relevant provisions in this Agreement and the Borrower shall pay interest on such amount at the rates determined under, and in accordance with, Clause 8 (Interest) and repay such amount together with all other principal as stated in Clause 6.1 (Repayment).

 

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(c)For the avoidance of doubt, the COFACE Additional Insurance Premium shall not be financed by the proceeds of either Facility.

 

12.3Borrower’s Payment Obligations

 

(a)The Borrower acknowledges that the obligation to pay one hundred per cent. (100%) of the COFACE Insurance Premia and the COFACE Additional Insurance Premium as and when they arise is absolute and unconditional.

 

(b)If the COFACE Insurance Premia due and payable is not financed or paid out of any Loans under this Agreement or if the undrawn amount under a Facility is not sufficient to finance one hundred per cent. (100%) of the COFACE Insurance Premia due to COFACE under the COFACE Insurance Policy, the Borrower shall pay directly to the COFACE Agent the amount of any such COFACE Insurance Premia not so financed or paid.

 

(c)Subject to Clause 12.3(d) below, as of the date of this Agreement the premia due to COFACE in respect of the COFACE Insurance Premia shall be calculated at a rate estimated to be six point sixty eight per cent. (6.68%), and in an estimated amount being the aggregate of:

 

(i)US$35,272,276 in respect of Facility A; and

 

(ii)US$1,442,880 in respect of Facility B.

 

(d)The COFACE Agent will only be notified of the actual amount of the COFACE Insurance Premia on the date of final issuance of each COFACE Insurance Policy.

 

(e)Following receipt of each COFACE Insurance Policy, the COFACE Agent shall promptly notify the Borrower of the actual amount of the COFACE Insurance Premia. If the actual amount of the COFACE Insurance Premia is greater than the estimated amount set out in paragraph (c) above, the Borrower shall be obliged to make payment of the actual amount of the COFACE Insurance Premia. Accordingly, the estimated amount provided in Clauses 3.1(c) (Payment of the COFACE Insurance Premia) and 3.2(b) (Payment of the COFACE Insurance Premia) shall be automatically increased or reduced by the amounts required to ensure the payment of the premiums after adjustment by COFACE, which would result in an increase or reduction by a corresponding amount in the Total Commitments subject to available Commitments).

 

(f)[Intentionally omitted]

 

(g)Notwithstanding the above, a minimum premium being, as of the date of this Agreement, in an amount equal to the Dollar equivalent of €1,515 shall be paid to COFACE by the Borrower in respect of each COFACE Insurance Policy upon the execution of the relevant COFACE Insurance Policy. Such amounts shall remain the property of COFACE and are accordingly payable by the Borrower to COFACE in any event.

 

(h)Subject to paragraph (i) below, the Borrower shall not be entitled to claim any credit or reimbursement of the COFACE Insurance Premia or the COFACE Additional Insurance Premium, including in the event of a cancellation, an acceleration or a prepayment of any Loan under this Agreement.

 

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(i)Notwithstanding paragraph (h) above and subject to paragraph (j) below:

 

(i)with respect to any partial cancellation of any undisbursed amount of a Facility; and/or

 

(ii)immediately following the end of the Availability Period, where an Available Commitment remains outstanding,

 

the Borrower shall be entitled to submit a request to the COFACE Agent for reimbursement of any proportionate amount of the COFACE Insurance Premia, in an amount up to one hundred per cent. (100%) of the total amount of the COFACE Insurance Premia, which relates to such cancelled amount of any undisbursed portion of a Facility and/or outstanding Available Commitment referred to in paragraphs (i)(i) and (ii) above, as the case may be, in each case such amount to be subject to the approval of the COFACE Agent. For the avoidance of doubt, this paragraph (i) does not apply to the COFACE Additional Insurance Premium.

 

(j)No reimbursement of the COFACE Insurance Premia pursuant to paragraph (i) above shall be made by the COFACE Agent if:

 

(i)a Default shall have occurred and be continuing; and

 

(ii)the COFACE Agent has not received funds from COFACE in an amount equal to the COFACE Insurance Premia to be reimbursed.

 

(k)Notwithstanding anything to the contrary in this Agreement, the Parties acknowledge that the Borrower has paid the COFACE Insurance Premia on or around Financial Close. This paragraph (k) does not apply to the COFACE Additional Insurance Premium.

 

13.Tax gross-up and Indemnities

 

13.1Tax Gross-up

 

(a)The Borrower shall make all payments to be made by it without any Tax Deduction, unless a Tax Deduction is required by law.

 

(b)The Borrower shall, promptly upon becoming aware that it must make a Tax Deduction (or that there is any change in the rate or the basis of a Tax Deduction) notify the COFACE Agent accordingly. Similarly, a Lender shall notify the COFACE Agent on becoming so aware in respect of a payment payable to that Lender. If the COFACE Agent receives such notification from a Lender it shall notify the Borrower.

 

(c)If a Tax Deduction is required by law to be made by the Borrower, the amount of the payment due from the Borrower shall be increased to an amount which (after making any Tax Deduction) leaves an amount equal to the payment which would have been due if no Tax Deduction had been required.

 

(d)If the Borrower is required to make a Tax Deduction, it shall make that Tax Deduction and any payment required in connection with that Tax Deduction within the time allowed and in the minimum amount required by law.

 

(e)Within thirty (30) days of making either a Tax Deduction or any payment required in connection with that Tax Deduction, the Borrower making that Tax Deduction shall deliver to the COFACE Agent for the Finance Party entitled to the payment evidence reasonably satisfactory to that Finance Party that the Tax Deduction has been made or (as applicable) any appropriate payment paid to the relevant taxing authority.

 

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(f)A payment shall not be increased under paragraph (c) above by reason of a Tax Deduction on account of Tax, if on the date on which the payment falls due:

 

(i)the payment could have been made to the relevant Lender without a Tax Deduction if the Lender had been a Qualifying Lender, but on that date that Lender is not, or has ceased to be, a Qualifying Lender other than as a result of any change after the date it became a Lender under this Agreement:

 

(A)in (or in the interpretation, administration, or application of) any law or double taxation agreement, or any published practice or published concession of any relevant authority; or

 

(B)in the circumstance of the Borrower; or

 

(ii)the Borrower is able to demonstrate that the payment could have been made to the Lender without the Tax Deduction had that Lender complied with its obligations under paragraph (g) below.

 

(g)Each Lender agrees to use reasonable efforts (consistent with legal and regulatory restrictions and subject to overall policy considerations of such Lender) to file any Withholding Forms as requested by the Borrower that may be necessary to establish an exemption from withholding of US federal income taxes.

 

13.2Tax Indemnity

 

(a)The Borrower shall (within three (3) Business Days of demand by the COFACE Agent) pay to a Protected Party an amount equal to the loss, liability or cost which that Protected Party determines will be or has been (directly or indirectly) suffered for or on account of Tax by that Protected Party in respect of a Finance Document.

 

(b)Paragraph (a) above shall not apply with respect to any Tax assessed on a Finance Party:

 

(i)under the law of the jurisdiction in which that Finance Party is incorporated or, if different, the jurisdiction (or jurisdictions) in which that Finance Party is treated as resident for tax purposes; or

 

(ii)under the law of the jurisdiction in which that Finance Party’s Facility Office is located in respect of amounts received or receivable in that jurisdiction,

 

if that Tax is imposed on or calculated by reference to the net income received or receivable (but not any sum deemed to be received or receivable) by that Finance Party or to the extent a loss, liability or cost:

 

(A)is compensated for by an increased payment under Clause 13.1 (Tax Gross-up);

 

(B)would have been compensated for by an increased payment under Clause 13.1 (Tax Gross-up) but was not so compensated solely because one of the exclusions in paragraph (f) of Clause 13.1 (Tax Gross-up) applied; or

 

(C)relates to a FATCA Deduction required to be made by a Party.

