Exhibit 10.1
 
$100,000,000
CREDIT AGREEMENT
among
SPACE SYSTEMS/LORAL, INC.,
as Borrower,
The Several Lenders from Time to Time Parties Hereto,
BANK OF AMERICA, N.A.,
as Documentation Agent,
ING Bank N.V.,
as Syndication Agent,
and
JPMORGAN CHASE BANK, N.A.,
as Administrative Agent
Dated as of October 16, 2008
 
J.P. MORGAN SECURITIES INC., as Sole Lead Arranger and Sole Bookrunner

 

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TABLE OF CONTENTS

              Page  
SECTION 1. DEFINITIONS
    1  
 
       
1.1. Defined Terms
    1  
1.2. Other Definitional Provisions
    18  
 
       
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS
    19  
 
       
2.1. Revolving Commitments
    19  
2.2. Procedure for Revolving Loan Borrowing
    19  
2.3. Swingline Commitment
    20  
2.4. Procedure for Swingline Borrowing; Refunding of Swingline Loans
    20  
2.5. Commitment Fees, etc
    22  
2.6. Termination or Reduction of Revolving Commitments
    22  
2.7. Optional Prepayments
    22  
2.8. Mandatory Prepayments
    23  
2.9. Conversion and Continuation Options
    23  
2.10. Limitations on Eurodollar Tranches
    24  
2.11. Interest Rates and Payment Dates
    24  
2.12. Computation of Interest and Fees
    24  
2.13. Inability to Determine Interest Rate
    25  
2.14. Pro Rata Treatment and Payments
    25  
2.15. Requirements of Law
    27  
2.16. Taxes
    28  
2.17. Indemnity
    30  
2.18. Change of Lending Office
    30  
2.19. Replacement of Lenders
    30  
2.20. Revolving Credit Commitment Increases
    31  
2.21. Optional Termination by a Lender
    32  
 
       
SECTION 3. LETTERS OF CREDIT
    33  
 
       
3.1. L/C Commitment
    33  
3.2. Procedure for Issuance of Letter of Credit
    33  
3.3. Fees and Other Charges
    34  
3.4. L/C Participations
    34  
3.5. Reimbursement Obligation of the Borrower
    35  
3.6. Obligations Absolute
    35  
3.7. Letter of Credit Payments
    36  
3.8. Applications
    36  
 
       
SECTION 4. REPRESENTATIONS AND WARRANTIES
    36  
 
       
4.1. Financial Condition
    36  

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              Page  
4.2. No Change
    37  
4.3. Existence; Compliance with Law
    37  
4.4. Power; Authorization; Enforceable Obligations
    37  
4.5. No Legal Bar
    37  
4.6. Litigation
    38  
4.7. No Default
    38  
4.8. Ownership of Property; Liens
    38  
4.9. Intellectual Property
    38  
4.10. Taxes
    38  
4.11. Federal Regulations
    38  
4.12. Labor Matters
    38  
4.13. ERISA
    39  
4.14. Investment Company Act; Other Regulations
    39  
4.15. Subsidiaries
    39  
4.16. Use of Proceeds
    39  
4.17. Environmental Matters
    39  
4.18. Accuracy of Information, etc
    40  
4.19. Security Documents
    41  
4.20. Solvency
    41  
4.21. Regulation H
    41  
4.22. Senior Indebtedness
    41  
 
       
SECTION 5. CONDITIONS PRECEDENT
    41  
 
       
5.1. Conditions to Initial Extension of Credit
    41  
5.2. Conditions to Each Extension of Credit
    45  
 
       
SECTION 6. AFFIRMATIVE COVENANTS
    45  
 
       
6.1. Financial Statements
    45  
6.2. Certificates; Other Information
    46  
6.3. Payment of Obligations
    47  
6.4. Maintenance of Existence; Compliance
    48  
6.5. Maintenance of Property; Insurance
    48  
6.6. Inspection of Property; Books and Records; Discussions
    48  
6.7. Notices
    48  
6.8. Environmental Laws
    49  
6.9. Additional Collateral, etc
    49  
6.10. Reporting Requirements
    51  
 
       
SECTION 7. NEGATIVE COVENANTS
    51  
 
       
7.1. Financial Condition Covenants.
    51  
7.2. Indebtedness
    51  
7.3. Liens
    53  
7.4. Fundamental Changes
    55  
7.5. Disposition of Property
    55  

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              Page  
7.6. Restricted Payments
    56  
7.7. Capital Expenditures
    58  
7.8. Investments
    58  
7.9. Optional Payments and Modifications of Certain Debt Instruments
    59  
7.10. Transactions with Affiliates
    59  
7.11. Sales and Leasebacks
    59  
7.12. Swap Agreements
    59  
7.13. Negative Pledge Clauses
    59  
7.14. Clauses Restricting Subsidiary Distributions
    60  
7.15. Lines of Business
    60  
7.16. Changes in Fiscal Periods
    60  
 
     
SECTION 8. EVENTS OF DEFAULT
    60  
 
       
8.1. Events of Default
    60  
8.2. Borrower’s Right to Cure
    64  
 
       
SECTION 9. THE AGENTS
    64  
 
       
9.1. Appointment
    64  
9.2. Delegation of Duties
    64  
9.3. Exculpatory Provisions
    64  
9.4. Reliance by Administrative Agent
    65  
9.5. Notice of Default
    65  
9.6. Non-Reliance on Agents and Other Lenders
    65  
9.7. Indemnification
    66  
9.8. Agent in Its Individual Capacity
    66  
9.9. Successor Administrative Agent
    66  
9.10. Documentation Agent and Syndication Agent
    67  
 
       
SECTION 10. MISCELLANEOUS
    67  
 
       
10.1. Amendments and Waivers
    67  
10.2. Notices
    68  
10.3. No Waiver; Cumulative Remedies
    69  
10.4. Survival of Representations and Warranties
    69  
10.5. Payment of Expenses and Taxes
    69  
10.6. Successors and Assigns; Participations and Assignments
    70  
10.7. Adjustments; Set-off
    73  
10.8. Counterparts
    74  
10.9. Severability
    74  
10.10. Integration
    74  
10.11. Governing Law
    74  
10.12. Submission To Jurisdiction; Waivers
    74  
10.13. Acknowledgements
    75  
10.14. Releases of Guarantees and Liens
    75  
10.15. Confidentiality
    75  
10.16. WAIVERS OF JURY TRIAL
    76  

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SCHEDULES:

     
1.1A
  Commitments
1.1B
  Mortgaged Property
1.1C
  Vendor Financing
4.4
  Consents, Authorizations, Filings and Notices
4.13
  Reportable Events
4.15
  Subsidiaries
4.19(a) 
  UCC Filing Jurisdictions
4.19(b)
  Mortgage Filing Jurisdictions
7.2(d)
  Existing Indebtedness
7.3(f)
  Existing Liens
7.3(p)
  Title Report Liens
7.8
  Investments
7.10
  Affiliate Transactions

EXHIBITS:

     
A
  Form of Guarantee and Collateral Agreement
B
  Form of Pledge and Security Agreement
C
  Form of Compliance Certificate
D
  Form of Closing Certificate
E
  Form of Mortgage
F
  Form of Assignment and Assumption
G-1
  Form of Legal Opinion of Willkie Farr & Gallagher LLP
G-2
  Form of Legal Opinion of Julie Bannerman, Esq.
G-3
  Form of Legal Opinion of Heller Ehrman LLP
H
  Form of Exemption Certificate
I
  Form of Parent Guarantee
J-1
  Form of New Lender Supplement
J-2
  Form of Commitment Increase Supplement

iv

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          CREDIT AGREEMENT (this “Agreement”), dated as of October 16, 2008,
among SPACE SYSTEMS/LORAL, INC., a Delaware corporation (the “Borrower”), the
several banks and other financial institutions or entities from time to time
parties to this Agreement (the “Lenders”), BANK OF AMERICA, N.A., as
documentation agent (in such capacity, the “Documentation Agent”), ING Bank
N.V., as syndication agent (in such capacity, the “Syndication Agent”), and
JPMORGAN CHASE BANK, N.A., as administrative agent.
          The parties hereto hereby agree as follows:
SECTION 1. DEFINITIONS
          1.1. Defined Terms. As used in this Agreement, the terms listed in
this Section 1.1 shall have the respective meanings set forth in this
Section 1.1.
          “ABR”: for any day, a rate per annum (rounded upwards, if necessary,
to the next 1/16 of 1%) equal to the greater of (a) the Prime Rate in effect on
such day and (b) the Federal Funds Effective Rate in effect on such day plus 1/2
of 1%. Any change in the ABR due to a change in the Prime Rate or the Federal
Funds Effective Rate shall be effective as of the opening of business on the
effective day of such change in the Prime Rate or the Federal Funds Effective
Rate, respectively.
          “ABR Loans”: Loans the rate of interest applicable to which is based
upon the ABR.
          “Administrative Agent”: JPMorgan Chase Bank, N.A., together with its
affiliates, as the arranger of the Commitments and as the administrative agent
for the Lenders under this Agreement and the other Credit Documents, together
with any of its successors.
          “Affiliate”: as to any Person, any other Person that, directly or
indirectly, is in control of, is controlled by, or is under common control with,
such Person. For purposes of this definition, “control” of a Person means the
power, directly or indirectly, either to (a) vote 15% or more of the securities
having ordinary voting power for the election of directors (or persons
performing similar functions) of such Person or (b) direct or cause the
direction of the management and policies of such Person, whether by contract or
otherwise.
          “Agents”: the collective reference to the Syndication Agent, the
Documentation Agent and the Administrative Agent.
          “Aggregate Exposure”: with respect to any Lender at any time, an
amount equal to the amount of such Lender’s Revolving Commitment then in effect
or, if the Revolving Commitments have been terminated, the amount of such
Lender’s Revolving Extensions of Credit then outstanding.
          “Aggregate Exposure Percentage”: with respect to any Lender at any
time, the ratio (expressed as a percentage) of such Lender’s Aggregate Exposure
at such time to the Aggregate Exposure of all Lenders at such time.
          “Agreement”: as defined in the preamble hereto.

 

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          “Applicable Margin”: for each Type of Loan, the rate per annum set
forth under the relevant column heading below:

                      ABR Loans   Eurodollar Loans
Revolving Loans and Swingline Loans
    2.75 %     3.75 %

          “Application”: an application, in such form as the Issuing Lender may
specify from time to time, requesting the Issuing Lender to open a Letter of
Credit.
          “Approved Fund”: as defined in Section 10.6(b).
          “Apstar Transponder Lease”: the lease resulting from the ChinaSat
Transponder Agreement dated as of November 21, 2005 between the Borrower and
Loral Skynet Corporation.
          “Asset Sale”: any Disposition of property or series of related
Dispositions of property (excluding any such Disposition permitted by clause
(a), (b), (c), (d), (e) or (f) of Section 7.5) that yields gross proceeds to any
Group Member (valued at the initial principal amount thereof in the case of
non-cash proceeds consisting of notes or other debt securities and valued at
fair market value in the case of other non-cash proceeds) in excess of
$1,000,000.
          “Asset Sale Excess Proceeds”: as defined in Section 2.8(c).
          “Assignee”: as defined in Section 10.6(b).
          “Assignment and Assumption”: an Assignment and Assumption,
substantially in the form of Exhibit F.
          “Available Liquidity”: at any date, the sum of the Unrestricted Cash
and Cash Equivalents of the Borrower and its Subsidiaries at such date, plus the
lesser of (a) the Available Revolving Commitments and (b) the maximum amount
that could then be borrowed under the Available Revolving Commitments after
giving effect to which the Borrower would be in pro forma compliance with
Section 7.1(a).
          “Available Revolving Commitment”: as to any Lender at any time, an
amount equal to the excess, if any, of (a) such Lender’s Revolving Commitment
then in effect over (b) such Lender’s Revolving Extensions of Credit then
outstanding; provided, that in calculating any Lender’s Revolving Extensions of
Credit for the purpose of determining such Lender’s Available Revolving
Commitment pursuant to Section 2.5(a), the aggregate principal amount of
Swingline Loans then outstanding shall be deemed to be zero.
          “Benefitted Lender”: as defined in Section 10.7(a).
          “Board”: the Board of Governors of the Federal Reserve System of the
United States (or any successor).
          “Borrower”: as defined in the preamble hereto.

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          “Borrowing Date”: any Business Day specified by the Borrower as a date
on which the Borrower requests the relevant Lenders to make Loans hereunder.
          “Business”: as defined in Section 4.17(b).
          “Business Day”: a day other than a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law to
close, provided, that with respect to notices and determinations in connection
with, and payments of principal and interest on, Eurodollar Loans, such day is
also a day for trading by and between banks in Dollar deposits in the interbank
eurodollar market.
          “Capital Expenditures”: for any period, with respect to any Person,
the aggregate of all expenditures by such Person and its Subsidiaries for the
acquisition or leasing (pursuant to a capital lease) of fixed or capital assets
or additions to equipment (including replacements, capitalized repairs and
improvements during such period) that should be capitalized under GAAP on a
consolidated balance sheet of such Person and its Subsidiaries.
          “Capital Lease Obligations”: as to any Person, the obligations of such
Person to pay rent or other amounts under any lease of (or other arrangement
conveying the right to use) real or personal property, or a combination thereof,
which obligations are required to be classified and accounted for as capital
leases on a balance sheet of such Person under GAAP and, for the purposes of
this Agreement, the amount of such obligations at any time shall be the
capitalized amount thereof at such time determined in accordance with GAAP.
          “Capital Stock”: any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation, any
and all equivalent ownership interests in a Person (other than a corporation)
and any and all warrants, rights or options to purchase any of the foregoing.
          “Cash Equivalents”: (a) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one year from the date of acquisition;
(b) certificates of deposit, time deposits, eurodollar time deposits or
overnight bank deposits having maturities of six months or less from the date of
acquisition issued by any Lender or by any commercial bank organized under the
laws of the United States or any state thereof having combined capital and
surplus of not less than $500,000,000; (c) commercial paper of a corporate
issuer rated at least A-1 by Standard & Poor’s Ratings Services (“S&P”) or P-1
by Moody’s Investors Service, Inc. (“Moody’s”), or carrying an equivalent rating
by a nationally recognized rating agency, if both of the two named rating
agencies cease publishing ratings of commercial paper issuers generally, and
maturing within six months from the date of acquisition; (d) repurchase
obligations of any Lender or of any commercial bank satisfying the requirements
of clause (b) of this definition, having a term of not more than 30 days, with
respect to securities issued or fully guaranteed or insured by the United States
government; (e) securities with maturities of one year or less from the date of
acquisition issued or fully guaranteed by any state, commonwealth or territory
of the United States, by any political subdivision or taxing authority of any
such state, commonwealth or territory or by any foreign government, the
securities of which state, commonwealth, territory,

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political subdivision, taxing authority or foreign government (as the case may
be) are rated at least A by S&P or A by Moody’s; (f) securities with maturities
of six months or less from the date of acquisition backed by standby letters of
credit issued by any Lender or any commercial bank satisfying the requirements
of clause (b) of this definition; (g) money market mutual or similar funds that
invest exclusively in assets satisfying the requirements of clauses (a) through
(f) of this definition; or (h) money market funds that (i) comply with the
criteria set forth in SEC Rule 2a-7 under the Investment Company Act of 1940, as
amended, (ii) are rated AAA by S&P and Aaa by Moody’s and (iii) have portfolio
assets of at least $5,000,000,000. “Cash Equivalents” shall not include any
auction rate securities.
          “Closing Date”: the date on which the conditions precedent set forth
in Section 5.1 shall have been satisfied, which date is October 16, 2008.
          “Code”: the Internal Revenue Code of 1986, as amended from time to
time.
          “Collateral”: all property of the Loan Parties, now owned or hereafter
acquired, upon which a Lien is purported to be created by any Security Document.
          “Commitment”: as to any Lender, the Revolving Commitment of such
Lender.
          “Commitment Fee Rate”: 0.625% per annum.
          “Commonly Controlled Entity”: an entity, whether or not incorporated,
that is under common control with the Borrower within the meaning of
Section 4001 of ERISA or is part of a group that includes the Borrower and that
is treated as a single employer under Section 414 of the Code.
          “Competing Person”: any Person who is actually engaged in direct
competition with the Borrower or its Subsidiaries in the business of the
Borrower and its Subsidiaries described in the Confidential Information
Memorandum (as such business may be expanded in accordance with Section 7.15,
the “Business”) or who is an Affiliate of any such Person (excluding any such
Affiliate which is a life insurance company or bank and any wholly owned
subsidiaries of such Person, provided that such Affiliate is not actually
engaged in direct competition with the Borrower or its Subsidiaries in the
Business).
          “Compliance Certificate”: a certificate duly executed by a Responsible
Officer substantially in the form of Exhibit C.
          “Confidential Information Memorandum”: the Confidential Information
Memorandum dated June 10, 2008 and furnished to certain Lenders.
          “Consolidated EBITDA”: for any period, the Consolidated Net Income of
the Borrower and its Subsidiaries for such period plus, without duplication and
to the extent reflected as a charge in the consolidated income statement of the
Borrower and its Subsidiaries for such period, the sum of (a) income tax expense
(in accordance with GAAP as reflected on the Borrower’s consolidated statement
of operations), (b) interest expense (in accordance with GAAP as reflected on
the Borrower’s consolidated statement of operations) (c) depreciation and
amortization (including stock based compensation) expense, (d) losses on foreign
exchange

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contracts (in accordance with GAAP as reflected on the Borrower’s consolidated
statement of operations) , (e) expenses set forth opposite the caption “Other
income (expense)” (or like caption) on such consolidated statement of operations
provided that the cash portion thereof shall not exceed $10,000,000, (f) equity
in net losses of affiliates of the Borrower, (g) minority interests in earnings
of Subsidiaries of the Borrower, (h) total corporate overhead expenses of Loral
charged to the Borrower to the extent not paid in cash by the Borrower, (i) the
initial forward loss recognition on satellite purchase agreements awarded to the
Borrower and its Subsidiaries after December 31, 2007 in an amount for any one
satellite construction contract (other than the contract for NSS 14) not to
exceed the contribution margin therefor (as determined by the Borrower in
accordance with its practices in effect on the date hereof) and in an aggregate
amount for any period of four consecutive fiscal quarters not to exceed
$15,000,000 (or $20,000,000 for any such period ending on or before March 31,
2009) and (j) any “extraordinary losses” as such term is defined in accordance
with GAAP and minus, without duplication and to the extent included in arriving
at Consolidated Net Income for such period, the sum of the following amounts
(a) the amortization of the initial forward loss recognition on satellite
purchase agreements described in clause (i) above amortized over the life of the
original planned construction period calculated on a percentage of completion
basis without change for schedule changes over the life of the satellite
purchase agreement, (b) interest income in accordance with GAAP as reflected on
the Borrower’s consolidated statement of operations (other than any such
interest income in respect of Orbital Receivables), (c) gains on foreign
exchange contracts (in accordance with GAAP as reflected on the Borrower’s
consolidated statement of operations), (d) income set forth opposite the caption
“Other income (expense)” (or like caption) on such statement of operations
provided that the cash portion thereof shall not exceed $10,000,000, (e) equity
in net gains of affiliates of the Borrower, (f) minority interests in losses of
Subsidiaries of the Borrower, (g) losses from sales (whether or not “true
sales”) of Vendor Financing Receivables or Orbital Receivables for less than
book value and (h) any “extraordinary gains” as such term is defined in
accordance with GAAP.
          “Consolidated Interest Coverage Ratio”: for any period, the ratio of
(a) Consolidated EBITDA for such period to (b) Consolidated Interest Expense for
such period.
          “Consolidated Interest Expense”: for any period, total interest
expense, to be paid currently in cash (including that attributable to Capital
Lease Obligations) of the Borrower and its Subsidiaries accrued in such period
with respect to all outstanding Indebtedness of the Borrower and its
Subsidiaries (including all commissions, discounts and other fees and charges
owed with respect to letters of credit and bankers’ acceptance financing and net
costs under Swap Agreements in respect of interest rates to the extent such net
costs are allocable to such period in accordance with GAAP).
          “Consolidated Leverage Ratio”: as at any day, the ratio of
(a) Consolidated Total Debt on such day to (b) Consolidated EBITDA for the four
fiscal quarter period ended on such day or, if not ended on such day, the most
recently ended four fiscal quarter period prior to such day.
          “Consolidated Net Income”: for any period, the consolidated net income
(or loss) of the Borrower and its Subsidiaries, determined on a consolidated
basis in accordance with GAAP and before the payment of dividends; provided that
there shall be excluded (a) the income

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(or deficit) of any Person accrued prior to the date it becomes a Subsidiary of
the Borrower or is merged into or consolidated with the Borrower or any of its
Subsidiaries, (b) the income (or deficit) of any Person (other than a Subsidiary
of the Borrower) in which the Borrower or any of its Subsidiaries has an
ownership interest, except to the extent that any such income is actually
received by the Borrower or such Subsidiary in the form of dividends or similar
distributions and (c) the undistributed earnings of any Subsidiary of the
Borrower to the extent that the declaration or payment of dividends or similar
distributions by such Subsidiary is not at the time permitted by the terms of
any Contractual Obligation (other than under any Credit Documents) or
Requirement of Law applicable to such Subsidiary.
          “Consolidated Total Debt”: at any date, the aggregate principal amount
of all Indebtedness of the Borrower and its Subsidiaries at such date,
determined on a consolidated basis in accordance with GAAP and after taking into
account any Indebtedness to be incurred, paid or prepaid on such date.
          “Continuing Directors”: the directors of Loral on the Closing Date,
and each other director, if, in each case, such other director’s nomination for
election to the board of directors of Loral is recommended by at least 66 2/3%
of the then Continuing Directors in his or her election by the shareholders of
Loral.
          “Contractual Obligation”: as to any Person, any provision of any
security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
          “Credit Documents”: this Agreement, the Security Documents, the Notes,
the Parent Guarantee (only upon its execution and delivery) and any amendment,
waiver, supplement or other modification to any of the foregoing.
          “Default”: any of the events specified in Section 8, whether or not
any requirement for the giving of notice, the lapse of time, or both, has been
satisfied.
          “Disposition”: with respect to any property, any sale, lease (other
than the Apstar Transponder Lease), sale and leaseback, assignment, conveyance,
transfer or other disposition thereof. The terms “Dispose” and “Disposed of”
shall have correlative meanings.
          “Documentation Agent”: as defined in the preamble hereto.
          “Dollars” and “$”: dollars in lawful currency of the United States.
          “Domestic Subsidiary”: any Subsidiary of the Borrower organized under
the laws of any jurisdiction within the United States.
          “Environmental Laws”: any and all foreign, Federal, state, local or
municipal laws, rules, orders, regulations, statutes, ordinances, codes,
decrees, requirements of any Governmental Authority or other Requirements of Law
(including common law) regulating, relating to or imposing liability or
standards of conduct concerning protection of human health or the environment,
as now or may at any time hereafter be in effect.

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          “ERISA”: the Employee Retirement Income Security Act of 1974, as
amended from time to time.
          “Eurocurrency Reserve Requirements”: for any day as applied to a
Eurodollar Loan, the aggregate (without duplication) of the maximum rates
(expressed as a decimal fraction) of reserve requirements in effect on such day
(including basic, supplemental, marginal and emergency reserves) under any
regulations of the Board or other Governmental Authority having jurisdiction
with respect thereto dealing with reserve requirements prescribed for
eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in
Regulation D of the Board) maintained by a member bank of the Federal Reserve
System.
          “Eurodollar Base Rate”: with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, the rate per annum determined on the
basis of the rate for deposits in Dollars for a period equal to such Interest
Period commencing on the first day of such Interest Period appearing on the
Reuters Screen LIBOR01 Page as of 11:00 A.M., London time, two Business Days
prior to the beginning of such Interest Period. In the event that such rate does
not appear on such page (or otherwise on such screen), the “Eurodollar Base
Rate” shall be determined by reference to such other comparable publicly
available service for displaying eurodollar rates as may be selected by the
Administrative Agent or, in the absence of such availability, by reference to
the rate at which the Administrative Agent is offered Dollar deposits at or
about 11:00 A.M., New York City time, two Business Days prior to the beginning
of such Interest Period in the interbank eurodollar market where its eurodollar
and foreign currency and exchange operations are then being conducted for
delivery on the first day of such Interest Period for the number of days
comprised therein.
          “Eurodollar Loans”: Loans the rate of interest applicable to which is
based upon the Eurodollar Rate.
          “Eurodollar Rate”: with respect to each day during each Interest
Period pertaining to a Eurodollar Loan, a rate per annum determined for such day
in accordance with the following formula:
Eurodollar Base Rate
1.00 – Eurocurrency Reserve Requirements
          “Eurodollar Tranche”: the collective reference to Eurodollar Loans
under the Revolving Facility the then current Interest Periods with respect to
all of which begin on the same date and end on the same later date (whether or
not such Loans shall originally have been made on the same day).
          “Event of Default”: any of the events specified in Section 8, provided
that any requirement for the giving of notice, the lapse of time, or both, has
been satisfied.
          “Existing Reimbursement Agreement”: as defined in Section 3.1(c).
          “Federal Funds Effective Rate”: for any day, the weighted average of
the rates on overnight federal funds transactions with members of the Federal
Reserve System arranged by

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federal funds brokers, as published on the next succeeding Business Day by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day that is a Business Day, the average of the quotations for the day of such
transactions received by the Administrative Agent from three federal funds
brokers of recognized standing selected by it.
          “Fee Payment Date”: (a) the third Business Day following the last day
of each March, June, September and December and (b) the last day of the
Revolving Commitment Period.
          “Foreign Subsidiary”: any Subsidiary of the Borrower that is not a
Domestic Subsidiary.
          “Funding Office”: the office of the Administrative Agent specified in
Section 10.2 or such other office as may be specified from time to time by the
Administrative Agent as its funding office by written notice to the Borrower and
the Lenders.
          “GAAP”: generally accepted accounting principles in the United States
as in effect from time to time, except that for purposes of Section 7.1, GAAP
shall be determined on the basis of such principles in effect on the date hereof
and consistent with those used in the preparation of the most recent audited
financial statements referred to in Section 4.1(b). In the event that any
“Accounting Change” (as defined below) shall occur and such change results in a
change in the method of calculation of financial covenants, standards or terms
in this Agreement, then the Borrower and the Administrative Agent agree to enter
into negotiations in order to amend such provisions of this Agreement so as to
reflect equitably such Accounting Changes with the desired result that the
criteria for evaluating the Borrower’s financial condition shall be the same
after such Accounting Changes as if such Accounting Changes had not been made.
Until such time as such an amendment shall have been executed and delivered by
the Borrower, the Administrative Agent and the Required Lenders, all financial
covenants, standards and terms in this Agreement shall continue to be calculated
or construed as if such Accounting Changes had not occurred. “Accounting
Changes” refers to changes in accounting principles required by the promulgation
of any rule, regulation, pronouncement or opinion by the Financial Accounting
Standards Board of the American Institute of Certified Public Accountants or, if
applicable, the SEC or the International Accounting Standards Board.
          “Governmental Authority”: any nation or government, any state or other
political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, central bank or other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative functions of or
pertaining to government, any securities exchange and any self-regulatory
organization (including the National Association of Insurance Commissioners).
          “Group Members”: the collective reference to the Borrower and its
Subsidiaries.
          “Guarantee and Collateral Agreement”: the Guarantee and Collateral
Agreement to be executed and delivered by the Borrower and each Guarantor,
substantially in the form of Exhibit A.
          “Guarantee Obligation”: as to any Person (the “guaranteeing person”),
any obligation, including a reimbursement, counterindemnity or similar
obligation, of the

