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EXECUTION COPY
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ARIANESPACE CUSTOMER LOAN AGREEMENT
Dated as of July 22, 1997
between
CD RADIO INC.
and
ARIANESPACE FINANCE S.A.
Relating to Launch # 2
---------------------------------------------
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TABLE OF CONTENTS
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Page
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SECTION 1. DEFINITIONS......................................................................................... 1
1.01 Defined Terms................................................................................. 1
1.02 Other Definitional Provisions................................................................ 44
SECTION 2. LOAN PROVISIONS.................................................................................... 46
2.01 Amounts and Terms of Commitments............................................................. 46
2.02 Manner of Borrowing Tranche A Loans.......................................................... 47
2.03 Procedure for Conversion to a Tranche B Loan................................................. 48
2.04 Deconversion and Reconversion................................................................ 49
2.05 Prepayments.................................................................................. 49
2.06 Repayment.................................................................................... 53
2.07 Interest..................................................................................... 53
2.08 Fees......................................................................................... 54
2.09 Computation of Interest and Fees............................................................. 54
2.10 Payments by the Customer..................................................................... 55
2.11 Security..................................................................................... 55
2.12 Note......................................................................................... 56
2.13 ECA Enhancement.............................................................................. 56
2.14 ECA Additional Terms and Conditions.......................................................... 58
SECTION 3. TAXES AND YIELD PROTECTION......................................................................... 58
3.01 Taxes........................................................................................ 58
3.02 Increased Costs and Reduction of Return...................................................... 61
3.03 Funding Losses............................................................................... 64
3.04 Inability to Determine Rates................................................................. 65
SECTION 4. CONDITIONS PRECEDENT............................................................................... 66
4.01 Conditions to Initial Tranche A Loan......................................................... 66
4.02 Conversion Conditions........................................................................ 68
4.03 Tranche B Conditions Precedent............................................................... 70
4.04 Conditions to All Loans...................................................................... 76
SECTION 5. REPRESENTATIONS AND WARRANTIES..................................................................... 77
5.01 Existence and Power.......................................................................... 77
5.02 Authorizations; No Contravention............................................................. 77
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5.03 Government Approvals......................................................................... 78
5.04 Binding Effect............................................................................... 79
5.05 Litigation................................................................................... 79
5.06 No Default................................................................................... 80
5.07 Use of Proceeds.............................................................................. 80
5.08 Title to Assets.............................................................................. 80
5.09 Taxes........................................................................................ 81
5.10 Financial Condition.......................................................................... 81
5.11 Environmental Matters........................................................................ 82
5.12 Subsidiaries................................................................................. 82
5.13 Insurance.................................................................................... 83
5.14 Project Compliance........................................................................... 83
5.15 Collateral................................................................................... 83
5.16 Collateral Documents......................................................................... 83
5.17 Sufficiency of Loan Documents and Satellite
Contracts.................................................................................... 84
5.18 Disclosure................................................................................... 84
5.19 Effectiveness of Loan Documents, Satellite
Contracts and Qualified Lease Agreements..................................................... 85
5.20 Employee Benefit Liabilities................................................................. 85
5.21 Investment Company Act....................................................................... 85
SECTION 6. AFFIRMATIVE COVENANTS.............................................................................. 85
6.01 Financial Statements......................................................................... 85
6.02 Certificates; Other Information.............................................................. 87
6.03 Notices...................................................................................... 88
6.04 Preservation of Existence, Etc............................................................... 89
6.05 Maintenance of Assets........................................................................ 89
6.06 Maintenance of Insurance..................................................................... 89
6.07 Payment of Obligations....................................................................... 96
6.08 Compliance with Laws......................................................................... 96
6.09 Inspection of Property and Books and Records................................................. 96
6.10 Environmental Laws........................................................................... 97
6.11 Use of Proceeds.............................................................................. 98
6.12 Project Maintenance.......................................................................... 98
6.13 Telecommunications Approvals................................................................. 98
6.14 Government Approvals......................................................................... 98
6.15 Rate Contracts............................................................................... 99
6.16 Operational Control and Re Export............................................................ 99
6.17 Performance of Loan Documents............................................................... 100
6.18 Performance of Satellite Contracts.......................................................... 100
6.19 Performance of Qualified Lease Agreements................................................... 101
6.20 Orbital Position. ......................................................................... 101
6.21 Export License.............................................................................. 101
6.22 In-Orbit Commissioning...................................................................... 101
6.23 Satellite Operational Reports............................................................... 101
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6.24 Transponder Lease Agreements................................................................ 101
6.25 Further Assurances.......................................................................... 102
6.26 Priorities.................................................................................. 103
SECTION 7. NEGATIVE COVENANTS................................................................................ 103
7.01 Limitation on Liens......................................................................... 103
7.02 Disposition of Collateral................................................................... 104
7.03 Disposition of Assets Other Than Collateral................................................. 105
7.04 Transactions with Affiliates................................................................ 106
7.05 Notice of Indebtedness...................................................................... 106
7.06 Lease Obligations........................................................................... 106
7.07 Capital Expenditures........................................................................ 107
7.08 Change in Structure; Consolidations and Mergers............................................. 107
7.09 Accounting Changes.......................................................................... 108
7.10 Business.................................................................................... 108
7.11 Military Activities......................................................................... 108
7.12 Loan Documents.............................................................................. 108
7.13 Satellite Contracts; Qualified Lease Agreements............................................. 109
7.14 Loans, Deposits and Investments............................................................. 110
7.15 Subordinated Indebtedness................................................................... 111
SECTION 8. EVENTS OF DEFAULT................................................................................. 111
8.01 Events of Default........................................................................... 111
8.02 Remedies.................................................................................... 119
8.03 Rights Not Exclusive........................................................................ 120
SECTION 9. ADDITIONAL LOAN PROVISIONS........................................................................ 120
9.01 Category 3 Preview.......................................................................... 120
9.02 Conversion Process ........................................................................ 124
9.03 Additional Collateral....................................................................... 129
9.04 Security Interest in Collateral............................................................. 130
SECTION 10. MISCELLANEOUS.................................................................................... 134
10.01 Amendments and Waivers...................................................................... 134
10.02 Notices..................................................................................... 134
10.03 No Waiver; Cumulative Remedies.............................................................. 134
10.04 Costs and Expenses; Indemnification......................................................... 135
10.05 Successors and Assigns...................................................................... 137
10.06 Assignment.................................................................................. 137
10.07 Currency Indemnity.......................................................................... 138
10.08 Set-off..................................................................................... 139
10.09 Counterparts................................................................................ 139
10.10 Severability................................................................................ 140
10.11 GOVERNING LAW AND JURISDICTION.............................................................. 140
10.12 WAIVER OF JURY TRIAL........................................................................ 141
10.13 Entire Agreement............................................................................ 142
10.14 Confidentiality............................................................................. 142
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10.15 Headings.................................................................................... 142
10.16 No Third Party Beneficiaries................................................................ 142
10.17 Survival.................................................................................... 143
10.18 Language.................................................................................... 143
10.19 Determinations by AEF....................................................................... 143
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ANNEXES
ANNEX 1 CATEGORY 1 CUSTOMER
ANNEX 2 CATEGORY 2 CUSTOMER
ANNEX 3 CATEGORY 3 CUSTOMER
ANNEX 4 LIST OF COUNTRIES
ANNEX 5 ACCEPTABLE CURRENCIES
ANNEX 6 LIST OF PERMITTED LOCATIONS
SCHEDULES
SCHEDULE 5.03 GOVERNMENT APPROVALS
SCHEDULE 5.05 LITIGATION
SCHEDULE 5.10 BASE FINANCIAL STATEMENTS
SCHEDULE 5.11 ENVIRONMENTAL CLAIMS
SCHEDULE 5.12A SUBSIDIARIES
SCHEDULE 5.12B EQUITY INVESTMENTS
SCHEDULE 10.02 ADDRESSES FOR NOTICES
EXHIBITS
EXHIBIT A FORM OF NOTICE OF DRAWDOWN
EXHIBIT B FORM OF ASSIGNMENT AND ACCEPTANCE
EXHIBIT C FORM OF NOTE
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This CUSTOMER LOAN AGREEMENT is entered into as of July 22, 1997, between CD
RADIO INC., a corporation organized under the laws of Delaware (the "CUSTOMER")
and ARIANESPACE FINANCE S.A., a company organized under the laws of Luxembourg
("AEF").
WHEREAS, AEF has agreed to make available to the Customer certain loans upon
the terms and conditions set forth in this Agreement;
WHEREAS, the Lenders are providing loans to AEF for the purpose of funding the
loans contemplated by this Agreement;
WHEREAS, AE and CD Radio Inc., as the LSA Party have entered into the Launch
Services Agreement for the launch of the Satellite; and
WHEREAS, the execution and delivery of the Launch Services Agreement and the
Multiparty Agreement related thereto constitute the basis upon which AEF has
agreed to make the loans contemplated by this Agreement; and
NOW, THEREFORE, in consideration of the mutual agreements, provisions and
covenants contained herein, the parties agree as follows:
SECTION 1. DEFINITIONS
1.011 DEFINED TERMS. Unless expressly defined otherwise herein, capitalized
terms shall have the meanings set forth in this Section 1.01:
"ACCEPTABLE CURRENCY" means a freely transferable currency of a
country listed on ANNEX 5 hereto, the Euro or the ECU, provided that
the ECU shall cease to be an Acceptable Currency upon the adoption and
implementation of the Euro and any obligation denominated in the ECU
shall provide that it is convertible into the Euro upon such
implementation.
"ACCOUNT BANK" means Credit Lyonnais as account bank in such capacity,
together with its successors in such capacity, as designated by AEF.
"AE" means Arianespace S.A., a company organized under the laws of
France.
"AE ACCOUNT" means account number 036122-43, established by AE with
the Account Bank at its office in Luxembourg as such account may be
renumbered or any successor account identified by AEF to the Customer
from time to time.
"AEF" has the meaning specified in the preamble to this Agreement.
"AFFILIATE" means, as to any Person, any other Person, directly or
indirectly, controlling, controlled by, or under common control with,
such first-named Person. A Person shall be deemed to control another
Person if the controlling Person
<PAGE> 7
possesses, directly or indirectly, the power to direct or cause the
direction of the management and policies of the other Person, whether
through the ownership of voting stock, by contract or otherwise.