 

(c)A Protected Party making, or intending to make a claim under paragraph (a) above shall promptly notify the COFACE Agent of the event which will give, or has given, rise to the claim, following which the COFACE Agent shall notify the Borrower.

 

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(d)A Protected Party shall, on receiving a payment from the Borrower under this Clause 13.2, notify the COFACE Agent.

 

13.3Tax Credit

 

If the Borrower makes a Tax Payment and the relevant Finance Party determines that:

 

(a)a Tax Credit is attributable to an increased payment of which that Tax Payment forms part, to that Tax Payment or to a Tax Deduction in consequence of which that Tax Payment was required; and

 

(b)that Finance Party has obtained and utilised that Tax Credit,

 

the Finance Party shall pay an amount to the Borrower which that Finance Party determines will leave it (after that payment) in the same after-Tax position as it would have been in had the Tax Payment not been required to be made by the Borrower provided that,

 

(i)any Finance Party may determine, in its sole discretion consistent with the policies of such Finance Party, whether to seek a Tax Credit;

 

(ii)if such Tax Credit is subsequently disallowed or reduced, the Borrower shall indemnify the Finance Party for such amount; and

 

(iii)nothing in this Clause 13.3 shall require a Finance Party to disclose any confidential information to the Borrower (including, without limitation, its tax returns or its calculations).

 

13.4Stamp Taxes

 

The Borrower shall pay and, within three (3) Business Days of demand, indemnify each Finance Party against any cost, loss or liability that Finance Party incurs in relation to all stamp duty, registration and other similar Taxes payable in respect of any Finance Document.

 

13.5Value Added Tax

 

(a)All amounts expressed to be payable under a Finance Document by any Party to a Finance Party which (in whole or in part) constitute the consideration for any supply for VAT purposes are deemed to be exclusive of any VAT which is chargeable on that supply, and accordingly, subject to paragraph (b) below, if VAT is or becomes chargeable on any supply made by any Finance Party to any Party under a Finance Document and such Finance Party is required to account to the relevant tax authority for the VAT, that Party must pay to such Finance Party (in addition to and at the same time as paying the consideration for such supply) an amount equal to the amount of the VAT (and such Finance Party must promptly provide an appropriate VAT invoice to that Party).

 

(b)Where a Finance Document requires any Party to reimburse or indemnify a Finance Party for any cost or expense, that Party shall reimburse or indemnify (as the case may be) such Finance Party for the full amount of such cost or expense, including such part thereof as represents VAT, save to the extent that such Finance Party reasonably determines that it is entitled to credit or repayment in respect of such VAT from the relevant tax authority.

 

(c)In relation to any supply made by a Finance Party to any Party under a Finance Document, if reasonably requested by such Finance Party, that Party must promptly provide such Finance Party with details of that Party’s VAT registration and such other information as is reasonably requested in connection with such Finance Party’s VAT reporting requirements in relation to such supply.

 

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13.6Lender Status Confirmation

 

Each Lender which becomes a Party to this Agreement after the date of this Agreement shall indicate, in the Transfer Certificate or Assignment Agreement which it executes on becoming a Party, and for the benefit of the COFACE Agent and without liability to any Obligor, which of the following categories it falls in:

 

(a)not a Qualifying Lender; or

 

(b)a Qualifying Lender.

 

If a New Lender fails to indicate its status in accordance with this Clause 13.6 then such New Lender shall be treated for the purposes of this Agreement (including by each Obligor) as if it is not a Qualifying Lender until such time as it notifies the COFACE Agent which category applies (and the COFACE Agent, upon receipt of such notification, shall inform the Borrower). For the avoidance of doubt, a Transfer Certificate or Assignment Agreement shall not be invalidated by any failure of a Lender to comply with this Clause 13.6.

 

13.7FATCA Information

 

(a)Subject to paragraph (c) below, each Party shall, within ten (10) Business Days of a reasonable request by another Party:

 

(i)confirm to that other Party whether it is:

 

(A)a FATCA Exempt Party; or

 

(B)not a FATCA Exempt Party; and

 

(ii)supply to that other Party such forms, documentation and other information relating to its status under FATCA (including other information required under the US Treasury Regulations or other official guidance including intergovernmental agreements) as that other Party reasonably requests for the purposes of that other Party’s compliance with FATCA.

 

(b)If a Party confirms to another Party pursuant to Clause 13.7(a)(i) above that it is a FATCA Exempt Party and it subsequently becomes aware that it is not, or has ceased to be a FATCA Exempt Party, that Party shall notify that other Party reasonably promptly.

 

(c)Paragraph (a) above shall not oblige any Finance Party to do anything which would or might in its reasonable opinion constitute a breach of:

 

(i)any law or regulation;

 

(ii)any fiduciary duty; or

 

(iii)any duty of confidentiality.

 

(d)If a Party fails to confirm its status or to supply forms, documentation or other information requested in accordance with paragraph (a) above (including, for the avoidance of doubt, where paragraph (c) above applies), then if that Party failed to confirm whether it is (and/or remains) a FATCA Exempt Party such Party shall be treated for the purposes of the Finance Documents as if it is not a FATCA Exempt Party until such time as the Party in question provides the requested confirmation, forms, documentation or other information.

 

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(e)If the Borrower is a US Tax Obligor, or where the COFACE Agent reasonably believes that its obligations under FATCA require it, each Lender shall, within ten Business Days of:

 

(i)where the Borrower is a US Tax Obligor and the relevant Lender is an Original Lender, the date of this Agreement;

 

(ii)where the Borrower is a US Tax Obligor and the relevant Lender is a New Lender, the relevant Transfer Date; or

 

(iii)where the Borrower is not a US Tax Obligor, the date of a request from the COFACE Agent,

 

supply to the COFACE Agent:

 

(A)a withholding certificate on Form W-8 or Form W-9 (or any successor form) (as applicable); or

 

(B)any withholding statement and other documentation, authorisations and waivers as the COFACE Agent may require to certify or establish the status of such Lender under FATCA.

 

The COFACE Agent shall provide any withholding certificate, withholding statement, documentation, authorisations and waivers it receives from a Lender pursuant to this paragraph (e) to the Borrower and shall be entitled to rely on any such withholding certificate, withholding statement, documentation, authorisations and waivers provided without further verification. The COFACE Agent shall not be liable for any action taken by it under or in connection with this paragraph (e).

 

(f)Each Lender agrees that if any withholding certificate, withholding statement, documentation, authorisations and waivers provided to the COFACE Agent pursuant to paragraph (e) above is or becomes materially inaccurate or incomplete, it shall promptly update such withholding certificate, withholding statement, documentation, authorisations and waivers or promptly notify the COFACE Agent in writing of its legal inability to do so. The COFACE Agent shall provide any such updated withholding certificate, withholding statement, documentation, authorisations and waivers to the Borrower. The COFACE Agent shall not be liable for any action taken by it under or in connection with this paragraph (f).

 

13.8FATCA Deduction

 

(a)Each Party may make any FATCA Deduction it is required to make by FATCA, and any payment required in connection with that FATCA Deduction, and no Party shall be required to increase any payment in respect of which it makes such a FATCA Deduction or otherwise compensate the recipient of the payment for that FATCA Deduction.

 

(b)Each Party shall promptly, upon becoming aware that it must make a FATCA Deduction (or that there is any change in the rate or the basis of such FATCA Deduction) notify the Party to whom it is making the payment and, in addition, shall notify the Borrower, the COFACE Agent and the other Finance Parties.

