20-F

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

__________________________

FORM 20-F

__________________________

(Mark One)

☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2023

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☐ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of event requiring this shell company report

For the transition period from to

Commission file number 001-41083

_______________________

TELESAT CORPORATION

(Exact name of Registrant as specified in its charter)

_______________________

Not Applicable(Translation of Registrant’s name into English)

British Columbia, Canada(Jurisdiction of incorporation or organization)

c/o Telesat Canada160 Elgin StreetSuite 2100Ottawa, Ontario, Canada K2P 2P7Tel: (613) 748-8700

(Address of principal executive offices)

__________________________

Christopher S. DiFrancescoVice President, General Counsel and Secretaryc/o Telesat Canada160 Elgin StreetSuite 2100Ottawa, Ontario, Canada K2P 2P7Tel: (613) 748-8700 ext. 2268cdifrancesco@telesat.com(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)

__________________________

Securities registered or to be registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Telesat Corporation Class A Common Shares	TSAT	The Nasdaq Stock Market LLC
Telesat Corporation Class B Variable Voting Shares	TSAT	The Nasdaq Stock Market LLC

Securities registered or to be registered pursuant to Section 12(g) of the Act:

None
(Title of Class)

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:

None
(Title of Class)

__________________________

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the Annual Report: At December 31, 2023, 13,497,501 Class A Common Shares and Class B Variable Voting Shares, 112,841 Class C Shares, 3 Special Voting Shares, and 1 Golden Share were issued and outstanding.

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. ☐ Yes ☒ No

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. ☐ Yes ☒ No

Note — checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those sections.

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See the definition of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer ☐	Accelerated Filer ☒	Non-Accelerated Filer ☐	Emerging growth company ☐

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act. ☐

____________

† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

U.S. GAAP ☐	International Financial Reporting Standards as issued by the International Accounting Standards Board ☒	Other ☐

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow. ☐ Item 17 ☐ Item 18

If this is an Annual Report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

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Telesat Corporation

	Page
INTRODUCTION	1
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS	2
GLOSSARY OF TERMS	4
PART I	8
ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS	8
ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE	8
ITEM 3. KEY INFORMATION	8
ITEM 4. INFORMATION ON THE COMPANY	51
ITEM 4A. UNRESOLVED STAFF COMMENTS	82
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS	82
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES	113
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS	136
ITEM 8. FINANCIAL INFORMATION	140
ITEM 9. THE OFFER AND LISTING	141
ITEM 10. ADDITIONAL INFORMATION	141
ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	171
ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES	171
PART II	172
ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES	172
ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS	172
ITEM 15. CONTROLS AND PROCEDURES	172
ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT	173
ITEM 16B. CODE OF ETHICS	173
ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES	173
ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES	174
ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS	174
ITEM 16F. CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT	174
ITEM 16G. CORPORATE GOVERNANCE	174
ITEM 16H. MINE SAFETY DISCLOSURE	174
ITEM 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS	174
ITEM 16J. INSIDER TRADING POLICIES	175
ITEM 16K. CYBERSECURITY	175
PART III	177
ITEM 17. FINANCIAL STATEMENTS.	177
ITEM 18. FINANCIAL STATEMENTS.	177
ITEM 19. EXHIBITS	178
SIGNATURES	181

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INTRODUCTION

Telesat Corporation was incorporated under the Business Corporations Act (British Columbia) on October 21, 2020. Telesat Corporation is the general partner of Telesat Partnership LP, which was formed under the Limited Partnership Act (Ontario) on November 12, 2020. We directly or indirectly own 100% of all of our operating subsidiaries.

EXPLANATORY NOTE

Unless otherwise stated, references to “Telesat,” the “Company,” “we,” “us” or “our” in this Annual Report on Form 20-F (“Annual Report”) refers to Telesat Canada and its subsidiaries before the closing of the transaction pursuant to the Transaction Agreement and Plan of Merger, dated as of November 23, 2020, by and among Telesat Canada, Telesat Corporation, Telesat Partnership LP, Telesat CanHold Corporation, Lion Combination Sub Corporation, Loral Space & Communications Inc. (“Loral”), Public Sector Pension Investment Board and Red Isle Private Investments Inc. (“Transaction”), and to Telesat Corporation and its subsidiaries (including Telesat Canada) after the closing of the Transaction.

Telesat Corporation and Telesat Partnership are reporting issuers in each of the provinces and territories of Canada and, as a result, are subject to Canadian continuous disclosure and other reporting obligations under applicable Canadian securities laws. This Annual Report on Form 20-F constitutes Telesat Corporation’s Annual Information Form for purposes of its Canadian continuous disclosure obligations under National Instrument 51-102 — Continuous Disclosure Obligations (“NI 51-102”). Pursuant to an application for exemptive relief made in accordance with National Policy 11-203 — Process for Exemptive Relief Applications in Multiple Jurisdictions, Telesat Partnership has received exemptive relief dated November 16, 2021 from the Canadian securities regulators. This exemptive relief exempts Telesat Partnership from the continuous disclosure requirements of NI 51-102, effectively allowing Telesat Partnership to satisfy its Canadian continuous disclosure obligations by relying on the Canadian continuous disclosure documents filed by Telesat Corporation, for so long as certain conditions are satisfied. See Item 10B. Additional Information under the heading “Disclosures Regarding Exemptions from Canadian Securities Law Requirements”.

We use various trademarks, trade names and service marks in our business, including Telesat and Telesat Lightspeed. For convenience, we may not include the ® or ™ symbols, but such omission is not meant to indicate that we would not protect our intellectual property rights to the fullest extent allowed by law. Any other trademarks, trade names or service marks referred to in this annual report are the property of their respective owners.

PRESENTATION OF FINANCIAL INFORMATION

Unless we indicate otherwise, financial information in this Annual Report has been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). IFRS differs in some respects from United States generally accepted accounting principles, (“U.S. GAAP”), and thus our financial statements may not be comparable to the financial statements of United States companies.

We present our historical financial statements in Canadian dollars, which is the presentation currency of the Company. All figures reported in this Annual Report are in Canadian dollars, except where we indicate otherwise, and are referenced as “$” and “dollars”.

This Annual Report contains a translation of some Canadian dollar amounts into United States dollars at specified exchange rates solely for your convenience. All references to “US$” and “U.S. dollar” refer to United States dollars.

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Annual Report contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. When used in this document, the words “believes,” “expects,” “plans,” “may,” “will,” “would,” “could,” “should,” “anticipates,” “estimates,” “project,” “intend” or “outlook” or other variations of these words or other similar expressions are intended to identify forward-looking statements and information. In addition, Telesat Corporation or its representatives have made or may make forward-looking statements, orally or in writing, which may be included in, but are not limited to, various filings made from time to time with the U.S. Securities and Exchange Commission (“SEC”), and press releases or oral statements made with the approval of an authorized executive officer of Telesat Corporation. Actual results may differ materially from anticipated results as a result of certain risks and uncertainties which are described in the section of this Annual Report entitled “Risk Factors.” Risks and uncertainties include but are not limited to (1) risks associated with financial factors, including inflation, fluctuations in exchange rates, swings in the global financial markets, increases in interest rates and access to capital; (2) risks associated with satellite services, including dependence on large customers, launch delays and failures, in-orbit failures and competition; (3) risks and uncertainties associated with Telesat Lightspeed, including overcoming technological challenges, access to spectrum and markets, governmental restrictions or regulations, supply chain disruptions, raising sufficient capital to design and implement the system and competition from other low earth orbit systems; (4) regulatory risks, such as the effect of industry and government regulations that affect Telesat Corporation; and (5) other risks, including changes in technology and consumer demand. The foregoing list of important factors is not exclusive. Furthermore, Telesat Corporation operates in an industry sector where securities values may be volatile and may be influenced by economic and other factors beyond Telesat Corporation’s control.

These factors should not be construed as exhaustive and should be read with the other cautionary statements in this annual report. These forward-looking statements are based on our current expectations, estimates, forecasts and projections about our business and the industry in which we operate and management’s beliefs and assumptions, and are not guarantees of future performance or development and involve known and unknown risks, uncertainties and other factors that are in some cases beyond our control. As a result, any or all of our forward-looking statements in this annual report may turn out to be inaccurate. Factors that may cause actual results to differ materially from current expectations include, among other things, those listed under “Risk Factors” and elsewhere in this annual report. Potential investors are urged to consider these factors carefully in evaluating the forward-looking statements. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless specifically expressed as such, and should only be viewed as historical data. These forward-looking statements speak only as at the date of this annual report. Except as required by law, we assume no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future. You should, however, review the factors and risks we describe in the reports we will file from time to time with the SEC and the Canadian securities regulatory authorities, after the date of this annual report.

This Annual Report contains estimates, projections, market research and other information concerning our industry, our business, and the markets for our services. Information that is based on estimates, forecasts, projections, market research or similar methodologies is inherently subject to uncertainties, and actual events or circumstances may differ materially from events and circumstances that are assumed in this information.

Unless otherwise expressly stated, we obtained this industry, business, market and other data from our own internal estimates and research as well as from reports, research surveys, studies and similar data prepared by market research firms and other third parties, industry and general publications, government data and similar sources.

In addition, assumptions and estimates of our and our industry’s future performance are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described in “Risk Factors.” These and other factors could cause our future performance to differ materially from our assumptions and estimates.

Any references to forward-looking statements in this annual report include forward-looking information within the meaning of applicable Canadian securities laws.

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INDUSTRY AND MARKET DATA

This Annual Report includes market data and forecasts with respect to current and projected market sizes for the telecommunications and satellite services sectors. Although we are responsible for all of the disclosure contained in this annual report, in some cases we rely on and refer to market data and certain industry forecasts that were obtained from third party surveys, market research, consultant surveys, publicly available information and industry publications and surveys that we believe to be reliable. Unless otherwise indicated, all market and industry data and other statistical information and forecasts contained in this annual report are based on independent industry publications, reports by market research firms or other published independent sources and other externally obtained data that we believe to be reliable.

Some market and industry data, and statistical information and forecasts, are also based on management’s estimates. Any such market data, information or forecast may prove to be inaccurate because of the method by which we obtain it or because it cannot always be verified with complete certainty given the limits on the availability and reliability of raw data, the voluntary nature of the data gathering process and other limitations and uncertainties, including those discussed under the captions “Risk Factors” and “Special Note Regarding Forward-Looking Statements.”

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FREQUENTLY USED TERMS

This annual report generally does not use technical defined terms, but a few frequently used terms may be helpful for you to have in mind at the outset. Unless otherwise specified or if the context so requires, the following terms have the meanings set forth below for purposes of this annual report:

“2026 Senior Secured Notes” means the 5.625% Senior Secured Notes due in December 2026 issued by Telesat Canada and Telesat LLC, as the co-issuer.

“5% Holder” means, with respect to a person, that such person, together with its affiliates, beneficially owns 5% or more of the fully diluted Telesat Corporation Shares.

“BCBCA” means the Business Corporations Act (British Columbia).

“CBCA” means the Canada Business Corporations Act.

“Change of Control” means (i) any person who, together with its affiliates and associates, acquires beneficial ownership of at least a majority of the Telesat Corporation Shares on a fully diluted basis, including by way of any arrangement, amalgamation, merger, consolidation, combination or acquisition of Telesat Corporation with, by or into another corporation, entity or person in one or more related transactions, or (ii) the sale of all or substantially all of the assets of Telesat Corporation to a third party.

“Class A Shares” means the Class A common shares of Telesat Corporation.

“Class A Special Voting Share” means the Class A Special Voting Share of Telesat Corporation.

“Class A Units” means the Class A units of Telesat Partnership.

“Class B Variable Voting Shares” means the Class B variable voting shares of Telesat Corporation.

“Class B Special Voting Share” means the Class B Special Voting Share of Telesat Corporation.

“Class B Units” means the Class B units of Telesat Partnership.

“Class C Fully Voting Shares” means the Class C fully voting shares of Telesat Corporation.

“Class C Limited Voting Shares” means the Class C limited voting shares of Telesat Corporation.

“Class C Shares” means, together, the Class C Fully Voting Shares and the Class C Limited Voting Shares.

“Class C Special Voting Share” means the Class C Special Voting Share of Telesat Corporation.

“Class C Units” means the Class C units of Telesat Partnership.

“Closing” means the consummation of the transactions which occurred on the First Closing Day (November 18, 2021) and the Second Closing Day (November 19, 2021).

“Exchange Act” means the Exchange Act of 1934, as amended.

“GEO” means geostationary or geosynchronous equatorial orbit.

“Golden Share” means the Golden Share without par value in the capital of Telesat Corporation.

“IFRS” means the International Financing Reporting Standards as issued by the International Accounting Standards Board.

“Independent Audit Committee Director” means a director who (i) satisfies the independence requirements of the applicable U.S. and/or Canadian securities exchanges on which the Telesat Public Shares are listed, (ii) is “independent” of Telesat Corporation within the meaning of National Instrument 52-110 — Audit Committees of the Canadian Securities Administrators and (iii) is “independent” of Telesat Corporation within the meaning of Section 10A(m)(3)(B) of the United States Securities Exchange Act of 1934.

“Investor Rights Agreements” means, together, the two separate investor rights agreements entered into between Telesat Corporation and each of MHR and PSP Investments on November 23, 2020.

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“IRS” means “Internal Revenue Service”

“LEO” means low earth orbit.

“Loral” means Loral Space & Communications Inc.

“Partnership Agreement” means the amended and restated limited partnership agreement of Telesat Partnership, entered into between Telesat Corporation, Red Isle, PSP Investments, Henry Intven, John Cashman, Clare Copeland and each other person who was admitted to Telesat Partnership as a limited partner in accordance with the provisions thereof on the First Closing Day.

“Registration Rights Agreement” means the registration rights agreement entered into between Telesat Corporation, MHR and certain of its affiliates and PSP Investments in connection with the Transaction.

“SEC” means the U.S. Securities and Exchange Commission.

“Senior Notes” means the 6.5% Senior Notes due in 2027 issued by Telesat Canada and Telesat LLC, as the co-issuer.

“Senior Secured Credit Facilities” means the two outstanding secured credit facilities comprising a revolving facility maturing in 2024 and Term Loan B maturing in 2026.

“Senior Secured Notes” means the 4.875% Senior Secured Notes due in 2027 issued by Telesat Canada and Telesat LLC, as the co-issuer.

“Special Nomination Termination Date” means the earlier of: (i) Telesat Corporation’s annual meeting of shareholders held in calendar year 2024 (unless that meeting is held more than 30 days prior to the one-year anniversary of Telesat Corporation’s annual meeting of shareholders held in calendar year 2023, in which case, Telesat Corporation’s annual meeting of shareholders held in calendar year 2025), and (ii) the Special Board Date (as defined under the section “Description of Telesat Partnership Units and GP Units — Amendments to the Partnership Agreement”).

“Special Voting Shares” means, together, the Class A Special Voting Share, the Class B Special Voting Share and the Class C Special Voting Share.

“Specially Designated Director” means a person who:

(i) is designated as a director pursuant to Article 10.2(a)(iii) of the Telesat Articles;

(ii) meets the criteria for an Independent Audit Committee Director;

(iii) is not an affiliate or associate of PSP Investments, MHR or their permitted assignees (or any of their respective affiliates);

(iv) together with such person’s immediate family and affiliates, has not received compensation or payments from PSP Investments, MHR or their permitted assignees (or any of their respective affiliates) in any of the past three (3) years in an amount in excess of US$120,000 per annum, excluding for these purposes any directors’ fees; and

(v) is Canadian.

“Telesat-to-Telesat Corporation Exchange Ratio” means 0.4136 Telesat Corporation Shares for each Telesat Common Share, Telesat Non-Voting Participating Preferred Share or Telesat Voting Participating Preferred Share (including all outstanding shares in the capital of Telesat underlying Telesat Options, Telesat Tandem SARs and Telesat RSUs).

“Telesat Articles” means the Articles of Amalgamation of Telesat Canada dated January 1, 2017 (Incorporation Number: BC1270976).

“Telesat Common Shares” means the Common Shares of Telesat Canada as defined in the Telesat Articles.

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“Telesat Control Transaction” means the consummation of a merger, amalgamation, arrangement or consolidation of Telesat Corporation, other than any transaction which would result in the holders of outstanding voting securities of Telesat Corporation (assuming the exchange of all outstanding Telesat Partnership Units for Telesat Corporation Shares) immediately prior to such transaction having at least a majority of the total voting power represented by the voting securities of the surviving entity outstanding immediately after such transaction, with the voting power of each such continuing holder relative to other continuing holders not being altered substantially in such transaction.

“Telesat Corporation Articles” means the organizational documents of Telesat Corporation, as amended and restated.

“Telesat Corporation Board” means the board of directors of Telesat Corporation.

“Telesat Corporation Shares” means, collectively, the Class A Shares, Class B Variable Voting Shares and Class C Shares of Telesat Corporation.

“Telesat Director Voting Preferred Shares” means the Director Voting Preferred Shares of Telesat Canada as defined in the Telesat Articles.

“Telesat Non-Voting Participating Preferred Shares” means the Non-Voting Participating Preferred Shares of Telesat Canada as defined in the Telesat Articles.

“Telesat Options” means options to purchase Telesat Non-Voting Participating Preferred Shares.

“Telesat Partnership Election” means an election by a Loral stockholder to receive units of Telesat Partnership pursuant to the Transaction Agreement.

“Telesat Partnership GP Units” means the general partnership units of Telesat Partnership.

“Telesat Partnership Units” means, together, the Class A Units, Class B Units and Class C Units of Telesat Partnership.

“Telesat Public Shares” means, together, the Class A Shares and Class B Variable Voting Shares of Telesat Corporation.

“Telesat RSUs” means restricted stock units that represent the right to receive Telesat Non-Voting Participating Preferred Shares.

“Telesat Tandem SARs” means tandem stock appreciation rights accompanying certain Telesat Options.

“Telesat Voting Participating Preferred Shares” means the Voting Participating Preferred Shares of Telesat as defined in the Telesat Articles.

“Transaction” means the transaction contemplated by the Transaction Agreement.

“Transaction Agreement” means the Transaction Agreement and Plan of Merger, dated as of November 23, 2020, by and among Telesat Canada, Telesat Corporation, Telesat Partnership LP, Telesat CanHold Corporation, Lion Combination Sub Corporation, Loral Space & Communications Inc., Public Sector Pension Investment Board and Red Isle Private Investments Inc.

“Trust” means the Telesat Corporation Trust, an irrevocable trust formed under the laws of the Province of Ontario pursuant to the Trust Agreement.

“Trust Agreement” means the trust agreement establishing the Trust, entered into between the settlor of the Trust and the Trustee on the First Closing Day.

“Trust Voting Agreement” means the voting agreement entered into between the Trustee, Telesat Corporation and Telesat Partnership on the First Closing Day.

“Trustee” means the trustee of the Trust, as determined from time to time in accordance with the Trust Agreement, who will initially be TSX Trust Company.

“TSX” means the Toronto Stock Exchange.

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“U.S.” means United States of America.

“USPTO” means United States Patent and Trademark Office.

“Unwind Transaction” means, collectively, (i) the conversion of all of the Class B Variable Voting Shares into Class A Shares and (ii) the other transactions, events and occurrences specified in the Telesat Corporation Articles to occur upon an Unwind Trigger, including the redemption of the Golden Share and the Special Voting Shares and the expiration of the provisions in Part 24 of the Telesat Corporation Articles.

“Unwind Trigger” means the occurrence of both clauses (i) and (ii): (i) the occurrence of any one of the following: (A) the election of Telesat Corporation (which election, until the Special Board Date, must be made with the approval of the majority of the Specially Designated Directors then in office) to effect the Unwind Transaction, if: (a) no person who is not a Canadian, or any voting group comprised of any persons who are not Canadians, in each case, beneficially owns or controls, directly or indirectly, one-third or more of the fully diluted Telesat Corporation Shares, (b) Telesat Corporation becomes widely held, such that at least 70% of the fully diluted Telesat Corporation Shares are held by holders that do not beneficially own or control, directly or indirectly (and are not members of any group that beneficially owns or controls, directly or indirectly), 10% or more of the fully diluted Telesat Corporation Shares, collectively, or are entitled to report their ownership interest in Telesat Corporation for purposes of U.S. federal securities laws on (i) Form 13F or (ii) Schedule 13G pursuant to Rule 13d-1(b) or Rule 13d-1(c) promulgated under the Exchange Act, and (c) a majority of the members of the Telesat Corporation Board remain Canadian (as defined in the Investment Canada Act) at the time of the Unwind Transaction or (B) a Change of Control; and (ii) both (1) the absence of any determination by the Telesat Corporation Board that the Unwind Transaction would constitute a breach of, or an acceleration of the performance of any obligation under, any material agreement of Telesat Corporation, in each case, within 60 days of written notice to the Telesat Corporation Board of the occurrence of any event set forth in (i) above; provided, however, that in the event of the occurrence of a Change of Control, the fact that such occurrence could be deemed as a Change of Control under Telesat Corporation’s outstanding indebtedness or other material agreements shall be excluded for purposes of this subclause (1) if such indebtedness is refinanced or intended to be refinanced in connection with the occurrence of such Change of Control; and (2) receipt by Telesat Corporation of all required governmental authorizations for the Unwind Transaction.

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PART I

ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

Not applicable.

ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE

Not applicable.

ITEM 3. KEY INFORMATION

A. Reserved

B. Capitalization and Indebtedness

Not applicable.

C. Reasons for the Offer and Use of Proceeds

Not applicable.

D. Risk Factors

RISK FACTORS

Investing in our Telesat Public Shares involves a high degree of risk. You should carefully consider the risks and uncertainties described below, together with all of the other information contained in this annual report, including our consolidated financial statements and the related notes appearing at the end of this annual report, before deciding to invest in our Telesat Public Shares. Other risks and uncertainties that we do not presently consider to be material, or of which we are not presently aware, may become important factors that affect our future financial condition and financial performance. If any of those or the following risks actually occur, our business, financial condition, financial performance, liquidity and prospects could suffer materially, the trading price of our Telesat Public Shares could decline and you could lose all or part of your investment. See also “Special Note Regarding Forward-Looking Statements.”

Summary of Risks

Risks Relating to the Business of Telesat

• Telesat’s in-orbit satellites may fail to operate as expected due to operational anomalies resulting in lost revenues, increased costs and/or termination of contracts.

• Changes in consumer demand for traditional television services and expansion of terrestrial networks have adversely impacted the growth in subscribers to direct-to-home (“DTH”) television services in North America, which may continue to adversely impact revenues. Fluctuations in available satellite capacity could also adversely affect Telesat’s results.

• Significant and intensifying competition in the satellite industry and from other providers of communications capacity is expected to result in a loss of revenues and a decline in profitability of Telesat if it fails to compete effectively.

• Changes in technology could have a material adverse effect on Telesat’s results.

Risks Relating to Telesat’s Lightspeed Constellation

• There are numerous risks and uncertainties associated with Telesat’s planned Lightspeed constellation. Failure to develop significant commercial and service operational capabilities in connection with the Lightspeed constellation could prevent it from achieving commercial viability. Telesat may proceed with the Lightspeed constellation and it may not be successful, Telesat may ultimately choose to not proceed

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with the Lightspeed constellation or Telesat may be unable to raise sufficient capital to fund the Lightspeed constellation, any of which could have a material adverse effect on Telesat’s results of operations, business prospects and financial condition.

• Telesat’s Lightspeed constellation will depend on the use of spectrum; regulations governing non-geostationary orbit (“NGSO”) spectrum rights, including requirements to share spectrum, could materially impact the Lightspeed constellation’s system capacity.

Risks Relating to Regulatory Matters

• Telesat’s operations may be limited or precluded by the rules or processes of the International Telecommunication Union (“ITU”), and it is required to coordinate its operations with those of other satellite operators.

• Telesat operates in a highly regulated industry and government regulations may adversely affect its ability to access certain markets, sell its services, or increase the price of such services or otherwise limit its ability to operate or grow its business.

Risks Relating to Telesat’s Liquidity and Capital Resources

• Telesat’s level of indebtedness is expected to increase, reducing its financial flexibility and making it more difficult to repay or refinance its indebtedness.

• Telesat’s business is capital intensive, and restrictions on its ability to incur additional debt and to take other actions may significantly impair its ability to obtain other financing.

Risks Relating to Tax Matters

• The acquisition, ownership and disposition of Telesat Public Shares and Telesat Partnership Units may have adverse U.S. tax consequences for shareholders of Telesat Corporation, including: Telesat Corporation may have been a passive foreign investment company (a “PFIC”) for 2021, 2022 or 2023 and could be classified as a PFIC in 2024 and subsequent taxable years; Telesat Corporation or Telesat Partnership could be treated as a U.S. corporation or as a surrogate foreign corporation for U.S. federal income tax purposes and Loral could be treated as an expatriated entity; the IRS could recharacterize the receipt of Telesat Partnership Units as a receipt of Telesat Public Shares; and non-U.S. holders of Telesat Partnership Units will generally be subject to U.S. withholding with respect to dividends received by Telesat Partnership from Loral.

• The acquisition, ownership and disposition of Telesat Public Shares and Telesat Partnership Units may have adverse Canadian tax consequences for shareholders of Telesat Corporation and partners of Telesat Partnership.

Risks Relating to the Ownership of Telesat Public Shares and Telesat Partnership Units

• Each of MHR and PSP Investments have substantial governance rights over Telesat, and their interests may differ from the interests of the other Telesat Corporation shareholders.

• Telesat may raise additional equity capital to fund Telesat Lightspeed which could result in potential substantial ownership dilution to the shareholders of Telesat Corporation and holders of Telesat Partnership Units.

• Telesat has certain indemnification and post-Closing obligations to PSP Investments, which in certain circumstances will be uncapped and may result in dilution to the other shareholders of Telesat Corporation and holders of Telesat Partnership Units.

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Risks Relating to the Business of Telesat Corporation

Telesat’s in-orbit satellites may fail to operate as expected due to operational anomalies resulting in lost revenues, increased costs and/or termination of contracts.

Satellites utilize highly complex technology and operate in the harsh environment of space and therefore are subject to significant operational risks while in orbit. These risks include in-orbit equipment failures, malfunctions and other kinds of problems commonly referred to as anomalies. Satellite anomalies include, for example, circuit failures, transponder failures, solar array failures, telemetry subsystem failures, battery cell and other power system failures, satellite control system failures and propulsion system failures. Some of Telesat Corporation’s satellites have had malfunctions and other anomalies in the past. See “— Some of Telesat Corporation’s satellites have experienced in-orbit anomalies and may in the future experience further anomalies that may affect their performance.” Acts of war, terrorism, magnetic, electrostatic or solar storms, space debris, satellite conjunctions or micrometeoroids could also damage satellites.

Satellite anomalies are likely to be experienced in the future, and may include the types of anomalies described above or may arise from failures in other systems or components. Despite working closely with satellite manufacturers to determine the causes of anomalies and mitigate them in new satellites and to provide for intra-satellite redundancies for certain critical components to minimize or eliminate service disruptions in the event of failure, Telesat cannot assure you that, in these cases, it will be possible to restore normal operations. Where service cannot be restored, the failure could cause the satellite to have less capacity available for sale, to suffer performance degradation or to cease operating prematurely, either in whole or in part.

Any single anomaly or series of anomalies or other failure (whether full or partial) of any of Telesat’s satellites could cause revenues, cash flows and backlog to decline materially, could require Telesat to repay prepayments made by customers of the affected satellite and could have a material adverse effect on relationships with current customers and Telesat’s ability to attract new customers for satellite services. A failure could result in a customer terminating its contract for service on the affected satellite. If Telesat is unable to provide alternate capacity to an affected customer, the customer may decide to procure all or a portion of its future satellite services from an alternate supplier or the customer’s business may be so adversely affected by the satellite failure that it may not have the financial ability to procure future satellite services. It may also require that Telesat expedite a satellite replacement program, adversely affecting Telesat’s profitability, increasing its financing needs and limiting the availability of funds for other business purposes. Finally, the occurrence of anomalies may adversely affect Telesat’s ability to insure satellites at commercially reasonable premiums, if at all, and may cause insurers to demand additional exclusions in policies they issue.

Because Telesat’s satellites are complex and are deployed in complex environments, Telesat’s satellites may have defects that are discovered only after full deployment, which could seriously harm Telesat’s business.

Telesat produces highly complex satellites that incorporate leading-edge technology. Telesat’s products are complex and are designed to be deployed across complex networks, which in some cases may include over a million users. Because of the nature of these satellites, there is no assurance that Telesat’s pre-launch testing programs will be adequate to detect all defects. As a result, Telesat’s customers may discover errors or defects in its satellites, or Telesat’s satellites may not operate as expected, after they have been launched and entered service. If Telesat is unable to resolve an anomaly, Telesat could experience damage to its reputation, reduced customer satisfaction, loss of existing customers and failure to attract new customers, failure to achieve market acceptance, cancellation of orders, loss of revenues, reduction in backlog and market share, increased service and warranty costs, diversion of development resources, legal actions by Telesat’s customers, issuance of credit to customers and increased insurance costs. Defects, integration issues or other performance problems in Telesat’s satellites could also result in financial or other damages to Telesat’s customers. Telesat’s customers could seek damages for related losses from Telesat, which could seriously harm Telesat’s business, financial condition and results of operations. The occurrence of any of these problems would seriously harm Telesat’s business, financial condition and results of operations.

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Some of Telesat’s satellites have experienced in-orbit anomalies and may in the future experience further anomalies that may affect their performance.

A number of Telesat’s in-orbit satellites have experienced anomalies and may in the future experience further anomalies that may affect their performance. Past anomalies include:

Nimiq Satellites:

A number of Lockheed Martin’s A2100 series satellites have suffered in-orbit failures of circuits on their solar arrays. Lockheed Martin has determined that Nimiq 2 is in the family of spacecraft that is susceptible to this anomaly.

In February 2003, Nimiq 2 experienced an anomaly affecting the available power on the satellite. Lockheed Martin concluded the most likely cause of this anomaly was an electrical short-circuit caused by foreign object debris located in a single power-carrying connector. As a result of this anomaly, the south solar array power cannot be recovered. In addition, Nimiq 2 has experienced solar array circuit failures, resulting in a significant reduction of available power. These failures have substantially reduced the number of transponders Telesat can operate at saturation and it is currently expected that the available capacity will be further reduced over time. In April 2005, another satellite operator reported that a satellite of the same series as Nimiq 2 suffered a solar array anomaly that resulted in the complete loss of one array and a corresponding 50% reduction in available satellite power. Lockheed Martin, the manufacturer, has traced the most likely cause of this failure to a component on the solar array drive. Nimiq 2 has this component in its remaining functioning solar array. If this same component were to fail on the functioning array of Nimiq 2, it would result in a total loss of service of the satellite.

In January 2024, Nimiq 4 suffered a failure of a north/south thruster. Normal station-keeping operations continue utilizing a redundant thruster. If the redundant thruster were to fail, and alternative operational approaches cannot be developed, the satellite would need to transition to inclined operations.

Anik Satellites:

Anik F1 was designed with the capability to cover both North America and South America from the 107.3° WL orbital location. In August 2001, Boeing, the manufacturer of the Anik F1 satellite, advised Telesat of a gradual decrease in available power on-board the satellite. Boeing investigated the cause of the power loss and reported that the power will continue to degrade. Telesat procured a replacement satellite, Anik F1R, which was launched in 2005. The North American traffic on Anik F1 was transferred to Anik F1R. Anik F1 continued to provide coverage of South America until December 2020. Anik F1 was recently moved to the 109.2° WL orbital location where it commenced inclined orbit operations.

Telesat has experienced and continues to experience intermittent anomalies with certain amplifiers in the Ka-band and Ku-band payloads on Anik F2. Boeing, the manufacturer, has completed its investigation of these anomalies. The majority of the affected Ka-band units continue to remain in service through modifying operational configurations. The Ku-band traveling-wave-tube amplifiers (“TWTAs”) that were affected as a result of these anomalies have failed. All but two of the failed transponders were replaced using spares and many of the Ku-band TWTAs currently in service have no further spares left to replace them should they fail. Anik F2 has experienced an anomaly with one of its two telemetry transmitters. While the failure of a single telemetry transmitter does not impact satellite operations or the service Telesat provides to its customers, in the event Telesat is unable to restore any redundancy and the second telemetry transmitter were to fail, Telesat would cease receiving important information from the satellite regarding its position in orbit and health and Telesat’s ability to operate the satellite would be adversely affected. A software patch for the satellite was developed by Boeing to provide telemetry to support operations in the event of a failure of the second transmitter and was implemented on the satellite in February 2013. Telesat’s Anik F2 satellite has also experienced anomalies on two of the station-keeping thrusters. One of the thrusters has failed while the second continues to be capable of supporting some operations with some constraints. Alternative operational methods were implemented to enable continued operations utilizing the remaining thrusters. The alternative operational methods were less fuel efficient and as a consequence, there was a reduction in the station kept lifetime of the satellite and the satellite commenced inclined orbit operations in December 2022. There is a small Ka-band payload on Anik F3 which experienced an anomaly following launch. Telesat implemented a plan to remedy the effect of this anomaly and the Ka-band payload is currently operational.

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Telstar 11N has experienced anomalies with one of the two batteries that have resulted in a loss of redundancy in the Battery 1 charging system. In the event of another failure in the Battery 1 charge electronics system the satellite will be required to be operated using Battery 2 only.

Telstar Satellites:

Telstar 12 VANTAGE began to suffer from degraded performance of four channels in late December 2016 due to increased noise levels. Following an investigation with the satellite manufacturer, the root cause of the anomaly was determined. As a result of this degradation, two channels on T12V are no longer usable. In 2017, Telesat received insurance proceeds in connection with this anomaly. Degradation of performance was observed on additional channels in May 2018 due to increased noise levels. The satellite manufacturer investigation concluded that the root cause of the anomaly was similar to that of the 2016 anomaly. The channels continue to support service. In the event of further degradation, Telesat may lose the capability to continue to use two channels.

Telstar 14R/Estrela do Sul 2’s North solar array was damaged after launch and only partially deployed, diminishing the power and expected orbital maneuver life of the satellite. In July 2011, the satellite began commercial service with substantially reduced available transponder capacity and with an expected end-of-orbital maneuver life reduced to 2025. It is currently expected that the available transponder capacity will be reduced over time. If the damaged solar array on Telstar 14R/Estrela do Sul 2 were to unexpectedly deploy in the future this could result in a loss of capability to provide service. In September 2016, the primary gyro utilized to maintain operational pointing of the satellite exhibited degraded performance. The backup gyro unit was switched into service and is currently in operation. A ground-based system has been implemented, which provides the capability to operate the satellite in the absence of a functioning on-board gyro. This system will reduce the demands on the backup gyro unit and provide redundancy.

Telstar 19 VANTAGE has suffered a number of failures of heaters that support the operation of two of the three battery packs on the satellite. There is a risk that the satellite may experience additional heater failures. The functionality of the batteries and services on Telstar 19 VANTAGE have not been impacted by the failures thus far. Tests performed in orbit and on the ground have validated operational workarounds that Telesat can implement to maintain battery function in the event Telstar 19 VANTAGE were to suffer additional heater failures on the batteries.

In general, Telesat’s satellites are exposed to the potential risk of financial loss. See “— Telesat’s in-orbit satellites may fail to operate as expected due to operational anomalies resulting in lost revenues, increased costs and/or termination of contracts.”

The actual orbital maneuver lives of Telesat satellites may be shorter than it anticipates, and it may be required to reduce available capacity on its satellites prior to the end of their orbital maneuver lives.

For all but one of Telesat’s geostationary (“GEO”) satellites, the current expected end-of-orbital maneuver life date goes beyond the manufacturer’s end-of-service life date. A number of factors will affect the actual commercial service lives of Telesat satellites, including: the amount of propellant used in maintaining the satellite’s orbital location or relocating the satellite to a new orbital location (and, for newly-launched satellites, the amount of propellant used during orbit raising following launch); the durability and quality of their construction; the performance of their components; conditions in space such as solar flares and space debris; operational considerations, including operational failures and other anomalies; and changes in technology which may make all or a portion of its satellite fleet obsolete.

Telesat has been forced to remove satellites from service prematurely in the past due to an unexpected reduction in their previously anticipated end-of-orbital maneuver life. It is possible that the actual orbital maneuver lives of one or more of the existing satellites may also be shorter than currently anticipated. Further, on some of the satellites it is anticipated that the total available payload capacity may need to be reduced prior to the satellite reaching its end-of-orbital maneuver life.

Telesat periodically reviews the expected orbital maneuver life of each of its satellites using current engineering data. A reduction in the orbital maneuver life of any of the satellites could result in a reduction of the revenues generated by that satellite, the recognition of an impairment loss and an acceleration of capital expenditures. To the extent Telesat is required to reduce the available payload capacity prior to the end of a satellite’s orbital maneuver life, revenues from the satellite would be reduced.

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Telesat’s insurance will not protect it against all satellite-related losses. Further, Telesat may not be able to renew insurance on its existing satellites or obtain insurance on future satellites on acceptable terms or at all, and, for certain of its existing satellites, Telesat has elected to forego obtaining insurance.

Telesat’s current satellite insurance does not protect it against all satellite-related losses that it may experience, and it does not have in-orbit insurance coverage for all of the satellites in its fleet. As of December 31, 2023, the total net book value of Telesat’s nine in-orbit GEO satellites for which Telesat does not have insurance (Nimiq 2, Anik F1, Anik F1R, Anik F2, Anik F3, Anik F4, Telstar 11N, Telstar 14R and ViaSat-1) was approximately $22.2 million. Telesat’s insurance does not protect it against business interruption, loss of revenues or delay of revenues. Telesat’s existing launch and in-orbit insurance policies include specified exclusions, deductibles and material change limitations, and future insurance policies are expected to continue to include such features. Typically, these insurance policies exclude coverage for damage or losses arising from acts of war, antisatellite devices, electromagnetic or radio frequency interference and other similar potential risks for which exclusions are customary in the industry at the time the policy is written. In addition, they typically exclude coverage for satellite health-related problems affecting the satellites that are known at the time the policy is written or renewed. Any claims under existing policies are subject to settlement with the insurers and may, in some instances, be payable to Telesat’s customers.

The price, terms and availability of satellite insurance has fluctuated significantly in recent years. These fluctuations may be affected by recent satellite launch or in-orbit failures and general conditions in the insurance industry. Launch and in-orbit policies on satellites may not continue to be available on commercially reasonable terms or at all. To the extent Telesat experiences a launch or in-orbit failure that is not fully insured, or for which insurance proceeds are delayed or disputed, Telesat may not have sufficient resources to replace the affected satellite. In addition, higher premiums on insurance policies increase costs, thereby reducing profitability. Future insurance policies may also have higher deductibles, shorter coverage periods, higher loss percentages required for constructive total loss claims and additional satellite health-related policy exclusions, all of which would reduce Telesat’s expected profitability. There can be no assurance that, upon the expiration of an in-orbit insurance policy, which typically has a term of one year, Telesat will be able to renew the policy on terms acceptable to it. Telesat may elect to reduce or eliminate insurance coverage for certain of its existing satellites, or elect not to obtain insurance policies for its future satellites, especially if exclusions make such policies ineffective, the costs of coverage make such insurance impractical or self-insurance is deemed more cost effective. In 2023, satellite insurance markets deteriorated, with substantial increases in premium rates and requests from insurers for satellite health-related policy exclusions. As a result, Telesat reduced or in some cases eliminated insurance coverage on its existing satellites.

Telesat derives a substantial amount of its revenues from only a few of its customers. A loss of, or default by, one or more of these major customers, or a material adverse change in any such customer’s business or financial condition, could materially reduce Telesat’s future revenues and contracted backlog.

For the year ended December 31, 2023, Telesat’s top five customers together accounted for approximately 61% of its revenues. As at December 31, 2023, Telesat’s top five backlog customers together accounted for approximately 82% of its backlog. If any of its major customers were to terminate, or choose not to renew, their contracts at the expiration of the existing terms or are able to negotiate concessions, particularly on price, it could have a material adverse effect on results of operations, business prospects and financial condition. Telesat customers could experience a downturn in their business, find themselves in financial difficulties, allege Telesat is in breach of its obligation to them and purport to terminate their contracts, any of which could result in their ceasing or reducing their use of Telesat services, becoming unable or refusing, to pay for services they had contracted to buy. In addition, some of Telesat’s customers’ industries are undergoing significant consolidation, and Telesat customers may be acquired by each other or other companies, including by Telesat competitors. Such acquisitions could adversely affect Telesat’s ability to sell services to such customers and to any end-users whom they serve. Some customers have in the past defaulted, and customers may in the future default, on their obligations to Telesat due to bankruptcy, lack of liquidity, operational failure or other reasons. Such defaults could adversely affect revenues, operating margins and cash flows. If Telesat’s contracted revenue backlog is reduced due to the financial difficulties of, or disputes with, its customers, revenues, operating margins and cash flows would be further negatively impacted.

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Telesat’s business is capital intensive and it may not be able to raise adequate capital to finance its business strategies, or it may be able to do so only on terms that significantly restrict its ability to operate its business.

Implementation of Telesat’s business strategy requires a substantial outlay of capital. As it pursues its business strategies and seeks to respond to developments in its business and opportunities and trends in its industry, Telesat’s actual capital expenditures may differ from expected capital expenditures. There can be no assurance that Telesat will be able to satisfy capital requirements in the future. In addition, if one of its satellites fails unexpectedly, there is no assurance of insurance recovery or the timing thereof and Telesat may need to exhaust or significantly draw upon its Amended Revolving Credit Facility or obtain additional financing to replace the satellite. If Telesat determines it needs to obtain additional funds through external financing and is unable to do so, it may be prevented from fully implementing its business strategy.

The availability and cost to Telesat of external financing depends on a number of factors, including its credit rating and financial performance and general market conditions. Telesat’s ability to obtain financing generally may be influenced by the supply and demand characteristics of the telecommunications sector in general and of the satellite services sector in particular. Declines in Telesat revenues and the challenging business conditions faced by Telesat customers are among the other factors that may adversely affect Telesat’s credit, access to the capital markets and ability to refinance its existing debt. Other factors that could negatively impact Telesat’s credit, access to the capital markets and ability to refinance its existing debt include the amount of debt in its current capital structure and the expected increase in its debt, activities associated with strategic initiatives, the health of its satellites, the success or failure of its planned launches, its expected future cash flows and the capital expenditures required to execute its business strategy. The overall impact on its financial condition of any transaction that it pursues may be negative or may be negatively perceived by the financial markets and rating agencies and may result in adverse rating agency actions with respect to Telesat’s credit rating and access to the capital markets. Long-term disruptions in the capital or credit markets as a result of uncertainty, inflation, rising interest rates or recession, changing or increased regulation or failures of significant financial institutions could adversely affect its access to capital. A credit rating downgrade or deterioration in Telesat’s financial performance or general market conditions could limit its ability to obtain financing or could result in any such financing being available only at greater cost or on more restrictive terms than might otherwise be available and, in either case, could result in Telesat deferring or reducing capital expenditures, including on new or replacement satellites, or being unable to refinance its debt.

Telesat satellite launches may be delayed, it may suffer launch failures or its satellites may fail to reach their planned orbital locations. Any such issue could result in the loss of a satellite or cause significant delays in the deployment of the satellite which could have a material adverse effect on results of operations, business prospects and financial condition.

Delays in launching satellites and in the deployment of satellites are not uncommon and result from construction delays, the unavailability of reliable launch opportunities with suppliers, delays in obtaining required regulatory approvals and launch failures. If satellite construction schedules are not met, a launch opportunity may not be available at the time the satellite is ready to be launched. Satellites are also subject to certain risks related to failed launches. Launch vehicles may fail. Launch failures result in significant delays in the deployment of satellites because of the need to construct replacement geostationary satellites, which can take up to 30 months or longer, and to obtain another launch vehicle. A delay or perceived delay in launching a satellite, or replacing a satellite, may cause Telesat’s current customers to move to another satellite provider if they determine that the delay may cause an interruption in continuous service. In addition, Telesat’s contracts with customers who purchase or reserve satellite capacity may allow the customers to terminate their contracts in the event of a delay. Any such termination would require Telesat to refund any prepayment it may have received, and would result in a reduction in its contracted backlog and would delay or prevent it from securing the commercial benefits of the new satellite.

Replacing a satellite upon the end of its service life will require Telesat to make significant expenditures and may require it to obtain shareholder approval and Telesat may choose not to, or be unable to, replace some of its satellites upon their end of life.

In order to replace a GEO satellite prior to its end of service life, the construction of a replacement GEO satellite must commence approximately three to five years prior to the expected end of service life of the satellite then in orbit. Typically, the construction, launch and insurance of a GEO satellite costs in the range of US$200,000,000 to US$500,000,000. There is no assurance that Telesat will have sufficient cash, cash flow or be able to obtain third-party

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or shareholder financing to fund such expenditures on favorable terms, if at all. Moreover, the Telesat Articles provide that the power of Telesat’s board to issue securities of Telesat cannot be delegated to a committee, and, consequently, so long as designees of PSP Investments and MHR hold a combined majority of the seats on Telesat’s board, the approval of at least the designees of PSP Investments or of MHR is required for Telesat to issue securities. In the event that Telesat determines to finance expenditures to replace satellites by issuing securities, such designees could block such a financing.

Certain of Telesat’s satellites are nearing their expected end-of-orbital maneuver lives. Should Telesat not have sufficient funds available to replace those satellites or Telesat be unable to finance such replacements, because of PSP Investments’ and MHR’s determining not to approve such financing or otherwise, it could have a material adverse effect on Telesat’s results of operations, business prospects and financial condition.

In order to justify the cost of replacing a satellite at the end of its life, there must be sufficient demand for services, and sufficient spectrum available to Telesat to provide those services, such that a reasonable business case can be made for its replacement. If there is insufficient demand for a replacement, or if Telesat does not have sufficient spectrum available to it, as a result of the repurposing of C-band and/or Ka-band spectrum for terrestrial use or otherwise, Telesat may choose not to replace a satellite at the end of its life.

In the event we are unable or choose not to replace a satellite at the end of its life, if we want to maintain the revenues from customers on these satellites, we will need to provide them with alternate capacity and acquiring such alternate capacity may increase our costs of providing services. We do not intend to replace all our satellites that are nearing their end of life. While we are currently considering the potential to extend the life of certain of our satellites nearing their end of life, there can be no assurance that we will acquire any life extension services or that such life extension services would be successful. For some of our GEO satellites, we intend to provide continuity of service to our customers at the end of life of those satellites by transitioning services to our Lightspeed constellation. Given that the entry into service of our Lightspeed constellation is expected to occur after certain of our GEO satellites have reached their end-of-life, we may be unable to provide many of our customers on satellites nearing their end of life with continuity of service. If we are unable to provide continuity of service to our customers by extending the life of such satellites, providing alternate capacity on other satellites, including our Lightspeed constellation, our revenue would decline.

Telesat may experience a failure of ground operations infrastructure or interference with its satellite signals that impairs the commercial performance of, or the services delivered over, its satellites or the satellites of other operators for whom it provides ground services, or its satellites may be adversely impacted by anti-satellite weapons, which could result in a material loss of revenues.

Telesat operates an extensive ground infrastructure including its satellite control centre in Ottawa, its main earth station and back up satellite control facility at Allan Park, Ontario, nine other earth stations throughout Canada, two teleports in the U.S. and one teleport located in Brazil. These ground facilities are used for controlling Telesat’s satellites and/or for the provision of end-to-end services to its customers.

Telesat may experience a partial or total loss of one or more of these facilities due to natural disasters (tornado, flood, hurricane or other such acts of God), fire, acts of war or terrorism or other catastrophic events. A failure at any of these facilities could cause a significant loss of service for its customers. Additionally, it may experience a failure in the necessary equipment at the satellite control center, at the back-up facility, or in the communications links between these facilities and remote earth station facilities. A failure or operator error affecting tracking, telemetry and control operations might lead to a breakdown in the ability to communicate with one or more satellites or cause the transmission of incorrect instructions to the affected satellite(s), which could lead to a temporary or permanent degradation in satellite performance or to the loss of one or more satellites. Intentional or non-intentional electromagnetic or radio frequency interference could result in a failure of its ability to deliver satellite services to customers.

Anti-satellite weapons may be tested or employed upon Telesat’s satellites or third-party satellites, which could result in the direct loss of a Telesat satellite and/or may result in significant increases in orbital debris which may extend to the orbits utilized by Telesat satellites. Increased levels of orbital debris will increase the chance that Telesat satellites may be damaged or destroyed. Utilization of Telesat satellites for government services could result in our satellites being targeted by anti-satellite weapons.

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A failure at any of Telesat’s satellites, facilities or in the communications links between facilities or interference with its satellite signal could cause revenues and backlog to decline materially and could adversely affect its ability to market its services and generate future revenues and profit.

Telesat purchases equipment from third-party suppliers and depends on those suppliers to deliver, maintain and support these products to the contracted specifications in order for it to meet its service commitments to its customers. Telesat may experience difficulty if these suppliers do not meet their obligations to deliver and support this equipment. Telesat may also experience difficulty or failure when implementing, operating and maintaining this equipment, or when providing services using this equipment. This difficulty or failure may lead to delays in implementing services, service interruptions or degradations in service, which could cause revenues and backlog to decline materially and could adversely affect Telesat’s ability to market its services and generate future revenues and profit.

Telesat’s dependence on outside contractors could result in delays related to the design, manufacture and launch of new satellites, or could limit its ability to sell its services, which could adversely affect operating results and prospects.

Any delays in the design, construction or launch of its satellites could have a material adverse effect on Telesat’s results of operations, business prospects and financial condition. There are a limited number of manufacturers that are able to design and build satellites according to the technical specifications and standards of quality Telesat requires, including Airbus Defence and Space, Thales Alenia Space, Boeing, Lockheed Martin, MDA, MELCO, Northrop Grumman (formerly Orbital) and Maxar. Telesat also relies on the manufacturers of its satellites to provide support throughout the life of the satellite in the event it should suffer an anomaly. If any of its manufacturers’ businesses fail, it could adversely impact Telesat’s ability to overcome a satellite anomaly and maintain its satellites in service, in whole or in part. There is also a limited number of suppliers able to launch such satellites, including Arianespace, ISRO, Mitsubishi Heavy Industries, Rocket Lab, SpaceX, Blue Origin and United Launch Alliance. Should any of its manufacturers’ or launch suppliers’ businesses fail, it would reduce competition and could increase the cost of satellites and launch services. Adverse events with respect to any of Telesat’s manufacturers or launch suppliers could also result in the delay of the design, construction or launch of satellites. Certain launch providers may be unavailable to us either because they are unwilling to provide us with services, because they compete with us or for other reasons, or because we are unable to access their services for regulatory reasons, including as a result of government sanctions.

General economic conditions may also affect the ability of Telesat’s manufacturers and launch suppliers to provide services on commercially reasonable terms or to fulfil their obligations in terms of manufacturing schedules, launch dates, pricing or other items. Even where alternate suppliers for such services are available, Telesat may have difficulty identifying them in a timely manner, it may incur significant additional expense in changing suppliers, and this could result in difficulties or delays in the design, construction or launch of satellites.

Changes in consumer demand for traditional television services and expansion of terrestrial networks have adversely impacted the growth in subscribers to DTH television services in North America, which have adversely impacted current and may adversely impact future revenues.

A substantial amount of Telesat’s revenue is earned from customers who use its services to provide DTH television services to the public in North America. For the year ended December 31, 2023, approximately 95% of Telesat’s broadcast revenue was derived from North American DTH television services. For various reasons, the number of DTH subscribers to whom Telesat’s customers provide services has been decreasing. In many regions of the world, including North America, the terrestrial networks with which Telesat competes continue to expand. Terrestrial networks have advantages over traditional DTH services for the delivery of two-way services, such as on-demand video services or “over-the-top” (“OTT”) video distribution (e.g., Netflix). The growth of on demand and OTT distribution has had a negative impact on the demand for the services of Telesat’s large DTH customers, which has decreased, and is expected to continue to decrease, demand for Telesat’s broadcast satellite capacity. Moreover, two of Telesat’s largest DTH customers also have substantial terrestrial broadcast distribution networks that they are continuing to expand, which has led to certain of their own DTH customers migrating to their terrestrial network. The migration of DTH customers to terrestrial networks, in order to access improved two-way services or for other reasons, is expected to continue to decrease the demand for Telesat’s services, adversely impacting future revenue and financial performance.

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Reductions in government spending could reduce demand for Telesat’s services.

Governments purchase a substantial amount of satellite services from commercial satellite operators, including Telesat. Spending authorizations for defense-related and other programs by governments, in particular the Canadian and U.S. governments, have fluctuated in the past, and future levels of expenditures and authorizations for these programs may decrease, remain constant or shift to programs in areas where Telesat does not provide services. To the extent governments and their agencies reduce spending on commercial satellite services, this could adversely affect Telesat’s revenue and operating margins. Many governments provide funding for satellite services that are used to provide broadband connectivity to rural and remote communities and those with limited terrestrial infrastructure. To the extent these governments reduce spending on satellite services, as a result of the need to reduce overall spending during periods of fiscal restraint, to reduce budget deficits or otherwise, demand for Telesat’s services could decrease which could adversely affect revenue, the prices it is able to charge for its services and results of operations, business prospects and financial condition.

Telesat’s failure to maintain or obtain authorizations under and comply with the U.S. export control and trade sanctions laws and regulations could have a material adverse effect on results of operations, business prospects and financial condition.

The export of satellites and technical data related to satellites, earth station equipment and provision of services are subject to U.S. export control and economic sanctions laws, implemented by U.S. State Department, Department of Commerce and Department of the Treasury regulations. If Telesat does not maintain its existing authorizations or obtain necessary future authorizations under the export control laws and regulations of the U.S., it may be unable to export technical data or equipment to non-U.S. persons and companies, including to its own non-U.S. employees, as required to fulfil existing contracts. If it does not maintain its existing authorizations or obtain necessary future authorizations under the trade sanctions laws and regulations of the U.S., it may not be able to provide satellite capacity and related administrative services to certain countries subject to U.S. sanctions. Telesat’s ability to acquire new U.S.-manufactured satellites, procure launch services and launch new satellites, operate existing satellites, obtain insurance and pursue its rights under insurance policies or conduct its satellite-related operations and consulting activities could also be negatively affected if Telesat and its suppliers are not able to obtain and maintain required U.S. export authorizations.