Without limitation, any Person that owns directly or indirectly twenty
percent (20%) or more of the voting stock or other equity interests of
a Person shall, for the purposes of this Agreement and any other Loan
Document, be deemed to control the other Person.
"AGREEMENT" means this Customer Loan Agreement.
"APPLICABLE MARGIN" means (a) during the Tranche A Term, the
percentage amount as set forth in the Fee Letter and (b) during the
Tranche B Term, the Customer Tranche B Margin set forth in ANNEX 1, 2
OR 3, as applicable to the Customer on and after the Conversion Date
in relation to the designation by AEF of the Customer into a Customer
Category pursuant to Section 9, provided that, if the Customer Tranche
B Margin shall be as set forth in ANNEX 1 as a result of ECA
Enhancement being procured with respect to the Customer, pursuant to
Section 2.13, and such ECA Enhancement shall at any time during the
Tranche B Term cease to be in full force and effect, the Customer
Tranche B Margin shall, from and after such date, be the Customer
Tranche B Margin set forth in ANNEX 1, 2 OR 3, as would otherwise be
applicable in the absence of such ECA Enhancement.
"APPRAISAL" means a report, dated no earlier than fifteen (15) days
prior to the date of its delivery to AEF, prepared by the Appraiser,
in form and substance satisfactory to AEF, as to the matters set forth
in Section 4.02(a).
"APPRAISER" means an independent appraiser selected by AEF and
reasonably acceptable to the Customer.
"ASSIGNMENT AND ACCEPTANCE" has the meaning specified in Section
10.06(a).
"ASSIGNMENT AND SECURITY AGREEMENT" means the assignment and security
agreement to be entered into between the Customer, any Affiliate
thereof contemplated by clause (g) of the definition of "Collateral"
and the Security Agent, in form and substance satisfactory to AEF,
whereby the Customer and such Affiliate (if any) grants to the
Security Agent a Lien on the Collateral in accordance with the terms
hereof.
"ASSUMED DISTRESS VALUE" means an amount expressed in Dollars, as
determined by the Appraiser in the Appraisal, representing the assumed
proceeds of a sale realizable from an orderly remarketing of the
Satellite and (if and to the extent included or to be included in the
Collateral) the TTC&M Facilities, under normal market conditions
prevailing at the date of appraisal, following an assumed Event of
Default on the In-Orbit Commissioning Date.
"AVERAGE LIFE" means, with respect to the Tranche B Loan, an amount,
expressed in years, equal to: (a) the sum of the products of each
Tranche B Required Installment Amount multiplied by the number of
years (calculated to one (1) decimal place) from the Conversion Date
to the Tranche B Principal Payment Date on which such Tranche
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B Required Installment Amount is due, DIVIDED BY (b) the aggregate
amount of the Tranche B Loan outstanding as of the Conversion Date.
"BASE CASE" means, as the context may require, any Preliminary Base
Case, the Conversion Base Case or each subsequent base case updated in
accordance with the annual updated Business Plan to be provided
pursuant to Section 6.02(c) if the Customer shall have been determined
to be a Category 2 Customer or a Category 3 Customer.
"BASE DATE" means (a) prior to the Conversion Date, the date of the
latest Base Financial Statements and (b) on and after the Conversion
Date, the date of the latest Conversion Financial Statements.
"BASE FINANCIAL STATEMENTS" has the meaning specified in Section
5.10(a).
"BASLE ACCORD" means the proposals for a risk-based capital framework
described by the Basle Committee on Banking Regulations and
Supervisory Practices in its paper titled "International Convergence
of Capital Measurements and Capital Standards" dated July 1988.
"BREAK FUNDING COSTS" means any amounts required to compensate AEF for
any losses, costs or expenses (including any loss, cost or expense
incurred by reason of the liquidation or re-employment of funds
acquired by AEF to fund or maintain the extensions of credit
represented by any Loan but excluding any loss of profit or margin)
that it incurs and any amounts required by AEF to indemnify the
Lenders for any of the foregoing types of losses, costs or expenses
with respect to the amounts made available to AEF to fund the Loans
and that it incurs, in either case as a result of any unscheduled
prepayment, repayment or acceleration of any Loan on a date that is
not the last day of an Interest Period.
"BUSINESS DAY" means (a) with respect to the provision of notices or
the lapse of any grace or other period, any day (other than a Saturday
or a Sunday) on which commercial banks are generally open for business
in New York City, Luxembourg, London, Paris and The District of
Columbia, (b) in the context of the definition of "Interest Period"
and for purposes of setting the date for the making of a Loan, a day
that is also a day on which dealings in Dollar deposits are carried
out in the London interbank market and (c) with respect to the making
of any payment, any day (other than a Saturday or a Sunday) on which
commercial banks are generally open for business in New York City and
The District of Columbia.
"BUSINESS PLAN" means, as the context may require, the Preliminary
Business Plan, if one has been submitted pursuant to Section 9.01(a),
or, if the Customer shall have been determined to be a Category 2
Customer or Category 3 Customer, the Conversion Business Plan prepared
by the Customer, as in effect from time to time as provided in
accordance with the terms hereof.
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"CAPEX BUDGET" means a plan for capital expenditures to be made by the
Customer Group over the Tranche B Term that a Customer determined to
be a Category 1C Customer may, at its option (but shall not be
obligated to), (a) furnish to AEF under Section 9.02(c)(i) and (b)
update and furnish to AEF within thirty (30) days before the end of
any fiscal year of the Customer to set forth a revised plan for
capital expenditures for the remainder of the Tranche B Term, such
updated plan to be in form and substance satisfactory to AEF.
"CAPITAL LEASE OBLIGATIONS" means all monetary obligations of a Person
under any leasing or similar arrangement that, in accordance with
Generally Accepted Accounting Principles, is classified as a capital
lease.
"CASH EQUIVALENTS" means the following investments, if and to the
extent they are denominated in Acceptable Currencies:
(a) securities issued or fully guaranteed or insured (i)
by the government of a country the short-term
sovereign debt of which is rated at least A-1 by S&P
(or any local affiliate or associated agency
thereof) or P-1 by Moody's (or any local affiliate
or associated agency thereof) and which is a member
of the OECD, or by any agency of any such
government, and backed by the full faith and credit
of such government, or (ii) by the International
Bank for Reconstruction and Development (the World
Bank), in each case having maturities of not more
than twelve (12) months from the date of
acquisition;
(b) certificates of deposit, time deposits, Eurodollar
time deposits, or bankers' acceptances having in
each case a tenor of not more than six (6) months,
issued by any Lender or by any commercial bank
organized under the laws of any country that is a
member of the OECD, and whose short term securities
are rated at least A-1 by S&P (or any local
affiliate or associated agency thereof) or P-1 by
Moody's (or any local affiliate or associated agency
thereof);
(c) commercial paper of an issuer rated either at least
A-1 by S&P (or any local affiliate or associated
agency thereof) or P-1 by Moody's (or any local
affiliate or associated agency thereof), and in
either case having a tenor of not more than three
(3) months; and
(d) repurchase agreements with any financial institution
whose short term securities are rated at least A-1
by S&P (or any local affiliate or associated agency
thereof) or P-1 by Moody's (or any local affiliate
or associated agency thereof), fully collateralized
by securities issued or fully guaranteed or insured
by the government of a country the short-term
sovereign debt of which is rated at least A-1 by S&P
(or any local affiliate or associated agency
thereof) or P-1 by Moody's (or any local affiliate
or associated agency thereof) and which is a member
of the
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OECD, or by any agency of any such government, and
backed by the full faith and credit of such
government.
"CATEGORY 1 CUSTOMER" means the Customer, if the Customer has
satisfied the requirements of ANNEX 1, as determined by AEF pursuant
to Section 9.02(e), and to which the terms set forth in ANNEX 1,
together with the other terms herein applicable to it, shall apply
during the Tranche B Term.
"CATEGORY 1A CUSTOMER" means a Category 1 Customer that has been
assigned to the 1A subcategory of Category 1 pursuant to Section
9.02(e).
"CATEGORY 1B CUSTOMER" means a Category 1 Customer that has been
assigned to the 1B subcategory of Category 1 pursuant to Section
9.02(e).
"CATEGORY 1C CUSTOMER" means a Category 1 Customer that has been
assigned to the 1C subcategory of Category 1 pursuant to Section
9.02(e).
"CATEGORY 1C QL LOAN LIFE COVER RATIO" means the ratio, calculated as
of the Conversion Date (and, subject to Section 7.13(b), at no other
time) of (a) the aggregate of (i) the net present value (at a discount
rate reasonably acceptable to AEF) of the aggregate QL Cash Flow for
the Tranche B Term, LESS (ii) interest (at a rate reasonably
acceptable to AEF) payable during the Tranche B Term on Indebtedness
secured (or entitled to be secured) by a Lien on any of the Collateral
and scheduled to be outstanding after the Tranche B Term, PLUS (iii)
the aggregate total of any funds placed in escrow pursuant to Section
11.09(a) hereof to (b) the aggregate of (i) the principal amount of
the Tranche B Loan then outstanding, PLUS (ii) any other Indebtedness
then outstanding secured (or entitled to be secured) by a Lien on any
of the Collateral and scheduled to be repaid during the Tranche B
Term.
"CATEGORY 2 CF LOAN LIFE COVER RATIO" means, as of the date of
calculation, the ratio, calculated as of such date under the
Conversion Base Case or, for purposes of Section 12.04(b)(iv), the
Base Case as updated from time to time to reflect the updated Business
Plan furnished under Section 6.02(c)(ii), of (a) the aggregate of (i)
the net present value of Total Cash Flow for the remaining Tranche B
Term (at a discount rate reasonably acceptable to AEF, taking into
account the Rate Contracts entered into in accordance with Section
6.15), LESS (ii) interest (at a rate reasonably acceptable to AEF,
taking into account the Rate Contracts entered into in accordance with
Section 6.15) payable during such year and each subsequent year during
the then remaining Tranche B Term on (A) Indebtedness secured (or
entitled to be secured) by a Lien on any of the Collateral and (B) the
principal amount of all other Indebtedness (other than Subordinated
Indebtedness and (to the extent agreed by AEF) Contingent Obligations)
of the Customer then outstanding, and, in each case, scheduled to be
outstanding after the Tranche B Term, PLUS (iii) the aggregate total
of any funds placed in escrow pursuant to Section 12.03(a) to (b) the
sum (without duplication) of (i) the then outstanding principal amount
of the Tranche B Loan, PLUS (ii) the principal amount of any
Indebtedness then outstanding and secured (or entitled to be secured)
by a Lien on any of the Collateral and scheduled to be repaid during
the
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Tranche B Term, PLUS (iii) the principal amount of all other
Indebtedness (other than Subordinated Indebtedness and (to the extent
agreed by AEF) Contingent Obligations) of the Customer then
outstanding and scheduled to be repaid during the Tranche B Term.