 

14.Increased Costs

 

14.1Increased Costs

 

(a)Subject to Clause 14.3 (Exceptions) the Borrower shall, within five (5) Business Days of a demand by the COFACE Agent, pay for the account of a Finance Party the amount of any Increased Costs incurred by that Finance Party or any of its Affiliates as a result of:

 

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(i)the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation;

 

(ii)compliance with any law or regulation made after the date of this Agreement; or

 

(iii)the implementation or application of or compliance with (including any change in the interpretation, administration or application of) the Bank for International Settlements’ recommendations on banking laws and regulations published by the Bank for International Settlements on 16 December 2010 in the form of the consultative documents entitled “A global regulatory framework for more resilient banks and banking systems” and “International Framework for Liquidity Risk Measurement, Standards and Monitoring” (collectively, commonly referred to as “Basel III”) or any other law or regulation which implements Basel III (whether such implementation, application or compliance is by a government, regulator, Finance Party or any of its Affiliates) (“Basel III”).

 

(b)In this Agreement “Increased Costs” means:

 

(i)a reduction in the rate of return from a Facility or on a Finance Party’s (or its Affiliate’s) overall capital;

 

(ii)an additional or increased cost; or

 

(iii)a reduction of any amount due and payable under any Finance Document,

 

which is incurred or suffered by a Finance Party or any of its Affiliates to the extent that it is attributable to that Finance Party having entered into its Commitment or funding or performing its obligations under any Finance Document.

 

(c)For the purposes of this Clause 14 (Increased Costs), any regulation imposed by the European Central Bank, the Financial Conduct Authority or the Prudential Regulation Authority in effect as of the Effective Date with respect to fees and costs payable by banks similar to those customarily considered to be “Mandatory Costs” shall be deemed to be an Applicable Law made after the Effective Date.

 

14.2Increased Cost Claims

 

(a)Subject to paragraphs (c) below, a Finance Party intending to make a claim pursuant to Clause 14.1 (Increased Costs) shall notify the COFACE Agent of the event giving rise to the claim, following which the COFACE Agent shall promptly notify the Borrower.

 

(b)Each Finance Party shall, as soon as practicable after a demand by the COFACE Agent, provide a certificate confirming the amount of its Increased Costs.

 

(c)A Finance Party intending to make a claim in relation to Mandatory Costs as contemplated by Clause 14.1(c) (Increased Costs) shall notify (with a copy to the COFACE Agent) the Borrower of its claim in respect of such Mandatory Costs.

 

14.3Exceptions

 

Clause 14.1 (Increased Costs) does not apply to the extent any Increased Cost is:

 

(a)attributable to a Tax Deduction required by law to be made by the Borrower;

 

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(b)compensated for by Clause 13.2 (Tax Indemnity) (or would have been compensated for under Clause 13.2 (Tax Indemnity) but was not so compensated solely because any of the exclusions in paragraph (b) of Clause 13.2 (Tax Indemnity) applied);

 

(c)attributable to the wilful breach by the relevant Finance Party or its Affiliates of any law or regulation; or

 

(d)attributable to a FATCA Deduction required to be made by a Party.

 

15.Other Indemnities

 

15.1Currency Indemnity

 

(a)If any sum due from an Obligor under the Finance Documents (a “Sum”), or any order, judgment or award given or made in relation to a Sum, has to be converted from the currency (the “First Currency”) in which that Sum is payable into another currency (the “Second Currency”) for the purpose of:

 

(i)making or filing a claim or proof against an Obligor;

 

(ii)obtaining or enforcing an order, judgment or award in relation to any litigation or arbitration proceedings,

 

the Borrower shall as an independent obligation, within three (3) Business Days of demand, indemnify each Finance Party to whom that Sum is due against any cost, loss or liability arising out of or as a result of the conversion including any discrepancy between:

 

(A)the rate of exchange used to convert that Sum from the First Currency into the Second Currency; and

 

(B)the rate or rates of exchange available to that person at the time of its receipt of that Sum.

 

(b)The Borrower waives any right it may have in any jurisdiction to pay any amount under the Finance Documents in a currency or currency unit other than that in which it is expressed to be payable.

 

15.2Other Indemnities

 

The Borrower shall, within five (5) Business Days of demand, indemnify each Finance Party (and its Affiliates) against any cost, loss or liability incurred by that Finance Party (or Affiliate) as a result of:

 

(a)the occurrence of any Event of Default;

 

(b)a failure by the Borrower to pay any amount due under a Finance Document on its due date, including without limitation, any cost, loss or liability arising as a result of Clause 30 (Sharing among the Finance Parties);

 

(c)funding, or making arrangements to fund, its participation in a Loan requested by the Borrower in a Utilisation Request but not made by reason of the operation of any one or more of the provisions of this Agreement (other than by reason of default or negligence by that Lender alone);

 

(d)a Loan (or part of a Loan) not being prepaid in accordance with a notice of prepayment given by the Borrower; or

 

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(e)the breach by the Borrower or any member of the Group of any applicable Environmental Laws or Environmental Permits. Any Affiliate of a Finance Party may rely on this Clause 15.2(e).

 

15.3Indemnity to the COFACE Agent

 

The Borrower shall promptly indemnify the COFACE Agent against any cost, loss or liability incurred by the COFACE Agent (acting reasonably) as a result of:

 

(a)investigating any event which it reasonably believes is a Default; or

 

(b)acting or relying on any notice, request or instruction which it reasonably believes to be genuine, correct and appropriately authorised.

 

15.4Indemnity to the Security Agent

 

(a)The Borrower shall promptly indemnify the Security Agent against any cost, loss or liability incurred by the Security Agent as a result of:

 

(i)the protection or enforcement of a Lien expressed to be created under a Security Document; or

 

(ii)the exercise of any of the rights, powers, discretions and remedies vested in it by the Finance Documents or by law.

 

(b)The Security Agent may, in priority to any payment to other Finance Parties, indemnify itself out of the assets subject to a Lien expressed to be created under the Security Documents in respect of, and pay and retain, all sums necessary to give effect to the indemnity in this Clause 15.4.

 

16.Mitigation by the Lenders

 

16.1Mitigation

 

(a)Each Finance Party shall, in consultation with the Borrower, take all reasonable steps to mitigate any circumstances which arise and which would result in any amount becoming payable under or pursuant to, or cancelled pursuant to, any of Clause 7.1 (Illegality), Clause 13 (Tax gross-up and Indemnities) or Clause 14 (Increased Costs) including (but not limited to) transferring its rights and obligations under the Finance Documents to another Affiliate or Facility Office.

 

(b)Paragraph (a) above does not in any way limit the obligations of the Borrower under the Finance Documents.

 

16.2Limitation of Liability

 

(a)The Borrower shall promptly indemnify each Finance Party for all costs and expenses reasonably incurred by that Finance Party as a result of steps taken by it under Clause 16.1 (Mitigation).

 

(b)A Finance Party is not obliged to take any steps under Clause 16.1 (Mitigation) if, in the opinion of that Finance Party (acting reasonably), to do so might be prejudicial to it.

 

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17.Costs and Expenses

 

17.1Transaction Expenses

 

The Borrower shall promptly on demand pay the COFACE Agent, the Security Agent and each Mandated Lead Arranger the amount of all costs and expenses (including legal fees) reasonably incurred by any of them in connection with the negotiation, preparation, printing, execution and syndication of:

 

(a)this Agreement and any other documents referred to in this Agreement; and

 

(b)any other Finance Documents executed after the date of this Agreement.

 

17.2Amendment Costs

 

If:

 

(a)the Borrower requests an amendment, waiver or consent; or

 

(b)an amendment is required pursuant to Clause 31.10 (Change of Currency),

 

the Borrower shall, within three (3) Business Days of demand, reimburse the COFACE Agent and the Security Agent for the amount of all costs and expenses (including legal fees) incurred by the COFACE Agent and the Security Agent in responding to, evaluating, negotiating or complying with that request or requirement.

 

17.3Enforcement Costs

 

The Borrower shall, within three (3) Business Days of demand, pay to each Finance Party the amount of all costs and expenses (including legal fees) incurred by that Finance Party in connection with the enforcement of, or the preservation of any rights under, any Finance Document.