The content of third-party transmissions over Telesat satellites could subject Telesat to sanctions by various governmental entities for the transmission of certain content.

Telesat provides satellite capacity for transmissions by third parties. Telesat does not decide what content is transmitted over its satellites, although its contracts generally provide Telesat with rights to prohibit certain types of content or to cease transmission or permit it to require its customers to cease their transmissions under certain circumstances. A governmental body or other entity may object to some of the content carried over Telesat’s satellites, such as “adult services” video channels or content deemed political in nature. Issues arising from the content of transmissions by these third parties over Telesat’s satellites could affect its future revenues, operations or its relationship with certain governments or customers.

Fluctuations in available satellite capacity could adversely affect Telesat’s results.

The availability of satellite capacity has fluctuated over time, characterized by periods of undersupply of capacity, followed by periods of substantial new satellite construction which is, in turn, followed by an oversupply of available capacity. The industry appears to be currently experiencing a period of oversupply. Given the number of new satellites launched over the past several years, many of which contain high throughput payloads, as well as the number of satellite constellations being deployed and under development, if the demand for satellite capacity does not increase as expected, the next several years are likely to continue to be characterized by an oversupply of capacity. In addition, changes in technology could introduce a substantial amount of new capacity into the market, further exacerbating the oversupply problem. An oversupply of capacity leads to a decrease in rates charged for satellite services, which could adversely affect Telesat’s results of operations and cash flows.

Developments that Telesat expects to support the growth in demand for satellite services, such as continued growth in corporate data and internet traffic and low earth orbit constellations expanding the total addressable market, may fail to materialize or may not occur in the manner or to the extent anticipated.

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Telesat is subject to risks associated with doing business internationally.

Telesat’s operations internationally are subject to risks that are inherent in conducting business globally. It is subject to compliance with the U.S. Foreign Corrupt Practices Act (“FCPA”) and other similar anti-corruption laws, which generally prohibit companies and their intermediaries from making improper payments to foreign government officials for the purpose of obtaining or retaining business. While its employees and contractors are required to comply with these laws, Telesat cannot be sure that its internal policies and procedures will always protect it from violations of these laws, despite its commitment to legal compliance and corporate ethics. Violations of these laws may result in severe criminal and civil sanctions as well as other penalties, and the U.S. Securities and Exchange Commission and U.S. Department of Justice have increased their enforcement activities with respect to the FCPA. The occurrence or allegation of these types of risks may adversely affect Telesat’s business, performance, financial condition, and results of operations.

Telesat is subject to significant and intensifying competition within the satellite industry and from other providers of communications capacity. A failure to compete effectively would result in a loss of revenues and a decline in profitability, which would adversely affect Telesat’s results of operations, business prospects and financial condition.

Telesat provides point-to-point and point-to-multipoint services for voice, data and video communications and for high-speed internet access. Telesat competes against global competitors who are substantially larger than us in terms of both the number of satellites in orbit as well as in terms of revenues. Due to their larger sizes, these operators are able to take advantage of greater economies of scale, may be more attractive to customers, may have greater flexibility to restore service to their customers in the event of a partial or total satellite failure and may be able to offer expansion capacity for future requirements. Telesat also competes against regional satellite operators who may enjoy competitive advantages in their local markets.

Telesat’s business is also subject to competition from ground-based forms of communications technology. For many point-to-point and other services, the offerings provided by terrestrial companies can be more competitive than the services offered via satellite. A number of companies are increasing their ability to transmit signals on existing terrestrial infrastructures, such as fiber optic cable, DSL (digital subscriber line) and terrestrial wireless transmitters often with funding and other incentives provided by government. The ability of any of these companies to increase their capacity and/or the reach of their network significantly would likely result in a decrease in the demand for Telesat’s services. Increasing availability of capacity from other forms of communications technology can create an excess supply of telecommunications capacity, decreasing the prices Telesat would be able to charge for its services under new service contracts and thereby negatively affecting profitability. New technology could render satellite-based services less competitive by satisfying consumer demand in other ways. See: “Changes in technology could have a material adverse effect on Telesat’s results of operations, business prospects and financial condition”. Telesat also competes for local regulatory approval in places where more than one provider may want to operate, and with other satellite operators for scarce frequency assignments and a limited supply of orbital locations.

A failure to compete effectively could result in a loss of revenues and a decline in profitability, a decrease in the value of Telesat’s business and a downgrade of Telesat’s credit rating, which would restrict its access to the capital markets.

Spectrum values historically have been volatile, which could cause the value of Telesat’s business to fluctuate.

A material amount of Telesat’s asset value is derived from Telesat’s spectrum authorizations. Valuations of spectrum in other frequency bands historically have been volatile, and Telesat cannot predict any future change in the value of Telesat’s spectrum and other assets. In addition, to the extent that the International Telecommunication Union (“ITU”) or any governmental authority takes action that makes additional spectrum available or promotes the more flexible use or greater availability of existing satellite or terrestrial spectrum allocations, for example, by means of spectrum leasing or new spectrum sales, the availability of such additional spectrum could reduce the value of Telesat’s spectrum authorizations and, as a result, the value of Telesat’s business.

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Changes in technology could have a material adverse effect on Telesat’s results of operations, business prospects and financial condition.

The implementation of new technologies that can provide increased capacity to end-users at lower cost may reduce demand for Telesat’s services. Many of the new GEO satellites deployed over the last several years and replacement satellites expected to be deployed in the near term will be high throughput satellites (“HTS”), which are able to transmit substantially more data than pre-existing satellites or may include high throughput payloads. These satellites may decrease demand and/or prices for traditional satellite capacity. While Telesat owns the high throughput Canadian payload on ViaSat-1, and has incorporated high throughput payloads on its Telstar 12 VANTAGE satellite, Telstar 18 VANTAGE and Telstar 19 VANTAGE satellites, the introduction of more, and more capable, HTS by other operators into the markets in which Telesat participates could have a material adverse effect on results of operations, business prospects and financial condition.

A number of NGSO satellite projects are in development, production, in the process of being deployed, or in operation which have significant advantages over GEO satellite systems, in particular for latency sensitive applications. These will substantially increase the amount of available capacity in the marketplace, potentially decreasing demand for GEO satellite services. In addition to new satellite technologies, new projects which could compete with traditional satellite services have been announced, including for the provision of telecommunications services using balloons or drones.

Improvements in existing technologies could also adversely impact the demand for satellite services. For example, improvements in signal compression could allow Telesat customers to transmit the same amount of data using a reduced amount of capacity, which could decrease demand for Telesat services.

Interruption or failure of, or cyber-attacks on, Telesat information technology and communication systems, data breaches, data theft, unauthorized access or hacking could materially harm Telesat’s reputation and ability to operate its business effectively, any of which could harm its business and operating results.

Telesat’s success depends, in part, on the secure and uninterrupted performance of Telesat’s information technology and communications systems, which are an integral part of its business. Telesat relies on its information and communications systems, as well as on software applications developed internally and externally, to effectively manage its accounting and financial functions, including maintaining its internal controls, operate its satellites and satellites for third parties, provide consulting services to customers, transmit customer’s proprietary and/or confidential content and assist with other operations, among other things. An increasing number of companies have disclosed breaches of their security, some of which have involved sophisticated and highly targeted attacks on their computer networks. Because the techniques used to obtain unauthorized access, disable or degrade service, or sabotage systems, change frequently and often are not recognized until launched against a target, Telesat may be unable to anticipate these techniques or to implement adequate preventative measures. If unauthorized parties gain access to Telesat’s information technology systems, they may be able to misappropriate assets, including confidential trade secrets and intellectual property assets, which could be used to compete against Telesat’s business and otherwise adversely impact its competitive position. They could also access sensitive information (such as personally identifiable information of Telesat’s customers, business partners and employees), cause interruption in Telesat’s operations, corruption of data or computers, or otherwise damage Telesat’s reputation and business. In such circumstances, Telesat could be held liable to its customers or other parties, or be subject to regulatory or other actions for breaching privacy rules.

While Telesat continues to bolster its systems with additional security measures and, working with external experts, mitigate the risk of security breaches, its systems may be vulnerable to theft, loss, damage and interruption from a number of potential sources and events, including unauthorized access or security breaches, inclement weather, natural or man-made disasters, earthquakes, explosions, terrorist attacks, floods, fires, cyberattacks, computer viruses, malware, ransomware, phishing attacks, social engineering schemes, domain name spoofing, insider theft, power loss, telecommunications or equipment failures, transportation interruptions, accidents or other disruptive events or attempts to harm its systems. Telesat’s facilities are potentially vulnerable to break-ins, sabotage and intentional acts of vandalism. Its disaster recovery planning cannot account for all eventualities.

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Telesat’s business and operations could be adversely affected if, as a result of a significant cyber event or otherwise, its operations are disrupted or shutdown, confidential or proprietary information is stolen or disclosed, it loses customers, it incurs costs or is required to pay fines in connection with confidential or export-controlled information that is disclosed, it must dedicate significant resources to system repairs or increase cyber security protection or it otherwise incurs significant litigation or other costs as a result of any such event. A serious disruption to Telesat’s systems could significantly limit its ability to manage and operate its business efficiently, which in turn could have a material adverse effect on its business, reputation, results of operations and financial condition. Furthermore, any compromise of Telesat’s security could result in a loss of confidence in Telesat’s security measures, and subject Telesat to litigation, civil or criminal penalties, and negative publicity that could adversely affect Telesat’s financial condition and results of operations.

Pandemics could have a material adverse effect on Telesat’s business, financial condition and results of operations.

Telesat’s business and results of operation have been and may in the future be adversely affected by pandemics, and by measures taken to prevent their spread, including restrictions on travel, imposition of quarantines, cancellation of events, remote working, and closure of workplaces and other businesses. Telesat’s business and results of operations may also be negatively impacted by the adverse effect that pandemics have had, and may in the future have, on global economic activity, which may include continued inflation and/or a period of prolonged global or regional economic slowdowns or recessions. Pandemics could also impact Telesat’s ability to attract capital to finance business strategies, such as the development of the Lightspeed constellation and its related network, and also could increase Telesat’s cost of borrowing.

Telesat may pursue acquisitions, dispositions and strategic transactions which could result in the incurrence of additional costs, liabilities or expenses in connection with the implementation of such transactions.

In the future, Telesat may pursue acquisitions, dispositions and strategic transactions, which may include joint ventures and strategic relations, as well as business combinations or the acquisition or disposition of assets. Acquisitions, dispositions and strategic transactions involve a number of risks, including: potential disruption of ongoing business; distraction of management; may result in Telesat being more leveraged; the anticipated benefits and cost savings of those transactions may not be realized fully or at all or may take longer to realize than expected; increasing the scope and complexity of Telesat operations; and loss or reduction of control over certain of its assets.

The presence of one or more material liabilities of an acquired company that are unknown to Telesat at the time of acquisition could have a material adverse effect on its results of operations, business prospects and financial condition. A strategic transaction may result in a significant change in the nature of its business, operations and strategy. In addition, it may encounter unforeseen obstacles or costs in implementing a strategic transaction.

Telesat continues to evaluate the performance of all of its businesses and may sell businesses or assets. Such a sale could include a strategic disposition of one or more of its satellites. In addition to the risks listed above that may occur with any acquisition, disposition or strategic transaction, a satellite divestiture could result in a loss of revenues or significant write-offs, including those related to goodwill and other intangible assets, which could have a material adverse effect on its financial condition, results of operations and cash flows. There can be no assurance that Telesat will be successful in addressing these or any other significant risks encountered.

Telesat could experience the departure of key employees or may be unable to recruit the employees needed for its success.

Telesat relies on a number of key employees, including members of management and certain other employees possessing unique experience in technical and commercial aspects of the satellite services business. If it is unable to retain these employees, it could be difficult to replace them. In addition, Telesat’s business, with its constant technological developments, must continue to attract highly qualified and technically skilled employees. In the future, if Telesat were unable to retain or replace its key employees, or if it were unable to attract new highly qualified employees, it could have a material adverse effect on results of operations, business prospects and financial condition.

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Telesat’s future reported net income and asset values could be adversely affected by impairments of the value of goodwill and intangible assets.

The assets listed on Telesat’s consolidated balance sheet as at December 31, 2023 include goodwill with a carrying value of approximately $2,446.6 million and other intangible assets with a carrying value of approximately $692.8 million. Goodwill and other intangible assets are qualitatively assessed for indicators of impairment. If the qualitative assessment concludes an indication of impairment, a quantitative impairment test of goodwill and other intangible assets (such as orbital locations) with indefinite useful lives is undertaken. Telesat measures for the quantitative impairment test using a projected discounted cash flow method and confirms the assessment using other valuation methods.

If the asset’s carrying value is more than its recoverable amount, the difference is recorded as a reduction in the amount of the asset on the balance sheet and an impairment charge in the statement of income. Quantitative testing for impairment requires significant judgment by management to determine the assumptions used in the impairment analysis. Any changes in the assumptions used could have a material impact on the impairment analysis and result in an impairment charge. Telesat cannot predict whether an event that triggers impairment will occur, when it will occur or how it will affect the reported asset values.

A substantial amount of Telesat’s goodwill and intangible asset value is supported by the planned Telesat Lightspeed constellation. If it were determined that the Telesat Lightspeed constellation program was unlikely to proceed, it is likely that Telesat’s goodwill and intangible assets would be deemed to be impaired.

If Telesat’s goodwill or other intangible assets are deemed to be impaired in whole or in part, it could be required to reduce or write-off such assets, which could have a material adverse effect on its financial condition.

Significant changes in exchange rates could have a material adverse effect on financial results.

Telesat’s main foreign currency exposures as of December 31, 2023 lie in its U.S. dollar denominated debt financing and cash and cash equivalents. In addition, approximately 52% of revenue, 39% of operating expenses, 100% of interest expense on indebtedness and the majority of capital expenditures were denominated in U.S. dollars for the year ended December 31, 2023.

As a result of a decrease in the value of the Canadian dollar against the U.S. dollar at December 31, 2023 compared to December 31, 2022, Telesat recorded a foreign exchange gain of approximately $77.8 million for the year ended December 31, 2023. A five percent increase (decrease) in the value of the U.S. dollar against the Canadian dollar would have increased (decreased) indebtedness and (decreased) increased net income as at December 31, 2023 by $160.0 million. A five percent increase (decrease) in the value of the U.S. dollar against the Canadian dollar would have increased (decreased) cash and cash equivalents by $75.5 million, increased (decreased) net income by $10.6 million and increased (decreased) other comprehensive income by $64.9 million as at December 31, 2023. In addition, for the year ended December 31, 2023, a five percent increase (decrease) in the value of the U.S. dollar against the Canadian dollar would have increased (decreased) revenue by $18.4 million, operating expenses by $4.0 million, and interest expense by $12.7 million. These analyses assume that all other variables remain constant.

A portion of Telesat revenues comes from contracts which are denominated in Brazilian Reais. Any decrease in the value of the Brazilian Reais against the Canadian dollar would reduce revenues.

Significant changes in exchange rates could materially increase interest and other payment obligations under Telesat’s financing arrangements.

As at December 31, 2023, the Canadian dollar equivalent of Telesat’s debt, excluding deferred financing costs, loss on repayment and prepayment options was $3,199.2 million. As at December 31, 2023, if the value of the Canadian dollar against the U.S. dollar increased (decreased) by $0.01, indebtedness would have decreased (increased) by $24.2 million. Changes in exchange rates impact the amount that Telesat pays in interest, and may significantly increase the amount that it is required to pay in Canadian dollar terms to redeem its Senior Secured Notes, 2026 Senior

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Secured Notes or Senior Notes, either at maturity, or earlier if redemption rights are exercised or other events occur which require it to offer to purchase its Senior Secured Notes, 2026 Senior Secured Notes or Senior Notes prior to maturity, and to repay funds drawn under the Senior Secured Credit Facilities.

The soundness of financial institutions and counterparties could adversely affect Telesat.

Telesat has exposure to many different financial institutions and counterparties (including those under its credit, financing and insurance arrangements), including brokers and dealers, commercial banks, investment banks, insurance providers and other institutions and industry participants. Telesat is exposed to risk, including credit risk resulting from many of the transactions it executes in connection with its hedging activities, in the event that any of its lenders or counterparties, including its insurance providers, are unable to honor their commitments or otherwise default under an agreement with it.

Because of the Telesat Canada Reorganization and Divestiture Act, a Canadian act uniquely applicable to Telesat Canada (but not the other entities in the Telesat corporate structure), Telesat’s primary operating subsidiary may not have access to the usual protections from creditors and other rights available to insolvent persons and creditors, may not have recourse to the usual rights, remedies and protections under applicable bankruptcy and insolvency laws generally available to creditors of insolvent persons.

Under the Telesat Canada Reorganization and Divestiture Act (“Telesat Divestiture Act”), Telesat Canada (as a corporate entity) is subject to certain special conditions and restrictions. The Telesat Divestiture Act provides that no legislation relating to the solvency or winding-up of a corporation applies to Telesat Canada and in no case shall Telesat Canada’s affairs be wound up unless authorized by an Act of the Parliament of Canada. As a result of such legislative provisions, Telesat Canada and its creditors may not have recourse to the usual rights, remedies and protections under applicable bankruptcy and insolvency laws, including the imposition of a stay of proceedings, or a regulated and orderly process to settle or compromise claims and make distributions to creditors, or recourse to fraudulent preference, transfer at undervalue or fraudulent conveyance laws. The effect of the Telesat Divestiture Act upon Telesat Canada’s insolvency has not been considered by a Canadian court and, accordingly, the application of Canadian federal bankruptcy and insolvency laws and provincial receivership and fraudulent conveyance and assignment and preference laws, and the exercise by a Canadian court of any judicial discretion which could affect the enforcement of rights and remedies or other equitable relief against Telesat Canada in the context of an insolvency, is uncertain. To the extent bankruptcy and insolvency laws do not apply to Telesat Canada, its creditors may individually seek to pursue any available rights or remedies, as secured or unsecured creditors as the case may be, against Telesat Canada and its assets. Only Telesat Canada’s assets (including the shares in its subsidiaries) are subject to the Telesat Divestiture Act, but the assets of the other entities within the Telesat corporate structure, including the guarantors of Telesat Canada’s credit facility and outstanding notes, are not. These restrictions may have a material impact on the sale of Telesat Canada or its assets in any bankruptcy or reorganization scenario and on any proceeding to realize value from Telesat Canada or its assets.

Risks Relating to Telesat’s Lightspeed Constellation

There are numerous technological risks and uncertainties associated with Telesat’s planned Lightspeed constellation which may cause it to be unsuccessful and have a material adverse effect on Telesat’s results of operations, business prospects and financial condition.

Telesat is currently developing an advanced LEO satellite network consisting of over one hundred and up to several hundred satellites in NGSO. There are numerous risks and uncertainties associated with NGSO constellations generally and with Telesat’s Lightspeed constellation.

NGSO constellations are complex. In order to operate successfully and deliver a high-quality service, all components of the system, both on the ground and in space, must be integrated seamlessly and efficiently.

Unlike most traditional GEO satellites currently in use, which rely on legacy, space-tested hardware and established ground equipment infrastructures, some of the technology necessary for the successful operation of a LEO constellation, in particular Telesat’s Lightspeed constellation, is still in development. Telesat’s Lightspeed constellation design incorporates leading-edge satellite technologies, including on-board data processing, multi-beam phased array antennas and optical inter-satellite links; these are technologies that have not been fully developed for space applications

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at the scale, levels of performance and price points that are required for the successful operation and commercialization of Telesat’s Lightspeed constellation. In addition, certain key suppliers are small, new companies that may not be well capitalized and for whom we are their largest customer. If these key suppliers’ businesses were to fail, the Lightspeed constellation could be materially delayed and/or its cost could materially increase. In order to provide a competitive service in certain of the customer segments Telesat plans to serve, it requires advances in ground terminal design and manufacturing, particularly electronic flat panel antennas capable of acquiring and tracking LEO satellites. If Telesat’s Lightspeed constellation does not deliver the required quality of service at prices that are competitive relative to other satellite providers and alternative products, it may not be able to acquire customers and establish a successful business. It is possible that Telesat may not be able to overcome the technological hurdles required to complete the planned Lightspeed constellation, the start of service may be materially delayed, and/or due to technological issues the Lightspeed constellation may not operate as planned, any of which could have a material adverse effect on results of operations, business prospects and financial condition.

Telesat’s planned Lightspeed constellation may suffer launch failures or its satellites may fail to reach their planned orbital locations. Any such issue could result in the loss of a satellite or cause significant delays in the deployment of the satellite. Delays in launching satellites and in the deployment of satellites are not uncommon and result from construction delays, the unavailability of reliable launch opportunities with suppliers, delays in obtaining required regulatory approvals, launch failures and launch vehicle underperformance (in which case the satellite may be lost or, if it can be placed into service by using its onboard propulsion systems to reach the desired orbit, will have a shorter useful life).

Launch failures may result in delays in the deployment of satellite constellations because of the need to construct replacement satellites. A delay or perceived delay in launching the planned Lightspeed constellation may cause Telesat’s customers to move to another satellite provider. As of the date of this annual report, Telesat has not received any prepayments from customers of its Telesat Lightspeed constellation that would need to be refunded in the event of significant delays in launching such satellites (nor would there be other contractual penalties or damages to such customers for such delays). It is possible that future agreements may include prepayments for services which would need to be repaid, or provide for other contractual penalties or damages, if the Telesat Lightspeed constellation is delayed. Any launch failure, underperformance, delay or perceived delay could have a material adverse effect on results of operations, business prospects and financial condition.

Telesat may be unable to raise sufficient capital to fund the Lightspeed constellation and Telesat may ultimately be unable to, or choose to not, proceed with the project.

The implementation of Telesat’s planned Lightspeed constellation will require a substantial outlay of capital, and Telesat may not be able to raise sufficient capital to successfully develop and commercialize the project. See “— Telesat’s business is capital intensive and it may not be able to raise adequate capital to finance its business strategies, or it may be able to do so only on terms that significantly restrict its ability to operate its business.” While Telesat has entered into an agreement with MacDonald Dettwiler and Associates (“MDA”) to be the prime manufacturer for the Lightspeed constellation, we do not currently have in place definitive agreements with our financing sources that would allow us to complete construction of the constellation.

While Telesat has announced that it expects to receive funding from Canadian federal and provincial governments in the combined amount of up to approximately US$2 billion, these investments are subject to a number of conditions including the entering into of further, definitive agreements, which, for various reasons, may not occur. If unable to raise sufficient capital, Telesat will not be able to build and deploy its Lightspeed constellation which could have a material adverse effect on Telesat’s operations, business prospects and financial condition.

Telesat and its Canadian federal and provincial government Partners may be unable to agree on definitive documentation related to the Canadian federal and provincial funding commitments, and even if definitive documentation is executed, there is no guarantee that the investment will be advantageous for Telesat or its subsidiaries and the exercise of any warrants granted in connection therewith would be dilutive.

On August 11, 2023, Telesat announced that it expects to receive an up to approximately US$2 billion investment from Canadian federal and provincial governments to support Telesat Lightspeed. See “Business — Our GEO Business and Our LEO Opportunity — Overview of Telesat Lightspeed”. A binding obligation with respect

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to these investments will only be created upon execution of definitive documentation that will contain the terms including representations, warranties, covenants, indemnities, defaults, and other terms and conditions (including fees and expenses, increased costs, tax (including customary gross-up and indemnity provisions for any non-resident withholding tax) and other provisions) as these lenders may reasonably require, which are usual and customary for transactions of this nature. Moreover, these investments are in all respects subject to, among other things, ongoing due diligence, negotiation of satisfactory binding legal documentation and required governmental approvals. Consequently, due to the foregoing and other factors, some of which are outside Telesat’s control, the parties may be unable to reach an agreement with respect to definitive documentation. Furthermore, we expect that there will be conditions to the funding of these investments, and the satisfaction of those conditions may not be entirely within Telesat’s control. The definitive documentation with respect to these investments is expected to contain various affirmative and negative covenants, some of which may restrict Telesat’s ability to conduct its business and which Telesat Canada and Telesat may find onerous. While Telesat will attempt to negotiate definitive documentation for these investments, there is no guarantee it will be successful in doing so.

In connection with the investments from the Canadian federal and provincial governments to support Telesat Lightspeed, Telesat expects to, among other things, grant warrants to purchase a number of shares of the unrestricted subsidiary that will develop and commercialize the Lightspeed constellation. Any exercise of such warrants would result in dilution of the interest of the shareholders of Telesat in the Telesat Lightspeed business.

Telesat’s planned Lightspeed constellation will require Telesat to develop significant commercial and service operational capabilities. Failure to effectively develop such operational capabilities could cause Telesat’s Lightspeed constellation to fail to achieve commercial viability and could have a material adverse effect on Telesat’s operations, business prospects and financial condition.

Telesat’s planned Lightspeed constellation will offer an end-to-end data service such that Telesat will be responsible for system performance from the Point of Presence (where the constellation connects to either a customer’s private network or to the terrestrial internet) through the Lightspeed network to the end-user’s terminal. This contrasts with Telesat’s current GEO satellite services, from which Telesat currently derives a majority of its revenue, where Telesat primarily provides customers with access to its GEO satellites, and customers then combine this capacity with ground (hub) equipment to create a connectivity service. Telesat’s failure to develop new supporting technologies, processes and procedures, competencies, and other capabilities to support the Lightspeed constellation may materially impact its ability to commercialize the Lightspeed constellation. Additionally, Telesat’s Lightspeed constellation will require an advanced ecosystem to support LEO service installation and provisioning, including user terminals and related installs, which we currently do not possess at the scale that will be required.

Telesat’s effective monetization of its Lightspeed constellation may require Telesat to provide ancillary services to combine with Telesat’s LEO services, as customers may demand these services to create a complete solution for their communications requirements. Some examples of ancillary services are trained third parties who can install and maintain Telesat’s LEO terminals. Telesat does not currently have these capabilities, and may be required either to develop such capabilities in house or partner with third parties to deliver these capabilities, and Telesat cannot assure you that it will be able to successfully establish such capabilities. A material part of Telesat’s anticipated revenues from its planned Lightspeed constellation will come from geographies where Telesat does not have a significant presence today, including Europe, Africa and Asia, and the expansion of Telesat’s capabilities in other geographies where it currently has operations. Telesat’s failure to expand its sales and distribution capabilities in these geographies could cause the Lightspeed constellation to fail to achieve commercial viability.

In order to effectively operate its planned Lightspeed constellation, Telesat will be required to develop and expand certain business operations capabilities, including management of inventory, tracking service installation and commissioning, network monitoring and customer call resolution. Telesat will also need to develop new network capabilities to provision terminals, manage bandwidth and monitor these services. If Telesat is unable to develop these capabilities, it may be unable to provide customers with a level of service sufficient to support the Lightspeed constellation’s adoption.

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Even if Telesat is able to successfully build and deploy the Lightspeed constellation, Telesat may nonetheless fail to generate anticipated revenues due to slow market adoption or because the total addressable market for the Lightspeed constellation may be smaller than Telesat expects.

Telesat’s projected revenues from its Lightspeed constellation are based on the anticipated expansion of the market for satellite services, which assumes that the availability of higher quality, lower priced services will lead to increased uses of satellite services. However, there may be factors, both internal to and extraneous to Telesat’s development and deployment of its LEO satellites, that slow market adoption of LEO constellations and cause Telesat’s LEO revenues to be lower than anticipated. LEO ground terminal antennas require a much greater field of view than GEO antennas because LEO satellites are in constant motion from the perspective of the earth. This may mean that LEO antennas are more difficult to install than anticipated, which could limit the adoption of LEO technology. If we are unable to deploy a sufficient number of satellites needed to communicate with standard flat panel antennas, which require an even greater field of view than traditional ground terminal antennas, it may increase the costs of the antennas required to communicate with our satellites, which could increase our costs or adversely impact the addressable market for our services. We will operate our Lightspeed constellation using Ka-band frequencies while some of our competitors are using, or intend to use, Ku-band frequencies which are less susceptible to service outages because of heavy rains. An increased level and frequency of outages at Ka-band may negatively impact the size of the market for our Lightspeed services. Additionally, given that Telesat Lightspeed relies on new technology, potential customers may not be willing to purchase its services until Telesat Lightspeed has been successfully deployed and in operation which could delay or decrease demand for its services. If sufficient LEO terminals are not installed prior to the commencement of global service, it could lead to a failure to achieve anticipated revenues on a timeline that supports Telesat’s Lightspeed constellation’s commercial viability. Moreover, certain users, particularly governments, may have requirements, including security requirements that Telesat is unable to meet, leading to lack of access to important markets.

Telesat’s business plan for the Lightspeed constellation is based on its own analysis of the total addressable market (“TAM”) for the constellation’s services. It is possible that Telesat’s analysis of the TAM for the Lightspeed constellation is inaccurate and the TAM could be materially smaller than Telesat’s analysis suggests. Even if Telesat’s analysis of the TAM for Telesat Lightspeed is accurate, those services may end up being provided by Telesat’s competitors, some of whom are larger, have greater access to capital and have deployed or will deploy their constellations before Telesat.

Although Telesat believes there is a significant market for the services it expects to provide with its Lightspeed constellation, it may not be able to attract enough customers to make the project successful and earn a sufficient return on investment or support its indebtedness, which could have a material adverse effect on its business prospects and financial condition.

Telesat faces robust competition to build and effectively deploy its Lightspeed constellation, and/or the pursuit of a LEO constellation may negatively impact Telesat’s existing business.

Telesat’s Lightspeed constellation will also compete with NGSO satellite projects announced and/or in operation by other companies, including Eutelsat (OneWeb), SpaceX, SES/O3b, Amazon’s subsidiary Kuiper (referenced herein as Amazon), Rivada Space Networks, as well as country and region-sponsored projects in China, Russia and the European Union. Some of these potential competitors to Telesat’s system have greater access to capital than Telesat has and/or are at a more advanced stage of development. For example, China and Russia have access to larger amounts of capital and have government-owned satellite manufacturing and launch facilities at their disposal. SpaceX and Amazon are much larger than Telesat, have more diverse sources of revenue and have substantially greater financial resources than Telesat.

The Eutelsat (OneWeb) and SpaceX constellations have already commenced operations, which may make it more difficult for Telesat to attract customers for its constellation once it is deployed. Further, to the extent any of the other constellations make use of Ka-band spectrum, as SpaceX and Eutelsat (OneWeb) do, and as Amazon has indicated it will, it may limit Telesat’s access to sufficient Ka-band spectrum to operate the Lightspeed constellation efficiently and profitably. See “Risks Relating to Regulatory Matters.” Telesat also competes with Eutelsat (OneWeb), SpaceX, Amazon and other developers of NGSO satellite projects for human capital, and Telesat may fail to recruit and retain a workforce capable of developing and deploying its planned Lightspeed constellation, which may cause Telesat to fail to successfully commercialize its Lightspeed constellation.

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Some of Telesat’s competitors have greater access to launch capabilities than Telesat. SpaceX has its own in-house launch capability and Blue Origin, a company owned by Amazon’s Executive Chair and largest shareholder, Jeff Bezos, is significantly advanced in its development of launch vehicles. Each of Amazon’s and SpaceX’s greater access to launch vehicles for its own satellites may give it an advantage over Telesat since Telesat does not have in-house capability to launch its own satellites. In addition, SpaceX manufactures, and Amazon intends to manufacture, their own satellites, which may provide them with advantages over us since we are reliant on third parties for the supply of our Lightspeed satellites.

If successfully implemented, the Lightspeed constellation may decrease demand for Telesat’s other satellite services. See “— Changes in technology could have a material adverse effect on Telesat’s results of operations, business prospects and financial condition.”

Risks Relating to Intellectual Property

If we are unable to obtain, maintain, protect and enforce patent and other intellectual property protection for our technology and services, or if the scope of the patent and other intellectual property protection obtained is not sufficiently broad, we may not be able to compete effectively in our markets.

Our success may depend, in part, on our ability to obtain, maintain, protect and enforce patent and other intellectual property protection in the United States and other countries with respect to our services and technology we develop. If we fail to obtain, maintain, protect and enforce our intellectual property, third parties may be able to compete more effectively against us, we may lose our technological or competitive advantage, or we may incur substantial litigation costs in our attempts to recover or restrict use of our intellectual property.

We seek to protect our position by filing patent applications in the United States and elsewhere related to our technologies and services that are important to our business. We also rely on a combination of contractual provisions, confidentiality procedures and copyright, trademark, trade secret and other intellectual property rights to protect the proprietary aspects of our brands, services, technologies and data. These legal measures afford only limited protection, and competitors or others may gain access to or use our intellectual property and proprietary information. Our success will depend, in part, on obtaining and maintaining patents, copyrights, trademarks, trade secrets, data and know-how and other intellectual property rights.

We may not be able to obtain and maintain intellectual property or other proprietary rights necessary to our business or in a form that provides us with a competitive advantage. For example, our trade secrets, data and know-how could be subject to unauthorized use, misappropriation or disclosure to unauthorized parties, despite our efforts to enter into confidentiality agreements with our employees, consultants, contractors, clients and other vendors who have access to such information, and could otherwise become known or be independently discovered by third parties. In addition, the patent prosecution process is expensive, time-consuming and complex, and we may not be able to file, prosecute, maintain, enforce or license all necessary or desirable patent applications at a reasonable cost, in a timely manner, or in all jurisdictions where protection may be commercially advantageous, or we may not be able to protect our intellectual property at all. Despite our efforts to protect our intellectual property, unauthorized parties may be able to obtain and use information that we regard as proprietary.

Given that patent applications are confidential for a period of time after filing, we cannot be certain that we were the first to file any patent application related to our services. The issuance of a patent is not conclusive as to its inventorship, scope, validity or enforceability and our owned and in-licensed issued patents may be challenged in courts or patent offices in the United States and abroad. For example, we may be subject to a third-party submission of prior art to the United States Patent and Trademark Office (“USPTO”) challenging the validity of one or more claims of our owned or in-licensed issued patents. Competitors may also contest our patents, if issued, by showing the USPTO, or the applicable other foreign patent agency that the invention was not original, was not novel or was obvious. In litigation, a competitor could claim that our patents, if issued, are not valid for a number of reasons. If a court agrees, we would lose our rights to those challenged patents.

It is also possible that we will fail to identify patentable aspects of our research and development output in time to obtain patent protection. Although we enter into non-disclosure and confidentiality agreements with parties who have access to confidential or patentable aspects of our research and development output, such as our employees, consultants, contractors, collaborators, vendors and other third parties, any of these parties may breach the agreements and disclose such output before a patent application is filed, thereby jeopardizing our ability to seek patent protection.

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We may not be able to obtain or maintain patent applications and issued patents due to the subject matter claimed in such patent applications and issued patents being in disclosures in the public domain, and we may not be able to prevent any third party from using any of our technology that is in the public domain to compete with our technologies. In addition, publications of discoveries in the scientific literature often lag behind the actual discoveries, and patent applications in the United States and other jurisdictions are typically not published until 18 months after filing, or in some cases not at all. Therefore, we cannot be certain that we were the first to make the inventions claimed in our owned or in-licensed issued patents or pending patent applications, or that we were the first to file for patent protection of such inventions. If a third party can establish that we or our licensors were not the first to make or the first to file for patent protection of such inventions, our owned or in-licensed patent applications may not issue as patents and even if issued, may be challenged and invalidated or rendered unenforceable.

Moreover, the coverage claimed in a patent application can be significantly reduced before a patent is issued, and its scope can be reinterpreted after issuance. Even if patent applications we license or own currently or in the future issue as patents, they may not issue in a form that will provide us with any meaningful protection, prevent competitors or other third parties from competing with us, or otherwise provide us with any competitive advantage. Any patents that we hold may be challenged, narrowed or invalidated by third parties. Additionally, our competitors or other third parties may be able to circumvent our patents by developing similar or alternative technologies or services in a non-infringing manner. Third parties may also have blocking patents that could prevent us from marketing our own services and practicing our own technology. Alternatively, third parties may seek approval to market their own products or services similar to or otherwise competitive with our services. In these circumstances, we may need to defend and/or assert our patents, including by filing lawsuits alleging patent infringement. In any of these types of proceedings, a court or agency with jurisdiction may find our patents invalid, unenforceable or not infringed, in which case, our competitors and other third parties may then be able to market services and use manufacturing and analytical processes that are substantially similar to ours. Even if we have valid and enforceable patents, these patents still may not provide protection against competing services or processes sufficient to achieve our business objectives.

Failure to obtain and maintain patents, trademarks and other intellectual property rights necessary to our business and failure to protect, monitor and control the use of our intellectual property rights could negatively impact our ability to compete and cause us to incur significant expenses. The intellectual property laws and other statutory and contractual arrangements in the United States and other jurisdictions we depend upon may not provide sufficient protection in the future to prevent the infringement, use, violation or misappropriation of our patents, trademarks, data, technology and other intellectual property, and may not provide an adequate remedy if our intellectual property rights are infringed, misappropriated or otherwise violated. Any of the foregoing could have a material adverse effect on our competitive position, business, financial conditions, results of operations and prospects.

We may not identify relevant third-party patents or may incorrectly interpret the relevance, scope or expiration of a third-party patent, which might adversely affect our ability to develop and market our services.

We cannot guarantee that any of our patent searches or analyses, including the identification of relevant patents, the scope of patent claims or the expiration of relevant patents, are complete or thorough, nor can we be certain that we have identified each and every third-party patent and pending application in the United States and abroad that is relevant to or necessary for the commercialization of our current and future services in any jurisdiction.

The scope of a patent claim is determined by an interpretation of the law, the written disclosure in a patent and the patent’s prosecution history. Our interpretation of the relevance or the scope of a patent or a pending application may be incorrect, which may negatively impact our ability to market our services. We may incorrectly determine that our services are not covered by a third-party patent or may incorrectly predict whether a third party’s pending application will issue with claims of relevant scope. Our determination of the expiration date of any patent in the United States or abroad that we consider relevant may be incorrect, and our failure to identify and correctly interpret relevant patents may negatively impact our ability to develop and market our services.

We may be subject to claims that we or our employees have misappropriated the intellectual property of a third party, including trade secrets or know-how, or are in breach of non-competition or non-solicitation agreements with our competitors and third parties may claim an ownership interest in intellectual property we regard as our own.

Many of our employees and consultants were previously employed at or engaged by our competitors or potential competitors. Some of these employees, consultants and contractors, may have executed proprietary rights, non-disclosure and non-competition agreements in connection with such previous employment. Although we try to

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ensure that our employees and consultants do not use the intellectual property, proprietary information, know-how or trade secrets of others in their work for us, we may be subject to claims that we or these individuals have, inadvertently or otherwise, misappropriated the intellectual property or disclosed the alleged trade secrets or other proprietary information, of these former employers or competitors. Litigation may be necessary to defend against these claims, and if we fail in defending any such claims, in addition to paying monetary damages, we may lose valuable intellectual property rights. In addition, we may lose personnel as a result of such claims. Any such litigation, or the threat thereof, may adversely affect our ability to hire employees or contract with independent contractors. A loss of key personnel or their work product could hamper or prevent our ability to commercialize our services, which would have a material adverse effect on our business, results of operations, financial condition and prospects.

Additionally, we may be subject to claims from third parties challenging our ownership interest in intellectual property we regard as our own, based on claims that our employees or consultants have breached an obligation to assign inventions to another employer, to a former employer, or to another person or entity. Litigation may be necessary to defend against any other claims, and it may be necessary or we may desire to enter into a license to settle any such claim; however, there can be no assurance that we would be able to obtain a license on commercially reasonable terms, if at all. If our defense to those claims fails, in addition to paying monetary damages, a court could prohibit us from using technologies or features that are essential to our services, if such technologies or features are found to incorporate or be derived from the trade secrets or other proprietary information of the former employers.

We may in the future also be subject to claims by our former employees, consultants or contractors asserting an ownership right in our patents or patent applications, as a result of the work they performed on our behalf. Although we generally require all of our employees, consultants, contractors and any other partners or collaborators who have access to our proprietary know-how, information or technology to assign or grant similar rights to their inventions to us, we cannot be certain that we have executed such agreements with all parties who may have contributed to our intellectual property, nor can we be certain that our agreements with such parties will be upheld in the face of a potential challenge, or that they will not be breached, for which we may not have an adequate remedy.

We may become a party to intellectual property litigation or administrative proceedings that could be costly and could interfere with our ability to sell and market our services.

It is possible that U.S. and foreign patents and pending patent applications, copyrights, or trademarks controlled by third parties may be alleged to cover our services, or that we may be accused of misappropriating third parties’ trade secrets. Additionally, our services make use of components that we purchase from vendors, and may include design components that are outside of our direct control. Our competitors, some of which have substantially greater resources and have made substantial investments in patent portfolios, trade secrets, copyrights, trademarks and competing technologies, may have applied for or obtained, or may in the future apply for or obtain, patents, copyrights, or trademarks that will prevent, limit or otherwise interfere with our ability to make, use, sell and/or export our services or to use product names. Because patent applications can take years to issue and are often afforded confidentiality for some period of time, there may currently be pending applications, unknown to us, that later result in issued patents that could cover one or more of our technology and services. Moreover, in recent years, individuals and groups that are non-practicing entities, commonly referred to as “patent trolls,” have purchased patents and other intellectual property assets for the purpose of making claims of infringement in order to extract settlements. From time to time, we may receive threatening letters, notices or “invitations to license,” or may be the subject of claims that our products and business operations infringe or violate the intellectual property rights of others. We may face patent infringement claims from non-practicing entities that have no relevant product or service revenue and against whom our owned or in-licensed patent portfolio may therefore have no deterrent effect. We may in the future become party to adversarial proceedings or litigation where our competitors or other third parties may assert claims against us, alleging that our technology or services infringe, misappropriate or otherwise violate their intellectual property rights, including patents and trade secrets. The defense of these matters can be time consuming, costly to defend in litigation, divert management’s attention and resources, damage our reputation and brand and cause us to incur significant expenses or make substantial payments. Vendors from whom we purchase hardware or software may not indemnify us in the event that such hardware or software is accused of infringing a third party’s patent or trademark or of misappropriating a third party’s trade secret, or any indemnification granted by such vendors may not be sufficient to address any liability and costs we incur as a result of such claims.

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Even if we believe third party’s intellectual property claims are without merit, there is no assurance that a court would find in our favor, including on questions of infringement, validity, enforceability or priority of patents. The strength of our defenses will depend on the patents asserted, the interpretation of these patents, and our ability to invalidate the asserted patents. A court of competent jurisdiction could hold that these third-party patents are valid, enforceable and infringed, which could materially and adversely affect our ability to commercialize any services or technology we may develop, and any other services or technologies covered by the asserted third-party patents. In order to successfully challenge the validity of any such U.S. patent in federal court, we would need to overcome a presumption of validity. As this burden is a high one requiring us to present clear and convincing evidence as to the invalidity of any such U.S. patent claim, there is no assurance that a court of competent jurisdiction would invalidate the claims of any such U.S. patent. Conversely, the patent owner need only prove infringement by a preponderance of the evidence, which is a lower burden of proof.

Further, if patents, trademarks, copyrights, or trade secrets are successfully asserted against us, this may harm our business and result in injunctions preventing us from developing, manufacturing, marketing or selling our services, or result in obligations to pay license fees, damages, attorney fees and court costs, which could be significant. In addition, if we are found to willfully infringe third-party patents or trademarks or to have misappropriated trade secrets, we could be required to pay treble damages in addition to other penalties.

Although patent, copyright, trademark, trade secret and other intellectual property disputes in our industry have often been settled through licensing or similar arrangements, costs associated with such arrangements may be substantial and could include ongoing royalties. We may be unable to obtain necessary licenses on satisfactory terms, if at all. In addition, if any license we obtain is non-exclusive, we may not be able to prevent our competitors and other third parties from using the intellectual property or technology covered by such license to compete with us. If we do not obtain necessary licenses, we may not be able to redesign our services to avoid infringement. Any of these events could materially and adversely affect our business, financial condition and results of operations.

Similarly, interference or derivation proceedings provoked by third parties or brought by the USPTO may be necessary to determine priority with respect to our patents, patent applications, trademarks or trademark applications. We may also become involved in other proceedings, such as reexamination, inter partes review, derivation or opposition proceedings before the USPTO or other jurisdictional body relating to our intellectual property rights or the intellectual property rights of others. Adverse determinations in a judicial or administrative proceeding or failure to obtain necessary licenses could prevent us from delivering our services or using product names, which would have a significant adverse impact on our business, financial condition and results of operations.

Additionally, we may file lawsuits or initiate other proceedings to protect or enforce our patents or other intellectual property rights, which could be expensive, time consuming and unsuccessful. Competitors may infringe our issued patents or other intellectual property, which we may not always be able to detect.

To counter infringement or unauthorized use, we may be required to file infringement claims, which can be expensive and time-consuming. Any claims we assert against perceived infringers could provoke these parties to assert counterclaims against us alleging that we infringe their intellectual property or alleging that our intellectual property is invalid or unenforceable. Grounds for a validity challenge could be an alleged failure to meet any of several statutory requirements, including lack of novelty, obviousness or non-enablement. Grounds for an unenforceability assertion could be an allegation that someone connected with prosecution of the patent withheld relevant information from the USPTO, or made a misleading statement, during prosecution. Third parties may raise challenges to the validity of certain of our owned or in-licensed patent claims before administrative bodies in the United States or abroad, even outside the context of litigation. Such mechanisms include re-examination, post-grant review, inter partes review, interference proceedings, derivation proceedings and equivalent proceedings in foreign jurisdictions (e.g., opposition proceedings). In any such lawsuit or other proceedings, a court or other administrative body may decide that a patent of ours is invalid or unenforceable, in whole or in part, construe the patent’s claims narrowly or refuse to stop the other party from using the technology at issue on the grounds that our patents do not cover the technology in question.

The outcome following legal assertions of invalidity and unenforceability is unpredictable. If a third party were to prevail on a legal assertion of invalidity or unenforceability, we would lose at least part, and perhaps all, of the patent protection on our services or services that we may develop. If our patents are found to be valid and infringed, a court may refuse to grant injunctive relief against the infringer and instead grant us monetary damages and/or ongoing royalties. Such monetary compensation may be insufficient to adequately offset the damage to our business caused by

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the infringer’s competition in the market. An adverse result in any litigation or other proceeding could put one or more of our patents at risk of being invalidated or interpreted narrowly. Any of these events could materially and adversely affect our business, financial condition and results of operations.

Even if resolved in our favor, litigation or other proceedings relating to intellectual property claims may cause us to incur significant expenses and could distract our personnel from their normal responsibilities. In addition, there could be public announcements of the results of hearings, motions or other interim proceedings or developments, and if securities analysts or investors perceive these results to be negative, it could have a substantial adverse effect on the price of our common stock. Such litigation or proceedings could substantially increase our operating losses and reduce the resources available for development activities or any future sales, marketing or distribution activities. We may not have sufficient financial or other resources to conduct such litigation or proceedings adequately. Some of our competitors may be able to sustain the costs of such litigation or proceedings more effectively than we can because of their greater financial resources and more mature and developed intellectual property portfolios. Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of our confidential or sensitive information could be compromised by disclosure in the event of litigation. Uncertainties resulting from the initiation and continuation of patent and other intellectual property litigation or other proceedings could have a material adverse effect on our business, financial condition and results of operations.

Because of the expense and uncertainty of litigation, we may not be in a position to enforce our intellectual property rights against third parties.

Because of the expense and uncertainty of litigation, we may conclude that even if a third party is infringing, misappropriating or otherwise violating our owned or in-licensed patents, any patents that may be issued as a result of our future patent applications, or other intellectual property rights, the risk-adjusted cost of bringing and enforcing such a claim or action may be too high or not in the best interest of our company or our shareholders. In such cases, we may decide that the more prudent course of action is to simply monitor the situation or initiate or seek some other non-litigious action or solution.

If we are unable to protect the confidentiality of our trade secrets and other proprietary information, our business and competitive position may be harmed.

In addition to patent protection, we also rely on other proprietary rights, including protection of trade secrets, and other proprietary information that is not patentable or that we elect not to patent. However, trade secrets can be difficult to protect and some courts inside and outside the United States are less willing or unwilling to protect trade secrets. To maintain the confidentiality of our trade secrets and proprietary information, we rely heavily on confidentiality provisions that we have in contracts with our employees, consultants, collaborators and others upon the commencement of their relationship with us. We cannot guarantee that we have entered into such agreements with each party that may have or have had access to our trade secrets or proprietary technology and processes. We may not be able to prevent the unauthorized disclosure or use of our technical knowledge or other trade secrets by such third parties, despite the existence generally of these confidentiality restrictions. These contracts may not provide meaningful protection for our trade secrets, know-how, or other proprietary information in the event of any unauthorized use, misappropriation, or disclosure of such trade secrets, know-how, or other proprietary information. There can be no assurance that such third parties will not breach their agreements with us, that we will have adequate remedies for any breach, or that our trade secrets will not otherwise become known or independently developed by competitors. Despite the protections we do place on our intellectual property or other proprietary rights, monitoring unauthorized use and disclosure of our intellectual property is difficult, and we do not know whether the steps we have taken to protect our intellectual property or other proprietary rights will be adequate. In addition, the laws of many foreign countries will not protect our intellectual property or other proprietary rights to the same extent as the laws of the United States. Consequently, we may be unable to prevent our proprietary technology from being exploited abroad, which could affect our ability to expand to international markets or require costly efforts to protect our technology.

To the extent our intellectual property or other proprietary information protection is incomplete, we are exposed to a greater risk of direct competition. A third party could, without authorization, copy or otherwise obtain and use our services or technology, or develop similar technology. Our competitors could purchase our services and attempt

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to replicate some or all of the competitive advantages we derive from our development efforts or design around our protected technology. Our failure to secure, protect and enforce our intellectual property rights could substantially harm the value of our services, brand and business. The theft or unauthorized use or publication of our trade secrets and other confidential business information could reduce the differentiation of our services and harm our business, the value of our investment in development or business acquisitions could be reduced and third parties might make claims against us related to losses of their confidential or proprietary information. Any of the foregoing could materially and adversely affect our business, financial condition and results of operations.

Further, it is possible that others will independently develop the same or similar technology or otherwise obtain access to our unpatented technology, and in such cases we could not assert any trade secret rights against such parties or those to whom they communicate such trade secrets. Costly and time-consuming litigation could be necessary to enforce and determine the scope of our trade secret rights and related confidentiality and nondisclosure provisions. If we fail to obtain or maintain trade secret protection, or if our competitors obtain our trade secrets or independently develop technology similar to ours or competing technologies, our competitive market position could be materially and adversely affected. In addition, some courts are less willing or unwilling to protect trade secrets and agreement terms that address non-competition are difficult to enforce in many jurisdictions and might not be enforceable in certain cases.

We also seek to preserve the integrity and confidentiality of our data and other confidential information by maintaining physical security of our premises and physical and electronic security of our information technology systems. While we have confidence in these individuals, organizations and systems, agreements or security measures may be breached and detecting the disclosure or misappropriation of confidential information and enforcing a claim that a party illegally disclosed or misappropriated confidential information is difficult, expensive and time-consuming, and the outcome is unpredictable. Further, we may not be able to obtain adequate remedies for any breach.

Intellectual property rights do not necessarily address all potential threats to our competitive advantage.

The degree of future protection afforded by our intellectual property rights is uncertain because intellectual property rights have limitations, and may not adequately protect our business, or permit us to maintain our competitive advantage. The following examples are illustrative:

• others may be able to make a product that is similar to our current services and future services we intend to commercialize and that is not covered by the patents that we own or exclusively in-license and have the right to enforce;

• we and any of our current or future licensors or collaborators might not have been the first to make the inventions covered by the issued patents or pending patent applications that we own, license or may own or license in the future;

• we or any of our current or future licensors or collaborators might not have been the first to file patent applications covering certain of our inventions;

• others may independently develop similar or alternative technologies or duplicate any of our technologies without infringing, misappropriating or otherwise violating our intellectual property rights;

• it is possible that our current or future owned or in-licensed patent applications will not lead to issued patents;

• issued patents that we own or in-license may not provide us with any competitive advantages, or may be held invalid or unenforceable as a result of legal challenges, including as a result of legal challenges by our competitors;

• we may not develop additional proprietary technologies that are patentable; and

• we may choose not to file a patent for certain trade secrets or know-how, and a third party may subsequently file a patent covering such intellectual property.

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Risks Relating to Regulatory Matters

Telesat operates in a highly regulated industry and is required to comply with multiple, potentially conflicting, laws and regulations and obtain numerous governmental authorizations and approvals. If Telesat becomes subject to onerous regulations, or if it fails to obtain or maintain particular authorizations on acceptable terms (including obtaining required modifications of Canadian and US authorizations and meeting their deployment milestones), such regulatory obligations and/or such failure could delay or prevent it from offering some or all of its services and adversely affect its results of operations, business prospects and financial condition.

Authorizations required to operate satellites

Telesat operates satellites with ITU frequency rights authorized by Canada, the U.S., Brazil, the U.K. and Tonga. Canada, the U.S. and Brazil also issue associated licenses or grants with conditions as discussed below. In addition, Telesat has been granted authorization (sometimes referred to as “market access”) to provide services in many countries around the world, while in other countries there is no formal authorization requirement (sometimes referred to as “Open Skies”). Therefore, Telesat is subject to regulation by government authorities in Canada, the U.S. and Brazil, as well as by other governmental authorities in certain other countries in which it operates.

