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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
November 17, 2000
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LORAL SPACE & COMMUNICATIONS LTD.
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(Exact name of registrant as specified in its charter)
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Islands of Bermuda 1-14180 13-3867424
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation) Number
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c/o Loral SpaceCom Corporation
600 Third Avenue, New York, New York 10016
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(212) 697-1105
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Item 5. Other Events.
On November 17, 2000, Loral Satellite, Inc. ("Loral Satellite"), a
subsidiary of Loral Space & Communications Ltd. ("Loral"), entered into a $500
million secured credit agreement with Bank of America, National Association and
the other lenders parties thereto (the "Credit Agreement"). The Credit Agreement
provides for a $200 million three-year revolving credit facility (the
"Revolver") and a $300 million term loan (the "Term Loan"). The Term Loan is
subject to an amortization payment schedule as follows: 1% of the principal
amount on each of January 15, 2001 and June 30, 2001; 15% of the principal
amount on June 30, 2002; 25% of the principal amount on March 31, 2003; and 58%
of the principal amount on August 15, 2003. All amounts outstanding under the
Revolver are due and payable on August 15, 2003. Borrowings under the Credit
Agreement bear interest, at Loral Satellite's option, at various rates based on
margins over the lead bank's base rate or the London Interbank Offer Rate for
periods of one to six months. Loral Satellite pays a commitment fee on the
unused portion of the Revolver.
Proceeds from the $500 million of loans incurred under the Credit
Agreement were used by Loral Satellite to purchase all of the loans (the
"Globalstar Loans") outstanding under Globalstar's existing $500 million credit
facility (the "Globalstar Credit Agreement"). The guarantee of the Globalstar
Credit Agreement that had been provided by Loral Satellite and another Loral
subsidiary was terminated and released in connection with this transaction.
The Credit Agreement contains customary financial covenants on Loral
Satellite, including maintenance of a minimum collateral coverage ratio, minimum
net worth and EBITDA. The Credit Agreement also contains customary limitations,
including those on indebtedness, fundamental changes, asset sales, dividends,
(except that Loral Satellite may pay dividends to its parent provided that after
such dividends, it has cash on hand in an amount equal to the then undrawn
revolving commitment, if any, under the Globalstar Credit Agreement and Loral
Satellite holds an intercompany note due from its parent or Loral for at least
$100 million), investments, capital expenditures, creating liens (other than
those created pursuant to the Credit Agreement), prepayments or amendments of
indebtedness, and transactions with affiliates.
The Credit Agreement is secured by certain assets of Loral Satellite,
including the Telstar 6 and Telstar 7 satellites and the Globalstar Loans, and
the stock of Loral Satellite. Loral has also agreed to guarantee Loral
Satellite's obligations under the Credit Agreement, which guarantee agreement
contains a minimum net worth covenant.
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Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits.
Exhibit 10.1 Credit Agreement dated as of November 17, 2000 by and among
Loral Satellite, Inc., Bank of America, National
Association, Bank of America Securities LLC, Credit
Lyonnais and Lehman Commercial Paper, Inc.
Exhibit 10.2 Guarantee dated as of November 17, 2000 made by Loral Space
& Communications Ltd.
Exhibit 10.3 Assignment, Amendment and Release Agreement dated as of
November 17, 2000 by and among the lenders parties to the
Globalstar Credit Agreement, Loral Satellite, Inc., Loral
Satcom Ltd., Loral Space & Communications Ltd., Loral Space
& Communications Corporation, Globalstar, L.P. and Bank of
America, National Association
Exhibit 10.4 Amended and Restated Collateral Agreement dated as of
November 17, 2000 by and among Loral Satellite, Inc. and
Bank of America, National Association
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
Loral Space & Communications Ltd.
By: /s/ Avi Katz
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Name: Avi Katz
Title: Vice President and Secretary
Date: November 20, 2000
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EXHIBIT INDEX
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Exhibit Description
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Exhibit 10.1 Credit Agreement dated as of November 17, 2000 by and among
Loral Satellite, Inc., Bank of America, National Association,
Bank of America Securities LLC, Credit Lyonnais and Lehman
Commercial Paper, Inc.
Exhibit 10.2 Guarantee dated as of November 17, 2000 made by Loral Space &
Communications Ltd.
Exhibit 10.3 Assignment, Amendment and Release Agreement dated as of
November 17, 2000 by and among the lenders parties to the
Globalstar Credit Agreement, Loral Satellite, Inc., Loral
Satcom Ltd., Loral Space & Communications Ltd., Loral Space &
Communications Corporation, Globalstar, L.P. and Bank of
America, National Association.
Exhibit 10.4 Amended and Restated Collateral Agreement dated as of November
17, 2000 by and among Loral Satellite, Inc. and Bank of
America, National Association
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