"CATEGORY 2 CUSTOMER" means the Customer, if the Customer has
satisfied the requirements of ANNEX 2, as determined by AEF pursuant
to Section 9.02(e), and to which the terms set forth in ANNEX 2,
together with the other terms herein applicable to it, shall apply
during the Tranche B Term.
"CATEGORY 2 QL LOAN LIFE COVER RATIO" means the ratio, calculated as
of the Conversion Date (and, subject to Section 7.13(b), at no other
time) under the Conversion Base Case, prospectively for each year
during the Tranche B Term, of (a) the aggregate of (i) the net present
value (at a discount rate equal to the debt interest rate used in the
preparation of the Conversion Base Case) of the QL Cash Flow for such
year and each such subsequent year during the then remaining Tranche B
Term, LESS (ii) interest (at a rate equal to the debt interest rate
used in the preparation of the Conversion Base Case) payable during
such year and each such subsequent year during the then remaining
Tranche B Term on Indebtedness secured (or entitled to be secured) by
a Lien on any of the Collateral and scheduled to be outstanding after
the Tranche B Term, PLUS (iii) the aggregate total of any funds placed
in escrow pursuant to Section 12.03(a), to (b) the aggregate of (i)
the principal amount of the Tranche B Loan then outstanding, PLUS (ii)
any other Indebtedness then outstanding and secured (or entitled to be
secured) by a Lien on any of the Collateral and scheduled to be
outstanding at the beginning of such year and each such subsequent
year and scheduled to be repaid during the Tranche B Term.
"CATEGORY 3 CUSTOMER" means the customer, if the Customer has
satisfied the requirements of ANNEX 3, as determined by AEF pursuant
to Section 9.02(e), and to which the terms set forth in ANNEX 3,
together with the other terms herein applicable to it, shall apply
during the Tranche B Term.
"CATEGORY 3 LOAN LIFE COVER RATIO" means the ratio, calculated as of
the Conversion Date (and, subject to Section 7.13(b), at no other
time) under the Conversion Base Case, prospectively for each year
during the Tranche B Term, of (a) the aggregate of (i) the net present
value (at a discount rate equal to the debt interest rate used in the
preparation of the Conversion Base Case) of Total Cash Flow for such
year and each such subsequent year during the then remaining Tranche B
Term, LESS (ii) interest (at a rate equal to the debt interest rate
used in preparation of the Conversion Base Case) payable for such year
and each such subsequent year during the then remaining Tranche B Term
on Indebtedness secured (or entitled to be secured) by a Lien on any
of the Collateral and scheduled to be outstanding after the Tranche B
Term, to (b) the sum (without duplication) of (i) the then outstanding
principal amount of the Tranche B Loan, PLUS (ii) the principal amount
of any Indebtedness then outstanding and secured (or entitled to be
secured) by a Lien on any of the Collateral and scheduled to be repaid
during the Tranche B Term, PLUS (iii) the principal amount of all
other Indebtedness (other than Subordinated Indebtedness and
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(to the extent agreed by AEF) Contingent Obligations) of the Customer
then outstanding and scheduled to be repaid during the Tranche B Term.
"CATEGORY 3 PREVIEW" means the preview process described in Section
9.01.
"C-BAND TRANSPONDERS" means transponders operating in the portion of
the radio-frequency spectrum that covers approximately 4 gigahertz to
8 gigahertz.
"CLA I" means the Arianespace Customer Loan Agreement of even date
herewith between CD Radio Inc. and AEF, providing for the financing of
launch costs under the Launch Services Agreement with respect to
"Launch # 1" as such term is defined in paragraph 6.1 of the Launch
Services Agreement.
"CLOSING DATE" means the date on which all conditions precedent set
forth in Section 4.01 are satisfied by the Customer or waived by AEF
as evidenced by a certificate to such effect executed and delivered by
AEF to the Customer.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COLLATERAL" means all right, title and interest in and to:
(a) the Satellite;
(b) the Satellite Purchase Agreement;
(c) the TTC&M Facilities, if at any time owned by the
Customer, or otherwise, the TTC&M Contract;
(d) any Government Approval relating to the Satellite,
and any other Government Approval relating to any
other part of the Project owned by the Customer, but
excluding any such Government Approval relating
solely to the construction of any portion of the
Project if such construction has been fully
completed;
(e) any intangible rights necessary to control, operate
and transfer ownership of the Satellite;
(f) the benefits of any indemnity, warranty or guarantee
in respect of the Satellite, the TTC&M Facilities or
the assets referred to in (g) below (but only if and
to the extent that the Project Financing is also
secured by a Lien on such assets);
(g) gateway, ground reception and similar facilities
owned by the Customer or any Affiliate thereof or
leasehold interests in such facilities leased by the
Customer or any Affiliate thereof, each to the
extent related to the Satellite where the Project
Financing is also secured by a Lien on such
gateways, ground reception and similar facilities,
and if, at any time
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<PAGE> 13
after the date hereof, (i) the Customer or any
Affiliate thereof acquires title to any of the
foregoing items or (ii) any of the foregoing items
becomes subject to a Lien for the benefit of the
Project Lenders pursuant to any Project Financing,
such items shall thereupon form part of the
Collateral (it being understood and agreed that
until such time, if any, as either of the conditions
referred to in the foregoing subclauses (i) and (ii)
of this clause (g) is satisfied, the items referred
to in this paragraph (g) shall not be deemed to be
Collateral for purposes of this Agreement);
(h) if the Customer shall have been determined to be a
Category 1C Customer or a Category 2 Customer, the
Qualified Lease Agreements;
(i) if the Customer shall have been determined to be a
Category 1C Customer or Category 2 Customer, the
Transponder Lease Agreements (other than Qualified
Lease Agreements), PROVIDED that the Customer shall
not be in breach of its obligations under this
Agreement to the extent that the Customer has
diligently sought to effect an assignment of such
agreements by eliciting the lessee's consent to such
assignment and is unable to achieve the same;
(j) if the Customer shall have been determined to be a
Category 3 Customer that is a Leased Satellite
Customer, the Transponder Lease Agreements, PROVIDED
that the Customer shall not be in breach of its
obligations under this Agreement to the extent that
the Customer has diligently sought to effect an
assignment of such agreements by eliciting the
lessee's consent to such assignment and is unable to
achieve the same, PROVIDED that such agreements
constituting at least fifty percent (50%) of
aggregate projected revenues reflected in the
Business Plan shall have been assigned to the
Security Agent with all required consents thereto
obtained;
(k) if the Customer shall have been determined to be a
Category 3 Customer that is not a Leased Satellite
Customer, the Transponder Lease Agreements;
(l) if the Customer shall have been determined to be a
Category 1C Customer, a Category 2 Customer or a
Category 3 Customer, the Revenue Accounts and all
cash balances and investments held therein;
(m) in relation to a Customer offering an equity pledge
in accordance with Section 9.04(c)(i), one hundred
percent (100%) of its stock certificates or other
equity interests in such Customer or the special
purpose vehicle, as the case may be;
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<PAGE> 14
(n) in relation to all Customer Categories, all proceeds
deriving from the above-specified Collateral in
subsections (a) through (m) above, as the same may
be supplemented pursuant to Section 9.03;
(o) rights to receive certain payments under the Launch
Services Agreement provided or to be provided for in
the Multiparty Agreement as a "delegation" under
French law;
(p) the proceeds of insurance maintained pursuant to
Section 6.06 in respect of which the Security Agent
is required by Section 6.06(c) to be named as loss
payee;
(q) any other rights or assets constituting additional
Collateral pursuant to Section 9.03; and
(r) any collateral provided by the Customer or an
Affiliate thereof to secure a loan by AEF to the
Customer or such Affiliate pursuant to another
customer loan agreement, provided that the Customer
or such Affiliate shall have been determined to be
in the same "Customer Category" in such other
customer loan agreement as hereunder.
It is acknowledged and agreed that, solely for purposes of determining
whether the items referred to in the foregoing clauses (f) and (g)
constitute Collateral, the term "Project Financing" as used in said
clauses shall be deemed not to include any financing that is not
secured by any of the items referred to in any of the other clauses of
this definition.
"COLLATERAL DOCUMENTS" means the Assignment and Security Agreement,
the TTC&M Mortgage (if applicable), the Consents to Assignment, and
other documents to be entered into in order that a Lien is granted and
perfected on or in the Collateral in accordance with the terms hereof
and all financing statements, registrations and other filings (or
comparable documents) now or hereafter filed or to be filed in
connection therewith and (without prejudice to the provisos contained
in clauses (i) and (j) of the definition of "Collateral" in this
Section 1.01) any consents required from any Person in connection
therewith.
"COMMITMENT" means, during the Tranche A Term, the Tranche A
Commitment, and, during the Tranche B Term, the Conversion Commitment.
"COMMITMENT FEE" means the fee payable quarterly in arrears by the
Customer to AEF calculated as a percentage per annum of the daily
average unused portion of the Tranche A Commitment Amount for each day
during the preceding quarterly period, in the amount and as set forth
in the Fee Letter.
"COMPARABLE FINANCING TRANSACTION" means the Customer's most recent
long-term, asset-based financing of comparable term, with comparable
security and on comparable conditions funded with debt from
international banks, if such financing
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<PAGE> 15
was entered into not earlier than the date falling two (2) years prior
to the date hereof and not later than the date hereof.
"CONSENTS TO ASSIGNMENT" mean the acknowledgments and consents to
assignment to be given by Lessees of Qualified Lease Agreements in
accordance with the terms hereof.