In Canada, operations are subject to regulation and licensing by Innovation, Science and Economic Development Canada (“ISED”) pursuant to the Radiocommunication Act (Canada), and by the Canadian Radio-television and Telecommunications Commission (“CRTC”) under the Telecommunications Act (Canada). Certain of Telesat’s satellites are licensed by Canada. This includes the GEO Anik satellites F1, F1R, F2, F3 and G1, the GEO Nimiq satellites 2, 4, 5 and 6, and the NGSO Telesat Lightspeed constellation. ISED has the authority to issue licenses for the frequencies used by Canadian satellite systems, issue earth station licenses, and establish policies and standards upon which Telesat’s satellites and earth stations depend. The Minister responsible for ISED has broad discretion in exercising this authority to issue licenses, establish and amend conditions of licenses, and to suspend or even revoke them. The CRTC implements the broadcasting policy for Canada and can direct the allocation of satellite capacity to particular broadcasting undertakings. Telesat is required to pay “universal service” charges in Canada and has certain research and development and public benefits obligations that do not apply to other satellite operators with which it competes. These obligations could change at any time. With respect to market access, ISED maintains a list of foreign satellites approved to provide FSS in Canada. Telesat’s Telstar 11N, Telstar 12 VANTAGE, Telstar 14R/Estrela do Sul 2 and Telstar 19 VANTAGE satellites are currently authorized to serve the Canadian market in accordance with these procedures.

With respect to the Canadian authorization for the Telesat Lightspeed constellation, as a result of delays in the Telesat Lightspeed program, Telesat will not meet the current, required milestones as set out in the authorization. Accordingly, Telesat intends to seek to amend the milestones in the authorization. There is no assurance that such amendment request will be approved.

In the U.S., the Federal Communications Commission (“FCC”) regulates the provision of satellite services to, from or within the U.S. Certain of Telesat’s satellites are owned and operated through a U.S. subsidiary and are licensed by the FCC. This includes Telstar 11N and Telstar 12 VANTAGE. With respect to market access, operators can apply to have their satellites either placed on the FCC’s Permitted Space Station List (for certain frequencies) or be granted a declaratory ruling (for other frequencies). Telesat’s Anik F1, Anik F1R, Anik F2, Anik F3, Telstar 14R/Estrela do Sul 2 and Telstar 19 VANTAGE satellites are currently authorized to serve the U.S. market in accordance with these procedures, and some of the frequencies on Telstar 18 VANTAGE have access to the U.S. market through an earth station authorization.

The Telesat Lightspeed constellation has also been granted U.S. market access. The parameters of Telesat’s current Ka-band Telesat Lightspeed constellation design differ from the parameters of the market access grant from the U.S., which grant was for 117 satellites, and the market access grant from the U.S. is subject to post-grant conditions, including a requirement for providing an updated showing on orbital debris mitigation based on final system design. Telesat applied on May 26, 2020, in the FCC’s second processing round for Ka-band systems, to modify its U.S. market access grant to match the parameters of the Telesat Lightspeed constellation design at the time, including an increase in the number of authorized satellites to operate an expanded constellation of 1,671 satellites. On October 26, 2023 Telesat submitted an amendment to its pending second round application to provide the modified system design being developed with MDA. In general, satellites authorized in a later processing round must protect satellites authorized

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in a previous processing round from interference. There is no assurance that Telesat’s modification application, as amended, will be approved or, if approved, that it will not have conditions that preclude Telesat from being able to deliver an acceptable level of service in the U.S. There is also no assurance that the updated showing on orbital debris mitigation for the current design will be approved.

In addition, Telesat’s U.S. first round market access grant for Telesat Lightspeed has deployment milestones that require a certain percentage of the authorized satellites to be in service by a specific date, which is also subject to bond requirements. See “Business — Regulation — United States Regulatory Environment.” As Telesat could not meet its first deployment milestone, on October 26, 2023 Telesat submitted a milestone extension request. If an extension is not granted, Telesat will lose its first processing round U.S. market access grant either entirely or as to any number of satellites above the number for which the extension is granted. Telesat has requested that if an extension is not granted the bond be ported to the second round application mentioned above. If such request is denied, Telesat would be required to forfeit the US$5 million bond. If Telesat were to lose its first processing round grant and if Telesat is not granted access to the U.S. market under a second processing round application, Telesat could be prevented from offering its services in the United States, which could adversely affect results of operations, business prospects and financial condition.

In Brazil, the national telecommunications agency, ANATEL, regulates the granting of exploitation and landing rights to the operation of Brazilian and foreign satellites and their use to transport telecommunication signals. Certain of Telesat’s satellites are operated through a Brazilian subsidiary and are regulated by ANATEL pursuant to Concession Agreements. This includes Telstar 14R/Estrela do Sul 2 and Telstar 19 VANTAGE. With respect to market access ANATEL has also accredited the provision of service by foreign operators. Telesat’s Telstar 12 VANTAGE and Anik G1 satellites, and the Telesat Lightspeed constellation, are currently authorized to serve the Brazil market in accordance with these procedures.

The parameters of Telesat’s current Ka band Telesat Lightspeed constellation design differ from the parameters of the accreditation from ANATEL, which was for 298 satellites, and the expected date for entry into operation has changed. Telesat provided a technical update to ANATEL on January 12, 2024 that reflects the new design of 192 satellites plus six spares, along with a request to extend the deadline for entry into operation of the Telesat Lightspeed constellation.

Telstar 18 VANTAGE operates at the 138° EL orbital location under agreements with APT Satellite Company Limited (“APT”), which has been granted the right to use frequencies at the 138° EL orbital location by The Kingdom of Tonga. The ViaSat-1 satellite at the 115° WL orbital location, which has been granted the right to use frequencies at the 115° WL orbital location by the United Kingdom regulatory agency, OFCOM, includes a payload that Telesat owns and operates. The rights to use certain frequencies on Telstar 12 VANTAGE, Telstar 18 VANTAGE and Telstar 19 VANTAGE have also been granted by OFCOM.

Regulatory regimes governing market access

In addition to regulatory requirements governing the use of frequencies, most countries regulate transmission of signals to and from their territory, and Telesat is required to obtain and maintain authorizations to carry on business in the countries in which it operates. While regulators impose successful coordination with domestic operators as a condition for market access by foreign satellite operators, the U.S., and recently Brazil and the U.K. OFCOM, have adopted different approaches.

A ruling by Brazil effective November 1, 2021 gives domestic, or “national priority” status to foreign satellite operators based on date of receipt of a market access request. Telesat is a foreign license applicant in Brazil and therefore will be required to coordinate with other NGSO operators that have sought market access in Brazil at an earlier date than Telesat.

The U.S. rules, which are agnostic to domestic versus foreign, impose band splitting during in-line interference events if NGSO operators from the same processing round are unable to reach a coordination agreement, and as stated above, generally require systems authorized in subsequent processing rounds to protect systems authorized in previous processing rounds. Under the FCC’s rules, the first operator to launch a Ka-band LEO satellite as part of its authorized constellation will be able to choose which portion of the spectrum it will use when spectrum is split during in-line interference events. While Telesat believes it launched its first Ka-band satellite before other first processing round systems launched theirs, other operators have taken the position that they were first to launch and the FCC

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has not issued any guidance as to how it will determine who was “first to launch.” There are uncertainties as to how the FCC will apply this rule and as a result, there can be no assurance that Telesat will be deemed first to launch. As a result, the amount of spectrum that may be available to Telesat for its Telesat Lightspeed constellation in the U.S. is uncertain. In addition, the FCC has an on-going rulemaking proceeding in which it is considering proposals to modify its NGSO spectrum sharing rules. There can be no assurance how the outcome of this proceeding will affect Telesat.

A ruling by OFCOM on December 10, 2021 states applicants for an NGSO network license must demonstrate the ability to coexist with existing NGSO licensees, and with other NGSO license applicants taking-into-account the order with which the application is received. There are uncertainties as to how OFCOM will apply this rule, as there is no internationally agreed methodology to demonstrate coexistence. Telesat received its Satellite (Earth Station Network) license pursuant to the U.K. Wireless Telegraphy Act 2006 on November 14, 2022.

It is possible that other jurisdictions may adopt the U.S., the U.K., or the Brazilian approach. Some of the spectrum utilized by the Telesat Lightspeed constellation is also allocated to terrestrial fixed and mobile services and GEO satellite services. Other portions of the spectrum Telesat plans to use are under consideration for being designated or have been designated for terrestrial fixed and mobile services. While some jurisdictions have established rules for sharing the spectrum, many jurisdictions have yet to address this issue. In addition, even under the international rules governing coordination between satellite systems, while the process for sharing spectrum is well established with respect to GEO systems, it is only now being implemented for the first time for large NGSO systems that provide broadband services. Because the coordination of NGSO systems is both highly technically complex and new, uncertainties exist about spectrum sharing, which may limit Telesat’s ability to operate and hence monetize its Lightspeed constellation. Consequently, Telesat’s ability to use shared spectrum for its Telesat Lightspeed constellation may be adversely impacted by new rules, the implementation of existing rules, or the absence of rules for spectrum sharing.

Potential impacts of failure to obtain or maintain authorizations and approvals

If Telesat fails to obtain or maintain particular authorizations on acceptable terms, such failure could delay or prevent it from offering some or all of its services and adversely affect results of operations, business prospects and financial condition. In particular, Telesat may not be able to obtain all of the required regulatory authorizations for the construction, launch and operation of any of its future satellites, for the spectrum for these satellites and for its ground infrastructure, on acceptable terms or at all. Even if it were able to obtain the necessary authorizations the licenses it obtains may impose significant operational restrictions, or not protect it from interference that could affect the use of its satellites. Countries or their regulatory authorities may adopt new laws, policies or regulations, or change their interpretation of existing laws, policies or regulations, that could cause Telesat’s existing authorizations to be changed or cancelled, require it to incur additional costs, impose or change existing pricing, or otherwise adversely affect operations or revenues. As a result, any currently held regulatory authorizations are subject to rescission and renewal and may not remain sufficient or additional authorizations may be necessary that it may not be able to obtain on a timely basis or on terms that are not unduly costly or burdensome. Further, because the regulatory schemes vary by country, Telesat may be subject to regulations in foreign countries of which it not presently aware that it is not in compliance with, and as a result could be subject to sanctions by a foreign government.

Other potential regulatory impacts

In a number of countries, regulators are considering and may adopt new spectrum allocations for terrestrial mobile broadband and 5G, including in bands that are currently allocated to satellite services. New spectrum allocations may require satellite operators to vacate or share spectrum and may limit the spectrum that is available for satellite services, which could adversely impact Telesat’s business.

There are certain risks that have been raised in connection with the deployment of LEO constellations, including ensuring equitable access to orbit and associated spectrum resources, the potential for increased orbital debris and “light pollution” associated with light reflecting off satellites in the night sky. In a number of countries, regulators are considering and may adopt regulations to ensure the sustainable use of orbit and spectrum resources by satellites. For example, the European Commission is developing an EU Space Law which may contain design requirements for satellites, the compliance with which would be needed for obtaining the right to serve a country within the EU; the United States has an open proceeding (“Mitigation of Orbital Debris in the New Space Age”,

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see IB Docket No. 18-313) through which new requirements aimed at reducing orbital debris may be applied to NGSO satellite systems seeking US market access; the United Kingdom published a consultation to seek comments on whether space sustainability requirements should be tied to the authorization to operate a U.K.-licensed spacecraft; the International Telecommunications Union (ITU) is expected to carry out studies with a focus on the prevention of harmful interference, and ensuring the rational, equitable, efficient and economical use of the radiofrequency spectrum and associated orbit resources (see Resolution ITU-R 74 (RA-23)); and, the United Nations Office for Outer Space Activities (UNOOSA), through its Committee on the Peaceful Uses of Outer Space (COPUOS), is expected to further develop its “Guidelines for the Long-Term Sustainability of Outer Space Activities” first published in 2019. Certain of these laws and regulations address risks related to generating orbital debris. Because of the altitude of the orbits used by Telesat Lightspeed, a failed Telesat Lightspeed satellite will take longer to de-orbit and re-enter the Earth’s atmosphere through natural atmospheric drag, than our competitors who have deployed, or will be deploying, their satellites in lower altitude orbits. The increased de-orbit time of the Telesat Lightspeed satellites could make it harder to comply with any new orbital debris regulations that may be developed at national, regional or international levels. To the extent that governments impose restrictions or additional regulations to address any of these concerns regarding LEO constellations, it may adversely impact Telesat’s ability to successfully deploy the Telesat Lightspeed constellation.

The export from the U.S. of satellites and technical information related to satellites, earth station equipment and provision of services to certain countries are subject to State Department, Department of Commerce and Department of the Treasury regulations, in particular the International Traffic in Arms Regulations (“ITAR”), which currently include satellites on the list of items requiring export permits. These ITAR provisions may constrain Telesat’s access to technical information and may have a negative impact on Telesat’s international consulting revenues. In addition, Telesat and its satellite manufacturers may not be able to obtain and maintain necessary export authorizations, which could adversely affect its ability to procure new U.S.-manufactured satellites; control existing satellites; acquire launch services; obtain insurance and pursue its rights under insurance policies; or conduct its satellite-related operations and consulting activities.

Telesat’s operations may be limited or precluded by ITU rules or processes, including deployment milestones and timelines, and/or by the requirement to coordinate its operations with those of other satellite operators, and/or by the requirement to meet power limits to protect GEO

ITU requirements and interaction with other operators’ filings

The ITU, the United Nations specialized agency for information and communication technologies, regulates the global allocation of radio frequency spectrum and the registration of radio frequency assignments at any associated satellite orbit. Telesat participates in the activities of the ITU as an industry sector member; however, only member states (i.e. national administrations) can apply for radio frequency assignments at the ITU. Consequently, Telesat must rely on the relevant government administrations to represent its interests and secure frequency assignments, which are then licensed to Telesat by that administration.

Access to the radio frequency spectrum is governed by the ITU Radio Regulations, established in accordance with an international treaty, which contains the rules concerning frequency allocations and the procedure to obtain rights to use radio frequency assignments. The ITU Radio Regulations are periodically reviewed and revised at World Radiocommunication Conferences, which take place typically every four years. Terrestrial operators are increasingly seeking additional radio frequency assignments, including frequencies currently designated for exclusive or shared use by satellite systems, to support the increasing demand for terrestrial services. As a result, Telesat cannot guarantee that the ITU will not change its allocation decisions and rules in the future in a way that could limit or preclude Telesat’s use of some or all of Telesat’s existing or future spectrum.

The ITU Radio Regulations define the coordination, notification and recording procedures to obtain rights to use frequencies, with the aim to secure entry of the frequencies in the Master International Frequency Register (“MIFR”), including those frequencies used by Telesat’s GEO satellites, and Telesat’s planned Lightspeed constellation.

In most of the frequency bands used or intended to be used by Telesat, a “first-come, first-served” procedure applies among GEO networks or among NGSO systems whereby earlier-registered GEO networks are protected from interference due to later-registered GEO networks and earlier-registered NGSO systems are protected from interference due to later-registered NGSO systems. In order to comply with these rules, Telesat must coordinate the

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operation of its satellites, including any replacement satellite that has performance characteristics that are different from those of the satellite it replaces, with other satellites. This process requires potentially lengthy and costly negotiations with parties who operate or intend to operate satellites that could affect or be affected by its satellites. The failure to reach an appropriate arrangement with such satellite operators may render it impossible to secure entry of the frequencies into the MIFR and result in substantial restrictions on the use and operations of our existing satellites.

In the event there is no coordination agreement and interference occurs, the later-in-time system (i.e. the system operating under the ITU filing with lower priority) is obliged to cease causing interference. The ITU rules permit systems to operate on a “non-interference” basis. Among GEO networks there exists at the ITU an agreed methodology to calculate the maximum allowed interference; however, when an NGSO system is involved, so far there is no agreed methodology to determine how much interference a lower priority system can cause and still qualify as operating on a “non-interference” basis. Thus, it is not yet known either how much interference higher priority systems will be subject to from lower priority systems operating on a non-interference basis nor how large an operating impediment it will be for lower priority systems to operate on a non-interference basis. In addition, while the ITU Radio Regulations may require later-in-time systems to coordinate their operations with Telesat, it cannot guarantee that other operators will conduct their operations so as to avoid transmitting any signals that would cause harmful interference to the signals that Telesat, or its customers, transmit. In the extreme, this interference could require Telesat to take steps, or pay or refund amounts to customers that could have a material adverse effect on results of operations, business prospects and financial condition.

Between NGSO systems and GEO networks, in some cases a “first-come, first-served” procedure applies, and the discussion above is applicable. In other cases, NGSO must protect GEO regardless of the timing of the applications by meeting maximum power levels. Telesat Lightspeed can meet those power levels based on the current approach by the ITU to examine compliance; however, the approach to examine compliance may be updated following the results of technical studies commissioned by the 2023 World Radiocommunication Conference and to be completed in 2027. If certain proposed methods of testing compliance are adopted Telesat Lightspeed could be obliged to reduce power levels, and, depending on the degree of required power reduction, the system capacity could be impacted.

Finally, in the event disputes arise, the ITU’s Radio Regulations do not contain mandatory dispute resolution or enforcement regulations and neither the ITU specifically, nor international law generally, provides clear remedies if the ITU coordination process fails. Failure to coordinate its satellites’ frequencies successfully or to obtain or maintain other required regulatory approvals could have an adverse effect on results of operations, business prospects and financial condition, as well as on the value of the business.

ITU deployment milestones and timelines

Telesat’s in-orbit satellites do not currently occupy all of the GEO locations for which Telesat has obtained spectrum authorizations. In some cases, the Telesat satellite that occupies a GEO location is not designed to use all of the frequency spectrum for which it has been authorized. Similarly, Telesat has been granted regulatory authorizations for certain spectrum in NGSO orbits that are not yet occupied at all or in which the full complement of satellites have not yet been deployed.

In accordance with the ITU Radio Regulations, governments have rights to use radio frequency assignments at certain GEO orbital locations and in NGSO orbits. Certain of these governments have, in turn, authorized Telesat to use these radio frequency assignments. Under the ITU Radio Regulations, Telesat must bring-into-use (“BIU”) these frequency assignments within a fixed period of time, or the governments in question would lose their international rights, and the frequencies at the GEO orbital location or in the NGSO orbit likely would become available for use by another satellite operator. Once brought into use, the ITU rules require that there not be a period longer than three years without a satellite on-station that is capable of operating under the orbital parameters of a filing.

Under the ITU Radio Regulations satellite deployment milestones apply for ITU NGSO system filings. In general, there are milestone deadlines by which 10%, 50% and 100% of the satellites in the ITU filing must be deployed. In the case of the 10% and 50% milestones, if a deadline is missed it is still possible to take advantage of a deployment factor: if, at the 10% deadline, there are fewer than 10% of the total number of satellites in the ITU filing deployed, the modified total number of satellites shall not be greater than 10 times the number of satellites deployed; and if, at the 50% deadline, there are fewer than 50% of the total number of satellites in the ITU

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filing deployed, the modified total number of satellites shall not be greater than two times the number of satellites deployed. At the 100% milestone deadline, the number of satellites already deployed is the total number allowed for the ITU NGSO filing.

If Telesat is unable to place satellites at GEO locations or into NGSO orbits in a manner that satisfies the ITU Radio Regulations and national regulatory requirements, or if the ITU or national regulatory requirements were to change, or if it is unable to maintain satellites or make use of all of the spectrum for which it has been authorized at the GEO locations that it currently uses, Telesat may lose its rights to use these orbital resources and they would become available for other satellite operators to use. The loss of one or more of its orbital resources could negatively affect its plans and ability to implement its business strategy.

Telesat has a number of ITU filings which have lower priority than those of certain other Ka-band LEO operators. Operation under a later-in-time filing may put Telesat at a disadvantage with respect to operators having earlier-in-time filings, in the coordination process.

If Telesat does not obtain required security clearances from, and comply with any agreements entered into with, the U.S. DoD, or if Telesat does not comply with U.S. law, Telesat may not be able to continue to sell Telesat LEO services to the U.S. government.

To participate in classified U.S. government programs, Telesat may seek and obtain security clearances for one or more of its subsidiaries from the U.S. Department of Defense (“DoD”). Given Telesat’s non-U.S. domestication, Telesat has entered into agreements with the U.S. government that may limit its ability to control the operations of this subsidiary, as required under the national security laws and regulations of the U.S. If Telesat does not obtain and maintain these security arrangements, Telesat’s ability to sell LEO services to the U.S. government will be limited. As a result, Telesat’s business could be materially and adversely affected.

Risks Relating to Telesat’s Liquidity and Capital Resources

Telesat’s level of indebtedness may increase and reduce its financial flexibility.

Telesat has a significant amount of debt. As at December 31, 2023, it had total debt of $3,199.2 million and up to US$200.0 million of unused available revolving capacity under the Senior Secured Credit Facilities (not giving effect to $0.2 million of outstanding letters of credit). Telesat may incur additional debt in the future. The terms of Telesat’s Senior Secured Credit Facilities, the indenture governing its Senior Secured Notes, the indenture governing its 2026 Senior Secured Notes and the indenture governing its Senior Notes will allow it to incur substantial amounts of additional debt, subject to certain limitations. Its borrowings, current and future, will require interest payments and need to be repaid or refinanced, could require it to divert funds identified for other purposes to debt service and could create additional cash demands or impair its liquidity position and add financial risk for it. Diverting funds identified for other purposes for debt service may adversely affect Telesat’s business and growth prospects. If it cannot generate sufficient cash flow from operations to service its debt, it may need to refinance its debt at higher rates, dispose of assets, reduce or delay expenditures or issue equity to obtain necessary funds. Telesat does not know whether it would be able to take any of these actions on a timely basis, on terms satisfactory to it or at all.

Telesat’s substantial amount of debt may have important consequences. For example, it may: make it more difficult for it to satisfy its obligations under the Senior Secured Credit Facilities, the Senior Secured Notes the 2026 Senior Secured Notes and the Senior Notes; increase its vulnerability to general adverse economic and industry conditions; require it to dedicate a substantial portion of its cash flow from operations to make interest and principal payments on its debt, thereby limiting the availability of its cash flow to fund future capital expenditures, working capital and other general corporate requirements; limit its flexibility in planning for, or reacting to, changes in its business and in the industries that it services; place it at a competitive disadvantage compared with competitors that have less debt; and limit its ability to borrow additional funds, even when necessary to maintain adequate liquidity.

In addition to its debt service obligations, its operations require material expenditures on a continuing basis. Telesat’s ability to make scheduled debt payments, to refinance its obligations with respect to its indebtedness and to fund capital and non-capital expenditures necessary to maintain the condition of its operating assets and properties, as well as its capacity to fund the growth of its business, depends on its financial and operating performance.

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General economic conditions and financial, business and other factors affect operations and future performance. Many of these factors are beyond Telesat’s control. Telesat may not be able to generate sufficient cash flows to pay the interest on its debt, and future working capital, borrowings or equity financing may not be available to pay or refinance such debt.

The agreements governing Telesat’s debt, including the indentures governing its Senior Secured Notes, 2026 Senior Secured Notes, and Senior Notes and the credit agreement governing its Senior Secured Credit Facilities, contain various covenants that impose restrictions on it that may affect its ability to operate its business.

The agreements governing Telesat’s debt, including the indentures governing its Senior Secured Notes, the 2026 Senior Secured Notes and the Senior Notes and the Credit Agreement, impose operating and financial restrictions on its activities. For example, the Revolving Credit Facility requires it to comply with a first lien net leverage ratio of 5.75:1.00, tested quarterly when its Revolving Credit Facility is drawn by more than 35% of the Credit Facility amount. These indentures, the Credit Agreement and future debt agreements may also limit or prohibit its ability to, among other things:

• incur additional debt and issue disqualified stock and preferred shares;

• create liens;

• pay dividends, acquire shares of capital stock, make payments on subordinated debt or make investments;

• create or permit to exist specified restrictions on its ability to receive distributions from restricted subsidiaries;

• make certain investments;

• issue guarantees;

• issue or sell the capital stock of restricted subsidiaries;

• sell or exchange assets;

• modify or cancel Telesat’s satellite insurance;

• enter into certain transactions with affiliates; and

• effect mergers, consolidations, amalgamations and transfers of all or substantially all assets.

These restrictions on Telesat’s ability to operate its business could seriously harm its business by, among other things, limiting its ability to take advantage of financing, merger and acquisition and other corporate opportunities.

Various risks, uncertainties and events beyond Telesat’s control could affect its ability to comply with these covenants and maintain this financial ratio. Failure to comply with any of the covenants in its existing or future financing agreements could result in a default under those agreements and under other agreements containing cross-default provisions. A default would permit lenders to accelerate the maturity for the debt under these agreements and to foreclose upon any collateral securing the debt. Under these circumstances, Telesat might not have sufficient funds or other resources to satisfy all of its obligations, including its obligations under the Senior Secured Notes, the 2026 Senior Secured Notes or the Senior Notes.

Telesat’s unrestricted subsidiaries are expected to incur substantial additional debt secured by substantially all of the assets related to the Lightspeed constellation.

The agreements governing Telesat’s debt permit it to designate one or more of its restricted subsidiaries as unrestricted subsidiaries, subject to certain conditions. Certain of Telesat’s subsidiaries have been designated as unrestricted subsidiaries pursuant to those debt agreements. As a result, the covenants described above are not applicable to such subsidiaries. Telesat is developing, and intends to fund, construct and operate, its Lightspeed constellation, in one or more of its unrestricted subsidiaries. If the Lightspeed constellation program proceeds, these unrestricted subsidiaries are expected to incur substantial additional debt which would be secured by substantially all of the assets related to the Lightspeed constellation.

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The limitations imposed by financing agreements on Telesat’s ability to incur additional debt and to take other actions might significantly impair its ability to obtain other financing. To service its debt and to fund planned capital expenditures, Telesat will require a significant amount of cash, which may not be available.

Telesat’s ability to make payments on, or repay or refinance its debt, including its Senior Secured Notes, the 2026 Senior Secured Notes and Senior Notes, and to fund planned capital expenditures will depend largely upon its future operating performance. Telesat’s future performance, to a certain extent, is subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond its control. In addition, Telesat’s ability to borrow funds in the future to make payments on its debt will depend on the satisfaction of the covenants in the Senior Secured Credit Facilities, in the indentures governing its Senior Secured Notes, its 2026 Senior Secured Notes and its Senior Notes and other agreements it may enter into in the future. In addition, if its Revolving Credit Facility is drawn by more than 35% of the Credit Facility amount, it will be required to comply with a first lien net leverage ratio of 5.75:1.00, tested quarterly, and failure to comply will result in an event of default under the Revolving Credit Facility. These indentures and the Credit Agreement contain limitations on its ability to incur additional debt. Telesat cannot assure you that its business will generate sufficient cash flow from operations or that future borrowings will be available to it under the Senior Secured Credit Facilities or from other sources in an amount sufficient to enable it to pay its debt, including its Senior Secured Notes, its 2026 Senior Secured Notes and its Senior Notes, or to fund its other liquidity needs. As of December 31, 2023, it had US$200.0 million of unused available revolving capacity under its Senior Secured Credit Facilities (not giving effect to $0.2 million of outstanding letters of credit). In addition, Telesat’s ability to raise additional capital to refinance its debt or to fund its operations is dependent on capital market conditions.

If Telesat’s cash flows and capital resources are insufficient to service its indebtedness, it may be forced to reduce or delay capital expenditures, sell assets, seek additional capital or restructure or refinance its indebtedness, including its Senior Secured Notes, its 2026 Senior Secured Notes and its Senior Notes. These alternative measures may not be successful and may not permit it to meet its scheduled debt service obligations. Telesat’s ability to restructure or refinance its debt will depend on the condition of the capital markets and its financial condition at such time. Any refinancing of its debt could be at higher interest rates and may require it to comply with more onerous covenants, which could further restrict its business operations. In addition, the terms of existing or future debt agreements, including the Senior Secured Credit Facilities, the indentures governing its Senior Secured Notes, its 2026 Senior Secured Notes and its Senior Notes, may restrict Telesat from adopting some of these alternatives. In the absence of such operating results and resources, it could face substantial liquidity problems and might be required to dispose of material assets or operations to meet its debt service and other obligations. It may not be able to consummate those dispositions for fair market value or at all. Furthermore, any proceeds that Telesat could realize from any such dispositions may not be adequate to meet its debt service obligations then due.

Telesat may not be able to generate sufficient cash to service all of its indebtedness, and may be forced to take other actions to satisfy its obligations under its indebtedness, which may not be successful.

Telesat’s ability to make scheduled payments on or refinance its debt obligations depends on its financial condition and operating performance, which are subject to prevailing economic, industry and competitive conditions and to certain financial, business, legislative, regulatory and other factors beyond its control. Telesat may be unable to maintain a level of cash flow from operating activities sufficient to permit it to pay the principal, premium, if any, and interest on its indebtedness, including its Senior Secured Notes, its 2026 Senior Secured Notes and its Senior Notes.

If Telesat’s cash flow and capital resources are insufficient to fund its debt service obligations, it could face substantial liquidity problems and could be forced to reduce or delay investments and capital expenditures or to dispose of material assets or operations, seek additional debt or equity capital or restructure or refinance its indebtedness, including its Senior Secured Notes, its 2026 Senior Secured Notes and its Senior Notes. Future issuances of equity would dilute the ownership position of shareholders of Telesat and unitholders of Telesat Partnership. Telesat may not be able to effect any such alternative measures on commercially reasonable terms or at all and, even if successful, those alternative actions may not allow it to meet its scheduled debt service obligations. The Credit Agreement, the indentures governing the Senior Secured Notes, the 2026 Senior Secured Notes and the Senior Notes restrict its ability to dispose of assets and use the proceeds from those dispositions and may also restrict its ability to raise debt or equity capital to be used to repay other indebtedness when it becomes due. Telesat may not be able to consummate those dispositions or obtain proceeds in an amount sufficient to meet any debt service obligations then due.

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Telesat’s inability to generate sufficient cash flow to satisfy its debt obligations, or to refinance its indebtedness on commercially reasonable terms or at all, would materially and adversely affect its financial position and results of operations and its ability to satisfy its obligations under its Senior Secured Notes, its 2026 Senior Secured Notes and its Senior Notes.

If Telesat cannot make scheduled payments on its debt, it will be in default and holders of its Senior Secured Notes, its 2026 Senior Secured Notes and its Senior Notes could declare all outstanding principal and interest to be due and payable, the lenders under the Senior Secured Credit Facilities could terminate their commitments to loan money and declare all principal and interest to be due and payable, its secured lenders (including the lenders under the Senior Secured Credit Facilities, the Senior Secured Notes and the 2026 Senior Secured Notes) could foreclose against the assets securing their borrowings and Telesat could be forced into bankruptcy or liquidation (as and to the extent applicable to Telesat).

A lowering or withdrawal of the ratings assigned to Telesat’s Senior Secured Notes, Telesat’s 2026 Senior Secured Notes or Telesat’s Senior Notes by rating agencies may increase Telesat’s future borrowing costs and reduce Telesat’s access to capital.

Telesat’s ability to access capital markets is important to its ability to operate Telesat’s business. Increased scrutiny of the satellite industry and the impact of regulation, as well as changes in Telesat’s financial performance and unfavorable conditions in the capital markets could result in credit agencies reexamining Telesat’s credit ratings.

Telesat’s Senior Secured Notes, Telesat’s 2026 Senior Secured Notes and Telesat’s Senior Notes have a non-investment grade rating, and any rating assigned could be lowered or withdrawn entirely by a rating agency if, in that rating agency’s judgment, future circumstances relating to the basis of the rating, such as adverse changes, so warrant. A downgrade in Telesat’s credit ratings could restrict or discontinue Telesat’s ability to access capital markets at attractive rates and increase Telesat’s borrowing costs. There can be no assurance that any rating assigned to any of Telesat’s debt securities will remain in effect for any given period of time or that any such ratings will not be lowered, suspended or withdrawn entirely by a rating agency if, in that rating agency’s judgment, circumstances so warrant.

In 2022, Telesat’s credit rating was lowered by the credit ratings agencies, and it is possible that a further lowering of its credit rating may occur in the future. The credit rating agencies have also previously denoted Telesat as being in “selective default” as a result of having repurchased a portion its debt and they may do so again in the future. Absent an improvement in our ratings, the lowering of Telesat’s credit rating, and any future lowering of Telesat’s credit ratings, may make it more difficult or more expensive for Telesat to obtain additional debt financing or refinance its current debt. Moreover, real or anticipated changes in Telesat’s credit ratings will generally affect the market value of Telesat’s Senior Secured Notes, Telesat’s 2026 Senior Secured Notes and Telesat’s Senior Notes. In 2022, the market value of Telesat’s Senior Secured Notes, Telesat’s 2026 Senior Secured Notes and Telesat’s Senior Notes significantly decreased. Such decreases, and any future decreases in market value that may occur, may make it more difficult or more expensive for Telesat to obtain additional debt financing or refinance its current debt.

Telesat’s variable rate indebtedness subjects Telesat to interest rate risk, which could cause Telesat’s debt service obligations to increase significantly.

Borrowings under the Senior Secured Credit Facilities will be at variable rates of interest and will expose Telesat to interest rate risk. Assuming all revolving loans are fully drawn, each quarter percentage point change in interest rates would result in a $5.1 million change in interest expense on indebtedness under the Senior Secured Credit Facilities for the year ended December 31, 2023. Telesat has entered into, and in the future Telesat may enter into, interest rate swaps that involve the exchange of floating for fixed rate interest payments in order to reduce interest rate volatility. However, Telesat may not maintain interest rate swaps with respect to all or any of its variable rate indebtedness, and any swaps Telesat enters into may not fully mitigate Telesat’s interest rate risk, may prove disadvantageous or may create additional risks.

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Risks Relating to the Ownership of Telesat Public Shares and Telesat Partnership Units

Each of MHR and PSP Investments have substantial governance rights over Telesat, and their interests may conflict with or differ from the interests of the other Telesat shareholders.

Telesat’s governing documents contain special rights of each of MHR and PSP Investments to veto or participate in certain activities of Telesat. Such rights include, without limitation, the ability of each of MHR and PSP Investments to veto certain proposed changes to be taken by Telesat, including making changes to its respective organizational documents, the declaration and payment of non-pro rata dividends and certain tax or accounting elections. These documents also provide, among other things, for MHR and PSP Investments to each designate three directors to Telesat’s board of directors. See the sections of this annual report entitled “Composition of the Telesat Corporation Board and Committees” and “Related Party Transactions — Investor Rights Agreements” for additional information on the negotiated rights of MHR and PSP Investments. The interests of either or both of MHR and PSP Investments may diverge from those of other Telesat shareholders, and each may exercise its respective voting and other rights in a manner adverse to the interests of such other holders.

Each of MHR and PSP Investments have significant voting power in Telesat and their interests may conflict with or differ from the interests of the other Telesat shareholders.

Both MHR and PSP Investments, and their affiliates, maintain significant voting interests in Telesat. The voting interests of each of MHR and PSP Investments, along with their governance rights, provide MHR and PSP with substantial control over Telesat. As a result, MHR and PSP Investments will have the ability to influence many matters affecting Telesat and actions may be taken that other shareholders may not view as beneficial or align with their interests. Additionally, the market price of the Telesat Public Shares could be adversely effected due to the significant control exercised by MHR and PSP Investments. Such control may also discourage transactions involving an offer for control of Telesat in which an investor may otherwise receive a premium for its Telesat Public Shares over the then-current market price, or discourage competing proposals if a going private transaction or change of control transaction is proposed by either MHR or PSP Investments.

The vote of the holders of Class B Variable Voting Shares voting with respect to a particular matter may be diluted by the Golden Share.

In order to maintain Telesat’s status as Canadian, the Telesat Articles employ a variable voting mechanism by way of, amongst other controls, the “Golden Share,” as discussed further in Exhibit 2.6 under the section “Meetings of Shareholders and Voting Rights — Golden Share Mechanic.” The voting power attributed to the Golden Share will vary to ensure that the aggregate number of votes cast by Canadians, including Red Isle, with respect to a particular matter, will equal a simple majority of all votes cast in respect of such matter, resulting in the dilution of the voting power of Telesat’s non-Canadian shareholders. Moreover, if a person who is not Canadian controls one-third or more of the votes of the Telesat Corporation Shares and the Telesat Partnership Units, any voting power of that shareholder in excess of one-third of the voting power (less one vote) of the Telesat Corporation Shares will be attributed to the Golden Share and voted by the Trustee as provided in the Telesat Articles.

Telesat may raise additional funds through the sale of equity, which may be highly dilutive, may include terms with preferences that could adversely affect the rights of the shareholders of Telesat and/or may cause the market price of Telesat Public Shares to decline.

Telesat may raise additional equity capital to fund Telesat Lightspeed, including through the issuance of Telesat Corporation Shares or other equity interests of Telesat or any one or more of its subsidiaries. Telesat is currently in discussions with third parties regarding the sale of equity in its unrestricted subsidiaries that will own, operate and commercialize the Telesat Lightspeed constellation. Any such future issuance by Telesat and/or its subsidiaries could result in potential substantial ownership dilution to the shareholders of Telesat, which is not reflected in the beneficial ownership calculations presented in this annual report. In addition, newly issued securities may include liquidation or other preferences that could adversely affect the rights of the shareholders of Telesat and/or holders of Telesat Partnership Units. Furthermore, the future issuance of additional securities, whether equity or debt, by Telesat and/or

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its subsidiaries, or the perception that these issuances may occur, may cause the market price of the Telesat Public Shares to decline. This could also impair the ability of Telesat and/or its subsidiaries to raise additional capital through the sale of securities.

There is no assurance that Telesat and/or its subsidiaries will be able to obtain additional funding on acceptable terms or at all. It is not certain what effect, if any, that future sales or issuances of Telesat Corporation Shares or other equity interests of Telesat or any one or more of its subsidiaries will have on the trading price of Telesat Public Shares.

So long as the number of Class B Variable Voting Shares and Class B Units exceeds the number of Class A Shares, Class C Shares, Class A Units and Class C Units on matters submitted to a vote of the holders of equity in Telesat Corporation (but not with respect to Second Tabulation matters): (1) the issuance of additional Class B Variable Voting Shares would have the effect of diluting the voting power of the then existing holders of the Class B Variable Voting Shares and Class B Units, but not the voting power of the then existing holders of the Class A Shares, Class C Shares, Class A Units and Class C Units, and (2) the issuance of additional Class A Shares would have the effect of diluting the voting power of the then existing holders of the Class A Shares, Class C Shares, Class A Units and Class C Units, but not the voting power of the then existing holders of the Class B Variable Voting Shares and Class B Units. See Exhibit 2.6 “Meetings of Shareholders and Voting Rights — Golden Share Mechanic”, and “— Risks Relating to the Ownership of Telesat Public Shares and Telesat Partnership Units — The vote of the holders of Class B Variable Voting Shares voting with respect to a particular matter may be diluted by the Golden Share”.

The exchange of Telesat Partnership Units for Telesat Public Shares is subject to certain restrictions and the value of Telesat Public Shares received in any exchange may fluctuate. Holders of Telesat Partnership Units may be unable to exit their position when desired.

The governance documents of Telesat and Telesat Partnership provide for the holders of Telesat Partnership Units to elect to exchange their interests generally on a 1:1 basis (subject to the terms described in Exhibit 2.6 entitled “Meetings of Shareholders and Voting Rights — Golden Share Mechanic”) into the corresponding class of Telesat Corporation Shares at such holder’s election. Any such exchange will be facilitated by a third-party exchange agent engaged by Telesat for this purpose, and is expected to settle within two U.S. business days (T+2). Because the parties have no control over this third party but are relying on the exchange agent to complete each exchange, the timing of settlement cannot be guaranteed.

Telesat Partnership Units are non-transferrable and need to be exchanged for Telesat Corporation Shares in order for the holder to monetize its interest in Telesat Partnership, which could delay or impede such holder’s ability to access liquidity in the market. The Telesat Public Shares into which Telesat Partnership Units may be exchanged may be subject to significant fluctuations in value for many reasons, as further described herein. As described in greater detail below under the section entitled “— Risks Relating to Tax Matters,” it is also expected that the exchange of Telesat Partnership Units for Telesat Public Shares will be an exchange upon which gain or loss is recognized for U.S. federal income tax purposes.

Telesat has certain indemnification obligations and additional obligations to PSP Investments, which in certain circumstances will be uncapped and may result in dilution to the then other shareholders of Telesat.

Telesat and Telesat CanHoldco have indemnified PSP Investments on a grossed-up basis for PSP Investments’ pro rata share of costs relating to: (a) certain losses and litigation proceedings related to the Transaction, (b) certain losses with regard to Loral and out-of-pocket expenses of Loral and (c) certain tax matters. This indemnification will be (i) independent of the accuracy of the underlying representations and warranties and (ii) subject to additional, customary limitations. In the case of indemnification for certain tax matters only, there will be a cap of US$50,000,000 (other than with respect to defense costs and gross-up payments) and all other indemnification obligations will be uncapped. In addition, as provided in the Transaction Agreement, these indemnification obligations may be satisfied in the form of cash, unless, upon the determination of the board of directors of Telesat, making such cash payment would unduly constrain the liquidity needs of the go-forward business, in which case such indemnification obligations may be satisfied by issuing Class C Shares valued at the 30-day volume-weighted average price (“VWAP”) as of the date on which such payment is required to be made. Any such issuance of Class C Shares to Red Isle may result in dilution to the other shareholders of Telesat.

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There is no assurance that Telesat will pay any cash dividends for the foreseeable future or that investors will realize gains on Telesat Public Shares.

Any determination to pay dividends in the future will be at the discretion of Telesat’s board of directors, as described in Exhibit 2.6 under “Dividend Entitlements,” and will depend upon results of operations, financial condition, contractual restrictions, including agreements governing its debt and equity financing and any future indebtedness it may incur, restrictions imposed by applicable law and other factors Telesat’s board of directors deems relevant. The current expectation is that in the near term Telesat will not pay dividends, but will retain its cash on hand for the purpose of funding the Lightspeed constellation, funding other capital investments and/or paying down debt. Realization of a gain on the Telesat Public Shares will depend on the appreciation of the price of Telesat Public Shares, which may never occur. See “Dividend Policy.”

In certain circumstances, a limited partner of Telesat Partnership may lose its limited liability status.

The Limited Partnerships Act (Ontario) (“Limited Partnerships Act”) provides that a limited partner benefits from limited liability unless, in addition to exercising rights and powers as a limited partner, such limited partner takes part in the control of the business of a limited partnership of which such limited partner is a partner. Subject to the provisions of the Limited Partnerships Act and of similar legislation in other jurisdictions of Canada, the liability of each limited partner of Telesat Partnership for the debts, liabilities and obligations of Telesat Partnership will be limited to such limited partner’s capital contribution, plus such limited partner’s share of any undistributed income of Telesat Partnership.

The limitation of liability conferred under the Limited Partnerships Act may be ineffective outside Ontario except to the extent it is given extraterritorial recognition or effect by the laws of other jurisdictions. There may also be requirements to be satisfied in each jurisdiction to maintain limited liability. If limited liability is lost, limited partners of Telesat Partnership may be considered to be general partners (and therefore be subject to unlimited liability) in such jurisdiction by creditors and others having claims against Telesat Partnership.

The market price of the Telesat Public Shares may be volatile and may be affected by market conditions beyond Telesat’s control.

The market price of the Telesat Public Shares is subject to significant fluctuations in response to, among other factors:

• variations in Telesat’s operating results and market conditions specific to companies in the satellite services industry;

• changes in financial estimates or recommendations by securities analysts;

• announcements of innovations or new products or services by Telesat or its competitors;

• the emergence of new competitors;

• operating and market price performance of other companies that investors deem comparable;

• changes in Telesat’s board or management;

• sales or purchases of the Telesat Public Shares by insiders;

• commencement of, or involvement in, litigation;

• changes in governmental regulations; and

• general economic conditions and slow or negative growth of related markets.

In addition, if the market for stocks in Telesat’s industry experiences a loss of investor confidence, the market price of the Telesat Public Shares could decline for reasons unrelated to Telesat’s business, financial condition or results of operations.

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The market price of the Telesat Public Shares may be adversely affected by market conditions affecting the stock markets in general. Market conditions may result in volatility in the level of, and fluctuations in, market prices of stocks generally and, in turn, result in sales (including sales following the exchange of Telesat Partnership Units for Telesat Corporation Shares) of substantial amounts of the Telesat Public Shares in the market that may cause the market price of the Telesat Public Shares to fall dramatically. A weak global economy or other circumstances, such as changes in tariffs and trade, could also contribute to extreme volatility of the markets, which may also have an adverse effect on the market price of the Telesat Public Shares.

In addition, if any of the foregoing occurs, it could not only cause the price of the Telesat Public Shares to fall but also may expose Telesat to lawsuits that, even if unsuccessful, could be costly to defend and a distraction to the board of directors and management.

As a “foreign private issuer” under the rules and regulations of the SEC, Telesat is permitted to file less or different information with the SEC than a company incorporated in the U.S. or otherwise subject to these rules, and will follow certain home country corporate governance practices in lieu of certain NASDAQ requirements applicable to U.S. issuers.

Telesat is considered a “foreign private issuer” under the Exchange Act and is therefore exempt from certain rules under the Exchange Act, including the proxy rules, which impose certain disclosure and procedural requirements for proxy solicitations for U.S. and other issuers. Moreover, Telesat is not required to file periodic reports and financial statements with the SEC as frequently or within the same time frames as U.S. companies with securities registered under the Exchange Act. Telesat currently prepares its financial statements in accordance with IFRS. Telesat is not required to file financial statements prepared in accordance with or reconciled to U.S. GAAP so long as its financial statements are prepared in accordance with IFRS as issued by the International Accounting Standards Board. Telesat is not required to comply with Regulation FD, which imposes restrictions on the selective disclosure of material information to shareholders.

Telesat’s officers, directors and principal shareholders are exempt from the reporting and short-swing profit recovery provisions of Section 16 of the Exchange Act and the rules under the Exchange Act with respect to their purchases and sales of Telesat’s securities.

In addition, as a foreign private issuer, Telesat follows certain home country corporate governance practices in lieu of certain exchange requirements. A foreign private issuer must disclose in its Annual Reports filed with the SEC each exchange listing requirement with which it does not comply followed by a description of its applicable home country practice.

Telesat could lose its status as a “foreign private issuer” under current SEC rules and regulations if more than 50% of Telesat’s outstanding voting securities become directly or indirectly held of record by U.S. holders and one of the following is true: (i) the majority of Telesat’s directors or executive officers are U.S. citizens or residents; (ii) more than 50% of Telesat’s assets are located in the U.S.; or (iii) Telesat’s business is administered principally in the U.S. If Telesat loses its status as a foreign private issuer, it will no longer be exempt from the rules described above and, among other things, will be required to file periodic reports and annual and quarterly financial statements as if it were a U.S. domestic issuer. If this were to happen, Telesat would likely incur substantial costs in fulfilling these additional regulatory requirements and members of Telesat’s management would likely have to divert time and resources from other responsibilities to ensuring these additional regulatory requirements are fulfilled.

The Telesat Articles provide that the courts of British Columbia will be the sole and exclusive forum for certain shareholder litigation matters, which could limit the ability of holders of Telesat Shares to choose a judicial forum for disputes with Telesat or its directors and officers.

Under the Telesat Articles, unless Telesat consents in writing to the selection of an alternative forum, the courts of British Columbia will be the exclusive jurisdiction for (a) any derivative action or proceeding brought on behalf of Telesat; (b) any action or proceeding asserting a breach of a fiduciary duty owed to Telesat by any director, officer, or other employee of Telesat; (c) any action or proceeding asserting a claim arising pursuant to any

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provision of the BCBCA or the Telesat Articles; or (d) any action or proceeding asserting a claim otherwise related to the relationships among Telesat, its subsidiaries and its and their respective shareholders, directors and officers (but excluding claims related to the business of Telesat or its subsidiaries). The Telesat Articles further provide that if a shareholder commences an action outside of the courts of British Columbia, the shareholder will be deemed to consent to (i) the jurisdiction of the British Columbia courts and (ii) service on a shareholder being made by service on such shareholder’s counsel (in lieu of such shareholder), in respect of such action. While these provisions are intended to provide increased consistency in the application of law in the types of lawsuits to which it applies, as a result of these provisions, a U.S. shareholder may be forced to pursue such claims in the courts of British Columbia, which may entail added expense, compliance with an unfamiliar foreign legal regime, and difficulty in enforcing a judgment against non-Canadian persons.

The foregoing provisions should not apply to other types of suits brought to enforce a duty or liability created by the Exchange Act or any other claim for which United States federal courts have exclusive jurisdiction. Further, under the Securities Act, federal and state courts have concurrent jurisdiction over all suits brought to enforce any duty or liability created by the Securities Act, and equity holders cannot waive compliance with the federal securities laws and the rules and regulations thereunder. Accordingly, a court may determine that this provision is unenforceable to the extent it relates to such laws, rules and regulations, and to the extent it is enforceable, the provision may have the effect of discouraging lawsuits against Telesat’s directors and officers.

The Telesat Articles include a renunciation of certain business opportunities which could enable related parties to benefit from business opportunities that might otherwise be available to Telesat.

The Telesat Articles provide for the renunciation of certain enumerated business opportunities by Telesat and its subsidiaries. This includes an acknowledgement by Telesat that (i) its directors, (ii) its shareholders that employ, retain or are otherwise associated with, or designate or nominate, directors, and/or (iii) their affiliates, may become aware, from time to time, of certain business opportunities (such as investment opportunities) and may direct such opportunities to other businesses in which they have invested, with no obligation to make Telesat aware of any business opportunities that have been renounced by Telesat. Further, such businesses, including entities in which MHR and PSP Investments invest, may choose to compete with Telesat for renounced business opportunities and for business opportunities that have been separately discovered by the directors and their related parties, possibly causing these opportunities to not be available to Telesat or causing them to be more expensive for Telesat to pursue. These potential conflicts of interest could adversely impact Telesat’s business or prospects if attractive business opportunities are procured by such parties for their own benefit rather than for the benefit of Telesat.

Risks Relating to Tax Matters

U.S. Tax Risks

Telesat or Telesat Partnership could be treated as a U.S. corporation for U.S. federal income tax purposes.

Telesat and Telesat Partnership are classified as a non-U.S. corporation and a non-U.S. partnership, respectively, under general rules of U.S. federal income taxation. Unlike U.S. persons, who are generally subject to U.S. tax on worldwide income, non-U.S. persons are subject to U.S. income tax only on certain income from U.S. sources and from conducting business. Section 7874 of the Internal Revenue Code of 1986, as amended (the “Code”), and certain regulatory provisions promulgated under Section 7874, however, contain rules that, if applicable, could cause Telesat or Telesat Partnership to be taxed as a U.S. corporation for U.S. federal income tax purposes.

This treatment would apply only if (i) Telesat or Telesat Partnership acquired substantially all of the stock or assets of Loral (the “Acquisition Requirement”), (ii) following the acquisition, former shareholders of Loral own at least 80% of Telesat or Telesat Partnership by reason of their ownership of stock of Loral (the “80% Ownership Test”), (iii) the level of business activities conducted by Telesat or Telesat Partnership and its affiliates in Canada did not satisfy a certain minimum threshold level of activity (“Substantial Business Activities”), and (iv) in the case of Telesat Partnership, it is treated as a publicly traded partnership. These statutory and regulatory rules are complex and there is little administrative guidance regarding their application.

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Prior to consummation of the Transaction, Loral received an opinion from special tax counsel that upon consummation of the Transaction, neither Telesat nor Telesat Partnership should be taxed as a U.S. corporation. Such opinion, however, provides no assurance that the IRS may not take a position contrary to the opinion or that a court considering the issue may not hold otherwise. Further, such opinion does not consider any legislative proposals to lower the threshold for the 80% Ownership Test to 50% (or some other percentage). While the Transaction Agreement was entered into on November 23, 2020, it is possible that such legislative proposals, if enacted, might be applied on a retroactive basis, with no grandfather clause for transactions executed pursuant to a binding commitment entered into prior to such legislation’s enactment.

If it were determined that Telesat or Telesat Partnership should be taxed as a U.S. corporation for U.S. federal income tax purposes, Telesat or Telesat Partnership, as applicable, would be subject to U.S. federal tax return filing requirements and would be subject to U.S. tax on its worldwide income. Any foreign taxes, including Canadian taxes, paid by it would be creditable subject to several limitations, which could be material limitations.

Telesat or Telesat Partnership could be treated as a surrogate foreign corporation for U.S. federal income tax purposes and Loral could be treated as an expatriated entity, which might have adverse U.S. tax consequences for Loral and for shareholders of Telesat.

Even if neither Telesat nor Telesat Partnership is treated as a U.S. corporation as described above, Section 7874 of the Code and the associated regulations contain an alternative set of rules that could result in Telesat or Telesat Partnership being treated as a “surrogate foreign corporation,” and Loral being treated as an expatriated entity, if (i) the Acquisition Requirement is satisfied, (ii) following the acquisition, former shareholders of Loral own at least 60% of Telesat or Telesat Partnership by reason of their ownership of Loral stock (the “60% Ownership Test”), (iii) Telesat or Telesat Partnership does not have Substantial Business Activities in Canada, and (iv), in the case of Telesat Partnership, it is treated as a publicly traded partnership.

Prior to consummation of the transaction, Loral received an opinion from special tax counsel that, though it is not free from doubt, Telesat should not be treated as a surrogate foreign corporation. As mentioned above, Loral also received an opinion that Telesat Partnership should neither be treated as a publicly traded partnership, nor, accordingly, a surrogate foreign corporation. If Telesat Partnership were treated as a publicly traded partnership, it would be treated as a surrogate foreign corporation effective as of the consummation of the Transaction.

Special tax counsel’s opinion described above does not provide assurance that the IRS will not take a contrary position or that a court considering the issue would not hold otherwise. If it were determined that Telesat and/or Telesat Partnership should be treated as a surrogate foreign corporation and Loral should be treated as an expatriated entity, Loral would be subject to limitation as to the use of net operating losses and foreign tax credits to offset certain gain recognized in periods on or after the date of the Transaction. It is not anticipated that Loral will realize any material amount of gain upon or subsequent to the Transaction. If it did, however, the limitation as to the use of net operating losses and foreign tax credits could increase its potential U.S. tax liability.