 

17.4Security Agent Expenses

 

The Borrower shall, within three (3) Business Days of demand, pay to the Security Agent the amount of all costs and expenses (including legal fees) incurred by it in connection with the release of any Lien created pursuant to any Security Document.

 

17.5Financial Advisory Appointment

 

The Borrower shall, within three (3) Business Days of demand, pay to the COFACE Agent all fees and expenses payable in connection with the appointment by the COFACE Agent of FTI, Consulting, Inc., (or such other financial advisor acceptable to the COFACE Agent (acting on the instructions of the Majority Lenders)):

 

(a)on and from the Effective Date (for so long as shall be required in order to complete any reports required in connection with the financial year ending 2013), at agreed hourly rates, for the purposes of monitoring the Group’s business and results of operations; and

 

(b)at any time following 31 December 2013 at agreed hourly rates if:

 

(i)an Event of Default as set out in Clauses 23.1 (Non-Payment), 23.2 (Financial Covenants), 23.5 (Cross Default), 23.6 (Insolvency), 23.7 (Insolvency Proceedings) or 23.8 (Creditor’s Process) has occurred;

 

(ii)the Finance Parties receive any request from the Borrower to adjust, or a Lender or COFACE requires any adjustment of, the financial covenants as set out in Clause 20 (Financial Covenants);

 

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(iii)a new business plan is provided to replace the Agreed Business Plan; or

 

(iv)the Borrower (acting reasonably) agrees to any request for such appointment from the COFACE Agent.

 

18.Representations

 

Subject to the disclosures made by the Borrower set out in Schedule 24 (Disclosures), the Borrower makes the representations and warranties set out in this Clause 18 (Representations) to each Finance Party on the Effective Date.

 

18.1Status

 

(a)It is a corporation, duly incorporated and validly existing (and to the extent applicable, in good standing) under the law of its jurisdiction of incorporation.

 

(b)It and each of its Subsidiaries has the power to own its assets and carry on its business as it is being conducted.

 

18.2Binding Obligations

 

Subject to the Reservations:

 

(a)the obligations expressed to be assumed by it in each Transaction Document to which it is a party are legal, valid, binding and enforceable obligations; and

 

(b)(without limiting the generality of paragraph (a) above), each Security Document to which it is a party creates the security interests which that Security Document purports to create and those security interests are valid and effective.

 

18.3Non-Conflict with other Obligations

 

The entry into and performance by it of, and the transactions contemplated by, the Transaction Documents and the granting of the security interests contemplated by the Security Documents do not and will not conflict with:

 

(a)any Applicable Law;

 

(b)the constitutional documents of any member of the Group; or

 

(c)any agreement or instrument binding upon it or any member of the Group or any of its, or any member of the Group’s, assets or constitute a default or termination event (however described) under any such agreement or instrument, where such conflict would have or is reasonably likely to have a Material Adverse Effect.

 

18.4Power and Authority

 

(a)It has the power to enter into, perform and deliver, and has taken all necessary action to authorise its entry into, performance and delivery of, the Transaction Documents to which it is or will be a party and the transactions contemplated by those Transaction Documents.

 

(b)No limit on its powers will be exceeded as a result of the borrowing, grant of security or giving of guarantees or indemnities contemplated by the Transaction Documents to which it is a party.

 

18.5No Proceedings Pending or Threatened

 

No litigation, arbitration or administrative proceedings of or before any court, arbitral body or agency which is not frivolous, vexatious or otherwise an abuse of court process, and which, if adversely determined, could reasonably have a Material Adverse Effect (to the best of its knowledge and belief) have been started against it or any of its Subsidiaries.

 

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18.6Authorisations

 

(a)Each of the Borrower and its Subsidiaries has all material Authorisations required:

 

(i)to enable it lawfully to enter into, exercise its rights and comply with its obligations in the Transaction Documents to which it is a party; and

 

(ii)to make the Transaction Documents to which it is a party admissible in evidence in its jurisdiction of incorporation,

 

have been obtained or effected and are in full force and effect.

 

(b)Each of the Borrower and its Subsidiaries:

 

(i)has all Authorisations required for it to conduct its business as currently conducted, each of which is in full force and effect, is final and not subject to review on appeal and is not the subject of any pending or, to the best of its knowledge, threatened attack by direct or collateral proceeding;

 

(ii)is in compliance with each Authorisation applicable to it and in compliance with all other Applicable Laws relating to it or any of its respective properties; and

 

(iii)has filed in a timely manner all material reports, documents and other materials required to be filed by it under all Applicable Laws with any Governmental Authority and has retained all material records and documents required to be retained by it under Applicable Law,

 

except in each case where the failure to have done so, comply or file could not reasonably be expected to have a Material Adverse Effect.

 

18.7Intellectual Property Matters

 

(a)Each of the Borrower and its Subsidiaries owns or possesses rights to use all material franchises, licences, copyrights, copyright applications, patents, patent rights or licences, patent applications, trademarks, trademark rights, service marks, service mark rights, trade names, trade name rights, copyrights and other rights with respect to the foregoing which are reasonably necessary to conduct its business as currently conducted (the “Intellectual Property”).

 

(b)No event has occurred which permits, or after notice or lapse of time or both would permit, the revocation or termination of any such material rights, and, to the Borrower’s knowledge, neither the Borrower nor any Subsidiary thereof is liable to any person for infringement under Applicable Law with respect to any such rights as a result of its business operations except as could not reasonably be expected to have a Material Adverse Effect.

 

18.8Environmental Matters

 

(a)The properties owned, leased or operated by the Borrower and its Subsidiaries now or in the past do not contain, and to their knowledge have not previously contained, any Hazardous Materials in amounts or concentrations which:

 

(i)constitute or constituted an unremediated violation of applicable Environmental Laws and Environmental Permits; or

 

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(ii)could give rise to a material liability under applicable Environmental Laws and Environmental Permits.

 

(b)To the knowledge of the Borrower and its Subsidiaries, the Borrower, each of its Subsidiaries and such properties and all operations conducted in connection therewith are in compliance, and, at all such times when such properties have been owned or operated by the Borrower or any of its Subsidiaries have been in compliance, with all applicable Environmental Laws and Environmental Permits, and there is no contamination at, under or about such properties or such operations which could interfere with the continued operation of such properties or materially impair the fair saleable value thereof.

 

(c)Neither the Borrower nor any Subsidiary thereof has received any notice of violation, alleged violation, non-compliance, liability or potential liability regarding environmental matters, Hazardous Materials, or compliance with Environmental Laws or Environmental Permits, nor does the Borrower or any Subsidiary thereof have knowledge or reason to believe that any such notice will be received or is being threatened.

 

(d)To the knowledge of the Borrower and its Subsidiaries, Hazardous Materials have not been transported or disposed of to or from the properties owned, leased or operated by the Borrower and its Subsidiaries in violation of, or in a manner or to a location which could give rise to material liability under, Environmental Laws or Environmental Permits, nor have any Hazardous Materials been generated, treated, stored or disposed of at, on or under any of such properties in violation of, or in a manner that could give rise to material liability under, any applicable Environmental Laws.

 

(e)No judicial proceedings or governmental or administrative action is pending or, to the knowledge of the Borrower, threatened under any Environmental Law or Environmental Permits to which the Borrower or any Subsidiary thereof is or will be named as a potentially responsible party, nor are there any consent decrees or other decrees, consent orders, administrative orders or other orders, or other administrative or judicial requirements outstanding under any Environmental Law with respect to the Borrower, any Subsidiary or properties owned, leased or operated by the Borrower or any Subsidiary, now or in the past, that could reasonably be expected to have a Material Adverse Effect.

 

(f)There has been no release, nor to the best of the Borrower’s knowledge, threat of release, of Hazardous Materials at or from properties owned, leased or operated by the Borrower or any Subsidiary, now or in the past, in violation of or in amounts or in a manner that could give rise to liability under Environmental Laws or Environmental Permits that could reasonably be expected to have a Material Adverse Effect.