"CONSOLIDATED NET WORTH" means the aggregate, on any date of
determination, of:
(a) the amount paid up or credited as paid up on the
issued ordinary and preference share capital of the
Customer Group (excluding any Disqualified Capital
Stock); and
(b) the amount standing to the credit of the capital and
revenue reserves of the Customer Group;
but adjusted (to the extent that the following items have not already
been added, deducted or excluded in calculating (a) or (b) above) by:
(i) adding any amount standing to the credit of the
profit and loss account for members of the Customer
Group since the Base Date to the extent the amount
is not attributable to any dividend or other
distribution declared, recommended or made by any
member of the Customer Group (other than to another
member of the Customer Group);
(ii) deducting any amount standing to the debit of the
profit and loss account for members of the Customer
Group since the Base Date;
(iii) deducting the sum of the following: cost of treasury
shares and the book value of all assets that should
be classified as intangibles (without duplication of
deductions in respect of items already deducted in
arriving at surplus and retained earnings) but in
any event including licenses, goodwill, minority
interests, research and development costs,
trademarks, trade names, copyrights and patents and
franchises;
(iv) reflecting any variation in the amount of the
Customer's issued share capital and capital and
revenue reserves after the Base Date; and
(v) reflecting any variation in the interest of the
Customer in any other member of the Customer Group
since the Base Date.
"CONSTRUCTION AND PAYMENT SCHEDULE" means the construction and payment
schedule prepared and certified by a Responsible Officer of the SPA
Party setting forth the specific dates for payments to be made under
the Satellite Purchase Agreement and the TTC&M Contract, and the
maximum amount of each such payment, as such specific dates and
payment amounts may be adjusted pursuant to the terms of the Satellite
Purchase Agreement and the TTC&M Contract (as the case may be).
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<PAGE> 16
"CONSTRUCTIVE TOTAL FAILURE" has the meaning ascribed to that term or
a term substantially similar to such term in the launch and initial
operations insurance or in the in-orbit insurance (whichever is then
in effect) procured or caused to be procured by the Customer as
required by Section 6.06(b).
"CONTINGENT OBLIGATION" means, as applied to any Person, any direct or
indirect liability of that Person with respect to any Indebtedness,
lease, dividend, letter of credit or other obligation (for purposes of
this definition, the "PRIMARY OBLIGATIONS") of another Person (for
purposes of this definition, the "PRIMARY OBLIGOR"), including any
obligation of that Person, whether or not contingent (a) to purchase,
repurchase or otherwise acquire such primary obligations or any
property constituting direct or indirect security therefor, (b) to
advance or provide funds (i) for the payment or discharge of any such
primary obligation or (ii) to maintain working capital or equity
capital of the primary obligor or otherwise to maintain the net worth
or solvency or any balance sheet item, level of income or financial
condition of the primary obligor, (c) to purchase property, securities
or services primarily for the purpose of assuring the owner of any
such primary obligation of the ability of the primary obligor to make
payment of such primary obligation, (d) otherwise to assure or hold
harmless the holder of any such primary obligation against loss in
respect thereof or (e) to purchase or otherwise acquire, or otherwise
to assure a creditor against loss in respect of, any Indebtedness.
For purposes of this definition, the amount of any Contingent
Obligation shall be deemed to be an amount equal to the maximum
reasonably anticipated liability in respect thereof, as reasonably
determined by such Person's independent auditors.
"CONTRACT" means (a) any agreement (whether bilateral, unilateral,
executory or non-executory, and whether a Person entitled to rights
thereunder is so entitled directly or as a third party beneficiary),
including an indenture, lease or license or (b) any deed or other
instrument of conveyance.
"CONVERSION" has the meaning specified in Section 2.01(b).
"CONVERSION AMOUNT" means the amount of Tranche A Outstandings
actually converted to the Tranche B Loan on the Conversion Date, the
aggregate of such amounts not to exceed the Conversion Commitment
Amount.
"CONVERSION BASE CASE" means the Base Case for the Customer as
described in Section 9.02.
"CONVERSION BUSINESS PLAN" means the Business Plan of the Customer
submitted to AEF as described in Section 9.02, which shall be
sufficient to enable AEF to determine whether the applicable
Conversion Conditions will have been satisfied as of the Conversion
Commitment Date in accordance with Section 9.02(e), and containing at
a minimum, and without limitation, the following information with
respect to the Project:
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<PAGE> 17
(a) details of the Project sponsor or Project sponsors,
a general description of the Customer's business and
organization, the then-current equity holdings
therein and general biographical information as to
key management team members;
(b) projections of all capital and operating costs
(including material taxes) and revenues the Project
is projected to generate with sufficient information
(including the details of assumptions underlying
such projections) in each case for AEF and the
Lenders to assess the Project;
(c) a general description of the target market for the
Project, which shall include a statement of the
percentage of such target market that the Customer
proposes to capture;
(d) a technical description of the Project;
(e) an overview of the laws and regulations applicable
to the Project and the status of requisite
governmental approvals for the construction, launch
and operation thereof;
(f) a description of the Collateral that is expected to
be available for the benefit of AEF and the Lenders
and whether a first priority, perfected Lien will
and can be granted and perfected thereon;
(g) a general description of the proposed sources of
finance for the Project, along with a description of
the manner in which such financing will be secured;
(h) a general description of risks material to the core
business of the Project to the extent not otherwise
described in this definition of Conversion Business
Plan or covered by insurance; and
(i) details of underlying economic assumptions and
factors, including inflation, interest and exchange
rates.
"CONVERSION COMMITMENT" means the commitment by AEF to the Customer
issued on the Conversion Commitment Date for the Conversion (or
Reconversion, as the case may be) of the Conversion Commitment Amount
upon the terms and subject to the conditions of this Agreement,
relating to a Launch (or Reflight, as the case may be) to occur on the
then-scheduled date of Launch and extending up to ninety (90) days
after such date (to accommodate possible launch postponements).
"CONVERSION COMMITMENT AMOUNT" means the amount of Tranche A
Outstandings (including Tranche A Loans, the proceeds of which have
been or will be applied to the payment of Finance Costs) that may be
converted to a Tranche B Loan on the Conversion Date, such amount
being equal to the product of the Tranche B Advance Rate and the
Launch Costs (which product in any event shall not exceed an amount
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<PAGE> 18
equal to the lesser of (a) sixty percent (60%) of the Launch Costs and
(b) eighty million Dollars ($80,000,000) less the "Conversion Amount"
as such term is defined in CLA I).
"CONVERSION COMMITMENT DATE" means the date, if any, on which AEF
shall deliver the Conversion Commitment Letter following the
determination set forth in Section 9.02(e).
"CONVERSION COMMITMENT LETTER" means the notice given by AEF to the
Customer on the Conversion Commitment Date, identifying the applicable
Customer Category and setting forth the terms and conditions of the
Conversion Commitment.
"CONVERSION CONDITIONS" means the conditions set forth in Section
4.02.
"CONVERSION DATE" means the date on which Conversion occurs.
"CONVERSION FEE" means the fee payable by the Customer on the
Conversion Date to AEF calculated as a percentage of the Conversion
Amount as set forth in the Fee Letter.
"CONVERSION FINANCIAL STATEMENTS" has the meaning specified in Section
5.10(b).
"CONVERSION REQUEST DATE" means the date that the Customer delivers to
AEF the items referred to in Section 9.02(d).
"CONVERT" means the occurrence of Conversion with respect to the
Tranche A Loans.
"COVERED PERSON" has the meaning specified in Section 10.04(b).
"COVERED PROPERTY" has the meaning specified in Section 6.06(a).
"COVERED TAXES" has the meaning specified in Section 3.01(d).
"CREDIT RATING" means, at any time, the credit rating most recently
established by a Major Rating Agency for the Customer's Relevant Debt
(as defined in the following sentence). For purposes of the preceding
sentence, "CUSTOMER'S RELEVANT DEBT" means money borrowed by the
Customer (a) the repayment of which is secured by, and only by, a
satellite comparable to the Satellite (including in respect of the
intended use of the Satellite) and other collateral comparable to the
Collateral, and is not supported by any other type of
credit-enhancement, (b) on terms and conditions comparable to the
terms and conditions of this Agreement, the Note and the Collateral
Documents that are applicable after the Conversion Date and (c) where
the ratio of (i) the amount, as reasonably determined by a qualified
appraiser in a written appraisal prepared prior to the establishment
of such credit rating, representing the assumed proceeds of a sale
realizable from an orderly remarketing of such satellite under normal
market conditions prevailing at the date of appraisal to (ii) all
Indebtedness of the Customer secured by a Lien on such satellite on
the date of the establishment of
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<PAGE> 19
such credit rating does not exceed the ratio of (x) the Assumed
Distress Value to (y) Total Senior Debt Outstanding on the date of the
establishment of such Credit Rating; provided that if no such borrowed
money of the Customer exists, "CUSTOMER'S RELEVANT DEBT" means the
Customer's senior, long-term debt that is not secured or otherwise
credit-enhanced, if any.
"CURRENCY OF OBLIGATION" has the meaning specified in Section
10.07(a).
"CURRENCY OF PAYMENT" has the meaning specified in Section 10.07(a).
"CUSTOMER" has the meaning specified in the preamble to this
Agreement.
"CUSTOMER CATEGORY" means the category designated for the Customer
with respect to this Agreement by AEF on the Conversion Commitment
Date pursuant to Section 9.02(e) and in accordance with the criteria
set forth in the Annexes attached hereto.
"CUSTOMER GROUP" means the Customer and, if the Customer shall have
been determined to be a Category 1 Customer, the consolidated
Subsidiaries of the Customer. All financial calculations hereunder to
be made for the Customer Group shall, if the Customer shall have been
determined to be a Category 1 Customer, be made on a consolidated
basis in accordance with Generally Accepted Accounting Principles.
"DECONVERSION" has the meaning specified in Section 2.04(a).
"DEFAULT" means any event which, with the giving of notice or the
lapse of time or both of the foregoing, would constitute an Event of
Default.
"DEFAULT RATE" has the meaning specified in Section 2.07(c)(ii).
"DETERMINATION" has the meaning specified in Section 10.19.
"DISQUALIFIED CAPITAL STOCK" means capital stock of the Customer that
may be redeemed, purchased or repurchased, or in respect of which
sinking fund payments may be made, other than solely at the option of
the Customer.