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guaranteeing Person that guarantees or in effect guarantees, or which is given
to induce the creation of a separate obligation by another Person (including any
bank under any letter of credit) that guarantees or in effect guarantees, any
Indebtedness, leases, dividends or other obligations (the “primary obligations”)
of any other third Person (the “primary obligor”) in any manner, whether
directly or indirectly, including any obligation of the guaranteeing person,
whether or not contingent, (i) to purchase any such primary obligation or any
property constituting direct or indirect security therefor other than at fair
market value, (ii) to advance or supply funds (1) for the purchase or payment of
any such primary obligation or (2) to maintain working capital or equity capital
of the primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (iii) to purchase property, securities or services other than
at fair market value 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 or (iv) otherwise to assure or hold harmless the owner of any
such primary obligation against loss in respect thereof; provided, however, that
the term Guarantee Obligation shall not include endorsements of instruments for
deposit or collection in the ordinary course of business. The amount of any
Guarantee Obligation of any guaranteeing person shall be deemed to be the lower
of (a) an amount equal to the stated or determinable amount of the primary
obligation in respect of which such Guarantee Obligation is made and (b) the
maximum amount for which such guaranteeing person may be liable pursuant to the
terms of the instrument embodying such Guarantee Obligation, unless such primary
obligation and the maximum amount for which such guaranteeing person may be
liable are not stated or determinable, in which case the amount of such
Guarantee Obligation shall be such guaranteeing person’s maximum reasonably
anticipated liability in respect thereof as determined by the Borrower in good
faith.
          “Guarantors”: each of the Borrower’s direct and indirect, existing and
future, wholly-owned Subsidiaries other than any Foreign Subsidiary.
          “Holdings”: Loral Space & Communications Holdings Corporation, a
Delaware corporation.
          “Holdings Pledge Agreement”: the Pledge and Security Agreement to be
executed and delivered by Holdings substantially in the form of Exhibit B.
          “Immaterial Subsidiary”: International Space Technology, Inc. and each
Subsidiary of the Borrower designated as such by the Borrower in
Section 6.2(b)(iv) (i) that owns or otherwise holds no proprietary Intellectual
Property, (ii) that has assets with an aggregate value not exceeding $5,000,000
and (iii) that when taken together with all other Immaterial Subsidiaries, has
assets with an aggregate value not exceeding $50,000,000.
          “Increase Effective Date”: the date on which the Administrative Agent
shall have received a Revolving Commitment Increase Notice and all conditions
precedent to the effectiveness of any such Revolving Commitment increase set
forth in Section 2.20 shall have been satisfied.
          “Indebtedness”: of any Person at any date, without duplication,
(a) all indebtedness of such Person for borrowed money, (b) all obligations of
such Person for the deferred purchase price of property or services (other than
trade payables and other liabilities

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arising as a result of progress payments, milestones, customer advances,
warranty provisions or similar arrangements related to contracts incurred in the
ordinary course of such Person’s business), (c) all obligations of such Person
evidenced by notes, bonds, debentures or other similar instruments, (d) all
indebtedness created or arising under any conditional sale or other title
retention agreement with respect to property acquired by such Person (even
though the rights and remedies of the seller or lender under such agreement in
the event of default are limited to repossession or sale of such property), but
excluding such liabilities arising as a result of progress payments, milestones,
customer advances, warranty provisions or similar arrangements related to
contracts incurred in the ordinary course of business, (e) all Capital Lease
Obligations of such Person, (f) all reimbursement obligations of such Person as
an account party or applicant under or in respect of acceptances, letters of
credit, surety bonds or similar arrangements that are not paid within one
Business Day of the date such obligations are incurred, (g) all obligations of
such Person, contingent or otherwise, in respect of Dispositions by such Person
of Orbital Receivables or Vendor Financing Receivables that may not be accounted
for as “true sales” in accordance with GAAP, (h) the liquidation value of all
mandatorily redeemable preferred Capital Stock of such Person, (i) all Guarantee
Obligations of such Person in respect of obligations of the kind referred to in
clauses (a) through (h) above, (j) all obligations of the kind referred to in
clauses (a) through (i) above secured by (or for which the holder of such
obligation has an existing right, contingent or otherwise, to be secured by) any
Lien on property (including accounts and contract rights) owned by such Person,
whether or not such Person has assumed or become liable for the payment of such
obligation, and (k) for the purposes of Section 8(f) only, all obligations of
such Person in respect of Swap Agreements. The Indebtedness of any Person shall
include the Indebtedness of any other entity (including any partnership in which
such Person is a general partner) to the extent such Person is liable therefor
as a result of such Person’s ownership interest in or other relationship with
such entity, except to the extent the terms of such Indebtedness expressly
provide that such Person is not liable therefor.
          “Insolvency”: with respect to any Multiemployer Plan, the condition
that such Plan is insolvent within the meaning of Section 4245 of ERISA.
          “Insolvent”: pertaining to a condition of Insolvency.
          “Intellectual Property”: the collective reference to all rights,
priorities and privileges relating to intellectual property, whether arising
under United States, multinational or foreign laws or otherwise, including,
without limitation, all copyrights and works of authorship, copyright licenses,
patents, patent licenses, trademarks, trademark licenses, domain names,
technology, know-how and processes, and all rights to sue at law or in equity
for any infringement or other impairment thereof, including the right to receive
all proceeds and damages therefrom.
          “Interest Payment Date”: (a) as to any ABR Loan (other than any
Swingline Loan), the last day of each March, June, September and December (or,
if an Event of Default is in existence, the last day of each calendar month) to
occur while such Loan is outstanding and the final maturity date of such Loan,
(b) as to any Eurodollar Loan having an Interest Period of three months or less,
the last day of such Interest Period, (c) as to any Eurodollar Loan having an
Interest Period longer than three months, each day that is three months, or a
whole multiple thereof, after the first day of such Interest Period and the last
day of such Interest Period, (d) as

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to any Loan (other than any Revolving Loan that is an ABR Loan and any Swingline
Loan), the date of any repayment or prepayment made in respect thereof and
(e) as to any Swingline Loan, the day that such Loan is required to be repaid.
          “Interest Period”: as to any Eurodollar Loan, (a) initially, the
period commencing on the borrowing or conversion date, as the case may be, with
respect to such Eurodollar Loan and ending one, two, three or six months
thereafter, as selected by the Borrower in its notice of borrowing or notice of
conversion, as the case may be, given with respect thereto; and (b) thereafter,
each period commencing on the last day of the next preceding Interest Period
applicable to such Eurodollar Loan and ending one, two, three or six months
thereafter, as selected by the Borrower by irrevocable notice to the
Administrative Agent not later than 11:00 A.M., New York City time, on the date
that is three Business Days prior to the last day of the then current Interest
Period with respect thereto; provided that, all of the foregoing provisions
relating to Interest Periods are subject to the following:
     (i) if any Interest Period would otherwise end on a day that is not a
Business Day, such Interest Period 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) the Borrower may not select an Interest Period that would extend
beyond the Revolving Termination Date;
     (iii) 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 a calendar month; and
     (iv) the Borrower shall select Interest Periods so as not to require a
payment or prepayment of any Eurodollar Loan during an Interest Period for such
Loan.
          “Investments”: as defined in Section 7.8.
          “Issuing Lender”: each of JPMorgan Chase Bank, N.A. and any other
Lender approved by the Administrative Agent and the Borrower that has agreed in
its sole discretion to act as an “Issuing Lender” hereunder, or any of their
respective affiliates, in each case in its capacity as issuer of any Letter of
Credit. Each reference herein to “the Issuing Lender” shall be deemed to be a
reference to the relevant Issuing Lender.
          “L/C Commitment”: $50,000,000.
          “L/C Disbursement”: at any time, an amount equal to the sum of (a) the
aggregate then undrawn and unexpired amount of the then outstanding Letters of
Credit and (b) the aggregate amount of drawings under Letters of Credit that
have not then been reimbursed pursuant to Section 3.5.

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          “L/C Participants”: the collective reference to all the Lenders other
than the Issuing Lender.
          “Lenders”: as defined in the preamble hereto.
          “Letters of Credit”: as defined in Section 3.1(a).
          “Lien”: any mortgage, pledge, hypothecation, assignment, deposit
arrangement, encumbrance, lien (statutory or other), charge or other security
interest or any preference, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever (including any conditional sale or
other title retention agreement and any capital lease having substantially the
same economic effect as any of the foregoing).
          “Loan”: any loan made by any Lender pursuant to this Agreement.
          “Loan Party”: Loral or each Group Member that is a party to a Credit
Document.
          “Loral”: Loral Space & Communications Inc., a Delaware corporation.
          “Material Adverse Effect”: a material adverse effect on (a) the
business, operations, property or condition (financial or otherwise) of the
Borrower and its Subsidiaries taken as a whole or (b) the validity or
enforceability of this Agreement or any of the other Credit Documents or the
rights or remedies of the Administrative Agent or the Lenders hereunder or
thereunder; provided, however, that no development or event under any satellite
purchase agreement awarded to the Borrower or any of its Subsidiaries shall be
deemed to have or be reasonably expected to have a Material Adverse Effect
unless and until a written notice of termination shall be delivered to the
Borrower or such Subsidiary, as the case may be, in accordance with the
provisions of such satellite contact after the occurrence of any “event of
default” (or similar concept) under, and within the meaning of, such satellite
contact.
          “Materials of Environmental Concern”: any gasoline or petroleum
(including crude oil or any fraction thereof) or petroleum products or any
hazardous or toxic substances, materials or wastes, defined or regulated as such
in or under any Environmental Law, including asbestos, polychlorinated biphenyls
and urea-formaldehyde insulation.
          “Material Subsidiary”: each Subsidiary of the Borrower that is not an
Immaterial Subsidiary.
          “Maximum Outstanding Amount”: as defined in Section 2.1(a).
          “Mortgaged Properties”: the real properties listed on Schedule 1.1B,
as to which the Administrative Agent for the benefit of the Lenders shall be
granted a Lien pursuant to the Mortgages.
          “Mortgages”: each of the mortgages and deeds of trust made by any Loan
Party in favor of, or for the benefit of, the Administrative Agent for the
benefit of the Lenders, substantially in the form of Exhibit E (with such
changes thereto as shall be advisable under the law of the jurisdiction in which
such mortgage or deed of trust is to be recorded).

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          “Multiemployer Plan”: a Plan that is a multiemployer plan as defined
in Section 4001(a)(3) of ERISA.
          “Net Cash Proceeds”: (a) in connection with any Asset Sale or any
Recovery Event, the proceeds thereof in the form of cash and Cash Equivalents
(including any such proceeds received by way of deferred payment of principal
pursuant to a note or installment receivable or purchase price adjustment
receivable or otherwise, but only as and when received), net of attorneys’ fees,
accountants’ fees, investment banking fees, amounts required to be applied to
the repayment of Indebtedness secured by a Lien expressly permitted hereunder on
any asset that is the subject of such Asset Sale or Recovery Event (other than
any Lien pursuant to a Security Document) or paid to a customer of the Borrower
or a Subsidiary pursuant to a Contractual Obligation in existence prior to the
date of any such Recovery Event and other customary fees and expenses actually
incurred in connection therewith and net of taxes paid or reasonably estimated
to be payable as a result thereof (after taking into account any available tax
credits or deductions and any tax sharing arrangements) and (b) in connection
with any issuance or sale of Capital Stock or any incurrence of Indebtedness,
the cash proceeds received from such issuance or incurrence, net of attorneys’
fees, investment banking fees, accountants’ fees, underwriting discounts and
commissions and other customary fees and expenses actually incurred in
connection therewith.
          “New Lender”: as defined in Section 2.20(b).
          “Non-Excluded Taxes”: as defined in Section 2.16(a).
          “Non-U.S. Lender”: as defined in Section 2.16(d).
          “Notes”: the collective reference to any promissory note evidencing
Loans.
          “Obligations”: the unpaid principal of and interest on (including
interest accruing after the maturity of the Loans and Reimbursement Obligations
and interest accruing after the filing of any petition in bankruptcy, or the
commencement of any insolvency, reorganization or like proceeding, relating to
the Borrower, whether or not a claim for post-filing or post-petition interest
is allowed in such proceeding) the Loans and all other obligations and
liabilities of the Borrower to the Administrative Agent or to any Lender (or, in
the case of Specified Swap Agreements and Specified Cash Management Agreements,
any affiliate of any Lender), whether direct or indirect, absolute or
contingent, due or to become due, or now existing or hereafter incurred, which
may arise under, out of, or in connection with, this Agreement, any other Credit
Documents, the Letters of Credit, any Specified Swap Agreement, any Specified
Cash Management Agreement or any other document made, delivered or given in
connection herewith or therewith, whether on account of principal, interest,
reimbursement obligations, fees, indemnities, costs, expenses (including all
documented fees, charges and disbursements of counsel to the Administrative
Agent or to any Lender that are required to be paid by the Borrower pursuant
hereto) or otherwise.
          “Orbital Receivables”: satellite orbital incentive payments payable to
the Borrower or any of its Subsidiaries under satellite purchase agreements and
any other contingent payments related to satellite construction projects.

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          “Other Taxes”: any and all present or future stamp or documentary
taxes or any other excise or property taxes, charges or similar levies arising
from any payment made hereunder or from the execution, delivery or enforcement
of, or otherwise with respect to, this Agreement or any other Credit Documents.
          “Parent Guarantee”: the Parent Guarantee Agreement to be executed and
delivered by Loral, in the form of Exhibit I. The Administrative Agent shall
promptly notify each Lender (i) if Loral executes and delivers the Parent
Guarantee, with a copy of the executed Parent Guarantee to promptly follow, and
(ii) if Loral does not execute and deliver the Parent Guarantee on or prior to
January 14, 2009.
          “Participant”: as defined in Section 10.6(c).
          “PBGC”: the Pension Benefit Guaranty Corporation established pursuant
to Subtitle A of Title IV of ERISA (or any successor).
          “Person”: an individual, partnership, corporation, limited liability
company, business trust, joint stock company, trust, unincorporated association,
joint venture, Governmental Authority or other entity of whatever nature.
          “Plan”: at a particular time, any employee benefit plan that is
covered by ERISA and in respect of which the Borrower or a Commonly Controlled
Entity is (or, if such plan were terminated at such time, would under
Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5)
of ERISA.
          “Prime Rate”: the rate of interest per annum publicly announced from
time to time by the Administrative Agent as its prime rate in effect at its
principal office in New York City (the Prime Rate not being intended to be the
lowest rate of interest charged by the Administrative Agent in connection with
extensions of credit to debtors).
          “Projections”: as defined in Section 6.2(c).
          “Properties”: as defined in Section 4.17(a).
          “Recovery Event”: any settlement of or payment in respect of any
property or casualty insurance claim or any condemnation proceeding relating to
any asset of any Group Member.
          “Refunded Swingline Loans”: as defined in Section 2.4.
          “Register”: as defined in Section 10.6(b).
          “Regulation U”: Regulation U of the Board as in effect from time to
time.
          “Reimbursement Obligation”: the obligation of the Borrower to
reimburse the Issuing Lender pursuant to Section 3.5 for amounts drawn under
Letters of Credit.

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          “Reinvestment Notice”: a written notice executed by a Responsible
Officer stating that the Borrower (directly or indirectly through a Subsidiary)
has, or intends and expects within 120 days of the date of an Asset Sale or
Recovery Event, to use all or a specified portion of the Net Cash Proceeds of
such Asset Sale or Recovery Event to acquire or repair assets useful in its
business.
          “Reorganization”: with respect to any Multiemployer Plan, the
condition that such plan is in reorganization within the meaning of Section 4241
of ERISA.
          “Reportable Event”: any of the events set forth in Section 4043(c) of
ERISA, other than those events as to which the thirty day notice period is
waived under subsections .27, .28, .29, .30, .31, .32, .34 or .35 of PBGC Reg.
§ 4043.
          “Required Lenders”: at any time, the holders of 60% or more of the
Total Revolving Commitments then in effect or, if the Revolving Commitments have
been terminated, the Total Revolving Extensions of Credit then outstanding;
provided that such holders shall at all times include at least three Lenders or,
if there are fewer than three Lenders, all Lenders.
          “Requirement of Law”: as to any Person, the Certificate of
Incorporation and By-Laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.
          “Responsible Officer”: the chief executive officer, president, general
counsel, treasurer or chief financial officer of the Borrower or Loral, but in
any event, with respect to financial matters, the chief financial officer or
treasurer of the Borrower or Loral.
          “Restricted Payments”: as defined in Section 7.6.
          “Revolving Commitment”: as to any Lender, the obligation of such
Lender, if any, to make Revolving Loans and participate in Swingline Loans and
Letters of Credit in an aggregate principal and/or face amount not to exceed the
amount set forth under the heading “Revolving Commitment” opposite such Lender’s
name on Schedule 1.1A or in the Assignment and Assumption pursuant to which such
Lender became a party hereto, as the same may be changed from time to time
pursuant to the terms hereof (including any increase in the Revolving
Commitments pursuant to Section 2.20). The original amount of the Total
Revolving Commitments is $100,000,000.
          “Revolving Commitment Increase Amount”: as defined in Section 2.20(a).
          “Revolving Commitment Increase Notice”: as defined in Section 2.20(a).
          “Revolving Commitment Period”: the period from and including the
Closing Date to the Revolving Termination Date.
          “Revolving Extensions of Credit”: as to any Lender at any time, an
amount equal to the sum of (a) the aggregate principal amount of all Revolving
Loans held by such Lender

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then outstanding, (b) such Lender’s Revolving Percentage of the L/C Obligations
then outstanding and (c) such Lender’s Revolving Percentage of the aggregate
principal amount of Swingline Loans then outstanding.
          “Revolving Loans”: as defined in Section 2.1(a).
          “Revolving Percentage”: as to any Lender at any time, the percentage
which such Lender’s Revolving Commitment then constitutes of the Total Revolving
Commitments or, at any time after the Revolving Commitments shall have expired
or terminated, the percentage which the aggregate principal amount of such
Lender’s Revolving Loans then outstanding constitutes of the aggregate principal
amount of the Revolving Loans then outstanding, provided, that, in the event
that the Revolving Loans are paid in full prior to the reduction to zero of the
Total Revolving Extensions of Credit, the Revolving Percentages shall be
determined in a manner designed to ensure that the other outstanding Revolving
Extensions of Credit shall be held by the Lenders on a comparable basis.
          “Revolving Termination Date”: October 16, 2011; provided that if
Lenders provide notice of termination of at least 50% of the Total Revolving
Commitments pursuant to Section 2.21, the Revolving Termination Date shall be
the date on which such termination becomes effective as provided in such
Section.
          “SEC”: the Securities and Exchange Commission, any successor thereto
and any analogous Governmental Authority.
          “Security Documents”: the collective reference to the Guarantee and
Collateral Agreement, the Holdings Pledge Agreement, the Mortgages and all other
security documents hereafter delivered to the Administrative Agent granting a
Lien on any property of any Person to secure the obligations and liabilities of
any Loan Party under any Credit Documents.
          “Single Employer Plan”: any Plan that is covered by Title IV of ERISA,
but that is not a Multiemployer Plan.
          “Solvent”: when used with respect to any Person, means that, as of any
date of determination, (a) the amount of the “present fair saleable value” of
the assets of such Person will, as of such date, exceed the amount of all
“liabilities of such Person, contingent or otherwise”, as of such date, as such
quoted terms are determined in accordance with applicable federal and state laws
governing determinations of the insolvency of debtors, (b) the present fair
saleable value of the assets of such Person will, as of such date, be greater
than the amount that will be required to pay the liability of such Person on its
debts as such debts become absolute and matured, (c) such Person will not have,
as of such date, an unreasonably small amount of capital with which to conduct
its business, and (d) such Person will be able to pay its debts as they mature.
For purposes of this definition, (i) “debt” means liability on a “claim”, and
(ii) “claim” means any (x) right to payment, whether or not such a right is
reduced to judgment, liquidated, unliquidated, fixed, contingent, matured,
unmatured, disputed, undisputed, legal, equitable, secured or unsecured or
(y) right to an equitable remedy for breach of performance if such breach gives
rise to a right to payment, whether or not such right to an equitable remedy is

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reduced to judgment, fixed, contingent, matured or unmatured, disputed,
undisputed, secured or unsecured.
          “Specified Cash Management Agreement”: any agreement providing for
treasury, depositary or cash management services, including in connection with
any automated clearing house transfers of funds or any similar transactions
between the Borrower or any Guarantor and any Lender or affiliate thereof.
          “Specified Swap Agreement”: any Swap Agreement in respect of interest
rates, currency exchange rates or commodity prices entered into by the Borrower
or any Guarantor and any Person that is a Lender or an affiliate of a Lender at
the time such Swap Agreement is entered into.
          “Spot Rate of Exchange”: with respect to any designated foreign
currency, at any date of determination thereof, the spot rate of exchange in
London that appears on the display page applicable to such designated foreign
currency on the Reuters System (or such other page as may replace such page for
the purpose of displaying the spot rate of exchange in London); provided that if
there shall at any time no longer exist such a page, the spot rate of exchange
shall be determined by reference to another similar rate publishing service
selected by the Administrative Agent and, if no such similar rate publishing
service is available, by reference to the published rate of the Administrative
Agent in effect at such date for similar commercial transactions.
          “Subsidiary”: as to any Person, a corporation, partnership, limited
liability company or other entity of which shares of stock or other ownership
interests having ordinary voting power (other than stock or such other ownership
interests having such power only by reason of the happening of a contingency) to
elect a majority of the board of directors or other managers of such
corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly through one
or more intermediaries, or both, by such Person. Unless otherwise qualified, all
references to a “Subsidiary” or to “Subsidiaries” in this Agreement shall refer
to a Subsidiary or Subsidiaries of the Borrower.
          “Swap Agreement”: any agreement with respect to any swap, forward,
future or derivative transaction or option or similar agreement involving, or
settled by reference to, one or more rates, currencies, commodities, equity or
debt instruments or securities, or economic, financial or pricing indices or
measures of economic, financial or pricing risk or value or any similar
transaction or any combination of these transactions; provided that no phantom
stock or similar plan providing for payments only on account of services
provided by current or former directors, officers, employees or consultants of
the Borrower or any of its Subsidiaries shall be a “Swap Agreement”.
          “Swingline Commitment”: the obligation of the Swingline Lender to make
Swingline Loans pursuant to Section 2.3 in an aggregate principal amount at any
one time outstanding not to exceed $10,000,000.

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          “Swingline Lender”: JPMorgan Chase Bank, N.A. in its capacity as the
lender of Swingline Loans.
          “Swingline Loans”: as defined in Section 2.3.
          “Swingline Participation Amount”: as defined in Section 2.4.
          “Syndication Agent”: as defined in the preamble hereto.
          “Title Insurance Company”: as defined in Section 5.1(k)
          “Total Revolving Commitments”: at any time, the aggregate amount of
the Revolving Commitments then in effect.
          “Total Revolving Extensions of Credit”: at any time, the aggregate
amount of the Revolving Extensions of Credit of the Lenders outstanding at such
time.
          “Transferee”: any Assignee or Participant.
          “Type”: as to any Loan, its nature as an ABR Loan or a Eurodollar
Loan.
          “United States”: the United States of America.
          “Unrestricted Cash and Cash Equivalents”: as of any date, cash and
Cash Equivalents of the Borrower and its Subsidiaries that would not, in
accordance with GAAP, be included in “other assets” (or any like caption) on a
consolidated balance sheet of the Borrower and its Subsidiaries as of such date.
          “Vendor Financing”: any financing specified on Schedule 1.1C or any
other financing provided by the Borrower or any of its Subsidiaries to any
customer in connection with its purchase from any Group Member of any satellite
or related assets.
          “Vendor Financing Receivables: any payments owing to the Borrower or
any of its Subsidiaries under any Vendor Financing.
          1.2 Other Definitional Provisions. (a) Unless otherwise specified
therein, all terms defined in this Agreement shall have the defined meanings
when used in the other Credit Documents or any certificate or other document
made or delivered pursuant hereto or thereto.
          (b) As used herein and in the other Credit Documents, and any
certificate or other document made or delivered pursuant hereto or thereto,
(i) accounting terms relating to any Group Member not defined in Section 1.1 and
accounting terms partly defined in Section 1.1, to the extent not defined, shall
have the respective meanings given to them under GAAP, (ii) the words “include”,
“includes” and “including” shall be deemed to be followed by the phrase “without
limitation”, (iii) the word “incur” shall be construed to mean incur, create,
issue, assume, become liable in respect of or suffer to exist (and the words
“incurred” and “incurrence” shall have correlative meanings), (iv) the words
“asset” and “property” shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, Capital Stock, securities, revenues, accounts, leasehold
interests and contract rights, and (v)

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references to agreements or other Contractual Obligations shall, unless
otherwise specified, be deemed to refer to such agreements or Contractual
Obligations as amended, supplemented, restated or otherwise modified from time
to time.
          (c) The words “hereof”, “herein” and “hereunder” and words of similar
import, when used in this Agreement, shall refer to this Agreement as a whole
and not to any particular provision of this Agreement, and Section, Schedule and
Exhibit references are to this Agreement unless otherwise specified.
          (d) The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.
SECTION 2. AMOUNT AND TERMS OF COMMITMENTS
          2.1. Revolving Commitments. (a) Subject to the terms and conditions
hereof, each Lender severally agrees to make revolving credit loans (“Revolving
Loans”) to the Borrower from time to time during the Revolving Commitment Period
in an aggregate principal amount at any one time outstanding which, when added
to such Lender’s Revolving Percentage of the sum of (i) the L/C Obligations then
outstanding and (ii) the aggregate principal amount of the Swingline Loans then
outstanding, does not exceed on any date the lesser of (A) such Lender’s
Revolving Commitment and (B) such Lender’s Revolving Percentage of (x) if the
Parent Guarantee is executed and delivered to the Administrative Agent on or
prior to January 14, 2009 (1) until such execution and delivery, $50,000,000 and
(2) thereafter, the Total Revolving Commitment and (y) if the Parent Guarantee
is not executed and delivered to the Administrative Agent on or prior to
January 14, 2009, at all times $50,000,000 (the amount applicable at any time
pursuant to the foregoing clause (x) or (y), as the same may be adjusted
pursuant to Section 2.21, the “Maximum Outstanding Amount” at such time).
References in the immediately preceding sentence to $50,000,000 shall not be
affected by any Revolving Commitment Increase Amount (except to the extent such
Revolving Commitment Increase Amount results in the Maximum Outstanding Amount
being reinstated to up to $50,000,000 following the termination of any Lender’s
Revolving Commitment pursuant to Section 2.21). During the Revolving Commitment
Period the Borrower may use the Revolving Commitments by borrowing, prepaying
the Revolving Loans in whole or in part, and reborrowing, all in accordance with
the terms and conditions hereof. The Revolving Loans may from time to time be
Eurodollar Loans or ABR Loans, as determined by the Borrower and notified to the
Administrative Agent in accordance with Sections 2.2 and 2.9.
          (b) The Borrower shall repay all outstanding Revolving Loans on the
Revolving Termination Date.
          2.2. Procedure for Revolving Loan Borrowing. The Borrower may borrow
under the Revolving Commitments during the Revolving Commitment Period on any
Business Day, provided that the Borrower shall give the Administrative Agent
irrevocable notice (which notice must be received by the Administrative Agent
prior to 11:00 A.M., New York City time, (a) three Business Days prior to the
requested Borrowing Date, in the case of Eurodollar Loans, or (b) one Business
Day prior to the requested Borrowing Date, in the case of ABR Loans (other than
Swingline Loans) (provided that any such notice of a borrowing of ABR Loans
under the