 

(g)There are no facts, circumstances or conditions relating to the past or present business or operations of the Borrower or any Subsidiary, including the disposal of any wastes, Hazardous Material or other materials, or to the past or present ownership or use of any real property by the Borrower or any Subsidiary, that could reasonably be expected to give rise to an Environmental Claim against or to liability (other than in an immaterial respect) of any Borrower or any Subsidiary under any Environmental Laws or Environmental Permits.

 

18.9ERISA

 

(a)As of the date of this Agreement, neither an Obligor nor any ERISA Affiliate maintains or contributes to, or has any obligation under, any Employee Benefit Plans other than those identified in Schedule 9 (ERISA Plans).

 

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(b)Each Employee Benefit Plan is in compliance in form and operation with its terms and with ERISA and the Code (including Code provisions compliance with which is necessary for any intended favourable tax treatment) and all other Applicable Laws, except where any failure to comply would not, individually or in the aggregate, reasonably be expected to result in any material liability of any Obligor or ERISA Affiliate.

 

(c)Each Employee Benefit Plan that is intended to be qualified under Section 401(a) of the Code has been determined by the Internal Revenue Service to be so qualified, and each trust related to such plan has been determined by the Internal Revenue Service to be exempt under Section 501(a) of the Code, taking into account all applicable tax law changes, and nothing has occurred since the date of each such determination that would reasonably be expected to adversely affect such determination (or, in the case of an Employee Benefit Plan with no determination, nothing has occurred that would materially adversely affect the issuance of a favourable determination by the Internal Revenue Service or otherwise materially adversely affect such qualification).

 

(d)No liability has been incurred by any Obligor or any ERISA Affiliate which remains unsatisfied for any taxes or penalties with respect to any Employee Benefit Plan or any Multiemployer Plan except for a liability that would not, individually or in the aggregate, reasonably be expected to result in a material liability of such Obligor or ERISA Affiliate.

 

(e)Except where the failure of any of the following representations to be correct in all material respects would not, individually or in the aggregate, reasonably be expected to result in a material liability of any Obligor or any ERISA Affiliate, no Obligor or any ERISA Affiliate has:

 

(i)engaged in a non-exempt prohibited transaction described in Section 406 of ERISA or Section 4975 of the Code;

 

(ii)incurred any liability to the PBGC which remains outstanding, or reasonably expects to incur any such liability other than the payment of premiums and there are no premium payments which are within the applicable time limits prescribed by Applicable Law, due and unpaid;

 

(iii)failed to make a required contribution or payment to a Multiemployer Plan within the applicable time limits prescribed by Applicable Law; or

 

(iv)failed to make a required instalment or other required payment under Section 412 of the Code or Section 302 of ERISA.

 

(f)No ERISA Termination Event, which individually or in the aggregate would reasonably be expected to result in a material liability of any Obligor or ERISA Affiliate has occurred or is reasonably expected to occur.

 

(g)Except where the failure of any of the following representations to be correct in all material respects would not, individually or in the aggregate, reasonably be expected to result in a material liability of any Obligor or any ERISA Affiliate, no proceeding, claim (other than a benefits claim in the ordinary course), lawsuit and/or investigation is existing or, to the best knowledge of the Borrower after due inquiry, threatened concerning or involving any:

 

(i)employee welfare benefit plan (as defined in Section 3(1) of ERISA) currently maintained or contributed to any Obligor or any ERISA Affiliate;

 

(ii)Pension Plan; or

 

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(iii)Multiemployer Plan.

 

(h)There exists no Unfunded Pension Liability with respect to any Pension Plan, except for any such Unfunded Pension Liability that individually or together with any other positive Unfunded Pension Liabilities with respect to any Pension Plans, is not reasonably expected to result in a material liability of any Obligor or ERISA Affiliate.

 

(i)If each Obligor and each ERISA Affiliate were to withdraw in a complete withdrawal from all Multiemployer Plans as of the date this assurance is given or deemed given, the aggregate withdrawal liability that would be incurred would not reasonably be expected to result in a material liability of any Obligor or ERISA Affiliate.

 

(j)No Pension Plan which is subject to Section 412 of the Code or Section 302 of ERISA has applied for or received an extension of any amortization period, within the meaning of Section 412 of the Code or Section 302 or 304 of ERISA. No Obligor or ERISA Affiliate has ceased operations at a facility so as to become subject to the provisions of Section 4062(e) of ERISA, withdrawn as a substantial employer so as to become subject to the provisions of Section 4063 of ERISA or ceased making contributions to any Pension Plan subject to Section 4064(a) of ERISA to which it made contributions. No Lien imposed under the Code or ERISA on the assets of any Obligor or any ERISA Affiliate exists or is likely to arise on account of any Pension Plan. No Obligor or ERISA Affiliate has any liability under Section 4069 or 4212(c) of ERISA.

 

18.10Margin Stock

 

(a)Neither the Borrower nor any Subsidiary of it is engaged principally or as one of its activities in the business of extending credit for the purpose of “purchasing” or “carrying” any “margin stock” (as each such term is defined or used, directly or indirectly, in Regulation U of the Board of Governors of the Federal Reserve System).

 

(b)No part of the proceeds of the Loans will be used for purchasing or carrying margin stock or for any purpose which violates, or which would be inconsistent with, the provisions of Regulation T, U or X of such Board of Governors.

 

18.11Government Regulation

 

Neither the Borrower nor any Subsidiary is an “investment company” or a company “controlled” by an “investment company” (as each such term is defined or used in the Investment Company Act of 1940, as amended) and neither the Borrower nor any Subsidiary is, or after giving effect to any Utilisation will be, subject to regulation under the Interstate Commerce Act, as amended, or any other Applicable Law which limits its ability to incur or consummate the transactions contemplated under this Agreement.

 

18.12Material Contracts

 

(a)Schedule 12 (Material Contracts) contains a complete and accurate list of all Material Contracts of the Borrower and its Subsidiaries in effect as of the Effective Date.

 

(b)Other than as set out in Schedule 12 (Material Contracts), each such Material Contract is, and after giving effect to the consummation of the transactions contemplated by the Finance Documents will be, in full force and effect in accordance with the terms thereof.

 

(c)The Borrower and its Subsidiaries have delivered to the COFACE Agent a true and complete copy of each Material Contract required to be listed on Schedule 12 (Material Contracts) (including all amendments with respect thereto).

 

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(d)Neither the Borrower nor any Subsidiary (nor, to the knowledge of the Borrower, any other party thereto) is in breach of or in default under any Material Contract in any material respect.

 

18.13Employee Relations

 

(a)Each of the Borrower and its Subsidiaries has a work force in place adequate to conduct its business as currently conducted and is not, as of the date of this Agreement, party to any collective bargaining agreement nor has any labour union been recognised as the representative of its employees except as set out in Schedule 13 (Labour and Collective Bargaining Agreements).

 

(b)The Borrower knows of no pending, threatened or contemplated strikes, work stoppage or other collective labour disputes involving its employees or those of its Subsidiaries that could reasonably be expected to have a Material Adverse Effect.

 

18.14Burdensome Provisions

 

No Subsidiary is party to any agreement or instrument or otherwise subject to any restriction or encumbrance that restricts or limits its ability to make dividend payments or other distributions in respect of its Capital Stock to the Borrower or any Subsidiary or to transfer any of its assets or properties to the Borrower or any other Subsidiary in each case other than existing under or by reason of the Finance Documents or Applicable Law.

 

18.15Financial Statements

 

(a)The audited and unaudited financial statements most recently delivered pursuant to Clause 19 (Information Undertakings) are complete and correct and fairly present in all material respects on a Consolidated basis the assets, liabilities and financial position of the Borrower and its Subsidiaries as at such dates, and the results of the operations and changes of financial position for the periods that ended (other than the absence of footnotes and customary year-end adjustments for unaudited financial statements).