Absent a change in facts and circumstances or law, it is anticipated that Telesat will eventually become a surrogate foreign corporation, and that Loral will become an expatriated entity, upon the exchange of a sufficient number of Telesat Partnership Units for Telesat Public Shares to cause both the 60% Ownership Test and the Acquisition Requirement to be satisfied. Moreover, if Loral were determined to be an expatriated entity before December 22, 2027, Loral would be required to recapture the deduction it claimed on its 2017 U.S. federal income tax return under Section 965(c) of the Code and to pay additional tax in an amount equal to 35% of the amount of such deduction. It is anticipated that the amount of such recapture would be US$38,500,000. Consequently, such recapture would substantially increase Loral’s U.S. federal income tax liability for the year in which it was determined to be an expatriated entity. Under the terms of the Transaction Agreement, PSP Investments may be entitled to a grossed-up indemnification payment for its pro rata share of such tax.

In addition, if Telesat were determined to be a surrogate foreign corporation, dividends paid by Telesat would not be treated as qualified dividend income under Section 1(h)(11) of the Code. Accordingly, non-corporate U.S. shareholders of Telesat would be subject to tax on such dividends at ordinary income rates of up to 37%, and not at the preferential 20% rate applicable under Section 1(h)(11) of the Code.

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Telesat may have been a passive foreign investment company (a “PFIC”) for 2021, 2022 and 2023 and could be classified as a PFIC in 2024 and subsequent taxable years, potentially resulting in adverse U.S. tax consequences to its U.S. shareholders.

If for any taxable year 75% or more of a foreign corporation’s gross income is passive income, or at least 50% of its assets are held for the production of, or produce, passive income, the foreign corporation is classified as a passive foreign investment company, or PFIC, for U.S. federal income tax purposes. Under the PFIC look-through rules, for the purposes of determining whether a corporation should be classified as a PFIC, the corporation will be treated as if it owns a proportionate share of the assets of, and earns a proportionate share of the income earned by, any subsidiary corporation if the corporation owns at least twenty-five percent (25%) (by value) of the stock of such subsidiary. Furthermore, for purposes of these rules stock owned by a partnership is treated as owned proportionately by its partners. During 2021 after the Transaction and during a portion of 2022, Telesat owned only approximately twenty-four percent (24%) of the Telesat Partnership Units. Telesat’s ownership interest in Telesat Partnership increased during 2022 and subsequently. As of December 31, 2022 and December 31, 2023, respectively, Telesat’s ownership interest in Telesat Partnership was 25.7% and 27.2%. While not free from doubt, Telesat believes that, by virtue of additional value associated with its interest as general partner of Telesat Partnership, Telesat owned at least twenty-five percent (25%) of the total value of Telesat Partnership (and indirectly in the wholly owned corporate subsidiaries of Telesat Partnership) during 2021 and 2022. In addition, Telesat owned more than 25% of the total value of Telesat Partnership (and indirectly in the wholly owned corporate subsidiaries of Telesat Partnership) during 2023. Based on the foregoing, Telesat believes it was not a PFIC for any of its 2021-2023 taxable years, taking into account the income and assets of the wholly owned corporate subsidiaries of Telesat Partnership. Telesat can provide no assurance that the IRS will not successfully challenge this position upon any audit of a U.S. holder.

The determination as to whether Telesat should be classified as a PFIC for 2024 and years thereafter will be a factual determination that must be made annually at the close of each taxable year and will be based upon the composition of Telesat’s income and assets (including entities in which Telesat holds at least a 25% interest), which may be subject to change. Because PFIC status is determined annually based on Telesat’s income and assets for the entire taxable year, it is not possible to determine whether Telesat will be characterized as a PFIC for 2024 or any other future year until after the close of that year. Subject to the foregoing, while Telesat intends to manage its business so as to avoid PFIC status to the extent possible and consistent with its other business goals, Telesat cannot predict whether its business plans will allow it to avoid PFIC status. In addition, because the market price of the Telesat Public Shares has fluctuated and is likely to fluctuate in the future and because that market price may affect the determination of whether Telesat is a PFIC, there can be no assurance that Telesat will not be a PFIC for any taxable year.

U.S. holders of Telesat Public Shares could suffer adverse tax consequences as a result of the classification of Telesat as a PFIC, including having gains realized on the sale of the shares treated as ordinary income, rather than capital gain, the loss of the preferential rate applicable to dividends received on the Telesat Public Shares, having interest charges apply to distributions by Telesat and the proceeds of the sale of Telesat Public Shares and subjection to additional reporting requirements. Telesat will use reasonable efforts to provide to U.S. holders the information needed to report income and gain pursuant to a “qualified electing fund” election, which election would alleviate some of the adverse tax consequences of PFIC status.

Distributions from Telesat Partnership may be insufficient to pay tax on the allocation of income and/or gain for U.S. tax purposes.

While Telesat Partnership intends to make certain distributions to holders of Telesat Partnership Units, a holder of Telesat Partnership Units may receive allocations of income and/or capital gains in a year for U.S. tax purposes without receiving sufficient cash distributions from Telesat Partnership for that year to pay any U.S. or other tax the holder may owe because of such allocation. In addition, there can be no assurance that Telesat Partnership will in fact make cash distributions as intended. Even if Telesat Partnership is unable to distribute cash in amounts that are sufficient to fund a holder’s tax liability, such holder will nonetheless be required to pay any applicable income taxes.

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Canadian Tax Risks

Telesat Partnership may be liable to pay tax under the SIFT Rules which may reduce after-tax returns to holders of Telesat Partnership Units and holders of Telesat Public Shares.

Telesat Partnership is a “SIFT partnership” for the purposes of the Income Tax Act (Canada) (the “Tax Act”). As such, Telesat Partnership is subject to SIFT tax on its “taxable non-portfolio earnings” (as defined in the Tax Act), if any, including income, other than taxable dividends, from “non-portfolio property” (as defined in the Tax Act). In particular, Telesat Partnership would generally be required to pay SIFT tax if its Loral stock were non-portfolio property and the unlimited liability company (“Can ULC”) formed under the laws of British Columbia by Loral Holdings Corporation (“Loral Holdings”) and Telesat CanHoldco paid a dividend to Loral Holdings, subject to any deductions that may be available to Telesat Partnership in computing the income from its Loral stock. In particular, provided Loral Holdings and Loral each pay corresponding dividends in the same taxation year as any dividend paid by Can ULC, Telesat Partnership may have available to it and intends to claim sufficient deductions so that it does not have net income from non-portfolio property. Although it is intended that Loral Holdings and Loral would each pay corresponding dividends in the same taxation year as any dividend paid by Can ULC, no assurance can be given that such dividends will be paid or that such deductions will be available. If Telesat Partnership were required to pay SIFT tax, after-tax returns to holders of Telesat Partnership Units and indirectly to holders of Telesat Public Shares may be reduced.

Telesat may be liable to pay tax in respect of dividends paid by Can ULC to Loral Holdings.

Loral Holdings is a controlled foreign affiliate of Telesat Partnership for purposes of the Tax Act. As such, Telesat Partnership is required to include in its income for a year its share of the “foreign accrual property income” or “FAPI” (as defined in the Tax Act) of Loral Holdings for such year, including its proportionate share of any dividends paid by Can ULC to Loral Holdings in such year. In turn, Telesat must include in income its share of the FAPI (including such dividends paid by Can ULC to Loral Holdings) of Telesat Partnership. However, if Loral Holdings and Loral each pay corresponding dividends in the same taxation year, and provided that Loral is a “foreign affiliate” of Telesat for relevant purposes of the Tax Act, Telesat may deduct in computing its taxable income a prescribed portion of such dividends received by it through Telesat Partnership. In determining the amount of such dividends from Loral that may be deducted in computing its taxable income, Telesat intends not to take into account any deduction claimed by Telesat Partnership pursuant to subsection 91(5) of the Tax Act. Telesat believes that such interpretation is consistent with the rationale expressed by the Canada Revenue Agency (“CRA”) for its published administrative position in this regard, but no assurance can be given. If the deduction that Telesat would otherwise claim were limited, or if a deduction claimed by Telesat were denied or otherwise not available, Telesat may be liable to pay tax on some or all of its share of FAPI resulting from any dividends paid by Can ULC to Loral Holdings and after-tax returns to holders of Telesat Public Shares may be reduced.

Non-Canadian limited partners may be subject to Canadian federal income tax with respect to any Canadian source business income earned by Telesat Partnership and may be required to file Canadian tax returns.

Telesat, as general partner, intends to manage the affairs of Telesat Partnership to the extent possible so that it does not carry on business in Canada for the purposes of the Tax Act. Nevertheless, because the determination of whether Telesat Partnership is carrying on business in Canada for the purposes of the Tax Act is a question of fact that is dependent upon the relevant circumstances, the CRA might successfully assert that Telesat Partnership carries on business in Canada for the purposes of the Tax Act.

If Telesat Partnership were considered to carry on business for the purposes of the Tax Act, holders of Telesat Partnership Units who are not, and are not deemed to be, resident in Canada for purposes of the Tax Act (i) would be subject to Canadian federal income tax on their proportionate share of any Canadian source business income earned or considered to be earned by Telesat Partnership, subject to any relief that may be provided by any applicable income tax treaty or convention, and (ii) may be required to file a Canadian federal income tax return.

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Payments of dividends by Telesat CanHoldco to Telesat Partnership will be subject to Canadian federal withholding tax and if CRA does not apply their administrative position Telesat CanHoldco may be liable for additional amounts of Canadian federal withholding tax plus any associated interest and penalties in certain circumstances.

Dividends paid or credited or deemed to be paid or credited to a partnership that is not a “Canadian partnership” (as defined in the Tax Act) by a corporation resident in Canada are subject to withholding tax at a 25% rate.

Telesat Partnership is not a “Canadian partnership” for purposes of the Tax Act. However, in determining the rate of Canadian federal withholding tax applicable to dividends paid by Telesat CanHoldco to Telesat Partnership, Telesat, as general partner, expects Telesat CanHoldco to look through Telesat Partnership to its partners and, having regard to the CRA’s administrative practice in similar circumstances, not to withhold on that portion of a dividend attributable to Canadian resident partners of Telesat Partnership (including Telesat) and to take into account any reduced rates of Canadian federal withholding tax to which non-Canadian limited partners may be entitled under an applicable income tax treaty or convention.

There is a risk that the CRA will not apply its administrative practice such that Telesat CanHoldco may be liable for additional amounts of Canadian federal withholding tax plus any associated interest and penalties if it withholds tax at less than the 25% rate under the Tax Act.

Distributions from Telesat Partnership may be insufficient to pay tax on the allocation of income and loss for tax purposes.

While Telesat Partnership intends to make certain distributions to holders of Telesat Partnership Units, a holder may receive allocations of income and/or capital gains in a year for purposes of the Tax Act without receiving sufficient distributions from Telesat Partnership for that year to pay any tax the holder may owe because of such allocation. In addition, there can be no assurance that Telesat Partnership will in fact make cash distributions as intended. Even if Telesat Partnership is unable to distribute cash in amounts that are sufficient to fund a holder’s tax liability, such holder will nonetheless be required to pay any applicable income taxes.

Certain Canadian rules in respect of foreign tax credits may apply to Telesat Partnership.

The Tax Act contains anti-avoidance rules to address certain foreign tax credit generator transactions (the “Foreign Tax Credit Generator Rules”). Under certain Foreign Tax Credit Generator Rules, the “foreign accrual tax” (which is a deduction which may be available under the Tax Act) applicable to a FAPI inclusion of Telesat Partnership may be denied in certain specified circumstances, including where the direct or indirect share of the income of any member of Telesat Partnership that is a person resident in Canada or a “foreign affiliate” of such a person is, under a “relevant foreign tax law” (within the meaning attributed to it in the Tax Act), less than such member’s share of such income for purposes of the Tax Act. Although the Foreign Tax Credit Generator Rules are not expected to apply to Telesat Partnership, no assurances can be given in this regard. If the Foreign Tax Credit Generator Rules apply, the “foreign accrual tax” applicable to a FAPI inclusion will be denied and after-tax returns to holders of Telesat Public Shares may be reduced.

Canadian tax laws, or the interpretation thereof, could change in a manner which adversely affects Telesat Partnership, Telesat, and holders of Telesat Partnership Units and/or Telesat Public Shares.

There is a risk that Canadian tax laws, or the interpretation thereof, could change in a manner that adversely affects Telesat Partnership, Telesat, or the holders of Telesat Partnership Units and/or Telesat Public Shares.

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Changes in tax laws and unanticipated tax liabilities could adversely affect profitability.

Telesat is subject to taxes in Canada and numerous foreign jurisdictions. Telesat’s tax liabilities could be adversely affected in the future by a number of factors, including changes in the mix of earnings in countries with differing statutory tax rates, changes in the valuation of deferred tax assets and liabilities, changes in tax laws, and the outcome of tax audits in various jurisdictions around the world. Many of the countries in which Telesat does business have or are expected to adopt changes to tax laws as a result of the Base Erosion and Profit Shifting (“BEPS”) final proposals from the Organisation for Economic Co-operation and Development (“OECD”) and specific country anti-avoidance initiatives. Legislation to implement Canadian interest expense deduction limitation rules, consistent with the OECD’s recommendations as a result of the BEPS final proposals is currently before Parliament as Bill C-59. The rules will be effective for taxation years starting in 2024 and would generally limit Canadian interest deductions and financing expenses to 30% of tax EBITDA.

Such tax law changes increase uncertainty and may adversely affect Telesat’s tax provision. Telesat regularly assesses all of these matters to determine the adequacy of its tax provision, which is subject to significant judgment.

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ITEM 4. INFORMATION OF THE COMPANY

A. History and Development of the Company

Telesat Corporation was incorporated under the Business Corporations Act (British Columbia) on October 21, 2020. Telesat Corporation is the general partner of Telesat Partnership LP, which was formed under the Limited Partnership Act (Ontario) on November 12, 2020. We directly or indirectly own 100% of all of our operating subsidiaries.

On November 18, 2021 and November 19, 2021, Telesat Corporation (“Telesat” or the “Company”), along with the other parties to the Transaction Agreement (as defined below) consummated the transactions (collectively, the “Transaction”) contemplated by the Transaction Agreement and Plan of Merger (as amended, the “Transaction Agreement”), dated as of November 23, 2020, by and among Telesat, Telesat Canada, a Canadian corporation (“Telesat Canada”), Loral Space & Communications Inc., a Delaware corporation (“Loral”), Telesat Partnership LP, a limited partnership formed under the laws of Ontario, Canada (“Telesat Partnership”), Telesat CanHold Corporation, a corporation incorporated under the laws of British Columbia, Canada (“Telesat CanHoldco”), Lion Combination Sub Corporation, a Delaware corporation and wholly owned subsidiary of Loral (“Merger Sub”), Public Sector Pension Investment Board, a Canadian Crown corporation (“PSP Investments”), and Red Isle Private Investments Inc., a Canadian corporation (“Red Isle”).

The Transaction was effected in accordance with the Transaction Agreement through a series of transactions, including: (i) on November 18, 2021, Red Isle contributing 272,827 Telesat Canada Non-Voting Participating Preferred Shares to Telesat in exchange for Class C fully voting shares of Telesat and the balance of its equity interest in Telesat Canada to Telesat Partnership in exchange for Class C units of Telesat Partnership (“Class C Units”); (ii) on November 18, 2021 and pursuant to stockholder contribution agreements, the contribution by current and former members of management of Telesat Canada of their Telesat Canada Non-Voting Participating Preferred Shares to Telesat in exchange for newly issued Class A common shares of Telesat (the “Class A Common Shares”) if such contributing shareholder was Canadian (as such term is defined in the Investment Canada Act) or newly issued Class B variable voting shares of Telesat (the “Class B Variable Voting Shares”) if such contributing shareholder was not Canadian (as such term is defined in the Investment Canada Act); (iii) on November 18, 2021 and pursuant to the director contribution agreement, the contribution by John Cashman and Clare Copeland of their Telesat Canada Director Voting Preferred Shares to Telesat Partnership in exchange for interests in Telesat Partnership, which were subsequently redeemed by Telesat Partnership for cash on November 19, 2021; (iv) on November 18, 2021 and pursuant to optionholder exchange agreements, the exchange of options, tandem stock appreciation rights and restricted stock units in respect of Telesat Canada for corresponding instruments in Telesat with the same vesting terms and conditions; and (v) on November 19, 2021, the merger of Merger Sub with and into Loral (the “Merger”), with Loral surviving the Merger as a wholly owned subsidiary of Telesat Partnership and the other Loral stockholders receiving shares of Telesat or units of Telesat Partnership as described below.

Under the terms of the Transaction Agreement, at the effective time of the Merger (the “Effective Time”), each share of Loral common stock outstanding immediately prior to the Effective Time was converted into the right to receive (a) if the Loral stockholder validly made an election to receive units of Telesat Partnership pursuant to the Merger (a “Unit Election”), one (1) newly issued Class A unit of Telesat Partnership if such Loral stockholder was Canadian (as such term is defined in the Investment Canada Act), and otherwise one (1) newly issued Class B unit of Telesat Partnership, (b) if the Loral stockholder validly made an election to receive shares of Telesat (a “Shares Election”), one (1) newly issued Class A Common Share if such Loral stockholder was Canadian (as such term is defined in the Investment Canada Act), or (c) if the Loral stockholder validly made a Shares Election and was not Canadian, or did not validly make a Unit Election or a Shares Election, one (1) newly issued Class B Variable Voting Share. Following the Transaction, Telesat Canada became an indirect wholly owned subsidiary of Telesat.

In addition, on November 18, 2021, Telesat entered into a trust agreement and trust voting agreement with Telesat Partnership, TSX Trust Company, as the trustee of Telesat Corporation Trust and, in the case of the trust agreement, Christopher DiFrancesco, effectuating the voting trust relating to the voting rights of units of Telesat Partnership.

Following the completion of the Transaction, our authorized share capital includes Class A Common Shares, Class B Variable Voting Shares (together with the Class A Common Shares, the “Telesat Public Shares”), Class C fully voting shares (the “Class C Fully Voting Shares”), Class C limited voting shares (the “Class C Limited Voting Shares”, and together with the Class C Fully Voting Shares, “Class C Shares”, and the Class C Shares together with the

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Telesat Public Shares, the “Telesat Corporation Shares”), a Class A Special Voting Share (the “Class A Special Voting Share”), a Class B Special Voting Share (the “Class B Special Voting Share”), a Class C Special Voting Share (the “Class C Special Voting Share”, and together with the Class A Special Voting Share and Class B Special Voting Share, the (“Special Voting Shares”), the Golden Share (the “Golden Share”) and “blank check” Class A Preferred Shares (the “Class A Preferred Shares”). The Special Voting Shares and the Golden Share have no material economic rights.

The Telesat Public Shares commenced trading at NASDAQ and the Toronto Stock Exchange under the ticker symbol “TSAT” on November 19, 2021. The Telesat Partnership Units are not listed on an exchange.

Our fiscal year ends on December 31 of each calendar year.

Our agent for service of process in the United States is Puglisi & Associates, whose address is 850 Library Avenue, Suite 204, Newark, Delaware 19711.

The registered office of Telesat Corporation is located at 666 Burrard St. #1700, Vancouver, BC V6C 2X8 and our head office is located at 160 Elgin Street, Ottawa, Ontario, Canada K2P 2P7. The head office of Telesat Partnership is located at 160 Elgin Street, Ottawa, Ontario, Canada K2P 2P7. Our telephone number at our head and registered office is (613) 748-8700 ext. 2268. Our website address is https://www.telesat.com. Information contained on, or accessible through, our website is not part of this Annual Report and the inclusion of our website address in this Annual Report is an inactive textual reference.

For a description of our principal capital expenditures, see Item 4B. “Information on the Company” — “Business Overview”.

Additional Information on the Company

The SEC maintains an internet site that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at https://www.sec.gov. Our filings with the SEC can be accessed free of charge at this website.

B. Business Overview

The following discussion of the business of Telesat is qualified by reference to, and should be read in conjunction with, the “Risk Factors” starting on page 8 of this annual report.

Business Overview

Telesat is a leading global satellite operator, providing its customers with mission-critical communications services since the start of the satellite communications industry in the 1960s. Through a combination of advanced satellites and ground facilities and a highly expert and dedicated staff, our communications solutions support the requirements of sophisticated satellite users throughout the world. Over more than 50 years of operating history, we have demonstrated a deep commitment to customer service and led the way on many of the industry’s most ground-breaking innovations.

After decades of developing and successfully operating our GEO satellite services business, we have commenced the development of what we believe will be one of the world’s most advanced constellations of LEO satellites and integrated terrestrial infrastructure, called “Telesat Lightspeed” — a platform designed to revolutionize the provision of global broadband connectivity. Telesat Lightspeed has the potential to transform global satellite and terrestrial communications industries, dramatically increasing the Company’s addressable market and significantly expanding its growth potential. We seek to benefit from our historically strong and stable GEO-based satellite business and, by continuing to develop and deploy Telesat Lightspeed, capitalize on the growing demand for global broadband connectivity.

Our History as a Company

Telesat, as it exists today, is the result of the 2007 combination of Telesat Canada and Loral Skynet, although the company’s history dates to 1969, when the Canadian Parliament passed the Telesat Canada Act. In 1972, Telesat Canada launched the world’s first domestic commercial satellite in geostationary orbit and the Company has been a pioneer and leading innovator in satellite communications ever since. Telesat Canada launched the first commercial Ku-band satellite (officially, the DTH satellite television service) in 1978, Canada’s first direct broadcast satellite

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(“DBS”) in 1999 and the world’s first consumer 2-way Ka-band broadband internet service via satellite in 2004. Since the mid-1970s, Telesat Canada has provided advanced satellite services for voice, data and broadcast communications in the Americas, including in Canada’s far North.

Loral Skynet traced its history to two early companies in the U.S. satellite communications industry: AT&T Skynet and Orion Satellite Corporation (“Orion”). AT&T Skynet and its predecessor organizations in AT&T’s Bell Laboratories effectively launched the commercial satellite communications industry by demonstrating the first trans-Atlantic satellite delivery of television on Telstar 1 in 1962. Through the 1970s, 1980s and 1990s, AT&T Skynet provided state-of-the-art telephone and television services in the U.S. for AT&T, as well as video distribution and contribution services for U.S. broadcasters and cable operators using the Comstar and Telstar series of satellites. Orion was formed in 1988 for the purpose of providing international data services. In 1994, Orion launched Orion 1, which provided early trans-Atlantic services between the U.S. and Europe. Orion was the second U.S. licensed “separate system” authorized to compete directly with the intergovernmental organization INTELSAT for certain types of international satellite services.

In 1997, AT&T Skynet was acquired from AT&T by LSC Holdings, became Loral Skynet, and expanded its focus from the U.S. to become a global satellite operator. Orion was acquired by LSC Holdings in 1998 and its operations were integrated with those of Loral Skynet in 1999.

On October 31, 2007, PSP Investments, and Loral acquired 100% of the stock of Telesat Canada from BCE Inc., Canada’s largest communications company (the “Skynet Transaction”). Following the Skynet Transaction, the Loral Skynet and Telesat Canada businesses and assets were combined.

On November 18, 2021 and November 19, 2021, Telesat Corporation, a corporation incorporated under the laws of the Province of British Columbia, Canada, along with the other parties to the Transaction Agreement consummated the Transaction. See “Related Party Transactions — The Transaction”.

The Transaction was effected in accordance with the Transaction Agreement through a series of transactions, including: (i) on November 18, 2021, Red Isle contributing 272,827 Telesat Canada Non-Voting Participating Preferred Shares to Telesat in exchange for Class C Fully Voting Shares of Telesat and the balance of its equity interest in Telesat Canada to Telesat Partnership in exchange for Class C Units of Telesat Partnership; (ii) on November 18, 2021 and pursuant to stockholder contribution agreements, the contribution by current and former members of management of Telesat Canada of their Telesat Canada Non-Voting Participating Preferred Shares to Telesat in exchange for newly issued Class A Common Shares of Telesat if such contributing shareholder is Canadian (as such term is defined in the Investment Canada Act) or newly issued Class B Variable Voting Shares of Telesat if such contributing shareholder is not Canadian (as such term is defined in the Investment Canada Act); (iii) on November 18, 2021 and pursuant to the director contribution agreement, the contribution by John Cashman and Clare Copeland of their Telesat Canada Director Voting Preferred Shares to Telesat Partnership in exchange for interests in Telesat Partnership, which were subsequently redeemed by Telesat Partnership for cash on November 19, 2021; (iv) on November 18, 2021 and pursuant to optionholder exchange agreements, the exchange of options, tandem stock appreciation rights and restrict stock units in respect of Telesat Canada for corresponding instruments in Telesat with the same vesting terms and conditions; and (v) on November 19, 2021, the merger of Merger Sub with and into Loral, with Loral surviving the Merger as a wholly owned subsidiary of Telesat Partnership and the other Loral stockholders receiving shares of Telesat or units of Telesat Partnership as described below.

Under the terms of the Transaction Agreement, at the Effective Time, each share of Loral common stock outstanding immediately prior to the Effective Time was converted into the right to receive (a) if the Loral stockholder validly made a Unit Election, one newly issued Class A Unit of Telesat Partnership if such Loral stockholder was Canadian (as such term is defined in the Investment Canada Act), and otherwise one newly issued Class B unit of Telesat Partnership, (b) if the Loral stockholder validly made a Shares Election, one newly issued Class A Common Share if such Loral stockholder was Canadian (as such term is defined in the Investment Canada Act), or (c) if the Loral stockholder validly made a Shares Election and was not Canadian, or did not validly make a Unit Election or a Shares Election, one newly issued Class B variable voting share. Following the Transaction, Telesat Canada became an indirect wholly owned subsidiary of Telesat.

In addition, on November 18, 2021, Telesat entered into the trust agreement and trust voting agreement with Telesat Partnership, TSX Trust Company as the trustee of Telesat Corporation Trust and, in the case of the trust agreement, Christopher DiFrancesco, effectuating the voting trust relating to the voting rights of units of Telesat Partnership.

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Following the completion of the Transaction, our authorized share capital includes Class A Common Shares, Class B Variable Voting Shares, Class C Fully Voting Shares, Class C Limited Voting Shares, a Class A Special Voting Share, a Class B Special Voting Share, a Class C Special Voting Share, the Golden Share and Class A Preferred Shares. The Special Voting Shares and the Golden Share have no material economic rights.

In March 2022, Telesat established Telesat Government Solutions (TGS), a wholly-owned subsidiary of Telesat Canada. TGS has been approved by the U.S. Government Defense Counterintelligence and Security Agency as a Foreign Ownership, Control, or Influence — mitigated entity and operates under a Special Security Agreement with the U.S. Government.

Industry Overview and Trends

We compete in the market for the provision of voice, data, video and internet connectivity services worldwide. Services of this type are provided using various technologies, including satellite networks. We provide communications links between fixed points on the earth’s surface, referred to as point-to-point services, and from one point to multiple points, referred to as point-to-multipoint services. We also provide services to mobile platforms, such as ships and airplanes. Over the last several decades, deregulation and privatization have significantly reshaped the satellite sector. In addition, the sector has undergone consolidation, with regional and national operators being acquired by larger companies or seeking to partner with other providers. There have also been many new, smaller entrants, including many governmental operators, launching national or regional satellite programs. More recently, non-geostationary satellite systems have been announced and are in various stages of development, deployment and operation.

Satellite Systems

A generic satellite system consists of a space segment and an earth segment. The “space segment” is comprised of the satellites and the Telemetry, Tracking and Control (“TT&C”) systems and facilities used to control and monitor the satellites. The “earth segment” is made up of all of the communication earth stations and other devices that access operational satellites. A satellite has two primary components: the communications payload and the spacecraft bus. In its simplest form, the communications payload consists of the antennas and transponders which receive the signals from earth at one frequency, amplify them, and transmit them back to earth at a different frequency. The spacecraft bus is essentially comprised of all of the non-communications equipment, including the electrical and TT&C subsystems, the propulsion and thermal subsystems and the spacecraft structure itself.

GEO satellites circle the earth from orbital locations approximately 22,300 miles (35,700 kilometers) above the equator. The speed at which they orbit the earth corresponds to the speed of the earth’s rotation. As a result, each GEO satellite appears fixed over a geographic area and in essence “blankets” that area with its signals, and an earth station antenna located in that area can communicate continuously with a particular satellite if it is pointed to, and has an unobstructed view of, that satellite’s orbital location. An individual satellite can be designed to communicate with major portions of the earth via large, geographically dispersed beams, to focus its coverage more specifically on particular markets or regions through regional or spot beams, or to use a portion of its total capacity for each type of coverage.

The non-geostationary orbit, or NGSO, includes satellites operating in LEO, with an altitude typically between 200 and 870 miles (325 to 1,400 kilometers) and satellites operating in Medium Earth Orbit, or MEO, that is between the LEO and GEO orbits. Unlike geosynchronous satellites that operate in a fixed orbital location above the equator, LEO and MEO satellites travel around the earth at high velocities requiring antennas on the ground to track their movement. LEO satellite systems have the potential to offer a number of advantages over GEO satellites to meet growing requirements for broadband services, both consumer and commercial, by providing increased data speeds and capacity, global coverage, and latency on par with or, in some circumstances, better than terrestrial services.

Our Competitive Strengths

Telesat continues to be at the forefront of the satellite services industry, leading with outstanding customer service and a culture of engineering excellence and technological innovation. Today, we have a leading GEO business defined by one of the largest satellite fleets in the world, occupying attractive orbital locations and offering high performing, mission critical services to hundreds of customers worldwide. The average expected remaining commercial life of our satellite fleet is approximately 6 years. Additionally, we currently have a fleet utilization rate of 85%, one of the

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highest rates in the industry. We are building upon this existing communications platform by developing our Telesat Lightspeed constellation with the aim of creating a transformative and industry-leading fiber-like broadband network from the sky for commercial and government users globally.

The following competitive strengths characterize our business today and provide a strong foundation for Telesat Lightspeed:

Leading Global Satellite Operator with 50+ Years of Heritage and a Blue Chip Customer Base

We are a leading global satellite operator with over 50 years of operating experience. Our GEO satellite fleet is comprised of 15 satellites and offers global satellite coverage with a concentration over the Americas. Through our deep commitment to customer service and focus on innovation and engineering excellence, we have developed strong and long-standing relationships with a diverse range of customers globally.

Industry-Leading Engineering Expertise Driving Continuous Innovation and Advancement

We believe we have an unrivalled track-record of innovation, “firsts,” and commercial success in the global satellite industry, guided by one of the most experienced management teams in the industry. Our deep technical expertise and commercial focus has enabled us to pioneer many of the industry’s most ground breaking innovations, including:

1962 Telstar 1, built by Telesat Canada’s predecessors at AT&T and Bell Laboratories, successfully delivered the first live intercontinental satellite TV transmission between Europe and the United States;

1972 Telesat Canada launched Anik A1, the world’s first commercial domestic communications satellite in geostationary orbit;

1978 Telesat Canada launched the first commercial Ku-band satellite on which was offered the first DTH television service, laying the groundwork for the global DTH industry;

1981 Telesat Canada co-located two satellites in a single orbital slot for the first time, now a widely-used industry practice;

1996 Telesat Canada was the first to provide internet access to Internet Service Providers (“ISPs”) over satellite;

2004 Telesat Canada launched Anik F2, the first satellite to successfully commercialize DTH consumer Ka-band broadband services;

2009 Telesat Canada launched Telstar 11N, the first satellite to provide Ku-band coverage of the Atlantic Ocean from the Arctic Circle to the Equator;

2013 Telesat Canada launched Anik G1, the first commercial satellite with substantial X-band coverage of the Pacific Ocean, including Hawaii, to serve the Canadian and other governments;

2015 Telesat Canada launched Telstar 12 VANTAGE, the first satellite combining high-throughput satellite (“HTS”) spot beams and conventional broad beams, giving customers the ability to maximize throughput, lower cost per bit and meet growing demand for bandwidth intensive applications;

2018 Telesat Canada launched its Phase 1 LEO satellite (“LEO 1”), the start of Telesat Lightspeed, leveraging Telesat Canada’s innovative, patented design, and provided the first high-speed broadband connectivity from LEO;

2019 Telesat Canada conducted the world’s first 5G backhaul demonstration over LEO satellite in partnership with Vodafone and the University of Surrey;

2020 Telesat Canada and the GoC finalize $600 million agreement to bridge Canada’s digital divide with Telesat’s Low Earth Orbit satellite constellation; and

2021 Telesat Lightspeed entered into a $109 million contract with the Government of Ontario (“GoO”) towards universal broadband; and

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2023 Telesat contracts MDA Ltd. as prime satellite manufacturer for its advanced Telesat Lightspeed LEO constellation. Telesat announced that it expects to receive funding from its Canadian federal and provincial government partners in the combined amount of up to approximately US$2 billion and that this funding, combined with Telesat’s own approximately US$1.6 billion equity contribution, as well as certain vendor financing, would provide the Telesat Lightspeed program with sufficient funds to launch global service, which will occur once the first 156 satellites are in orbit. The finalization of this funding is dependent on a number of conditions, including the execution of definitive agreements.

We believe our accumulated experience and expertise in the design, procurement, launch, operation and commercialization of satellites and satellite networks is unparalleled and will continue to drive our success into the future.

Portfolio of Strategic and Valuable Orbital Real Estate

Our GEO satellites occupy orbital locations that provide us with an advantageous position in the markets in which we operate due to the scarcity of available satellite spectrum. Access to these orbital locations, coupled with the high capital intensity of the satellite industry, creates barriers to entry in those markets. We are licensed by ISED to occupy a number of key orbital locations that are well-suited to serve the Americas and support our leading position in North America. Internationally, our satellites occupy advantageous orbital locations that enable broad pan-regional service with interconnectivity between regions, promoting both intra- and inter-regional services. We also have rights to additional spectrum, including at certain existing orbital locations.

We have decades of experience in obtaining and maintaining the licenses and approvals required to operate our existing global satellite and ground station network. We have secured a license from the GoC to launch and operate a LEO satellite constellation using ~4 GHz of Ka-band spectrum, for which Telesat has international spectrum rights in accordance with filings made through the International Telecommunication Union. Ka-band spectrum is particularly well suited for high performance global broadband networks because it allows wider bandwidth, high data and efficient frequency reuse for user-beam services, as well as the feeder-link beams required to connect the satellites to landing stations. As described in the “Regulation” section below, we have received some licenses and approvals for Telesat Lightspeed and are pursuing a market access plan in additional countries that are most important to our business plan on a global basis.

Uniquely Positioned to Revolutionize Global Broadband Connectivity with Telesat Lightspeed

We are uniquely positioned to revolutionize the provision of global broadband internet connectivity with Telesat Lightspeed, which we believe will be one of the most advanced constellations of LEO satellites and integrated terrestrial infrastructure ever conceived. Our Telesat Lightspeed architecture is designed to offer a powerful combination of capacity, speed, security, reach, resiliency and affordability, with low latency that is on par with the most advanced terrestrial networks. We have strong government support, including an anchor contract with the GoC that we believe will result in approximately $1.2 billion of revenue over 10 years, which includes $600 million from the GoC. The GoO has purchased a dedicated Telesat Lightspeed capacity pool to be made available at substantially reduced rates to Canadian Internet service providers, and mobile network operators, that we believe will result in over $200 million of

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revenue over a five-year term, which includes $109 million from the GoO. Given delays we experienced in finalizing the financing of Telesat Lightspeed, we will need to negotiate amendments to our agreements with the GoC and GoO to reflect a later in-service date requirement, which negotiations may not be successful.

We have an agreement-in-principle with Canadian federal and provincial government sources for up to an approximately US$2 billion of long-term funding.

Contracted Revenue Backlog and Disciplined Management Supports Strong Revenue Visibility

Because of the mission-critical nature of our services and long-term contractual agreements, we have significant revenue visibility. For the last three years we have had, on average, approximately 80% of each year’s total revenue already under contract at the beginning of the year. Our contracted revenue backlog of $1.3 billion for our GEO business as at December 31, 2023 represents a multiple of approximately 1.9 times revenue for the year ended December 31, 2023. 100% of our backlog is non-cancellable or cancellable on economically prohibitive terms, except in the event of a continued period of service interruption. Approximately 45% of our revenue is derived from North American DTH customers who signed long term (~15 years) contracts. Roughly half of our revenue is derived from providing vital connectivity services to companies that we have served for decades, including telecommunication companies, mobile network operators, users in the aeronautical and maritime markets, energy and natural resource companies, and governments. As demand for affordable, secure and reliable broadband connectivity continues to increase, we expect that demand for these services from these and similar customers will continue to grow.

We generate highly attractive operating margins. For the year ended December 31, 2023, we have generated Operating Income of $568.8 million and Adjusted EBITDA of $533.7 million, representing an Operating Income Margin of 80.8% and an Adjusted EBITDA margin of 75.8%1. Our strong historical cash flow conversion (as measured by Adjusted EBITDA minus Capital Expenditures) reflects our disciplined approach to capital investment and fleet expansion, with an emphasis on ensuring high customer utilization of our satellites.

Our Growth Strategy

We plan to grow our business and profitability by supporting our existing customers and services and by developing and deploying Telesat Lightspeed. Telesat Lightspeed is a highly advanced, global, enterprise-grade, integrated satellite and terrestrial network optimized to capture the growing demand for broadband connectivity in certain key market verticals around the world. Core to our growth strategy is leveraging our longstanding customer relationships, our deep technical, operating and regulatory expertise and our culture of outstanding customer service and continuous innovation. The principal elements of our growth strategy are the following:

Follow a Disciplined GEO Satellite Operating and Expansion Strategy

We will continue to focus on increasing the utilization of our existing GEO satellite capacity, maintaining our operating efficiency and, in a disciplined manner, using our strong cash flows to strengthen our business. We will continue to be disciplined in our satellite replacement and expansion program, seeking to secure high-quality, long-term customers to anchor any new or replacement geostationary satellites in advance of committing to the construction of such satellites. Many of our customer service contracts are multi-year in duration and, in the past, we have successfully contracted all or a significant portion of a satellite’s capacity prior to commencing construction.

Capture the Explosive Demand for Global Broadband Connectivity with Telesat Lightspeed

Telesat Lightspeed has been designed to provide fast, affordable, reliable and secure broadband connectivity everywhere on Earth, giving Telesat and our customers a significant competitive advantage in the markets we serve. The network design is optimized to serve enterprise and government users that require fiber-like connectivity beyond the reach of high capacity terrestrial networks. We believe our advanced constellation design, patented LEO

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1 Adjusted EBITDA and Adjusted EBITDA Margin are Non-IFRS measures. For the definition and a reconciliation of Non-IFRS measures, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Non-IFRS Measures”.

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architecture, strong government support and decades of deep commercial, technical, operational and regulatory experience put us in a strong position to capture the growing demand for affordable, high capacity broadband connectivity around the world.

Opportunistically Engage in M&A Activity to Enhance our Competitive Position and Shareholder Value

The satellite industry has, historically, undergone periods of consolidation, both horizontal and vertical.

A number of satellite operators have publicly discussed the benefit of, and potential for, consolidation among satellite operators. Our competitor ViaSat has acquired Inmarsat, a leading provider of global mobile satellite communications services, and Eutelsat has acquired OneWeb. We will be alert to, and will evaluate, merger and acquisition opportunities in a thoughtful and disciplined manner as they arise with the aim of enhancing our competitive position and shareholder value.

Our GEO Business and Our LEO Opportunity

Below, we describe in detail our existing GEO business and the compelling opportunity presented by our Telesat Lightspeed network.

Background and Overview of Our GEO Business

Satellite operators compete with terrestrial network operators (e.g., cable, DSL, fiber optic, cellular/wireless and microwave transmission) in the market for video, data and voice communication services. We believe that satellite services have several advantages over these competing communication platforms, including the following:

• Satellites are a relatively cost-effective and efficient means to deliver a signal (e.g., TV, radio) to hundreds of millions of locations in a large geographic area, in particular in remote areas;

• The capacity to provide extensive coverage over a large geographic region allowing for the addition of sites at a lower marginal cost. Unlike cable and fiber lines, satellites can readily provide broadcast and communication services over large areas and to remote locations where the population density may not be high enough to warrant the expense of building a terrestrial-based communications network;

• The ability to deploy communications quickly in locations where little or no infrastructure is available, for example in the case of natural disaster response; and

• The capability to bypass shared and congested terrestrial links, further enhancing network performance, resiliency and security.

Traditionally, satellite communications services have principally been delivered by GEO satellites, such as those in our fleet, which circle the earth from orbital locations approximately 22,300 miles (35,700 kilometers) above the equator. Each GEO satellite in essence “blankets” a fixed geographic area with its signals and can communicate continuously with an earth station antenna if it is pointed to, and has an unobstructed view of, that satellite’s orbital location. An individual satellite can be designed to cover large geographic areas, to focus its coverage more specifically on particular markets or regions, or to use a portion of its total capacity for each type of coverage.

This contrasts with NGSO satellites, which include LEO satellites with an altitude typically between 200 and 870 miles (325 to 1,400 kilometers) and satellites operating in MEO that stand between the LEO and GEO orbits. Unlike GEO satellites that operate in a fixed orbital location above the equator, LEO and MEO satellites continuously travel around the Earth at high velocities and, depending on their orbits, may cover higher latitude parts of the Earth that GEO satellites may not be able to reach.

Overview of Our GEO Satellite Business

Our GEO satellite fleet is comprised of 15 satellites and offers global coverage with a concentration over the Americas. We have a significant position in the North American satellite video distribution market. Our GEO satellite fleet and ground infrastructure provide a platform supporting (i) video distribution and DTH in North America with large telecommunications customers and significant contracted backlog, and (ii) connectivity satellite services for customers around the world for backhaul, corporate networks, maritime and aero services, and video distribution and contribution.

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We offer our suite of GEO satellite services to more than 400 customers worldwide, which include some of the world’s leading DTH service providers, ISPs, network service integrators, telecommunications carriers, corporations and government agencies. We have established long-term, collaborative relationships with our customers and have developed a reputation for innovation, reliability, and outstanding customer service.

We believe our global satellite fleet, access to desirable orbital locations and spectrum rights and strong relationships with our customers position us to maintain our industry leading position as a provider of GEO satellite services, generate significant cash flows, and capitalize on the growth drivers in the satellite industry and the markets we serve.

Our GEO Services

We earn the majority of our revenues by providing satellite-based services to customers who use these services for their own communications requirements or to provide video and data service solutions to customers further down the distribution chain. We also earn revenue by providing ground-based transmit and receive services, selling equipment, installing, managing and maintaining satellite networks and providing consulting services in the field of satellite communications.

We currently derive revenues from the following services:

• Broadcast: Our broadcast services business provided approximately 47% of our revenues for the year ended December 31, 2023. Our broadcast customers include North American DTH providers Bell TV, Shaw Direct, DISH Network, and leading telecommunications and media firms such as Bell Media. These services include:

• DTH: The two major DTH service providers in Canada (Bell TV and Shaw Direct which are estimated to have approximately 1.1 million subscribers) exclusively use Telesat satellites as a distribution platform for satellite-delivered television programming, audio and information channels directly to their customers’ homes. In addition, two of our satellites are used by DISH Network, which has about 6.47 million subscribers according to public filings, for DTH services in the U.S.

• Video distribution and contribution: Broadcasters, cable networks and DTH service providers use our satellites for the full-time transmission of television programming, distributing content around the globe. Additionally, we provide certain broadcasters and DTH service providers bundled, value-added services that include satellite capacity, digital encoding of video channels, and uplinking and downlinking services to and from our satellites and earth station facilities.

• Enterprise: Our enterprise services provided approximately 51% of our revenues for the year ended December 31, 2023. Our enterprise customers include Bell Canada, Hughes Network Systems, iForte, Marlink, Northwestel, Telespazio, Viasat, Vodafone and Xplore. These services include:

• Telecommunication carrier and integrator services: We provide satellite capacity and end-to-end services for data and voice transmission to telecommunications carriers and integrators located throughout the world. These services include space segment services and terrestrial facilities for enterprise connectivity, internet backhaul, cellular backhaul and services such as rural telephony to telecommunications carriers and network services integrators around the world.

• Maritime and aeronautical services: We provide satellite capacity to customers serving the maritime and aeronautical markets, bringing broadband communications services to commercial airplanes and vessels.

• Government services: We provide services to the U.S. government, including through government service integrators, and are a significant provider of satellite services to the Canadian government.

• Direct

-to-consumer

broadband services: We provide satellite capacity to Xplore in Canada, and to Hughes Network Services in South America, who each, in turn, use it to provide two-way broadband internet services directly to consumers.

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• VSAT services: We operate satellite and terrestrial networks that support enterprise and retail activities in Canada¸ including point-of-sale and other applications. These services include installation and maintenance of the end user terminal as well as the provision of satellite capacity and other network elements.

• Resource services: We provide communications services to geographically diverse locations, both on and off shore, for the oil and gas and mining industries.

• Satellite operator services: We provide satellite services to other satellite operators when they do not have adequate capacity to meet their customers’ needs. We also, on occasion, will relocate one of our end of life satellites to the orbital location of another satellite operator on a short-term basis so that they can preserve their spectrum rights at that location.

• Consulting and other: Our consulting and other category provided approximately 2% of our revenues for the year ended December 31, 2023. We have provided services to businesses and governments in more than 40 countries and on over 100 satellite systems. Our consulting customers have included Airbus, Brit Insurance, Lockheed Martin, MDA Geospatial Services, Mitsubishi Electric, The Defense Advanced Research Projects Agency (“DARPA”), Telkom Indonesia, Viasat, as well as many regional satellite operators around the world. Our consulting operations allow us to realize operating efficiencies by leveraging, in part, the same employees and facilities used to support our own satellite communication business.

The combination of our North American broadcast, enterprise and government services businesses, and our international business offers diversity in terms of both the customers, end markets and regions served as well as the services provided. For the year ended December 31, 2023, we derived revenues, based on the billing address of the customer, in the following geographic regions:

Geographical Breakdown of Revenues

	Years ended December 31,
($ millions)	2023		2022		2021
North America	$	569.6	$	620.5	$	623.3
Asia and Australia	$	50.7	$	45.1	$	38.3
Latin America and Caribbean	$	48.7	$	57.8	$	55.8
Europe, Middle East and Africa	$	35.3	$	35.8	$	40.8

Our Infrastructure

In-Orbit Satellite Fleet

Our GEO satellite fleet is comprised of 15 satellites offering global coverage with a concentration over the Americas. We also have one LEO satellite, LEO 3, in polar orbit.

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Owned in-orbit satellites as of December 31, 2023

	Orbital Location Regions Covered	Launch <br>Date	Manufacturer’s End-of-Service Life	End-of-Orbital Maneuver Life(1)	Model
Anik F1	109.2° WL North America	Nov 2020	2016	2024(2)	BSS702 (Boeing)
Anik F1R	107.3° WL North America	Sep 2005	2020	2026(2)	E3000 (EADS Astrium)
Anik F2	111.1° WL Canada, Continental United States	Jul 2004	2019	2027(2)(6)	BSS702 (Boeing)
Anik F4	111.1° WL Canada	May 2004	2019	2026	A2100 (Lockheed Martin)
Anik F3	118.7° WL Canada, Continental United States	Apr 2007	2022	2025	E3000 (EADS Astrium)
Anik G1	107.3° WL Canada South America	Apr 2013	2028	2039	SS/L 1300
Nimiq 2(3)	109.2° WL North America	Dec 2002	2015	2026(2)	A2100 AX (Lockheed Martin)
Nimiq 4	82° WL Canada	Sep 2008	2023	2027	E3000 (EADS Astrium)
Nimiq 5	72.7° WL Canada, Continental United States	Sep 2009	2024	2036	SS/L 1300
Nimiq 6	91.1° WL Canada	May 2012	2027	2046	SS/L 1300
Telstar 11N	37.55° WL North and Central America, Europe, Africa and the maritime Atlantic Ocean region	Feb 2009	2024	2027	SS/L 1300
Telstar 12 VANTAGE	15° WL Eastern United States, SE Canada, Europe, Russia, Middle East, South Africa, portions of South and Central America	Nov 2015	2030	2032	E3000 (Airbus)
Telstar 14R/Estrela do Sul 2	63° WL Brazil and portions of Latin America, North America, Atlantic Ocean	May 2011	2026	2026	SS/L 1300
Telstar 18 VANTAGE(4)	138° EL India, South East Asia, Indonesia/Malaysia, China, Australia/New Zealand, North Pacific and Hawaii	Sep 2018	2033	2040	SS/L 1300
Telstar 19 VANTAGE	63° WL Brazil and portions of Latin America, North America, Atlantic Ocean, Caribbean	Jul 2018	2033	2037	SS/L 1300
LEO 3	NGSO	July 2023	2028	N/A(5)	UTIAS SFL

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(1) Our current estimate of when each satellite will be decommissioned, taking account of anomalies and malfunctions the satellites have experienced to date and other factors such as remaining fuel levels, consumption rates and other available engineering data. These estimates are subject to change and it is possible that the actual orbital maneuver life of any of these satellites will be different than we currently anticipate. Further, it is anticipated that the payload capacity of each satellite may be reduced prior to the estimated End-of-Orbital Maneuver life.

(2) End-of-Orbital Maneuver life for these satellites has been extended through inclined orbit operations which reduces fuel consumption through the elimination of north-south station-keeping.

(3) Our Nimiq 2 satellite is primarily used to provide short-term services to other operators who use the satellite at their designated orbital locations to preserve their spectrum rights.

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(4) Telesat International Limited (“TIL”), a subsidiary of Telesat Canada, and APT have entered into agreements relating to the Telstar 18 VANTAGE satellite, which are accounted for as a joint operation, whereby TIL’s interest is 42.5%.

(5) LEO 3 has sufficient fuel to support collision avoidance maneuvers for several years and subsequent deorbit. End of life will be determined based on ongoing assessment of spacecraft health.

(6) Anik F2 was placed into inclined operations in December 2022. A C-band satellite acquired from a third party (renamed “Anik F4”) was collocated at the orbital location and commenced providing station-kept service in January 2023.

Rights to Other Satellites

In addition, we have rights to satellite capacity on other satellites, including the entire Ka-band Canadian payload, consisting of nine user beams, on ViaSat-1.

Satellite Control Center and Earth Station Facilities

Our primary Satellite Control Center (“SCC”) is located at our headquarters in Ottawa, Ontario. The SCC is the hub for our satellite-related activities. The facility is staffed 24 hours per day and currently operates 12 Telesat owned satellites: Anik F1, Anik F1R, Anik F2, Anik F3, Anik G1, Nimiq 2, Nimiq 4, Nimiq 5, Nimiq 6, Telstar 11N, Telstar 12 VANTAGE, and Telstar 18 VANTAGE. We also operate numerous other satellites for third parties from our SCC in Ottawa. We operate our Telstar 14R/Estrela do Sul 2 satellite and our Telstar 19 VANTAGE satellite from our SCC in Rio de Janeiro, Brazil. The Anik F4 and LEO 3 satellites are operated on our behalf by SES and UTIAS SFL respectively. Our headquarters is located at 160 Elgin Street, Ottawa where we lease approximately 75,900 rentable square feet. The lease expires on July 31, 2029, and we have two options to extend for an additional five years each.

The Allan Park earth station, located northwest of Toronto, Ontario on approximately 65 acres of owned land, houses a customer support center and a technical control center. This facility is the single point of contact for our customers internationally and is also the main earth station complex providing Telemetry, Tracking and Control services for the satellites that we operate. The Allan Park earth station also houses our back-up satellite control center for the Nimiq and Anik satellites. The back-up satellite control center for the Telstar satellites is located at the Mount Jackson earth station. We have the functional ability to restore satellite control services via the Allan Park and Mount Jackson back-up control centers if our primary SCCs became disabled.

In addition to the Ottawa headquarters and the Allan Park earth station, we operate a number of other earth stations, including the following:

Overview of Telesat Earth Stations (Other than the SCC and Allan Park)

Earth stations	Owned or leased property
Victoria, British Columbia, Canada	Leased
Fort McMurray, Alberta, Canada	Leased
Calgary, Alberta, Canada	Owned
Hague, Saskatchewan, Canada	Leased
Saskatoon, Saskatchewan, Canada	Leased
Winnipeg, Manitoba, Canada	Owned
Montreal, Quebec, Canada	Owned
Iqaluit, Nunavut, Canada	Leased
St. John’s, Newfoundland, Canada	Leased
Mount Jackson, Virginia, U.S.	Owned
Middleton, Virginia, U.S.	Leased
Belo Horizonte, Brazil	Owned
Kapolei, Hawaii, U.S.	Third party site
Aflenz, Austria	Third party site
Perth, Australia	Third party site
Jakarta, Indonesia	Third party site

In addition to these facilities, we lease facilities for administrative and sales offices in various locations throughout Canada and the U.S. as well as in Brazil, England and Singapore.

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GEO Business Model

The majority of our revenue comes from service agreements. These cover the provision of satellite capacity, ground services and/or end-to-end managed services. In our service agreements, a customer commits to purchase a specific type of capacity or service. Typically, our service agreements are for at least one year and are non-cancellable, except in the event of a continued period of service interruption.

Our sales efforts are organized by region. We sell our services worldwide primarily through a direct sales force located at our headquarters in Ottawa and in London, Singapore, Rio de Janeiro, Washington D.C. and Toronto.

Background and Overview of Telesat Lightspeed

A key growth opportunity is the continued development and deployment of Telesat Lightspeed. We believe that Telesat Lightspeed has the potential to revolutionize global broadband internet connectivity and allow Telesat to rapidly and profitably grow its business. For this reason, we have invested significant time and resources to develop this innovative constellation of LEO satellites, which we believe will be among the most capable and technologically advanced satellite-based enterprise grade networks in the world. The success of Telesat Lightspeed is expected to be driven by the compelling value proposition it represents in the market, as well as our deep familiarity with our customers, their markets, use cases and needs.