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Revolving Facility to finance payments required by Section 3.5 may be given not
later than 10:00 A.M., New York City time, on the date of the proposed
borrowing), specifying (i) the amount and Type of Revolving Loans to be
borrowed, (ii) the requested Borrowing Date and (iii) in the case of Eurodollar
Loans, the respective amounts of each such Type of Loan and the respective
lengths of the initial Interest Period therefor. Each borrowing under the
Revolving Commitments shall be in an amount equal to (x) in the case of ABR
Loans, $1,000,000 or a whole multiple thereof (or, if the then aggregate
Available Revolving Commitments are less than $1,000,000, such lesser amount)
and (y) in the case of Eurodollar Loans, $1,000,000 or a whole multiple of
$1,000,000 in excess thereof; provided, that the Swingline Lender may request,
on behalf of the Borrower, borrowings under the Revolving Commitments that are
ABR Loans in other amounts pursuant to Section 2.4. Upon receipt of any such
notice from the Borrower, the Administrative Agent shall promptly notify each
Lender thereof. Each Lender will make the amount of its pro rata share of each
borrowing available to the Administrative Agent for the account of the Borrower
at the Funding Office prior to 12:00 Noon, New York City time, on the Borrowing
Date requested by the Borrower in funds immediately available to the
Administrative Agent. Such borrowing will then be made available to the Borrower
by the Administrative Agent crediting the account of the Borrower on the books
of such office with the aggregate of the amounts made available to the
Administrative Agent by the Lenders and in like funds as received by the
Administrative Agent.
          2.3. Swingline Commitment. (a) Subject to the terms and conditions
hereof, the Swingline Lender agrees to make a portion of the credit otherwise
available to the Borrower under the Revolving Commitments from time to time
during the Revolving Commitment Period by making swing line loans (“Swingline
Loans”) to the Borrower; provided that (i) the aggregate principal amount of
Swingline Loans outstanding at any time shall not exceed the Swingline
Commitment then in effect (notwithstanding that the Swingline Loans outstanding
at any time, when aggregated with the Swingline Lender’s other outstanding
Revolving Loans, may exceed the Swingline Commitment then in effect) and
(ii) the Borrower shall not request, and the Swingline Lender shall not make,
any Swingline Loan if, after giving effect to the making of such Swingline Loan,
the aggregate principal amount of the Swingline Loans outstanding, when added to
the sum of (x) the L/C Obligations then outstanding and (y) the aggregate
principal amount of the Revolving Loans then outstanding, would exceed the
Maximum Outstanding Amount. During the Revolving Commitment Period, the Borrower
may use the Swingline Commitment by borrowing, repaying and reborrowing, all in
accordance with the terms and conditions hereof. Swingline Loans shall be ABR
Loans only.
          (b) The Borrower shall repay to the Swingline Lender the then unpaid
principal amount of each Swingline Loan on the earlier of the Revolving
Termination Date and the first date after such Swingline Loan is made that is
the 15th or last day of a calendar month and is at least five Business Days
after such Swingline Loan is made; provided that on each date that a Revolving
Loan is borrowed, the Borrower shall repay all Swingline Loans then outstanding.
          2.4. Procedure for Swingline Borrowing; Refunding of Swingline Loans.
(a) Whenever the Borrower desires that the Swingline Lender make Swingline Loans
it shall give the Swingline Lender irrevocable telephonic notice confirmed
promptly in writing (which telephonic notice must be received by the Swingline
Lender not later than 1:00 P.M., New York

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City time, on the proposed Borrowing Date), specifying (i) the amount to be
borrowed and (ii) the requested Borrowing Date (which shall be a Business Day
during the Revolving Commitment Period). Each borrowing under the Swingline
Commitment shall be in an amount equal to $500,000 or a whole multiple of
$100,000 in excess thereof. Not later than 3:00 P.M., New York City time, on the
Borrowing Date specified in a notice in respect of Swingline Loans, the
Swingline Lender shall make available to the Administrative Agent at the Funding
Office an amount in immediately available funds equal to the amount of the
Swingline Loan to be made by the Swingline Lender. The Administrative Agent
shall make the proceeds of such Swingline Loan available to the Borrower on such
Borrowing Date by depositing such proceeds in the account of the Borrower with
the Administrative Agent on such Borrowing Date in immediately available funds.
          (b) The Swingline Lender, at any time and from time to time in its
sole and absolute discretion may, on behalf of the Borrower (which hereby
irrevocably directs the Swingline Lender to act on its behalf), on one Business
Day’s notice given by the Swingline Lender no later than 12:00 Noon, New York
City time, request each Lender to make, and each Lender hereby agrees to make, a
Revolving Loan, in an amount equal to such Lender’s Revolving Percentage of the
aggregate amount of the Swingline Loans (the “Refunded Swingline Loans”)
outstanding on the date of such notice, to repay the Swingline Lender. Each
Lender shall make the amount of such Revolving Loan available to the
Administrative Agent at the Funding Office in immediately available funds, not
later than 10:00 A.M., New York City time, one Business Day after the date of
such notice. The proceeds of such Revolving Loans shall be immediately made
available by the Administrative Agent to the Swingline Lender for application by
the Swingline Lender to the repayment of the Refunded Swingline Loans. The
Borrower irrevocably authorizes the Swingline Lender to charge the Borrower’s
accounts with the Administrative Agent (up to the amount available in each such
account) in order to immediately pay the amount of such Refunded Swingline Loans
to the extent amounts received from the Lenders are not sufficient to repay in
full such Refunded Swingline Loans.
          (c) If prior to the time a Revolving Loan would have otherwise been
made pursuant to Section 2.4(b), one of the events described in Section 8(g)
shall have occurred and be continuing with respect to the Borrower or if for any
other reason, as determined by the Swingline Lender in its sole discretion,
Revolving Loans may not be made as contemplated by Section 2.4(b), each Lender
shall, on the date such Revolving Loan was to have been made pursuant to the
notice referred to in Section 2.4(b), purchase for cash an undivided
participating interest in the then outstanding Swingline Loans by paying to the
Swingline Lender an amount (the “Swingline Participation Amount”) equal to
(i) such Lender’s Revolving Percentage times (ii) the sum of the aggregate
principal amount of Swingline Loans then outstanding that were to have been
repaid with such Revolving Loans.
          (d) Whenever, at any time after the Swingline Lender has received from
any Lender such Lender’s Swingline Participation Amount, the Swingline Lender
receives any payment on account of the Swingline Loans, the Swingline Lender
will distribute to such Lender its Swingline Participation Amount (appropriately
adjusted, in the case of interest payments, to reflect the period of time during
which such Lender’s participating interest was outstanding and funded and, in
the case of principal and interest payments, to reflect such Lender’s pro rata
portion of such payment if such payment is not sufficient to pay the principal
of and interest on

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all Swingline Loans then due); provided, however, that in the event that such
payment received by the Swingline Lender is required to be returned, such Lender
will return to the Swingline Lender any portion thereof previously distributed
to it by the Swingline Lender.
          (e) Each Lender’s obligation to make the Loans referred to in
Section 2.4(b) and to purchase participating interests pursuant to
Section 2.4(c) shall be absolute and unconditional and shall not be affected by
any circumstance, including (i) any setoff, counterclaim, recoupment, defense or
other right that such Lender or the Borrower may have against the Swingline
Lender, the Borrower or any other Person for any reason whatsoever, (ii) the
occurrence or continuance of a Default or an Event of Default or the failure to
satisfy any of the other conditions specified in Section 5, (iii) any adverse
change in the condition (financial or otherwise) of the Borrower, (iv) any
breach of this Agreement or any other Credit Documents by the Borrower, any
other Loan Party or any other Lender or (v) any other circumstance, happening or
event whatsoever, whether or not similar to any of the foregoing.
          2.5. Commitment Fees, etc. (a) The Borrower agrees to pay to the
Administrative Agent for the account of each Lender a commitment fee for the
period from and including the date hereof to the last day of the Revolving
Commitment Period, computed at the Commitment Fee Rate on the average daily
amount of the Available Revolving Commitment of such Lender during the period
for which payment is made, payable quarterly in arrears on each Fee Payment
Date, commencing on the first such date to occur after the date hereof.
          (b) The Borrower agrees to pay to the Administrative Agent the fees in
the amounts and on the dates as set forth in any fee agreements with the
Administrative Agent and to perform any other obligations contained therein.
          2.6. Termination or Reduction of Revolving Commitments. The Borrower
shall have the right, upon not less than three Business Days’ notice to the
Administrative Agent, to terminate the Revolving Commitments or, from time to
time, to reduce the amount of the Revolving Commitments; provided that no such
termination or reduction of Revolving Commitments shall be permitted if, after
giving effect thereto and to any prepayments of the Revolving Loans and
Swingline Loans made on the effective date thereof, the Total Revolving
Extensions of Credit would exceed the Total Revolving Commitments. Any such
reduction shall be in an amount equal to $1,000,000, or a whole multiple
thereof, and shall reduce permanently the Revolving Commitments then in effect.
          2.7. Optional Prepayments. The Borrower may at any time and from time
to time prepay the Loans, in whole or in part, without premium or penalty, upon
notice delivered to the Administrative Agent no later than 11:00 A.M., New York
City time, three Business Days prior thereto, in the case of Eurodollar Loans,
and no later than 11:00 A.M., New York City time, one Business Day prior
thereto, in the case of ABR Loans, which notice shall specify the date and
amount of prepayment and whether the prepayment is of Eurodollar Loans or ABR
Loans; provided, that if a Eurodollar Loan is prepaid on any day other than the
last day of the Interest Period applicable thereto, the Borrower shall also pay
any amounts owing pursuant to Section 2.17. Upon receipt of any such notice the
Administrative Agent shall promptly notify each relevant Lender thereof. If any
such notice is given, the amount specified in such notice shall be due and
payable on the date specified therein, together with (except in the case of

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Revolving Loans that are ABR Loans and Swingline Loans) accrued interest to such
date on the amount prepaid. Partial prepayments of Revolving Loans shall be in
an aggregate principal amount of $1,000,000 or a whole multiple thereof. Partial
prepayments of Swingline Loans shall be in an aggregate principal amount of
$100,000 or a whole multiple thereof.
          2.8. Mandatory Prepayments. (a) If on any date the Total Revolving
Extensions of Credit exceed the Maximum Outstanding Amount, within five Business
Days thereafter the Borrower shall make a prepayment of the Loans in an amount
sufficient to reduce such excess (after giving effect to any other reduction in
the Total Revolving Extensions of Credit) to zero, in accordance with the
procedures set forth in Section 2.7.
          (b) Except as set forth in clause (c) below, if on any date any Group
Member shall receive Net Cash Proceeds from any Asset Sale or Recovery Event
then, unless a Reinvestment Notice shall be delivered in respect thereof, such
Net Cash Proceeds shall be applied within 75 days of such date toward the
prepayment of the Loans.
          (c) If one or more Group Members shall receive aggregate Net Cash
Proceeds from one or more Dispositions, if any, of a type described in
Section 7.5(g), (h) or (i) in excess of $100,000,000, then all such Net Cash
Proceeds in excess of such $100,000,000 (the “Asset Sale Excess Proceeds”) shall
be applied within 75 days after receipt thereof to prepay principal of the
Loans, and the Revolving Commitments shall be permanently reduced
dollar-for-dollar by the amount of such Asset Sale Excess Proceeds immediately
upon the receipt of such proceeds.
          2.9. Conversion and Continuation Options. (a) The Borrower may elect
from time to time to convert Eurodollar Loans to ABR Loans by giving the
Administrative Agent prior irrevocable notice of such election no later than
11:00 A.M., New York City time, on the Business Day preceding the proposed
conversion date, provided that any such conversion of Eurodollar Loans may only
be made on the last day of an Interest Period with respect thereto. The Borrower
may elect from time to time to convert ABR Loans to Eurodollar Loans by giving
the Administrative Agent prior irrevocable notice of such election no later than
11:00 A.M., New York City time, on the third Business Day preceding the proposed
conversion date (which notice shall specify the length of the initial Interest
Period therefor), provided that no ABR Loan may be converted into a Eurodollar
Loan when any Event of Default has occurred and is continuing and the
Administrative Agent has determined in its or their sole discretion not to
permit such conversions. Upon receipt of any such notice the Administrative
Agent shall promptly notify each relevant Lender thereof.
          (b) Any Eurodollar Loan may be continued as such upon the expiration
of the then current Interest Period with respect thereto by the Borrower giving
irrevocable notice to the Administrative Agent, in accordance with the
applicable provisions of the term “Interest Period” set forth in Section 1.1, of
the length of the next Interest Period to be applicable to such Loans, provided
that no Eurodollar Loan may be continued as such when any Event of Default of a
type specified in Section 8(a), 8(c) or 8(g) or an Event of Default as a result
of any non-compliance with Section 6.1(a) or (b) has occurred and is continuing
and the Administrative Agent has determined in its or their sole discretion not
to permit such continuations, and provided, further, that if the Borrower shall
fail to give any required notice as described above in this paragraph or if such
continuation is not permitted pursuant to the preceding proviso such Loans shall
be

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automatically converted to ABR Loans on the last day of such then expiring
Interest Period. Upon receipt of any such notice the Administrative Agent shall
promptly notify each relevant Lender thereof.
          2.10. Limitations on Eurodollar Tranches. Notwithstanding anything to
the contrary in this Agreement, all borrowings, conversions and continuations of
Eurodollar Loans and all selections of Interest Periods shall be in such amounts
and be made pursuant to such elections so that, (a) after giving effect thereto,
the aggregate principal amount of the Eurodollar Loans comprising each
Eurodollar Tranche shall be equal to $1,000,000 or a whole multiple of
$1,000,000 in excess thereof and (b) no more than ten Eurodollar Tranches shall
be outstanding at any one time.
          2.11. Interest Rates and Payment Dates. (a) Each Eurodollar Loan shall
bear interest for each day during each Interest Period with respect thereto at a
rate per annum equal to the Eurodollar Rate determined for such day plus the
Applicable Margin.
          (b) Each ABR Loan shall bear interest at a rate per annum equal to the
ABR plus the Applicable Margin:
          (c) (i) If all or a portion of the principal amount of any Loan or
Reimbursement Obligation shall not be paid when due (whether at the stated
maturity, by acceleration or otherwise), all outstanding Loans and Reimbursement
Obligations (whether or not overdue) shall bear interest at a rate per annum
equal to (x) in the case of the Loans, the rate that would otherwise be
applicable thereto pursuant to the foregoing provisions of this Section plus 2%
or (y) in the case of Reimbursement Obligations, the rate applicable to ABR
Loans under the Revolving Facility plus 2%, and (ii) if all or a portion of any
interest payable on any Loan or Reimbursement Obligation or any commitment fee
or other amount payable hereunder shall not be paid when due (whether at the
stated maturity, by acceleration or otherwise), such overdue amount shall bear
interest at a rate per annum equal to the rate then applicable to ABR Loans plus
2%, in each case, with respect to clauses (i) and (ii) above, from the date of
such non-payment until such amount is paid in full (as well after as before
judgment).
          (d) Interest shall be payable in arrears on each Interest Payment
Date, provided that interest accruing pursuant to paragraph (c) of this Section
shall be payable from time to time on demand.
          2.12. Computation of Interest and Fees. (a) Interest and fees payable
pursuant hereto shall be calculated on the basis of a 360-day year for the
actual days elapsed, except that, with respect to ABR Loans the rate of interest
on which is calculated on the basis of the Prime Rate, the interest thereon
shall be calculated on the basis of a 365- (or 366-, as the case may be) day
year for the actual days elapsed. The Administrative Agent shall as soon as
practicable notify the Borrower and the relevant Lenders of each determination
of a Eurodollar Rate. Any change in the interest rate on a Loan resulting from a
change in the ABR or the Eurocurrency Reserve Requirements shall become
effective as of the opening of business on the day on which such change becomes
effective. The Administrative Agent shall as soon as practicable notify the
Borrower and the relevant Lenders of the effective date and the amount of each
such change in interest rate.

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          (b) Each determination of an interest rate by the Administrative Agent
pursuant to any provision of this Agreement shall be conclusive and binding on
the Borrower and the Lenders in the absence of manifest error. The
Administrative Agent shall, at the request of the Borrower, deliver to the
Borrower a statement showing the quotations used by the Administrative Agent in
determining any interest rate pursuant to Section 2.11(a).
          2.13. Inability to Determine Interest Rate. If prior to the first day
of any Interest Period:
          (a) the Administrative Agent shall have determined (which
determination shall be conclusive and binding upon the Borrower) that, by reason
of circumstances affecting the relevant market, adequate and reasonable means do
not exist for ascertaining the Eurodollar Rate for such Interest Period, or
          (b) the Administrative Agent shall have received notice from the
Required Lenders that the Eurodollar Rate determined or to be determined for
such Interest Period will not adequately and fairly reflect the cost to such
Lenders (as conclusively certified by such Lenders) of making or maintaining
their affected Loans during such Interest Period, the Administrative Agent shall
give telecopy or telephonic notice thereof to the Borrower and the relevant
Lenders as soon as practicable thereafter. If such notice is given and during
the period prior to its withdrawal (x) any Eurodollar Loans requested to be made
on the first day of such Interest Period shall be made as ABR Loans, (y) any
Loans that were to have been converted on the first day of such Interest Period
to Eurodollar Loans shall be continued as ABR Loans and (z) any outstanding
Eurodollar Loans shall be converted, on the last day of the then-current
Interest Period, to ABR Loans. Until such notice has been withdrawn by the
Administrative Agent, no further Eurodollar Loans shall be made or continued as
such, nor shall the Borrower have the right to convert Loans to Eurodollar
Loans.
          2.14. Pro Rata Treatment and Payments. (a) Except as provided in
Section 2.21, each borrowing by the Borrower from the Lenders hereunder, each
payment by the Borrower on account of any commitment fee and any reduction of
the Commitments of the Lenders shall be made pro rata according to the Revolving
Percentages of the Lenders.
          (b) Except as provided in Section 2.21, each payment (including each
prepayment) by the Borrower on account of principal of and interest on the
Revolving Loans shall be made pro rata according to the respective outstanding
principal amounts of the Revolving Loans then held by the Lenders.
          (c) All payments (including prepayments) to be made by the Borrower
hereunder, whether on account of principal, interest, fees or otherwise, shall
be made without setoff or counterclaim and shall be made prior to 12:00 Noon,
New York City time, on the due date thereof to the Administrative Agent, for the
account of the Lenders, at the Funding Office (or, in the case of payments of
reimbursement obligations in respect of Letters of Credit, as specified in
Section 3.5), in Dollars (or, in the case of a reimbursement obligation then
denominated in Pounds Sterling, euros or Yen, the currency thereof) and in
immediately available funds. The Administrative Agent shall distribute such
payments to each relevant Lender promptly upon receipt in like funds as
received, net of any amounts owing by such

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Lender pursuant to Section 9.7. If any payment hereunder (other than payments on
the Eurodollar Loans) becomes due and payable on a day other than a Business
Day, such payment shall be extended to the next succeeding Business Day. If any
payment on a Eurodollar Loan becomes due and payable on a day other than a
Business Day, the maturity thereof shall be extended to the next succeeding
Business Day unless the result of such extension would be to extend such payment
into another calendar month, in which event such payment shall be made on the
immediately preceding Business Day. In the case of any extension of any payment
of principal pursuant to the preceding two sentences, interest thereon shall be
payable at the then applicable rate during such extension.
          (d) Unless the Administrative Agent shall have been notified in
writing by any Lender prior to a borrowing that such Lender will not make the
amount that would constitute its share of such borrowing available to the
Administrative Agent, the Administrative Agent may assume that such Lender is
making such amount available to the Administrative Agent, and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. If such amount is not made available to the Administrative
Agent by the required time on the Borrowing Date therefor, such Lender shall pay
to the Administrative Agent, on demand, such amount with interest thereon, at a
rate equal to the greater of (i) the Federal Funds Effective Rate and (ii) a
rate determined by the Administrative Agent in accordance with banking industry
rules on interbank compensation, for the period until such Lender makes such
amount immediately available to the Administrative Agent. A certificate of the
Administrative Agent submitted to any Lender with respect to any amounts owing
under this paragraph shall be conclusive in the absence of manifest error. If
such Lender’s share of such borrowing is not made available to the
Administrative Agent by such Lender within three Business Days after such
Borrowing Date, the Administrative Agent shall also be entitled to recover such
amount with interest thereon at the rate per annum applicable to ABR Loans, on
demand, from the Borrower and the applicable Loan shall be reduced by the amount
of such payment (exclusive of interest). If the Borrower returns to the
Administrative Agent any amount with interest thereon as described in the
immediately preceding sentence, such Lender shall indemnify the Borrower for the
difference, if any, between (i) the aggregate interest paid by the Borrower to
the Administrative Agent in accordance with the immediately preceding sentence
less (ii) if less, the aggregate interest which actually accrued on such amount
in accordance with the provisions hereof prior to its return to the
Administrative Agent.
          (e) Unless the Administrative Agent shall have been notified in
writing by the Borrower prior to the date of any payment due to be made by the
Borrower hereunder that the Borrower will not make such payment to the
Administrative Agent, the Administrative Agent may assume that the Borrower is
making such payment, and the Administrative Agent may, but shall not be required
to, in reliance upon such assumption, make available to the Lenders their
respective pro rata shares of a corresponding amount. If such payment is not
made to the Administrative Agent by the Borrower within three Business Days
after such due date, the Administrative Agent shall be entitled to recover, on
demand, from each Lender to which any amount which was made available pursuant
to the preceding sentence, such amount with interest thereon at the rate per
annum equal to the daily average Federal Funds Effective Rate. Nothing herein
shall be deemed to limit the rights of the Administrative Agent or any Lender
against the Borrower.

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          2.15. Requirements of Law. (a) If the adoption of or any change in any
Requirement of Law or in the interpretation or application thereof or compliance
by any Lender with any request or directive (whether or not having the force of
law) from any central bank or other Governmental Authority made subsequent to
the date hereof:
     (i) shall subject any Lender to any tax of any kind whatsoever with respect
to this Agreement, any Letter of Credit, any Application or any Eurodollar Loan
made by it, or change the basis of taxation of payments to such Lender in
respect thereof (except for Non-Excluded Taxes covered by Section 2.16 and
changes in the rate of tax on the overall net income of such Lender);
     (ii) shall impose, modify or hold applicable any reserve, special deposit,
compulsory loan or similar requirement against assets held by, deposits or other
liabilities in or for the account of, advances, loans or other extensions of
credit by, or any other acquisition of funds by, any office of such Lender that
is not otherwise included in the determination of the Eurodollar Rate; or
     (iii) shall impose on such Lender any other condition; and the result of
any of the foregoing is to increase the cost to such Lender, by an amount that
such Lender deems to be material, of making, converting into, continuing or
maintaining Eurodollar Loans or issuing or participating in Letters of Credit,
or to reduce any amount receivable hereunder in respect thereof, then, in any
such case, the Borrower shall pay such Lender, within 10 days after its demand,
any additional amounts necessary to compensate such Lender for such increased
cost or reduced amount receivable. If any Lender becomes entitled to claim any
additional amounts pursuant to this paragraph, it shall promptly notify the
Borrower (with a copy to the Administrative Agent) of the event by reason of
which it has become so entitled.
          (b) If any Lender shall have determined that the adoption of or any
change in any Requirement of Law regarding capital adequacy or in the
interpretation or application thereof or compliance by such Lender or any
corporation controlling such Lender with any request or directive regarding
capital adequacy (whether or not having the force of law) from any Governmental
Authority made subsequent to the date hereof shall have the effect of reducing
the rate of return on such Lender’s or such corporation’s capital as a
consequence of its obligations hereunder or under or in respect of any Letter of
Credit to a level below that which such Lender or such corporation could have
achieved but for such adoption, change or compliance (taking into consideration
such Lender’s or such corporation’s policies with respect to capital adequacy)
by an amount deemed by such Lender to be material, then from time to time and
within 10 days after submission by such Lender to the Borrower (with a copy to
the Administrative Agent) of a written request therefor, the Borrower shall pay
to such Lender such additional amount or amounts as will compensate such Lender
or such corporation for such reduction.
          (c) A certificate in reasonable detail setting forth the calculation
of the additional amounts, if any, payable pursuant to this Section submitted by
any Lender to the Borrower (with a copy to the Administrative Agent) shall be
conclusive in the absence of manifest error. Notwithstanding anything to the
contrary in this Section, the Borrower shall not be required to compensate a
Lender pursuant to this Section for any amounts incurred more than

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nine months prior to the date that such Lender notifies the Borrower of such
Lender’s intention to claim compensation therefor; provided that, if the
circumstances giving rise to such claim have a retroactive effect, then such
nine-month period shall be extended to include the period of such retroactive
effect. The obligations of the Borrower pursuant to this Section shall survive
the termination of this Agreement and the payment of the Loans and all other
amounts payable hereunder.
          2.16. Taxes. (a) All payments made by the Borrower under this
Agreement shall be made free and clear of, and without deduction or withholding
for or on account of, any present or future income, stamp or other taxes,
levies, imposts, duties, charges, fees, deductions or withholdings, now or
hereafter imposed, levied, collected, withheld or assessed by any Governmental
Authority, excluding net income taxes and franchise taxes (imposed in lieu of
net income taxes) imposed on the Administrative Agent or any Lender as a result
of a present or former connection between the Administrative Agent or such
Lender and the jurisdiction of the Governmental Authority imposing such tax or
any political subdivision or taxing authority thereof or therein (other than any
such connection arising solely from the Administrative Agent or such Lender
having executed, delivered or performed its obligations or received a payment
under, or enforced, this Agreement or any other Credit Documents). If any such
non-excluded taxes, levies, imposts, duties, charges, fees, deductions or
withholdings (“Non-Excluded Taxes”) or Other Taxes are required to be withheld
from any amounts payable to the Administrative Agent or any Lender hereunder,
the amounts so payable to the Administrative Agent or such Lender shall be
increased to the extent necessary to yield to the Administrative Agent or such
Lender (after payment of all Non-Excluded Taxes and Other Taxes) interest or any
such other amounts payable hereunder at the rates or in the amounts specified in
this Agreement, provided, however, that the Borrower shall not be required to
increase any such amounts payable to any Lender with respect to any Non-Excluded
Taxes (i) that are attributable to such Lender’s failure to comply with the
requirements of paragraph (d) or (e) of this Section or (ii) that are United
States withholding taxes imposed on amounts payable to such Lender at the time
such Lender becomes a party to this Agreement, except to the extent that such
Lender’s assignor (if any) was entitled, at the time of assignment, to receive
additional amounts from the Borrower with respect to such Non-Excluded Taxes
pursuant to this paragraph.
          (b) In addition, the Borrower shall pay any Other Taxes to the
relevant Governmental Authority in accordance with applicable law.
          (c) Whenever any Non-Excluded Taxes or Other Taxes are payable by the
Borrower, as promptly as possible thereafter the Borrower shall send to the
Administrative Agent for its own account or for the account of the relevant
Lender, as the case may be, a certified copy of an original official receipt
received by the Borrower showing payment thereof. If the Borrower fails to pay
any Non-Excluded Taxes or Other Taxes when due to the appropriate taxing
authority or fails to remit to the Administrative Agent the required receipts or
other required documentary evidence, the Borrower shall indemnify the
Administrative Agent and the Lenders for any incremental taxes, interest or
penalties that may become payable by the Administrative Agent or any Lender as a
result of any such failure provided such failure is not attributable to such
Lender’s failure to comply with the requirements of paragraph (d) or (e) of this
Section.