"DISTRESS RECOVERY VALUE" means the product of the Assumed Distress
Value multiplied by the ratio of the Conversion Amount to the Total
Senior Debt Outstanding as of the Conversion Date.
"DOLLARS" and "$" means lawful money of the United States of America.
"DOMICILED" with respect to any Person means each jurisdiction:
(a) in which such Person is incorporated or organized;
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<PAGE> 20
(b) that is the primary jurisdiction in which such
Person is domiciled for the purposes of calculating
corporation or other taxes on its revenues or
capital; or
(c) in which, in accordance with the determination of
any Lender, consistently applied, pursuant to the
policies or any decision of a Governmental Authority
or any court having jurisdiction over such Lender,
or another authority with which such Lender
customarily complies, such Person is domiciled.
"EBITDA" ("earnings before interest, tax, depreciation and
amortization") means, for any period, the net income or net loss (or
the equivalent) for the Customer Group for such period, determined in
accordance with Generally Accepted Accounting Principles as follows
(without duplication), using items reflected in the financial
statements of the Customer Group, to the extent applicable:
(a) after adding back (to the extent otherwise deducted)
any depreciation and amortization;
(b) after adding back (if negative and to the extent
otherwise deducted) or after deducting (if positive
and to the extent otherwise added) any extraordinary
items, including without limitation those that would
be treated as "exceptional items" under generally
accepted accounting principles in the United Kingdom
in cases where such generally accepted accounting
principles are the Specified GAAP for purposes
hereof;
(c) after adding back (to the extent otherwise deducted)
corporate taxes and the equivalents in any relevant
jurisdiction;
(d) after adding back (if negative and to the extent
otherwise deducted) or after deducting (if positive
and to the extent otherwise added) interest expense
and interest income, whether or not paid, deferred
or capitalized;
(e) before taking into account, to the extent not
received by the Customer Group in cash during such
period, any income of the Customer Group from any
Affiliate or other investments (or any such income
accrued in respect of any prior period which has not
previously been paid), and before taking into
account, to the extent not received by the Customer
Group in cash during such period, any share of the
profit of any Affiliate or other investments and
after taking into account dividends received in cash
during such period from any Affiliate or other
investments;
(f) after adding back (to the extent otherwise deducted)
the amount of pension contributions and vacation and
health benefits provided by the
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<PAGE> 21
Customer Group in respect of such period but not
paid in cash, to the extent only that they are not
actually paid in cash (and, for this purpose, if
such amount for any annual accounting period is not
allocated on the basis of quarterly accounting
periods, it shall be deemed allocated equally to
each of the four (4) quarters comprised in such
annual accounting period);
(g) if the Customer shall have been determined to be a
Category 1C Customer, after deducting (to the extent
otherwise included) any gain over book value arising
in favor of the Customer Group on the sale, lease or
other disposal of any asset (other than the sale of
trading stock) during such period and any gain
arising on any revaluation of any asset during such
period;
(h) after adding back (to the extent otherwise deducted)
any loss against book value incurred by the Customer
Group on the sale, lease or other disposal of any
asset (other than the sale of trading stock) during
such period, or any loss on any revaluation of any
asset during such period; and
(i) if the Customer shall have been determined to be a
Category 1 Customer, after deducting (to the extent
otherwise included) the amount of profit (or adding
back the amount of any loss) of the Customer Group
for such period which is attributable to minority
interests in any Subsidiary of the Customer.
"ECA" means any one or more than one export credit agency as AEF may
approve that, at the request of the Customer, AEF, AE or any Lender,
provides ECA Country Risk Coverage or ECA Enhancement.
"ECA COUNTRY RISK COVERAGE" means political risk coverage, in
accordance with the statutory limitations in effect on the date hereof
on such coverage (together with changes thereto as may be acceptable
to AEF) available from the applicable ECA in an amount and on terms
and conditions satisfactory to AEF, provided by one or more ECAs in
support of the Tranche B Loan.
"ECA ENHANCEMENT" means commercial risk coverage, in accordance with
the statutory limitations in effect on the date hereof on such
coverage (together with changes thereto as may be acceptable to AEF)
available from the applicable ECA in an amount and on terms and
conditions satisfactory to AEF, provided by one or more ECAs in
support of the Tranche B Loan.
"ECA GUARANTY FEE" means the fees payable by the Customer to AEF or
any ECA in connection with ECA Country Risk Coverage or ECA
Enhancement as advised by the relevant ECAs.
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<PAGE> 22
"ECA PERCENTAGE" means the percentage of the Tranche B Loan guaranteed
by ECA Enhancement, expressed as a percentage of the aggregate total
amount of the Tranche B Loan then outstanding.
"ECU" means the European Currency Unit being the unit of account used
by the European Monetary System, the composition of which may from
time to time be varied by the European Union.
"ELIGIBLE ASSIGNEE" means (a) any Lender for itself or on behalf of
any other Lender or Lenders or AEF, (b) a Subsidiary of any Person
described in clause (a) above (for purposes of this definition, such
Person being herein referred to as a "PERMITTED INSTITUTION") if such
Permitted Institution enters into a legal, valid, binding and
enforceable written guaranty, providing that such Permitted
Institution shall be primarily and unconditionally liable to the
Customer for all obligations of its Subsidiary, (c) any Affiliate of
AEF or (d) any private or public holder or holders of any Indebtedness
of AEF pursuant to any private or public offering or any trustee or
institution acting on their behalf.
"ENVIRONMENTAL CLAIM" means all claims, however asserted, by any
Governmental Authority or other Person alleging potential liability or
responsibility for violation of any Environmental Law or for release
or injury to the environment or threat to public health, personal
injury (including sickness, disease or death), property damage,
natural resources damage or otherwise alleging liability or
responsibility for damage (punitive or otherwise), cleanup, removal,
remedial or response costs, restitution, civil or criminal penalties,
injunctive relief or other type of relief, resulting from or based
upon (a) the presence, placement, discharge, emission or release
(including intentional and unintentional, negligent and non-negligent,
sudden or non-sudden, accidental or non-accidental placement, spills,
leaks, discharges, emissions or releases) of any Hazardous Material
at, in or from property, whether or not owned by the Customer or (b)
any other circumstances forming the basis of any violation, or alleged
violation, of any Environmental Law.
"ENVIRONMENTAL LAWS" means all national, local or foreign laws,
statutes, common law duties, rules, regulations, ordinances and codes,
together with all administrative orders, directed duties, requests,
licenses, authorizations and permits of, and agreements with, any
Governmental Authorities that are binding on, or are customarily
complied with by, the Customer, in each case relating to environment,
health and safety.
"ENVIRONMENTAL PERMITS" has the meaning specified in Section 5.11.
"EQUIPMENT COST" means the aggregate of the costs for the construction
and launch of the Satellite, the insurance procured and maintained for
the Satellite and the construction of the TTC&M Facilities.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
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<PAGE> 23
"ERISA AFFILIATE" means any Person that for purposes of Title IV of
ERISA is a member of the controlled group of the Customer, or under
common control with the Customer, within the meaning of Section 414 of
the Code.
"EURO" means the unit of currency used or to be used in the European
monetary system following implementation of the European monetary
union.
"EVENT OF DEFAULT" means any of the events specified in Section 8.01.
"EVENT OF LOSS" means, with respect to the Satellite, any loss of,
destruction of or damage to the Satellite resulting in a failure to
achieve its performance specifications and meet its intended purpose,
any condemnation, seizure or taking, by exercise of the power of
eminent domain by any Governmental Authority or other Person, thereof
or the requisition of the use thereof pursuant to any final judgment,
order, decree or proclamation remaining unvacated, undischarged,
unstayed or unbonded pending appeal for a period of ninety (90) days
after the entry thereof, in all events including any Total Failure,
Constructive Total Failure or Partial Failure.
"EXCESS CASH FLOW" means, for any period, the excess of (a) the sum of
(i) EBITDA for such period and (ii) the decrease, if any, in Non-Cash
Working Capital during such period, over (b) the sum of (i) Total
Interest for such period, (ii) income taxes of the Customer Group paid
in cash during such period, (iii) capital expenditures of the Customer
Group during such period, (iv) scheduled payments of principal of
Indebtedness made by any member of the Customer Group during such
period other than payments of Indebtedness owing to any member of the
Customer Group, (v) voluntary prepayments of principal of the Tranche
B Loan made during such period pursuant to Section 2.05(a) and (vi)
the increase, if any, in Non-Cash Working Capital during such period.
"EXPERT STUDIES" means technical, feasibility and marketing studies,
prepared in respect of a Customer that may be or has been determined
to be a Category 3 Customer, dated no earlier than fifteen (15) days
prior to the date of delivery thereof to AEF, if appropriate to the
Business Plan and required pursuant to the applicable Conversion
Conditions, in form and substance acceptable to AEF, prepared by an
expert or experts selected by AEF and acceptable to the Customer.
"EXPORT LICENSE" means any license required to be granted to the
Customer or the Satellite Manufacturer, by the government of the
country of manufacture of the Satellite and the country of any
component thereof or any other asset necessary to the Project
requiring an export license, approving the export of the Satellite and
any such component or asset.
"FAIR MARKET VALUE" means the cash price in Dollars that would be
obtained for the Satellite (together with the launch services for the
Satellite, the supply of tracking, telemetry, control and monitoring
facilities, and related insurance), in an arm's length sale
transaction between an informed and willing seller and an informed and
willing purchaser or user, each unrelated to the Customer or any
Affiliate thereof and under
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<PAGE> 24
no compulsion to effectuate the transaction and each having knowledge
of all relevant facts, as determined by the Appraiser in the
Appraisal.
"FEE LETTER" means the letter dated as of the date hereof by AEF and
acknowledged and agreed to by the Customer, specifying the fees
referred to therein, as described in Section 2.08, and the Applicable
Margin during the Tranche A Term.
"FINANCE COSTS" means any one or more of, as determined by AEF, the
ECA Guaranty Fee, the Upfront Fee and interest on the Tranche A Loans,
in each case, to the extent capitalized pursuant to Section 2.07(d),
as permitted by AEF.
"FUNDED DEBT" means, for any Person, Indebtedness of such Person
having a final maturity date more than one (1) year after the date of
issuance, incurrence or assumption thereof by such Person, including
the current portion of any such Indebtedness and including
Indebtedness that is renewable or extendable, at the option of the
obligor, to a date more than one (1) year after the date of issuance,
incurrence or assumption thereof.