 

(b)All such financial statements, including the related schedules and notes thereto, have been prepared in accordance with GAAP.

 

(c)Such financial statements show all material indebtedness and other material liabilities, direct or contingent, of the Borrower and its Subsidiaries as of the dates thereof, including material liabilities for taxes, material commitments, and Financial Indebtedness, in each case, to the extent required to be disclosed under GAAP.

 

18.16No Material Adverse Change

 

Since 10 May 2013, there has been no material adverse change in the properties, business, operations, prospects or condition (financial or otherwise) of the Borrower and its Subsidiaries taken as a whole and no event has occurred or condition arisen that could reasonably be expected to have a Material Adverse Effect.

 

18.17Solvency

 

As of the Effective Date and after giving effect to each Loan, each Obligor (other than Globalstar Leasing LLC) will be Solvent.

 

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18.18Titles to Properties

 

Each of the Borrower and its Subsidiaries has such title to the real property owned or leased by it as necessary to the conduct of its business as currently conducted and valid and legal title to all of its personal property and assets, including, but not limited to, those reflected on the most recently delivered Consolidated balance sheets of the Borrower and its Subsidiaries delivered pursuant to Clause 19 (Information Undertakings), except those which have been disposed of by the Borrower or its Subsidiaries subsequent to the dates of such balance sheets which dispositions have been in the ordinary course of trading or as otherwise expressly permitted under this Agreement.

 

18.19Insurance

 

The properties of the Borrower and its Subsidiaries are insured with financially sound and reputable insurance companies which are not Affiliates of the Borrower, in such amounts, with such deductibles and covering such risks as required by this Agreement.

 

18.20Liens

 

From Financial Close:

 

(a)none of the properties and assets of the Borrower or any Subsidiary thereof is subject to any Lien, except Permitted Liens; and

 

(b)neither the Borrower nor any Subsidiary thereof has signed any financing statement or any security agreement authorising any secured party thereunder to file any financing statements, except to perfect Permitted Liens.

 

18.21Financial Indebtedness and Guarantee Obligations

 

(a)Schedule 14 (Financial Indebtedness and Guarantee Obligations) is a complete and correct listing of all Financial Indebtedness of the Borrower and its Subsidiaries as of the Effective Date in excess of US$1,000,000.

 

(b)As of the Effective Date, the amount of all Financial Indebtedness of the Borrower and its Subsidiaries (and not set out in Schedule 14 (Financial Indebtedness and Guarantee Obligations)) is no greater than US$1,000,000.

 

(c)The Borrower and its Subsidiaries have performed and are in compliance with all of the material terms of such Financial Indebtedness and all instruments and agreements relating thereto, and no default or event of default, or event or condition which with notice or lapse of time or both would constitute such a default or event of default on the part of the Borrower or any of its Subsidiaries exists with respect to any such Financial Indebtedness.

 

18.22Communication Licences

 

(a)Schedule 15 (Communication Licences) accurately and completely lists, as of the Effective Date, for the Borrower and each of its Subsidiaries, all Material Communications Licences (and the expiration dates thereof) granted or assigned to the Borrower or any Subsidiary, including, without limitation for:

 

(i)each Satellite owned by the Borrower or any of its Subsidiaries, all space station licences or authorisations, including placement on the FCC’s “Permitted Space Station List” for operation of Satellites with C-band links issued or granted by the FCC or the ANFR to the Borrower or any of its Subsidiaries; and

 

(ii)for each Earth Station of the Borrower and its Subsidiaries.

 

(b)The Communications Licences set out in Schedule 15 (Communication Licences) include all material authorisations, licences and permits issued by the FCC, the ANFR or any other Governmental Authority that are required or necessary for the operation and the conduct of the business of the Borrower and its Subsidiaries, as now conducted.

 

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(c)Each Communications Licence is expected to be renewed and the Borrower knows of no reason why such Communications Licence would not be renewed.

 

(d)The Borrower and its Subsidiaries have filed all material applications with the FCC or the ANFR necessary for the Launch and operation of the Borrower’s second-generation satellite constellation and the Borrower is not aware of any reason why such applications should not be granted.

 

(e)Each Communications Licence set out in Schedule 15 (Communication Licences) is issued in the name of the Subsidiary indicated on such schedule.

 

(f)Each Material Communications Licence is in full force and effect.

 

(g)The Borrower has no knowledge of any condition imposed by the FCC, the ANFR or any other Governmental Authority as part of any Communications Licence which is neither set forth on the face thereof as issued by the FCC, the ANFR or any other Governmental Authority nor contained in the rules and regulations of the FCC, the ANFR or any other Governmental Authority applicable generally to telecommunications activities of the type, nature, class or location of the activities in question.

 

(h)Each applicable location of the Borrower or any of its Subsidiaries has been and is being operated in all material respects in accordance with the terms and conditions of the Communications Licence applicable to it and Applicable Law, including but not limited to the Communications Act and the rules and regulations issues thereunder.

 

(i)No proceedings are pending or, to the Borrower’s knowledge are, threatened which may result in the loss, revocation, modification, non-renewal, suspension or termination of any Communications Licence, the issuance of any cease and desist order or the imposition of any fines, forfeitures or other administrative actions by the FCC, the ANFR or any other Governmental Authority with respect to any operations of the Borrower and its Subsidiaries, which in any case could reasonably be expected to have a Material Adverse Effect.

 

18.23Satellites

 

(a)All Satellites are owned by the Borrower or a Subsidiary that is an Obligor.

 

(b)Schedule 16 (Satellites) accurately and completely lists as of the Effective Date, the flight model number of each of the Satellites owned by the Borrower and its Subsidiaries, and for each Satellite whether it is operational in-orbit or spare in-orbit.

 

18.24[Intentionally Omitted]

 

18.25Pari Passu Ranking

 

Each Obligor’s payment obligations under the Finance Documents rank at least pari passu with the claims of all its unsecured and unsubordinated creditors, except for obligations mandatorily preferred by law applying to companies generally.

 

18.26OFAC

 

(a)None of the Borrower, any member of the Thermo Group, any Subsidiary of the Borrower or any Affiliate of the Borrower:

 

(i)is a Sanctioned Person;

 

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(ii)has more than ten per cent. (10%) of its assets in Sanctioned Entities; or

 

(iii)derives more than ten per cent. (10%) of its operating income from investments in, or transactions with Sanctioned Persons or Sanctioned Entities.

 

(b)The proceeds of any Loan will not be used and have not been used to fund any operations in, finance any investments or activities in, or make any payments to, a Sanctioned Person or a Sanctioned Entity.

 

18.27Governing Law and Enforcement

 

(a)Subject to the Reservations, the choice of governing law of the Finance Documents will be recognised and enforced in its jurisdiction of incorporation.

 

(b)Subject to the Reservations, any judgment obtained in relation to a Finance Document in the jurisdiction of the governing law of that Finance Document will be recognised and enforced in its jurisdiction of incorporation.

 

18.28No Filing or Stamp Taxes

 

Under:

 

(a)the laws of the Borrower’s or any of its Subsidiaries’ jurisdiction of incorporation; and

 

(b)the federal laws of the United States,

 

it is not necessary that the Finance Documents be filed, recorded or enrolled with any court or other authority in that jurisdiction or that any stamp, registration, notarial or similar Taxes or fees be paid on or in relation to the Finance Documents or the transactions contemplated by the Finance Documents other than:

 

(i)delivery of proper financing statements (Form UCC-1 or such other financing statements or similar notices as shall be required by Applicable Law) fully executed for filing under the UCC or other appropriate filing offices of each jurisdiction as may be necessary to perfect a Lien purported to be created by a Security Document; and

 

(ii)any recording with the United States Patent and Trademark Office and/or Copyright Office to perfect the Liens on intellectual property created by the Collateral Agreement,

 

which registrations, filings and fees will be made and paid promptly after the date of the relevant Finance Document.