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          (d) Each Lender (or Transferee) that is not a “U.S. Person” as defined
in Section 7701(a)(30) of the Code (a “Non-U.S. Lender”) shall deliver to the
Borrower and the Administrative Agent (or, in the case of a Participant, to the
Lender from which the related participation shall have been purchased) two
copies of either U.S. Internal Revenue Service Form W-8BEN or Form W-8ECI, or,
in the case of a Non-U.S. Lender claiming exemption from U.S. federal
withholding tax under Section 871(h) or 881(c) of the Code with respect to
payments of “portfolio interest”, a statement substantially in the form of
Exhibit H and a Form W-8BEN, or any subsequent versions thereof or successors
thereto, properly completed and duly executed by such Non-U.S. Lender claiming
complete exemption from, or a reduced rate of, U.S. federal withholding tax on
all payments by the Borrower under this Agreement and the other Credit
Documents. Such forms shall be delivered by each Non-U.S. Lender on or before
the date it becomes a party to this Agreement (or, in the case of any
Participant, on or before the date such Participant purchases the related
participation). In addition, each Non-U.S. Lender shall deliver such forms
promptly upon the obsolescence or invalidity of any form previously delivered by
such Non-U.S. Lender. Each Non-U.S. Lender shall promptly notify the Borrower at
any time it determines that it is no longer in a position to provide any
previously delivered certificate to the Borrower (or any other form of
certification adopted by the U.S. taxing authorities for such purpose).
Notwithstanding any other provision of this paragraph, a Non-U.S. Lender shall
not be required to deliver any form pursuant to this paragraph that such
Non-U.S. Lender is not legally able to deliver.
          (e) A Lender that is entitled to an exemption from or reduction of
non-U.S. withholding tax under the law of the jurisdiction in which the Borrower
is located, or any treaty to which such jurisdiction is a party, with respect to
payments under this Agreement shall deliver to the Borrower (with a copy to the
Administrative Agent), at the time or times prescribed by applicable law or
reasonably requested by the Borrower, such properly completed and executed
documentation prescribed by applicable law as will permit such payments to be
made without withholding or at a reduced rate, provided that such Lender is
legally entitled to complete, execute and deliver such documentation and in such
Lender’s judgment such completion, execution or submission would not materially
prejudice the legal position of such Lender.
          (f) If the Administrative Agent or any Lender determines, in its sole
discretion, that it has received a refund of any Non-Excluded Taxes or Other
Taxes as to which it has been indemnified by the Borrower or with respect to
which the Borrower has paid additional amounts pursuant to this Section 2.16, it
shall pay over such refund to the Borrower (but only to the extent of indemnity
payments made, or additional amounts paid, by the Borrower under this
Section 2.16 with respect to the Non-Excluded Taxes or Other Taxes giving rise
to such refund), net of all out-of-pocket expenses of the Administrative Agent
or such Lender and without interest (other than any interest paid by the
relevant Governmental Authority with respect to such refund); provided, that the
Borrower, upon the request of the Administrative Agent or such Lender, agrees to
repay the amount paid over to the Borrower (plus any penalties, interest or
other charges imposed by the relevant Governmental Authority) to the
Administrative Agent or such Lender in the event the Administrative Agent or
such Lender is required to repay such refund to such Governmental Authority.
This paragraph shall not be construed to require the Administrative Agent or any
Lender to make available its tax returns (or any other information relating to
its taxes which it deems confidential) to the Borrower or any other Person.

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          (g) The agreements in this Section shall survive the termination of
this Agreement and the payment of the Loans and all other amounts payable
hereunder.
          2.17. Indemnity. The Borrower agrees to indemnify each Lender for, and
to hold each Lender harmless from, any loss or expense that such Lender may
sustain or incur as a consequence of (a) default by the Borrower in making a
borrowing of, conversion into or continuation of Eurodollar Loans after the
Borrower has given a notice requesting the same in accordance with the
provisions of this Agreement, (b) default by the Borrower in making any
prepayment of or conversion from Eurodollar Loans after the Borrower has given a
notice thereof in accordance with the provisions of this Agreement or (c) the
making of a prepayment of Eurodollar Loans on a day that is not the last day of
an Interest Period with respect thereto. Such indemnification may include an
amount equal to the excess, if any, of (i) the amount of interest that would
have accrued on the amount so prepaid, or not so borrowed, converted or
continued, for the period from the date of such prepayment or of such failure to
borrow, convert or continue to the last day of such Interest Period (or, in the
case of a failure to borrow, convert or continue, the Interest Period that would
have commenced on the date of such failure) in each case at the applicable rate
of interest for such Loans provided for herein (excluding, however, the
Applicable Margin included therein, if any) over (ii) the amount of interest (as
reasonably determined by such Lender) that would have accrued to such Lender on
such amount by placing such amount on deposit for a comparable period with
leading banks in the interbank eurodollar market. A certificate as to any
amounts payable pursuant to this Section submitted to the Borrower by any Lender
shall be conclusive in the absence of manifest error. This covenant shall
survive the termination of this Agreement and the payment of the Loans and all
other amounts payable hereunder.
          2.18. Change of Lending Office. Each Lender agrees that, upon the
occurrence of any event giving rise to the operation of Section 2.15 or 2.16(a)
with respect to such Lender, it will, if requested by the Borrower, use
reasonable efforts (subject to overall policy considerations of such Lender) to
designate another lending office for any Loans affected by such event with the
object of avoiding the consequences of such event; provided, that such
designation is made on terms that, in the sole judgment of such Lender, cause
such Lender and its lending office(s) to suffer no economic, legal or regulatory
disadvantage, and provided, further, that nothing in this Section shall affect
or postpone any of the obligations of the Borrower or the rights of any Lender
pursuant to Section 2.15 or 2.16(a).
          2.19. Replacement of Lenders. The Borrower shall be permitted to
replace any Lender that (a) requests reimbursement for amounts owing pursuant to
Section 2.15 or 2.16(a), (b) defaults in its obligation to make Loans hereunder,
with a replacement financial institution, or (c) does not consent to any
proposed amendment, supplement, modification, consent or waiver of any provision
of this Agreement or any other Credit Documents that requires the consent of
each of the Lenders or each of the Lenders affected thereby (so long as the
consent of the Required Lenders has been obtained); provided that (i) such
replacement does not conflict with any Requirement of Law, (ii) no Event of
Default shall have occurred and be continuing at the time of such replacement,
(iii) prior to any such replacement, such Lender shall have taken no action
under Section 2.18 so as to eliminate the continued need for payment of amounts
owing pursuant to Section 2.15 or 2.16(a), (iv) the replacement financial
institution shall purchase, at par, all Loans and other amounts owing to such
replaced Lender on or prior to the date of replacement,

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(v) the Borrower shall be liable to such replaced Lender under Section 2.16 if
any Eurodollar Loan owing to such replaced Lender shall be purchased other than
on the last day of the Interest Period relating thereto, (vi) the replacement
financial institution shall be reasonably satisfactory to the Administrative
Agent, (vii) the replaced Lender shall be obligated to make such replacement in
accordance with the provisions of Section 10.6 (provided that the Borrower shall
be obligated to pay the registration and processing fee referred to therein),
(viii) until such time as such replacement shall be consummated, the Borrower
shall pay all additional amounts (if any) required pursuant to Section 2.15 or
2.16(a), as the case may be, and (ix) any such replacement shall not be deemed
to be a waiver of any rights that the Borrower, the Administrative Agent or any
other Lender shall have against the replaced Lender.
          2.20. Revolving Credit Commitment Increases. (a) In the event that the
Borrower wishes to increase the Total Revolving Commitments at any time or from
time to time after the Closing Date, it shall notify the Administrative Agent in
writing of the amount (the “Revolving Commitment Increase Amount”) of such
proposed increase (such notice, a “Revolving Commitment Increase Notice”);
provided that the conditions in Section 5.2 are satisfied as of the date of any
such increase. Each Revolving Commitment Increase Notice shall specify which
Lenders and/or other banks, financial institutions or other entities (each of
which shall be subject to the consent of the Administrative Agent, such consent
not to be unreasonably withheld) the Borrower desires to provide such Revolving
Commitment Increase Amount.
          (b) Any additional bank, financial institution or other entity which
the Borrower selects to offer participation in any increased Total Revolving
Commitments and which agrees to become a party to this Agreement and provide a
Revolving Commitment shall execute a New Lender Supplement with the Borrower and
the Administrative Agent, substantially in the form of Exhibit J-1, whereupon
such bank, financial institution or other entity (herein called a “New Lender”)
shall become a Lender for all purposes and to the same extent as if originally a
party hereto and shall be bound by and entitled to the benefits of this
Agreement, provided that the Revolving Commitment of any such New Lender shall
be in an amount not less than $5,000,000.
          (c) Any Lender or New Lender which agrees to increase its Revolving
Commitment shall, in each case, execute a Commitment Increase Supplement with
the Borrower and the Administrative Agent, substantially in the form of
Exhibit J-2, whereupon such Lender or New Lender shall be bound by and entitled
to the benefits of this Agreement with respect to the full amount of its
Revolving Commitment as so increased or new Revolving Commitment, as the case
may be, which shall in any event be on the terms, and subject to the conditions,
of the other Revolving Commitments.
          (d) On any Increase Effective Date pursuant to Section 2.20, (i) each
bank, financial institution or other entity that is a New Lender pursuant to
Section 2.20(b) or any Lender which has increased its Revolving Commitment
pursuant to Section 2.20(c) shall make available to the Administrative Agent
such amounts in immediately available funds as the Administrative Agent shall
determine, for the benefit of the other relevant Lenders, as being required in
order to cause, after giving effect to such increase and the use of such amounts
to make payments to such other relevant Lenders, each Lender’s portion of the
outstanding Revolving Loans of all the Lenders to be equal to its Revolving
Percentage of such outstanding

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Revolving Loans, (ii) the Borrower shall be deemed to have repaid and reborrowed
all outstanding Revolving Loans as of the date of any increase in the Revolving
Commitments (with such reborrowing to consist of the Types of Loans, with
related Interest Periods if applicable, specified in a notice delivered by the
Borrower in accordance with the requirements of Section 2.2) and (iii) risk
participations in outstanding Letters of Credit shall be adjusted to reflect
revised Revolving Commitments. The deemed payments made pursuant to clause (ii)
of the immediately preceding sentence in respect of each Eurodollar Loan shall
be subject to indemnification by the Borrower pursuant to the provisions of
Section 2.17 if the deemed payment occurs other than on the last day of the
related Interest Periods.
          (e) Notwithstanding anything to the contrary in this Section 2.20(e),
(i) in no event shall any transaction effected pursuant to this Section 2.20(e)
cause the sum of Total Revolving Commitments to exceed $125,000,000, (ii) no
Lender shall have any obligation to increase its Revolving Credit Commitment
unless it agrees to do so in its sole discretion and (iii) the upfront fees and
other equivalent amounts paid by or on behalf of the Borrower to the New Lenders
or Lenders in respect of any Revolving Commitment Increase Amount provided by
such New Lenders or Lenders (calculated on a basis that amortizes such upfront
fees and other equivalent amounts over the remaining term of the Revolving
Commitments) shall not be greater than the upfront fees and other equivalent
amounts paid in respect of the original Revolving Commitments (as amortized over
the original term of the Revolving Commitments).
          (f) The Administrative Agent shall receive on or prior to each
Increase Effective Date, for the benefit of the Lenders, (i) a legal opinion of
counsel to the Borrower in the form attached hereto as Exhibit G-1 and
(ii) certified copies of resolutions of the Borrower authorizing such Revolving
Commitment Increase Amount.
          2.21. Optional Termination by a Lender. Notwithstanding any other
provision hereof to the contrary, if the Parent Guarantee is not executed and
delivered to the Administrative Agent on or prior to January 14, 2009, with
written notice thereof to be provided by the Borrower to the Administrative
Agent and each Lender pursuant to Section 6.2(g), any Lender may terminate all
or a portion of its Revolving Commitment by giving written notice of such
termination to the Administrative Agent within 10 Business Days of such date.
The Administrative Agent shall promptly notify the Borrower and each other
Lender of its receipt of any such notice. Any such termination shall be
effective as of the date 30 Business Days after January 14, 2009. Prior to the
effectiveness of any such termination of the Revolving Commitment or portion
thereof of a Lender, the Borrower shall be permitted to replace such Lender with
a replacement financial institution (which may be another Lender) that will not
terminate such Revolving Commitment or portion thereof, provided that the
requirements of the proviso to Section 2.19 (to the extent relevant) are
satisfied with respect to such replacement (as though such requirements applied
to such replacement). Upon any termination of the Revolving Commitment or
portion thereof (such subsequent clauses (a), (b), (c) and (d) to reflect such
relevant portion) of any Lender becoming effective pursuant to this Section,
(a) the Loans owing to such Lender shall become due and payable, together with
any accrued interest thereon and any other amounts then accrued for the benefit
of or owing to such Lender hereunder (including accrued commitment fees and
amounts payable under Section 2.17), (b) the Total Commitments, the Revolving
Percentages and the Maximum Outstanding Amount shall be adjusted to reflect the
Revolving Commitments of the remaining Lenders, (c) any Swingline Loans then

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outstanding shall become due and payable, together with accrued interest
thereon, and (d) to the extent that, after giving effect to the adjustments
referred to in clause (b) above and any concurrent prepayments of the Revolving
Loans, the L/C Obligations, when added to the aggregate principal amount of the
continuing Revolving Loans, would exceed the Maximum Outstanding Amount, the
Borrower shall cash collateralize such excess in a manner reasonably
satisfactory to the Issuing Lender.
SECTION 3. LETTERS OF CREDIT
          3.1. L/C Commitment. (a) Subject to the terms and conditions hereof,
the Issuing Lender, in reliance on the agreements of the other Lenders set forth
in Section 3.4(a), agrees to issue letters of credit (“Letters of Credit”) for
the account of the Borrower on any Business Day during the Revolving Commitment
Period in such form as may be approved from time to time by the Issuing Lender;
provided that the Issuing Lender shall have no obligation to issue any Letter of
Credit if, after giving effect to such issuance, (i) the L/C Obligations would
exceed the L/C Commitment or (ii) the L/C Obligations, when added to the
aggregate principal amount of the Revolving Loans and Swingline Loans then
outstanding, would exceed the Maximum Outstanding Amount. Each Letter of Credit
shall (i) be denominated in Dollars, Pounds Sterling, euros or Yen and
(ii) expire no later than the earlier of (x) the first anniversary of its date
of issuance and (y) the date that is five Business Days prior to the Revolving
Termination Date, provided that any Letter of Credit with a one-year term may
provide for the renewal thereof for additional one-year periods (which shall in
no event extend beyond the date referred to in clause (y) above).
          (b) The Issuing Lender shall not at any time be obligated to issue any
Letter of Credit if such issuance would conflict with, or cause the Issuing
Lender or any L/C Participant to exceed any limits imposed by, any applicable
Requirement of Law.
          (c) Letters of credit issued and outstanding on the Closing Date under
the Amended and Restated Letter of Credit Reimbursement Agreement, dated as of
November 21, 2005, between the Borrower and JPMorgan Chase Bank, N.A. (the
“Existing Reimbursement Agreement”) shall become Letters of Credit issued
hereunder for the account of the Borrower on the Closing Date.
          3.2 Procedure for Issuance of Letter of Credit. The Borrower may from
time to time request that the Issuing Lender issue a Letter of Credit by
delivering to the Issuing Lender at its address for notices specified herein an
Application therefor, completed to the satisfaction of the Issuing Lender, and
such other certificates, documents and other papers and information as the
Issuing Lender may request. Upon receipt of any Application, the Issuing Lender
will process such Application and the certificates, documents and other papers
and information delivered to it in connection therewith in accordance with its
customary procedures and shall promptly issue the Letter of Credit requested
thereby (but in no event shall the Issuing Lender be required to issue any
Letter of Credit earlier than three Business Days after its receipt of the
Application therefor and all such other certificates, documents and other papers
and information relating thereto) by issuing the original of such Letter of
Credit to the beneficiary thereof or as otherwise may be agreed to by the
Issuing Lender and the Borrower. The Issuing Lender shall furnish a copy of such
Letter of Credit to the Borrower promptly following the

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issuance thereof. The Issuing Lender shall promptly furnish to the
Administrative Agent, which shall in turn promptly furnish to the Lenders,
notice of the issuance of each Letter of Credit (including the amount thereof).
          3.3 Fees and Other Charges. (a) The Borrower will pay a fee on all
outstanding Letters of Credit at a per annum rate equal to the Applicable Margin
then in effect with respect to Eurodollar Loans under the Revolving Facility,
shared ratably among the Lenders and payable quarterly in arrears on each Fee
Payment Date after the issuance date. In addition, the Borrower shall pay to the
Issuing Lender for its own account a fronting fee as agreed with the Issuing
Lender on the undrawn and unexpired amount of each Letter of Credit, payable
quarterly in arrears on each Fee Payment Date after the issuance date.
          (b) In addition to the foregoing fees, the Borrower shall pay or
reimburse the Issuing Lender for such normal and customary costs and expenses as
are incurred or charged by the Issuing Lender in issuing, negotiating, effecting
payment under, amending or otherwise administering any Letter of Credit.
          3.4 L/C Participations. (a) The Issuing Lender irrevocably agrees to
grant and hereby grants to each L/C Participant, and, to induce the Issuing
Lender to issue Letters of Credit, each L/C Participant irrevocably agrees to
accept and purchase and hereby accepts and purchases from the Issuing Lender, on
the terms and conditions set forth below, for such L/C Participant’s own account
and risk an undivided interest equal to such L/C Participant’s Revolving
Percentage in the Issuing Lender’s obligations and rights under and in respect
of each Letter of Credit and the amount of each draft paid by the Issuing Lender
thereunder. Each L/C Participant agrees with the Issuing Lender that, if a draft
is paid under any Letter of Credit for which the Issuing Lender is not
reimbursed in full by the Borrower in accordance with the terms of this
Agreement, such L/C Participant shall pay to the Issuing Lender upon demand
(which demand, in the case of any demand made in respect of any draft under a
Letter of Credit denominated in a currency other than Dollars, shall not be made
prior to the date that the amount of such draft has been converted into Dollars
in accordance with Section 3.5) at the Issuing Lender’s address for notices
specified herein an amount equal to such L/C Participant’s Revolving Percentage
of the amount of such draft, or any part thereof, that is not so reimbursed.
Each L/C Participant’s obligation to pay such amount shall be absolute and
unconditional and shall not be affected by any circumstance, including (i) any
setoff, counterclaim, recoupment, defense or other right that such L/C
Participant may have against the Issuing Lender, the Borrower or any other
Person for any reason whatsoever, (ii) the occurrence or continuance of a
Default or an Event of Default or the failure to satisfy any of the other
conditions specified in Section 5, (iii) any adverse change in the condition
(financial or otherwise) of the Borrower, (iv) any breach of this Agreement or
any other Credit Documents by the Borrower, any other Loan Party or any other
L/C Participant or (v) any other circumstance, happening or event whatsoever,
whether or not similar to any of the foregoing.
          (b) If any amount required to be paid by any L/C Participant to the
Issuing Lender pursuant to Section 3.4(a) in respect of any unreimbursed portion
of any payment made by the Issuing Lender under any Letter of Credit is paid to
the Issuing Lender within three Business Days after the date such payment is
due, such L/C Participant shall pay to the Issuing Lender on demand an amount
equal to the product of (i) such amount, times (ii) the daily average Federal
Funds Effective Rate during the period from and including the date such payment
is required to the date on which such payment is immediately available to the
Issuing Lender, times (iii) a fraction the numerator of which is the number of
days that elapse during such period and the denominator of which is 360. If any
such amount required to be paid by any L/C Participant pursuant to
Section 3.4(a) is not made available to the Issuing Lender by such L/C
Participant within three Business Days after the date such payment

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is due, the Issuing Lender shall be entitled to recover from such L/C
Participant, on demand, such amount with interest thereon calculated from such
due date at the rate per annum applicable to ABR Loans under the Revolving
Facility. A certificate of the Issuing Lender submitted to any L/C Participant
with respect to any amounts owing under this Section shall be conclusive in the
absence of manifest error.
          (c) Whenever, at any time after the Issuing Lender has made payment
under any Letter of Credit and has received from any L/C Participant its pro
rata share of such payment in accordance with Section 3.4(a), the Issuing Lender
receives any payment related to such Letter of Credit (whether directly from the
Borrower or otherwise, including proceeds of collateral applied thereto by the
Issuing Lender), or any payment of interest on account thereof, the Issuing
Lender will distribute to such L/C Participant its pro rata share thereof;
provided, however, that in the event that any such payment received by the
Issuing Lender shall be required to be returned by the Issuing Lender, such L/C
Participant shall return to the Issuing Lender the portion thereof previously
distributed by the Issuing Lender to it.
          3.5. Reimbursement Obligation of the Borrower. If any draft is paid
under any Letter of Credit, the Borrower shall reimburse the Issuing Lender for
the amount of (a) the draft so paid and (b) any taxes, fees, charges or other
costs or expenses incurred by the Issuing Lender in connection with such
payment, not later than 12:00 Noon, New York City time (or such other relevant
local time as is specified by the Issuing Lender in respect of such Letter of
Credit), on (i) the Business Day next succeeding the Business Day that the
Borrower receives notice of such draft, if such notice is received on such day
prior to 10:00 A.M., New York City time (or such other relevant local time), or
(ii) if clause (i) above does not apply, the second Business Day immediately
following the day that the Borrower receives such notice. Each such payment
shall be made to the Issuing Lender at the address as specified by it from time
to time in respect of such Letter of Credit in the currency in which such draft
is payable (except that, in the case of any Letter of Credit denominated in any
currency other than Dollars, upon notice by the Issuing Lender to the Borrower,
such payment shall be made in Dollars from and after the date on which the
amount of such payment shall have been converted into Dollars at the Spot Rate
of Exchange on such date of conversion, which date of conversion may be any
Business Day after the date on which such payment is due) and in immediately
available funds. Interest shall be payable on any such amounts from the date on
which the relevant draft is paid until payment in full at the rate set forth in
(x) until the Business Day next succeeding the date of the relevant notice,
Section 2.11(b) and (y) thereafter, Section 2.11(c); provided that if any such
amount is denominated in a currency other than Dollars for any period, such
interest shall be payable for such period at the rate charged by the Issuing
Lender for reimbursement of overdue obligations in such currency owing by
account parties with similar credit profiles to that of the Borrower.
          3.6. Obligations Absolute. The Borrower’s obligations under this
Section 3 shall be absolute and unconditional under any and all circumstances
and irrespective of any setoff, counterclaim or defense to payment that the
Borrower may have or have had against the Issuing Lender, any beneficiary of a
Letter of Credit or any other Person. The Borrower also agrees with the Issuing
Lender that the Issuing Lender shall not be responsible for, and the Borrower’s
Reimbursement Obligations under Section 3.5 shall not be affected by, among
other things, the validity or genuineness of documents or of any endorsements
thereon, even though such documents shall in fact prove to be invalid,
fraudulent or forged, or any dispute between or

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among the Borrower and any beneficiary of any Letter of Credit or any other
party to which such Letter of Credit may be transferred or any claims whatsoever
of the Borrower against any beneficiary of such Letter of Credit or any such
transferee. The Issuing Lender shall not be liable for any error, omission,
interruption or delay in transmission, dispatch or delivery of any message or
advice, however transmitted, in connection with any Letter of Credit, except for
errors or omissions found by a final and nonappealable decision of a court of
competent jurisdiction to have resulted from the gross negligence, intentional
breach or willful misconduct of the Issuing Lender. The Borrower agrees that any
action taken or omitted by the Issuing Lender under or in connection with any
Letter of Credit or the related drafts or documents, if done in the absence of
gross negligence, or intentional breach or willful misconduct, shall be binding
on the Borrower and shall not result in any liability of the Issuing Lender to
the Borrower.
          3.7. Letter of Credit Payments. If any draft shall be presented for
payment under any Letter of Credit, the Issuing Lender shall promptly notify the
Borrower of the date and amount thereof. The responsibility of the Issuing
Lender to the Borrower in connection with any draft presented for payment under
any Letter of Credit shall, in addition to any payment obligation expressly
provided for in such Letter of Credit, be limited to determining that the
documents (including each draft) delivered under such Letter of Credit in
connection with such presentment are substantially in conformity with such
Letter of Credit.
          3.8. Applications. To the extent that any provision of any Application
related to any Letter of Credit is inconsistent with the provisions of this
Section 3, the provisions of this Section 3 shall apply.
SECTION 4. REPRESENTATIONS AND WARRANTIES
          To induce the Administrative Agent and the Lenders to enter into this
Agreement and to make the Loans and issue or participate in the Letters of
Credit, the Borrower hereby represents and warrants to the Administrative Agent
and each Lender that:
          4.1. Financial Condition. (a) The audited consolidated balance sheets
of Loral and its Subsidiaries as at December 31, 2006 and December 31, 2007, and
the related consolidated statements of income and of cash flows for the fiscal
years ended on such dates, reported on by and accompanied by an unqualified
report from Deloitte & Touche LLP, present fairly the consolidated financial
condition of Loral as at such date, and the consolidated results of its
operations and its consolidated cash flows for the respective fiscal years then
ended. The audited consolidated balance sheets of the Borrower and its
Subsidiaries as at December 31, 2006 and December 31, 2007, and the related
consolidated statements of income and of cash flows for the fiscal years ended
on such dates, reported on by and accompanied by an unqualified report from
Deloitte & Touche LLP, present fairly the consolidated financial condition of
the Borrower as at such date, and the consolidated results of its operations and
its consolidated cash flows for the respective fiscal years then ended. The
unaudited consolidated balance sheet of Loral and its Subsidiaries as at
March 31, 2008, and the related unaudited consolidated statements of income and
cash flows for the three-month period ended on such date, present fairly the
consolidated financial condition of Loral as at such date, and the consolidated
results of its operations and its consolidated cash flows for the three-month
period then ended (subject to

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normal year-end audit adjustments). All of the foregoing financial statements,
including the related schedules and notes thereto where required, have been
prepared in accordance with GAAP applied consistently throughout the periods
involved (except as disclosed therein). The unaudited consolidated balance sheet
of the Borrower and its Subsidiaries as at March 31, 2008, and the related
unaudited consolidated statements of income and cash flows for the three-month
period ended on such date, present fairly the consolidated financial condition
of the Borrower as at such date, and the consolidated results of its operations
and its consolidated cash flows for the three-month period then ended, subject
to normal year-end audit adjustment and before recognition of the effects of
income taxes. During the period from December 31, 2007 to and including the date
hereof there has been no Disposition by any Group Member of any material part of
its business or property except as permitted by this Agreement.
          4.2 No Change. Since December 31, 2007, there has been no development
or event that has had or could reasonably be expected to have a Material Adverse
Effect.
          4.3. Existence; Compliance with Law. Each Group Member (a) is duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization, (b) has the power and authority, and the legal
right, to own and operate its property, to lease the property it operates as
lessee and to conduct the business in which it is currently engaged, (c) is duly
qualified as a foreign corporation or other organization and in good standing
under the laws of each jurisdiction where its ownership, lease or operation of
property or the conduct of its business requires such qualification except where
failure to so qualify could not reasonably be expected to have a Material
Adverse Effect and (d) is in compliance with all Requirements of Law except to
the extent that the failure to comply therewith could not, in the aggregate,
reasonably be expected to have a Material Adverse Effect.
          4.4. Power; Authorization; Enforceable Obligations. Each Loan Party
has the power and authority, and the legal right, to make, deliver and perform
the Credit Documents to which it is a party and, in the case of the Borrower, to
obtain extensions of credit hereunder. Each Loan Party has taken all necessary
organizational action to authorize the execution, delivery and performance of
the Credit Documents to which it is a party and, in the case of the Borrower, to
authorize the extensions of credit on the terms and conditions of this
Agreement. No consent or authorization of, filing with, notice to or other act
by or in respect of, any Governmental Authority or any other Person is required
in connection with the extensions of credit hereunder or with the execution,
delivery, performance, validity or enforceability of this Agreement or any of
the Credit Documents, except (i) consents, authorizations, filings and notices
described in Schedule 4.4, which consents, authorizations, filings and notices
have been obtained or made and are in full force and effect and (ii) the filings
referred to in Section 4.19. The Credit Documents has been duly executed and
delivered on behalf of each Loan Party party thereto. This Agreement
constitutes, and other Credit Documents upon execution will constitute, a legal,
valid and binding obligation of each Loan Party party thereto, enforceable
against each such Loan Party in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors’ rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).
          4.5 No Legal Bar. The execution, delivery and performance of this
Agreement and the other Credit Documents, the issuance of Letters of Credit, the
borrowings hereunder and the use of the proceeds thereof will not violate any
Requirement of Law or any effective Contractual Obligation of any Group Member
and will not