"FUNDING-RELATED TAXES" has the meaning specified in Section 3.01(c).
"GENERALLY ACCEPTED ACCOUNTING PRINCIPLES" means (a) at any time prior
to the Conversion Date (for all purposes hereof other than a Category
3 Preview, the determination of whether the Customer is to be a
Category 1A Customer, a Category 1B Customer, a Category 1C Customer,
a Category 2 Customer or a Category 3 Customer, and the establishment
of Conversion Conditions), generally accepted accounting principles in
effect at such time in a jurisdiction in respect of which an
internationally recognized independent public accounting firm has
furnished an opinion (containing solely qualifications acceptable to
AEF) in connection with its auditing of the Customer's financial
statements, (b) at any time on or after the Conversion Date (solely
for the purpose of defining the preparation and presentation of
financial statements to be delivered under Section 6.01), generally
accepted accounting principles in effect at such time in a country
listed in ANNEX 4 hereto or (c) at all times and for all purposes not
covered by the foregoing clauses (a) and (b), Specified GAAP, in each
case referred to in the foregoing clauses (a), (b) and (c),
consistently applied.
"GOVERNMENT APPROVALS" means all Telecommunications Approvals, all
Export Licenses, all foreign exchange control approvals, all
Environmental Permits and any other authorizations, consents,
approvals, licenses, rulings, permits, certifications, exemptions,
filings or registrations by or with any Telecommunications Authority
or other Governmental Authority required by applicable Requirements of
Law to be obtained or held by the Customer in connection with (a) the
due execution, delivery and performance by the Customer of its
obligations, and the exercise of its rights, under the Loan Documents,
the Satellite Contracts and any other agreement or instrument entered
into from time to time relating to the Project, (b) the construction
and completion of the Project and operation of the Project as
contemplated by the Satellite Contracts and, if applicable, the
Business Plan, (c) the export of the Satellite
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<PAGE> 25
or any of its components and (d) the grant of the Liens created by the
Collateral Documents and the validity, enforceability and perfection
thereof and the exercise by the Security Agent of its rights and
remedies thereunder.
"GOVERNMENTAL AUTHORITY" means any international body or any nation or
government, any state or other political subdivision thereof, any
central bank (or similar monetary or regulatory authority) thereof,
any entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government and any
corporation or other entity owned or controlled, through stock or
capital ownership or otherwise, by any of the foregoing.
"GUARANTOR" or "GUARANTORS" has the meaning specified in ANNEX 1
hereto.
"HAZARDOUS MATERIAL" means all those substances that are regulated by,
or which may form the basis of liability under, any Environmental Law,
including all substances identified under any Environmental Law as a
pollutant, contaminant, waste, solid waste, hazardous waste, hazardous
constituent, special waste, hazardous substance, hazardous material or
toxic substance, or petroleum or petroleum derived substance or waste.
"INDEBTEDNESS" means, without duplication, any indebtedness of any
Person for or in respect of:
(a) borrowed money and any other amount raised under any
other transaction having the commercial effect of
borrowing;
(b) the amount of any liability in respect of the
purchase price for any assets or services, the
payment of which is deferred (including any deferred
amount payable under the Satellite Contracts);
(c) all reimbursement obligations with respect to surety
bonds, letters of credit, bankers' acceptances and
similar instruments (in each case, whether or not
matured);
(d) all obligations evidenced by notes, bonds,
debentures or similar instruments, including
obligations so evidenced incurred in connection with
the acquisition of property, assets or businesses;
(e) all indebtedness created or arising under any
conditional sale or other title retention agreement,
or incurred as financing, in either case with
respect to property acquired by the Person (even
though the rights and remedies of the seller or bank
under such agreement in the event of a default are
limited to repossession or sale of such property);
(f) all Capital Lease Obligations;
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(g) the aggregate amount that would be payable by such
Person under all Rate Contracts to which it is a
party if such Rate Contracts were terminated at the
time of determination minus (to the extent such
aggregate amount is subject to reduction pursuant to
valid and enforceable netting arrangements (either
within such Rate Contracts or in separate
agreements) with the respective counterparties) the
amounts payable by the respective counterparties
under such Rate Contracts upon such termination at
such time;
(h) indebtedness created pursuant to leveraged lease or
sale and leaseback financings intended to be repaid
from the rentals payable by the Person under such
leveraged lease or sale and leaseback financing;
(i) all Contingent Obligations;
(j) any lease which, in accordance with any applicable
tax law, is classified as a loan or finance lease;
and
(k) all Indebtedness referred to in clauses (a) through
(k) above secured by (or for which the holder of
such Indebtedness has an existing right, contingent
or otherwise, to be secured by) any Lien upon or in
property (including accounts and contract rights)
owned by such Person, even though such Person has
not assumed or become liable for the payment of such
Indebtedness.
In calculating the amount of any Indebtedness for all purposes hereof,
there shall be excluded any amount thereof that has been irrevocably
and unconditionally defeased by the deposit of cash or securities with
the holder or holders, or an agent or trustee for the holder or
holders, of such Indebtedness in accordance with the indenture, lease
or other agreement governing the terms and conditions of such
Indebtedness.
"IN-ORBIT COMMISSIONING DATE" means the date on which initial in-orbit
tests on the Satellite have been successfully completed and the
Satellite enters commercial service, as evidenced by a certificate of
a Responsible Officer of the SPA Party bearing such date and
certifying that the results of the initial in-orbit tests either (a)
comply with the required Satellite performance specifications as set
forth in the Satellite Purchase Agreement or (b) are otherwise
acceptable to the SPA Party.
"INSOLVENCY PROCEEDING" means, with respect to any Person (a) any
case, action, petition or proceeding before any court relating to
bankruptcy, reorganization, insolvency, liquidation, receivership,
dissolution, winding-up or relief of debtors or similar proceeding; or
(b) any general assignment for the benefit of creditors, composition,
marshalling of assets for creditors or other similar arrangement,
which in each case shall include any analogous proceeding or
arrangement under the laws of the jurisdiction in which such Person is
incorporated or any jurisdiction in which such Person carries on
business that is recognized by a Governmental Authority of competent
jurisdiction in the jurisdiction of incorporation of such Person.
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"INSURED PARTIES" means AEF, the Security Agent, the Lenders, the
Project Agent and the Project Lenders.
"INTERCREDITOR AGREEMENT" means, if applicable, the Intercreditor
Agreement to be negotiated in good faith and entered into on the date
specified in Section 2.11 among AEF, the Lenders (or an agent acting
on their behalf), the Project Agent (on behalf of the Project
Lenders), the Security Agent and the applicable ECAs (if relevant),
providing for, among other things, the sharing among such parties of
the Liens on the Collateral and the proceeds thereof.
"INTEREST BASIS" means, with respect to any Loan or unpaid amount for
any specified period:
(a) the rate of interest per annum that appears on page
3750 or any successor page of the Telerate screen
which displays British Bankers Association
Settlement Rates for deposits in Dollars, of the
offered quotation for deposits in Dollars for such
specified period, without rounding, at or about
11:00 a.m. (London time) on the Quotation Date; or
(b) if the rate described in clause (a) does not so
appear, the rate per annum at which Dollar deposits
are offered in the London interbank market at such
time for such specified period as evidenced on
another financial information service publishing
such rates as agreed by the Customer and AEF; or
(c) if the rates described in clauses (a) and (b) above
do not appear (including, in the case of said clause
(b), by reason of the Customer and AEF failing to
agree on an alternative financial information
service), the arithmetic mean (rounded upwards, if
not already such a multiple, to the nearest whole
multiple of one-sixteenth of one percent (1/16%)) of
the rates (as notified to AEF) at which each of the
Reference Banks was offering to prime banks in the
London interbank market deposits in Dollars for the
specified period at or about 11:00 a.m. (London
time) on the Quotation Date for such specified
period.
For the purposes of this definition "specified period" shall mean the
Interest Period of such Loan or, as the case may be, the period in
respect of which the Interest Basis falls to be determined in relation
to such unpaid amount.
"INTEREST PAYMENT DATE" has the meaning specified in Section 2.07(b).
"INTEREST PERIOD" means, with respect to any Loan, (a) the three (3)
month period commencing on the Business Day such Loan is disbursed and
each three (3) month period thereafter ending on the Interest Payment
Date of the final whole three (3) month period immediately preceding
the Conversion Commitment Date, (b) the one (1) month period
commencing on the Interest Payment Date immediately
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preceding the Conversion Commitment Date and each one (1) month period
thereafter ending on the Interest Payment Date immediately following
the In-Orbit Commissioning Date, and (c) the period from the end of
the immediately preceding one (1) month period to the date that is
three (3) months after the In-Orbit Commissioning Date and each three
(3) month period thereafter ending on the date that such Loan is
repaid or prepaid in full, in each case, subject to the following:
(i) any Interest Period that would otherwise end on a
day that is not a Business Day shall be extended to
the next succeeding Business Day unless the result
of such extension would be to carry such Interest
Period into another calendar month, in which event
such Interest Period shall end on the immediately
preceding Business Day;
(ii) any Interest Period that begins on the last Business
Day of a calendar month (or on a day for which there
is no numerically corresponding day in the calendar
month at the end of such Interest Period) shall end
on the last Business Day of the calendar month at
the end of such Interest Period;
(iii) if any Interest Period would otherwise end after any
Tranche B Principal Payment Date, such Interest
Period shall end on such Tranche B Principal Payment
Date; and
(iv) if a new Loan is disbursed on a day that falls
during an Interest Period for another Loan, the
first Interest Period for such new Loan shall end on
the last day of the Interest Period for such other
Loan.
"ITU" means the International Telecommunication Union, or any
successor agency thereto.
"KU-BAND TRANSPONDERS" means transponders operating in the portion of
the radio-frequency spectrum that covers approximately 12 gigahertz
to 18 gigahertz.
"L" means, as of any date of determination, the then-scheduled date of
Launch as determined pursuant to the Launch Services Agreement or, if
the Launch is then so scheduled to occur on an unspecified date during
a period that includes more than one day, the first day of such
period.
"LAUNCH" means "Launch # 2", as such term is defined in paragraph 6.1
of the Launch Services Agreement.