 

18.29Deduction of Tax

 

It is not required to make any deduction for or on account of Tax from any payment it may make under any Finance Document.

 

18.30No Default

 

(a)No Event of Default and, on the Effective Date, no Default is continuing or is reasonably likely to result from the making of any Loan or the entry into, the performance of, or any transaction contemplated by, any Transaction Document.

 

(b)No other event or circumstance is outstanding which constitutes (or, with the expiry of a grace period, the giving of notice, the making of any determination or any combination of any of the foregoing, would constitute) a default or termination event (however described) under the Transaction Documents, which has not been waived by the relevant parties hereto.

 

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(c)No other event or circumstance is outstanding which constitutes (or, with the expiry of a grace period, the giving of notice, the making of any determination or any combination of any of the foregoing, would constitute) a default or termination event (however described) under any other agreement or instrument which is binding on it or any of its Subsidiaries or to which its (or any of its Subsidiaries) assets are subject which has or is reasonably likely to have a Material Adverse Effect.

 

18.31No Misleading Information

 

(a)All factual information provided in writing by it to the Lenders was true, complete and accurate in all material respects to the best of its knowledge and belief as at the date it was provided or as at the date (if any) at which it is stated.

 

(b)All financial projections provided by it have been prepared on the basis of recent historical information and on the basis of reasonable assumptions (in the case of projections made by third parties, to the best of its knowledge and belief).

 

(c)To the best of its knowledge and belief, no material information has been given or withheld by it that results in any information provided to the Lenders by it being incomplete, untrue or misleading in any material respect.

 

18.32Group Structure Chart

 

The Group Structure Chart set out at Schedule 23 (Group Structure Chart) is true, complete and accurate in all material respects.

 

18.33No Immunity

 

None of the members of the Group or any of their assets is entitled to immunity from suit, execution, attachment or other legal process.

 

18.34Tax Returns and Payments

 

(a)Each of the Borrower and its Subsidiaries has timely filed with the appropriate taxing authority, all returns, statements, forms and reports for taxes (the “Returns”) required to be filed by or with respect to the income, properties or operations of the Borrower and/or any of its Subsidiaries.

 

(b)The Returns accurately reflect in all material respects all liability for taxes of the Borrower and its Subsidiaries as a whole for the periods covered thereby.

 

(c)The Borrower and each of its Subsidiaries have paid all taxes payable by them other than those contested in good faith and adequately disclosed and for which adequate reserves have been established in accordance with generally accepted accounting principles.

 

(d)There is no action, suit, proceeding, investigation, audit, or claim now pending or, to the best knowledge of the Borrower or any of its Subsidiaries, threatened by any authority regarding any taxes relating to the Borrower or any of its Subsidiaries which, if adversely determined, could reasonably be expected to have a Material Adverse Effect.

 

(e)Neither the Borrower nor any of its Subsidiaries has entered into an agreement or waiver or been requested to enter into an agreement or waiver extending any statute of limitations relating to the payment or collection of taxes of the Borrower or any of its Subsidiaries, or is aware of any circumstances that would cause the taxable years or other taxable periods of the Borrower or any of its Subsidiaries not to be subject to the normally applicable statute of limitations.

 

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18.35Commercial Contracts

 

As of the Effective Date, the Borrower has not exercised the “Optional Launches” (as such term is defined in the Launch Services Contract) pursuant to the Launch Services Contract.

 

18.36Notes and Purchase Agreement

 

(a)All obligations owed to the holders of the 8% Old Notes or the 5% Notes:

 

(i)are, subject to the Reservations, the legal, valid, binding and enforceable obligations of the Borrower; and

 

(ii)are and shall remain fully subordinated to the repayment in full of the indebtedness under this Agreement on the terms set out in the relevant documentation (irrespective of whether the maturity date of the relevant notes has occurred and irrespective of whether the Final Maturity Date is amended from time to time) and such obligations have not been terminated or otherwise cancelled by the relevant holders of such notes.

 

(b)The obligations of the Borrower and Terrapin under the Purchase Agreement:

 

(i)are, subject to the Reservations, the legal, valid, binding and enforceable obligations of the Borrower, and, to the best of the Borrower’s knowledge, Terrapin; and

 

(ii)have not been repudiated, terminated or otherwise cancelled by the Borrower or Terrapin and there is no breach thereunder by either party thereto.

 

(c)The Borrower represents that, to the best of its knowledge, the amount of notes held by each of the Borrower, Thermo, any Subsidiary Guarantor and James Monroe III in respect of the 8% Old Notes and the 5% Notes has not changed since the date of the Global Deed of Amendment and Restatement, and that no such party has entered into any written agreement, side letter, undertaking or understanding relating to such person’s ownership of or control of any voting or economic rights associated with the 8% Old Notes or the 5% Notes since the date of the Global Deed of Amendment and Restatement.

 

18.37Repetition

 

The Repeating Representations are made by the Borrower by reference to the facts and circumstances then existing on:

 

(a)the date of each Utilisation Request;

 

(b)each Utilisation Date; and

 

(c)the first day of each Interest Period.

 

19.Information Undertakings

 

The undertakings in this Clause 19 (Information Undertakings) remain in force from the date of this Agreement for so long as any amount is outstanding under the Finance Documents or any Commitment is in force. The Borrower will furnish, or cause to be furnished, to the COFACE Agent the information required by this Clause 19 (Information Undertakings) in sufficient copies for all the Lenders.

 

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19.1Quarterly Financial Statements

 

(a)As soon as practicable and in any event within forty five (45) days after the end of each of the first three (3) fiscal quarters of each Fiscal Year (and in the case of paragraph (v) only, after the end of each fiscal quarter of each Fiscal Year) (or, if the date of any required public filing is earlier, no later than the date that is the fifth Business Day immediately following the date of any required public filing thereof after giving effect to any extensions granted with respect to such date):

 

(i)Form 10-Q;

 

(ii)an unaudited Consolidated balance sheet of the Borrower and its Subsidiaries as of the close of such fiscal quarter;

 

(iii)the notes (if any) relating to any of the financial statements delivered under this Clause 19.1;

 

(iv)unaudited Consolidated statements of income, retained earnings and cash flows;

 

(v)a report with respect to the Borrower’s key performance indicators in substantially the same form as Schedule 19 (Key Performance Indicators); and

 

(vi)a report containing management’s discussion and analysis of such financial statements for the fiscal quarter then ended and that portion of the Fiscal Year then ended,

 

all in reasonable detail setting forth in comparative form the corresponding figures as of the end of and for the corresponding period in the preceding Fiscal Year and prepared by the Borrower in accordance with GAAP and, if applicable, containing disclosure of the effect on the financial position or results of operations of any change in the application of accounting principles and practices during the period, and certified by the chief financial officer of the Borrower to present fairly in all material respects the financial condition of the Borrower and its Subsidiaries on a Consolidated basis as of their respective dates and the results of operations of the Borrower and its Subsidiaries for the respective periods then ended, subject to normal year end adjustments.

 

(b)Upon request by the COFACE Agent and at the cost of the Borrower, the Borrower shall procure that the Group’s management shall meet in person or by telephone (as the Lenders shall require) with the Lenders on a quarterly basis in order to discuss key strategic, operational, Capital Expenditure, market pricing, customer, distributor and regulatory issues.

 

19.2Annual Financial Statements

 

(a)As soon as practicable and in any event within ninety (90) days after the end of each Fiscal Year (or, if the date of any required public filing is earlier, the date that is no later than the fifth Business Day immediately following the date of any required public filing thereof after giving effect to any extensions granted with respect to such date):

 

(i)Form 10-K;

 

(ii)an audited Consolidated balance sheet of the Borrower and its Subsidiaries as of the close of such Fiscal Year;

 

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(iii)the notes (if any) relating to any of the financial statements delivered under this Clause 19.2;

 

(iv)audited Consolidated statements of income, retained earnings and cash flows; and

 

(v)a report containing management’s discussion and analysis of such financial statements for the Fiscal Year then ended,

 

all in reasonable detail setting forth in comparative form the corresponding figures as of the end of and for the preceding Fiscal Year and prepared in accordance with GAAP and, if applicable, containing disclosure of the effect on the financial position or results of operations of any change in the application of accounting principles and practices during the year.