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result in, or require, the creation or imposition of any Lien on any of their
respective properties or revenues pursuant to any Requirement of Law or any such
Contractual Obligation (other than the Liens created by the Security Documents).
          4.6 Litigation. No litigation, investigation or proceeding of or
before any arbitrator or Governmental Authority is pending or, to the knowledge
of the Borrower, threatened by or against any Group Member or against any of
their respective properties or revenues (a) with respect to any of the Credit
Documents or any of the transactions contemplated hereby or thereby, or (b) that
could reasonably be expected to have a Material Adverse Effect.
          4.7. No Default. No Group Member has received a written notice of
default under or with respect to any of its Contractual Obligations from the
counterparty thereto that could reasonably be expected to have a Material
Adverse Effect. No Default or Event of Default has occurred and is continuing.
          4.8. Ownership of Property; Liens. Each Group Member has title in fee
simple to, or a valid leasehold interest in, all its real property, and good
title to, or a valid leasehold interest in, all its other property, and none of
such property is subject to any Lien except as permitted by Section 7.3.
          4.9 Intellectual Property. Each Group Member owns, or is licensed to
use, all Intellectual Property necessary for the conduct of its business as
currently conducted except for those which the failure to own or license could
not be reasonably expected to have a Material Adverse Effect. No claim has been
asserted and is pending by any Person challenging or questioning the use,
ownership, validity or enforceability of any Intellectual Property, nor does the
Borrower know of any valid basis for any such claim except for any such claim
which could not be reasonably expected to have a Material Adverse Effect. The
use of Intellectual Property by each Group Member does not infringe on the
rights of any Person except for such claims and infringements that, in
aggregate, do not have a Material Adverse Effect.
          4.10. Taxes. Each Group Member has filed or caused to be filed all
Federal, state and other material tax returns that are required to be filed and
has paid all taxes shown to be due and payable on said returns or on any
assessments made against it or any of its property and all other taxes, fees or
other charges imposed on it or any of its property by any Governmental Authority
(other than any the amount or validity of which are currently being contested in
good faith by appropriate proceedings and with respect to which reserves in
conformity with GAAP have been provided on the books of the relevant Group
Member); no tax Lien has been filed, and, to the knowledge of the Borrower, no
claim is being asserted, with respect to any such tax, fee or other charge.
          4.11 Federal Regulations. No part of the proceeds of any Loans, and no
other extensions of credit hereunder, will be used (a) for “buying” or
“carrying” any “margin stock” within the respective meanings of each of the
quoted terms under Regulation U as now and from time to time hereafter in effect
for any purpose that violates the provisions of the Regulations of the Board or
(b) for any purpose that violates the provisions of the Regulations of the
Board. If requested by any Lender or the Administrative Agent, the Borrower will
furnish to the Administrative Agent and each Lender a statement to the foregoing
effect in conformity with the requirements of FR Form G-3 or FR Form U-1, as
applicable, referred to in Regulation U.
          4.12 Labor Matters. Except as, in the aggregate, could not reasonably
be expected to have a Material Adverse Effect: (a) there are no strikes or other
labor disputes against any Group Member pending or, to the knowledge of the
Borrower, threatened; (b) hours worked by and payment made to employees of each
Group Member have not been in violation of the Fair Labor

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Standards Act or any other applicable Requirement of Law dealing with such
matters; and (c) all payments due from any Group Member on account of employee
health and welfare insurance have been paid or accrued as a liability on the
books of the relevant Group Member.
          4.13 ERISA. Except as set forth on Schedule 4.13, neither a Reportable
Event nor a failure to satisfy the “minimum funding standards”(within the
meaning of Section 412 of the Code or Section 302 of ERISA) has occurred during
the five-year period prior to the date on which this representation is made or
deemed made with respect to any Single Employer Plan, and each Plan (other than
a Multiemployer Plan) has complied in all material respects with the applicable
provisions of ERISA and the Code. No termination of a Single Employer Plan has
occurred, and no Lien in favor of the PBGC or a Single Employer Plan has arisen,
during such five-year period. As of December 31, 2007, the present value of all
accrued benefits under each Single Employer Plan, based on the actuarial report
prepared by the Plan’s actuary with respect to such Plan for purposes of
financial accounting standards (FAS 87), exceeded the value of the assets of
such Plan allocable to such accrued benefits by approximately $69,300,000, and
since such date there has been no material adverse change in the accrued benefit
obligations or the fair market value of the assets of such Plan other than
changes attributable to general fluctuations affecting U.S. or global financial
markets. Neither the Borrower nor any Commonly Controlled Entity has had a
complete or partial withdrawal from any Multiemployer Plan that has resulted or
could reasonably be expected to result in a material liability under ERISA, and
neither the Borrower nor any Commonly Controlled Entity would become subject to
any material liability under ERISA if the Borrower or any such Commonly
Controlled Entity were to withdraw completely from all Multiemployer Plans as of
the valuation date most closely preceding the date on which this representation
is made or deemed made. No such Multiemployer Plan is in Reorganization or
Insolvent.
          4.14 Investment Company Act; Other Regulations. No Loan Party is an
“investment company”, or a company “controlled” by an “investment company”,
within the meaning of the Investment Company Act of 1940, as amended. No Loan
Party is subject to regulation under any Requirement of Law (other than
Regulation X of the Board) that limits its ability to incur Indebtedness.
          4.15 Subsidiaries. Except as disclosed to the Administrative Agent by
the Borrower in writing from time to time after the Closing Date, (a)
Schedule 4.15 sets forth the name and jurisdiction of incorporation of each
Subsidiary, whether such Subsidiary is an Immaterial Subsidiary and, as to each
such Subsidiary, the percentage of each class of Capital Stock owned by any Loan
Party and (b) there are no outstanding subscriptions, options, warrants, calls,
rights or other agreements or commitments (other than stock options granted to
employees or directors and directors’ qualifying shares) of any nature relating
to any Capital Stock of the Borrower or any Subsidiary, except as created by the
Credit Documents.
          4.16 Use of Proceeds. The proceeds of the Loans, and the Letters of
Credit, shall be used to finance the working capital needs and for general
corporate purposes of the Borrower and its Subsidiaries.
          4.17 Environmental Matters. Except to the extent that the facts and
circumstances giving rise to any failure to be so true and correct could not
reasonably be expected to have a Material Adverse Effect:
          (a) the facilities and properties owned, leased or operated by any
Group Member (the “Properties”) do not contain, and have not previously
contained, any Materials of Environmental Concern in amounts or concentrations
or under circumstances that constitute or constituted a violation of, or could
give rise to liability under, any Environmental Law;
          (b) no Group Member has received or is aware of any notice of
violation, alleged violation, non-compliance, liability or potential liability
regarding environmental matters or compliance with Environmental Laws with
regard to any of the Properties or the business

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operated by any Group Member (the “Business”), nor does the Borrower have
knowledge or reason to believe that any such notice will be received or is being
threatened;
          (c) Materials of Environmental Concern have not been transported or
disposed of from the Properties in violation of, or in a manner or to a location
that could give rise to liability under, any Environmental Law, nor have any
Materials of Environmental Concern been generated, treated, stored or disposed
of at, on or under any of the Properties in violation of, or in a manner that
could give rise to liability under, any applicable Environmental Law;
          (d) no judicial proceeding or governmental or administrative action is
pending or, to the knowledge of the Borrower, threatened, under any
Environmental Law to which any Group Member is or will be named as a party with
respect to the Properties or the Business, nor are there any consent decrees or
other decrees, consent orders, administrative orders or other orders, or other
administrative or judicial requirements outstanding under any Environmental Law
with respect to the Properties or the Business;
          (e) there has been no release or threat of release of Materials of
Environmental Concern at or from the Properties, or arising from or related to
the operations of any Group Member in connection with the Properties or
otherwise in connection with the Business, in violation of or in amounts or in a
manner that could give rise to liability under Environmental Laws;
          (f) the Properties and all operations at the Properties are in
compliance, and have in the last five years been in compliance, with all
applicable Environmental Laws, and there is no contamination at, under or about
the Properties or violation of any Environmental Law with respect to the
Properties or the Business; and
          (g) no Group Member has assumed any liability of any other Person
under Environmental Laws.
          4.18 Accuracy of Information, etc. No statement or information
contained in this Agreement, any Credit Documents, the Confidential Information
Memorandum or any other document, certificate or statement furnished by or on
behalf of any Loan Party to the Administrative Agent or the Lenders, or any of
them, for use in connection with the transactions contemplated by this Agreement
or the other Credit Documents, when taken as a whole, contained as of the date
such statement, information, document or certificate was so furnished (or, in
the case of the Confidential Information Memorandum, as of the date of this
Agreement), any untrue statement of a material fact or omitted to state a
material fact necessary to make the statements contained herein or therein not
misleading. The projections contained in the materials referenced above are
based upon good faith estimates and assumptions believed by management of the
Borrower to be reasonable at the time made, it being recognized by the Lenders
that such financial information as it relates to future events is not to be
viewed as fact and that actual results during the period or periods covered by
such financial information may differ from the projected results set forth
therein by a material amount. As of the Closing Date, there is no fact known to
any Loan Party that could reasonably be expected to have a Material Adverse
Effect that has not been expressly disclosed herein, in the other Credit
Documents, in the Confidential Information Memorandum or in any other documents,
certificates and statements furnished to the

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Administrative Agent and the Lenders for use in connection with the transactions
contemplated hereby and by the other Credit Documents.
          4.19 Security Documents. (a) The Guarantee and Collateral Agreement is
effective to create in favor of the Administrative Agent, for the benefit of the
Lenders, a legal, valid and enforceable security interest in the Collateral
described therein and proceeds thereof. In the case of the Pledged Stock
described in the Guarantee and Collateral Agreement, when stock certificates
representing such Pledged Stock are delivered to the Administrative Agent
together with undated stock powers, in blank, executed and delivered by a duly
authorized officer of the relevant Group Member, and in the case of the other
Collateral described in the Guarantee and Collateral Agreement in which a
security interest can be perfected by filing under the Uniform Commercial Code,
when financing statements and other filings specified on Schedule 4.19(a) in
appropriate form are filed in the offices specified on Schedule 4.19(a), the
Guarantee and Collateral Agreement shall constitute a fully perfected Lien on,
and security interest in, all right, title and interest of the Loan Parties in
such Collateral and the proceeds thereof, as security for the Obligations (as
defined in the Guarantee and Collateral Agreement), in each case prior and
superior in right to any other Person (except, in the case of Collateral other
than Pledged Stock, Liens permitted by Section 7.3).
          (b) Each of the Mortgages is effective to create in favor of the
Administrative Agent, for the benefit of the Lenders, a legal, valid and
enforceable Lien on the Mortgaged Properties described therein and proceeds
thereof, and when the Mortgages are filed in the offices specified on
Schedule 4.19(b), each such Mortgage shall constitute a fully perfected Lien on,
and security interest in, all right, title and interest of the Loan Parties in
the Mortgaged Properties and the proceeds thereof, as security for the
Obligations (as defined in the relevant Mortgage), in each case prior and
superior in right to any other Person. Schedule 1.1B lists, as of the Closing
Date, each parcel of owned real property and each leasehold interest in real
property located in the United States and held by the Borrower or any of its
Subsidiaries.
          4.20 Solvency. As of the Closing Date, the Borrower is, and after
giving effect to the incurrence of all Indebtedness and obligations being
incurred in connection herewith on the Closing Date will be Solvent.
          4.21 Regulation H. Except as disclosed in the standard flood hazard
determination prepared by LandAmerica lender Services on June 27, 2008, no
Mortgage encumbers improved real property that is located in an area that has
been identified by the Secretary of Housing and Urban Development as an area
having special flood hazards and in which flood insurance has been made
available under the National Flood Insurance Act of 1968.
          4.22 Senior Indebtedness. The principal, interest and fees payable
hereunder will constitute senior indebtedness (or the equivalent) of the
Borrower under any subordinated debt agreement or indenture entered into by the
Borrower.
SECTION 5. CONDITIONS PRECEDENT
          5.1 Conditions to Initial Extension of Credit. The agreement of each
Lender to make the initial extension of credit requested to be made by it is
subject to the satisfaction, prior to or concurrently with the making of such
extension of credit on the Closing Date, of the following conditions precedent:
          (a) Credit Agreement; Guarantee and Collateral Agreement; Holdings
Pledge Agreement. The Administrative Agent shall have received (i) this
Agreement, executed and delivered by the Administrative Agent, the Borrower and
each Person listed on Schedule 1.1A, (ii) the Guarantee and Collateral
Agreement, executed and delivered by the Borrower and each Guarantor, (iii) an
Acknowledgement and Consent in the form attached to the Guarantee and Collateral
Agreement, executed and delivered by each Issuer (as defined therein), if any,
that is not a Loan Party and (iv) the Holdings Pledge Agreement, executed and
delivered

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by Holdings.
     (b) Transactions. The following transactions shall have been consummated,
in each case on terms and conditions reasonably satisfactory to the Lenders:
     (i) the Borrower shall have received a new equity contribution in cash of
not less than $50,000,000 from Holdings subsequent to August 15, 2008, on terms
and subject to conditions reasonably satisfactory to the Administrative Agent;
and
     (ii) the Administrative Agent shall have received satisfactory evidence
that (i) the commitments under the Existing Reimbursement Agreement and all
other revolving credit facilities of the Borrower shall have been terminated and
all amounts thereunder shall have been paid in full (it being understood that
letters of credit issued and outstanding on the Closing Date under the Existing
Reimbursement Agreement shall have become Letters of Credit hereunder) and
(ii) satisfactory arrangements shall have been made for the termination of all
Liens granted in connection therewith.
     (c) Financial Statements. The Lenders shall have received (i) audited
consolidated financial statements of Loral and its Subsidiaries for the
December 31, 2006 and December 31, 2007 fiscal years, (ii) audited consolidated
financial statements of the Borrower and its Subsidiaries for the December 31,
2006 and December 31, 2007 fiscal years, (iii) unaudited interim consolidated
financial statements of Loral and its Subsidiaries for the fiscal quarters ended
March 31, 2008 and June 30, 2008; and (iv) preliminary unaudited interim
consolidated financial statements of the Borrower and its Subsidiaries for the
fiscal quarters ended March 31, 2008 and June 30, 2008 (excluding any notes with
respect thereto).
     (d) Approvals. All governmental and third party approvals necessary in
connection with the continuing operations of the Group Members and the
transactions contemplated hereby shall have been obtained and be in full force
and effect.
     (e) Lien Searches. The Administrative Agent shall have received the results
of a recent lien search in each of the jurisdictions where assets of the
Borrower and its Subsidiaries are located, and such search shall reveal no
material liens on any of the assets of the Borrower or its Subsidiaries except
for liens permitted by Section 7.3 or discharged on or prior to the Closing Date
pursuant to documentation reasonably satisfactory to the Administrative Agent.
     (f) Fees. The Lenders and the Administrative Agent shall have received all
fees required to be paid, and all expenses for which invoices have been
presented (including the reasonable fees and expenses of legal counsel), on or
before the Closing Date. All such amounts will be reflected in the funding
instructions given by the Borrower to the Administrative Agent on or before the
Closing Date.
     (g) Closing Certificate; Certified Certificate of Incorporation; Good
Standing Certificates. The Administrative Agent shall have received (i) a
certificate of each Loan

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Party, dated the Closing Date, substantially in the form of Exhibit D, with
appropriate insertions and attachments, including the certificate of
incorporation of each Loan Party that is a corporation certified by the relevant
authority of the jurisdiction of organization of such Loan Party, and (ii) a
long form good standing certificate for each Loan Party from its jurisdiction of
organization.
     (h) Legal Opinions. The Administrative Agent shall have received the
following executed legal opinions:
     (i) the legal opinion of Willkie Farr & Gallagher LLP, counsel to the
Borrower and its Subsidiaries, substantially in the form of Exhibit G-1;
     (ii) the legal opinion of Julie Bannerman, general counsel of the Borrower
and its Subsidiaries, substantially in the form of Exhibit G-2; and
     (iii) the legal opinion of Heller Ehrman LLP, local counsel of the Borrower
in California and of such other special and local counsel as may be required by
the Administrative Agent, substantially in the form of Exhibit G-3.
Each such legal opinion shall cover such other matters incident to the
transactions contemplated by this Agreement as the Administrative Agent may
reasonably require.
     (i) Pledged Stock; Stock Powers; Pledged Notes. The Administrative Agent
shall have received (i) the certificates representing the shares of Capital
Stock pledged pursuant to the Guarantee and Collateral Agreement and the
Holdings Pledge Agreement, together with an undated stock power for each such
certificate executed in blank by a duly authorized officer of the pledgor
thereof and (ii) each promissory note (if any) pledged to the Administrative
Agent pursuant to the Guarantee and Collateral Agreement endorsed (without
recourse) in blank (or accompanied by an executed transfer form in blank) by the
pledgor thereof.
     (j) Filings, Registrations and Recordings. Each document (including any
Uniform Commercial Code financing statement) required by the Security Documents
or under law or reasonably requested by the Administrative Agent to be filed,
registered or recorded in order to create in favor of the Administrative Agent,
for the benefit of the Lenders, a perfected Lien on the Collateral described
therein, prior and superior in right to any other Person (other than with
respect to Liens expressly permitted by Section 7.3), shall be in proper form
for filing, registration or recordation.
     (k) Mortgages, etc. (i) The Administrative Agent shall have received a
Mortgage with respect to each Mortgaged Property, executed and delivered by a
duly authorized officer of each party thereto.
     (ii) The Administrative Agent shall have received, and the title insurance
company issuing the policy referred to in clause (iii) below (the “Title
Insurance Company”) shall have received, maps or plats of an as-built survey of
the sites of the Mortgaged Properties certified to the Administrative Agent and
the Title Insurance Company in a manner reasonably satisfactory to them, dated a

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date reasonably satisfactory to the Administrative Agent and the Title Insurance
Company by an independent professional licensed land surveyor reasonably
satisfactory to the Administrative Agent and the Title Insurance Company.
     (iii) The Administrative Agent shall have received in respect of each
Mortgaged Property a mortgagee’s title insurance policy (or policies) or marked
up unconditional binder for such insurance, in each case in form and substance
reasonably satisfactory to the Administrative Agent. The Administrative Agent
shall have received evidence reasonably satisfactory to it that all premiums in
respect of each such policy, all charges for mortgage recording tax, and all
related expenses, if any, have been paid.
     (iv) If requested by the Administrative Agent, the Administrative Agent
shall have received (A) except to the extent a Mortgaged Property is not in a
special flood zone, a policy of flood insurance, if one meeting the following
requirements is available on commercially reasonable terms, that (1) covers any
parcel of improved real property that is encumbered by any Mortgage (2) is
written in an amount not less than the outstanding principal amount of the
indebtedness secured by such Mortgage that is reasonably allocable to such real
property or the maximum limit of coverage made available with respect to the
particular type of property under the National Flood Insurance Act of 1968,
whichever is less, and (3) has a term ending not later than the maturity of the
Indebtedness secured by such Mortgage, (B) confirmation that the Borrower has
received the notice required pursuant to Section 208(e)(3) of Regulation H of
the Board only to the extent flood insurance is required to be obtained and the
Borrower receives a copy of such notice and (C) a satisfactory policy of natural
disaster insurance that (1) covers each parcel of improved real property that is
encumbered by any Mortgage and (2) includes, but is not limited to, coverage for
property damage resulting from earthquakes and earthquake-related events.
     (v) The Administrative Agent shall have received a copy of all recorded
documents referred to, or listed as exceptions to title in, the title policy or
policies referred to in clause (iii) above and a copy of all other material
documents affecting the Mortgaged Properties.
     (l) Property Appraisal. The Administrative Agent shall have received
appraisals of the Mortgaged Property and machinery and equipment of the Borrower
used in its manufacturing operations.
     (m) Solvency Certificate. The Administrative Agent shall have received a
reasonably satisfactory solvency certificate from the chief financial officer of
the Borrower.
     (n) Insurance. The Administrative Agent shall have received insurance
certificates satisfying the requirements of Section 5.2(b) of the Guarantee and
Collateral Agreement.

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For the purpose of determining compliance with the conditions specified in this
Section 5.1, each Lender that has signed this Agreement shall be deemed to have
accepted, and to be satisfied with, each document or other matter required under
this Section 5.1 unless the Administrative Agent shall have received written
notice from such Lender prior to the proposed Closing Date specifying its
objection thereto.
          5.2 Conditions to Each Extension of Credit. The agreement of each
Lender to make any extension of credit requested to be made by it on any date
(including its initial extension of credit) is subject to the satisfaction of
the following conditions precedent:
     (a) Representations and Warranties. Each of the representations and
warranties made by any Loan Party in or pursuant to the Credit Documents shall
be true and correct in all material respects on and as of such date as if made
on and as of such date.
     (b) No Default. No Default or Event of Default shall have occurred and be
continuing on such date or after giving effect to the extensions of credit
requested to be made on such date.
Each borrowing by and issuance of a Letter of Credit on behalf of the Borrower
hereunder shall constitute a representation and warranty by the Borrower as of
the date of such extension of credit that the conditions contained in this
Section 5.2 have been satisfied.
SECTION 6. AFFIRMATIVE COVENANTS
          The Borrower hereby agrees that, so long as the Commitments remain in
effect, any Letter of Credit remains outstanding that is not back-stopped to the
satisfaction of the Administrative Agent or any Loan or other amount is owing to
any Lender or the Administrative Agent hereunder, the Borrower shall and shall
cause each of its Subsidiaries to:
          6.1 Financial Statements. Furnish to the Administrative Agent and each
Lender:
     (a) as soon as available, but in any event no later than 105 days after the
end of each fiscal year of the Borrower, a copy of the audited consolidated
balance sheet of the Borrower and its consolidated Subsidiaries as at the end of
such year and the related audited consolidated statements of income and of cash
flows for such year, setting forth in each case in comparative form the figures
for the previous year, reported on without a “going concern” or like
qualification or exception, or qualification arising out of the scope of the
audit, by Deloitte & Touche LLP or other independent certified public
accountants of nationally recognized standing;
     (b) as soon as available, but in any event not later than 55 days after the
end of each of the first three quarterly periods of each fiscal year of the
Borrower, the unaudited consolidated balance sheet of the Borrower and its
consolidated Subsidiaries as at the end of such quarter, the related unaudited
consolidated statements of income for such quarter and the portion of the fiscal
year through the end of such quarter and the related unaudited consolidated
statements of cash flows for the portion of the fiscal year through the end of
such quarter (excluding any notes with respect thereto), setting forth in each
case in comparative form the figures for the previous year (or, in the case of
the quarterly period ended September 30, 2008, setting forth in comparative form
the figures for the previous year relating only to items from revenue to income
or loss before income taxes and capital expenditures), certified by a
Responsible Officer as being fairly stated in all material respects (subject to
normal year-end audit adjustments);

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     (c) as soon as available, but in any event no later than 90 days after the
end of each fiscal year of Loral, a copy of the audited consolidated balance
sheet of Loral and its consolidated Subsidiaries as at the end of such year and
the related audited consolidated statements of income and of cash flows for such
year, setting forth in each case in comparative form the figures for the
previous year, reported on without a “going concern” or like qualification or
exception, or qualification arising out of the scope of the audit, by Deloitte &
Touche LLP or other independent certified public accountants of nationally
recognized standing, provided that the filing with the SEC of Loral’s Annual
Report on Form 10-K for such fiscal year prepared in accordance with the
requirements therefor shall be deemed to satisfy the requirements of this
Section 6.1(c); and
     (d) as soon as available, but in any event not later than 45 days after the
end of each of the first three quarterly periods of each fiscal year of Loral,
the unaudited interim consolidated balance sheet of Loral and its consolidated
Subsidiaries as at the end of such quarter, the related unaudited consolidated
statements of income for such quarter and the portion of the fiscal year through
the end of such quarter and the related unaudited consolidated statements of
cash flows for the portion of the fiscal year through the end of such quarter,
certified by a Responsible Officer of Loral as being fairly state in accordance
with GAAP in all material respects (subject to normal year end audit adjustments
and except that footnote and schedule disclosure may be abbreviated), provided
that the filing with the SEC of Loral’s Quarterly Report on Form 10-Q for such
quarter prepared in accordance with the requirements therefor shall be deemed to
satisfy the requirements of this Section 6.1(d).
All such financial statements shall be complete and correct in all material
respects and shall be prepared in reasonable detail and in accordance with GAAP
applied (except as disclosed therein) consistently throughout the periods
reflected therein and with prior periods.
           6.2 Certificates; Other Information. Furnish to the Administrative
Agent and each Lender (or, in the case of clause (f), to the relevant Lender):
     (a) concurrently with the delivery of the financial statements referred to
in Section 6.1(a), a certificate of the independent certified public accountants
reporting on such financial statements stating that in making the examination
necessary therefor no knowledge was obtained of any Event of Default pursuant to
Section 7.1, except as specified in such certificate;
     (b) concurrently with the delivery of any financial statements pursuant to
Section 6.1(a) or (b), (i) a certificate of a Responsible Officer stating that,
to the best of each such Responsible Officer’s knowledge, each Loan Party during
such period has observed or performed all of its covenants and other agreements,
and satisfied every condition contained in this Agreement and the other Credit
Documents to which it is a party to be observed, performed or satisfied by it,
and that such Responsible Officer has obtained no knowledge of any Default or
Event of Default except as specified in such certificate, (ii) a Compliance
Certificate containing all information and calculations necessary for
determining compliance by each Group Member with the provisions of Section 7.1
or 7.7 referred to therein and any calculations of the Net Cash Proceeds, if

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applicable, in each case as of the last day of the fiscal quarter or fiscal year
of the Borrower (except for the fiscal quarter ended March 31, 2008), as the
case may be and (iii) to the extent not previously disclosed to the
Administrative Agent, (1) a description of any change in the jurisdiction of
organization of any Loan Party, (2) a list of any Intellectual Property
applications or registrations acquired by any Loan Party, (3) a description of
any Person that has become a Group Member and whether such Person is an
Immaterial Subsidiary, in each case since the date of the most recent report
delivered pursuant to this clause (y) (or, in the case of the first such report
so delivered, since the Closing Date) and (4) in the case of any financial
statements delivered pursuant to Section 6.1(b), a description of any satellite
construction contracts awarded to the Borrower or any of its Subsidiaries in the
relevant fiscal quarter and a reconciliation of the contracted backlog of the
Borrower and its Subsidiaries to that for the immediately prior fiscal quarter;
     (c) as soon as available, and in any event no later than 45 days after the
end of each fiscal year of the Borrower, a detailed consolidated budget for the
following fiscal year (including a projected consolidated balance sheet of the
Borrower and its Subsidiaries as of the end of the following fiscal year, the
related consolidated statements of projected cash flow, projected changes in
financial position and projected income and a description of the underlying
assumptions applicable thereto) (the “Projections”), which Projections shall in
each case be accompanied by a certificate of a Responsible Officer stating that
such Projections are based on reasonable estimates, information and assumptions
and that such Responsible Officer has no reason to believe that such Projections
are incorrect or misleading in any material respect;
     (d) within five days after the same are sent, copies of all financial
statements and reports that the Borrower sends to the holders of any class of
its debt securities or public equity securities and, within five days after the
same are filed, copies of all financial statements and reports that the Borrower
may make to, or file with, the SEC;
     (e) within five days after the same are sent, copies of all financial
statements and reports that Loral sends to the holders of any class of its debt
securities or equity securities generally and, within five days after the same
are filed, copies of all reports that Loral may make to, or file with, the SEC;
     (f) promptly, such additional financial and other information as any Lender
may from time to time reasonably request; and
     (g) if the Parent Guarantee is executed and delivered to the Administrative
Agent on or prior to January 14, 2009, prompt written notice that such Parent
Guarantee was executed and delivered and if the Parent Guarantee is not executed
and delivered to the Administrative Agent on or prior to January 14, 2009,
written notice on January 14, 2009 that the Parent Guarantee was not executed
and delivered.
     6.3 Payment of Obligations. Pay, discharge or otherwise satisfy at or
before maturity or before they become delinquent, as the case may be, all its
material obligations of whatever nature, except where the amount or validity
thereof is currently being