Overview of The Market Opportunity: Growing Demand for High-Capacity, Fiber-like Broadband Connectivity Everywhere

Global broadband demand is increasing exponentially as the world is becoming increasingly digital, a trend that was accelerated by the global COVID pandemic. Applications and programs that are critical to individuals, businesses and governments are built to run on the fast, low latency terrestrial networks that serve the majority of users in developed economies. Forecasted rates in IP-traffic are expected to grow from 160 exabytes per month in 2023 to 563 exabytes per month in 2029, a 23% compound annual growth rate, on a global basis.2

However, there is a major gap in access to global broadband connectivity, with more than three billion people who live outside of urban areas either poorly connected or not connected at all. These unserved and underserved areas include over one million mobile sites (where legacy 2G/3G equipment is installed, but cannot provide broadband data without affordable high capacity backhaul), 600,000 schools, hospitals and offices, 550,000 ships at sea and almost four billion aviation passengers each year.

Traditional Terrestrial and Satellite Solutions Cannot Meet This Growing Demand, but LEO Satellites Can

Expanding the availability of the digital world to unserved and underserved areas requires bringing to these areas the same type of broadband, fiber-quality connectivity that is available in well-connected areas.

It is, however, either prohibitively expensive to install fiber in these areas or simply physically impossible (e.g., to planes and ships).

Historically, the primary options for these markets have been traditional GEO and MEO satellites. While these satellites can provide coverage in most areas, because of the vast distances between the Earth’s surface and the orbital positions above the Earth occupied by GEO and MEO satellites, the user experience suffers due to high latency (the round-trip time delay between the data source and the data destination), which is prohibitive for certain consumer and enterprise broadband applications:

• Consumer applications: Content-heavy webpages and applications cannot load quickly, large documents cannot be uploaded and downloaded efficiently, encrypted applications such as Virtual Private Networks (remote work access tools) and encrypted websites can experience significant lags or fail altogether.

• Enterprise applications and real

-time

communications and controls: Highly latency-sensitive enterprise applications cannot operate on systems that have a meaningful delay in sending and receiving a signal. Advanced mobile networks, like 5G, cannot operate as intended over high latency backhaul.

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2 Ericsson Mobility Report November 2023

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LEO satellites are 35 times (or more) closer to the Earth than GEO satellites and 8 times (or more) closer than MEO satellites, thereby solving latency issues that exist with GEO and MEO satellites. In addition to offering low latency, however, any potential LEO solution must also be significantly flexible and technologically advanced to dynamically deliver high capacity connectivity where users require it and minimize the amount of capacity that is idled because it cannot effectively be put to use in the network at any given time. A next-generation satellite broadband network must meet other market requirements for commercial broadband services:

• High capacity: Capable of coping with high demand and network congestion. Since demand for connectivity tends to be concentrated, LEO networks must be able to dynamically concentrate very high amounts of capacity to high demand areas such as airports and seaports.

• Global coverage: Provide services everywhere, including to high latitude areas like the poles (a critical feature for large airlines, global shipping fleets and governments) as well as non-urban areas.

• Simple to use: Plug and play with existing infrastructure by having simple, standards-based interfaces to the terrestrial network and the Internet.

• Resilient: Mission-critical level of reliability of service. Online activities are now critical for the well-being of individuals, businesses and government users, increasing the emphasis on the reliability and resiliency of the communications network supporting them. A LEO satellite network is a distributed, multi-node network, making it more resilient to service outages.

• Affordable: Global broadband services provided over a LEO satellite network must be affordable, transforming the economics of the existing marketplace and expanding the addressable market.

As discussed further below, Telesat Lightspeed has been specifically designed and optimized to meet these requirements.

The Market Opportunity for Telesat Lightspeed in Key Vertical Markets

We estimate that the total addressable market, or TAM, for our GEO business will reach approximately US$15.6 billion by 2025.3 Telesat Lightspeed is expected to significantly increase our TAM. The estimated TAM for LEO is approximately US$425 billion in 2025, which we project will nearly double in light of the demand drivers that exist today (e.g., 4G/LTE backhaul in terrestrial vertical or passenger connectivity in aviation vertical), and could potentially triple4, by 2030s with evolving, more nascent applications with high bandwidth potential (e.g., 5G, IoT, backhaul, and operational data transport in aviation).

The Telesat Lightspeed design has been specifically optimized to serve vertical markets that require fiber-like connectivity beyond the reach of terrestrial networks. Our target markets span four verticals: (i) enterprise and telecom, (ii) aviation, (iii) maritime and (iv) government. These target markets require all of the features of Telesat Lightspeed, but each also have their own unique requirements, making certain features of Telesat Lightspeed particularly compelling to each of them.

Enterprise and Telecom

We estimate that the enterprise and telecom market opportunity that can be addressed by LEO will be approximately US$415 billion in 2025 and will grow at 9% annually until 2027 to reach approximately US$495 billion. Of the US$415 billion, we estimate that about US$235 billion is the direct-to-consumer market opportunity and about US$180 billion is the enterprise market opportunity. Our estimates are derived from information on the enterprise and telecom data market obtained from a variety of sources, including OECD Broadband statistics, World Bank Country Indicators, Landscan (with respect to population distribution) and management’s analysis and estimates as to the portion of the enterprise and telecom data market that Telesat Lightspeed could address. Enterprise applications include fixed wireless and mobile backhaul, remote enterprise, and health and education. Telesat Lightspeed will initially focus on addressing the enterprise market.

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3 NSR Global Satellite Capacity Supply and Demand Study, 19th Edition.

4 According to Cisco Visual Networking Index, 2017-2022, data demand triples approximately every 5 years. Accordingly, over a 10-12 year horizon (2023 to early 2030s), data demand is expected to grow by approximately 10 times. However, since data pricing generally reduces over time, we estimate overall market value should double or triple over the stated horizon.

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This market is underpinned by the approximately four billion people who are digitally underserved or unconnected. Key demand areas are backhaul from mobile wireless sites, fixed wireless backhaul for remote communities, remote enterprise and emergency services, and broadband for institutions (schools, hospitals, etc.). In many of these areas, there is simply no economical fixed or terrestrial wireless (e.g., microwave) backhaul solution for delivery of high-speed broadband connectivity. There also tends to be no quality access in remote areas for enterprise cloud applications, meaning that schools, hospitals and other public institutions in those areas are unable to take advantage of broadband applications and cloud-based services.

Telesat Lightspeed is designed to provide an optimal, low-cost solution that can become the primary connectivity solution in remote areas and a secondary connectivity solution in urban areas. The Telesat Lightspeed “plug & play” versatility is expected to seamlessly integrate with terrestrial networks, vastly simplifying operations as compared to traditional satellite networks. The low latency of our network will enable customers to seamlessly transport encrypted traffic between terrestrial and satellite networks at high data rates, something that is not possible with traditional GEO satellite networks. The network is also expected to provide high throughput for large trunking links in Northern Canada and for island nations.

Importantly, given our strong reputation and existing customer relationships providing backhaul solutions for telecommunications companies and Mobile Network Operators (“MNOs”) in underserved or unconnected areas, as well as the high growth potential of this market, we are not focused on direct-to-consumer services at this time. It is possible, however, that evolution in antenna technology and other market developments may cause Telesat to offer direct-to-consumer services in the future. Satellites allow telecom operators to expand the reach of their fixed and mobile networks to locations not served, or underserved, by terrestrial networks by connecting these off-network locations to their main networks.

Growing demand for fixed and mobile data, accelerated by the global rollout of 5G services and the universal service coverage requirements of many MNO licenses, is anticipated to drive growth for satellite backhaul services.

Other demand drivers in the enterprise and telecom market include:

• Corporate networks: As economic growth accelerates in parts of the world with poor terrestrial infrastructure, corporate enterprises expanding their activities in these regions will drive demand for increased satellite capacity.

• Government-sponsored universal connectivity programs: Universal connectivity projects (government supported initiatives to bring broadband services to rural and remote communities and those with limited terrestrial infrastructure) are growing in both developed and developing nations. Governments are increasingly focused not just on basic connectivity but on enabling high quality connectivity to rural areas, similar to that in urban areas. For example, the Canadian Government’s universal broadband program envisions connecting every Canadian household to a 50x10 Mbps service, far superior to that available today.

Additional government programs supporting better connectivity to businesses and institutions in remote areas (e.g., agriculture, schools, and hospitals) are also on the rise. Telesat may provide backhaul services to funding recipients of programs such as the following:

• The U.S. has created a US$20 billion universal broadband program, the Rural Digital Opportunity Fund (“RDOF”), to subsidize service providers to connect underserved areas. The RDOF program incentivizes low latency (sub-100 milliseconds) services that are not deliverable by traditional GEO satellites, but are deliverable by LEO satellites. Further, the U.S. has created a “5G Fund for Rural America” of US$9 billion to bring 5G mobile broadband service to rural areas that would be unlikely to otherwise see deployment of 5G broadband service.

• Broadband Europe promotes the European Commission’s vision and policy actions to turn Europe into a Gigabit Society by 2025, backed by various initiatives in spending support.

• As universal broadband connectivity has become a key public policy objective in many countries around the world, there are similar universal broadband support initiatives in these countries, including India, Brazil, Australia, Nigeria and Indonesia.

Telesat Lightspeed, which is expected to provide affordable, fiber-like connectivity and backhaul to remote areas, stands to benefit from the expansion of networks and growing demand for high-speed, low latency connectivity resulting from such government-funded digital inclusion programs.

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Aviation

The aviation market opportunity addressable by LEO is expected to grow at 7% annually through 2025 to reach approximately US$3 billion, according to NSR.5 The market opportunity includes delivering connectivity services to commercial aircraft and business jets. Airlines are looking to provide value added and differentiated services to customers, such as free in-flight Wi-Fi and on-demand video streaming.

However, there are currently no high-quality, low-cost, “gate-to-gate” in-flight connectivity (“IFC”) solutions in the marketplace. IFC service providers are facing network capacity constraints in the U.S., especially around demand hotspots such as large airports, and will not have the necessary capacity to support the expected surge in demand should airlines start adopting free in-flight Wi-Fi.

As broadband connectivity has become increasingly important to businesses and individuals, the need to stay connected has spread to locations that cannot readily access terrestrial networks. In aeronautical markets, satellite broadband for passenger and crew communications has become a significant driver of demand and a competitive differentiator as airlines and business jet operators around the world compete for passengers and staff. In addition, aircraft manufacturers and key parts suppliers (e.g., aircraft engine manufacturers) seek improved broadband connectivity to better monitor aircraft health, weather conditions and to optimize airline operations. For example, better and real-time data from the aircraft to the ground will help optimize flight paths and improve maintenance planning, all leading to lower operating cost for the airlines.

The flexible architecture of Telesat Lightspeed is designed to deliver high throughput services to high demand air traffic corridors at speeds and costs that will allow airlines to unlock the benefits of IFC. We plan to offer full global coverage with the flexibility for the airlines and their IFC service providers to dynamically allocate capacity to any plane globally, allowing them to efficiently manage their capacity pools. Telesat Lightspeed is planned as a fully integrated satellite and ground segment network, relieving IFC service providers of the burden and cost of managing their own global hub infrastructure.

Maritime

The maritime market opportunity that can be addressed by LEO satellite constellations is expected to grow at 10% annually through 2025 to reach about US$6 billion, according to NSR.6 This market includes connectivity to merchant vessels, oil & gas sites, yachts and cruise ships.

Currently, GEO satellite operators provide maritime connectivity networks, but these systems suffer from low capacity, high latency and high cost and fail to deliver the connectivity experience desired by passengers and crew members at sea. Cruise lines compete with terrestrial holiday options and greatly benefit from the ability to deliver an at-home-type connectivity experience to customers at sea. We believe Telesat Lightspeed will be uniquely positioned to deliver high throughput and low latency to cruise ships anywhere in the world, ensuring a compelling connectivity experience.

Similarly, yacht owners want to enjoy the same high-quality broadband experience that they have in their homes and offices. For the merchant shipping lines and large oil and gas offshore platform operators, quality and fully global connectivity are a key “ask” of the crew and influences the ability to attract and retain employees. Real-time ship-to-shore connectivity also enables important operational efficiencies (e.g., optimal sea routes reduce vessel fuel costs).

Similar to aviation services, the flexible architecture of Telesat Lightspeed will deliver high throughput services to high demand ports and full global coverage with the flexibility to allocate capacity to any maritime vessel globally, meaning that commercial and passenger fleets alike can ensure consistent fiber-like connectivity throughout the duration of their journeys.

Another growth driver for satellite services is expected to come from increased demand in the resource sector, largely driven by oil and gas exploration, the level of which has been driven principally by global economic growth. In addition, the current and increasing focus on safety concerns in the resource sector is leading to the implementation of diverse, redundant communications for monitoring and control of resource infrastructure (e.g., automated rigs and pipelines), including video, which may drive demand for low latency satellite services.

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5 NSR Aeronautical Satcom Markets, 5th Edition.

6 NSR Maritime Satcom Markets, 4th Edition.

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Government

We estimate the government market opportunity addressable by Telesat Lightspeed will be approximately US$1.5 billion in 2025 and will grow at 30% annually until 2027 to reach approximately US$2.6 billion.7 Telesat will focus on the government demand addressed by commercial satellite operators. Key applications initially include connectivity to government aircrafts, naval vessels and remote sites.

The U.S. government is the single largest user of commercial satellite communications and most of this use relates to the DoD operations. The defense segment is expected to drive increased global requirements for commercial satellite communications. Commercial satellites support secure communications, surveillance, reconnaissance, mobile communications, including support for unmanned aerial vehicles, logistics, troop welfare and a host of other services. The benefits of LEO constellations are being demonstrated in Ukraine following the Russian invasion where SpaceX’s Starlink has been critical in connecting the Ukrainian government, military, NGOs and civilians.

Government space architectures are expected in the future to move to multi-orbit “proliferated” constellations, particularly those based on LEO. As more nations demonstrate anti-satellite systems and communications jamming capability, governments are expected to seek LEO constellations made up of hundreds of advanced, interconnected satellites in an inherently more distributed, resilient network than a network comprised of a handful of high-value GEO satellites. LEO constellations also offer real-time low latency connectivity, and global coverage (including the poles). Global low latency communications are a key goal for the unmanned, remotely controlled, sensor platforms, which are vital to government environmental observation, meteorology, and defense. The DoD has made the development of multi-orbit, “hybrid” commercial/government constellations a priority for the new U.S. Space Force. Various DoD agencies have multi-million dollar LEO networks programs involving commercial industry underway, including: DARPA, the Space Development Agency, the Air Force Research Lab and the U.S. Space & Missile Systems Center. Telesat has direct or indirect LEO development contracts with each of these entities.

Another application in the government vertical market is for “space relay” services. Simply described, government-owned spacecraft could transmit data they collect directly to Telesat Lightspeed satellites in space through optical inter-satellite links, using Telesat Lightspeed as a communications relay network to route such data quickly and securely anywhere on Earth. We anticipate that the U.S. and other governments may launch their own satellites that interface with the Telesat Lightspeed network in that manner. Such a “space relay” service would simplify the design and lower the cost of government spacecraft and enable a more rapid technology refresh cycle than is currently the case, a capability that will be particularly attractive for national security applications in a rapidly changing world with budgetary constraints.

Additional Drivers of Demand Across Verticals and Markets for LEO Services

In addition to the factors driving the projected TAM growth in the key verticals described above, we believe the following trends can be expected to drive satellite services growth in the coming decade:

• Internet of Things: A vast number of physical objects (e.g., factories, appliances, machinery, electric grids and other infrastructure) now have the capability to monitor their environment, report status, receive instructions, and take action based on information they receive. This is all part of the Internet of Things, or IoT, that already comprises billions of devices in use worldwide and which is forecasted to grow at an approximately 20% average yearly rate until 2025. Reliable communications are essential for IoT to work and, while most IoT connections will likely be by terrestrial wireless, the growth in the number of connected devices is expected to drive increased demand for satellite services.

• Emerging industries: As developments in technologies like artificial intelligence and automated services progress, future applications such as autonomous driving and the connected car will require more than one communication link to ensure fully redundant connectivity at all times. Telesat Lightspeed is designed to support these developing technologies in an economically feasible manner as they evolve and come to increasingly rely on secure, reliable, low latency communications networks.

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7 International Defense Budgets, US Department of Defense Budgets, Management’s analysis and estimates.

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Overview of Telesat Lightspeed

We have been developing Telesat Lightspeed with industry-leading partners in order to optimize and de-risk its performance. As discussed in greater detail below, the Telesat Lightspeed design has been optimized to serve the fast-growing broadband connectivity requirements of fixed and mobile network operators, aeronautical and maritime users, enterprise customers and governments.

Telesat Lightspeed will combine state-of-the-art interconnected LEO satellites coupled with a sophisticated and integrated terrestrial infrastructure to create a fiber-like broadband network from the sky for commercial and government users worldwide. Our fleet will have a combination of satellites operating in a mix of orbits designed to optimize coverage and capacity, providing full global coverage while concentrating capacity over geographic regions of highest demand. Additional satellites and ground facilities can be added to the network over time to meet increased user demand as and when required.

In January 2018, our first LEO satellite, LEO 1, was successfully launched into orbit. The LEO 1 satellite has demonstrated certain key features of the Telesat Lightspeed system design, specifically the capability of the satellite and customer terminals to deliver a low latency broadband experience. In July 2023, we launched the LEO 3 satellite to continue the demonstrations. We also installed ground infrastructure at our teleport in Allan Park in Canada and Mt. Jackson in the United States to support testing with a variety of existing and prospective customers and potential suppliers of the Telesat Lightspeed system hardware who have been participating in trials since the second half of 2018. We have received positive feedback from customers.

Revenue commitments for Telesat Lightspeed were approximately $739 million as at December 31, 2023. Included in these commitments are an agreement with the GoC to bring affordable, high-speed internet connectivity across rural, underserved areas of Canada. Under the terms of our agreement, Telesat would receive revenue of $600 million from the GoC over a ten-year period commencing when the Telesat Lightspeed network begins commercial service, which will enable internet and mobility service providers to acquire Telesat Lightspeed capacity at substantially reduced rates to bring universal broadband connectivity to rural, Northern and Indigenous communities across Canada. The partnership is expected to generate $1.2 billion in revenue for Telesat over ten years, which includes the $600 million from the GoC. In addition, we have partnered with the GoO to bridge the digital divide pursuant to which Ontario has purchased, over a five-year term, a $109 million dedicated Telesat Lightspeed capacity pool which will be made available at substantially reduced rates to Canadian Internet service providers, including Indigenous owned and operated ISPs, as well as mobile network operators, to expand high-speed Internet and LTE/5G networks to Ontario’s unserved and underserved communities. The partnership is expected to generate over $200 million in revenue for Telesat over five years, which includes the $109 million from the GoO.

We continue to take a number of steps to continue to progress the Telesat Lightspeed business plan, including advancing our arrangements with launch providers, ground systems operators, and antenna manufacturers (to advance the development of economical and high efficiency antenna systems).

We anticipate diverse sources of financing, including (subject to compliance with our borrowing covenants) our current cash-on-hand, expected cash flows of our GEO business, future equity and equity-like issuances, and future borrowings.

On August 11, 2023 Telesat announced that it selected MDA Ltd. as prime satellite manufacturer for its advanced Telesat Lightspeed LEO constellation. Telesat also announced that it expects to receive funding from its Canadian federal and provincial government partners in the combined amount of up to approximately US$2 billion and that this funding, combined with Telesat’s own approximately US$1.6 billion equity contribution, as well as certain vendor financing, would provide the Telesat Lightspeed program with sufficient funds to launch global service, which will occur once the first 156 satellites are in orbit. The finalization of the Canadian federal and provincial funding is dependent on a number of conditions, including the execution of definitive agreements.

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The GoC will also contribute up to $85 million to Telesat through the GoC’s Strategic Innovation Fund (“SIF”).

There are numerous risks and uncertainties associated with our planned Lightspeed constellation. See “Risk Factors — Risks Relating to Telesat’s Lightspeed Constellation.”

Telesat Lightspeed Infrastructure

Satellites

Telesat Lightspeed was designed to optimally serve the key market verticals on which we are focused. It will allow Telesat to provide high-performing and cost-effective broadband services that will allow Telesat customers, serving both traditional and new satellite markets, to improve their competitiveness and expand their businesses. Telesat Lightspeed satellites incorporate leading-edge technologies and features, including:

• Advanced phased array antennas instantly match capacity to demand: The antennas on each satellite are combined with advanced, digital beam forming technology that can create hundreds of thousands of logical beams and dynamically focus multiple Gbps of capacity into demand hot spots like remote communities, large airports or major seaports;

• Interlinked satellite mesh network in space for high resilience and new applications: Each satellite will have high capacity optical links that combine to create a highly resilient, flexible and secure space-based network, moving data across the network and around the world at the speed of light;

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• Data processing in space provides most efficient traffic routing: Full digital modulation and demodulation occurs on the satellite, coupled with a revolutionary end-to-end constellation network operating system, improves link performance and gives customers a high degree of flexibility for routing traffic across the globe, eliminating gateway hops for fast, secure, end-to-end delivery of data; and

• Mix of orbits maximize network efficiency: Telesat Lightspeed satellites fly in an innovative mix of orbits designed to optimize coverage and capacity, with true pole-to-pole global coverage.

Ground-Based Infrastructure

The ground-based infrastructure of Telesat Lightspeed will consist of the landing stations (“Landing Stations”) and terrestrial network (“Terrestrial Network”) segments. Telesat Lightspeed is designed to make it easy for customers to connect to the network and communicate through it. Metro Ethernet Forum standards-compliant services are expected to further simplify the integration of Telesat Lightspeed into customer provisioning, operations and billing systems.

• Landing Stations: We plan to deploy widely distributed Landing Stations around the world to provide connectivity to Telesat Lightspeed. The Landing Stations provide the forward and return feeder links that connect the satellites to our ground system.

• Terrestrial Network: The Terrestrial Network consists of Points of Presence (“PoPs”) and the global fiber network that interconnects all elements of the network, including the Landing Stations, PoPs and data centers. PoPs will host customer facing network interfaces and will relay customer traffic to Landing Stations. One or more Landing Stations may connect to a regional PoP.

Telesat Lightspeed Performance Features

Telesat Lightspeed will provide critical features and functionality that will make it a highly compelling value proposition in the market verticals it has been optimized to serve, including:

• High throughput: Individual links will be at speeds in the gigabits per second and Telesat Lightspeed will have multiple terabits per second of total usable capacity;

• Low latency: Data will travel from the customer location to the internet (or the customer’s network) roughly 20 times faster than the latency that GEO satellites can provide;

• Low cost: With its highly innovative design, Telesat Lightspeed will have a cost advantage over many other satellite broadband solutions, enhancing its competitiveness and expanding the addressable market for satellite-delivered connectivity solutions;

• Focused and flexible capacity: The network will be able to dynamically allocate high capacity where and when customers require it, and will be able to reconfigure that capacity distribution as customer demand changes and evolves. Telesat Lightspeed also supports mesh connectivity enabling efficient remote to remote communications without having to transit the landing station;

• True global coverage: Telesat Lightspeed will provide coverage of the Earth’s entire surface, from pole to pole, fulfilling the needs of governments and mobility markets, such as aviation and maritime for global network coverage and providing a uniform connectivity experience;

• Interoperability with terrestrial networks: Customers want to connect to a satellite network as seamlessly as they do to terrestrial fiber networks today. Telesat Lightspeed leverages MEF 3.0 industry- wide network interface standards which enables simple, seamless integration with customers’ terrestrial networks, without the need to integrate proprietary hardware or software. Through MEF 3.0 underlay connectivity service standards, customers can easily understand the capabilities provided by Telesat Lightspeed and how these software-defined digital services can be procured and integrated into their networks; and

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• High level security and resiliency: With a constellation of interconnected satellites in a mix of orbits designed to optimize coverage and capacity and with multiple beams on each satellite, combined with the ability to dynamically reshape beam patterns on the Earth, we believe Telesat Lightspeed will provide a high level of resiliency and protection against interference never before available in satellite communications. In addition, industry-standard encryption will protect the network control functions, providing a high-level of security.

Since January 2018, we have used the LEO 1 satellite to demonstrate key features of our LEO system design, specifically the capability of the satellite and customer terminals to deliver a low latency broadband experience. LEO 1 Satellite has completed its mission and since July 2023 is replaced with LEO 3 satellite to continue the mission. We have conducted successful demonstrations in each of the key vertical markets we are targeting.

• Enterprise and Telecom: In partnership with Vodafone and the University of Surrey, we demonstrated that LEO satellites can provide effective backhaul transport for mobile network operators, including advanced backhaul solutions for 5G, based on round trip latency of 18-40 milliseconds during testing, among the lowest ever for a satellite broadband connection. Additional commercial LEO tests have been conducted with Telefonica, Optus, Motorola Solutions and PLDT. Microsoft Azure used the LEO 1 satellite to test throughput, latency and jitter, and also successfully demonstrated application functionality such as Office 365, Teams conferencing, file transfers to OneDrive, streaming videos and playing cloud hosted games on Xbox Cloud.

• Aviation: We have successfully demonstrated Telesat Lightspeed network’s IFC service capabilities via our LEO satellite with Honeywell and Anuvu.

• Maritime: We have successfully demonstrated Telesat Lightspeed network’s fit for maritime satellite communications services via our LEO 1 satellite with NSSL Global and OmniAccess, leaders in maritime connectivity solutions.

• Government: Telesat Lightspeed is particularly attractive to governments because of its resilient distributed nature, low latency, and truly global service.

In 2018, we were awarded a contract by DARPA to demonstrate capabilities of Telesat Lightspeed with DARPA’s experimental “Blackjack” constellation. In October 2020, DARPA awarded us a contract for the development and in-orbit demonstration of commercial spacecraft buses in a LEO constellation network with robust low latency communications features. As part of this follow-on contract, we have delivered two spacecraft buses to DARPA for a “risk reduction” flight to test OISL communications with government payloads in orbit and to demonstrate OISL interoperability with different hardware. In July 2022, Telesat was one of the recipients of the DARPA Space-Based Adaptive Communications Node (Space-BACN) contract to demonstrate the architecture of inter-connecting commercial LEO constellations and their optical inter-satellite link enabled mesh networks with heterogeneous U.S. government networks.

We also have contracts in place with prime contractors L3 Harris and General Dynamics Mission Systems for demonstrations and studies with Air Force Research Labs and NASA. In October 2020, Telesat U.S. Services was selected to become part of the Lockheed Martin team, which was recently awarded the Space Transport Layer Tranche 0 contract by the U.S. Space Development Agency.

Taken together, these developing relationships and contract awards demonstrate that the U.S. government is investing significant resources to bring about its “pivot” from GEO- to LEO-based satellite systems and its demonstrated interest in Telesat Lightspeed as a commercial satellite solutions provider.

The Competitive Landscape for Our Services

We compete against other global, regional and national satellite operators and with providers of terrestrial-based communications services.

Telesat is a leading global satellite operator. Other scaled, global satellite operators include Intelsat S.A. (“Intelsat”), SES S.A. (“SES”), Eutelsat S.A. (“Eutelsat”), Viasat, and SpaceX. We also compete against a number of nationally or regionally focused satellite operators around the world including Hughes. Telesat competes with these operators based primarily on the quality of our services, location of our orbital slots, performance characteristics of our satellites, price, and overall client needs.

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SpaceX and Eutelsat (OneWeb) both have LEO satellite systems that are now in service, and they continue to add satellites and capacity. There are a number of other LEO satellite systems that have been announced, including Amazon Kuiper and Rivada. We believe that the innovative architecture and advanced technology of Telesat Lightspeed will allow us to compete effectively against any of the other current and proposed systems.

We believe the combination of the following attributes positions us favorably to commercialize Telesat Lightspeed successfully, notwithstanding competitors in the LEO marketplace:

• Enterprise

-class

system: Telesat Lightspeed is focused on enterprise solutions and optimized for that purpose. Our constellation design, features and functionality will be a highly compelling satellite-based enterprise class network in the world. • Vast technical expertise, experience and relationships: As a trusted satellite operator with a highly experienced management team, we have longstanding relationships at the most important levels of the industry (e.g., customers, suppliers and regulators), and an established eco-system of partners to design a technologically-advanced and economical ground infrastructure.

• Existing, engaged customer base: We are known and trusted by key customers and have a deep understanding of their requirements. Over 400 telecommunications, enterprise, and government customers today rely on Telesat to help plan their future mission critical infrastructure needs.

• Global regulatory experience: Regulatory compliance is a critical aspect of operating and commercializing a satellite network. Obtaining rights to use spectrum and to gain access to provide service in countries around the world is a complex process. National governments have viewed space, and access to their markets from space, as a critical asset and insist on compliance with their regulations. The framework for NGSO spectrum rights, both at an individual country level and internationally at the ITU, is evolving, and it is critical to be an active participant in, and have deep knowledge of, these processes. Telesat has extensive experience in all of these areas, as well as credibility with regulators and other industry participants. For further regulatory detail, see “— Regulation.”

• Strong government support: Telesat Lightspeed has received strong support in Canada at the federal and provincial levels as evidenced by the capacity agreements executed with the GoC and GoO to bridge the digital divide and the planned investments of up to approximately US$2 billion.

Employees

As of December 31, 2023, we and our subsidiaries had approximately 490 permanent full and part-time employees. Approximately 2.7% of our employees are subject to collective bargaining agreements. Our employee body is primarily comprised of professional engineering, sales and marketing staff, administrative staff and skilled technical workers. We consider our employee relations to be strong.

Intellectual Property

Our success depends in part on our ability to obtain, maintain, protect, and enforce our intellectual property rights. We rely on a combination of patent, trademark, trade secret, copyright and other intellectual property rights and measures to protect the services and technology that we consider important to our business. We also rely on know-how, trade secrets and continuing technological innovation to develop and maintain our competitive position.

Our policy is to seek to protect our proprietary position by, among other methods, pursuing and obtaining patent protection in Canada and the United States and in jurisdictions outside of Canada and the United States related to our technology, inventions, improvements and services that are important to the development and implementation of our business. As of December 31, 2023, we owned 54 issued patents, five of which are in the United States. These patents expire between 2025 and 2039. We also have several pending Canadian, U.S., and international patent applications.

The term of individual patents depends upon the legal term of the patents in the countries in which they are obtained. Generally, in the United States, issued patents are granted a term of 20 years from the earliest claimed non-provisional or Patent Cooperation Treaty filing date. In certain instances, a patent term can be adjusted to recapture a portion of delay by the U.S. Patent and Trademark Office, or the USPTO, in examining the patent application (patent term adjustment, or PTA). Additionally, a patent term may be shortened if a patent is terminally disclaimed over an

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earlier filed patent. However, the life of the patent, and the protection it affords, is limited. In addition, we cannot provide any assurance that any patents will be issued from our pending or future applications or that any issued patents will adequately protect our current and future services. We also cannot predict the breadth of claims that may be allowed or enforced in our owned or in-licensed patents or whether such claims, if issued, will cover our services, provide sufficient protection from competitors or otherwise provide any competitive advantage. Any issued patents that we may own or in-license in the future may be challenged, invalidated, narrowed, held unenforceable, infringed or circumvented.

There can be no assurance that infringement of existing third party patents has not occurred or will not occur. Additionally, because the patent application process is confidential, there can be no assurance that third parties, including competitors, do not have patents pending that could result in issued patents which we may infringe. In such event, we may be restricted from continuing the infringing activities, which could adversely affect our business, or we may be required to obtain a license from a patent holder and pay royalties, which would increase our cost of doing business.

We believe that we have certain know-how and trade secrets relating to our technology and current and future services. We rely on trade secrets to protect certain aspects of our technology related to our current and future services. However, trade secrets and know-how can be difficult to protect. We seek to protect our trade secrets and know-how, in part, by entering into confidentiality agreements with our employees, consultants, scientific advisors, service providers, and contractors but these agreements may not provide meaningful protection, and we cannot guarantee that we have executed such agreements with all applicable counterparties. These agreements may also be breached, and we may not have an adequate remedy for any such breach. We also seek to preserve the integrity and confidentiality of our data and trade secrets by maintaining physical security of our premises and physical and electronic security of our information technology systems. Although we take steps to protect our trade secrets and know-how, third parties may independently develop or otherwise gain access to our trade secrets and know-how.

For more information, please see “Risk Factors — Risks Relating to Intellectual Property”.

Research & Development

Our research and development expenditures are incurred for the studies associated with advanced satellite system designs, and experimentation and development of space, satellite and ground communications services. This includes the planned development of Telesat Lightspeed.

Regulation

We are subject to regulation by government authorities in Canada, the U.S. and other countries in which we operate and are subject to the frequency coordination process of the ITU.

Canadian Regulatory Environment

Telesat Divestiture Act

Telesat was originally established by the GoC in 1969 under the Telesat Canada Act.

As part of the Canadian government’s divestiture of its shares in Telesat, pursuant to the Telesat Reorganization and Divestiture Act (1991) (“Telesat Divestiture Act”), Telesat was continued on March 27, 1992 as a business corporation under the CBCA, the Telesat Canada Act was repealed and the Canadian government sold its shares in Telesat. The Telesat Divestiture Act provides that no legislation relating to the solvency or winding-up of a corporation applies to Telesat and that its affairs cannot be wound up unless authorized by an Act of Parliament. For further detail, see “Risk Factors — Risks Relating to the Business of Telesat.” In addition, Telesat and its shareholders and directors cannot apply for Telesat’s continuation in another jurisdiction or dissolution unless authorized by an Act of Parliament.

Telecommunications Act

Telesat is a Canadian carrier under the Canadian Telecommunications Act (“Telecom Act”). The Telecom Act authorizes the Canadian Radio-Television and Telecommunications Commission (“CRTC”) to regulate various aspects of the provision of telecommunications services by us and other telecommunications service providers. Telesat is

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currently not subject to detailed rate regulation, however the CRTC has retained its powers under the Telecom Act to impose price regulation or other regulatory measures on Telesat in the future, as necessary. In addition, Section 28(2) of the Telecom Act provides that the CRTC may allocate satellite capacity to particular broadcasting undertakings if it is satisfied that the allocation will further the implementation of the broadcasting policy for Canada.

Radiocommunication Act

Our operations are subject to regulation and licensing by ISED pursuant to the Canadian Radiocommunication Act. ISED has the authority to issue spectrum and earth station licenses and establish policies and standards related to the radio frequencies upon which our satellites and earth stations depend. The Minister responsible for ISED has broad discretion in exercising this authority to issue licenses, fix and amend conditions of licenses, and to suspend or even revoke them. Some of the spectrum licenses under which we operate the Anik and Nimiq satellites require us to comply with research and development and other industrial and public benefit commitments, to pay annual spectrum license fees and to provide pan Canadian satellite coverage.

FSS and BSS licenses are awarded to qualified applicants on a first-come, first-served basis. The term of spectrum licenses is 20 years, with a high expectation of renewal. ISED may, however, issue licenses with a shorter term. Spectrum licenses include standard conditions of license, including milestones for construction, launch and deployment of satellite(s).

ISED is in the process of reallocating a portion of the C-band frequencies to terrestrial mobile 5G. As a result, Telesat is required to vacate a portion of the C-band, other than in satellite dependent areas, by March 31, 2025.

The Canadian Government opened Canadian satellite markets to foreign satellite operators as part of its 1998 WTO commitments to liberalize trade in basic telecommunications services, with the exception of DTH television services provided through FSS or DBS facilities. In September 2005, the Canadian Government revised its satellite-use policy to permit the use of foreign-licensed satellites for digital audio radio services in Canada.

Contribution Collection

Since November 2000, pursuant to the CRTC’s Decision CRTC 2000-745, telecommunications service providers that exceed a Canadian telecom revenue threshold are required to pay contribution charges, which are fees paid into a central fund used to support the provision of video relay service, and to subsidize the cost of providing cell phone and broadband service in rural, remote and underserved and high-cost serving areas. The charges payable by a telecom service provider are calculated as a percentage of its Canadian telecommunications service revenues, minus certain deductions (e.g., terminal equipment sales and inter-carrier payments). The rate for 2023 has been finalized at 0.46%. An interim rate of 0.45% has been established by the CRTC for 2024.

United States Regulatory Environment

The FCC regulates the provision of satellite services to, from, or within the U.S.

Our U.S.-licensed satellites operate on a non-common carrier basis. Consequently, they are not subject to rate regulation or other common carrier regulations enacted under the Communications Act of 1934. We pay FCC filing fees in connection with our space station and earth station applications and annual license and market fees to defray the FCC’s regulatory expenses. Annual and quarterly reports must be filed with the Universal Service Administrative Company (“USAC”) covering interstate/international telecommunications revenues. Based on these reports, USAC assesses us for contributions to the FCC’s Universal Service Fund (“USF”). Payments to the USF are made on a quarterly and annual basis. The USF contribution rate is adjusted quarterly, was set at 34.5% for the fourth quarter of 2023 and 34.6% for the first quarter of 2024. At the present time, the FCC does not assess USF contributions with respect to bare transponder capacity (i.e., agreements for space segment only).

The FCC currently grants geostationary-like satellite authorizations on a first-come, first-served basis to applicants who demonstrate that they are legally and technically qualified and that the public interest will be served by the grant. To facilitate the provision of FSS in C-, Ku-, Ka- and V-band frequencies in the U.S. market, foreign licensed operators can apply to have their satellites either placed on the FCC’s Permitted Space Station List (for certain frequencies) or be granted a declaratory ruling (for other frequencies).

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In contrast, applications for non-geostationary-like satellite authorizations are generally dealt with through processing rounds, initiated by public notice or the submission of a lead application. Grants include conditions of license including deployment milestones. If more than one non-geostationary system from the same processing round intends to use the same frequencies, coordination is required; however, if coordination cannot be reached, the U.S. rules require that band splitting be applied. Non-geostationary systems from a later processing round must protect systems from earlier processing rounds.

The bond and milestone requirements for U.S.-licensed satellites apply equally to foreign-licensed satellites granted U.S. market access. Under these licensing and market access rules, a bond must be posted, starting at US$1 million when a geostationary satellite or non-geostationary satellite constellation authorization is granted and escalating to up to US$3 million in the case of a geostationary satellite and US$5 million in the case of a non-geostationary satellite constellation. The entire amount of the bond may be forfeited if there is failure to meet the FCC’s milestone for the launch and commencement of operations of a geostationary satellite by the fifth anniversary of the grant date or the milestone for the deployment of 50% of the satellites in a non-geostationary satellite constellation by the sixth anniversary of the grant date.

In addition to the loss of the bond, if the 50% non-geostationary milestone is not met, the license or market access authorization is reduced to the number of satellites in the constellation that were in their assigned orbit by the deadline. Similarly, if a non-geostationary operator meets the 50% milestone, it must deploy 100% of its authorized satellites by the ninth anniversary of the grant date, and if that milestone is missed, the license or market access authorization is reduced to the number of satellites that were in their assigned orbit by the deadline. According to current licensing rules and policies, the FCC will issue new satellite licenses for an initial 15-year term and will provide a licensee with an “expectancy” that a subsequent license will be granted for the replacement of an authorized geostationary satellite using the same frequencies. At the end of the 15-year term, a geostationary satellite that has not been replaced, or that has been relocated to another orbital location following its replacement, may be allowed to continue operations for a limited period of time subject to certain restrictions.

As in other jurisdictions, the FCC is considering and may adopt new spectrum allocations for terrestrial mobile broadband and 5G, including in bands that are currently allocated to satellite services.

The U.S. made no WTO commitment to open its DTH, DBS or digital audio radio services to foreign competition, and instead indicated that the provision of these services by foreign operators would be considered on a case-by-case basis, based on an evaluation of the effective competitive opportunities open to U.S. operators in the country in which the foreign satellite was licensed (“ECO-sat test”) as well as other public interest criteria. While Canada currently does not satisfy the ECO-sat test in the case of DTH and DBS service, the FCC has found, in a number of cases, that provision of these services into the U.S. using Canadian-licensed satellites would provide significant public interest benefits and would therefore be allowed.

In order to secure FCC consent for the consummation of the Transaction Agreement, Telesat Canada, Telesat Corporation and several affiliated entities entered into a letter agreement under which they made commitments to the United States Department of Justice relating to such matters as cybersecurity; the access of non-U.S. persons or entities to certain facilities or information; the principal equipment that supports their core telecommunications or information services, functions, or operations; and the availability of certain records and communications in response to lawful U.S. law enforcement requests. This letter agreement replaces an earlier letter agreement that Telesat had entered into with the United States Department of Justice in order to secure FCC consent to the Skynet Transaction.

The export of U.S.-manufactured satellites and technical information related to satellites, earth station equipment and provision of services to certain countries are subject to State Department, Commerce Department and Treasury Department regulations.

Brazil Regulatory Environment

The Brazilian national telecommunications agency, ANATEL, grants exploitation rights for Brazilian satellites to companies incorporated and existing in Brazil. Landing rights of foreign satellites are granted to the owner of the space segment or the company that holds the right to operate it, in whole or in part, but the satellite capacity may only be commercialized in Brazil through the local legal representative. For Brazilian or foreign GEO satellites, the rights

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are granted conditional on payment of applicable fees, are valid for up to 15 years for additional periods limited by the life of the satellite and provided that the obligations already assumed are fulfilled. For NGSO, the term can be extended for additional 15 periods regardless of the satellites’ lifetime.

ANATEL has authorized us, through our subsidiary, Telesat Brasil Capacidade de Satélites Ltda. (“TBCS”), to operate FSS satellites at the 63° WL orbital location. In December 2008, TBCS entered into a 15-year Concession Agreement with ANATEL which obligates TBCS to operate a Ku-band satellite in accordance with Brazilian telecommunications law and contains provisions to enable ANATEL to levy fines for failure to perform according to the Concession Agreement terms. In May 2015, TBCS was the successful bidder in an ANATEL auction for Ka-Band and Ap30B Planned Ku-band frequency rights at the 63° WL orbital location and the associated 15-year Concession Agreements were signed on March 2, 2016. In November 2023, the aforementioned Ku-band rights granted at 63° WL were renewed for the usage by the Estrela do Sul 2 satellite until December 2026, and for the usage by the Telstar 19 VANTAGE satellite until December 2037.

In addition, ANATEL has accredited TBCS as legal representative in Brazil of two non-Brazilian satellites: Telstar 12 VANTAGE and Anik G1.

Tonga Regulatory Environment

We own the Telstar 18 VANTAGE satellite, which currently operates at the 138° EL orbital location under an agreement with APT. APT has been granted the right to use the C- and Ku-band frequencies at the 138° EL orbital location by The Kingdom of Tonga. APT is the direct interface with the Tonga regulatory bodies. Because we have gained access to this orbital location through APT, there is greater uncertainty with respect to our ability to maintain access to this orbital location and the frequencies.

United Kingdom Regulatory Environment

We own and operate the portion of the ViaSat-1 satellite (115° WL) payload that is capable of providing service within Canada. ViaSat-1 operates in accordance with a license granted by the FCC in the U.S. However, by virtue of an intergovernmental arrangement between the U.S. and the United Kingdom, ViaSat-1 operates in accordance with ITU networks filed by the United Kingdom regulatory agency, OFCOM, on behalf of the Isle of Man. The Isle of Man is a British Crown Dependency and Isle of Man satellite frequency filings are filed with the ITU by OFCOM. ManSat Ltd. has been granted rights by the Isle of Man Government to manage Isle of Man satellite frequency filings. Both Telesat and Viasat have a commercial relationship with ManSat. Viasat and Telesat have agreed to cooperate in their dealings with ManSat with respect to the ViaSat-1 satellite for OFCOM and ITU purposes. The Ka-band and portions of the Ku-band frequencies on Telstar 12 VANTAGE, portions of the Ka-band frequencies on Telstar 18 VANTAGE and the Ka-band frequencies on Telstar 19 VANTAGE, are also filed with the ITU by ManSat on behalf of Telesat.

Landing Rights and Other Regulatory Requirements

Many countries regulate satellite transmission signals to, and for uplink signals from, their territory. Telesat has landing rights in major market countries worldwide. In many jurisdictions, landing rights are granted on a per-satellite basis and applications must be made to secure landing rights on replacement satellites.

International Regulatory Environment — International Telecommunication Union

The ITU, a Specialized Agency of the United Nations, is responsible for administering access by member states to frequencies in the radio portion of the electromagnetic spectrum. The ITU Radio Regulations set forth the process that member states must follow to secure rights for geostationary satellite networks and non-geostationary satellite systems to use frequencies, and the obligations and restrictions that govern such use. The process includes, for example, a “first-come, first-served” system for gaining access to certain frequencies, time limits for bringing the frequencies into use by launching one satellite, and in the case of non-geostationary satellite systems, milestones associated with the deployment of additional satellites in the system. In the case of geostationary satellite networks only, certain frequencies at specified orbital locations have been reserved in perpetuity for individual administrations’ use.

Canada, the U.S. and other member states have rights to use certain frequencies. Telesat has been authorized by its ITU filing administrations Canada, USA, Brazil and the United Kingdom of Great Britain and Northern Ireland to use certain frequencies. In addition, through commercial arrangements, Telesat has the right to use certain frequencies for which the Kingdom of Tonga has the rights. Authorized frequencies include those already used by our current

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satellites, and additional frequencies at various geostationary orbital locations or in non-geostationary constellations that must be brought into use within specified time limits. Once brought into use, the ITU rules require that there not be a period longer than three years in which a satellite is not operating under the orbital parameters of a filing.

The ITU Radio Regulations govern the process used by satellite operators to coordinate their operations with other satellite operators to avoid harmful interference. Each member state is required to give notice of, coordinate and register its proposed use of radio frequency assignments with the ITU. The filing and registration process is administered by the ITU Radiocommunications Bureau (“ITU-BR”).

Once a member state has filed its proposed use of frequencies with the ITU, the ITU-BR examines the filing with respect to the various provisions of the International Radio Regulations (RR) to determine the administrations with which coordination is required. Member states are also invited to inform the other member state and the ITU-BR of any intended use that has the potential to cause interference to either existing operations. The member states are then obligated to negotiate with each other in an effort to coordinate the proposed uses and resolve interference concerns. If all outstanding issues are resolved in accordance with the various provisions of the RR, the frequencies are entered into the ITU’s Master International Frequency Register. Registered frequencies are entitled under international law to interference protection from subsequent or nonconforming uses.

Under the ITU Radio Regulations, a member state that places a satellite or any ground station into operation without completing coordination could be vulnerable to interference from other systems and may have to alter the operating parameters of its satellite or ground station if harmful interference occurs.

The process of ITU filing and notification in the MIFR of frequencies spans a period of seven years, or longer, depending upon the frequency band and the various provisions of the ITU Radio Regulations that may be invoked. Telesat’s authorized frequencies are in various stages of the coordination and notification process. Many frequencies have completed the process and have been registered in the MIFR. In other cases, coordination is on-going so that entry into the MIFR is pending or provisional. This is typical for satellite operators. Depending upon the outcome of coordination discussions, satellite operators may need to make concessions in terms of how a frequency may be used. The failure to reach an appropriate arrangement with such satellite operators may render it impossible to secure entry into the MIFR and result in substantial restrictions on the use and operations of our existing satellites. In the event disputes arise during the coordination process or thereafter, the ITU Radio Regulations set forth procedures for resolving disputes but do not contain a mandatory dispute resolution mechanism or an enforcement mechanism. Rather, the rules invite a consensual dispute resolution process for parties to reach a mutually acceptable agreement. Neither the rules nor international law provide a clear remedy for a party where this voluntary process fails.

Other Orbital Spectrum

We have been authorized by governments to operate using additional frequencies at some of the orbital locations where we are currently operating a satellite. In addition, we have been authorized by governments to operate at other orbital locations where we currently do not have a satellite in service as well as a global LEO constellation in Ka-band. Telesat also submitted an application on November 4, 2021 in the U.S. FCC NGSO V-band second processing round for a global LEO constellation in V-band to augment the Ka-band constellation.

In general, our satellites are subject to various regulatory authorities and to the rights of other operators. See “Risk Factors — Risks Relating to Regulatory Matters — Telesat’s operations may be limited or precluded by ITU rules or processes, and it is required to coordinate its operations with those of other satellite operators” for more information about these risks.

Satellite Operations

To ensure continuity of service to our customers, we engineer satellites with on-board redundancies by including spare equipment on the satellite, and conducting standard testing programs that provide high confidence of performance levels.

Our operations and engineering personnel are actively involved in all stages of the lifecycle of a satellite from the design through the deorbiting of the satellites that we procure. Our personnel work directly with our contractors at the contractor’s site to provide technical input and monitor progress during the satellite’s design, construction and launch phases. We monitor earth station operations and around-the-clock satellite control and network operations so that we

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can respond when problems occur. In addition, we have in place contingency plans, which we review on a regular basis, for technical problems that may occur during the life of a satellite. We also work closely with earth station manufacturers to test and implement the earth stations that we procure, and to resolve technical problems as they arise.

Our primary consideration in managing our satellite telecommunications systems is to provide reliable and cost-effective services to our customers. We endeavor to limit the assumption of risk to activities under our control. Our space risk management program has been designed to achieve these objectives.

Insurance and Risk Management Program

Non-Insurance Risk Management Initiatives

The risk management program begins at the technical analysis and design stage of the satellites. We implement certain redundancies on-board every satellite. Furthermore, we are involved in overseeing the manufacturing of all of our satellites. We require the manufacturer and its major subcontractors to follow assembly and quality assurance programs. We secure and maintain access to work performed by the satellite manufacturer and its subcontractors for the purpose of observing the quality and progress of such work.

Comprehensive testing is conducted at the manufacturer’s or a major subcontractor’s plant, which must meet industry standards and, in many cases, be supervised by our engineering personnel. Our engineering personnel review program management and construction schedules, engineering, design, manufacturing and integration and testing activities at both the manufacturer’s and major subcontractor’s sites. After construction is complete, we conduct final acceptance inspections of deliverable items.

We believe it is crucial to have knowledge and insight into the launch vehicles being used to launch our satellites. Our engineering personnel are on site during all phases of the launch campaigns to observe launch preparations and launch operations. We believe that these quality assurance and manufacturing process monitoring programs help us reduce the risk of satellite failures and anomalies and result in lower launch and in-orbit insurance costs.

Satellite Insurance

We are required to maintain certain satellite insurance, subject to permitted exceptions, under the covenants of the Senior Secured Credit Facilities and under the indentures governing the Senior Secured Notes, the 2026 Senior Secured Notes and the Senior Notes. In addition, we may purchase additional insurance as we deem appropriate. At present, the insurance requirement applies only to our GEO satellites.

Satellite insurance falls into three categories: Pre-Launch Insurance, Launch Insurance and In-Orbit Insurance.

Pre

-launch

insurance: Pre-launch insurance is typically purchased by the satellite manufacturer. We manage our pre-launch risks (i.e., risks during the manufacturing and transport phase) primarily through our contractual arrangements with the satellite manufacturer.

Launch insurance: The procurement of satellite launch insurance is, and has been, an integral part of our risk management program. It has been our practice to insure our launches where we bear the risk of loss. Typically, our launch insurance has covered the following events during the period of coverage: (i) delivery from the launch pad to orbit; (ii) separation from the launch vehicle; (iii) drift orbit maneuvers; (iv) solar array and antenna deployment; and (v) testing and commissioning.

-orbit

insurance: In-orbit (life) insurance provides coverage for total and/or partial losses during the operating phase of a satellite. In-orbit insurance may be purchased at the same time launch insurance is procured (for new satellites) or once the satellite is in orbit, in the case of existing satellites, subject to functionality and insurance market conditions. Premium rates are dependent on the operating condition of the satellite and other satellites of the same design or using the same components as well as prevailing insurance market conditions. Typically, these insurance policies exclude coverage for damage arising from acts of war, anti-satellite devices, lasers and other similar potential risks for which exclusions are customary in the industry at the time the policy is written. In addition, they typically exclude coverage for satellite health-related problems affecting our satellites and other satellites of the same design or using the same components that are known at the time the policy is written.

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Other Insurance Coverage

We comply with the requirements to maintain insurance on our GEO satellites under the terms of the Senior Secured Credit Facilities and indentures that govern the Senior Secured Notes, the 2026 Senior Secured Notes and the Senior Notes. Under the most restrictive of these covenants, we are required to maintain insurance equal to a minimum of 33% of the aggregate net book value of any individual and 50% of the aggregate net book value of all in-orbit GEO satellites, subject to certain exceptions. We are permitted to reduce insurance coverage on our satellites, if, for among other reasons, we have made a good faith determination that in-orbit insurance in the amounts required and on the terms required is not available for a price that is, and on other terms and conditions that are, commercially reasonable or the procurement of such insurance would be subject to exclusions or limitations of coverage that would make the terms of the insurance commercially unreasonable. During 2023, satellite insurance market terms conditions deteriorated. Insurance underwriters sought 100% premium rate increases and coverage restrictions. Accordingly, we determined that insurance was not available on commercially reasonable terms for certain of our satellites. We have arranged in-orbit insurance policies that generally expire in November 2024, covering approximately 45% of the net book value of our fleet.

We may discontinue or change our in-orbit insurance practices in the future, subject to the requirements of the Senior Secured Credit Facilities and indentures that govern the Senior Secured Notes, the 2026 Senior Secured Notes and the Senior Notes. Some of our satellite in-orbit insurance policies contain deductibles or coverage exclusions related to potential future failures of certain specific on-board components.

We do not insure our interests in Anik F1, Anik F1R, Anik F2, Anik F3, Anik F4, Telstar 11N, Telstar 14R or Nimiq 2. We also do not insure our capacity on ViaSat-1.

Emergency Committee

Protecting and maintaining service to customers is of vital importance to us. Our emergency committee is responsible for managing the restoration of services in the event of an actual or threatened critical condition, such as a satellite failure, the loss of telemetry and tracking ability or the loss of earth station functionality. Despite our efforts, satellite failures or other anomalies may occur. See “Risk Factors — Risks Relating to the Business of Telesat — Telesat’s in-orbit satellites may fail to operate as expected due to operational anomalies resulting in lost revenues, increased costs and/or termination of contracts.” We may also experience a failure of our ground operations infrastructure. See “Risk Factors — Risks Relating to the Business of Telesat — Telesat may experience a failure of ground operations infrastructure or interference with its satellite signals that impairs the commercial performance of, or the services delivered over, its satellites or the satellites of other operators for whom it provides ground services, which could result in a material loss of revenues.”