"LAUNCH COSTS" means all amounts payable by the LSA Party to AE for
launch and related services in respect of the Satellite pursuant to
the terms of the Launch Services Agreement.
"LAUNCH FAILURE" has the meaning ascribed to that term in the Launch
Services Agreement.
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<PAGE> 29
"LAUNCH SERVICES AGREEMENT" means that certain agreement, dated July
22, 1997, between AE and the LSA Party, and any attachments related
thereto, for the launching into orbit of the Satellite by a Launch
Vehicle.
"LAUNCH SERVICES PRICE" means the reference price used to calculate
progress payments to AE for launch and associated services in respect
of the Satellite, as agreed on the date of the execution and delivery
of the Launch Services Agreement and provided for therein.
"LAUNCH VEHICLE" means the vehicle belonging to the Ariane family
(Ariane 4 or Ariane 5) chosen to perform the Launch.
"LEASED SATELLITE CUSTOMER" means any Category 3 Customer whose
Project involves one or more geostationary communications satellites
with ninety percent (90%) or more of the total bandwidth capacity
thereon comprising C-Band Transponders, Ku-Band Transponders or a
combination thereof being intended, pursuant to its Business Plan, to
be leased to commercial companies or governmental agencies for
communications services or broadcasting services.
"LENDERS" means the Persons providing financing to AEF for the purpose
of funding the Loans to the Customer, including any agent appointed by
such Persons to act for and on behalf of them.
"LENDING OFFICE" means, with respect to any Lender, the office or
offices of such Lender as it may from time to time specify to AEF as
such.
"LESSEE" means the party (other than the Customer) to any Qualified
Lease Agreement, which party (a) either (i) shall be a governmental or
inter-governmental agency, or a bona fide third party commercial
customer, in each case with a long-term senior unsecured debt credit
rating of at least Baa3 by Moody's or BBB- by S&P (or the equivalent
rating by another Major Rating Agency) or (ii) shall be a Person
acceptable to AEF following its good faith assessment of the risks
associated with such Person's ability to fulfill its obligations under
such Qualified Lease Agreement, (b) neither AEF nor any Lender would
be prohibited by any applicable Requirement of Law or by a
Governmental Authority with jurisdiction over AEF or such Lender, as
the case may be, or by another authority with which such Lender
customarily complies, from making loans to by reason of such Lessee's
connection with a Prohibited Country and (c) shall not be a Prohibited
Person.
"LICENSED" means the primary jurisdiction in which the Customer
obtained or will obtain its licenses, permits, authorizations and
consents in connection with the operation of the Satellite.
"LIEN" means any mortgage, pledge, hypothecation, assignment, charge
or deposit arrangement, encumbrance, lien (statutory or other) or
preference, priority or other security interest or preferential
arrangement of any kind or nature whatsoever, whether fixed or
floating (whether over present or future revenues or assets and
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<PAGE> 30
including those created by, arising under or evidenced by any
conditional sale or other title retention agreement, the interest of a
lessor under a Capital Lease Obligation, any financing lease having
substantially the same economic effect as any of the foregoing, or the
filing of any financing statement naming the owner of the asset to
which such lien relates as debtor, under any applicable law) and any
contingent or other agreement to provide any of the foregoing.
"LOAN" or "LOANS" means any or all of the Tranche A Loans, the Tranche
B Loans or both.
"LOAN DOCUMENTS" means, collectively, this Agreement, the Note, the
Multiparty Agreement, the Fee Letter, the Collateral Documents and the
Intercreditor Agreement and all executed agreements, instruments and
documents delivered to AEF, AE or by the Customer or any Affiliate of
the Customer in connection herewith and therewith.
"LONG TERM DEBT TO CAPITALIZATION" means the sum for the Customer
Group on the last day of the Relevant Period, determined without
duplication in accordance with Generally Accepted Accounting
Principles, of (a) the aggregate amount of all Funded Debt (excluding,
for purposes of this definition, Contingent Obligations) PLUS (b) the
aggregate amount of all Disqualified Capital Stock (excluding, for
purposes of this definition, any portion thereof that has been
irrevocably and unconditionally defeased by the deposit of cash or
securities with the holder or holders, or an agent or trustee for the
holder or holders, of such Disqualified Capital Stock in accordance
with the instrument governing the terms and conditions of such
Disqualified Capital Stock), such sum to be expressed as a percentage
of the sum on such date for the Customer Group of (i) the aggregate
amount of Funded Debt (excluding, for purposes of this definition,
Contingent Obligations) PLUS (ii) the aggregate amount of all
Disqualified Capital Stock (excluding, for purposes of this
definition, any portion thereof that has been irrevocably and
unconditionally defeased by the deposit of cash or securities with the
holder or holders, or an agent or trustee for the holder or holders,
of such Disqualified Capital Stock in accordance with the instrument
governing the terms and conditions of such Disqualified Capital Stock)
PLUS (iii) Consolidated Net Worth.
"LOSSES" has the meaning specified in Section 10.04(b).
"LSA PARTY" means the party (other than AE) to the Launch Services
Agreement which may be the Customer (or any Affiliate thereof) or the
Satellite Manufacturer (or any Affiliate thereof) if the Satellite is
to be delivered to the Customer in-orbit.
"MAJOR RATING AGENCY" means S&P, Moody's, any other internationally
recognized credit rating agency acceptable to AEF, or any of their
respective local affiliates or associated agencies.
"MATERIAL ADVERSE EFFECT" means a material adverse change in, or a
material adverse effect upon, any of:
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<PAGE> 31
(a) the operation, business, assets or financial
condition of the Customer Group;
(b) the ability of the Customer to perform its
obligations or enforce its rights under any Loan
Document;
(c) the value of the Collateral (including the revenues
to be generated therefrom);
(d) the legality, validity, binding effect or
enforceability of any or all of this Agreement, any
other Loan Document or any of the Satellite
Contracts; or
(e) the perfection or priority of any Lien granted to
the Security Agent or any Lender, as the case may
be, with respect to any Collateral under any of the
Collateral Documents.
"MATERIAL SUBSIDIARY" means, with respect to any Person on any date
(the "DETERMINATION DATE"), any Subsidiary of such Person (each, a
"PRIMARY MATERIAL SUBSIDIARY") that (for the relevant period or date
referred to below) accounted or accounts for ten percent (10%) or more
of any of the following items (each, a "FINANCIAL CATEGORY") for such
Person and its consolidated Subsidiaries: (a) gross revenues for the
period of four (4) fiscal quarters of such Person ending on or most
recently ended prior to the Determination Date, (b) operating profits
for the period of four (4) fiscal quarters of such Person ending on or
most recently ended prior to the Determination Date or (c) gross
assets on the Determination Date; PROVIDED that if the Subsidiaries of
such Person (other than the Primary Material Subsidiaries) that
accounted or account, in the aggregate, for more than twenty percent
(20%) of any of the Financial Categories for such Person and its
consolidated Subsidiaries, then the Material Subsidiaries of such
Person shall also include each Subsidiary of such Person that
accounted or accounts for a higher percentage of a Financial Category
than any other Subsidiary of such Person (excluding Primary Material
Subsidiaries) as at the Determination Date, together with each other
Subsidiary of such Person designated from time to time by AEF,
provided that there shall not be more than five (5) Material
Subsidiaries that are not Primary Material Subsidiaries.
"MATURITY DATE" means the date being the last day of the Tranche B
Term, as set forth in the Conversion Commitment Letter in accordance
with the conditions set forth in ANNEX 1, 2 OR 3, as applicable, which
in no event shall be later than April 14, 2009.
"MAXIMUM TRANCHE B TERM" means the period set forth in ANNEX 1, 2 OR
3, as may be applicable to the Customer on and after the Conversion
Date in relation to the designation by AEF of the Customer into a
Customer Category, which shall end, in any case, no later than the
Maturity Date.
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<PAGE> 32
"MEASURING DATE" means, (a) so long as the Customer shall have been
determined to be a Category 1 Customer or a Category 2 Customer for
which quarterly financial statements are not required to be delivered
pursuant to Section 6.01, the last day of every semi-annual fiscal
period of the Customer for which financial statements are required to
be delivered pursuant to Section 6.01, commencing with the first such
fiscal period-end following the Conversion Date and (b) so long as the
Customer shall have been determined to be a Category 2 Customer for
which quarterly financial statements are required to be delivered
pursuant to Section 6.01 or a Category 3 Customer, the date of the
last day of each fiscal quarter of the Customer, commencing with the
first fiscal quarter-end following the Conversion Date.
"MODELLING LENDER" means a Lender identified by AEF to act pursuant to
Section 9.01(b).
"MOODY'S" means Moody's Investors Service, Inc.
"MULTIPARTY AGREEMENT" means the agreement dated as of the date
hereof, among the Customer, AEF, AE and the LSA Party, relating, among
other things, to payment instructions and reimbursement obligations
among the parties thereto.
"NON-CASH WORKING CAPITAL" means, at any time, (a) accounts receivable
and inventory of the Customer Group at such time MINUS (b) the
accounts payable of the Customer Group at such time.
"NOTE" has the meaning specified in Section 2.12.
"NOTICE OF CONVERSION" means a notice from AEF to the Customer stating
that the Tranche A Loans have Converted to the Tranche B Loan.
"NOTICE OF DRAWDOWN" means a written notice given by the Customer to
AEF, requesting the making of a Tranche A Loan, substantially in the
form of Exhibit A hereto, pursuant to Section 2.02.
"NOTICE OF LIEN" means any "notice of lien" or similar document
intended to be filed or recorded with any court, registry, recorder's
office, central filing office or Governmental Authority for the
purpose of evidencing, creating, perfecting or preserving the priority
of a Lien securing obligations owing to a Governmental Authority.
"OECD" means the Organization for Economic Cooperation and
Development, or any successor agency thereto.
"OTHER INDEBTEDNESS FOR BORROWED MONEY" means Indebtedness of the
Customer and its Subsidiaries that is not a Loan or a Project Loan and
represents Indebtedness for borrowed money.
"OTHER TAXES" has the meaning specified in Section 3.01(b).
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<PAGE> 33
"P&I DEBT SERVICE" means, for any period, the sum of (a) Total
Interest with respect to P&I Indebtedness for such period PLUS (b) the
aggregate amount of principal payments of P&I Indebtedness scheduled
to have been made by the Customer Group during such period.