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contested in good faith by appropriate proceedings and reserves in conformity
with GAAP with respect thereto have been provided on the books of the relevant
Group Member except where the failure to so pay is due to a good faith error or
omission; provided that this covenant shall not require the Borrower to pay any
Indebtedness or Guarantee Obligation if such failure to pay would not result in
an Event of Default under Section 8(f).
     6.4 Maintenance of Existence; Compliance. (a)(i) Preserve, renew and keep
in full force and effect its organizational existence and (ii) take all
reasonable action to maintain all rights, privileges and franchises necessary or
desirable in the normal conduct of its business, except, in each case, as
otherwise permitted by Section 7.4 and except, in the case of clause (ii) above,
to the extent that failure to do so could not reasonably be expected to have a
Material Adverse Effect; and (b) comply with all Contractual Obligations and
Requirements of Law except to the extent that failure to comply therewith could
not, in the aggregate, reasonably be expected to have a Material Adverse Effect;
provided that this covenant shall not require the Borrower to pay any
Indebtedness or Guarantee Obligation if such failure to pay would not result in
an Event of Default under Section 8(f).
     6.5 Maintenance of Property; Insurance. (a) Keep all property useful and
necessary in its business in good working order and condition, ordinary wear and
tear excepted and (b) maintain with financially sound and reputable insurance
companies insurance on its property in at least such amounts and against at
least such risks (but including in any event public liability and product
liability) as are usually insured against in the same general area by companies
engaged in the same or a similar business.
     6.6 Inspection of Property; Books and Records; Discussions. (a) Keep proper
books of records and account in which full, true and correct entries in
conformity with GAAP and all Requirements of Law shall be made of all dealings
and transactions in relation to its business and activities and (b) subject to
restrictions imposed by any Governmental Authority with respect to classified
information and to contractual confidentiality restrictions with customers,
permit representatives of the Administrative Agent or any Lender to visit and
inspect any of its properties and examine and make abstracts from any of its
books and records at any reasonable time and as often as may reasonably be
desired and to discuss the business, operations, properties and financial and
other condition of the Group Members with officers and employees of the Group
Members and with their independent certified public accountants; provided, that
so long as no Event of Default has occurred and is continuing, the Group Members
shall only be required to pay the fees and expenses of the Administrative Agent
for one such inspection in any fiscal year.
     6.7 Notices. Promptly give notice to the Administrative Agent and each
Lender of:
     (a) the occurrence of any Default or Event of Default;
     (b) any (i) default or event of default under any Contractual Obligation of
any Group Member or (ii) litigation, investigation or proceeding that may exist
at any time between any Group Member and any Governmental Authority, that in
either case could reasonably be expected to have a Material Adverse Effect;
     (c) any litigation or proceeding affecting any Group Member (i) in which
the amount involved is $10,000,000 or more and not covered by insurance (other
than normal deductibles), (ii) in which injunctive or similar relief is sought
which could reasonably be expected to have a Material Adverse Effect or
(iii) which relates to any Credit Documents;

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     (d) the following events, as soon as possible and in any event within
30 days after a Responsible Officer of the Borrower knows or has reason to know
thereof: (i) the occurrence of any Reportable Event with respect to any Plan, a
failure to make any required contribution to a Plan, the creation of any Lien in
favor of the PBGC or a Plan or any withdrawal from, or the termination,
Reorganization or Insolvency of, any Multiemployer Plan or (ii) the institution
of proceedings or the taking of any other action by the PBGC or the Borrower or
any Commonly Controlled Entity or any Multiemployer Plan with respect to the
withdrawal from, or the termination, Reorganization or Insolvency of, any Plan;
     (e) any development or event that has had or could reasonably be expected
to have a Material Adverse Effect; and
     (f) any development or formal correspondence with respect to any satellite
purchase agreement that, in the reasonable belief of the Borrower, could
reasonably be expected to result in the termination of such contract in the
future or gives rise to the purchaser thereunder currently having the right to
terminate such contract, in each case, as the result of non-delivery of any
satellite to be delivered by the Borrower or any of its Subsidiaries thereunder
by the date required under such contract.
Each notice pursuant to this Section 6.7 shall be accompanied by a statement of
a Responsible Officer setting forth details of the occurrence referred to
therein and stating what action the relevant Group Member proposes to take with
respect thereto.
          6.8 Environmental Laws. (a) Comply with, and use reasonable best
efforts to ensure compliance by all tenants and subtenants, if any, with, all
applicable Environmental Laws, and obtain and comply with and maintain, and
ensure that all tenants and subtenants obtain and comply with and maintain, any
and all licenses, approvals, notifications, registrations or permits required by
applicable Environmental Laws except to the extent that the failure to do so
could not be reasonably expected to have a Material Adverse Effect.
          (b) Conduct and complete all investigations, studies, sampling and
testing, and all remedial, removal and other actions required under
Environmental Laws and promptly comply with all lawful orders and directives of
all Governmental Authorities regarding Environmental Laws except to the extent
that the failure to do so could not be reasonably expected to have a Material
Adverse Effect.
          6.9 Additional Collateral, etc. (a) With respect to any property
(except real property) acquired after the Closing Date by any Group Member
(other than (x) any property described in paragraph (b), (c) or (d) below or in
the proviso in Section 3 of the Guarantee and Collateral Agreement, (y) any
property subject to a Lien expressly permitted by Sections 7.3(g) or (s) and
(z) property acquired by any Foreign Subsidiary or Immaterial Subsidiary) as to
which the Administrative Agent, for the benefit of the Lenders, does not have a
perfected Lien, within 45 days after the date of such acquisition (i) execute
and deliver to the Administrative Agent such amendments to the Guarantee and
Collateral Agreement or such other documents as the Administrative Agent
reasonably deems necessary or advisable to grant to the Administrative Agent,
for the benefit of the Lenders, a security interest in such property and
(ii) take all actions necessary or advisable to grant to the Administrative
Agent, for the benefit of the Lenders, a perfected first priority security
interest in such property (subject to Liens permitted by Section

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7.3), including the filing of Uniform Commercial Code financing statements in
such jurisdictions as may be required by the Guarantee and Collateral Agreement
or by law or as may be requested by the Administrative Agent.
          (b) With respect to any fee interest in any real property having a
value (together with improvements thereof) of at least $5,000,000 acquired after
the Closing Date by any Group Member (other than (x) any such real property
subject to a Lien expressly permitted by Section 7.3(g) or (s) and (z) real
property acquired by any Foreign Subsidiary), within 60 days after the date of
such acquisition (i) execute and deliver a first priority Mortgage, in favor of
the Administrative Agent, for the benefit of the Lenders, covering such real
property, (ii) if requested by the Administrative Agent, provide the Lenders
with (x) title and extended coverage insurance covering such real property in an
amount at least equal to the purchase price of such real property (or such other
amount as shall be reasonably specified by the Administrative Agent) as well as
a current ALTA survey thereof, together with a surveyor’s certificate and
(y) any consents or estoppels reasonably deemed necessary or advisable by the
Administrative Agent in connection with such Mortgage, each of the foregoing in
form and substance reasonably satisfactory to the Administrative Agent and
(iii) if requested by the Administrative Agent, deliver to the Administrative
Agent legal opinions relating to the matters described above, which opinions
shall be in form and substance, and from counsel, reasonably satisfactory to the
Administrative Agent.
          (c) With respect to any new Subsidiary (other than a Foreign or an
Immaterial Subsidiary) created or acquired, after the Closing Date by any Group
Member (which, for the purposes of this paragraph (c), shall include any
existing Subsidiary that ceases to be a Foreign Subsidiary and any Immaterial
Subsidiary that becomes a Material Subsidiary), within 45 days after the date of
such creation, acquisition or event (i) execute and deliver to the
Administrative Agent such amendments to the Guarantee and Collateral Agreement
as the Administrative Agent reasonably deems necessary or advisable to grant to
the Administrative Agent, for the benefit of the Lenders, a perfected first
priority security interest in the Capital Stock of such new Subsidiary that is
owned by any Group Member, (ii) deliver to the Administrative Agent the
certificates representing such Capital Stock (to the extent such Capital Stock
is certificated), together with undated stock powers, in blank, executed and
delivered by a duly authorized officer of the relevant Group Member, (iii) cause
such new Subsidiary (A) to become a party to the Guarantee and Collateral
Agreement, (B) to take such actions necessary or advisable to grant to the
Administrative Agent for the benefit of the Lenders a perfected first priority
security interest (subject to Liens permitted by Section 7.3) in the Collateral
described in the Guarantee and Collateral Agreement with respect to such new
Subsidiary, including the filing of Uniform Commercial Code financing statements
in such jurisdictions as may be required by the Guarantee and Collateral
Agreement or by law or as may be requested by the Administrative Agent and
(C) to deliver to the Administrative Agent a certificate of such Subsidiary,
substantially in the form of Exhibit D, with appropriate insertions and
attachments, and (iv) if reasonably requested by the Administrative Agent,
deliver to the Administrative Agent legal opinions relating to the matters
described above, which opinions shall be in form and substance, and from
counsel, reasonably satisfactory to the Administrative Agent.
          (d) With respect to any new Foreign Subsidiary created or acquired
after the Closing Date by any Group Member (other than by any Group Member that
is a Foreign Subsidiary or an Immaterial Subsidiary), within 45 days after the
date of such creation or acquisition (i) execute and deliver to the
Administrative Agent such amendments to the

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Guarantee and Collateral Agreement as the Administrative Agent reasonably deems
necessary or advisable to grant to the Administrative Agent, for the benefit of
the Lenders, a perfected first priority security interest (subject to Liens
permitted by Section 7.3) in the Capital Stock of such new Subsidiary that is
owned by any such Group Member (provided that in no event shall more than 65% of
the total outstanding voting Capital Stock of any such new Subsidiary be
required to be so pledged), (ii) deliver to the Administrative Agent the
certificates representing such Capital Stock (to the extent such Capital Stock
is certificated), together with undated stock powers, in blank, executed and
delivered by a duly authorized officer of the relevant Group Member, and take
such other action as may be necessary or, in the opinion of the Administrative
Agent, desirable to perfect the Administrative Agent’s security interest
therein, and (iii) if reasonably requested by the Administrative Agent, deliver
to the Administrative Agent legal opinions relating to the matters described
above, which opinions shall be in form and substance, and from counsel,
reasonably satisfactory to the Administrative Agent.
          6.10 Reporting Requirements. Promptly furnish to the Administrative
Agent and each Lender, following a request by any Lender, all documentation and
other information that such Lender reasonably requests in order to comply with
its ongoing obligations under applicable “know your customer” and anti-money
laundering rules and regulations, including the USA Patriot Act (Title III of
Pub. L. 107-56 (signed into law October 26, 2001).
SECTION 7. NEGATIVE COVENANTS
          The Borrower hereby agrees that, so long as the Commitments remain in
effect, any Letter of Credit remains outstanding that is not back-stopped to the
satisfaction of the Administrative Agent or any Loan or other amount is owing to
any Lender or the Administrative Agent hereunder, the Borrower shall not, and
shall not permit any of its Subsidiaries to, directly or indirectly:
          7.1. Financial Condition Covenants.
          (a) Consolidated Leverage Ratio. Permit the Consolidated Leverage
Ratio as of (i) the last day of any period of four consecutive fiscal quarters
of the Borrower or (ii) the date of the incurrence of any Indebtedness (other
than Indebtedness of the type described in Section 7.2(b) or (c)) to exceed the
ratio set forth below for such period or the period during which such date
occurs, as the case may be:

          Consolidated Period   Leverage Ratio
Closing Date through September 29, 2009
  3.50 to 1.00
September 30, 2009 through December 30, 2009
  3.25 to 1.00
December 31, 2009 and thereafter
  3.00 to 1.00

          (b) Consolidated Interest Coverage Ratio. Permit the Consolidated
Interest Coverage Ratio for any period of four consecutive fiscal quarters of
the Borrower ending with any fiscal quarter to be less than 3.50 to 1.00.
          7.2 Indebtedness. Create, issue, incur, assume, become liable in
respect of or

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suffer to exist any Indebtedness, except:
     (a) Indebtedness of any Loan Party pursuant to any Credit Documents;
     (b) Indebtedness of the Borrower to any Subsidiary and of any Guarantor to
the Borrower or any other Subsidiary;
     (c) Guarantee Obligations incurred in the ordinary course of business by
the Borrower or any of its Subsidiaries of obligations of any Guarantor;
     (d) Indebtedness outstanding on the date hereof and listed on
Schedule 7.2(d) and any refinancings, refundings, renewals or extensions thereof
(without shortening the maturity of, or increasing, the principal amount thereof
except by an amount necessary to pay the fees and expenses, including prepayment
costs, incurred in connection with the refinancing and by any amount
representing accrued or deferred interest accrued prior to or during the period
of any extensions or renewals);
     (e) Indebtedness (including, without limitation, Capital Lease Obligations)
secured by Liens permitted by Section 7.3(g) in an aggregate principal amount
not to exceed $10,000,000 at any one time outstanding and extensions, renewals
and refinancings thereof without shortening the maturity of, or increasing, the
principal thereof (except by an amount necessary to pay the fees and expenses,
including prepayment costs, incurred in connection with the refinancing and by
any amount representing accrued or deferred interest accrued prior to or during
the period of any extensions or renewals);
     (f) (i) Indebtedness of the Borrower in respect of unsecured Indebtedness
(including unsecured subordinated Indebtedness) having no scheduled principal
payments prior to the Revolving Termination Date in an aggregate principal
amount not to exceed $75,000,000 and (ii) Guarantee Obligations of any Guarantor
in respect of such Indebtedness, provided that such Guarantee Obligations in
respect of subordinated Indebtedness are subordinated to the same extent as the
obligations of the Borrower in respect of such Indebtedness;
     (g) Indebtedness of the Borrower or any of its Subsidiaries in respect of
any sale (whether or not such sale is a “true sale”) by a Group Member of
Orbital Receivables in an aggregate principal amount not to exceed $50,000,000
at any one time outstanding, provided that (i) any such Indebtedness is on arms
length terms and (ii) at the time of the incurrence of such Indebtedness and
after giving effect thereto on a pro forma basis no Event of Default has
occurred and is continuing;
     (h) Indebtedness of the Borrower or any of its Subsidiaries in respect of
any sale (whether or not such sale is a “true sale”) by a Group Member of Vendor
Financing Receivables in an aggregate principal amount not to exceed $50,000,000
at any one time outstanding, provided that (i) any such Indebtedness is on arms
length terms and (ii) at the time of the incurrence of such Indebtedness and
after giving effect thereto on a pro forma basis no Event of Default has
occurred and is continuing;
     (i) additional Indebtedness of the Borrower or any of its Subsidiaries in
an

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aggregate principal amount (for the Borrower and all Subsidiaries) not to exceed
$15,000,000 at any one time outstanding;
     (j) (i) Indebtedness of a Person existing at the time such Person is merged
into or consolidated with the Borrower or any of its Subsidiaries or becomes a
Subsidiary, in each case in connection with an Investment or acquisition
permitted under Section 7.8; provided that (x) such Indebtedness was not
incurred in contemplation of or in connection with such Investment or
acquisition and (y) the aggregate amount of all such Indebtedness shall not
exceed $25,000,000 and (ii) any modification, refinancing, refunding, renewal or
extension of such Indebtedness (including at the time of such Investment or
acquisition); provided that the terms and conditions (including, if applicable,
as to collateral but excluding as to subordination, interest rate and redemption
premium) of any such modification, refinancing, refunding, renewal or extension,
taken as a whole, are not materially less favorable to the Group Members or the
Lenders than the terms and conditions of the Indebtedness being modified,
refinanced, refunded, renewed or extended; and
     (k) Indebtedness of the Borrower to Holdings or Loral incurred in
connection with any loan providing Vendor Financing to Sirius Satellite Radio
Inc. (or its successors and permitted assigns) not to exceed $100,000,000 at any
one time outstanding, provided that any such Indebtedness is not secured other
than by property of the Borrower and its Subsidiaries that is not Collateral or
required by the Credit Documents to be Collateral.
          7.3 Liens. Create, incur, assume or suffer to exist any Lien upon any
of its property, whether now owned or hereafter acquired, except:
          (a) Liens for taxes not yet due or that are being contested in good
faith by appropriate proceedings, provided that adequate reserves with respect
thereto are maintained on the books of the Borrower or its Subsidiaries, as the
case may be, in conformity with GAAP;
     (b) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or
other like Liens arising in the ordinary course of business that are not overdue
for a period of more than 30 days or that are being contested in good faith by
appropriate proceedings;
     (c) pledges or deposits in connection with workers’ compensation,
unemployment insurance and other social security legislation and deposits
securing liabilities to insurance carriers under insurance or self-insurance
arrangements;
     (d) deposits to secure the performance of bids, trade contracts (other than
for borrowed money), leases, statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature incurred in the
ordinary course of business;
     (e) easements, rights-of-way, restrictions and other similar encumbrances
incurred in the ordinary course of business that, in the aggregate, are not
substantial in amount and that do not in any case materially detract from the
value of the property subject thereto or materially interfere with the ordinary
conduct of the business of the Borrower or any of its Subsidiaries;

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     (f) Liens in existence on the date hereof listed on Schedule 7.3(f),
securing Indebtedness permitted by Section 7.2(d) and extensions, renewals and
refinancings thereof; provided in each case, that no such Lien is spread to
cover any additional property after the Closing Date and that the principal
amount of such Indebtedness is not thereby increased (except by an amount
necessary to pay the fees and expenses, including prepayment costs, incurred in
connection with the refinancing and by an amount representing accrued or
deferred interest accrued prior to or during the period of any such extension or
renewal);
     (g) Liens securing Indebtedness of the Borrower or any other Subsidiary
incurred pursuant to Section 7.2(e) to finance the acquisition, construction or
improvement of fixed or capital assets, provided that (i) such Liens shall be
created within 180 days of the acquisition of such fixed or capital assets,
(ii) such Liens do not at any time encumber any property other than the property
financed by such Indebtedness and (iii) the amount of Indebtedness secured
thereby is not increased except in connection with further improvements and
additions to such assets and as otherwise provided by Section 7.2(e);
     (h) Liens created pursuant to the Security Documents;
     (i) any interest or title of a lessor under any lease entered into by the
Borrower or any other Subsidiary in the ordinary course of its business and
covering only the assets so leased;
     (j) Liens on satellite assets and other Work-in-Progress (as defined in the
Guarantee and Collateral Agreement) related to a sale contract with a customer
securing the obligations of a Group Member under such sale contract;
     (k) Liens in favor of customs and revenue authorities arising as a matter
of law to secure payment of customs duties in connection with the importation of
goods;
     (l) Liens in connection with any judgment which is not the basis for the
existence of an Event of Default pursuant to Section 8(j);
     (m) Liens in favor of a Lender or an affiliate of a Lender pursuant to
(i) an interest rate protection agreement, foreign currency exchange protection
agreement or commodities purchase protection agreement permitted hereunder or
(ii) cash management programs, but only where (A) the loans and obligations
hereunder are also secured by a Lien on the collateral that is the subject of
such Lien, and (B) the loans and obligations hereunder and the obligations under
such protection agreements and cash management programs will share pari passu in
the collateral;
     (n) Liens on Orbital Receivables and Vendor Financing Receivables securing
any Indebtedness in respect of a sale (whether or not such sale is a “true
sale”) thereof permitted by Section 7.2(g) or (h) or relating to a Disposition
thereof permitted by Section 7.5(g) or (h);
     (o) Liens not otherwise permitted by this Section so long as neither
(i) the

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aggregate outstanding principal amount of the obligations secured thereby nor
(ii) the aggregate fair market value (determined as of the date such Lien is
incurred) of the assets subject thereto exceeds (as to the Borrower and all
Subsidiaries) $15,000,000 at any one time;
     (p) Liens listed on the title report, listed on Schedule 7.3(p);
     (q) Liens incurred in the ordinary course of business in favor of financial
intermediaries and clearing agents pending clearance of payment for Investments
of the type permitted under Section 7.8 or 7.12;
     (r) Liens on property of the Borrower and its Subsidiaries not constituting
Collateral or required by the Credit Documents to be Collateral securing
Indebtedness under Section 7.2(k); and
     (s) Liens existing on the property of any Person at the time such Person is
merged into or consolidated with the Borrower or any of its Subsidiaries or
becomes a Subsidiary after the Closing Date and the replacement, extension or
renewal of any Lien permitted by this clause upon or in the same property
previously subject thereto in connection with the replacement, extension or
renewal (without increase in the amount or any change in any direct or
contingent obligor or collateral) of the amount secured thereby; provided that
(i) such Lien was not created in contemplation of such Person becoming a
Subsidiary, (ii) such Lien does not extend to or cover any other assets or
property (other than the proceeds or products thereof), (iii) such Lien does not
secure obligations in an aggregate principal amount exceeding $25,000,000 and
(iv) the Indebtedness secured thereby is permitted under Section 7.2(j).
          7.4 Fundamental Changes. Enter into any merger, consolidation or
amalgamation, or liquidate, wind up or dissolve itself (or suffer any
liquidation or dissolution), or Dispose of all or substantially all of its
property or business, except that:
     (a) any Subsidiary of the Borrower may be merged or consolidated with or
into the Borrower (provided that the Borrower shall be the continuing or
surviving corporation) or with or into any Guarantor (provided that the
Guarantor shall be the continuing or surviving corporation);
     (b) any Subsidiary of the Borrower may Dispose of any or all of its assets
(i) to the Borrower or any Guarantor or, in the case of a Subsidiary which is
not a Guarantor, any other Subsidiary (upon voluntary liquidation, dissolution
or otherwise) or (ii) pursuant to a Disposition permitted by Section 7.5; and
     (c) any Investment expressly permitted by Section 7.8 may be structured as
a merger, consolidation or amalgamation.
          7.5 Disposition of Property. Dispose of any of its property, whether
now owned or hereafter acquired, or, in the case of any Subsidiary, issue or
sell any shares of such Subsidiary’s Capital Stock to any Person, except:
     (a) The Disposition of obsolete or worn out property in the ordinary course
of business;

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     (b) the Disposition of inventory and related orbital slots in the ordinary
course of business;
     (c) Dispositions permitted by clause (i) of Section 7.4(b);
     (d) the Disposition or issuance of any Subsidiary’s Capital Stock or other
assets to the Borrower or any Guarantor or in accordance with any shareholders’
or like agreement in existence on the date hereof or entered into by any Group
Member in connection with any investment otherwise permitted hereby;
     (e) the sale, transfer or other disposition of cash and Cash Equivalents;
     (f) the license of Intellectual Property in the ordinary course of business
or the lease of satellite transponder capacity pursuant to the Apstar
Transponder Lease, in each case which does not materially interfere with the
business of the Borrower and its Subsidiaries, taken as a whole;
     (g) Dispositions of Orbital Receivables (including in transactions giving
rise to Indebtedness permitted by Section 7.2(g)) for aggregate proceeds not to
exceed $50,000,000, provided that (x) any such Disposition is on arms length
terms and (y) at the time of such Disposition and after giving effect thereto on
a pro forma basis no Event of Default has occurred and is continuing;
     (h) Dispositions of Vendor Financing Receivables (including in transactions
giving rise to Indebtedness permitted by Section 7.2(h)) for aggregate proceeds
not to exceed $50,000,000, provided that (x) any such Disposition is on arms
length terms and (y) at the time of such Disposition and after giving effect
thereto on a pro forma basis no Event of Default has occurred and is continuing;
     (i) the Disposition of other property having a fair market value not to
exceed $10,000,000 in the aggregate for any fiscal year of the Borrower and
$25,000,000 in the aggregate during the term of the Revolving Facility; and
     (j) the Disposition of any commitment to provide, or loan so providing,
Vendor Financing of up to $100,000,000 to Sirius Satellite Radio Inc. (or its
successors and permitted assigns) or of the Vendor Financing Receivables arising
therefrom (i) in connection with the incurrence of Indebtedness permitted by
Section 7.2(k) or (ii) in a Disposition that may be accounted for as a “true
sale” in accordance with GAAP, provided that (x) any such Disposition is on arms
length terms and (y) at the time of such Disposition and after giving effect
thereto on a pro forma basis no Event of Default has occurred and is continuing.
          7.6 Restricted Payments. Declare or pay any dividend (other than
dividends payable solely in common stock of the Person making such dividend) on,
or make any payment on account of, or set apart assets for a sinking or other
analogous fund for, the purchase, redemption, defeasance, retirement or other
acquisition of, any Capital Stock of any Group Member, whether now or hereafter
outstanding, or make any other distribution in respect thereof, either directly
or indirectly, whether in cash or property or in obligations of any Group Member

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(collectively, “Restricted Payments,” it being understood that any repayment of
Indebtedness of the Borrower permitted under Section 7.2(k) with payments under
any loan providing Vendor Financing to Sirius Satellite Radio Inc. (or its
successors and permitted assigns) shall not constitute a Restricted Payment),
except that:
     (a) any Subsidiary (i) may make Restricted Payments to the Borrower or any
Guarantor and (ii) declare or pay dividends on a pro rata basis to the Borrower,
any Guarantor and such Subsidiary’s other shareholders;
     (b) the Borrower may make payments to Loral in amounts and on dates as
required for federal, state and local income tax payments attributable to income
from the operations of the Borrower and its Subsidiaries;
     (c) so long as no Event of Default shall have occurred and be continuing or
would result therefrom, the Borrower may make payments to Loral, without
duplication, (i) in an amount not greater than the allocated reasonable (as
determined by the Board of Directors of Loral in good faith) corporate overhead
expenses of Loral attributable to its ownership of the Borrower incurred in the
ordinary course of business not to exceed $15,000,000 during any fiscal year of
the Borrower, provided that at the time of any such dividend and after giving
effect thereto the Available Liquidity of the Borrower and its Subsidiaries is
at least equal to $50,000,000 and (ii) in an amount not greater than $1,500,000
to Loral during any fiscal year of the Borrower as a management fee;
     (d) so long as no Event of Default shall have occurred and be continuing or
would result therefrom, the Borrower may pay dividends in an aggregate amount up
to the sum of the capital contributions in cash received on or after August 15,
2008 by the Borrower in excess of $50,000,000 in the aggregate to the extent
that such capital contributions have not been and will not be used to increase
the limitation on additional Capital Expenditures; provided that at the time of
any such dividend and after giving effect thereto (x) the Available Liquidity of
the Borrower and its Subsidiaries is at least equal to $50,000,000 and (y) the
Consolidated Leverage Ratio of the Borrower shall be no greater than 2.50 to
1.00; and
     (e) so long as no Event of Default shall have occurred and be continuing or
would result therefrom, the Borrower may pay a dividend to Holdings if, at such
time and after giving effect to such dividend, the aggregate sum of all such
dividends made after the date hereof and pursuant to this Section 7.6(e) shall
not exceed the remainder of (a) 50% of the aggregate Consolidated Net Income of
the Borrower and its Subsidiaries on a cumulative basis for completed financial
quarters from June 30, 2008 for which such Consolidated Net Income is positive
minus (b) 100% of the amount by which aggregate Consolidated Net Income of the
Borrower and its Subsidiaries on a cumulative basis is less than zero for
completed financial quarters from June 30, 2008 for which such Consolidated Net
Income is negative (for the purposes of this Section 7.6(e) only, the definition
of Consolidated Net Income shall not include either “extraordinary gains” or
“extraordinary losses” as such terms are defined in accordance with GAAP);
provided that at the time of any such dividend and after giving effect thereto
(x) the Available Liquidity of the Borrower and its Subsidiaries is at least
equal to $50,000,000 and (y) the Consolidated Leverage Ratio of the Borrower
shall be no greater than 2.50 to 1.00.