Legal Proceedings

We frequently participate in proceedings before national telecommunications regulatory authorities. For more detail, see “— Regulation.” In addition, we may also become involved from time to time in other legal proceedings arising in the normal course of our business.

We are subject to audits by taxing authorities in the various jurisdictions in which we operate. In Brazil, we are currently involved in a number of disputes with the Brazilian tax authorities who have alleged that additional taxes are owed on revenue earned by our Brazilian subsidiaries for the period 2003 to 2018. The total disputed amount for the period 2003 to 2018, including interest and penalties, is currently $111.7 million. The disputes relate to the Brazilian tax authorities’ characterization of revenue. We have challenged the assessments. We believe the likelihood of a favorable outcome is more likely than not, and as such, no reserve has been established.

In Canada, the tax authorities previously reassessed $13.1 million relating to transfer pricing issues for the years 2009 to 2014. All disputes relate to Canadian tax authorities’ repricing of certain transactions between us and our subsidiaries. The Company had challenged the reassessments and paid 50% of the outstanding amounts in order to formally object. In late 2023, the Minister of National Revenue rendered a decision in our favor and reversed the taxes previously assessed. In March 2024, we received a refund of the taxes paid with interest.

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The Canadian tax authorities have reassessed the Company for $11.6 million relating to its Scientific Research and Experimental Development claims for the years 2016 and 2017. The Company has challenged the reassessments and paid 50% of the outstanding amounts in order to formally object. The Company believes the likelihood of a favorable outcome in these disputes is more likely than not and, as such, no reserve has been established.

Other than the above, we are not aware of any proceedings outstanding or threatened as of the date hereof by or against us or relating to our business which may have, or have had in the recent past, significant effects on our financial position or profitability.

Environmental Matters

We are subject to various laws and regulations relating to the protection of the environment and human health and safety (including those governing the management, storage and disposal of hazardous materials). Some of our operations require continuous power supply, and, as a result, current and past operations at our earth stations and other technical facilities include fuel storage, and batteries for back-up generators and uninterruptible power systems. As an owner or operator of property and in connection with current and historical operations at some of our sites, we could incur costs, including cleanup costs, fines, sanctions and third-party claims, as a result of violations of or liabilities under environmental laws and regulations. We are not aware, however, of any environmental matters outstanding or threatened as of the date hereof by or against us or relating to our business which would be material to our financial condition or results of operations.

In a number of countries, regulators are considering and may adopt regulations to ensure the sustainable use of orbit and spectrum resources by satellites. For example, the European Commission is developing an EU Space Law which may contain design requirements for satellites, the compliance with which would be needed for obtaining the right to serve a country within the EU; the United States has an open proceeding (“Mitigation of Orbital Debris in the New Space Age”, see IB Docket No. 18-313) through which new requirements aimed at reducing orbital debris may be applied to NGSO satellite systems seeking US market access; and, the United Nations Office for Outer Space Activities (UNOOSA), through its Committee on the Peaceful Uses of Outer Space (COPUOS), is expected to further develop its “Guidelines for the Long-Term Sustainability of Outer Space Activities” first published in 2019. Certain of these laws and regulations address risks related to generating orbital debris.

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C. Organizational Structure

The following chart reflects our organization structure (including the jurisdiction of formation or incorporation of our material subsidiaries.)

D. Property, Plants and Equipment

For a description of our property, plants and equipment, see Item 4.B. “Business Overview”.

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ITEM 4A. UNRESOLVED STAFF COMMENTS

None

ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS

A. Operating results

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following management’s discussion and analysis (the “MD&A”) for Telesat Corporation is dated March 27, 2024 and provides information concerning our financial condition and results of operations for the year ended December 31, 2023. You should read this MD&A together with Telesat Corporation’s audited consolidated financial statements and the related notes for the year ended December 31, 2023.

As used in this MD&A, unless the context states or requires otherwise, references to “Telesat,” “Company,” “we,” “our” and “us” refer to Telesat Corporation and its subsidiaries. Unless the context states or requires otherwise, reference herein to “the consolidated financial statements” or “the financial statements” or similar terms refer to Telesat Corporation’s audited consolidated financial statements included herein.

All figures reported in this MD&A are in Canadian dollars, except where we indicate otherwise, and are referenced as “$” and “dollars”.

This MD&A contains a translation of some Canadian dollar amounts into United States dollars at specified exchange rates solely for your convenience. All references to “US$” and “U.S. dollar” refer to United States dollars.

Certain totals, subtotals and percentages may not reconcile due to rounding.

The information contained in this MD&A takes into account information available up to March 27, 2024, unless otherwise noted.

This MD&A makes reference to certain non-IFRS measures, namely, Adjusted EBITDA, Adjusted EBITDA margin and Consolidated EBITDA. These measures are not recognized measures under International Financial Reporting Standards (“IFRS”) and do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other companies. Accordingly, these measures should not be considered in isolation nor as a substitute for analysis of our financial information reported under IFRS. Rather, these non-IFRS measures are used to provide investors with supplemental measures of our operating performance and thus highlight trends in our core business that may not otherwise be apparent when relying solely on IFRS measures. We also believe that securities analysts, investors and other interested parties frequently use non-IFRS measures in the evaluation of issuers. Our management also uses non-IFRS measures in order to facilitate operating performance comparisons from period to period, to prepare annual operating budgets and forecasts and to determine components of management compensation. For a reconciliation of the non-IFRS measure to the most closely comparable IFRS measure, see below under the heading “Non-IFRS Measures”.

FORWARD LOOKING STATEMENTS

This MD&A contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. When used in this MD&A, the words “believes,” “expects,” “plans,” “may,” “will,” “would,” “could,” “should,” “anticipates,” “estimates,” “project,” “intend” or “outlook” or other variations of these words or other similar expressions are intended to identify forward-looking statements and information. In addition, Telesat or its representatives have made or may make forward-looking statements, orally or in writing, which may be included in, but are not limited to, various filings made from time to time with the U.S. Securities and Exchange Commission (“SEC”) and Canadian securities regulatory authorities, and press releases or oral statements made with the approval of an authorized executive officer of Telesat. Statements containing forward-looking information are not historical facts nor assurances of future performance but instead represent management’s expectations, estimates and projections regarding future events or circumstances.

These forward-looking statements and other forward-looking information are based on our opinions, estimates and assumptions in light of our experience and perception of historical trends, current conditions and expected future developments, as well as other factors that we currently believe are appropriate and reasonable in the circumstances.

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Actual results may differ materially from anticipated results as a result of certain risks and uncertainties which are described, but are not limited to, the risks listed below and in the section entitled “Risk Factors” included in Telesat’s annual report on Form 20-F for the year ended December 31, 2023 (the “Annual Report”). There may be additional risks of which we are not presently aware or that we currently believe are immaterial which could have an adverse impact on our business. We make no commitment to revise or update any forward-looking statements in order to reflect events or circumstances that may change, except where we are expressly required to do so by law.

Factors that could cause actual results to differ from those projected include, but are not limited to (1) risks associated with financial factors, including swings in the global financial markets, increases in interest rates, fluctuations in foreign exchange rates, and access to capital; (2) risks associated with satellite services, including dependence on large customers, launch delays and failures, in-orbit failures and competition; (3) risks and uncertainties associated with Telesat Lightspeed, including overcoming technological challenges, access to spectrum and markets, governmental restrictions or regulations, the impact of inflation on development costs and financing, raising sufficient capital to design and implement the system and competition from other low earth orbit systems; (4) regulatory risks, such as the effect of industry and government regulations that affect Telesat; and (5) other risks. The foregoing list of important factors is not exclusive. Furthermore, Telesat operates in an industry sector where securities values may be volatile and may be influenced by economic and other factors beyond Telesat’s control.

These factors should not be construed as exhaustive and should be read with the other cautionary statements in this MD&A. These forward-looking statements are based on our current expectations, estimates, forecasts and projections about our business and the industry in which we operate and management’s beliefs and assumptions, and are not guarantees of future performance or development and involve known and unknown risks, uncertainties and other factors that are in some cases beyond our control. As a result, any or all of our forward-looking statements in this MD&A may turn out to be inaccurate.

Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless specifically expressed as such, and should only be viewed as historical data. These forward-looking statements speak only as at the date of this MD&A. Except as required by law, we assume no obligation to update or revise these forward-looking statements for any reason, even if new information becomes available in the future. You should, however, review the factors and risks we describe in the reports we will file from time to time with the SEC and the Canadian securities regulatory authorities, after the date of this MD&A.

This MD&A contains estimates, projections, market research and other information concerning our industry, our business, and the markets for our services. Information that is based on estimates, forecasts, projections, market research or similar methodologies is inherently subject to uncertainties, and actual events or circumstances may differ materially from events and circumstances that are assumed in this information.

In addition, assumptions and estimates of our and our industry’s future performance are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described in the section of our Annual Report entitled “Risk Factors.” These and other factors could cause our future performance to differ materially from our assumptions and estimates.

Any references to forward-looking statements in this MD&A include forward-looking information within the meaning of applicable Canadian securities laws.

Additional information regarding the Company, including results of operations and variances between the year ended December 31, 2022 and 2021, can be obtained on the SEC’s website at https://www.sec.gov and on SEDAR+ at https://www.sedarplus.ca.

OPERATING HIGHLIGHTS

Successful Launch of LEO 3 Demonstration Satellite

In July 2023, we launched our LEO 3 demonstration satellite, which has successfully completed in-orbit testing. The LEO 3 satellite features Ka-and V-band payloads and will provide continuity for customer and ecosystem vendor testing campaigns following the decommissioning of Telesat’s Phase 1 LEO satellite.

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MDA Ltd Contracted to Manufacture Lightspeed Satellites; Telesat Lightspeed Funded Through Global Service Delivery

In August 2023, we announced that space technology company MDA Ltd. has been contracted to build the advanced satellites for the Telesat Lightspeed program. We also announced that we expect to receive funding from our Canadian federal and provincial government partners in the combined amount of up to approximately US$2 billion and that this funding, combined with our own approximately US$1.6 billion equity contribution, as well as certain vendor financing, would provide the Telesat Lightspeed program with sufficient funds to launch global service, which will occur once the first 156 satellites are in orbit.

The finalization of the Canadian federal and provincial funding is dependent on a number of conditions, including the conclusion of definitive agreements.

SpaceX Launch Agreement

In September 2023, we announced that we had entered into a launch agreement with SpaceX for 14 launches on SpaceX’s Falcon 9. These launches will carry up to 18 of our Lightspeed satellites per launch from SpaceX’s launch facilities in California and Florida.

C-band Spectrum Clearing Payments

On June 30, 2023, the Wireless Telecommunications Bureau of the U.S. Federal Communications Commission completed their validation of our Phase II certification of accelerated C-band clearing activities in the 3.7 GHz band and confirmed we were eligible to receive our second accelerated relocation payment of US$259.6 million.

An amount of $344.9 million (US$259.6 million) was recognized and was recorded under other operating gains (losses), net.

Repurchase of Debt

During the year ended December 31, 2023, we repurchased, Senior Secured Notes, 2026 Senior Secured Notes, Senior Unsecured Notes and a portion of our U.S. TLB Facility with an aggregate principal amount of US$427.0 million in exchange for US$255.6 million.

OVERVIEW OF THE BUSINESS

We are a leading global satellite services operator, providing our customers with mission-critical communications services since the start of the satellite communications industry in the 1960s. Through a combination of advanced satellites and ground facilities and a highly expert and dedicated staff, our communications solutions support the requirements of sophisticated satellite users throughout the world. We are organized into one operating segment, the satellite services business; however, we provide our services through three business categories: Broadcast, Enterprise and Consulting and other.

The satellite services business is capital intensive and the build-out of a satellite fleet requires substantial time and investment. Once the investment in a satellite is made, the incremental costs to maintain and operate the satellite are relatively low over the life of the satellite, with the exception of in-orbit insurance. Historically, we have been able to generate a large contracted revenue backlog by entering into long-term contracts with some of our customers for all or substantially all of a satellite’s life.

As at December 31, 2023, we provided satellite services to customers from our fleet of 15 in-orbit geostationary satellites, as well as our Canadian payload on the ViaSat-1 satellite. We also manage the operations of additional satellites for third parties.

We are developing what we believe will be one of the world’s most advanced constellations of low earth orbit satellites and integrated terrestrial infrastructure, called “Telesat Lightspeed” — a platform designed to revolutionize the provision of global broadband connectivity. In January 2018, our first LEO satellite, LEO 1, was successfully launched into orbit. The LEO 1 satellite demonstrated certain key features of the Telesat Lightspeed system design, specifically the capability of the satellite and customer terminals to deliver a low latency broadband experience. In July 2023, we successfully launched our LEO 3 satellite into orbit. We also installed ground infrastructure at our teleport in Allan Park, Ontario, to support testing with a variety of existing and prospective customers and potential suppliers of the Telesat Lightspeed system hardware who have been participating in trials since the second half of 2018.

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Telesat and its affiliates operate satellites pursuant to authorizations granted by governments, including those of Canada, the United States, Brazil, the Kingdom of Tonga and the United Kingdom, to access and use certain geostationary orbital locations and associated spectrum resources. The use of these orbital locations, as well as our other operations, is subject to a variety of Canadian and international regulations.

Revenue

We earn most of our revenue by providing video and data services using satellite transponder capacity. We also earn revenue by providing ground-based transmit and receive services, selling equipment, managing satellite networks, and providing consulting services in the field of satellite communications.

We recognize revenue from satellite services on a monthly basis as services are performed in an amount that reflects the consideration we expect to receive in exchange for those services. We account for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability is considered probable.

Consulting revenue for cost plus contracts is recognized as the approved time and labor is completed by Telesat. We recognize consulting revenue for fixed price contracts using the input method to determine the progress towards complete satisfaction of the performance obligation. Equipment sale revenue is recognized when the customer obtains control of the equipment, being at the time the equipment is delivered to and accepted by the customer.

Expenses

Our operating expenses consist of labor, the cost of which has historically been relatively stable, and variable operating expenses which include in-orbit insurance and direct-billed expenses, such as third-party contractor services. As we further our Lightspeed development, we anticipate that our labor costs will increase.

Interest expense is significant and arises principally from our: Senior Secured Credit Facilities comprised of two outstanding secured credit facilities, which include a revolving facility maturing in 2024 and Term Loan B (“U.S. TLB Facility”) maturing in 2026 (together, the “Senior Secured Credit Facilities”); 6.5% senior unsecured notes due in 2027 issued by Telesat Canada and Telesat LLC, as the co-issuer (the “Senior Unsecured Notes”); 4.875% senior secured notes due in 2027 issued by Telesat Canada and Telesat LLC, as the co-issuer (the “Senior Secured Notes”); and 5.625% senior secured notes due in December 2026 issued by Telesat Canada and Telesat LLC, as the co-issuer (the “2026 Senior Secured Notes”).

Other significant operating expenses include the straight-line depreciation of the cost of each of our satellites over their useful lives and amortization expense related to various finite-life intangible assets.

FUTURE OUTLOOK

Our desirable spectrum rights, commitment to providing the highest level of customer service, deep technical expertise and culture of innovation have enabled us to successfully develop our business to date. Leveraging these strengths and building on our existing contractual revenue backlog, our focus is on profitably growing our business by increasing the utilization of our in-orbit satellites and, in a disciplined manner, deploying expansion satellite capacity where we anticipate there will be strong market demand.

After decades of developing and successfully operating our geosynchronous orbit-based satellite services business, we are now poised to revolutionize the provision of global broadband connectivity by developing what we believe will be the one of world’s most advanced constellations of LEO satellites and integrated terrestrial infrastructure, Telesat Lightspeed.

We believe we are well-positioned to serve our customers and the markets in which we participate. Although we pursue opportunities to develop new satellites, we do not procure additional or replacement satellites until we believe there is a demonstrated need and a sound business plan for such satellite capacity.

Leading into 2024, we remain focused on increasing the utilization of our existing satellites, the development of our global Telesat Lightspeed constellation, and identifying and pursuing opportunities to invest in expansion satellite capacity all while maintaining our operating discipline.

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RESULTS OF OPERATIONS

Review of financial performance

Telesat’s net income for the year ended December 31, 2023, was $583.3 million compared to net loss of $81.6 million for the prior year. The positive variation of $664.9 million was principally due to C-band clearing proceeds recognized in the second quarter of 2023 combined with a positive variation in foreign exchange gain (loss) on the conversion of U.S. dollar debt into Canadian dollars and a higher gain on repurchase of debt. This was partially offset by the impairment tied to certain orbital slots and Telstar 19 VANTAGE.

Below are the foreign exchange rates used for our audited consolidated financial statements and this MD&A:

	2023	2022	2021
US$ to $ spot rate as at December 31,	1.3243	1.3554	1.2637
US$ to $ average rate for the year ended December 31,	1.3493	1.3017	1.2556

Revenue

	Years ended December 31,				% Increase<br>(Decrease)
($ millions except percentages)	2023		2022
Broadcast	$	331.8	$	358.7	(7.5	)%
Enterprise		359.7		389.0	(7.5	)%
Consulting and other		12.6		11.5	9.2	%
Revenue	$	704.2	$	759.2	(7.2	)%

Total revenue for the year ended December 31, 2023, decreased by $55.0 million to $704.2 million compared to $759.2 million for the prior year.

Revenue from Broadcast services decreased by $26.8 million for the year ended December 31, 2023, when compared to the prior year. The decrease was primarily due to a lower rate on the renewal of a long-term agreement with a North American DTH customer, combined with a reduction of services and rate by another North American DTH customer. This was partially offset by a favorable foreign exchange impact on the conversion of U.S. dollar denominated revenue into the Canadian dollar equivalent.

Revenue from Enterprise services decreased by $29.2 million for the year ended December 31, 2023, when compared to the prior year. The decrease was primarily due to the completion of an equipment sale in 2022 to the Defense Advanced Research Projects Agency (“DARPA”) which was not repeated in 2023, combined with lower revenue from certain Latin American customers, partially offset by a favorable foreign exchange impact on the conversion of U.S. dollar denominated revenue into the Canadian dollar equivalent.

Consulting and other revenue increased by $1.1 million for the year ended December 31, 2023, when compared to the prior year. The increase was primarily due to an increased level of consulting activity.

Expenses

	Years ended December 31,					% Increase<br>(Decrease)
($ millions except percentages)	2023			2022
Depreciation	$	182.7		$	188.8	(3.2	)%
Amortization		13.1			15.0	(12.6	)%
Operating expenses		204.6			259.0	(21.0	)%
Other operating (gains), net		(265.0	)		—	(100.0	)%
Total expenses	$	135.3		$	462.7	(70.8	)%

Depreciation

Depreciation of satellites, property and other equipment decreased by $6.1 million for the year ended December 31, 2023, when compared to the prior year. The decrease in depreciation was primarily due to the end of useful lives, for accounting purposes, of our Anik F3 satellite in 2022 and our Nimiq 4 satellite in September 2023, partially offset by depreciation on our newly acquired satellite, Anik F4, and the foreign exchange impact on the conversion of the U.S. dollar depreciation into Canadian dollars.

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Amortization

Amortization of intangible assets decreased by $1.9 million for the year ended December 31, 2023, when compared to the prior year. The decrease was primarily related to the end of useful life, for accounting purposes, of certain revenue backlog.

Operating Expenses

	Years ended December 31,				% Increase<br>(Decrease)
($ millions except percentages)	2023		2022
Compensation and employee benefits	$	117.9	$	152.2	(22.5	)%
Other operating expenses		48.1		52.8	(8.9	)%
Cost of sales		38.5		54.0	(28.7	)%
Operating expenses	$	204.6	$	259.0	(21.0	)%

Total operating expenses decreased by $54.4 million for the year ended December 31, 2023, when compared to the prior year.

Compensation and employee benefits decreased by $34.2 million for the year ended December 31, 2023, in comparison to the prior year. The decrease was primarily due to lower non-cash share-based compensation.

Other operating expenses decreased by $4.7 million for the year ended December 31, 2023, in comparison to the prior year. The decrease was primarily due to lower insurance costs.

Cost of sales decreased by $15.5 million for the year ended December 31, 2023, when compared to the prior year. The decrease was primarily due to higher equipment sales in the year ended December 31, 2022 relating to the DARPA program.

Other Operating (Gains) Losses, Net

	Years ended December 31,
($ millions except percentages)	2023			2022
C-band clearing income	$	344.9		$	—
Impairment		(79.7	)		—
Other		(0.2	)		—
Other operating gains (losses), net	$	265.0		$	—

Other operating (gains) losses, net for the year ended December 31, 2023 primarily related to the recognition of Phase II accelerated clearing payments for the repurposing of U.S. C-band spectrum, partially offset by impairment on certain orbital slots and Telstar 19 VANTAGE.

Interest Expense

	Years ended December 31,					% Increase<br>(Decrease)
($ millions except percentages)	2023			2022
Debt service costs	$	252.3		$	200.5	25.8	%
Interest expense on significant financing component		15.7			17.2	(8.8	)%
Interest expense on satellite performance incentive payments		1.5			1.8	(18.5	)%
Interest expense on employee benefit plans		(0.6	)		0.6	(203.2	)%
Interest expense on leases		1.5			1.6	(5.5	)%
Interest expense	$	270.4		$	221.8	21.9	%

Interest expense included interest related to our debt, as well as, interest related to our derivative instruments, significant financing components on certain revenue agreements, satellite performance incentive payments, employee benefit plans and leases.

Debt service costs, which included interest expense on indebtedness and derivative instruments, increased by $51.7 million for the year ended December 31, 2023, when compared to the prior year. The increase in interest expense was primarily due to an increase in interest rates on the U.S. TLB Facility combined with an unfavorable foreign exchange impact on the conversion of U.S. dollar denominated debt service costs into the Canadian dollar equivalent.

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This was partially offset by the impact of the repurchase of a portion of the U.S. TLB Facility, Senior Unsecured Notes, Senior Secured Notes and 2026 Senior Secured Notes combined with the impact of the maturity of one of our interest rate swaps in September 2022.

Interest expense on significant financing component decreased by $1.5 million for the year ended December 31, 2023, when compared to the prior year. The decrease in interest expense was primarily due to lower average prepayment balances for revenue agreements with a significant financing component.

Interest on satellite performance incentive payments decreased by $0.3 million for the year ended December 31, 2023, when compared to the prior year, primarily due to declining balances of satellite performance incentive liabilities.

Interest expense on employee benefit plans decreased by $1.2 million for the year ended December 31, 2023, when compared to the prior year. The decrease was primarily due to a lower estimate of interest expense according to actuarial reports.

Interest expense on leases decreased by $0.1 million for the year ended December 31, 2023, when compared to the prior year. The decrease was primarily a result of declining balances of capital lease liabilities.

Gain on Repurchase of Debt

	Years ended December 31,
($ millions)	2023		2022
Gain on repurchase of debt	$	230.1	$	106.9

The gain on repurchase of debt for the year ended December 31, 2023 resulted from our repurchases of: Senior Unsecured Notes with a principal amount of $128.9 million (US$95.0 million) in exchange for $53.7 million (US$39.5 million); Senior Secured Notes with a principal amount of $133.6 million (US$100.0 million) in exchange for $77.0 million (US$57.6 million); 2026 Senior Secured Notes with a principal amount of $134.5 million (US$101.0 million) in exchange for $79.6 million (US$59.7 million); and a portion of the U.S. TLB Facility with a principal amount of $177.6 million (US$131.0 million) in exchange for $133.8 million (US$98.8 million).

The gain on repurchase of debt for the year ended December 31, 2022 resulted from our repurchase of Senior Unsecured Notes with a principal amount of $202.1 million (US$160.0 million) in exchange for $97.2 million (US$77.0 million).

Interest and Other Income

	Years ended December 31,
($ millions)	2023		2022
Interest and other income	$	66.5	$	23.5

Interest and other income increased by $43.1 million for the year ended December 31, 2023, when compared to the prior year. The increase was primarily due to higher interest rates earned on our cash and cash equivalent balances, combined with higher cash and cash equivalent balances.

Foreign Exchange and Derivatives

	Years ended December 31,
($ millions)	2023		2022
Gain (loss) on changes in fair value of financial instruments	$	—	$	4.3
Gain (loss) on foreign exchange	$	77.8	$	(239.6	)

The gain on changes in fair value of financial instruments for the year ended December 31, 2022 primarily reflected changes in the fair values of our interest rate swaps, and prepayment options on our Senior Unsecured Notes, Senior Secured Notes and 2026 Senior Secured Notes.

The foreign exchange gain for the year ended December 31, 2023, was $77.8 million compared to a foreign exchange loss of $239.6 million for 2022 resulting in a positive change of $317.3 million.

The gain for the year ended December 31, 2023 was mainly the result of a weaker U.S. dollar to Canadian dollar spot rate as at December 31, 2023 ($1.3243), compared to the spot rate as at December 31, 2022 ($1.3554), and the resulting favorable impact on the translation of our U.S. dollar denominated indebtedness.

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The loss for the year ended December 31, 2022 was mainly the result of a stronger U.S. dollar to Canadian dollar spot rate as at December 31, 2022 ($1.3554), compared to the spot rate as at December 31, 2021 ($1.2637), and the resulting unfavorable impact on the translation of our U.S. dollar denominated indebtedness.

Income Taxes

	Years ended December 31,
($ millions)	2023		2022
Current tax expense (recovery)	$	75.8	$	77.6
Deferred tax expense (recovery)		13.8		(26.2	)
Tax expense (recovery)	$	89.6	$	51.4

The tax expense (recovery) for the year ended December 31, 2023, was $38.2 million higher than the prior year. The increase was primarily due to an increase in operating income and higher gain on repurchase of debt, as compared to the prior year.

Backlog

Remaining performance obligations, which we refer to as contracted revenue backlog (“backlog”), represents our expected future revenue from existing service contracts (without discounting for present value) including any deferred revenue that we will recognize in the future in respect of cash already received. The majority of our contracted revenue backlog is generated from contractual agreements for satellite capacity. We do not include revenue beyond the stated expiration date of a contract regardless of the potential for a renewal. As at December 31, 2023, our contracted backlog was approximately $1.3 billion, which does not include any backlog associated with the Telesat Lightspeed program. For the last three years we have had, on average, approximately 80% of each year’s total revenue already under contract at the beginning of the year.

Generally, following the successful launch of a satellite, if the satellite is operating nominally, our customers may only terminate their service agreements for satellite capacity by paying us all, or substantially all, of the payments that would have otherwise become due over the term of the service agreement. However, if certain of our existing satellites were to experience an in-orbit failure, or otherwise fail to operate as anticipated, our customers may be entitled to terminate their agreement and we may be obligated to return all or a portion of the customer prepayments made under service agreements for that satellite and reduce the associated contractual revenue from revenue backlog. Any repayments under such conditions would be funded by insurance proceeds we may receive, cash on hand, short-term investments, and funds available under our Revolving Credit Facility (as defined below).

We expect our backlog as at December 31, 2023 to be recognized as follows:

($ millions)	2024		2025		2026		2027		2028		Thereafter
Backlog	$	453.5	$	276.5	$	202.4	$	131.4	$	67.5	$	216.5

LIQUIDITY AND CAPITAL RESOURCES

Cash and Available Credit

As at December 31, 2023, we had $1,669.1 million of cash and short-term investments, including $1,247.2 million held in unrestricted subsidiaries, as well as approximately $200.0 million U.S. dollars (or Canadian dollar equivalent) borrowing availability under our Revolving Credit Facility.

Cash Flows generated from Operating Activities

Cash generated from operating activities for the year ended December 31, 2023, was $169.1 million, a $59.8 million decrease compared to the prior year. The decrease was primarily due to higher interest paid combined with an increase in accounts receivable, partially offset by lower income taxes paid and higher interest received.

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Cash Flows generated from Investing Activities

Cash generated from investing activities for the year ended December 31, 2023 was $211.9 million. This consisted of proceeds received from the Phase II accelerated clearing payments for the repurposing of C-band spectrum of $351.4 million. This cash inflow was partially offset by payments associated with the Telesat Lightspeed constellation and the newly acquired Anik F4 satellite.

Cash generated from investing activities for the year ended December 31, 2022 was $0.1 million. This consisted of proceeds received from the Phase I accelerated clearing payments for the repurposing of C-band spectrum of $64.7 million. This cash inflow was partially offset by $31.8 million on payments associated with the Telesat Lightspeed constellation and $32.7 million of payments for property and other equipment.

Cash Flows used in Financing Activities

Cash used in financing activities for the year ended December 31, 2023 was $354.7 million. This was primarily due to the repurchase of a portion of the Senior Unsecured Notes, Senior Secured Notes, 2026 Senior Secured Notes and U.S. TLB Facility.

Cash used in financing activities for the year ended December 31, 2022 was $104.9 million. This was primarily due to the repurchase of a portion of the Senior Unsecured Notes, combined with the payment of final transaction adjustment amount and payments on the satellite performance incentive liabilities. This was partially offset by cash received from our government grant.

Government Grant

In 2019, we entered into an agreement with the Government of Canada (“GoC”) pursuant to which the GoC would contribute up to $85.0 million to support the development of the Telesat Lightspeed constellation through the GoC Strategic Innovation Fund. In return for the grant, Telesat has made a number of commitments to the GoC, including commitments to conduct over $200.0 million of research and development activities in Canada as well as to expand its Canadian workforce.

The costs that were incurred in connection with this program to date are summarized below:

	Years ended December 31,
($ millions)	2023		2022		2021
Satellites, property and other equipment	$	106.9	$	51.3	$	323.0
Intangible assets		16.4		—		—
Operating expenses		48.3		65.8		31.7
Total costs incurred	$	171.6	$	117.1	$	354.7

Total research and development costs for Telesat Lightspeed for the year ended December 31, 2023 increased by $54.4 million, when compared to the prior year. The increase was primarily driven by an increase in the development activities in the Telesat Lightspeed program.

Total research and development costs for Telesat Lightspeed for the year ended December 31, 2022 decreased by $237.6 million from $354.7 million to $117.1 million, when compared to the prior year. The decrease was primarily driven by a reduction in the development activities in the Telesat Lightspeed program.

The following claims against the government grant have been made to date against the costs incurred associated with the program:

	Years ended December 31,
($ millions)	2023		2022		2021
Satellites, property and other equipment	$	15.0	$	3.5	$	10.0
Operating expenses		4.5		5.2		4.8
Prepaid expenses		—		0.1		—
Total costs incurred	$	19.5	$	8.8	$	14.8

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Liquidity

A large portion of our annual cash receipts are reasonably predictable because they are primarily derived from an existing backlog of long-term customer contracts. We believe cash and short-term investments as at December 31, 2023, cash flows from operating activities, and drawings on the Revolving Credit Facility under our Senior Secured Credit Facilities will be adequate to meet our expected cash requirements for at least the next twelve months for activities in the normal course of business, including required interest and principal payments on our indebtedness and our capital requirements. This includes the commitments we have made to date for our Telesat Lightspeed program, but it does not include the capital that would be required to commence construction of the constellation.

We have from time to time used available cash to repurchase some of our existing debt. In the year ended December 31, 2023, we repurchased Senior Secured Notes, 2026 Senior Secured Notes, Senior Unsecured Notes and a portion of our U.S. TLB Facility with a principal amount of US$100.0 million, US$101.0 million, US$95.0 million and US$131.0 million, respectively, in exchange for a combined total of US$255.6 million. We may from time to time continue to seek to repay, repurchase, exchange, refinance or otherwise retire our existing debt in open market transactions, privately negotiated transactions, tender offers, exchange offers, pursuant to the term of debt or otherwise, and have been authorized by our Board of Directors to use up to an additional US$195 million on the further repurchase of our existing debt, should we choose to do so. We may also incur additional debt to fund such transactions or exchange existing debt for newly issued debt obligations or equity or equity-like securities. Such transactions, if any, will depend on prevailing market conditions, trading prices of debt from time to time, our liquidity requirements and cash position, contractual restrictions and other factors. The amount involved in any such transactions, individually or in the aggregate, may be material. We cannot provide any assurance as to if or when we will consummate any such transactions or the terms of any such transactions.

The construction of any satellite replacement or expansion program will require significant capital expenditures, in particular the planned Telesat Lightspeed constellation. Cash required for any future satellite programs may be funded from a range of sources including: cash and short-term investments, cash flows generated from operating activities, cash flows from customer prepayments or through borrowings on the Revolving Credit Facility under the Senior Secured Credit Facilities; vendor financing; equity investments, including through the issuance of public equity; export credit agency financing; additional secured or unsecured debt financing; and from government sources. We may raise additional funding for the Telesat Lightspeed constellation through the issuance of additional equity of, or debt at, our unrestricted subsidiaries which will own, operate and commercialize the Telesat Lightspeed constellation.

In addition, we may sell certain satellite assets and, in accordance with the terms and conditions of the Senior Secured Credit Facilities, reinvest the proceeds in replacement satellites or pay down indebtedness under the Senior Secured Credit Facilities. However, our ability to access these sources of funding is not guaranteed, and therefore, we may not be able to fully fund additional replacement or new satellite programs.

We are developing our planned Telesat Lightspeed constellation in Unrestricted Subsidiaries (as defined in the credit agreement governing our Senior Secured Credit Facilities (the “Credit Agreement”) and indentures governing the Senior Unsecured Notes, Senior Secured Notes and 2026 Senior Secured Notes (together, the “Indentures”)), and we expect to complete the development of, fund, and operate our Telesat Lightspeed constellation through current or future Unrestricted Subsidiaries.

Debt

Senior Secured Credit Facilities

The obligations under the Credit Agreement and the guarantees of those obligations are secured, subject to certain exceptions, by a first priority security interest in the assets of Telesat Canada and certain of our subsidiaries (“Guarantors”). The Credit Agreement contains covenants that restrict the ability of Telesat Canada and the Guarantors to take specified actions, including, among other things and subject to certain significant exceptions: creating liens, incurring indebtedness, making investments, engaging in mergers, selling property, paying dividends, entering into sale-leaseback transactions, creating subsidiaries, repaying subordinated debt or amending organizational documents. The Credit Agreement also requires Telesat Canada and the Guarantors to comply with a maximum first lien leverage ratio and contains customary events of default and affirmative covenants, including an excess cash sweep, that may require us to repay a portion of the outstanding principal under our Senior Secured Credit Facilities prior to the stated maturity.

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Our Senior Secured Credit Facilities are comprised of the following facilities:

i — Revolving Credit Facility

Our Revolving Credit Facility (“Revolving Facility”) is a $200.0 million loan facility available in either U.S. dollar or Canadian dollar equivalent, maturing in December 2024. Loans under the Revolving Facility bore interest at a floating interest rate. For Canadian Prime Rate and Alternative Base Rate (“ABR”) loans, an applicable margin ranging from 0.75% to 1.25% is applied to the Prime Rate and ABR as these interest rates are defined in the Senior Secured Credit Facilities. For Bankers Acceptance (“BA”) Loans and Eurodollar Loans, an applicable margin ranging from 1.75% to 2.25% is applied to either the BA interest rate or London Interbank Offered Rate (“LIBOR”). The rates on the Revolving Facility vary depending upon the results of the first lien leverage ratio. Our Revolving Facility currently has an unused commitment fee that ranges from 25 to 37.5 basis points per annum, depending upon the result of the total leverage ratio.

On May 9, 2023, Telesat Canada entered into a seventh amendment (the “Amendment”) to the Credit Agreement. The Amendment amended the Credit Agreement to replace LIBOR-based benchmark rates with Secured Overnight Financing Rate (“SOFR”)-based benchmark rates and to make certain other conforming changes. Following the Amendment, loans under the Revolving Facility will bear interest, at Telesat Canada’s option, at either (x) in the case of loans denominated in Canadian Dollars, (i) a floating rate based on the Canadian prime rate, plus an applicable margin ranging from 0.75% to 1.25% or (ii) a floating rate based on the Canadian BA rate, plus an applicable margin ranging from 1.75% to 2.25%, or (y) in the case of loans denominated in US dollars, (i) a floating rate based on the base rate, plus an applicable margin ranging from 0.75% to 1.25% or (ii) a floating rate based on SOFR, plus an applicable margin ranging from 1.75% to 2.25%.

As at December 31, 2023, other than approximately $0.2 million in drawings related to letters of credit, there were no borrowings under this facility.

ii — Term Loan B — U.S. Facility

Our Term Loan B — U.S. Facility is a US$1,908.5 million facility maturing in December 2026. As at December 31, 2023, the outstanding balance was US$1,421.8 million.

The borrowings under our U.S. TLB Facility bore interest at a floating rate of either: (i) LIBOR as periodically determined for interest rate periods selected by Telesat Canada in accordance with the terms of the Senior Secured Credit Facilities plus an applicable margin of 2.75%; or (ii) Alternative Base Rate as determined in accordance with the terms of the Senior Secured Credit Facilities plus an applicable margin of 1.75%.

On May 9, 2023, Telesat Canada entered into the Amendment to the Credit Agreement. The Amendment amends the Credit Agreement to replace LIBOR-based benchmark rates with SOFR-based benchmark rates and to make certain other conforming changes. Following the Amendment, loans under the Term Loan B Facility will bear interest, at Telesat Canada’s option, at either (i) a floating rate based on the base rate, plus an applicable margin of 1.75% or (ii) a floating rate based on SOFR, plus an applicable margin of 2.75%. In addition, loans benchmarked against SOFR will be subject to a credit spread adjustment of 0.11448% for a one-month interest period, 0.26161% for a three-month interest period and 0.42826% for a six-month interest period.

During the year ended December 31, 2023, we repurchased a portion of our U.S. TLB Facility with a principal amount of $177.6 million (US$131.0 million) in exchange for $133.8 million (US$98.8 million). The repurchases resulted in a gain on repurchase of debt of $43.8 million.

As at December 31, 2023, US$1,421.8 million of this facility was outstanding, which represents the full amount available.

The mandatory principal repayments on our U.S. TLB Facility are one quarter of 1.00% of the value of the loan, which must be paid on the last day of each quarter. There are currently no mandatory quarterly principal repayments required.

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Senior Secured Notes

Our Senior Secured Notes, in the amount of US$400.0 million, bear interest at an annual rate of 4.875% and are due in June 2027. The indenture governing the Senior Secured Notes includes covenants or terms that restrict our ability to, among other things, incur additional indebtedness, incur liens, pay dividends or make certain other restricted payments, investments or acquisitions, enter into certain transactions with affiliates, modify or cancel our satellite insurance, effect mergers with another entity, and redeem our Senior Secured Notes, without penalty, before December 1, 2024, in each case subject to exceptions provided in the Senior Secured Notes indenture.

During the year ended December 31, 2023, we repurchased Senior Secured Notes with a principal amount of $133.6 million (US$100.0 million) in exchange for $77.0 million (US$57.6 million). The repurchases resulted in a gain on repurchase of debt of $56.7 million. The repurchases also resulted in a write-off of the related debt issue costs and prepayment options.

As at December 31, 2023, US$300.0 million Senior Secured Notes were outstanding.

2026 Senior Secured Notes

On April 27, 2021, we issued US$500.0 million in aggregate principal amount of 2026 Senior Secured Notes which bear interest at an annual rate of 5.625% and are due in December 2026. The indenture governing the 2026 Senior Secured Notes includes covenants and terms that restrict our ability to, among other things, incur additional indebtedness, incur liens, pay dividends or make certain other restricted payments, investments or acquisitions, enter into certain transactions with affiliates, modify or cancel its satellite insurance, and effect mergers with another entity, in each case subject to exceptions provided in such indenture.

During the year ended December 31, 2023, we repurchased 2026 Senior Secured Notes with a principal amount of $134.5 million (US$101.0 million) in exchange for $79.6 million (US$59.7 million). The repurchases resulted in a gain on repurchase of debt of $55.0 million. The repurchases also resulted in a write-off of the related debt issue costs and prepayment options.

As at December 31, 2023, US$399.0 million 2026 Senior Secured Notes were outstanding.

Senior Unsecured Notes

Our Senior Unsecured Notes, in the original principal amount of US$550.0 million, bear interest at an annual rate of 6.5% and are due in October 2027. The indenture governing the Senior Unsecured Notes includes covenants or terms that restrict our ability to, among other things, incur additional indebtedness, incur liens, pay dividends or make certain other restricted payments, investments or acquisitions, enter into certain transactions with affiliates, modify or cancel our satellite insurance, effect mergers with another entity, and redeem our Senior Unsecured Notes, without penalty, before October 15, 2024, in each case subject to exceptions provided in the Senior Unsecured Notes indenture.

During the year ended December 31, 2023, we repurchased Senior Unsecured Notes with a principal amount of $128.9 million (US$95.0 million) in exchange for $53.7 million (US$39.5 million). The repurchases resulted in a gain on repurchase of debt of $75.3 million. The repurchases also resulted in a write-off of the related debt issue costs and prepayment options.

During the year ended December 31, 2022, we repurchased for retirement Senior Unsecured Notes with a principal amount of $202.1 million (US$160.0 million) in exchange for $97.2 million (US$77.0 million). The repurchase resulted in a write-off of the related debt issue costs and prepayment options in the amount of $1.9 million (US$1.5 million) and a gain on extinguishment of debt of $106.9 million (US$84.5 million).

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As at December 31, 2023, US$295.0 million Senior Unsecured Notes were outstanding.

Covenant Compliance

As at December 31, 2023, we were in compliance with the financial covenants of our Senior Secured Credit Facilities, the indenture governing our Senior Unsecured Notes, the indenture governing our Senior Secured Notes and the indenture governing our 2026 Senior Secured Notes.

Debt Service Cost

The interest expense on our Senior Secured Credit Facilities, Senior Unsecured Notes, Senior Secured Notes, and 2026 Senior Secured Notes, excluding the impact of the amortization of deferred financing costs, prepayment options and loss on repayment for the year ended December 31, 2023 was $252.2 million.

Derivatives

We use, from time to time, interest rate and currency derivatives to manage our exposure to changes in interest rates and foreign exchange rates.

We also have embedded derivatives that are accounted for separately at fair value. These embedded derivatives are related to the prepayment option on our Senior Unsecured Notes, the prepayment option on our Senior Secured Notes and the prepayment option on our 2026 Senior Secured Notes. As at December 31, 2023, the fair value of the embedded derivatives related to the prepayment option on our Senior Unsecured Notes, Senior Secured Notes and 2026 Senior Secured Notes was $Nil.

The changes in the fair value of these embedded derivatives are recorded on our consolidated statements of income as a gain or loss on changes in fair value of financial instruments and are non-cash.

All derivative instruments are measured at fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the principal market under current market conditions at the measurement date. Where possible, fair values are based on the quoted market values in an active market. In the absence of an active market, we determine fair values based on prevailing market rates (bid and ask prices, as appropriate) for instruments with similar characteristics and risk profiles or internal or external valuation models, such as option pricing models and discounted cash flow analysis, using observable market-based inputs.

These estimates are affected significantly by the assumptions for the amount and timing of estimated future cash flows and discount rates, which all reflect varying degrees of risk. Potential income taxes and other expenses that would be incurred on disposition of our derivative instruments are not reflected in the fair values. The fair values also include an adjustment related to the counterparty credit risk. As a result, the fair values are not necessarily the net amounts that would be realized if these instruments were actually settled.

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MATERIAL CASH REQUIREMENTS

A summary of the material cash requirements that are due in each of the next five years and after 2028 are summarized the table below:

($ millions)	2024		2025		2026		2027		2028		Thereafter		Total
Satellite performance incentive payments, including interest(1)	$	5.6	$	3.3	$	3.3	$	2.5	$	2.4	$	5.4	$	22.5
Senior Secured Credit Facilities and Notes(2)	$	—	$	—	$	2,411.3	$	788.0	$	—	$	—	$	3,199.2
Interest on long-term indebtedness(2)	$	249.8	$	234.8	$	224.3	$	35.1	$	—	$	—	$	744.0
Lease liabilities(3)	$	3.8	$	3.7	$	3.1	$	2.9	$	2.9	$	30.8	$	47.2
Property lease commitments(4)	$	1.1	$	1.1	$	1.1	$	1.0	$	1.0	$	10.2	$	15.5
Commitments for capital expenditures(5)	$	76.9	$	55.1	$	5.3	$	6.0	$	—	$	—	$	143.3
Other operating commitments(6)	$	31.5	$	14.1	$	9.4	$	8.3	$	18.7	$	68.0	$	150.1
Contributions to defined benefit plans(7)	$	4.7	$	—	$	—	$	—	$	—	$	—	$	4.7

____________

(1) Satellite performance incentive payments are obligations payable to satellite manufacturers over the lives of certain satellites. Satellite performance incentive payments will be paid through the usage of cash and short-term investments, cash flows from operating activities, or drawings on the Revolving Credit Facility under our Senior Secured Credit Facilities.

(2) Balance relates to Senior Secured Credit Facilities, Senior Unsecured Notes, Senior Secured Notes and 2026 Senior Secured Notes and all corresponding interest thereon, excluding the impact of the amortization of deferred financing costs, loss on repayment and prepayment options. Over the next twelve months, the payments will be paid through the usage of cash and short-term investments, cash flows from operating activities, or drawings on the Revolving Credit Facility under our Senior Secured Credit Facilities.

(3) Balance relates to payments to be made in connection with leases. Over the next twelve months, the payments will be made through the usage of cash and short-term investments, cash flows from operating activities, or drawings on the Revolving Credit Facility under our Senior Secured Credit Facilities.

(4) Property lease commitments consists of off-balance sheet contractual obligations for land or building usage. Over the next twelve months, the payments will be made through the usage of cash and short-term investments, cash flows from operating activities, or drawings on the Revolving Credit Facility under our Senior Secured Credit Facilities.

(5) We have entered into contracts for the development of our Telesat Lightspeed constellation and other capital expenditures. These expenditures may be funded from some or all of the following: cash and short-term investments, cash flow from operating activities, cash flow from customer prepayments or funds available under our Revolving Credit Facility.

(6) Other operating commitments consisted of third-party satellite capacity arrangements as well as other commitments that are not categorized as property leases or capital commitments. Over the next twelve months, the payments will be made through the usage of cash and short-term investments, cash flows from operating activities, or drawings on the Revolving Credit Facility under our Senior Secured Credit Facilities.

(7) Over the next twelve months, contributions to the defined benefit pension plans will be made through the usage of cash and short-term investments and cash flows from operating activities. Certain contributions subsequent to 2024 are not quantifiable as they are largely dependent on the result of actuarial valuations that are performed periodically and on the investment performance of the pension fund assets.

MARKET RISK

Credit Risk Related to Financial Instruments

Financial instruments that potentially subject us to a concentration of credit risk consist of cash and short-term investments, accounts receivable, derivative assets and other assets. Cash and short-term investments are invested with high quality financial institutions and are governed by our corporate investment policy, which aims to reduce credit risk by restricting investments to high-grade, mainly U.S. dollar and Canadian dollar denominated investments. Credit checks are performed to minimize exposure to any one customer. We are exposed to credit risk if

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counterparties to our derivative instruments are unable to meet their obligations. It is expected that these counterparties will be able to meet their obligations as they are institutions with strong credit ratings, but we continue to periodically monitor their credit risk and credit exposure.

Foreign Exchange Risk

Our operating results are subject to fluctuations as a result of exchange rate variations to the extent that transactions are made in currencies other than Canadian dollars. The most significant impact of variations in the exchange rate is on our U.S. dollar denominated indebtedness and cash and short-term investments. In addition, a portion of our revenue and expenses, as well as the majority of our capital expenditures are denominated in U.S. dollars. As a result, the volatility of the U.S. currency exposes us to foreign exchange risks.

For the year ended December 31, 2023, we recorded a mainly non-cash foreign exchange gain of approximately $77.8 million due to a weaker U.S. dollar to Canadian dollar spot rate ($1.3243) compared to December 31, 2022 ($1.3554).

For the year ended December 31, 2022, we recorded a mainly non-cash foreign exchange loss of approximately $239.6 million due to stronger U.S. dollar to Canadian dollar spot rate ($1.3554) compared to December 31, 2021 ($1.2637).

The approximate amount of our revenue and certain expenses denominated in U.S. dollars, as a percentage of their overall balance, is summarized in the table below:

Years ended December 31,	2023		2022
Revenue	52.3	%	53.8	%
Operating expenses	39.3	%	37.1	%
Interest on our indebtedness	100.0	%	100.0	%

We use, from time to time, the following instruments to manage our exposure to foreign exchange risk:

• forward currency contracts to hedge foreign exchange risk on anticipated cash flows, mainly related to the construction of satellites and interest payments; and

• currency derivative instruments to hedge the foreign exchange risk on our U.S. dollar denominated indebtedness.

Our policy is that we do not use derivative instruments for speculative purposes. As at December 31, 2023, we have no forward currency contracts nor any currency derivative instruments.

A five percent increase (decrease) in the value of the U.S. dollar against the Canadian dollar would have increased (decreased) our indebtedness as at December 31, 2023 and (decreased) increased our net income for the year ended December 31, 2023 by $160.0 million.

A five percent increase (decrease) in the value of the U.S. dollar against the Canadian dollar would have increased (decreased) our cash and cash equivalents by $75.5 million, increased (decreased) our net income by $10.6 million and increased (decreased) our other comprehensive income by $64.9 million as at and for the year ended December 31, 2023.

A five percent increase (decrease) in the value of the U.S. dollar against the Canadian dollar would have increased (decreased) our revenue and certain expenses for the year ended December 31, 2023, as summarized in the table below:

( millions)
Revenue	18.4
Operating expenses	4.0
Interest on our indebtedness	12.7

All values are in US Dollars.

The sensitivity analyses above assume that all other variables remain constant.

Through our U.S. dollar denominated indebtedness, we are exposed to foreign exchange fluctuations. The following table contains our existing U.S. dollar denominated indebtedness balances at the beginning of each respective year, which are net of our scheduled debt repayments, and based on the foreign exchange rate as at December 31, 2023.

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($ millions, beginning of year)	2024		2025		2026		2027		2028		Thereafter
U.S. TLB Facility	$	1,882.8	$	1,882.8	$	1,882.8	$	—	$	—	$	—
Senior Unsecured Notes		390.7		390.7		390.7		390.7		—		—
Senior Secured Notes		397.3		397.3		397.3		397.3		—		—
2026 Senior Secured Notes		528.4		528.4		528.4		—		—		—
U.S. dollar denominated debt balances	$	3,199.2	$	3,199.2	$	3,199.2	$	788.0	$	—	$	—

Interest Rate Risk

We are exposed to interest rate risk on our cash, short-term investments and on our indebtedness. The interest rate risk on the indebtedness is from a portion of the indebtedness having a variable interest rate. Changes in the interest rates could impact the amount of interest that we receive or are required to pay.

We use, from time to time, interest rate swaps to hedge the interest rate risk related to our indebtedness.

Our policy is that we do not use derivative instruments for speculative purposes. In October 2017, we entered into four interest rate swaps to hedge the interest rate risk associated with the variable interest rate on US$1,800.0 million of the U.S. denominated Term Loan B at fixed interest rates, excluding applicable margins, ranging from 1.72% to 2.04%. As the final interest rate swap matured in 2022, there were no outstanding interest rate swaps as at December 31, 2023 or 2022.

If the interest rates on our variable rate debt increased (decreased) by 0.25%, the result would be a decrease (increase) of $5.1 million to our net income for year ended December 31, 2023.

As at December 31, 2023, through our U.S. TLB Facility we are exposed to interest rate fluctuations. The following table contains the balance of the U.S. TLB facility at the beginning of each respective year, net of our scheduled repayments, and based on the foreign exchange rate as at December 31, 2023.

($ millions)	2024		2025		2026		2027		2028		Thereafter
U.S. TLB Facility	$	1,882.8	$	1,882.8	$	1,882.8	$	—	$	—	$	—

Guarantees

In the normal course of business, we enter into agreements that provide for indemnification and guarantees to counterparties in transactions involving sales of assets, sales of services, purchases and development of assets, securitization agreements and operating leases. The nature of almost all of these indemnifications prevents us from making a reasonable estimate of the maximum potential amount that we could be required to pay counterparties. As a result, we cannot determine how they could affect future liquidity, capital resources or our credit risk profile. We have not made any significant payments under these indemnifications in the past. For more information, see Note 34 of our audited consolidated financial statements.

NON-IFRS MEASURES

Adjusted EBITDA

Adjusted EBITDA is a non-IFRS measure. The common definition of EBITDA is “Earnings Before Interest, Taxes, Depreciation and Amortization.” In evaluating financial performance, we use revenue and deduct operating expenses (excluding share-based compensation expense and unusual and non-recurring items, including restructuring related expenses) to obtain operating income before interest expense, taxes, depreciation and amortization (“Adjusted EBITDA”) and the Adjusted EBITDA margin (defined as the ratio of Adjusted EBITDA to revenue) as measures of our operating performance.

Adjusted EBITDA allows investors and us to compare our operating results with that of competitors exclusive of depreciation and amortization, interest and investment income, interest expense, taxes and certain other expenses. Financial results of competitors in the satellite services industry have significant variations that can result from timing of capital expenditures, the amount of intangible assets recorded, the differences in assets’ lives, the timing and amount of investments, the effects of other income (expense), and unusual and non-recurring items. The use of Adjusted

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EBITDA assists investors and us to compare operating results exclusive of these items. Competitors in the satellite services industry have significantly different capital structures. We believe the use of Adjusted EBITDA improves comparability of performance by excluding interest expense.

We believe the use of Adjusted EBITDA and the Adjusted EBITDA margin along with IFRS financial measures enhances the understanding of our operating results and is useful to investors and us in comparing performance with competitors, estimating enterprise value and making investment decisions. Adjusted EBITDA as used here may not be the same as similarly titled measures reported by competitors. Adjusted EBITDA should be used in conjunction with IFRS financial measures and is not presented as a substitute for cash flows from operations as a measure of our liquidity or as a substitute for net income (loss) as an indicator of our operating performance.