"P&I INDEBTEDNESS" means, without duplication, the following items for
the Customer Group, determined in accordance with Generally Accepted
Accounting Principles: (a) all indebtedness for borrowed money, (b)
all obligations issued, undertaken or assumed as the deferred purchase
price of capital assets, (c) all obligations evidenced by notes,
bonds, debentures or similar instruments, including obligations so
evidenced incurred in connection with the acquisition of property,
assets or businesses, excluding performance bonds, letters of credit
and similar undertakings in connection with the construction,
development or operation of any business of the Customer Group to the
extent that such undertakings do not secure an obligation for borrowed
money or the deferred purchase price of a capital asset, (d) all
indebtedness created or arising under any conditional sale or other
title retention agreement, or incurred as financing, in either case
with respect to property acquired by the Customer Group (even though
the rights and remedies of the seller or bank under such agreement in
the event of a default are limited to repossession or sale of such
property) and (e) all Indebtedness referred to in clauses (a) through
(d) above (whether or not incurred by the Customer Group) secured by
(or for which the holder of such P&I Indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien upon or in
property (including accounts and contract rights) owned by any member
of the Customer Group even though such member has not assumed or
become liable for the payment of such Indebtedness.
"PARTIAL FAILURE" has the meaning ascribed to that term or a term
substantially similar to such term in the launch and initial
operations insurance the Customer is required to obtain pursuant to
Section 6.06(b) or in the in-orbit insurance the Customer is required
to obtain pursuant to Section 6.06(b), whichever is then in effect.
"PERMITTED INVESTMENTS" has the meaning specified in Section 7.14.
"PERMITTED LIENS" has the meaning specified in Section 7.01.
"PERMITTED LOCATION" means any country listed on ANNEX 6 hereto.
"PERSON" means an individual, partnership, corporation, business
trust, joint stock company, trust, unincorporated association, joint
venture, voluntary organization or Governmental Authority.
"PRELIMINARY BASE CASE" means the Base Case for the Customer as
described in Section 9.01.
"PRELIMINARY BUSINESS PLAN" means the Business Plan of the Customer
submitted to AEF as described in Section 9.01 or submitted to AEF
prior to the execution and delivery of this Agreement, which shall be
in form sufficient to allow the AEF or the
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<PAGE> 34
Lenders to make the determinations contemplated in Section 9.01 and
containing at a minimum, and without limitation, the following
information with respect to the Project:
(a) details of the Project sponsor or Project sponsors,
a general description of the Customer's business and
organization, the then-current equity holdings
therein and, if such information is available,
general biographical information as to key
management team members;
(b) projections of all capital and operating costs
(including material taxes) and revenues the Project
is projected to generate with sufficient information
(including the details of assumptions underlying
such projections) in each case for AEF and the
Lenders to assess the Project;
(c) a general description of the target market for the
Project, which shall include a statement of the
percentage of such target market that the Customer
proposes to capture;
(d) a technical description of the Project;
(e) an overview of the laws and regulations applicable
to the Project and the status of requisite
governmental approvals for the construction, launch
and operation thereof;
(f) if such information is available, a description of
the Collateral that is expected to be available for
the benefit of AEF and the Lenders and whether a
first priority, perfected Lien will and can be
granted and perfected thereon;
(g) a general description of the proposed sources of
finance for the Project, along with a description of
the manner in which such financing will be secured;
and
(h) details of underlying economic assumptions and
factors, including inflation, interest and exchange
rate.
"PRE-TAX CASH INTEREST COVERAGE" means, for any Person, the lower of
(a) the arithmetic mean of the Pre-Tax Cash Interest Coverage
Components for such Person for the three (3) Relevant Sub-Periods and
(b) the Pre-Tax Cash Interest Coverage Component for such Person for
the last Relevant Sub-Period. For purposes of this definition, the
"PRE-TAX CASH INTEREST COVERAGE COMPONENT" for any Person for any
period means the ratio of EBITDA for such period to Total Interest for
such Person for such period.
"PROHIBITED COUNTRY" means, as to any Lender or AEF, any country into
which bank or other financial institution lending activity is
prohibited, declared unlawful or restricted by any authority
(international, national or regional, including any
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<PAGE> 35
regulatory authority, the regulations of which are customarily
complied with by such Lender or AEF), having jurisdiction therefor in
Luxembourg, the jurisdiction of incorporation of such Lender, the
jurisdiction of the head office of such Lender, the jurisdiction where
such Lender primarily conducts its business or the jurisdiction of
such Lender's Lending Office.
"PROHIBITED PERSON" means, as to any Lender or AEF, any Person that
appears from time to time on the listing of Specially Designated
Nationals and Blocked Persons issued by the Office of Foreign Assets
Control, United States Department of the Treasury or any list of
similar nature prohibiting, restricting or declaring unlawful lending
activity to any Person (other than any list identifying Governmental
Authorities) issued by any Governmental Authority in Luxembourg, any
jurisdiction of incorporation of such Lender, the jurisdiction of the
head office of such Lender, the jurisdiction in which such Lender
primarily conducts its business or the jurisdiction of such Lender's
Lending Office or by any supranational body the regulations of which
are customarily or mandatorily complied with by such Lender or AEF or
a Person that is owned or controlled by, or derives any material
portion of its revenues from, a Person on such list.
"PROJECT" means, collectively, the construction, acquisition,
financing, launch and operation of the Satellite (if the Customer
shall have been determined to be a Category 2 Customer or a Category 3
Customer, as contemplated by the Business Plan), together with any
related assets constituting Collateral.
"PROJECT AGENT" means the agent, if any, acting for and on behalf of
the Project Lenders, and any successor Project Agent appointed
pursuant to the provisions of the Project Financing Agreements.
"PROJECT FINANCING" means, if applicable, the secured debt financing
for the construction, acquisition and operation of the Satellite, the
TTC&M Facilities and other Project components other than launch
services provided by the Project Lenders and secured by a Lien on all
or a portion of the Collateral; PROVIDED that (a) solely for the
purpose of the definition of "TOTAL ADVANCE RATE" (including, without
limitation, but solely for such purpose, as used in ancillary
definitions to the extent necessary to determine the "TOTAL ADVANCE
RATE"), the term "PROJECT FINANCING" shall be deemed not to include
any such secured debt financing that is not secured by the Satellite,
(b) solely for the purpose of Section 6.06, the term "PROJECT
FINANCING" shall be deemed not to include any such secured financing
that is not secured by the Satellite and the holders of which are not
entitled to share in the proceeds of any insurance maintained pursuant
to said Section 6.06 and (c) solely for the purposes of Sections 2.11,
4.01(a)(vi), 4.02(e) and 4.03(a)(iii), the term "PROJECT FINANCING"
shall be deemed not to include any such secured financing that is not
secured by the Satellite unless otherwise directed or agreed to by
AEF.
"PROJECT FINANCING AGREEMENTS" means, if applicable, the agreements
evidencing or governing the Project Financing.
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<PAGE> 36
"PROJECT LENDERS" means the financial institutions party to the
Project Financing Agreements as lenders and any Person that has been
assigned any or all of the rights or obligations of a Project Lender
as set forth therein or any successor thereto.
"PROJECT LOAN" or "PROJECT LOANS" means any amount advanced by the
Project Lenders pursuant to the Project Financing Agreements.
"QL CASH FLOW" means, for any period, (a) the sum of the revenues from
rental payments due under all of the Qualified Lease Agreements of the
Customer for such period plus the decrease, if any, in Non-Cash
Working Capital for such period less (b) the sum of (i) the operating
expenses of the Customer; plus (ii) the income taxes paid in cash by
the Customer; plus (iii) the increase in Non-Cash Working Capital,
where the items described in clause (b) above have been allocated by
the Customer among its various operations and sources of revenues in a
manner acceptable to AEF (provided that, if such manner is not
acceptable to AEF, and AEF and the Customer do not otherwise agree to
an allocation, the full amount of such items shall be subtracted
pursuant to said clause (b)).
"QL WEIGHTED AVERAGE TERM" means: (a) the sum of the products of the
revenues from rental payments under all of the Qualified Lease
Agreements multiplied by the respective numbers of years (calculated
to one (1) decimal place) from the Conversion Date to the respective
dates on which such rental payments are due, DIVIDED BY (b) the
aggregate amount of all revenues from rental payments under all
Qualified Lease Agreements.
"QUALIFIED LEASE AGREEMENTS" means, if the Customer shall have been
determined to be a Category 1C Customer or a Category 2 Customer,
valid, binding and enforceable agreements for the lease of
transponders or use of the communications capacity of the Satellite,
in form and substance satisfactory to AEF, which agreements shall
have, without limitation, the features set out in ANNEX 2.
"QUOTATION DATE" means, in relation to any period for which an
interest rate is to be determined hereunder, the day on which
quotations would ordinarily be given by prime banks in the London
interbank market for deposits in Dollars for delivery on the first day
of that period PROVIDED that, if, for any such period, quotations
would ordinarily be given on more than one date, the Quotation Date
for that period shall be the last of those dates.
"RATE CONTRACTS" means any swap, option, cap, floor and collar
agreements, interest rate insurance, currency spot and forward
contracts and other derivative or hedging instruments and other
agreements or arrangements designed to provide protection against
fluctuations in interest or currency exchange rates.
"RCB" means the Radiocommunication Bureau of the ITU.
"RECONVERSION" has the meaning specified in Section 2.04(b).
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"RECOVERING PERSON" has the meaning specified in Section 3.02(a).
"REFERENCE BANKS" means the principal London offices of Credit
Lyonnais, ING Bank, and Societe Generale or such other bank or banks
as may from time to time be agreed between the Customer and AEF.
"REFLIGHT" means (a) with respect to an Ariane 5 Launch Vehicle, a
"Reflight" of the Satellite or (b) with respect to an Ariane 4 Launch
Vehicle, a Replacement Launch of the Satellite that is ordered during
the Request Period and that is paid for substantially by a "Relaunch
Credit Option", as such terms are defined in the Launch Services
Agreement.
"RELATED ACCOUNTING RECONCILIATION" means, with respect to any
financial statements prepared in accordance with Generally Accepted
Accounting Principles, calculations and explanations in reasonable
detail, and certified by an internationally- |