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          7.7 Capital Expenditures. Make or commit to make any Capital
Expenditure, except (a) Capital Expenditures of the Borrower and its
Subsidiaries not exceeding $30,000,000 for the first fiscal year of the Borrower
ending after the Closing Date, and for each succeeding fiscal year, $30,000,000
plus the positive difference (if any) between the $30,000,000 and the amount of
Capital Expenditures made pursuant to this clause in the prior fiscal year and
(b) additional Capital Expenditures of up to $55,000,000 in the aggregate. The
limitation on additional Capital Expenditures in clause (b) above shall be
increased on a dollar-for-dollar basis by the proceeds of (i) any capital
contribution to or equity issuance by the Borrower after the Closing Date and
(ii) the incurrence of unsecured Indebtedness incurred under
Section 7.2(f).Investments. Make any advance, loan, extension of credit (by way
of guaranty or otherwise) or capital contribution to, or purchase any Capital
Stock, bonds, notes, debentures or other debt securities of, or any assets
constituting a business unit of, or make any other investment in, or purchase an
orbital slot from, any Person (all of the foregoing, “Investments”), except:
     (a) extensions of trade credit (including, without limitation, orbital
receivables) in the ordinary course of business;
     (b) investments in Cash Equivalents;
     (c) Guarantee Obligations permitted by Section 7.2;
     (d) advances to subcontractors in the ordinary course of business;
     (e) loans and advances to employees of any Group Member in the ordinary
course of business (including for travel, entertainment and relocation expenses)
not to exceed $2,000,000 at any one time outstanding;
     (f) Investments consisting of Capital Stock, obligations, securities or
other property received in settlement of accounts receivable (created in the
ordinary course of business) from bankrupt or insolvent obligors;
     (g) Investments (i) under Vendor Financings extended or committed by the
Loan Parties as of the Closing Date and described on Schedule 7.8, Part I and
(ii) existing on the Closing Date in the Persons listed on Schedule 7.8,
Part II;
     (h) Investments in an aggregate amount not to exceed $60,000,000 at any one
time outstanding inclusive of Vendor Financings (other than Investments under
clause (g) above), provided that Investments consisting of the purchase of
Capital Stock of customers and the purchase of orbital slots shall not exceed
$30,000,000 at any one time outstanding;
     (i) intercompany Investments by any Group Member in the Borrower or any
Person that, prior to such investment, is a Guarantor; and
     (j) in addition to Investments otherwise expressly permitted by this
Section, Investments by the Borrower or any of its Subsidiaries in an aggregate
amount (valued at cost) not to exceed $25,000,000 during the term of this
Agreement; provided that at the time of any such Investment the Consolidated
Leverage Ratio on a pro forma basis reflecting such Investment and any
Indebtedness incurred to finance it is not greater than

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2.00 to 1.00; and provided further that no Investment under this clause (j)
shall be made to purchase Capital Stock of customers or to purchase orbital
slots (which such Investments are subject to the limits under clause (h) above).
          7.9 Optional Payments and Modifications of Certain Debt Instruments.
(a) Make or offer to make any optional or voluntary payment, prepayment,
repurchase or redemption of or otherwise optionally or voluntarily defease or
segregate funds with respect to any Indebtedness incurred under Section 7.2(f)
or (b) amend, modify, waive or otherwise change, or consent or agree to any
amendment, modification, waiver or other change to any such Indebtedness that
would shorten any scheduled date for the payment of the principal thereof.
          7.10 Transactions with Affiliates. Enter into any transaction,
including any purchase, sale, lease or exchange of property, the rendering of
any service or the payment of any management, advisory or similar fees, with any
Affiliate (other than Loral, Holdings, the Borrower or any Guarantor) unless
such transaction is (i) (a) otherwise permitted under this Agreement and
(b) upon fair and reasonable terms no less favorable to the relevant Group
Member than it would obtain in a comparable arm’s length transaction with a
Person that is not an Affiliate or (ii) any transaction extending or replacing
on similar terms any transaction described on Schedule 7.10.
          7.11 Sales and Leasebacks. Enter into any arrangement with any Person
providing for the leasing by any Group Member of real or personal property that
has been or is to be sold or transferred by such Group Member to such Person or
to any other Person to whom funds have been or are to be advanced by such Person
on the security of such property or rental obligations of such Group Member.
          7.12 Swap Agreements. Enter into any Swap Agreement, except (a) Swap
Agreements entered into to hedge or mitigate risks to which the Borrower or any
Subsidiary has actual exposure (other than those in respect of Capital Stock)
and (b) Swap Agreements entered into in order to effectively cap, collar or
exchange interest rates (from fixed to floating rates, from one floating rate to
another floating rate or otherwise) with respect to any interest-bearing
liability or investment of the Borrower or any Subsidiary.
          7.13 Negative Pledge Clauses. Enter into or suffer to exist or become
effective any agreement that prohibits or limits the ability of any Group Member
to create, incur, assume or suffer to exist any Lien upon any of its property or
revenues, whether now owned or hereafter acquired, to secure its obligations
under the Credit Documents to which it is a party other than (a) this Agreement
and the other Credit Documents, (b) any agreements governing any purchase money
Liens or Capital Lease Obligations otherwise permitted hereby (in which case,
any prohibition or limitation shall only be effective against the assets
financed thereby), (c) any agreement relating to Indebtedness permitted by
Section 7.2(g), (h) or (k) to the extent such prohibition or limitation relates
to the Orbital Receivables or Vendor Financing Receivables and related assets
which are the subject thereof or the assets financed thereby, (d) any agreements
relating to Indebtedness permitted by Section 7.2(j), and any agreements
relating to assets that are the subject of Liens permitted by Section 7.3(f) or
(j) and (e) any shareholders’ or like agreements in existence on the date hereof
or entered into by any Group Member in connection with any investment otherwise
permitted hereby.

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          7.14 Clauses Restricting Subsidiary Distributions. Enter into or
suffer to exist or become effective any consensual encumbrance or restriction on
the ability of any Subsidiary of the Borrower to (a) make Restricted Payments in
respect of any Capital Stock of such Subsidiary held by, or pay any Indebtedness
owed to, the Borrower or any other Subsidiary of the Borrower, (b) make loans or
advances to, or other Investments in, the Borrower or any other Subsidiary of
the Borrower or (c) transfer any of its assets to the Borrower or any other
Subsidiary of the Borrower, except for such encumbrances or restrictions
existing under or by reason of (i) any restrictions existing under the Credit
Documents and (ii) any restrictions with respect to a Subsidiary imposed
pursuant to an agreement that has been entered into in connection with the
Disposition of all or substantially all of the Capital Stock or assets of such
Subsidiary.
          7.15 Lines of Business. Enter into any business, either directly or
through any Subsidiary, except for those businesses in which the Borrower and
its Subsidiaries are engaged on the date of this Agreement or that are
reasonably related thereto (for the avoidance of doubt, such businesses that are
reasonably related thereto shall not include the provision of satellite
services, but will include any Investments in orbital slots).
          7.16 Changes in Fiscal Periods. Permit the fiscal year of the Borrower
to end on a day other than December 31 or change the Borrower’s method of
determining fiscal quarters; provided that the Borrower, at its election, may
make such one such change to its fiscal period before the Revolving Termination
Date.
SECTION 8. EVENTS OF DEFAULT
          8.1. Events of Default. If any of the following events shall occur and
be continuing:
     (a) the Borrower shall fail to pay any principal of any Loan or
Reimbursement Obligation when due in accordance with the terms hereof; or the
Borrower shall fail to pay any interest on any Loan or Reimbursement Obligation,
or any other amount payable hereunder or under any other Credit Documents,
within five days after any such interest or other amount becomes due in
accordance with the terms hereof; or
     (b) any representation or warranty made or deemed made by any Loan Party or
Holdings herein or in any Credit Documents or that is contained in any
certificate, document or financial or other statement furnished by it at any
time under or in connection with this Agreement or any such other Credit
Documents shall prove to have been inaccurate in any material respect on or as
of the date made or deemed made; or
     (c) any Loan Party shall default in the observance or performance of any
agreement contained in clause (i) or (ii) of Section 6.4(a) (with respect to the
Borrower only), Section 6.7(a) or Section 7.1, 7.4, 7.5, 7.7, 7.9, 7.11, 7.13,
7.14 or 7.15 of this Agreement; or
     (d) (i) any Loan Party shall default in the observance or performance of
any agreement contained in Section 7.2, 7.3, 7.6, 7.8, 7.10, 7.12 and such
default shall continue unremedied for a period of five days; or

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          (ii) any Loan Party shall default in the observance or performance of
any agreement contained in (A) Section 6.1(a) or (b) and such default shall
continue unremedied for a period of 15 days or (B) Section 6.1(c) or (d) and
such default shall continue unremedied for a period of 30 days; or
     (e) any Loan Party or Holdings shall default in the observance or
performance of any other agreement contained in this Agreement or any Credit
Documents (other than as provided in paragraphs (a) through (d) of this
Section), and such default shall continue unremedied for a period of 30 days
after notice to the Borrower from the Administrative Agent or the Required
Lenders; or
     (f) any Loan Party shall (i) default in making any payment of any principal
of any Indebtedness (including any Guarantee Obligation, but excluding the
Loans) beyond the period of grace, if any, provided in the instrument or
agreement under which such Indebtedness was created; or (ii) default in making
any payment of any interest on any such Indebtedness beyond the period of grace,
if any, provided in the instrument or agreement under which such Indebtedness
was created; or (iii) default in the observance or performance of any other
agreement or condition relating to any such Indebtedness or contained in any
instrument or agreement evidencing, securing or relating thereto, or any other
event shall occur or condition exist, the effect of which default or other event
or condition is to cause, or to permit the holder or beneficiary of such
Indebtedness (or a trustee or agent on behalf of such holder or beneficiary) to
cause, with the giving of notice if required, such Indebtedness to become due
prior to its stated maturity or (in the case of any such Indebtedness
constituting a Guarantee Obligation) to become payable; provided, that a
default, event or condition described in clause (i), (ii) or (iii) of this
paragraph (e) shall not at any time constitute an Event of Default unless, at
such time, one or more defaults, events or conditions of the type described in
clauses (i), (ii) and (iii) of this paragraph (e) shall have occurred and be
continuing with respect to Indebtedness the outstanding principal amount of
which exceeds in the aggregate $10,000,000; or
     (g) (i) any of Loral, Holdings, the Borrower or any Material Subsidiary
shall commence any case, proceeding or other action (A) under any existing or
future law of any jurisdiction, domestic or foreign, relating to bankruptcy,
insolvency, reorganization or relief of debtors, seeking to have an order for
relief entered with respect to it, or seeking to adjudicate it a bankrupt or
insolvent, or seeking reorganization, arrangement, adjustment, winding-up,
liquidation, dissolution, composition or other relief with respect to it or its
debts, or (B) seeking appointment of a receiver, trustee, custodian, conservator
or other similar official for it or for all or any substantial part of its
assets, or any of Loral, Holdings, the Borrower or any Material Subsidiary shall
make a general assignment for the benefit of its creditors; or (ii) there shall
be commenced against any of Loral, Holdings, the Borrower or any Material
Subsidiary any case, proceeding or other action of a nature referred to in
clause (i) above that (A) results in the entry of an order for relief or any
such adjudication or appointment or (B) remains undismissed or undischarged for
a period of 60 days; or (iii) there shall be commenced against any of Loral,
Holdings, the Borrower or any Material Subsidiary any case, proceeding or other
action seeking issuance of a warrant of attachment, execution, distraint or
similar process against all or any substantial part of its assets that results
in the entry of an order for any

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such relief that shall not have been vacated, discharged, or stayed or bonded
pending appeal within 60 days from the entry thereof; or (iv) any of Loral,
Holdings, the Borrower or any Material Subsidiary shall take any action in
furtherance of, or indicating its consent to, approval of, or acquiescence in,
any of the acts set forth in clause (i), (ii), or (iii) above; or (v) any of
Loral, Holdings, the Borrower or any Material Subsidiary shall generally not, or
shall be unable to, or shall admit in writing its inability to, pay its debts as
they become due; or
     (h) (i) any Person shall engage in any “prohibited transaction” (as defined
in Section 406 of ERISA or Section 4975 of the Code) involving any Plan,
(ii) any failure to satisfy the “minimum funding standards” (within the meaning
of Section 412 of the Code or Section 302 of ERISA), whether or not waived,
shall exist with respect to any Single Employer Plan or any Lien in favor of the
PBGC or a Single Employer Plan shall arise on the assets of any Group Member or
any Commonly Controlled Entity, (iii) a Reportable Event shall occur with
respect to, or proceedings shall commence to have a trustee appointed, or a
trustee shall be appointed, to administer or to terminate, any Single Employer
Plan, which Reportable Event or commencement of proceedings or appointment of a
trustee is, in the reasonable opinion of the Required Lenders, likely to result
in the termination of such Plan for purposes of Title IV of ERISA, (iv) any
Single Employer Plan shall terminate for purposes of Title IV of ERISA, (v) any
Group Member or any Commonly Controlled Entity shall, or in the reasonable
opinion of the Required Lenders is likely to, incur any liability in connection
with a withdrawal from, or the Insolvency or Reorganization of, a Multiemployer
Plan or (vi) any other event or condition shall occur or exist with respect to a
Plan; and in each case in clauses (i) through (vi) above, such event or
condition, together with all other such events or conditions, if any, would have
a Material Adverse Effect; or
     (i) any Group Member or Holdings shall violate, as determined by the United
States government, any of the following United States export control laws and
regulations: (i) regulations of the United States Treasury Department’s Office
of Foreign Assets Control (31 C.F.R., Subtitle B, Chapter V, as amended),
(ii) the Arms Export Control Act (22 C.F.R., Chapter 39, as amended),
(iii) International Traffic in Arms Regulations (22 C.F.R., Subtitle M,
Chapter I, as amended) (iv) the Export Administration Act (50 U.S.C. App 2401 et
seq.) and (v) the United States Commerce Department’s Export Administration
Regulations (15 C.F.R. Part 730 et seq.); and in each case in clauses
(i) through (v) above, such event or condition, together with all other such
events or conditions, if any, would have a Material Adverse Effect; or
     (j) one or more judgments or decrees shall be entered against any Group
Member involving in the aggregate a liability (not paid or fully covered by
insurance as to which the relevant insurance company has acknowledged coverage)
of $10,000,000 or more, and all such judgments or decrees shall not have been
vacated, discharged, stayed or bonded pending appeal within 30 days from the
entry thereof; or
     (k) any of the Security Documents shall cease, for any reason, to be in
full force and effect, or any Loan Party or Holdings (as the case may be) shall
so assert, or any Lien created by any of the Security Documents in respect of
property of a Loan Party

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or the Borrower having a fair market value in excess of $5,000,000 shall cease
to be enforceable and of the same effect and priority purported to be created
thereby; or
     (l) the guarantee of any Material Subsidiary contained in Section 2 of the
Guarantee and Collateral Agreement shall cease, for any reason, to be in full
force and effect or any Material Subsidiary shall so assert; or
     (m) following its delivery and execution, the guarantee of Loral contained
in Section 2 of the Parent Guarantee shall cease, for any reason, to be in full
force and effect (except as permitted therein) or Loral shall so assert; or
     (n) any “person” or “group” (as such terms are used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)),
excluding Affiliates of MHR Fund Management LLC, shall become, or obtain rights
(whether by means or warrants, options or otherwise) to become, the “beneficial
owner” (as defined in Rules 13(d)-3 and 13(d)-5 under the Exchange Act),
directly or indirectly, of more than 35% of the outstanding common stock of
Loral; (ii) the board of directors of Loral shall cease to consist of a majority
of Continuing Directors; or (iii) Loral shall cease to own and control,
beneficially, directly or indirectly, 100% of each class of outstanding Capital
Stock of the Borrower free and clear of all Liens (except Liens created by the
Guarantee and Collateral Agreement);
then, and in any such event, (A) if such event is an Event of Default specified
in clause (i) or (ii) of paragraph (f) above with respect to the Borrower,
automatically the Commitments shall immediately terminate and the Loans (with
accrued interest thereon) and all other amounts owing under this Agreement and
the other Credit Documents (including all amounts of L/C Obligations, whether or
not the beneficiaries of the then outstanding Letters of Credit shall have
presented the documents required thereunder) shall immediately become due and
payable, and (B) if such event is any other Event of Default, either or both of
the following actions may be taken: (i) with the consent of the Required
Lenders, the Administrative Agent may, or upon the request of the Required
Lenders, the Administrative Agent shall, by notice to the Borrower declare the
Revolving Commitments to be terminated forthwith, whereupon the Revolving
Commitments shall immediately terminate; and (ii) with the consent of the
Required Lenders, the Administrative Agent may, or upon the request of the
Required Lenders, the Administrative Agent shall, by notice to the Borrower,
declare the Loans (with accrued interest thereon) and all other amounts owing
under this Agreement and the other Credit Documents (including all amounts of
L/C Obligations, whether or not the beneficiaries of the then outstanding
Letters of Credit shall have presented the documents required thereunder) to be
due and payable forthwith, whereupon the same shall immediately become due and
payable. With respect to all Letters of Credit with respect to which presentment
for honor shall not have occurred at the time of an acceleration pursuant to
this paragraph, the Borrower shall at such time deposit in a cash collateral
account opened by the Administrative Agent an amount equal to the aggregate then
undrawn and unexpired amount of such Letters of Credit. Amounts held in such
cash collateral account shall be applied by the Administrative Agent to the
payment of drafts drawn under such Letters of Credit, and the unused portion
thereof after all such Letters of Credit shall have expired or been fully drawn
upon, if any, shall be applied to repay other obligations of the Borrower
hereunder and under the other Credit Documents. After all such Letters of Credit
shall

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have expired or been fully drawn upon, all Reimbursement Obligations shall have
been satisfied and all other obligations of the Borrower hereunder and under the
other Credit Documents shall have been paid in full, the balance, if any, in
such cash collateral account shall be returned to the Borrower (or such other
Person as may be lawfully entitled thereto). Except as expressly provided above
in this Section, presentment, demand, protest and all other notices of any kind
are hereby expressly waived by the Borrower.
          8.2 Borrower’s Right to Cure. If the Borrower fails to comply with the
covenant set forth in Section 7.1(a), the Borrower shall have the right to
reduce Indebtedness with the proceeds of any equity contributions received by
the Borrower from Loral after the end of any fiscal quarter and not more than
10 days after the date of required delivery of financial statements for such
fiscal quarter (any such equity contribution for this purpose, a “Specified
Equity Contribution”), solely for the purpose of measuring the covenant set
forth in Section 7.1(a), and, if the Borrower shall be in pro forma compliance
with such covenant after such recalculation, the applicable breach or default of
such covenant that had occurred shall be deemed cured for purposes of this
Agreement; provided that (i) in each four-fiscal-quarter period there shall be
no more than one fiscal quarter in which Specified Equity Contributions are
made, (ii) the amount of any Specified Equity Contribution shall be no greater
than the amount required to cause the Borrower to be in compliance with such
financial covenant and (iii) any Specified Equity Contribution shall be
disregarded in determining any other entitlement, covenant or basket.
SECTION 9. THE AGENTS
          9.1Appointment. Each Lender hereby irrevocably designates and appoints
the Administrative Agent as the agent of such Lender under this Agreement and
the other Credit Documents, and each such Lender irrevocably authorizes the
Administrative Agent, in such capacity, to take such action on its behalf under
the provisions of this Agreement and the other Credit Documents and to exercise
such powers and perform such duties as are expressly delegated to the
Administrative Agent by the terms of this Agreement and the other Credit
Documents, together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement, the
Administrative Agent shall not have any duties or responsibilities, except those
expressly set forth herein, or any fiduciary relationship with any Lender, and
no implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any other Credit Documents or
otherwise exist against the Administrative Agent.
          9.2 Delegation of Duties. The Administrative Agent may execute any of
its duties under this Agreement and the other Credit Documents by or through
agents or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Administrative Agent shall
not be responsible for the negligence or misconduct of any agents or attorneys
in-fact selected by it with reasonable care.
          9.3 Exculpatory Provisions. Neither any Agent nor any of their
respective officers, directors, employees, agents, advisors, attorneys-in-fact
or affiliates shall be (i) liable for any action lawfully taken or omitted to be
taken by it or such Person under or in connection with this Agreement or any
other Credit Documents (except to the extent that any of the foregoing are found
by a final and nonappealable decision of a court of competent jurisdiction to
have resulted from its or such Person’s own gross negligence, intentional breach
or willful misconduct) or (ii) responsible in any manner to any of the Lenders
for any recitals, statements, representations or warranties made by any Loan
Party or any officer thereof contained in this Agreement or any other Credit
Documents or in any certificate, report, statement or other document referred to
or

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provided for in, or received by the Agents under or in connection with, this
Agreement or any other Credit Documents or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any other Credit Documents or for any failure of any Loan Party a party thereto
to perform its obligations hereunder or thereunder. The Agents shall not be
under any obligation to any Lender to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or any other Credit Documents, or to inspect the properties,
books or records of any Loan Party.
          9.4 Reliance by Administrative Agent. The Administrative Agent shall
be entitled to rely, and shall be fully protected in relying, upon any
instrument, writing, resolution, notice, consent, certificate, affidavit,
letter, telecopy or email message, statement, order or other document or
conversation believed by it to be genuine and correct and to have been signed,
sent or made by the proper Person or Persons and upon advice and statements of
legal counsel (including counsel to the Borrower), independent accountants and
other experts selected by the Administrative Agent. The Administrative Agent may
deem and treat the payee of any Note as the owner thereof for all purposes
unless a written notice of assignment, negotiation or transfer thereof shall
have been filed with the Administrative Agent. The Administrative Agent shall be
fully justified in failing or refusing to take any action under this Agreement
or any other Credit Documents unless it shall first receive such advice or
concurrence of the Required Lenders (or, if so specified by this Agreement, all
Lenders) as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense that may
be incurred by it by reason of taking or continuing to take any such action. The
Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement and the other Credit Documents in
accordance with a request of the Required Lenders (or, if so specified by this
Agreement, all Lenders), and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders and all future holders of
the Loans.
          9.5 Notice of Default. The Administrative Agent shall not be deemed to
have knowledge or notice of the occurrence of any Default or Event of Default
unless the Administrative Agent has received notice from a Lender or the
Borrower referring to this Agreement, describing such Default or Event of
Default and stating that such notice is a “notice of default”. In the event that
the Administrative Agent receives such a notice, the Administrative Agent shall
give notice thereof to the Lenders. The Administrative Agent shall take such
action with respect to such Default or Event of Default as shall be reasonably
directed by the Required Lenders (or, if so specified by this Agreement, all
Lenders); provided that unless and until the Administrative Agent shall have
received such directions, the Administrative Agent may (but shall not be
obligated to) take such action, or refrain from taking such action, with respect
to such Default or Event of Default as it shall deem advisable in the best
interests of the Lenders.
          9.6 Non-Reliance on Agents and Other Lenders. Each Lender expressly
acknowledges that neither the Agents nor any of their respective officers,
directors, employees, agents, advisors, attorneys-in-fact or affiliates have
made any representations or warranties to it and that no act by any Agent
hereafter taken, including any review of the affairs of a Loan Party or any
affiliate of a Loan Party, shall be deemed to constitute any representation or
warranty by any Agent to any Lender. Each Lender represents to the Agents that
it has, independently and without reliance upon any Agent or any other Lender,
and based on such documents and information as it has deemed appropriate, made
its own appraisal of and investigation into the business, operations, property,
financial and other condition and creditworthiness of the Loan Parties and their
affiliates and made its own decision to make its Loans hereunder and enter into
this Agreement. Each Lender also represents that it

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will, independently and without reliance upon any Agent or any other Lender, and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit analysis, appraisals and decisions in
taking or not taking action under this Agreement and the other Credit Documents,
and to make such investigation as it deems necessary to inform itself as to the
business, operations, property, financial and other condition and
creditworthiness of the Loan Parties and their affiliates. Except for notices,
reports and other documents expressly required to be furnished to the Lenders by
the Administrative Agent hereunder, the Administrative Agent shall not have any
duty or responsibility to provide any Lender with any credit or other
information concerning the business, operations, property, condition (financial
or otherwise), prospects or creditworthiness of any Loan Party or any affiliate
of a Loan Party that may come into the possession of the Administrative Agent or
any of its officers, directors, employees, agents, advisors, attorneys-in-fact
or affiliates.
          9.7 Indemnification. The Lenders agree to indemnify each Agent and its
officers, directors, employees, affiliates, agents, advisors and controlling
persons (each, an “Agent Indemnitee”) (to the extent not reimbursed by the
Borrower and without limiting the obligation of the Borrower to do so), ratably
according to their respective Aggregate Exposure Percentages in effect on the
date on which indemnification is sought under this Section (or, if
indemnification is sought after the date upon which the Commitments shall have
terminated and the Loans shall have been paid in full, ratably in accordance
with such Aggregate Exposure Percentages immediately prior to such date), from
and against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind
whatsoever that may at any time (whether before or after the payment of the
Loans) be imposed on, incurred by or asserted against such Agent Indemnitee in
any way relating to or arising out of, the Commitments, this Agreement, any of
the other Credit Documents or any documents contemplated by or referred to
herein or therein or the transactions contemplated hereby or thereby or any
action taken or omitted by such Agent Indemnitee under or in connection with any
of the foregoing; provided that no Lender shall be liable for the payment of any
portion of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements that are found by a final and
nonappealable decision of a court of competent jurisdiction to have resulted
from such Agent Indemnitee’s gross negligence, intentional breach or willful
misconduct. The agreements in this Section shall survive the payment of the
Loans and all other amounts payable hereunder.
          9.8 Agent in Its Individual Capacity. Each Agent and its affiliates
may make loans to, accept deposits from and generally engage in any kind of
business with any Loan Party as though such Agent were not an Agent. With
respect to its Loans made or renewed by it and with respect to any Letter of
Credit issued or participated in by it, each Agent shall have the same rights
and powers under this Agreement and the other Credit Documents as any Lender and
may exercise the same as though it were not an Agent, and the terms “Lender” and
“Lenders” shall include each Agent in its individual capacity.
           9.9 Successor Administrative Agent. The Administrative Agent may
resign as Administrative Agent upon 30 days’ notice to the Lenders and the
Borrower. If the Administrative Agent shall resign as Administrative Agent under
this Agreement and the other Credit Documents, then the Required Lenders shall
appoint from among the Lenders a successor agent for the Lenders, which
successor agent shall (unless an Event of Default under Section 8(a), Section
8(f) or Section 8(g) with respect to the Borrower shall have occurred and be
continuing) be subject to approval by the Borrower (which approval shall not be
unreasonably withheld or delayed), whereupon such successor agent shall succeed
to the rights, powers and duties of the Administrative Agent, and the term
“Administrative Agent” shall mean such