The following is a reconciliation of net income (loss) to Adjusted EBITDA.

	Years ended December 31,
($ millions)	2023			2022
Net income (loss)	$	583.3		$	(81.6	)
Tax expense (recovery)		89.6			51.4
(Gain) loss on changes in fair value of financial instruments		—			(4.3	)
(Gain) loss on foreign exchange		(77.8	)		239.6
Interest and other income		(66.5	)		(23.5	)
Interest expense		270.4			221.8
Gain on repurchase of debt		(230.1	)		(106.9	)
Depreciation		182.7			188.8
Amortization		13.1			15.0
Other operating (gains) losses, net		(265.0	)		—
Non-recurring compensation expenses(1)		1.1			0.3
Non-cash expense related to share-based compensation		33.0			67.4
Adjusted EBITDA	$	533.7		$	567.9
Revenue	$	704.2		$	759.2
Adjusted EBITDA Margin		75.8	%		74.8	%

____________

(1) Includes severance payments, special compensation and benefits for executives and employees.

Adjusted EBITDA for Telesat decreased by $34.2 million for the year ended December 31, 2023, when compared to the prior year. The decrease was primarily due to a decrease in revenues, as discussed above, partially offset by a decrease in operating expense.

Consolidated EBITDA for Covenant Purposes

Under the terms of the Credit Agreement for our Senior Secured Credit Facilities, we are required to comply with a senior secured leverage ratio maintenance covenant as well as with other financial ratio covenants that impact, among other items, our ability to incur debt and make dividend payments.

If our Revolving Credit Facility is drawn by more than 35% of the Credit Facility amount, our Credit Agreement requires us to comply with a first lien net leverage ratio of 5.75:1.00, tested quarterly, and failure to comply will result in an event of default. We refer to this first lien net leverage ratio as the Consolidated Total Secured Debt to Consolidated EBITDA for Covenant Purposes ratio.

Our Credit Agreement limits, among other items, our ability to incur debt and make dividend payments if the total leverage ratio is above 4.50:1.00, with certain exceptions. We refer to this total leverage ratio as the Consolidated Total Debt for Covenant Purposes to Consolidated EBITDA for the purposes of our Senior Secured Credit Facilities.

Our Consolidated Earnings Before Interest, Taxes, Depreciation and Amortization for Covenant Purposes is defined as net income (loss) for Telesat Canada and Restricted Subsidiaries plus interest expense, net of cash interest income earned on cash and cash equivalents, depreciation expense, amortization expense, extraordinary losses and unusual and non-recurring charges, non-cash charges, any expenses or charges incurred in connection with any issuance of debt, any impairment charges or asset write off, foreign withholding taxes paid or accrued and non-cash

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charges related to share-based compensation expense. Additional sums which may be added include projected cost savings from an acquisition and lost revenue which may have been earned by satellites that have been subject to an insured loss. Deductions which are made in calculating Consolidated EBITDA for Covenant Purposes include extraordinary, non-recurring gains and losses and non-cash gains and losses.

Further adjustments are made to account for income from Unrestricted Subsidiaries, and currency gains and losses (including non-cash gains or losses on derivative contracts). Unrestricted Subsidiaries are (a) any Subsidiary of Telesat that is formed or acquired after the closing date of the Credit Agreement, provided that such Subsidiary is designated as an Unrestricted Subsidiary, and (b) any Restricted Subsidiary subsequently re-designated as an Unrestricted Subsidiary.

Consolidated EBITDA for Covenant Purposes is not a presentation made in accordance with IFRS, is not a measure of financial condition or profitability, and should not be considered as an alternative to (1) net income (loss) determined in accordance with IFRS or (2) cash flows from operating activities determined in accordance with IFRS. Additionally, Consolidated EBITDA for Covenant Purposes is not intended to be a measure of free cash flow for management’s discretionary use as it does not include certain cash requirements for such items as interest payments, tax payments and debt service requirements. We believe that the inclusion of Consolidated EBITDA for Covenant Purposes herein is appropriate to provide additional information concerning the calculation of the financial ratio maintenance covenant and other covenants on our Senior Secured Credit Facilities. Consolidated EBITDA for Covenant Purposes is a material component of these covenants. Non-compliance with the financial ratio maintenance covenant contained in our Senior Secured Credit Facilities could result in the requirement to immediately repay all amounts outstanding. This presentation of Consolidated EBITDA for Covenant Purposes is not comparable to other similarly titled measures of other companies because not all companies use identical calculations of EBITDA. We believe the disclosure of the calculation of Consolidated EBITDA for Covenant Purposes provides information that is useful to an investor’s understanding of our liquidity and financial flexibility.

The following is a reconciliation of net income (loss), which is an IFRS measure of our operating results, to Consolidated EBITDA for Covenant Purposes, as defined in the Credit Agreement and the calculation of the ratio of Consolidated Total Secured Debt to Consolidated EBITDA for Covenant Purposes as defined in the Credit Agreement. The terms and related calculations are defined in the Credit Agreement, a copy of which is publicly available at https://www.sec.gov.

($ millions)	Year Ended<br>December 31,<br>2023
Net income (loss)	$	583.3
Impact of unrestricted subsidiaries		(2.7	)
Consolidated income for Covenant Purposes		580.6
Plus:
Income taxes (Note 1)		87.9
Interest expense (Note 1)		236.1
Depreciation and amortization expense (Note 1)		194.0
Non-cash share-based compensation and pension expense (Note 1)		39.1
C-band clearing income		(344.9	)
Impairment		79.7
Other		16.8
Increased (decreased) by:
Gain on repurchase of debt		(230.1	)
Non-cash (gains) losses resulting from changes in foreign exchange rates (Note 1)		(76.5	)
Consolidated EBITDA for Covenant Purposes	$	582.9

____________

Note 1: Some adjustments for covenant purposes excludes certain specific expenses as defined in the Credit Agreement. As a result, these items in the covenant calculation do not reconcile to the financial statement line items.

Consolidated Total Secured Debt and Consolidated Debt for Covenant Purposes

Consolidated Total Debt for Covenant Purposes and Consolidated Total Secured Debt for Covenant Purposes are non-IFRS measures. We believe that the inclusion of Consolidated Total Debt for Covenant Purposes and Consolidated Total Secured Debt for Covenant Purposes herein are appropriate to provide additional information

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concerning the calculation of the financial ratio maintenance and other covenants under our Senior Secured Credit Facilities and provides information that is useful to an investor’s understanding of our compliance with these financial covenants.

The following is a reconciliation of our Consolidated Total Debt for Covenant Purposes and Consolidated Total Secured Debt for Covenant Purposes to Indebtedness:

( millions)
U.S. dollar denominated debt
Term Loan B U.S. Facility (US)	1,421.8
Senior Unsecured Notes (US)	295.0
Senior Secured Notes (US)	300.0
2026 Senior Secured Notes (US)	399.0
	2,415.8
Foreign exchange adjustment	783.4
Subtotal	3,199.2
Deferred financing costs, prepayment options and loss on repayment	(2.2	)
Indebtedness	3,197.0

All values are in US Dollars.

(in millions)
Indebtedness	3,197.0
Adjustments for covenant purposes:
Deferred financing costs, prepayment options and loss on repayment	2.2
Add: lease liabilities	33.1
Consolidated Total Debt	3,232.3
Less: Cash and cash equivalents (max. US100 million)	(132.4	)
Consolidated Total Debt for Covenant Purposes	3,099.9
Consolidated Total Debt	3,232.3
Less: Unsecured debt (Senior Unsecured Notes)	(390.7	)
Consolidated Total Secured Debt	2,841.7
Less: Cash and cash equivalents (max. US100 million)	(132.4	)
Consolidated Total Secured Debt for Covenant Purposes	2,709.2

All values are in US Dollars.

As at December 31, 2023, the Consolidated Total Debt for Covenant Purposes to Consolidated EBITDA ratio, for the purposes of our Senior Secured Credit Facilities was 5.32:1.00. The Consolidated Total Secured Debt to Consolidated EBITDA for Covenant Purposes ratio, for the purposes of our Senior Secured Credit Facilities, was 4.65:1.00.

The consolidated EBITDA for covenant purposes for the Senior Secured Credit Facilities for the year ended December 31, 2022 was $608.3 million. Detailed information of the calculation is included in Item 5. Operating and Financial Review and Prospects — A. Operating results in the Telesat Corporation’s Annual Report for the year December 31, 2022 on form 20-F filed with the SEC on March 29, 2023, which can be obtained on the SEC website at https://www.sec.gov.

As of the date hereof we are in compliance with our debt covenants.

Condensed Consolidating Financial Information

The condensed consolidating financial information reflects the investments, using the equity method of accounting, of Telesat in the Issuers, of the Issuers in their respective Guarantor and Non-Guarantor subsidiaries, and of the Guarantors in their Non-Guarantor subsidiaries.

Balances of Telesat Partnership are inclusive of balances associated with Telesat Partnership LP, Telesat CanHold Corporation, Telesat Can ULC, Loral Space & Communications Inc. and Loral Skynet Corporation.

The condensed consolidating financial information for 2021 and 2022 incorporated the changes from the change accounting policy for the amendments to IAS 12, Income Taxes (“IAS 12”). For additional details on the change in accounting policy, see Accounting Standards section of the MD&A.

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Condensed Consolidating Statements of Income (Loss)For the year ended December 31, 2023

	Telesat <br>Corporation			Telesat <br>Partnership			Telesat <br>LLC		Telesat <br>Canada			Guarantor <br>subsidiaries			Non- <br>guarantor <br>subsidiaries			Adjustments			Consolidated
Revenue	$	—		$	—		$	—	$	598,083		$	372,844		$	14,850		$	(281,616	)	$	704,161
Operating expenses		(509	)		(1,212	)		—		(360,514	)		(72,632	)		(51,301	)		281,616			(204,552	)
Depreciation		—			—			—		(36,190	)		(146,087	)		(1,396	)		1,004			(182,669	)
Amortization		—			—			—		(781	)		(2,669	)		(324	)		(9,319	)		(13,093	)
Other operating gains <br>(losses), net		—			—			—		(11,466	)		(534,146)			(2,039	)		812,650			264,999
Operating income (loss)		(509	)		(1,212	)		—		189,132			(382,690)			(40,210	)		804,335			568,846
Income (loss) from equity investments		30,736			28,873			—		(391,196)			634			—			330,953			—
Interest expense		(69	)		(5	)		—		(259,223	)		(13,767	)		4			2,710			(270,350	)
Gain on repurchase of debt		—			—			—		230,080			—			—			—			230,080
Interest and other income (expense)		2			724			—		106,710			2,831			44,663			(88,398	)		66,532
Gain (loss) on foreign exchange		(620	)		(6	)		—		75,667			632			1,939			146			77,758
Income (loss) before income taxes		29,540			28,374			—		(48,830	)		(392,360	)		6,396			1,049,746			672,866
Tax (expense) recovery		—			2,362			—		77,703			(576	)		(4,022	)		(165,063	)		(89,596	)
Net income (loss)	$	29,540		$	30,736		$	—	$	28,873		$	(392,936)		$	2,374		$	884,683		$	583,270

Condensed Consolidating Statements of Comprehensive Income (Loss)For the year ended December 31, 2023

	Telesat<br>Corporation			Telesat<br>Partnership			Telesat<br>LLC		Telesat<br>Canada			Guarantor<br>subsidiaries			Non-<br>guarantor<br>subsidiaries			Adjustments			Consolidated
Net income (loss)	$	29,540		$	30,736		$	—	$	28,873		$	(392,936)		$	2,374		$	884,683		$	583,270
Other comprehensive income (loss)
Items that may be reclassified into profit or loss
Foreign currency translation adjustments		791			113			—		(4,559	)		(10,306	)		(18,236	)		(18,788	)		(50,985	)
Other comprehensive income (loss) from equity investments		(32,988	)		(33,101	)		—		(28,542	)		(13,926)			—			108,557			—
Items that will not be reclassified into profit or loss
Actuarial gain (loss) on defined benefit plans		—			1,246			—		(6,119	)		(177	)		—			—			(5,050	)
Income tax on items that will not be reclassified to profit or loss		—			—			—		1,628			37			—			—			1,665
Total other comprehensive income (loss) from equity investments		(3,385	)		(4,631	)		—		(140	)		—			—			8,156			—
Total other comprehensive income (loss)		(35,582	)		(36,373	)		—		(37,732	)		(24,372	)		(18,236	)		97,925			(54,370	)
Total comprehensive income (loss)	$	(6,042)		$	(5,637)		$	—	$	(8,859)		$	(417,308)		$	(15,862	)	$	982,608		$	528,900

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Condensed Consolidating Statements of Income (Loss)For the year ended December 31, 2022

	Telesat<br>Corporation			Telesat<br>Partnership			Telesat<br>LLC		Telesat<br>Canada			Guarantor<br>subsidiaries			Non-<br>guarantor<br>subsidiaries			Adjustments			Consolidated
Revenue	$	—		$	—		$	—	$	649,933		$	404,856		$	38,313		$	(333,933	)	$	759,169
Operating expenses		(2,968	)		(925	)		—		(423,873	)		(96,655	)		(68,501	)		333,933			(258,989	)
Depreciation		—			—			—		(34,104	)		(142,661	)		(1,210	)		(10,780	)		(188,755	)
Amortization		—			—			—		(3,172	)		(2,559	)		(313	)		(8,935	)		(14,979	)
Other operating gains (losses), net		—			—			—		(43	)		37			—			13			7
Operating income (loss)		(2,968	)		(925	)		—		188,741			163,018			(31,711	)		(19,702	)		296,453
Income (loss) from equity investments		14,409			19,117			—		130,849			3,411			—			(167,786	)		—
Interest expense		—			(1,149	)		—		(206,447	)		(14,121	)		(23	)		(16	)		(221,756	)
Gain on repurchase of debt		—			—			—		106,916			—			—			—			106,916
Interest and other income (expense)		13			(29	)		—		80,271			728			15,880			(73,387	)		23,476
Gain (loss) on change in fair value of financial instruments		—			—			—		4,314			—			—			—			4,314
Gain (loss) on foreign<br>exchange		54			64			—		(237,208	)		247			(2,748	)		—			(239,591	)
Income (loss) before income taxes		11,508			17,078			—		67,436			153,283			(18,602	)		(260,891	)		(30,188	)
Tax (expense) recovery		—			(2,669	)		—		(48,319	)		1,919			(2,340	)		—			(51,409	)
Net income (loss)	$	11,508		$	14,409		$	—	$	19,117		$	155,202		$	(20,942	)	$	(260,891	)	$	(81,597	)

Condensed Consolidating Statements of Comprehensive Income (Loss)For the year ended December 31, 2022

	Telesat<br>Corporation			Telesat<br>Partnership			Telesat<br>LLC		Telesat<br>Canada			Guarantor<br>subsidiaries			Non- guarantor subsidiaries			Adjustments			Consolidated
Net income (loss)	$	11,508		$	14,409		$	—	$	19,117		$	155,202		$	(20,942	)	$	(260,891	)	$	(81,597	)
Other comprehensive income (loss)
Items that may be reclassified into profit or loss
Foreign currency translation adjustments		(692	)		(1,011	)		—		12,191			25,603			138,086			(25,721	)		148,456
Other comprehensive income (loss) from equity investments		174,869			175,880			—		163,689			41,501			—			(555,939	)		—
Items that will not be reclassified into profit or loss
Actuarial gain (loss) on defined benefit plans		—			7,514			—		24,906			862			—			—			33,282
Income tax on items that will not be reclassified to profit or loss		—			—			—		(6,587	)		(181	)		—			—			(6,768	)
Total other comprehensive income (loss) from equity investments		26,514			19,000			—		681			—			—			(46,195	)		—
Total other comprehensive income (loss)		200,691			201,383			—		194,880			67,785			138,086			(627,855	)		174,970
Total comprehensive income (loss)	$	212,199		$	215,792		$	—	$	213,997		$	222,987		$	117,144		$	(888,746	)	$	93,373

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Condensed Consolidating Statements of Income (Loss)For the year ended December 31, 2021

	Telesat<br>Corporation			Telesat<br>Partnership			Telesat<br>LLC		Telesat<br>Canada			Guarantor<br>subsidiaries			Non-<br>guarantor<br>subsidiaries			Adjustments			Consolidated
Revenue	$	—		$	—		$	—	$	671,525		$	425,303		$	8,157		$	(346,773	)	$	758,212
Operating expenses		(1,246	)		(385	)		—		(465,998	)		(84,607	)		(31,486	)		346,773			(236,949	)
Depreciation		—			—			—		(39,698	)		(174,796	)		(759	)		11,481			(203,772	)
Amortization		—			—			—		(548	)		(2,441	)		(298	)		(12,696	)		(15,983	)
Other operating gains (losses), net		—			(26	)		—		(841	)		20			(1,286,739	)		1,395,201			107,615
Operating income (loss)		(1,246	)		(411	)		—		164,440			163,479			(1,311,125	)		1,393,986			409,123
Income (loss) from equity investments		(879,174	)		(878,451	)		—		(785,542	)		(935,294	)		—			3,478,461			—
Interest expense		—			(55	)		—		(173,684	)		(14,108	)		(34	)		(113	)		(187,994	)
Interest and other income (expense)		—			(257	)		—		46,226			299			1,100			(43,950	)		3,418
Gain (loss) on change in fair value of financial instruments		—			—			—		(18,684	)		—			—			—			(18,684	)
Gain (loss) on foreign<br>exchange		—			—			—		9,471			26,857			(7,740	)		(1,049	)		27,539
Income (loss) before income taxes		(880,420	)		(879,174	)		—		(757,773	)		(758,767	)		(1,317,799	)		4,827,335			233,402
Tax (expense) recovery		—			—			—		(35,617	)		(3,733	)		359,463			(391,148	)		(71,035	)
Net income (loss)	$	(880,420	)	$	(879,174	)	$	—	$	(793,390	)	$	(762,500	)	$	(958,336	)	$	4,436,187		$	162,367

Condensed Consolidating Statements of Comprehensive Income (Loss)For the year ended December 31, 2021

	Telesat<br>Corporation			Telesat<br>Partnership			Telesat<br>LLC		Telesat<br>Canada			Guarantor<br>subsidiaries			Non- guarantor subsidiaries			Adjustments			Consolidated
Net income (loss)	$	(880,420	)	$	(879,174	)	$	—	$	(793,390	)	$	(762,500	)	$	(958,336	)		4,436,187		$	162,367
Other comprehensive income (loss)
Items that may be reclassified into profit or loss
Foreign currency translation adjustments		35			10			—		22,816			(31,037	)		(8,240	)		(1,139	)		(17,555	)
Other comprehensive income (loss) from equity investments		8,237			8,227			—		(39,277	)		7,429			—			15,384			—
Items that will not be reclassified into profit or loss
Actuarial gain (loss) on defined benefit plans		—			816			—		54,596			10			—			—			55,422
Income tax on items that will not be reclassified to profit or loss		—			—			—		(14,424	)		—			—			—			(14,424	)
Total other comprehensive income (loss) from equity investments		40,998			40,182			—		10			—			—			(81,190	)		—
Total other comprehensive income (loss)		49,270			49,235			—		23,721			(23,598	)		(8,240	)		(66,945	)		23,443
Total comprehensive income (loss)	$	(831,150	)	$	(829,939	)	$	—	$	(769,669	)	$	(786,098	)	$	(966,576	)	$	4,369,242		$	185,810

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Condensed Consolidating Balance SheetsAs at December 31, 2023

	Telesat <br>Corporation		Telesat <br>Partnership		Telesat <br>LLC		Telesat <br>Canada		Guarantor <br>subsidiaries		Non- <br>guarantor <br>subsidiaries		Adjustments			Consolidated
Assets
Cash and cash equivalents	$	708	$	7,800	$	—	$	280,859	$	140,561	$	1,239,161	$	—		$	1,669,089
Trade and other receivables		—		—		—		32,517		20,702		25,070		—			78,289
Other current financial assets		—		64		—		—		306		402		(141	)		631
Intercompany receivables		381		1		—		233,258		74,307		714		(308,661	)		—
Current income tax <br>recoverable		—		1,687		—		12,495		2,081		314		(67	)		16,510
Prepaid expenses and other current assets		3,281		—		—		7,606		10,977		38,958		(8,653	)		52,169
Total current assets		4,370		9,552		—		566,735		248,934		1,304,619		(317,522	)		1,816,688
Satellites, property and other equipment		—		—		—		91,410		587,731		539,418		41,739			1,260,298
Deferred tax assets		—		—		—		—		11,895		—		(8,941	)		2,954
Other long-term financial <br>assets		—		8,322		—		2,080		4,553		—		(8,322	)		6,633
Long-term income tax recoverable		—		—		—		7,497		—		—		—			7,497
Other long-term assets		—		—		—		40,635		291		—		—			40,926
Intangible assets		—		—		—		604		557,269		174,119		(39,236	)		692,756
Investment in affiliates		424,652		505,476		—		2,928,832		126,687		—		(3,985,647	)		—
Goodwill		—		—		—		549,162		—		—		1,897,441			2,446,603
Total assets	$	429,022	$	523,350	$	—	$	4,186,955	$	1,537,360	$	2,018,156	$	(2,420,488	)	$	6,274,355
Liabilities
Trade and other payables	$	106	$	43	$	—	$	22,735	$	7,950	$	12,792	$	—		$	43,626
Other current financial<br>liabilities		64		—		—		26,526		2,573		—		(102	)		29,061
Intercompany payables		186		282		—		74,494		223,566		10,133		(308,661	)		—
Income taxes payable		—		—		—		—		142		1,795		(16	)		1,921
Other current liabilities		—		—		—		47,989		23,474		300		(8,644	)		63,119
Total current liabilities		356		325		—		171,744		257,705		25,020		(317,423	)		137,727
Long-term indebtedness		—		—		—		3,197,019		—		—		—			3,197,019
Deferred tax liabilities		—		—		—		216,527		—		25,541		(6,821	)		235,247
Other long-term financial liabilities		8,322		192		—		79		14,646		—		(8,301	)		14,938
Other long-term liabilities		—		9,147		—		96,112		185,182		—		—			290,441
Total liabilities		8,678		9,664		—		3,681,481		457,533		50,561		(332,545	)		3,875,372
Total shareholders’ equity		420,344		513,686		—		505,474		1,079,827		1,967,595		(2,087,943	)		2,398,983
Total liabilities and shareholders’ equity	$	429,022	$	523,350	$	—	$	4,186,955	$	1,537,360	$	2,018,156	$	(2,420,488	)	$	6,274,355

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Condensed Consolidating Balance SheetsAs at December 31, 2022

	Telesat<br>Corporation		Telesat<br>Partnership			Telesat<br>LLC		Telesat<br>Canada		Guarantor<br>subsidiaries		Non-<br>guarantor<br>subsidiaries		Adjustments			Consolidated
Assets
Cash and cash equivalents	$	18	$	4,742		$	—	$	496,106	$	136,713	$	1,040,213	$	—		$	1,677,792
Trade and other receivables		—		—			—		17,672		14,798		8,778		—			41,248
Other current financial assets		—		—			—		—		95		420		—			515
Intercompany receivables		4,543		—			—		240,093		21,864		1,229		(267,729	)		—
Current income tax recoverable		—		1,761			—		14,463		2,285		27		(127	)		18,409
Prepaid expenses and other current assets		3,282		78			—		13,336		13,842		30,627		(10,841	)		50,324
Total current assets		7,843		6,581			—		781,670		189,597		1,081,294		(278,697	)		1,788,288
Satellites, property and other equipment		—		—			—		104,600		757,113		460,623		41,748			1,364,084
Deferred tax assets		—		—			—		—		6,642		—		43,342			49,984
Other long-term financial assets		—		767			—		3,020		6,689		—		—			10,476
Long-term income tax recoverable		—		—			—		15,303		—		—		—			15,303
Other long-term assets		—		—			—		47,686		291		—		—			47,977
Intangible assets		—		—			—		164		1,080,042		527,162		(850,490	)		756,878
Investment in affiliates		508,840		607,303			—		3,631,292		138,496		—		(4,885,931	)		—
Goodwill		—		—			—		549,162		—		—		1,897,441			2,446,603
Total assets	$	516,683	$	614,651		$	—	$	5,132,897	$	2,178,870	$	2,069,079	$	(4,032,587	)	$	6,479,593
Liabilities
Trade and other payables	$	257	$	164		$	—	$	21,584	$	9,361	$	12,189	$	—		$	43,555
Other current financial liabilities		—		—			—		45,549		3,015		—		(167	)		48,397
Intercompany payables		11,606		87			—		70,158		169,820		16,058		(267,729	)		—
Income taxes payable		—		3,233			—		—		—		319		(76	)		3,476
Other current liabilities		—		(3	)		—		62,759		22,836		1,211		(10,835	)		75,968
Total current liabilities		11,863		3,481			—		200,050		205,032		29,777		(278,807	)		171,396
Long-term indebtedness		—		—			—		3,850,081		—		—		—			3,850,081
Deferred tax liabilities		—		—			—		365,983		—		26,141		(120,878	)		271,246
Other long-term financial liabilities		—		197			—		2,348		17,097		—		21			19,663
Other long-term liabilities		—		11,641			—		107,132		208,037		245		—			327,055
Total liabilities		11,863		15,319			—		4,525,594		430,166		56,163		(399,664	)		4,639,441
Total shareholders’ equity		504,820		599,332			—		607,303		1,748,704		2,012,916		(3,632,923	)		1,840,152
Total liabilities and shareholders’ equity	$	516,683	$	614,651		$	—	$	5,132,897	$	2,178,870	$	2,069,079	$	(4,032,587	)	$	6,479,593

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Condensed Consolidating Statements of Cash FlowsFor the year ended December 31, 2023

	Telesat <br>Corporation			Telesat <br>Partnership			Telesat <br>LLC		Telesat <br>Canada			Guarantor <br>subsidiaries			Non- <br>guarantor subsidiaries			Adjustments			Consolidated
Cash flows from (used in) operating activities
Net income (loss)	$	29,540		$	30,736		$	—	$	28,873		$	(392,936)		$	2,374		$	884,683		$	583,270
Adjustment to reconcile net income (loss) to cash flows from operating activities
Depreciation		—			—			—		36,190			146,087			1,396			(1,004	)		182,669
Amortization		—			—			—		781			2,669			324			9,319			13,093
Tax expense (recovery)		—			(2,362	)		—		(77,703)			576			4,022			165,063			89,596
Interest expense		69			5			—		259,223			13,767			(4	)		(2,710	)		270,350
Interest income		(2	)		(110	)		—		(17,043	)		(4,726	)		(44,667	)		2,710			(63,838	)
(Gain) loss on foreign exchange		620			6			—		(75,667	)		(632	)		(1,939	)		(146	)		(77,758	)
Share-based compensation		(692	)		—			—		32,473			3,774			(2,540	)		—			33,015
(Income) loss from equity investments		(30,736	)		(28,873	)		—		391,196			(634)			—			(330,953)			—
(Gain) loss on disposal of assets		—			—			—		11,466			(36	)		2,039			(13,528	)		(59	)
Gain on repurchase of debt		—			—			—		(230,080	)		—			—			—			(230,080	)
Impairment		—			—			—		—			534,182			—			(454,442)			79,740
Deferred revenue amortization		—			—			—		(28,284	)		(30,080	)		(973	)		—			(59,337	)
Pension expense		—			684			—		4,990			—			—			—			5,674
Other		—			—			—		1,299			1,659			—			—			2,958
C-band clearing income		—			—			—		—			—			—			(344,892	)		(344,892	)
Income taxes paid, net of income taxes received		—			(186	)		—		(58,227	)		(5,748	)		(2,680	)		—			(66,841	)
Interest paid, net of interest received		(62	)		110			—		(255,642	)		3,110			43,223			—			(209,261	)
Operating assets and liabilities		1,958			(8,710	)		—		(8,344	)		(1,800	)		(17,328	)		(4,988	)		(39,212	)
Net cash from (used in) operating activities		695			(8,700	)		—		15,501			269,232			(16,753	)		(90,888	)		169,087
Cash flows (used in) generated from investing activities
Cash payments related to satellite <br>programs		—			—			—		(8,934	)		—			(74,385	)		—			(83,319	)
Cash payments related to property and other equipment		—			—			—		(12,297	)		(635	)		(29,988	)		—			(42,920	)
Purchase of intangible assets		—			—			—		(13,211	)		(56	)		—			—			(13,267	)
Return of capital to shareholder		—			11,807			—		172,074			—			—			(183,881	)		—
Investment in affiliates		—			—			—		—			(750	)		—			750			—
C-band clearing proceeds		—			—			—		—			—			351,438			—			351,438
Net cash (used in) generated from investing activities		—			11,807			—		137,632			(1,441	)		247,065			(183,131	)		211,932
Cash flows (used in) generated from financing activities
Repurchase of indebtedness		—			—			—		(344,014	)		—			—			—			(344,014	)
Payment of principal on lease liabilities		—			—			—		(1,277	)		(492	)		(402	)		—			(2,171	)
Satellite performance incentive payments		—			—			—		(4,437	)		(1,948	)		—			—			(6,385	)
Government grant received		—			—			—		—			—			1,089			—			1,089
Return of capital to shareholder		—			—			—		(11,807	)		(172,074	)		—			183,881			—
Proceeds from exercise of stock options		—			—			—		27			—			—			—			27
Tax withholdings on settlement of restricted share units		—			—			—		(2,883	)		(247	)		(68	)		—			(3,198	)
Proceeds from issuance of share capital		—			—			—		—			—			750			(750	)		—
Dividends paid		—			—			—		(10	)		(85,545	)		(5,333	)		90,888			—
Net cash (used in) generated from financing activities		—			—			—		(364,401	)		(260,306	)		(3,964	)		274,019			(354,652	)
Effect of changes in exchange rates on cash and cash equivalents		(5	)		(49	)		—		(3,979	)		(3,637	)		(27,400	)		—			(35,070	)
Changes in cash and cash equivalents		690			3,058			—		(215,247	)		3,848			198,948			—			(8,703	)
Cash and cash equivalents, beginning <br>of year		18			4,742			—		496,106			136,713			1,040,213			—			1,677,792
Cash and cash equivalents, end of year	$	708		$	7,800		$	—	$	280,859		$	140,561		$	1,239,161		$	—		$	1,669,089

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Condensed Consolidating Statements of Cash FlowsFor the year ended December 31, 2022

	Telesat<br>Corporation			Telesat<br>Partnership			Telesat<br>LLC		Telesat<br>Canada			Guarantor<br>subsidiaries			Non-<br>guarantor<br>subsidiaries			Adjustments			Consolidated
Cash flows from (used in) operating activities
Net income (loss)	$	11,508		$	14,409		$	—	$	19,117		$	155,202		$	(20,942	)	$	(260,891	)	$	(81,597	)
Adjustment to reconcile net income (loss) to cash flows from operating activities
Depreciation		—			—			—		34,104			142,661			1,210			10,780			188,755
Amortization		—			—			—		3,172			2,559			313			8,935			14,979
Tax expense (recovery)		—			2,669			—		48,319			(1,919	)		2,340			—			51,409
Interest expense		—			1,149			—		206,447			14,121			23			16			221,756
Interest income		(13	)		(16	)		—		(6,361	)		(1,293	)		(15,881	)		—			(23,564	)
(Gain) loss on foreign exchange		(54	)		(64	)		—		237,208			(247	)		2,748			—			239,591
(Gain) loss on changes in fair value of financial instruments		—			—			—		(4,314	)		—			—			—			(4,314	)
Share-based compensation		692			—			—		61,629			3,750			1,357			—			67,428
(Income) loss from equity investments		(14,409	)		(19,117	)		—		(130,849	)		(3,411	)		—			167,786			—
(Gain) loss on disposal of assets		—			—			—		43			(37	)		—			(13	)		(7	)
Gain on repurchase of debt		—			—			—		(106,916	)		—			—			—			(106,916	)
Deferred revenue amortization		—			—			—		(32,233	)		(27,503	)		(17,339	)		—			(77,075	)
Pension expense		—			540			—		7,047			—			—			—			7,587
Other		—			—			—		(2,454	)		1,270			—			—			(1,184	)
Income taxes paid, net of income taxes received		—			(39	)		—		(91,993	)		(3,449	)		(2,662	)		—			(98,143	)
Interest paid, net of interest received		13			16			—		(177,578	)		(358	)		14,794			—			(163,113	)
Operating assets and liabilities		2,277			1,625			—		(41,352	)		12,929			17,653			124			(6,744	)
Net cash from (used in) operating activities		14			1,172			—		23,036			294,275			(16,386	)		(73,263	)		228,848
Cash flows (used in) generated from investing activities
Cash payments related to satellite programs		—			—			—		—			—			(31,805	)		—			(31,805	)
Cash payments related to property and other equipment		—			—			—		(3,931	)		(522	)		(28,248	)		—			(32,701	)
Purchase of intangible assets		—			—			—		—			(71	)		—			—			(71	)
Return of capital to shareholder		—			23,290			—		191,248			—			—			(214,538	)		—
C-band clearing proceeds		—			—			—		—			—			64,651			—			64,651
Net cash (used in) generated from investing activities		—			23,290			—		187,317			(593	)		4,598			(214,538	)		74
Cash flows (used in) generated from financing activities
Repurchase of indebtedness		—			—			—		(97,234	)		—			—			—			(97,234	)
Payment of principal on lease liabilities		—			—			—		(1,193	)		(944	)		(361	)		—			(2,498	)
Satellite performance incentive payments		—			—			—		(4,896	)		(1,771	)		—			—			(6,667	)
Government grant received		—			—			—		—			—			22,324			—			22,324
Final Transaction adjustment payment		—			(20,790	)		—		—			—			—			—			(20,790	)
Return of capital to shareholder		—			—			—		(23,290	)		(191,248	)		—			214,538			—
Dividends paid		—			—			—		—			(73,263	)		—			73,263			—
Net cash (used in) generated from financing activities		—			(20,790	)		—		(126,613	)		(267,226	)		21,963			287,801			(104,865	)
Effect of changes in exchange rates on cash and cash equivalents		—			166			—		43,588			8,922			51,466			—			104,142
Changes in cash and cash equivalents		14			3,838			—		127,328			35,378			61,641			—			228,199
Cash and cash equivalents, beginning of year		4			904			—		368,778			101,335			978,572			—			1,449,593
Cash and cash equivalents, end of year	$	18		$	4,742		$	—	$	496,106		$	136,713		$	1,040,213		$	—		$	1,677,792

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Condensed Consolidating Statements of Cash FlowsFor the year ended December 31, 2021

	Telesat<br>Corporation			Telesat<br>Partnership			Telesat<br>LLC		Telesat<br>Canada			Guarantor<br>subsidiaries			Non-<br>guarantor<br>subsidiaries			Adjustments			Consolidated
Cash flows from (used in) operating activities
Net income (loss)	$	(880,420	)	$	(879,174	)	$	—	$	(793,390	)	$	(762,500	)	$	(958,336	)	$	4,436,187		$	162,367
Adjustment to reconcile net income (loss) to cash flows from operating activities
Depreciation		—			—			—		39,698			174,796			759			(11,481	)		203,772
Amortization		—			—			—		548			2,441			298			12,696			15,983
Tax expense (recovery)		—			—			—		35,617			3,733			(359,463	)		391,148			71,035
Interest expense		—			55			—		173,684			14,108			34			113			187,994
Interest income		—			—			—		(2,181	)		(978	)		(1,233	)		—			(4,392	)
(Gain) loss on foreign exchange		—			—			—		(9,471	)		(26,857	)		7,740			1,049			(27,539	)
(Gain) loss on changes in fair value of financial instruments		—			—			—		18,684			—			—			—			18,684
Share-based compensation		—			—			—		73,698			25			—			—			73,723
(Income) loss from equity investments		879,174			878,451			—		785,542			935,294			—			(3,478,461	)		—
(Gain) loss on disposal of assets		—			26			—		841			(20	)		—			1			848
Deferred revenue amortization		—			—			—		(39,684	)		(24,990	)		(324	)		—			(64,998	)
Pension expense		—			74			—		8,059			—			—			—			8,133
C-band clearing income		—			—			—		—			—			64,289			(107,149	)		(42,860	)
Impairment		—			—			—		—			—			1,286,739			(1,286,739	)		—
Other		—			—			—		(2,531	)		578			—			—			(1,953	)
Income taxes paid, net of income taxes received		—			—			—		(90,882	)		(2,564	)		(796	)		—			(94,242	)
Interest paid, net of interest received		—			—			—		(155,027	)		(643	)		1,237			—			(154,433	)
Operating assets and liabilities		1,250			(691	)		—		59,652			(19,918	)		(97,490	)		(1,428	)		(58,625	)
Net cash from (used in) operating activities		4			(1,259	)		—		102,857			292,505			(56,546	)		(44,064	)		293,497
Cash flows (used in) generated from investing activities
Cash payments related to satellite programs		—			—			—		—			—			(279,941	)		—			(279,941	)
Cash payments related to property and other equipment		—			—			—		(5,751	)		(790	)		(26,387	)		1,203			(31,725	)
Purchase of intangible assets		—			—			—		—			(73	)		—			(1,089	)		(1,162	)
Return of capital to shareholder		—			—			—		215,967			—			—			(215,967	)		—
Investment in affiliates		—			—			—		(641,800	)		—			—			641,800			—
C-band clearing proceeds		—			—			—		—			—			42,860			—			42,860
Net cash (used in) generated from investing activities		—			—			—		(431,584	)		(863	)		(263,468	)		425,947			(269,968	)
Cash flows (used in) generated from financing activities
Proceeds from indebtedness		—			—			—		619,900			—			—			—			619,900
Payment of debt issue costs		—			—			—		(6,834	)		—			—			—			(6,834	)
Payments of principal on lease liabilities		—			—			—		(1,457	)		(433	)		(288	)		—			(2,178	)
Satellite performance incentive<br> payments		—			—			—		(5,376	)		(1,538	)		—			—			(6,914	)
Return of capital to shareholder		—			—			—		—			(215,967	)		—			215,967			—
Initial costs from Transaction		—			1,260			—		—			—			—			—			1,260
Proceeds from exercise of stock options		—			—			—		16			—			—			—			16
Proceeds from issuance of share capital		—			—			—		—			—			641,800			(641,800	)		—
Dividends paid		—			—			—		(10	)		(43,950	)		—			43,950			(10	)
Net cash (used in) generated from financing activities		—			1,260			—		606,239			(261,888	)		641,512			(381,883	)		605,240
Effect of changes in exchange rates on cash and cash equivalents		—			—			—		22,107			(2,007	)		(17,654	)		—			2,446
Changes in cash and cash equivalents		4			1			—		299,619			27,747			303,844			—			631,215
Cash and cash equivalents, beginning of year		—			—			—		69,159			73,588			675,631			—			818,378
Cash and cash equivalents, end of year	$	4		$	1		$	—	$	368,778		$	101,335		$	979,475		$	—		$	1,449,593

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CURRENT SHARE INFORMATION

The number of shares and stated value of the outstanding Class A common shares and Class B variable voting shares (“Telesat Public shares”), and Class C fully voting shares and Class C limited voting shares (together, the “Class C shares”) as at December 31, 2023, were as follows:

(in thousands of $, except number of shares)	Number of <br>shares	Stated <br>value
Telesat Public Shares	13,497,501	$	44,912
Class C Shares	112,841		6,340
	13,610,342	$	51,252

The breakdown of the number of Telesat Public Shares, as at December 31, 2023, was as follows:

Telesat Public shares
Class A Common shares	1,242,656
Class B Variable voting shares	12,254,845
Total Telesat Public shares	13,497,501

The split between the Class A Common shares and Class B Variable Voting shares in the table above is based on information available to us as at December 31, 2023.

In addition, we have one Class A Special Voting Share, one Class B Special Voting Share, one Class C Special Voting Share and one Golden Share outstanding, each with a nominal stated value as at December 31, 2023 and 2022.

The number of outstanding stock options, restricted share units (“RSUs”), performance share units (“PSUs”) and deferred share units (“DSUs”) issued under our Omnibus Plan and Historic Plan as at December 31, 2023 were as follows:

	Historic <br>Plan	Omnibus <br>Plan
Stock Options	199,634	803,265
RSUs with time criteria	517,688	784,725
RSUs with time and performance criteria	124,080	—
PSUs with time and performance criteria	—	375,137
DSUs	—	124,616
	841,402	2,087,743

Each of the foregoing securities can be settled or exercised, as applicable, for Telesat Public Shares.

During the year ended December 31, 2023, 532,122 RSUs were settled for 271,578 Telesat Public Shares, on a net settlement basis.

During the year ended December 31, 2023, 532,473 Telesat Public Shares were issued in exchange for an equal number of Class B LP Units in the Partnership.

During the year ended December 31, 2023, 1,000 Stock Options were exercised in exchange for an equal number of Telesat Public Shares.

The number and stated value of the outstanding LP Units issued by Telesat Partnership LP as at December 31, 2023, were as follows:

(in thousands of $, except number of units)	Number of units	Stated value
Class A and Class B LP Units	18,321,792	$	50,141
Class C LP Units	18,098,362		38,893
	36,420,154	$	89,034

On consolidation into Telesat Corporation, the stated value of the LP Units is included in non-controlling interest.

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CRITICAL ACCOUNTING JUDGMENTS AND ESTIMATES

The preparation of financial statements in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IASB”) requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as at the date of the financial statements, and the amounts of revenue and expenses reported for the year. Actual results could differ from these estimates under different assumptions and conditions. For more details on these estimates, refer to Note 5 of our audited consolidated financial statements.

Critical judgments in applying accounting policies

Deferred revenue

Certain of our revenue agreements were noted to have a significant financing component. Judgment by management is required to determine the discount rate used in the significant financing component calculation. There were no new agreements entered into in 2023 which included a significant financing component.

Lease liability

Judgment by management is required in the determination of the likelihood that the lease renewal periods will be exercised as well as the determination of the incremental borrowing rate. There were no new material lease agreements in 2023.

Uncertain income tax positions

We operate in numerous jurisdictions and are subject to country-specific tax laws. We use significant judgment when determining the worldwide provision for tax, and estimate provisions for uncertain tax positions as the amounts expected to be paid based on a qualitative assessment of all relevant factors. In the assessment, we consider risk with respect to tax matters under active discussion, audit, dispute or appeal with tax authorities, or which are otherwise considered to involve uncertainty. We review the provisions at each balance sheet date.

Software as a service arrangements

Judgment by management is required to determine whether configuration or customization of a software results in an intangible asset for Telesat.

Critical accounting estimates and assumptions

Derivative financial instruments measured at fair value

Derivative financial assets and liabilities are measured at fair value. When quoted market values are unavailable for our financial instruments, and in the absence of an active market, we determine fair value for financial instruments based on prevailing market rates (bid and ask prices, as appropriate) for instruments with similar characteristics and risk profiles or we make use of internal or external valuation models, such as option pricing models and discounted cash flow analysis, using observable market-based inputs. The determination of fair value is significantly impacted by the assumptions used for the amount and timing of estimated future cash flows and discount rates. As a result, the fair value of financial assets and liabilities, and the amount of gains or losses on changes in fair value recorded to net income could vary. The discount rates used to discount cash flows as at December 31, 2023 ranged from 4.06% to 5.59% while as at December 31, 2022 the discount rates ranged from 4.00% to 5.16%.

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Impairment of goodwill

Goodwill represented $2,446.6 million of our total assets as at December 31, 2023. Determining whether goodwill is impaired using a quantitative approach requires an estimation of our fair value, which requires us to estimate the future cash flows expected to arise from operations and to make assumptions regarding the underlying business plan, discount rates, and growth rate assumptions. Actual operating results and our related cash flows could differ from the estimates used for the impairment analysis. The discount rate utilized on the goodwill impairment assessment ranged from 9.5% to the midpoint between 15% and 20% in 2023 (2022 – 9.0% to the midpoint between 15% and 20%).

Impairment of intangible assets

Intangible assets represented a significant portion of our total assets as at December 31, 2023. We test intangible assets for impairment annually or more frequently if indicators of impairment or reversal of a prior impairment loss exist. The quantitative impairment analysis requires us to estimate the future cash flows expected to arise from operations, and to make assumptions regarding the underlying business plan, discount rates, growth rate assumptions and royalty rate. Significant judgments are made in establishing these assumptions. Actual operating results and our related cash flows could differ from the estimates used for the impairment analysis. The discount rate utilized on the intangible assets impairment assessment ranged from 9.5% to the midpoint between 15% and 20% in 2023 (2022 – 9.0% to the midpoint between 15% and 20%).

Indefinite life intangible assets are tested for impairment at the individual CGU level. In the case of orbital slots, the CGU is based on geography. During the year ended December 31, 2023, as a result of impairment testing of the geographical CGUs, there was an impairment of $66.0 million recorded against intangible assets and $13.8 million recorded against satellites, property and other equipment. For additional details of the impairment that was recorded, refer to Notes 16 and 17 of the 2023 consolidated financial statements.

Employee benefits

The cost of defined benefit pension plans, other post-employment benefits, and the present value of the pension obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions which may differ from actual developments in the future. These include the determination of the discount rate, future salary increases, mortality rates, future pension increases and return on plan assets. Due to the complexity of the valuation, the underlying assumptions, and its long-term nature, the defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed annually. See Note 32 of our audited consolidated financial statements for a sensitivity analysis of the assumptions used in the actuarial valuation.

Share-based compensation

The expense for stock options is based on the fair value of the awards granted using the Black-Scholes option pricing model. The Black-Scholes option pricing model includes estimates of the dividend yield, expected volatility, risk-free interest rate and the expected life in years. Any changes in these estimates may have a significant impact on the amounts reported.

Determination of useful life of satellites and finite life intangible assets

The estimated useful life and depreciation method for satellites and finite life intangible assets are reviewed annually, with the effect of any changes in estimate being accounted for on a prospective basis. Any change in these estimates may have a significant impact on the amounts reported. There were no changes in the estimated useful lives of satellites and intangible assets during 2023.

Income taxes

We assess the recoverability of deferred tax assets based upon an estimation of our projected taxable income using enacted or substantially enacted tax laws, and our ability to utilize future tax deductions before they expire. Actual results could differ from expectations.

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ACCOUNTING STANDARDS

Change in Accounting Policy

Amendments to IAS 12

In May 2021, the IASB issued amendments to IAS 12.

In specified circumstances, companies are exempt from recognizing deferred tax when they recognize assets or liabilities for the first time. The amendments clarify that such initial recognition exemption does not apply to transactions in which equal amounts of deductible and taxable temporary differences arise on initial recognition. Accordingly, entities are required to recognize deferred tax associated with transactions, such as leases and decommissioning obligations, which give rise to equal and offsetting temporary differences.

We adopted the amendments effective for annual period beginning January 1, 2023. As a result of the amendment, we were required to recognize deferred tax on the prepayment options associated with the Senior Unsecured Notes, Senior Secured Notes and 2026 Senior Secured Notes.

An adjustment was recorded as a decrease to the opening balance of accumulated earnings as at January 1, 2021 in the amount of $1,412.

The cumulative impact on the balance sheet and the statement of changes in shareholders’ equity was as follows:

As at December 31,	2022			2021
Deferred tax liabilities	$	(4,450	)
Accumulated earnings	$	1,071		$	1,439
Non-controlling interest	$	3,379		$	4,491

As a result of the amendment, there was also a change in the reallocation related to Transaction in the year ended December 31, 2021.

The impact on the statements of income (loss) and the statements of comprehensive income (loss) was as follows:

For the years ended December 31,	2022			2021
Tax (expense) recovery	$	(1,480	)	$	7,342
Net income (loss) per common share attributable to Telesat Corporation shareholders – Basic	$	(0.03	)	$	0.16
Net income (loss) per common share attributable to Telesat Corporation shareholders – Diluted	$	(0.03	)	$	0.16

Future Changes in Accounting Policies

The IASB periodically issues new and amended accounting standards. The new and amended standards determined to be applicable to us are disclosed below. The remaining new and amended standards have been excluded as they are not applicable.

Amendments to IAS 1

In October 2022, the IASB amended IAS 1, Presentation of Financial Statements with the aim of improving the information companies provide about long-term debt covenants.

The amendments specify that covenants to be complied with after the reporting date do not affect the classification of debt as current or non-current at the reporting date. Only covenants with which an entity is required to comply on or before the reporting date affect the classification of a liability as current or non-current. The amendment requires a company to disclose information that enables users of financial statements to understand the risk that the liabilities could become repayable within twelve months after the reporting period. Such disclosure includes information about covenants and facts and circumstances, if any, that indicate the entity may have difficulty complying with the covenants.

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The amendments are effective for annual reporting periods beginning on or after January 1, 2024 with early adoption permitted.

The amendments will not have any impact on the financial statements.

ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

A. Directors and Senior Management

The following table sets forth certain information regarding Telesat Corporation’s directors and senior management. The terms of office of each of our directors expires on the date of the next annual meeting of our shareholders. The business address for our directors and senior management is 160 Elgin Street, Suite 2100, Ottawa, Ontario, Canada, K2P 2P7.

Name	Province/State<br>and Country<br>of Residence	Age as of<br>December 31,<br>2023	Position	Principal<br>Occupation for the<br>Last 5 Years
Directors*
Mr. Michael Boychuk(2)	Baie-D-Urfe, Quebec, Canada	68	Director	Corporate Director
Ms. Jane Craighead	Elizabethtown, Ontario, Canada	64	Director	Corporate Director Senior Vice President, Scotiabank
Mr. Richard Fadden	Ottawa, Ontario, Canada	72	Director	Corporate Director/Advisor
Mr. Daniel Goldberg	Ottawa, Ontario, Canada	58	Director	President and Chief Executive Officer, Telesat Canada
Mr. Henry Intven	Victoria, British Columbia, Canada	75	Director	President, Haro Strait Consulting Inc.
Mr. David Morin(2)	Montreal, Quebec, Canada	43	Director	Managing Director, Private Equity
Dr. Mark H. Rachesky(1)	New York, NY, USA	64	Director	Founder and Chief Investment Officer, MHR Fund Management LLC
Mr. Guthrie Stewart(2)	Westmount, Quebec, Canada	68	Director	Corporate Director Executive, PSP Investments
Mr. Michael B. Targoff(1)	Jupiter, FL, USA	79	Director	Vice Chairman, Loral Space & Communications Inc.
Janet Yeung(1)	New York, NY, USA	59	Director	Principal and General Counsel, MHR Fund Management LLC
Senior Management**
Mr. Daniel Goldberg	Ottawa, Ontario, Canada	58	President and Chief Executive Officer	President and Chief Executive Officer
Ms. Michèle Beck	Ottawa, Ontario, Canada	58	Senior Vice President, Canadian Sales	Senior Vice President, Canadian Sales, Vice President, North American Sales
Mr. Andrew Browne	Ottawa, Ontario, Canada	68	Chief Financial Officer	Chief Financial Officer, Telesat Chief Financial Officer, SES
Mr. Christopher S. DiFrancesco	Ottawa, Ontario, Canada	60	Vice President, General Counsel and Secretary	Vice President, General Counsel and Secretary
Mr. John Flaherty	Ottawa, Ontario, Canada	58	Vice President, Business Planning & Marketing	Vice President, Business Planning & Marketing
Mr. Philip Harlow	Hampton, VA USA	58	President, Telesat Government Solutions, Telesat U.S. Services, L.L.C.	President, Telesat Government Solutions, Telesat U.S. Services, L.L.C. Vice President, Global Solutions Group, SES Government Solutions President and Chief Operating Officer, XTAR, LLC
Mr. Glenn Katz	St. Albans, VT USA	61	Chief Commercial Officer	Chief Commercial Officer, Telesat, Senior Vice President and General Manager, Comcast

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Name	Province/State<br>and Country<br>of Residence	Age as of<br>December 31,<br>2023	Position	Principal<br>Occupation for the<br>Last 5 Years
Mr. Michael C. Schwartz	Tucson, AZ USA	59	Senior Vice President, Corporate & Business Development	Senior Vice President, Corporate & Business Development
Ms. France Teasdale	Chelsea, Quebec, Canada	56	Vice President, People	Vice President, People, Telesat Human Resources Director, Héroux-Devtek
Mr. David N. Wendling	Ottawa, Ontario, Canada	61	Chief Technical Officer	Chief Technical Officer

____________

(1) If such person is unable or unwilling to serve as Director, a replacement may be designated pursuant to the Investor Rights Agreement by and between MHR and Telesat Corporation.

(2) If such person is unable or unwilling to serve as Director, a replacement may be designated pursuant to the Investor Rights Agreement by and between PSP Investments and Telesat Corporation.

(3) Such Director serves as the Chief Executive Officer of Telesat Corporation.

* On August 2, 2023, Janet Yeung was appointed to the Board of Directors of Telesat Corporation replacing Jason Caloras who resigned effective the same day.

** Erwin Hudson, former Vice-President, Telesat Lightspeed System Development, retired effective June 30, 2023.

Our Directors

Michael T. Boychuk is a retired senior executive who, since his retirement in 2015, serves as a professional corporate director. He has been a professional Chartered Accountant since 1979 and was in 2012 made a fellow of the Order of Chartered Accountants of Quebec. Prior to his retirement, Mr. Boychuk held senior executive positions within the BCE group of companies, including President of Bimcor, BCE’s pension investment subsidiary and Senior Vice President and Corporate Treasurer of both BCE Inc. and Bell Canada. As a professional Chartered Accountant. Mr. Boychuk is deemed to be a financial expert, and currently serves on the boards of a number of public and private companies. He has been serving on boards for over 20 years and has extensive experience with audit committees as well as risk and governance and human resources. Mr. Boychuk brings to Telesat Corporation a wide array of financial and strategic expertise and knowledge of the satellite industry attained through his past experience at BCE Inc. and the other public companies he is associated with. He is currently a member of the following Boards of Directors: (Public) Laurentian Bank of Canada, GDI Integrated Facility Services Inc. and (Private) Cadillac Fairview Corporation and Finchley Pharmaceuticals Inc. Mr. Boychuk is also a Governor Emiritus of McGill University and previous chair of the university’s audit and pension committees.