 

(b)Such annual financial statements shall be audited by the independent certified public accounting firm separately notified to the COFACE Agent prior to the date of this Agreement or such other firm notified to the COFACE Agent (and acceptable to the COFACE Agent), and accompanied by a report thereon by such certified public accountants that is not qualified with respect to scope limitations imposed by the Borrower or any of its Subsidiaries or with respect to accounting principles followed by the Borrower or any of its Subsidiaries not in accordance with GAAP.

 

19.3Annual Business Plan and Financial Projections

 

(a)As soon as practicable and in any event no later than 31 March in any calendar year, a draft updated business plan of the Borrower and its Subsidiaries for the ensuing four (4) fiscal quarters (“Draft Business Plan”), such Draft Business Plan to be in substantially the same form as the Agreed Business Plan delivered to the COFACE Agent on or prior to the Effective Date and prepared, to the extent applicable, in accordance with GAAP and to include, on a quarterly basis, the following:

 

(i)information relating to the amounts outstanding under the Convertible Notes;

 

(ii)an operating and capital budget in respect of the next three (3) succeeding Fiscal Years;

 

(iii)a projected income statement;

 

(iv)a statement of cash flows on a three (3) year projected basis (including, calculations (in reasonable detail) demonstrating compliance with each of the financial covenants set out in Clause 20 (Financial Covenants)) and balance sheet; and

 

(v)a report setting forth management’s operating and financial assumptions underlying such projections.

 

(b)The COFACE Agent shall no later than twenty (20) Business Days after receipt of the Draft Business Plan provide to the Borrower:

 

(i)any comments and/or proposed amendments to the Draft Business Plan; or

 

(ii)a confirmation that the Draft Business Plan is the Agreed Business Plan.

 

(c)Subject to paragraph (e) below, in the case of paragraph (b)(i) above, the Borrower shall, in good faith, consider any such comments and/or proposed amendments to the Draft Business Plan and, within five (5) Business Days, confirm to the COFACE Agent whether or not the comments and/or amendments proposed by the COFACE Agent have been accepted by the Borrower. If such comments and/or proposed amendments are:

 

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(i)agreed by the Borrower, the Draft Business Plan shall constitute the then current Agreed Business Plan; and

 

(ii)not agreed by the Borrower, then the Borrower, the Lenders and, to the extent applicable, any Financial Advisor, shall consult, for a period not exceeding five (5) Business Days (the “Consultation Period”), in good faith in order to agree the Draft Business Plan.

 

(d)Subject to paragraph (e) below, in the case of paragraph (c)(ii) above, following the end of the Consultation Period the Draft Business Plan agreed to by the Borrower shall constitute the then current Agreed Business Plan.

 

(e)Any:

 

(i)projections contained in the Draft Business Plan and referred to in the definition of “Adjusted Consolidated EBITDA”;

 

(ii)level of Permitted Vendor Indebtedness and cash paying Subordinated Indebtedness referred to in Clause 20.5 (Net Debt to Adjusted Consolidated EBITDA) and contained in the Draft Business Plan;

 

(iii)material known contingent liability related to any litigation, arbitration, administrative, governmental, regulatory or other investigations, proceedings or disputes referred to in Clause 23.13(b) (Litigation) contemplated by the Draft Business Plan; and

 

(iv)change in a Draft Business Plan to the amount of Financial Indebtedness that may be incurred by the Borrower in connection with cash paying Subordinated Indebtedness above the amounts set out in the Agreed Business Plan delivered on or prior to the Effective Date,

 

must be satisfactory in all respects to the COFACE Agent. Notwithstanding the foregoing, if following the end of the Consultation Period the Borrower and the COFACE Agent are unable to agree on any of the items in the Draft Business Plan referred to in this paragraph (e) then the matter shall be referred to a Financial Advisor in accordance with paragraph (f).

 

(f)If a dispute exists pursuant to paragraph (e) above then the outstanding issue will be resolved by the Financial Advisor which shall:

 

(i)act as an expert and not as an arbitrator; and

 

(ii)be required to determine the matter referred to them within fifteen (15) Business Days of the referral having been made.

 

(g)Upon the decision of a Financial Advisor, the Draft Business Plan shall be updated by the Borrower to reflect such determination, and the revised Draft Business Plan shall constitute the Agreed Business Plan.

 

(h)Following the Draft Business Plan becoming the Agreed Business Plan, the Borrower shall deliver promptly to the COFACE Agent the Agreed Business Plan accompanied by a certificate from a Responsible Officer of the Borrower to the effect that, to the best of such officer’s knowledge, such projections are estimates made in good faith (based on reasonable assumptions) of the financial condition and operations of the Borrower and its Subsidiaries for such four (4) fiscal quarter period and in relation to the operating and capital budget, in respect of the next three (3) succeeding Fiscal Years.

 

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19.4Compliance Certificate

 

At each time:

 

(a)financial statements are delivered pursuant to Clause 19.1 (Quarterly Financial Statements) or Clause 19.2 (Annual Financial Statements);

 

(b)the information and other documentation is delivered pursuant to Clause 19.3 (Annual Business Plan and Financial Projections); and

 

(c)at such other times as the COFACE Agent shall reasonably request,

 

a Compliance Certificate signed by a Responsible Officer and accompanied by a report from the auditors of the Borrower in substantially the form set out in Schedule 32 (Form of Auditors Report) or such other form as shall be acceptable to the COFACE Agent, confirming compliance by the Borrower with each of the financial covenants set out in Clause 20 (Financial Covenants) together with, for the fiscal period covered by such financial statements or information (as the case may be):

 

(i)an Adjusted Consolidated EBITDA Reconciliation;

 

(ii)a reconciliation of the Excess Cash Flow;

 

(iii)details of all Spectrum Cash Flow and Spectrum Sales;

 

(iv)details of all relevant amounts for the purposes of the calculation of the cash sweeps set out in Clauses 7.3 (Mandatory PrepaymentCash Sweep of Spectrum Cash Flow), 7.4 (Mandatory PrepaymentExcess Cash Flow) 7.8 (Mandatory Prepayment – Cash Sweep Following Spectrum Sale) and 7.9 (Mandatory Prepayment – Cash Sweep Following Equity Issuance and Debt Issuance); and

 

(v)details of the shareholders of record of the Borrower.

 

19.5Other Reports

 

(a)Upon request by the COFACE Agent, copies of all relevant public documents required by its independent public accountants in connection with their auditing function, including, without limitation, any management report and any management responses thereto.

 

(b)As soon as practicable and in any event no later than 31 March in any calendar year, and at any time upon the reasonable request of the COFACE Agent, a Satellite health report prepared by the Borrower and certified by a Responsible Officer setting forth the operational status of each Satellite (other than Satellites yet to be launched) based on reasonable assumptions of the Borrower made in good faith and including such information with respect to the projected solar array life based on the total Satellite power requirements, projected battery life based on total Satellite power requirements, projected Satellite life, information concerning the availability of spare Satellites and such other information pertinent to the operation of such Satellite as the COFACE Agent may reasonably request, it being understood that to the extent that any such Satellite health report contains any forward looking statements, estimates or projections, such statements, estimates or projections are subject to significant uncertainties and contingencies, many of which are beyond the Borrower’s control, and no assurance can be given that such forward looking statements, estimates or projections will be realised, provided that nothing in this paragraph (b) shall require the Borrower to delivery any information to any Lender to the extent delivery of such information is restricted by applicable law or regulation.

 

90
 

 

(c)No less than quarterly, a Satellite health report prepared by the Borrower and certified by a Responsible Officer including the following:

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