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successor agent effective upon such appointment and approval, and the former
Administrative Agent’s rights, powers and duties as Administrative Agent shall
be terminated, without any other or further act or deed on the part of such
former Administrative Agent or any of the parties to this Agreement or any
holders of the Loans. If no successor agent has accepted appointment as
Administrative Agent by the date that is 10 days following a retiring
Administrative Agent’s notice of resignation, the retiring Administrative
Agent’s resignation shall nevertheless thereupon become effective, and the
Lenders shall assume and perform all of the duties of the Administrative Agent
hereunder until such time, if any, as the Required Lenders appoint a successor
agent as provided for above. After any retiring Administrative Agent’s
resignation as Administrative Agent, the provisions of this Section 9 and of
Section 10.5 shall continue to inure to its benefit.
          9.10 Documentation Agent and Syndication Agent. Neither the
Documentation Agent nor the Syndication Agent shall have any duties or
responsibilities hereunder in its capacity as such.
SECTION 10. MISCELLANEOUS
          10.1 Amendments and Waivers. Neither this Agreement, any other Credit
Documents, nor any terms hereof or thereof may be amended, supplemented or
modified except in accordance with the provisions of this Section 10.1. The
Required Lenders and each Loan Party party to the relevant Credit Documents may,
or, with the written consent of the Required Lenders, the Administrative Agent
and each Loan Party party to the relevant Credit Documents may, from time to
time, (a) enter into written amendments, supplements or modifications hereto and
to the other Credit Documents for the purpose of adding any provisions to this
Agreement or the other Credit Documents or changing in any manner the rights of
the Lenders or of the Loan Parties hereunder or thereunder or (b) waive, on such
terms and conditions as the Required Lenders or the Administrative Agent, as the
case may be, may specify in such instrument, any of the requirements of this
Agreement or the other Credit Documents or any Default or Event of Default and
its consequences; provided, however, that no such waiver and no such amendment,
supplement or modification shall (i) forgive the principal amount or extend the
final scheduled date of maturity of any Loan, reduce the stated rate of any
interest or fee payable hereunder (except (x) in connection with the waiver of
applicability of any post-default increase in interest rates (which waiver shall
be effective with the consent of the Required Lenders) and (y) that any
amendment or modification of defined terms used in the financial covenants in
this Agreement shall not constitute a reduction in the rate of interest or fees
for purposes of this clause (i)) or extend the scheduled date of any payment
thereof, or increase the amount or extend the expiration date of any Lender’s
Revolving Commitment, in each case without the written consent of each Lender
directly affected thereby; provided that in the event of increases to the Total
Revolving Commitment pursuant to Section 2.20, only the consent of the Lenders
committing to such increase shall be required; (ii) eliminate or reduce the
voting rights of any Lender under this Section 10.1 without the written consent
of such Lender; (iii) reduce any percentage specified in the definition of
Required Lenders, consent to the assignment or transfer by the Borrower of any
of its rights and obligations under this Agreement and the other Credit
Documents, release all or substantially all of the Collateral or release all or
substantially all of the Guarantors from their obligations under the Guarantee
and Collateral Agreement, in each case without the written consent of all
Lenders; (iv) amend, modify or waive any provision of Section 9 or any other
provision of any Credit Documents that affects the Administrative Agent without
the written consent of the Administrative Agent; (v) amend, modify or waive any
provision of Section 2.3 or 2.4 without the written consent of the Swingline
Lender; (vi) amend, modify or waive any provision of Section 3 without the
written consent of the Issuing Lender; (vii) amend, modify or

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waive Section 2.1(a)(ii)(B)(y) without the consent of all Lenders; (viii) amend,
modify or waive Section 8.1(m) without the consent of all Lenders; (ix) amend,
modify or waive Section 2.21 without the consent of all Lenders; (x) amend,
modify or waive Section 2.14 without the consent of all Lenders; or (xi) amend,
modify or waive any provision of Exhibit I (except for inserting the appropriate
date and similar execution details when completing the execution form of the
Parent Guarantee) or of the Parent Guarantee without the consent of all Lenders.
Any such waiver and any such amendment, supplement or modification shall apply
equally to each of the Lenders and shall be binding upon the Loan Parties, the
Lenders, the Administrative Agent and all future holders of the Loans. In the
case of any waiver, the Loan Parties, the Lenders and the Administrative Agent
shall be restored to their former position and rights hereunder and under the
other Credit Documents, and any Default or Event of Default waived shall be
deemed to be cured and not continuing; but no such waiver shall extend to any
subsequent or other Default or Event of Default, or impair any right consequent
thereon.
     Notwithstanding the foregoing, this Agreement may be amended (or amended
and restated) with the written consent of the Required Lenders, the
Administrative Agent and the Borrower (a) to add one or more additional credit
facilities to this Agreement and to permit the extensions of credit from time to
time outstanding thereunder and the accrued interest and fees in respect thereof
to share ratably in the benefits of this Agreement and the other Credit
Documents with the Revolving Extensions of Credit and the accrued interest and
fees in respect thereof and (b) to include appropriately the Lenders holding
such credit facilities in any determination of the Required Lenders.
          10.2. Notices. All notices, requests and demands to or upon the
respective parties hereto to be effective shall be in writing (including by
telecopy), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when delivered, or three Business Days after being
deposited in the mail, postage prepaid, or, in the case of telecopy notice, when
received, addressed as follows in the case of the Borrower and the
Administrative Agent, and as set forth in an administrative questionnaire
delivered to the Administrative Agent in the case of the Lenders, or to such
other address as may be hereafter notified by the respective parties hereto:

     
Borrower:
   
 
  Space Systems/Loral, Inc.
 
  3825 Fabian Way
 
  Palo Alto, CA 94303
 
  Attention: Ron Haley
 
  Tel: (650) 852-7205
 
  Fax: (650) 852-6417
 
   
with a copy to:
  Loral Space & Communications Inc.
 
  600 Third Avenue
 
  New York, NY 10016
 
  Attention: Richard Mastoloni, Senior Vice President and Treasurer
 
  Tel: (212) 338-5605
 
  Fax: (212) 867-9167
 
   
Administrative Agent:
  JPMorgan Chase Bank, N.A.
 
  270 Park Avenue, Floor 4
 
  New York, New York 10017
 
  Attention: Randolph Cates

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  Telecopy: (212) 270-8997
 
  Telephone: (212) 270-6637
 
   
with a copy to:
  JPMorgan Chase Bank, N.A.
 
  Agent Bank Services Group
 
  1111 Fannin St., Floor 10
 
  Houston, Texas 77002
 
  Attention: Omar Jones
 
  Telecopy: (713) 750-7912
 
  Telephone: (713) 750-2938

provided that any notice, request or demand to or upon the Administrative Agent
or the Lenders shall not be effective until received.
Notices and other communications to the Lenders hereunder may be delivered or
furnished by electronic communications pursuant to procedures approved by the
Administrative Agent; provided that the foregoing shall not apply to notices
pursuant to Section 2 unless otherwise agreed by the Administrative Agent and
the applicable Lender. The Administrative Agent or the Borrower may, in its
discretion, agree to accept notices and other communications to it hereunder by
electronic communications pursuant to procedures approved by it; provided that
approval of such procedures may be limited to particular notices or
communications.
          10.3. No Waiver; Cumulative Remedies. No failure to exercise and no
delay in exercising, on the part of the Administrative Agent or any Lender, any
right, remedy, power or privilege hereunder or under the other Credit Documents
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and
not exclusive of any rights, remedies, powers and privileges provided by law.
          10.4 Survival of Representations and Warranties. All representations
and warranties made hereunder, in the other Credit Documents and in any
document, certificate or statement delivered pursuant hereto or in connection
herewith shall survive the execution and delivery of this Agreement and the
making of the Loans and other extensions of credit hereunder.
          10.5 Payment of Expenses and Taxes. The Borrower agrees (a) to pay or
reimburse the Administrative Agent for its reasonable costs and expenses
incurred in connection with the development, preparation and execution of, and
any amendment, supplement or modification to, this Agreement and the other
Credit Documents and any other documents prepared in connection herewith or
therewith, and the consummation and administration of the transactions
contemplated hereby and thereby, including the reasonable and documented fees
and disbursements of counsel to the Administrative Agent and filing and
recording fees and expenses, with statements with respect to the foregoing to be
submitted to the Borrower prior to the Closing Date (in the case of amounts to
be paid on the Closing Date) and from time to time thereafter on a quarterly
basis or such other periodic basis as the Administrative Agent shall deem
appropriate, (b) to pay or reimburse each Lender and the Administrative Agent
for its reasonable costs and expenses incurred in connection with the
enforcement or preservation of any rights under this Agreement, the other Credit
Documents and any such other documents, including the documented fees and
disbursements of counsel (including the allocated fees and

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expenses of in-house counsel to the extent such counsel performs services that
would otherwise be performed by outside counsel) to each Lender and of counsel
to the Administrative Agent, (c) to pay, indemnify, and hold each Lender and the
Administrative Agent harmless from, any and all recording and filing fees and
any and all liabilities with respect to, or resulting from any delay in paying,
stamp, excise and other taxes (other than taxes excluded from the definition of
“Non-Excluded Taxes” in Section 2.16(a)), if any, that may be payable or
determined to be payable in connection with the execution and delivery of, or
consummation or administration of any of the transactions contemplated by, or
any amendment, supplement or modification of, or any waiver or consent under or
in respect of, this Agreement, the other Credit Documents and any such other
documents, and (d) to pay, indemnify, and hold each Lender and the
Administrative Agent and their respective officers, directors, employees,
affiliates, agents, advisors and controlling persons (each, an “Indemnitee”)
harmless from and against any and all other liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever with respect to or arising out of defending,
prosecuting or complying with any proceeding, action or investigation arising
out of or relating to the execution, delivery, enforcement, performance and
administration of this Agreement, the other Credit Documents and any such other
documents, including any of the foregoing relating to the use of proceeds of the
Loans or the violation of, noncompliance with or liability under, any
Environmental Law applicable to the operations of any Group Member or any of the
Properties and the reasonable fees and expenses of legal counsel in connection
with claims, actions or proceedings by any Indemnitee against any Loan Party
under any Credit Documents (all the foregoing in this clause (d), collectively,
the “Indemnified Liabilities”), provided, that the Borrower shall have no
obligation hereunder to any Indemnitee with respect to Indemnified Liabilities
to the extent such Indemnified Liabilities are found by a final and
nonappealable decision of a court of competent jurisdiction to have resulted
from the gross negligence, intentional breach or willful misconduct of such
Indemnitee. Without limiting the foregoing, and to the extent permitted by
applicable law, the Borrower agrees not to assert and to cause its Subsidiaries
not to assert, and hereby waives and agrees to cause its Subsidiaries to waive,
all rights for contribution or any other rights of recovery with respect to all
claims, demands, penalties, fines, liabilities, settlements, damages, costs and
expenses of whatever kind or nature, under or related to Environmental Laws,
that any of them might have by statute or otherwise against any Indemnitee. All
amounts due under this Section 10.5 shall be payable not later than 10 days
after written demand therefor. Statements payable by the Borrower pursuant to
this Section 10.5 shall be submitted to Richard Mastoloni (Telephone No. (212)
338-5605) (Telecopy No. (212) 867-9167), at the address of Loral set forth in
Section 10.2, or to such other Person or address as may be hereafter designated
by the Borrower in a written notice to the Administrative Agent. The agreements
in this Section 10.5 shall survive repayment of the Loans and all other amounts
payable hereunder.
          10.6 Successors and Assigns; Participations and Assignments. (a) The
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns permitted hereby
(including any affiliate of the Issuing Lender that issues any Letter of
Credit), except that (i) the Borrower may not assign or otherwise transfer any
of its rights or obligations hereunder without the prior written consent of each
Lender (and any attempted assignment or transfer by the Borrower without such
consent shall be null and void) and (ii) no Lender may assign or otherwise
transfer its rights or obligations hereunder except in accordance with this
Section.(i) Subject to the conditions set forth in paragraph (b)(ii) below, any
Lender may assign to one or more assignees (each, an “Assignee”) all or a
portion of its rights and obligations under

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this Agreement (including all or a portion of its Commitments and the Loans at
the time owing to it) with the prior written consent of the Borrower (such
consent not to be unreasonably withheld or delayed), provided that no consent of
the Borrower shall be required for an assignment to a Lender, an affiliate of a
Lender, an Approved Fund (as defined below) or, if an Event of Default under
Section 8(a), (f) or (g) has occurred and is continuing, any other Person other
than a Competing Person.
     (ii) Assignments shall be subject to the following additional conditions:
     (A) except in the case of an assignment to a Lender, an affiliate of a
Lender or an Approved Fund or an assignment of the entire remaining amount of
the assigning Lender’s Commitments or Loans under the Revolving Facility, the
amount of the Commitments or Loans of the assigning Lender subject to each such
assignment (determined as of the date the Assignment and Assumption with respect
to such assignment is delivered to the Administrative Agent) shall not be less
than $5,000,000 unless each of the Borrower and the Administrative Agent
otherwise consent, provided that (1) no such consent of the Borrower shall be
required if an Event of Default has occurred and is continuing and (2) such
amounts shall be aggregated in respect of each Lender and its affiliates or
Approved Funds, if any;
     (B) (1) the parties to each assignment shall execute and deliver to the
Administrative Agent an Assignment and Assumption, together with a processing
and recordation fee of $3,500 and (2) the assigning Lender shall have paid in
full any amounts owing by it to the Administrative Agent;
     (C) the Assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an administrative questionnaire in which the Assignee
designates one or more credit contacts to whom all syndicate-level information
(which may contain material non-public information about the Borrower and its
Affiliates and their related parties or their respective securities) will be
made available and who may receive such information in accordance with the
assignee’s compliance procedures and applicable laws, including Federal and
state securities laws; and
     (D) the Assignee, if it shall be Holdings or its affiliates, shall have no
voting rights as a Lender (it being understood that its Revolving Commitment or
Revolving Extensions of Credit shall be disregarded in determining Required
Lenders).
For the purposes of this Section 10.6, “Approved Fund” means any Person (other
than a natural person) that is engaged in making, purchasing, holding or
investing in bank loans and similar extensions of credit in the ordinary course
of its business and that is administered or managed by (a) a Lender, (b) an
affiliate of a Lender or (c) an entity or an affiliate of an entity that
administers or manages a Lender.
          (iii) Subject to acceptance and recording thereof pursuant to
paragraph (b)(iv) below, from and after the effective date specified in each
Assignment and Assumption the Assignee thereunder shall be a party hereto and,
to the extent of the interest assigned by such Assignment and Assumption, have
the rights and obligations of a Lender under this Agreement,

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and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Assumption, be released from its obligations
under this Agreement (and, in the case of an Assignment and Assumption covering
all of the assigning Lender’s rights and obligations under this Agreement, such
Lender shall cease to be a party hereto but shall continue to be entitled to the
benefits of Sections 2.15, 2.16, 2.17 and 10.5). Any assignment or transfer by a
Lender of rights or obligations under this Agreement that does not comply with
this Section 10.6 shall be treated for purposes of this Agreement as a sale by
such Lender of a participation in such rights and obligations in accordance with
paragraph (c) of this Section.
          (iv) The Administrative Agent, acting for this purpose as an agent of
the Borrower, shall maintain at one of its offices a copy of each Assignment and
Assumption delivered to it and a register for the recordation of the names and
addresses of the Lenders, and the Commitments of, and principal amount of the
Loans and L/C Obligations owing to, each Lender pursuant to the terms hereof
from time to time (the “Register”). The entries in the Register shall be
conclusive, and the Borrower, the Administrative Agent, the Issuing Lender and
the Lenders may treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary.
          (v) Upon its receipt of a duly completed Assignment and Assumption
executed by an assigning Lender and an Assignee, the Assignee’s completed
administrative questionnaire (unless the Assignee shall already be a Lender
hereunder), the processing and recordation fee referred to in paragraph (b) of
this Section and any written consent to such assignment required by paragraph
(b) of this Section, the Administrative Agent shall accept such Assignment and
Assumption and record the information contained therein in the Register. No
assignment shall be effective for purposes of this Agreement unless it has been
recorded in the Register as provided in this paragraph.
          (c)(i) Any Lender may, without the consent of the Borrower or the
Administrative Agent, sell participations to one or more banks or other entities
(a “Participant”) in all or a portion of such Lender’s rights and obligations
under this Agreement (including all or a portion of its Commitments and the
Loans owing to it); provided that (A) such Lender’s obligations under this
Agreement shall remain unchanged, (B) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (C) the Borrower, the Administrative Agent, the Issuing Lender and the other
Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender’s rights and obligations under this Agreement. Any
agreement pursuant to which a Lender sells such a participation shall provide
that such Lender shall retain the sole right to enforce this Agreement and to
approve any amendment, modification or waiver of any provision of this
Agreement; provided that such agreement may provide that such Lender will not,
without the consent of the Participant, agree to any amendment, modification or
waiver that (1) requires the consent of each Lender directly affected thereby
pursuant to the proviso to the second sentence of Section 10.1 and (2) directly
affects such Participant. Subject to paragraph (c)(ii) of this Section, the
Borrower agrees that each Participant shall be entitled to the benefits of
Sections 2.15, 2.16 and 2.17 to the same extent as if it were a Lender and had
acquired its interest by assignment pursuant to paragraph (b) of this Section.
To the extent permitted by law, each Participant also shall be entitled to the

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benefits of Section 10.7(b) as though it were a Lender, provided such
Participant shall be subject to Section 10.7(a) as though it were a Lender.
          (ii) A Participant shall not be entitled to receive any greater
payment under Section 2.15 or 2.16 than the applicable Lender would have been
entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with the
Borrower’s prior written consent. Any Participant that is a Non-U.S. Lender
shall not be entitled to the benefits of Section 2.16 unless such Participant
complies with Section 2.16(d).
          (d) Any Lender may at any time pledge or assign a security interest in
all or any portion of its rights under this Agreement to secure obligations of
such Lender, including any pledge or assignment to secure obligations to a
Federal Reserve Bank, and this Section shall not apply to any such pledge or
assignment of a security interest; provided that no such pledge or assignment of
a security interest shall release a Lender from any of its obligations hereunder
or substitute any such pledgee or Assignee for such Lender as a party hereto.
          (e) The Borrower, upon receipt of written notice from the relevant
Lender, agrees to issue Notes to any Lender requiring Notes to facilitate
transactions of the type described in paragraph (d) above.
          10.7 Adjustments; Set-off. (a) Except to the extent that this
Agreement, any other Credit Documents or a court order expressly provides for
payments to be allocated to a particular Lender or to the Lenders under the
Revolving Facility, if any Lender (a “Benefitted Lender”) shall receive any
payment of all or part of the Obligations owing to it (other than in connection
with an assignment made pursuant to Section 10.6), or receive any collateral in
respect thereof (whether voluntarily or involuntarily, by set-off, pursuant to
events or proceedings of the nature referred to in Section 8(g), or otherwise),
in a greater proportion than any such payment to or collateral received by any
other Lender, if any, in respect of the Obligations owing to such other Lender,
such Benefitted Lender shall purchase for cash from the other Lenders a
participating interest in such portion of the Obligations owing to each such
other Lender, or shall provide such other Lenders with the benefits of any such
collateral, as shall be necessary to cause such Benefitted Lender to share the
excess payment or benefits of such collateral ratably with each of the Lenders;
provided, however, that if all or any portion of such excess payment or benefits
is thereafter recovered from such Benefitted Lender, such purchase shall be
rescinded, and the purchase price and benefits returned, to the extent of such
recovery, but without interest.
          (b) In addition to any rights and remedies of the Lenders provided by
law, each Lender shall have the right, without notice to the Borrower, any such
notice being expressly waived by the Borrower to the extent permitted by
applicable law, upon any Obligations becoming due and payable by the Borrower
(whether at the stated maturity, by acceleration or otherwise), to apply to the
payment of such Obligations, by setoff or otherwise, any and all deposits
(general or special, time or demand, provisional or final), in any currency, and
any other credits, indebtedness or claims, in any currency, in each case whether
direct or indirect, absolute or contingent, matured or unmatured, at any time
held or owing by such Lender, any affiliate thereof or any of their respective
branches or agencies to or for the credit or the account of the Borrower. Each
Lender agrees promptly to notify the Borrower and the Administrative Agent

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after any such application made by such Lender, provided that the failure to
give such notice shall not affect the validity of such application.
          10.8 Counterparts. This Agreement may be executed by one or more of
the parties to this Agreement on any number of separate counterparts, and all of
said counterparts taken together shall be deemed to constitute one and the same
instrument. Delivery of an executed signature page of this Agreement by
facsimile or email transmission shall be effective as delivery of a manually
executed counterpart hereof. A set of the copies of this Agreement signed by all
the parties shall be lodged with the Borrower and the Administrative Agent.
          10.9 Severability. Any provision of this Agreement that is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
          10.10 Integration. This Agreement and the other Credit Documents
represent the entire agreement of the Borrower, the Administrative Agent and the
Lenders with respect to the subject matter hereof and thereof, and there are no
promises, undertakings, representations or warranties by the Administrative
Agent or any Lender relative to the subject matter hereof not expressly set
forth or referred to herein or in the other Credit Documents.
          10.11 GOVERNING LAW. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
          10.12 Submission To Jurisdiction; Waivers. The Borrower, the
Administrative Agent and each Lender hereby irrevocably and unconditionally:
     (a) submits for itself and its property in any legal action or proceeding
relating to this Agreement and the other Credit Documents to which it is a
party, or for recognition and enforcement of any judgment in respect thereof, to
the non-exclusive general jurisdiction of the courts of the State of New York,
the courts of the United States for the Southern District of New York, and
appellate courts from any thereof;
     (b) consents that any such action or proceeding may be brought in such
courts and waives any objection that it may now or hereafter have to the venue
of any such action or proceeding in any such court or that such action or
proceeding was brought in an inconvenient court and agrees not to plead or claim
the same;
     (c) agrees that service of process in any such action or proceeding may be
effected by mailing a copy thereof by registered or certified mail (or any
substantially similar form of mail), postage prepaid, to the Borrower, as the
case may be at its address set forth in Section 10.2 or at such other address of
which the Administrative Agent shall have been notified pursuant thereto;
     (d) agrees that nothing herein shall affect the right to effect service of
process in any other manner permitted by law or shall limit the right to sue in
any other jurisdiction; and
     (e) waives, to the maximum extent not prohibited by law, any right it may
have to claim or recover in any legal action or proceeding referred to in this
Section any special, exemplary, punitive or consequential damages.

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           10.13 Acknowledgements. The Borrower hereby acknowledges that:
     (a) it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Credit Documents;
     (b) neither the Administrative Agent nor any Lender has any fiduciary
relationship with or duty to the Borrower arising out of or in connection with
this Agreement or any of the other Credit Documents, and the relationship
between Administrative Agent and Lenders, on one hand, and the Borrower, on the
other hand, in connection herewith or therewith is solely that of debtor and
creditor; and
     (c) no joint venture is created hereby or by the other Credit Documents or
otherwise exists by virtue of the transactions contemplated hereby among the
Lenders or among the Borrower and the Lenders.
          10.14 Releases of Guarantees and Liens. (a) Notwithstanding anything
to the contrary contained herein or in any other Credit Documents, the
Administrative Agent is hereby irrevocably authorized by each Lender (without
requirement of notice to or consent of any Lender except as expressly required
by Section 10.1) to take any action requested by the Borrower having the effect
of releasing any Collateral or guarantee obligations (i) to the extent necessary
to permit consummation of any transaction not prohibited by any Credit Documents
or that has been consented to in accordance with Section 10.1 or (ii) under the
circumstances described in paragraph (b) below.
     (b) At such time as the Loans, the Reimbursement Obligations and the other
obligations under the Credit Documents (other than obligations under or in
respect of Swap Agreements) shall have been paid in full, the Commitments have
been terminated and no Letters of Credit shall be outstanding, the Collateral
shall be released from the Liens created by the Security Documents, and the
Security Documents and all obligations (other than those expressly stated to
survive such termination) of the Administrative Agent and each Loan Party under
the Security Documents shall terminate, all without delivery of any instrument
or performance of any act by any Person.
          10.15 Confidentiality. Each of the Administrative Agent and each
Lender agrees to keep confidential all non-public information provided to it by
any Loan Party, the Administrative Agent or any Lender pursuant to or in
connection with this Agreement; provided that nothing herein shall prevent the
Administrative Agent or any Lender from disclosing any such information (a) to
the Administrative Agent, any other Lender or any affiliate thereof, (b) subject
to an agreement to comply with the provisions of this Section, to any actual or
prospective Transferee or any direct or indirect counterparty to any Swap
Agreement (or any professional advisor to such counterparty), (c) to its
employees, directors, agents, attorneys, accountants and other professional
advisors or those of any of its affiliates, (d) upon the request or demand of
any Governmental Authority, (e) in response to any order of any court or other
Governmental Authority or as may otherwise be required pursuant to any
Requirement of Law, (f) if requested or required to do so in connection with any
litigation or similar proceeding, (g) that has been publicly disclosed, (h) to
the National Association of Insurance Commissioners or any similar organization
or any nationally recognized rating agency that requires access to information
about a Lender’s investment portfolio in connection with ratings issued with
respect to such Lender, or (i) in connection with the exercise of any remedy
hereunder or under any other Credit Documents.
     Each Lender acknowledges that information furnished to it pursuant to this

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Agreement or the other Credit Documents may include material non-public
information concerning the Borrower and its Affiliates and their related parties
or their respective securities, and confirms that it has developed compliance
procedures regarding the use of material non-public information and that it will
handle such material non-public information in accordance with those procedures
and applicable law, including Federal and state securities laws.
          All information, including requests for waivers and amendments,
furnished by the Borrower or the Administrative Agent pursuant to, or in the
course of administering, this Agreement or the other Credit Documents will be
syndicate-level information, which may contain material non-public information
about the Borrower and its Affiliates and their related parties or their
respective securities. Accordingly, each Lender represents to the Borrower and
the Administrative Agent that it has identified in its administrative
questionnaire a credit contact who may receive information that may contain
material non-public information in accordance with its compliance procedures and
applicable law, including Federal and state securities laws.
          10.16 WAIVERS OF JURY TRIAL. THE BORROWER, THE ADMINISTRATIVE AGENT
AND THE LENDERS HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN
ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.
[Remainder of page left intentionally blank]

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          IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered by their proper and duly authorized officers as
of the day and year first above written.

            SPACE SYSTEMS/LORAL, INC.
      By:   /s/ Richard P. Mastoloni         Name:   Richard Mastoloni       
Title:   Senior Vice President and Treasurer     

 

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            JPMORGAN CHASE BANK, N.A., as
Administrative Agent and as a Lender
      By:   /s/ Randolph Cates         Name:   Randolph Cates        Title:  
Executive Director     

 

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            ING Bank N.V., as Syndication Agent and as a Lender
      By:   /s/ Wim Steenbakkers         Name:   Wim Steenbakkers       
Title:   Managing Director, Structure Finance, Telecom, Media & Technology
Finance   

            By:   /s/ Oliver Petersen         Name:   Oliver Petersen       
Title:   Vice President, Structured Finance, Telecom, Media & Technology
Finance     

 

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            BANK OF AMERICA, N.A., as Documentation
Agent and as a Lender
      By:   /s John Kushnerick         Name:   John Kushnerick        Title:  
Vice President   

 

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            CREDIT SUISSE, CAYMAN ISLANDS BRANCH, as a Lender
      By:   /s/ Karim Blasetti         Name:   Karim Blasetti        Title:  
Vice President            By:   /s/ Mikhail Faybusovich         Name:   Mikhail
Faybusovich        Title:   Vice President   

 

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            MORGAN STANLEY SENIOR FUNDING, INC.,
as a Lender
      By:   /s/ Andrew W. Earls         Name:   Andrew Earls        Title:  
Vice President   

 

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            UBS LOAN FINANCE LLC, as a Lender
      By:   /s/ David B. Julie         Name:   David B. Julie        Title:  
Associate Director Banking Products Services, US            By:   /s/ Irja R.
Otsa         Name:   Irja R. Otsa        Title:   Associate Director Banking
Products Services, US