Jane Craighead is a Chartered Professional Accountant (CPA) and a Chartered Accountant with over 20 years of international experience with public company boards, and over 30 years of experience in accounting and finance. She retired from Scotiabank in 2019 where she was Senior Vice President Global Human Resources for eight years. As a CPA, Ms. Craighead is deemed to be a financial expert. She is currently a member of the Board of Directors of Wajax Corporation where she is a member of the Audit Committee and chairs the Human Resources Committee and of Crombie Real Estate Investment Trust (REIT) where she is a member of the Human Resources Committee and chairs the Governance and Nominating Committee. Jane retired from the Jarislowsky Fraser board after five years at the end of 2023. She was a director of Intertape Polymer Group Inc. from 2020 until its privatization in July 2022 where she was chair of the Human Resources Committee and a member of the ESG Committee, and of Clearwater Seafoods Incorporated from 2015 until its privatization in 2021 where she served as the chair of the Human Resources Development and Compensation Committee, and a member of the Finance and Audit committees and the Special Committee for the sale process. She was also previously a director of Park Lawn Corporation where she served as chair of the Investment Committee and a member of the Audit Committee, HR Committee and Governance Committee. Ms. Craighead is Co-Vice Chair of the McGill University Hospital Centre (MUHC) Foundation and was Vice Chair of the Board of Regents of Mount Allison University from 2019 to 2021. She holds a PhD in Management from McGill University, has published research on executive compensation and corporate governance, and has been recognized as one of Canada’s Top 100 Most Powerful Women by the Women’s Executive Network.

Richard Fadden was the National Security Advisor to the Prime Minister of Canada from January 2015 to March 2016. Previously he was the Deputy Minister of National Defence starting in 2013 and served as the Director of the Canadian Security Intelligence Service from 2009 until 2013. Mr. Fadden has also served as the Deputy Minister

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for Citizenship and Immigration Canada from 2006 to 2009, the Deputy Minister of Natural Resources Canada from 2005 to 2006, President of the Canadian Food Inspection Agency from 2002 to 2005, and Deputy Clerk and Counsel in the Privy Council Office from 2000 to 2002, during which time he assumed the additional duties of Security and Intelligence Coordinator in February 2001. Earlier in his career, Mr. Fadden worked in a variety of positions throughout the GoC including in the Department of External Affairs, the Office of the Auditor General of Canada, Natural Resources Canada and the Treasury Board Secretariat. Since his retirement, he is a Strategic Advisor to Awz HLS Fund. He is also a member of L3 Harris’ Canadian Advisory Board and Vice chair of the Board of the Canadian Red Cross.

Daniel S. Goldberg became Telesat’s President and Chief Executive Officer in September 2006. Prior to September 2006, Mr. Goldberg served as Chief Executive Officer of SES New Skies, a position he held since March 2006 following the purchase of New Skies by SES. Mr. Goldberg served as the Chief Executive Officer of New Skies Satellites from 2002 to 2006 and prior to that as Chief Operating Officer of New Skies since February 2000. Prior to that time, he had served as New Skies General Counsel since 1998. Prior to joining New Skies, Mr. Goldberg worked at PanAmSat as the Associate General Counsel and Vice President of Government and Regulatory Affairs during 1998. From 1993 to 1997, he was an associate at Goldberg, Godles, Wiener & Wright, a law firm in Washington, D.C. Mr. Goldberg currently serves on the Board of Directors of Algonquin Power & Utilities Corp and is a former member of the Board of MDC Partners Inc. He received a Bachelor of Arts degree from the University of Virginia, graduating with highest honors, and a Juris Doctor degree, cum laude, from Harvard Law School.

Henry (Hank) Intven is President of Haro Strait Consulting Inc. For twenty-five years, he was a partner in the Toronto office of McCarthy Tétrault LLP, a leading Canadian law firm. He has held a number of senior advisory and executive positions with the Canadian Government and the Canadian Radio-television and Telecommunications Commission. Over the past 40 years, he has advised businesses and governments on many of the major commercial, regulatory and policy developments in the Canadian telecommunications industry. He has also advised on business, policy and regulatory matters involving the telecommunications industry in more than 20 other countries.

David Morin is Managing Director, Private Equity at PSP. Mr. Morin joined PSP in 2013 and has led a number of investments across industries and geographies with a focus on sourcing, execution, as well as asset management. Mr. Morin’s qualifications for service on the board of directors of Telesat Corporation include his significant experience with negotiation, corporate finance and operational matters, underpinned by his 20 years of investment and finance experience. Mr. Morin currently serves on the Board of Directors of American Wholesale Insurance Holding Company, LLC (Amwins), Convex Group Limited and Bon Topco SAS (HAVEA). Mr. Morin holds a bachelor’s degree from HEC Montréal and an MBA from INSEAD.

Mark H. Rachesky, M.D. is the Founder and Chief Investment Officer of MHR Fund Management LLC, a New York-based investment firm that takes a private equity approach to investing. MHR manages approximately US$5 billion of capital and has holdings in public and private companies in a variety of industries. He has been the Independent Chairman of the Board of Directors of Telesat Corporation since November 2021 and is a member of its Human Resources and Compensation Committee and Nominating and Corporate Governance Committee. Dr. Rachesky has been Chairman of the Telesat Canada Board of Directors since 2007 and from 2007 to 2021 was also a member of the Telesat Canada Compensation and Corporate Governance Committee. He was Non-executive Chairman of the Board of Directors of Loral from 2006 to 2021 and was Chairman of the Loral Compensation Committee and a member of the Loral Executive Committee. Dr. Rachesky is Non-executive Chairman of the Board of Directors of Lions Gate Entertainment Corp and a director of Titan International, Inc. He previously served on the Board of Directors of Navistar International Corporation and Emisphere Technologies, Inc. Dr. Rachesky holds an MBA from the Stanford University School of Business, an MD from the Stanford University School of Medicine and a BA in Molecular Aspects of Cancer from the University of Pennsylvania. Dr. Rachesky has demonstrated leadership skills as well as extensive financial expertise and broad-based business knowledge and relationships. In addition, Dr. Rachesky has significant expertise and perspective as a member of the board of directors of private and public companies engaged in a wide range of businesses.

Guthrie Stewart was, until his retirement in June 2021, an executive with global pension fund manager PSP Investments. Most recently, Mr. Stewart was Vice Chair Investment Committee from June 2020 to June 2021. Prior to that he was Executive Vice-President and Global Head of Private Investments overseeing PSP Investments global teams managing private equity and infrastructure from September 2015 to June 2020. He has been a Director of Telesat since 2016. Mr. Stewart has broad business and investing experience, including more than 12 years in

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telecommunications and more than ten years in investment management. For eight years until 2000, he was an executive with Teleglobe Inc., the listed shareholder of Teleglobe Canada (at the time Canada’s international telecom carrier), including two years as CEO and President of Teleglobe Canada. Teleglobe Canada had varied satellite investments, including as a member and distributor of Inmarsat and Intelsat, and also as founding investor in Orbcomm. Mr. Stewart was a partner in one of Canada’s largest mid- market buyout firms, EdgeStone Capital Partners, from 2001 until the end of 2007 following the sale of majority interest. He is a director of the global consulting firm Alix Partners, LLP. He holds an LL.B from Osgoode Hall (Toronto, Canada) and an M.B.A. from INSEAD in Europe. He also holds the ICD.D designation from the Canadian Institute of Corporate Directors. Through his career, he has participated as a Director on numerous private and public boards and as a member at various times of all major Committees.

Michael B. Targoff was Vice Chairman of Loral Space & Communications Inc. from November 21, 2005 to November 2021 and a consultant to Loral from December 15, 2012 to November 2021. Mr. Targoff was Chief Executive Officer of Loral from March 1, 2006 to December 14, 2012 and President of Loral from January 8, 2008 to December 14, 2012. Mr. Targoff was also a Director and member of the Audit Committee of Telesat Canada from the time that Loral acquired its interest in Telesat in October 2007 until November 2021. From 1998 to February 2006, Mr. Targoff was founder and principal of Michael B. Targoff & Co., a private investment company. Mr. Targoff’s qualifications for service on the board of directors of Telesat Corporation include his extensive understanding and knowledge of its business and the satellite industry, as well as demonstrated leadership skills and operating experience, acquired during more than 20 years of serving as a senior executive of Loral and its predecessors. As a current or former director of other public and private companies in the telecommunications industry, Mr. Targoff also brings to Telesat Corporation a broad-based business knowledge and substantial financial expertise.

Janet Yeung has been Principal and General Counsel of MHR Fund Management LLC, a New York-based private equity firm, since May 2012. Ms. Yeung currently serves on the boards of a number of private companies operating across a variety of industries. From May 2015 to November 2021, Ms. Yeung served as a director of Loral Space & Communications Inc. (Nasdaq). Ms. Yeung also served as a director of Navistar International Corporation (NYSE) and was a member of its Audit Committee and Compensation Committee from December 2020 until its acquisition by the Traton Group in July 2021. Ms Yeung holds a J.D., cum laude, from Georgetown University Law Center and an A.B. in Economics from Cornell University.

Our Senior Management

Daniel S. Goldberg (see section entitled “— Our Directors” above).

Michèle Beck joined Telesat in 1987 as a project engineer in the Broadband Development Group. In 1994, she joined the Canadian Cable Telecommunications Association as Director Engineering and was subsequently promoted to Vice President in 1996. In March 2006, Ms. Beck returned to Telesat as the Director, Engineering responsible for all satellite service offerings. In 2009, she became Director of North American Enterprise and Government Sales and in January 2013 was promoted to Vice President, North American Sales with a subsequent title change to Senior Vice President, Canadian Sales. She holds a Bachelor of Applied Science, Electrical Engineering from the University of Ottawa.

Andrew Browne was appointed Chief Financial Officer of Telesat in December 2019. Prior to that, he was the Chief Financial Officer of SES S.A. from February 2018 to September 2019, Chief Financial Officer of O3b Networks from 2013 to 2018, and Chief Financial Officer and member of the management board at SES from 2010 to 2013. Mr. Browne served as CFO of New Skies Satellites between 1998 and 2008, and as Chief Financial Officer and Deputy CEO of Intelsat between 1995 and 1998. Prior to Intelsat, he held Chief Financial Officer and board positions at a number of global companies and organizations specializing in the telecommunications, technology and financial sectors, SES Astra, O3b, Advanced Micro Devices, Tom Tom and the Development Bank of Ireland in Dublin. Mr. Browne has an MBA from Trinity College in Dublin, Ireland.

Christopher S. DiFrancesco became Telesat’s Vice President, General Counsel and Secretary in 2009. Prior to that, Mr. DiFrancesco served as Senior Vice President, Legal, General Counsel and Secretary of Corel Corporation, a position he held since 2006. From 2003 to 2006, he served as Corel Corporation’s Vice President, Legal, General Counsel and Secretary, and as Corporate Counsel from 2000 to 2003. From 1998 to 2000, he served as Associate Counsel for the National Hockey League Players’ Association. From 1989 to 1998, he was an Articling Student and then Associate with the law firm of Gowling Lafleur Henderson. He holds a Bachelor of Engineering Science in Mechanical Engineering and a Bachelor of Laws from the University of Western Ontario.

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John Flaherty joined Telesat in 1987, and since that time has held a variety of positions in Finance, Business Development and Marketing including the Director, South America from 2006 to 2007 and the Director, Planning and Marketing from 2007 to 2012. Mr. Flaherty was appointed Vice President, Business Planning & Marketing in 2013. He holds a Master of Business Administration from Queen’s University as well as a Bachelor of Arts, major in Economics from Carleton University.

Philip Harlow joined Telesat in December 2022 as President of Telesat Government Solutions. He most recently was the President and CEO of DTC Communications, where he was brought in to define the corporate strategy, team and technology infrastructure for short and long-term growth. Before that, he was the Vice President of the Global Solutions Group for SES Government Solutions, where he spearheaded business development capture activities and engineered trusted solutions for government and defence customers. From 2010 to 2018, he served as President and Chief Operating Officer of XTAR, LLC, designing innovative ways for military and government users to access commercial space platforms. Prior to XTAR, Mr. Harlow held a variety of executive and engineering roles with leading defense integrators and satellite operators, including Caprock Communications, DRS Technical Services, Intelsat General and Esatel Communications. Mr. Harlow holds a Bachelor of Engineering from the Royal Military College of Science and a Master of Science from George Washington University.

Glenn Katz joined Telesat in 2021 as Chief Commercial Officer. Before joining Telesat Mr. Katz was Senior Vice President and General Manager of Comcast Business Enterprise Solutions from 2014 to 2021. Previously he served as Chief Executive Officer of Spacenet Inc. a wholly owned subsidiary of Gilat Satellite Systems Ltd from 2012 to 2014, and as President and Chief Operating Officer from 2005 to 2012. Prior to Spacenet Mr. Katz was CEO and Chief Information Officer of Starband Inc. a wholly owned subsidiary of Gilat Satellite Systems from 2004 to 2005. From 1997 to 2004 Mr. Katz served in various Executive rolls for Gilat Satellite Networks around the world including Vice President of Customer Services, Chief Technical Officer of Gilat Latin America, Inc., and Vice President of Product Development for Gilat Florida Inc. From 1987 to 1997 Mr. Katz served in various R&D rolls for Gilat Satellite Networks Ltd, Scientific Atlanta Inc., and Digital Transmission Systems. Mr. Katz holds a Bachelor of Engineering and a Masters of Science in Electrical Engineering from the Georgia Institute of Technology in Atlanta, Georgia.

Michael C. Schwartz rejoined Telesat in 2015 as Senior Vice President, Corporate & Business Development. From 2013 to 2015, he served as Senior Vice President, Corporate Strategy and Development with Sprint Corporation, after having served as Vice President, Marketing, Corporate Development & Regulatory of Telesat from 2007. Mr. Schwartz joined Telesat from SES New Skies, where he served as Senior Vice President of Marketing and Corporate Development, a position he held since 2006 following the purchase of New Skies Satellites by SES. Prior to that, Mr. Schwartz served in the same position for New Skies Satellites since 2003. Prior to joining New Skies Satellites, he served as Chief Development and Financial Officer of Terabeam Corporation, responsible for business and corporate development as well as financial operations. Prior to Terabeam Corporation, he was a co-founder and President of an Internet infrastructure company, which was sold in 2000. He also held two senior positions at AT&T Wireless Services, most recently as Vice President of Acquisitions and Development. Mr. Schwartz graduated magna cum laude from Harvard University in physics and magna cum laude from Harvard Law School.

France Teasdale joined Telesat in 2022 as Vice President, People. Before joining Telesat, Ms. Teasdale served as Human Resources Director for the Landing Gear division of Montreal-based Héroux-Devtek in the U.S. and Ontario from 2014 to 2022. Based out of Cleveland, Ohio, she was responsible for implementing and managing all people-related services, policies and programs for the company’s Central Region business units. Prior to Héroux-Devtek, she was Director, Human Resources with Mecanica Solutions in Montreal. Ms. Teasdale holds a Bachelor degree in Mechanical Engineering from Ecole Polytechnique in Montreal as well as a Bachelor degree in Management from HEC Montreal.

David N. Wendling joined Telesat in 1986, and has held a variety of key positions within the Space Systems Department prior to being appointed Vice President, Space Systems in 2007 with a title change to Vice President Space and Network Engineering in 2008 and to Chief Technical Officer in 2013. Mr. Wendling holds a Bachelor of Applied Science from the University of Waterloo. He is registered as a Professional Engineer with the Professional Engineers of Ontario.

There is no family relationship among our directors and senior management.

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B. Compensation

Overview

We operate in a dynamic and rapidly evolving global market. To succeed in this environment and to achieve our business and financial objectives, we need to attract, retain and motivate a highly talented team of executive officers, available on a limited basis internationally. Key talents include strong leadership and management capabilities that are suited to our culture and the evolving nature of our industry. global telecommunications experience, and advanced space and network engineering experience. Our executive officers demonstrate a proven ability to successfully lead and manage our growth and operational objectives in a dynamic and evolving market. They are also key to inspiring a culture of operational excellence which is at the foundation of our success and our continued ability to foster ongoing growth.

Our executive officer compensation program is designed to achieve the following objectives:

• provide market-competitive compensation opportunities in order to attract and retain talented, high- performing and experienced executive officers, whose knowledge, skills and performance are critical to our success;

• motivate our executive officers to achieve our business and financial objectives;

• align the interests of our executive officers with those of our shareholders by tying a meaningful portion of compensation directly to the long-term value and growth of our business; and

• provide incentives that encourage appropriate levels of risk-taking by our executive officers and provide a strong pay-for-performance relationship.

Prior to completion of the Transaction and becoming a publicly traded company, we offered our executive officers cash compensation in the form of base salary, an annual bonus and, following a year in which we made distributions to shareholders, a special bonus in lieu of an adjustment to equity-based compensation for such distributions. We also offered our executive officers an equity-based or equity-like compensation which was historically awarded in the form of Telesat Options and Telesat Tandem SARs under the 2008 Telesat Plan and 2013 Telesat Plan. In the first half of 2021, we also adopted a restricted share unit plan (the “RSU Plan”) to provide another form of equity compensation to award our executive officers. See “— Long Term Incentives — Historic Plans”.

In connection with completion of the Transaction and becoming a public company, holders of existing equity incentive awards under the Historic Plans were afforded the opportunity to exchange those awards for corresponding equity incentive awards of Telesat Corporation. We also amended and restated our Historic Plans to, among other things, (i) give effect to the changes in our corporate structure resulting from the Transaction; and (ii) include terms and conditions required by the TSX and NASDAQ for equity compensation plans, such as provisions and restrictions relating to amendment of the Historic Plans or outstanding awards. As of the Transaction date, no further awards to executives or employees will be made under the Historic Plans. All equity compensation awards are made pursuant to our Omnibus Plan (as defined below under “Long Term Incentives — Omnibus Long Term Incentive Plan”) that we adopted in connection with completion of the Transaction.

We believe that equity-based compensation awards motivate our executive officers to achieve our business and financial objectives, and also align their interests with the long-term interests of our shareholders. We provide base salary to compensate executive officers for their day-to-day responsibilities, at levels that we believe are necessary to attract and retain executive officer talent. While we have determined that our current executive officer compensation program is effective at attracting and maintaining executive officer talent, we evaluate our compensation practices on an ongoing basis to ensure that we are providing market-competitive compensation opportunities for our executive team.

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Long Term Incentives

Omnibus Long Term Incentive Plan

In connection with becoming a publicly traded company, we adopted a new long-term equity incentive plan (the “Omnibus Plan”) to allow for a variety of equity based awards that provide different types of incentives to be granted to certain of our directors, executive officers, employees and/or consultants (including options (“Telesat Corporation Options”), performance share units (“Telesat Corporation PSUs”), restricted share units (“Telesat Corporation RSUs”) and deferred share units (“Telesat Corporation DSUs”). Telesat Corporation Options, Telesat Corporation PSUs, Telesat Corporation RSUs and Telesat Corporation DSUs are collectively referred to herein as “Awards”. Each Award will represent the right to receive Telesat Public Shares or, in the case of Telesat Corporation PSUs, Telesat Corporation RSUs and Telesat Corporation DSUs, Telesat Public Shares or cash, in accordance with the terms of the Omnibus Plan. The following discussion is qualified in its entirety by the text of the Omnibus Plan, which is available on SEDAR+ at https://www.sedarplus.ca.

Under the terms of the Omnibus Plan, the Telesat Corporation Board, or if authorized by the Telesat Corporation Board, the applicable Telesat Corporation Board committee, may grant Awards to eligible participants, as applicable. Participation in the Omnibus Plan is voluntary and, if an eligible participant agrees to participate, the grant of Awards will be evidenced by a grant agreement with each such participant. The interest of any participant in any Award is not assignable or transferable, whether voluntary, involuntary, by operation of law or otherwise, other than by will or the laws of descent and distribution.

The Omnibus Plan provides that appropriate adjustments, if any, will be made by the Telesat Corporation Board in connection with a reclassification, reorganization or other change of our shares, share split or consolidation, distribution, merger, arrangement or amalgamation, in the Telesat Public Shares issuable or amounts payable to preclude a dilution or enlargement of the benefits under the Omnibus Plan.

The maximum number of Telesat Public Shares reserved for issuance under our Omnibus Plan is 2,972,816 Telesat Public Shares, which represents 6% of the estimated aggregate number of Telesat Corporation Shares issued and outstanding upon completion of the Transaction, on a diluted basis assuming the exchange of all Telesat Partnership Units into Telesat Corporation Shares (not including any awards outstanding under the Historic Plans). For the purposes of calculating the maximum number of Telesat Public Shares reserved for issuance under the Omnibus Plan and the Historic Plans, any issuance from treasury by Telesat that is issued in reliance upon an exemption under applicable stock exchange rules applicable to equity-based compensation arrangements used as an inducement to person(s) or company(ies) not previously employed by and not previously an insider of Telesat shall not be included. All of the Telesat Public Shares covered by Awards that are exercised or settled in cash or cancelled or terminated will again become available Telesat Public Shares for the purposes of Awards that may be subsequently granted under the Omnibus Plan.

The maximum number of Telesat Public Shares that are: (i) issued to insiders of Telesat within any one-year period; or (ii) issuable to insiders of Telesat at any time, in each case, under the Omnibus Plan alone, or when combined with all of Telesat’s other security-based compensation arrangements cannot exceed 10% of the aggregate number of Telesat Corporation Shares issued and outstanding from time to time, on a diluted basis assuming the exchange of all Telesat Partnership Units into Telesat Corporation Shares.

A Telesat Corporation Option shall be exercisable during a period established by the Telesat Corporation Board which shall commence on the date of the grant and shall terminate no later than ten years after the date of the granting of the Telesat Corporation Option or such shorter period as the Telesat Corporation Board may determine. The minimum exercise price of a Telesat Corporation Option will be determined based on the closing price of the Telesat Public Shares on the last trading day before the date such option is granted. The Omnibus Plan will provide that the exercise period shall automatically be extended if the date on which it is scheduled to terminate shall fall during a black-out period. In such cases, the extended exercise period shall terminate 10 business days after the last day of the black-out period. In order to facilitate the payment of the exercise price of the options, the Omnibus Plan has a cashless exercise feature pursuant to which either a broker assisted “cashless exercise” or an “option surrender” subject to the procedures set out in the Omnibus Plan, including the consent of the Telesat Corporation Board, where required.

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The following table describes the impact of certain events upon the rights of holders of Telesat Corporation Options under the Omnibus Plan, including termination for cause, resignation, retirement and termination other than for cause, and death or long-term disability, subject to the terms of a participant’s employment agreement and grant agreement or as otherwise determined by the Telesat Corporation Board in its sole discretion:

Event	Provisions
Termination for cause	Immediate forfeiture of all vested and unvested options.
Resignation, retirement and termination other than for cause	Forfeiture of all unvested options and expiry of vested options the earlier of the original expiry date and 90 days after resignation, retirement or termination.
Long-term disability	Forfeiture of all unvested options and expiry of vested options the earlier of the original expiry date and 12 months after date of long-term disability.
Death	Continued vesting of unvested options for a period of 12 months and expiry of vested options, including those that vest during such 12 month period, the earlier of the original expiry date and 12 months after date of death.

The terms and conditions of grants of Telesat Corporation RSUs, Telesat Corporation PSUs and Telesat Corporation DSUs, including the quantity, type of award, grant date, vesting conditions, vesting periods, termination provisions, settlement date and other terms and conditions with respect to these Awards, will be set out in the participant’s grant agreement.

In connection with a change of control event of Telesat Corporation, the Telesat Corporation Board may take such action as the Telesat Corporation Board in its sole discretion considers appropriate in the circumstances, including, without limitation, (i) changing the vesting or manner of settlement of any Award, (ii) changing the expiry date or term of any Award, (iii) providing for the substitution or replacement of Awards, including with awards of the surviving entity, or (vi) providing for the cancellation of Awards, provided that all Awards to be so cancelled will first vest and become exercisable prior to such change of control event in accordance with the provisions of the Omnibus Plan.

The Telesat Corporation Board may, in its sole discretion, suspend or terminate the Omnibus Plan at any time, or from time to time, amend, revise or discontinue the terms and conditions of the Omnibus Plan or of any Award granted under the Omnibus Plan and any grant agreement relating thereto, subject to compliance with applicable law and any required shareholder, regulatory and/or NASDAQ, and, if applicable the TSX, approval, provided that any such amendment or revision may not materially adversely affect the rights of a participant under the Omnibus Plan without such participant’s consent.

Pursuant to the terms of the Omnibus Plan, shareholder approval shall not be required for the following amendments, and the Telesat Corporation Board may make any amendments to the Omnibus Plan or to any Awards from time to time which may include but are not limited to:

• any amendment to the vesting provisions, if applicable, or assignability provisions of Awards;

• any amendment regarding the effect of termination of a participant’s employment, engagement, contract or office;

• any amendment which accelerates the date on which any Award may be exercised under the Omnibus Plan;

• any amendment to the definition of persons eligible to be participants under the Omnibus Plan;

• any amendment to add provisions permitting for the granting of cash-settled awards, a form of financial assistance, or clawback and any amendment to a cash-settled award, financial assistance, dividend equivalent or clawback provision which is adopted;

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• any amendment necessary to comply with applicable law or the requirements of the NASDAQ, and, if applicable the TSX, or any other regulatory body;

• any amendment of a “housekeeping” nature, including, without limitation, to clarify the meaning of an existing provision of the Omnibus Plan, correct or supplement any provision of the Omnibus Plan that is inconsistent with any other provision of the Omnibus Plan, correct any grammatical or typographical errors or amend certain definitions in the Omnibus Plan;

• any amendment regarding the administration of the Omnibus Plan; and

• any other amendment that does not require the approval of shareholders pursuant to the amendment provisions of the Omnibus Plan, provided that the alteration, amendment or variance does not: (i) increase the maximum number of Telesat Public Shares issuable under the Omnibus Plan, other than an adjustment pursuant to a change in capitalization; (ii) reduce the exercise price or purchase price, as applicable, of Awards; (iii) extend the expiration date of an Award benefitting an insider, except in the case of an extension due to a black-out period; (iv) remove or exceed the insider participation limits; (v) permit the transferability or assignability of Awards, except as otherwise provided in the Omnibus Plan; or (vi) amend the amendment provisions of the Omnibus Plan.

As at December 31, 2023 there were 803,265 stock options, 784,725 restricted share units, 375,137 performance share units and 124,616 deferred share units issued and outstanding under the Omnibus Plan.

Historic Plans

Telesat Holdings Inc. (the predecessor entity to Telesat and Telesat Corporation), adopted a management stock incentive plan in September 2008, as amended (the “2008 Telesat Plan”), a second management stock incentive plan in April 2013, as amended (the “2013 Telesat Plan”) and in April 2021 adopted an RSU Plan (the “RSU Plan” and together with the 2008 Telesat Plan and the 2013 Plan, the “Historic Plans”).

Types of Awards under Historic Plans

Telesat Options

The Historic Plans provided that, unless otherwise specified in the grant agreement or employment agreement of a participant, the Telesat Options granted to any participant would vest as to 20% each year over five years.

The exercise price of any Telesat Option granted under the Historic Plans was fixed by the board of directors of Telesat Canada (the “Telesat Board”) when Telesat Options were granted, at not less than fair market value, based on a reasonable valuation method, consistently applied in good faith by the Telesat Board, on the grant date, but in any event, not less than $11.07 (per Telesat Canada share). The Historic Plans provide that a Telesat Option shall be exercisable during a period established by the Telesat Board which shall commence on the date of the grant and shall terminate no later than ten years after the date of the granting of the option or such shorter period as the Telesat Board may determine. However, in 2018 the Telesat Board and Telesat Compensation Committee determined it would be in the best interests of Telesat to extend the expiry date of Telesat Options issued pursuant to the 2008 Telesat Plan by five years. The result is that such Telesat Options now expire 15 years from the grant date.

Telesat Stock Appreciation Rights

A Telesat stock appreciation right (“SAR”) entitled the recipient to receive Non-Voting Participating Preferred Shares of Telesat, which were convertible at the option of the holder into Telesat Common Shares, cash or other property equal in value to the appreciation of the Telesat Common Shares over the stated exercise price. The exercise price per Telesat Common Share for each SAR was determined by the Telesat Canada Compensation Committee, but (except as subject to adjustment by the Telesat Canada Compensation Committee) may not be less than 100% of the fair market value of a Telesat Common Share on the date the Telesat SAR was granted. The Telesat Compensation Committee may determine the vesting schedule and expiration dates for the Telesat SARs. To date, there has not been any grants of any standalone Telesat SARs and there will not be any grant of Telesat SARs going forward.

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The Historic Plans also provided for the issue of tandem share appreciation right (referred to as “Telesat Tandem SARs”) which may be granted in connection with Telesat Options granted under the Historic Plans, at or after the time of grant of such Telesat Options. Telesat Tandem SARs entitle the recipient to surrender to Telesat, unexercised, the right to subscribe for a Non-Voting Participating Preferred Shares pursuant to the related Telesat Option and to receive from Telesat Canada cash or Non-Voting Participating Preferred Shares in an amount equal to the excess of the market value of a Telesat Option over the exercise price under the related Telesat Option, net of any applicable withholding taxes and other required source deductions. Telesat Tandem SARs were only awards to certain executive officers and no further Telesat Tandem SARs will be granted under the Historic Plans.

The Telesat Board and Telesat Compensation Committee awarded Telesat Tandem SARs only to certain executive officers of Telesat.

Telesat Restricted Share Units

A Telesat restricted share unit (“RSU”) entitled the recipient to receive Non-Voting Participating Preferred Shares of Telesat Canada, which were convertible at the option of the holder into Telesat Common Shares, cash or other property equal in value to of the Telesat Common Shares.

Conversion of Awards under Historic Plans

In connection with the completion of the Transaction, each holder of Telesat Options, Telesat Tandem SARs and Telesat RSUs pursuant to the Historic Plans was provided with the option to enter into an exchange agreement with Telesat Corporation in respect of his or her Telesat Options, Telesat Tandem SARs and Telesat RSUs (the “Optionholder Exchange Agreements”). Pursuant to the Optionholder Exchange Agreements, each holder of the Telesat Options, Telesat Tandem SARs and Telesat RSUs had the right to exchange his or her Telesat Options, Telesat Tandem SARs and Telesat RSUs for corresponding options, restricted share units and tandem share appreciation rights, as applicable, of Telesat Corporation. The corresponding incentive securities have similar vesting terms as the Telesat Options, Telesat Tandem SARs and Telesat RSUs, however, the number of underlying Telesat Public Shares and exercise prices, as applicable, were adjusted to take into consideration the Telesat-to-Telesat Corporation Exchange Ratio. In connection with the completion of the Transaction certain necessary modifications and amendments were made to the Historic Plans and RSU Plan to meet the requirements of the NASDAQ and TSX, including amendments (i) to give effect to the changes in our corporate structure contemplated by the Transaction; and (ii) include provisions and restrictions relating to amendment of the Historic Plans and RSU Plan or outstanding awards thereunder.

Defined Benefit and Supplemental Retirement Plans for Designated Employees

We sponsor two non-contributory defined benefit pension arrangements for our executives located in Canada: (i) the “Pension Plan for Designated Employees of Telesat Canada,” which is a registered pension plan as defined in the Income Tax Act; and (ii) a supplemental employee retirement pension that covers pension benefits in excess of the tax limits imposed on the registered pension plan.

Both pension programs provide for an annual pension based on service and final average earnings, and include survivor benefits. The pension can commence without reduction as early as age 60 or 35 years of service. Earlier retirement is possible with a reduction of ¼% for each month before the unreduced retirement date. Pensions are indexed to 50% of the consumer price index for each year.

Our executives located solely in the U.S. participate in our 401(k) plan available to our U.S.-based employees.

Summary Compensation Table

The following table sets out information concerning the compensation earned by, paid to, or awarded to our NEOs in the year ended December 31, 2023. The value of the Share-based Awards has been calculated based upon the share price as at the date of grant.

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The actual number of Share-based Awards that will vest and the value that will be realized will depend on the Telesat Corporation’s future share price as reflected on the TSX and NASDAQ.

				Non-equity IncentivePlan Compensation()
Name and Principal Position	Fiscal<br>Year	Salary(1)<br>($)	Share-<br>based<br>Awards(3)<br>($)	Option-BasedAwards(4)()	Long-<br>term<br>incentive<br>plans<br>($)	Pension<br>Value<br>($)	All Other<br>Compensation(5)(7)(8)<br>($)	Total<br>Compensation<br>($)
Daniel S. Goldberg,	2023	1,427,856	3,962,128	1,506,877	525,003	821,000	907,029	11,458,736
President and Chief Executive Officer(6)
Andrew Browne,	2023	752,081	943,341	358,778	125,023	13,000	132,772	3,541,110
Chief Financial Officer
Michael Schwartz,	2023	726,445	754,682	287,023	100,009	—	29,118	3,073,803
Senior Vice President, Corporate & Business Development
David Wendling,	2023	430,560	754,682	287,023	100,009	152,000	29,400	2,171,403
Chief Technical Officer
Glenn Katz,	2023	694,404	754,682	287,023	100,009	139,000	502,854	3,151,683
Chief Commercial Officer

All values are in US Dollars.

____________

Notes:

(1) Mr. Schwartz was paid in U.S. dollars and converted to Canadian dollars based on an average exchange rate for 2023 of $1.3493 to US$1.00. All other NEOs were paid in Canadian dollars. Represents total base salary payable in fiscal year 2023.

(2) Annual bonuses are earned and measured with reference to Adjusted EBITDA performance for a fiscal year. When the annual budget and Adjusted EBITDA targets are established for the upcoming fiscal year, the Compensation Committee establishes performance targets connected to the Adjusted EBITDA targets. The key metrics followed by Telesat in the most recent years were:

Adjusted EBITDA Performance	Performance Bonus
<95% of target amount	Nil
95% of target amount	Bonus equal to 50% of Target Bonus
97.5% of target amount	Bonus equal to 75% of Target Bonus
100% of target amount	Bonus equal to 100% of Target Bonus
102.5% of target amount	Bonus equal to 150% of Target Bonus
≥105% of target amount	Bonus equal to 200% of Target Bonus

The Human Resources & Compensation Committee also has the discretion to consider unforeseen events and make additional one-time adjustments in the event it determines such adjustments are warranted in the circumstances to ensure NEOs are not penalized for events outside of their control, including changes in foreign exchange rates or other one-time, non-reoccurring items or to take into account significant achievements that may be unrelated to Adjusted EBITDA performance. We currently make bonus payments in cash and anticipate continuing to do so in the future.

(3) The value attributed to the Share-based Awards in 2023 of $11.89 was derived from the Telesat Corporation share price on the NASDAQ on date of grant, converted into Canadian dollars and multiplied by the number of RSUs and PSUs granted.

(4) The value attributed to the Option-based Awards in 2023 is calculated using Black Scholes methodology, which results in a value of $6.10 per Option, multiplied by the number of Options granted and was derived from the Telesat Corporation share price on the NASDAQ on date of grant, converted into Canadian dollars, which was $11.89.

(5) These amounts include all other compensation paid to a NEO during the course of the year, including medical insurance coverage, special bonuses, perquisites, tax equalization payments and relocation payments, as applicable.

(6) All compensation paid to Mr. Goldberg is in consideration of his service as President and Chief Executive Officer of Telesat. He does not receive any compensation as a Director of Telesat.

(7) Includes a $750,000 tax equalization payment to Mr. Goldberg pursuant to his employment agreement to compensate him for the additional tax costs incurred as a result of living in Ontario, Canada as opposed to the U.S.

(8) Includes a payment of US$270,000 to Mr. Katz to compensate for equity from his prior employment that would have vested had he not terminated his prior employment to join Telesat.

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Outstanding Option-Based Awards and Share-Based Awards

The following table sets out information concerning the option-based and share-based awards granted to our NEOs outstanding as at December 31, 2023:

	Option-based Awards				Shared-based Awards
Name and Principal Position	Number of<br>Common<br>Shares<br>underlying<br>unexercised<br>options(1)	Option<br>exercise<br>price<br>($)	Option<br>expiration<br>date	Value of<br>unexercised<br>in-the- money<br>options(1)<br>($)	Number of<br>Shares<br>that have<br>vested	Number of<br>Shares that<br>have not<br>vested	Market or<br>payout<br>value of<br>share-<br>based<br>awards <br>that<br>have not<br>vested(1)<br>($)
Daniel S. Goldberg	360,442	11.89 to 16.64	April 2032 to May 2033	476,766	—	801,512	11,076,896
President and Chief Executive Officer
Andrew Browne	85,819	11.89 to 16.64	April 2032 to May 2033	113,515	—	145,207	2,006,761
Chief Financial Officer
Michael Schwartz	68,655	11.89 to 16.64	April 2032 to May 2033	90,812	—	132,019	1,824,503
Senior Vice President, Corporate & Business Development
David Wendling	68,655	11.89 to 16.64	April 2032 to May 2033	90,812	41,360	103,757	1,433,922
Chief Technical Officer
Glenn Katz	68,655	11.89 to 16.64	April 2032 to May 2033	90,812	—	83,077	1,148,124
Chief Commercial Officer

____________

Notes:

(1) The closing share price per the TSX as of December 31, 2023 was $13.82.

Incentive Plan Awards — Value Vested or Earned During the Year

The following table indicates, for each of our NEOs, a summary of the value of the option-based and share-based awards vested in accordance with their terms during the year ended December 31, 2023:

Name and Principal Position	Option-Based <br>Awards – Value<br>Vested During <br>the Year<br>($)	Share-Based <br>Awards – Value<br>Vested During <br>the Year<br>($)	Non-equity <br>incentive plan<br>compensation – Value<br>earned during <br>the year<br>($)
Daniel S. Goldberg,	—	3,755,820	—
President and Chief Executive Officer
Andrew Browne,	—	671,956	—
Chief Financial Officer
Michael Schwartz,	—	756,686	—
Senior Vice President, Corporate & Business Development
David Wendling,	—	366,092	—
Chief Technical Officer
Glenn Katz,	—	80,294	—
Chief Commercial Officer

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Defined Benefits Plan Table

Telesat maintains a defined benefit pension plan for certain of its employees, including certain NEOs. Benefits under this defined benefit plan are based on the employee’s years of service and the plan’s benefit formula.

Benefits under the defined benefit pension plan are calculated by adding (i) ¼% of the three-year average of the annual maximum pensionable earnings (which was $66,600 for 2023); and (ii) 2.0% of the three year average earnings in excess of the annual maximum pensionable earnings. For the purposes of this formula, earnings include the annual salary and 75% of the lesser of actual or target performance incentive for the specific year.

In respect of the NEOs, below is a table related to Telesat’s defined benefit plan:

Name and Principal Position	Number of <br>years of <br>credited<br>service(1)<br>(#)	Annual benefits payable ()	Opening <br>present<br>value of <br>defined<br>benefit<br>obligation<br>($)	Compensatory<br>change<br>($)	Non- <br>compensatory<br>change(2)<br>($)	Closing <br>present<br>value of <br>defined<br>benefit<br>obligation<br>($)
		At year end(1)
Daniel S. Goldberg,	17.3	826,000	12,658,000	821,000	1,747,000	15,226,000
President and Chief Executive Officer
Andrew Browne,	4.1	101,000	777,000	13,000	423,000	1,213,000
Chief Financial Officer
Michael Schwartz,	10.8	249,000	3,856,000	—	254,000	4,110,000
Senior Vice President, Corporate & Business Development
David Wendling,	31.3	355,000	5,028,000	152,000	657,000	5,837,000
Chief Technical Officer
Glenn Katz,	2.2	41,000	168,000	139,000	308,000	615,000
Chief Commercial Officer

All values are in US Dollars.

____________

Notes:

(1) As at December 31, 2023.

(2) Non-compensatory changes include interest on liabilities and impact of any assumption changes. The values shown are estimated based on assumptions and represent entitlements that may change over time.

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DIRECTOR COMPENSATION

Telesat Corporation has implemented a director compensation program that attracts and retains global talent to serve on the Telesat Corporation Board, taking into account the risks and responsibilities of being an effective director. Our objective regarding director compensation is to follow the best practices with respect to retainers and the format and weighting of the cash and equity components of compensation, and the implementation of share ownership guidelines. We believe the selected approaches have helped attract, and will help to attract and retain, strong members for the Telesat Corporation Board who will be able to fulfill their fiduciary responsibilities without competing interests. The Telesat Corporation Board, through the Nominating & Corporate Governance Committee (“NCGC”), will be responsible for reviewing and approving any changes to the directors’ compensation arrangements.

Following best practice, Telesat does not offer a meeting fee for directors. The total non-executive director retainer is deemed to be full payment for the role of director. The exception to this approach would be in the event of a merger or acquisition, or other special circumstance that required more meetings than are typically required, in which case a “special” fee may be granted. Also, an additional retainer premium is provided to the chair and each of the members of the Audit Committee, the Human Resources & Compensation Committee (“HRCC”) and NCGC, as well as the lead director, to the extent one is appointed, to reflect the additional time commitment, level of responsibility and skills required in such role.

The fee schedule for Telesat’s non-executive directors is as follows:

Type of Fee	Position	Amount(1)
Board Retainer	Board Member	$	75,000
		$	100,000 Telesat Corporation DSU Award(2)
Committee Retainer	Audit Committee Chair	$	25,000
	Audit Committee Member	$	10,000
	HRCC Chair	$	15,000
	HRCC Member	$	7,500
	NCGC Chair	$	15,000
	NCGC Member	$	7,500
	Lead Director		N/A
Meeting Fees	Board and Committee Meetings		Nil

____________

(1) All fees are paid in cash unless otherwise noted.

(2) Represents the portion of the directors’ annual retainer initially taken as Telesat Corporation DSUs (as defined herein). Any non-executive director may elect to receive up to 100% of their annual retainer in the form of DSUs in lieu of cash. All DSU awards are payable upon cessation of membership on the Telesat Corporation Board.

All directors are entitled to be reimbursed for expenses reasonably incurred by them in their capacity as directors.

C. Board Practices

Composition of our Board of Directors

Under the Telesat Corporation Articles and the Investor Rights Agreements, for so long as either PSP Investments or MHR (or, if applicable, a person to whom PSP Investments or MHR has delegated its right to designate directors to the Telesat Corporation Board under the Telesat Corporation Articles), is a 5% Holder, the Telesat Corporation Board will consist of ten directors, unless a change to the number of directors of the Telesat Corporation Board is approved by a majority of the Specially Designated Directors then in office (in addition to being approved by PSP Investments or MHR as required under their respective Investor Rights Agreements and the Telesat Corporation Articles, if applicable).

The Telesat Corporation Board consists of the Chief Executive Officer of Telesat Corporation, three directors designated by PSP Investments and its affiliates, three directors designated by MHR and its affiliates, and three independent directors who are unaffiliated with MHR and PSP Investments designated by the NCGC, each of whom must qualify as a Specially Designated Director. The number of directors may be altered by resolution of the shareholders or as adjusted by the Telesat Corporation Board from time to time, subject to the provisions of the BCBCA.

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Until the Special Nomination Termination Date, any designee of the NCGC may be rejected by the Telesat Corporation Board only for Good Cause (as defined in the Telesat Corporation Articles), in which case the NCGC shall have the right to designate a substitute designee.

Following the Special Nomination Termination Date, approval of the Telesat Corporation Board will be required for the appointment of three of the designees proposed by the NCGC, though until the Special Board Date, such approval is not to be unreasonably withheld and approval of at least a majority of the Specially Designated Directors then in office, not to be unreasonably withheld, will also be required. In addition, for purposes of Telesat Corporation’s annual meeting of shareholders to be held in calendar year 2025, three of the designees proposed by the NCGC may instead be designated by a subset of its members selected by the Telesat Corporation Board, with any such subset of the members of the NCGC to be selected by the Telesat Corporation Board and to include at least the three members required to be appointed to the Nominating & Corporate Governance Committee under the Telesat Corporation Articles.

Pursuant to the Investor Rights Agreements, if PSP Investments or MHR, respectively, decreases their respective aggregate ownership of Telesat Corporation Shares and Telesat Partnership Units at any time such that it owns less than 25%, 15% or 5%, respectively, of all of the issued and outstanding Telesat Corporation Shares and Telesat Partnership Units as of the Closing, the number of directors which such party is entitled to designate to the Telesat Corporation Board will decrease to two, one and zero, respectively. The number of independent directors that the NCGC may designate to the Telesat Corporation Board will be increased by one each time the number of designees PSP Investments or MHR (or, if applicable, a person to whom PSP Investments or MHR has delegated its right to designate directors to the Telesat Corporation Board under the Telesat Corporation Articles) is entitled to designate is reduced by one, until there are no such designees. In general, such independent directors must be Canadian.

Directors of Telesat Corporation may only be removed with an affirmative vote of at least 75% of the votes attached to the outstanding Telesat Corporation Shares and Special Voting Shares, voting together as a single class. However, if PSP Investments or MHR (or one of its respective assignees, if applicable) provides written notice to Telesat Corporation that one of the directors that it had designated to the Telesat Corporation Board will resign, the delivery of such notice will be deemed such designator’s resignation.

Such resignation will be effective immediately upon receipt of such written notice by Telesat Corporation without consent or acceptance of the Telesat Corporation Board or any of its shareholders.

The Telesat Corporation Board has established three committees in accordance with the terms of the Telesat Corporation Articles: the Audit Committee, the NCGC, and the HRCC (each as defined below). See the remainder of this section and “— Committees of the Telesat Corporation Board” for a further description of the committees.

Canadian Director and Committee Member Requirements

The Telesat Corporation Articles include certain requirements of directors of Telesat Corporation, so Telesat Corporation may maintain its status as a Canadian (for the purposes of this section, as defined in the Investment Canada Act) controlled entity. These requirements include that, prior to the occurrence of an Unwind Trigger, at least a majority of the Telesat Corporation Board be comprised of directors who are both (i) Canadian (as defined in the Investment Canada Act) and (ii) nominated for election by either: (x) the NCGC, if comprised of a majority of Canadian directors, (y) PSP Investments, or its affiliates, or (z) a shareholder who is Canadian.

Additionally, until the occurrence of an Unwind Transaction, at least a majority of the directors serving on each of the Audit Committee, the NCGC, the HRCC and any other committee formed in accordance with the Telesat Corporation Board, is required to be both (i) Canadian and (ii) nominated for election by either: (x) the NCGC, if comprised of a majority of Canadian directors, (y) PSP Investments, or its affiliates, or (z) a shareholder who is Canadian; provided that no committee member designated by MHR (or its assignee, if applicable) shall be required to be Canadian.

Nomination Rights of Principal Shareholders

As described above, under the Investor Rights Agreements, Telesat Corporation’s principal shareholders, namely PSP Investments and MHR and their affiliates, are each granted a right to nominate three directors to the Telesat Corporation Board. Further, so long as the applicable principal shareholder has the right to designate at least

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one director to the Telesat Corporation Board, it will have the right, though not the obligation, to select one of the directors it designated to the Telesat Corporation Board to serve on or be an observer to Telesat Corporation’s Audit Committee, Compensation Committee, and NCGC or any other committee which may be formed in accordance with Telesat Corporation’s Articles (provided that the mandate of such committee is not solely to consider any contract or transaction between Telesat Corporation and the applicable principal shareholder or any of its affiliates).

Pursuant to the Investor Rights Agreements, PSP Investments and MHR agree, among other things, to not (i) call or knowingly facilitate the calling of a special meeting of the shareholders of Telesat Corporation or the partners of Telesat Partnership for the purpose of the election or removal of any directors of Telesat Corporation or amendments to the Telesat Corporation Articles or the Partnership Agreement, (ii) initiate proposals for action by the shareholders of Telesat Corporation or the partners of Telesat Partnership for the purpose of the election or removal of any directors of Telesat Corporation or amendments to the Telesat Corporation Articles or the Partnership Agreement or (iii) request that Telesat Corporation or the Telesat Corporation Board take any action that is inconsistent with the foregoing.

The Investor Rights Agreements allow each of PSP Investments and MHR to transfer its respective right to designate one member of the Telesat Corporation Board to a third party if the applicable principal shareholder transfers an amount of Telesat Public Shares, Class C Shares, Telesat Partnership Units or any right or security that is exercisable for, convertible into or exchangeable for Telesat Corporation Shares representing (i) at least 9.9% of the issued and outstanding Telesat Corporation Shares on a fully diluted basis as of the Closing and (ii) at least 5% of the issued and outstanding Telesat Corporation Shares on a fully diluted basis at the time of such transfer. The acquirer’s right to designate one member to the Telesat Corporation Board will terminate upon the date that such acquirer holds Telesat Corporation Shares, Telesat Partnership Units or any right or security that is exercisable for, convertible into or exchangeable for Telesat Corporation Shares representing less than 5% of the issued and outstanding Telesat Corporation Shares on a fully diluted basis. Telesat Corporation agrees to take certain actions to reasonably cooperate with PSP Investments and/or MHR to facilitate a sale of PSP Investments’ or MHR’s Telesat Corporation Shares or Telesat Partnership Units, as applicable, to a third party, at PSP Investments’ and/or MHR’s sole cost and expense, for so long as PSP Investments or MHR, as applicable, beneficially owns at least 10% of the Telesat Corporation Shares or Telesat Partnership Units on a fully diluted basis.

Additional negotiated rights of PSP Investments and MHR are contained in the Telesat Corporation Articles and Partnership Agreement, and are discussed under “Description of Share Capital.”

Director Independence

Pursuant to NASDAQ Rule 5605, an “independent director” means a person other than an executive officer or employee of the company to whose board they are appointed to or any other individual having a relationship which, in the opinion of such company’s board of directors, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. In addition, the NASDAQ Marketplace Rules contain certain “bright-line” tests of independence that a board of directors must consider before making a determination of independence. Under NI 58-101, a director is considered to be independent if he or she is independent within the meaning of Section 1.4 of Multilateral Instrument 52-110 — Audit Committees of the securities commissions and similar regulatory authorities in all of the provinces and territories in Canada (“MI 52-110”). Pursuant to MI 52-110, an independent director is a director who is free from any direct or indirect material relationship with Telesat which could, in the view of the Telesat Corporation Board, be reasonably expected to interfere with the exercise of a director’s independent judgment.

Based upon information requested from and provided by each director concerning his or her background, employment and affiliations, including family relationships, the Telesat Corporation Board has determined that all of the members of the Telesat Corporation Board, other than Dan Goldberg and Michael Targoff, representing two of its ten directors, are “independent” within the meaning of NI 58-101 and NASDAQ Rule 5605. Telesat’s Chief Executive Officer, Dan Goldberg, is not independent as a result of his position with Telesat Corporation. Michael Targoff is not independent because he received certain consulting fees under his consulting agreement entered into with Loral on December 14, 2012, pursuant to which he was engaged as a part-time consultant to the Loral board of directors to assist with respect to the oversight of strategic matters relating to Telesat Canada and XTAR, LLC, and received consulting fees of US$120,000 per month before deduction of certain net expenses for which he reimbursed the Company. For the year ended December 31, 2021, Mr. Targoff earned US$1,272,000 (before his expense reimbursement to Loral of US$39,750). This agreement was terminated effective November 18, 2021.

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Pursuant to the Telesat Corporation Articles, the Telesat Corporation Board must also include three Specially Designated Directors for so long as either PSP Investments or MHR (or either of their respective affiliates) has the right to designate at least one director to the Telesat Corporation Board pursuant to their respective Investor Rights Agreements, as described above under “— Composition of the Telesat Corporation Board and Committees.” A “Specially Designated Director” is a director who (i) is initially designated as a Specially Designated Director or is nominated as a Specially Designated Director by the NCGC (or, for purposes of Telesat Corporation’s annual meeting of shareholders to be held in calendar year 2024, a subset thereof) and not designated to the Telesat Corporation Board by either PSP Investments or MHR, (ii) (x) satisfies the independence requirements of the applicable U.S. and/or Canadian securities exchanges on which the Telesat Public Shares are listed, (y) is “independent” of Telesat Corporation within the meaning of MI 52-110 and (z) is “independent” of Telesat Corporation within the meaning of Section 10A(m)(3)(B) of the Exchange Act, (iii) is not an affiliate or associate of MHR, PSP Investments or any other person with a contractual right to designate director nominees (or their respective affiliates), (iv) together with such person’s immediate family and affiliates, has not received compensation or payments from MHR, PSP Investments or any other person with a contractual right to designate director nominees (or their respective affiliates) in any of the past three years in an amount in excess of US$120,000 per annum, excluding for these purposes any directors fees, and (v) is Canadian (as defined in the Investment Canada Act).

Director Term Limits and Other Mechanisms of Telesat Corporation Board Renewal

The Telesat Corporation Board has not adopted director term limits or other automatic mechanisms of renewal of its members. Rather than adopting formal term limits, mandatory age-related retirement policies and other mechanisms of board renewal, the NCGC of the Telesat Corporation Board will seek to maintain the composition of the Telesat Corporation Board in a way that provides, in the judgment of the Telesat Corporation Board, the best mix of skills and experience to provide for Telesat Corporation’s overall stewardship. The NCGC also is expected to conduct an annual assessment of the Telesat Corporation Board, each committee, the Chair, each committee chair and each director regarding their effectiveness, efficiency and performance, and to report evaluation results to the Telesat Corporation Board. See also “— NCGC” and “— Diversity Policy”.

Meetings of Independent Directors and Conflicts of Interest

The Telesat Corporation Board will hold regularly scheduled meetings, as well as ad hoc meetings from time to time. The independent members of the Telesat Corporation Board will also meet regularly without the non-independent directors and members of management, and as may be required by NASDAQ or, if applicable, TSX listing standards from time to time. The Telesat Corporation Board has appointed an independent chair of the Telesat Corporation Board (the “Chair”).

To the extent that Telesat Corporation does not have an independent Chair, it will arrange for the appointment of a lead director (the “Lead Director”) whose responsibilities will be to ensure that the directors who are independent have opportunities to meet without management and non-independent directors present, as required, and to provide leadership for the independent directors on the Telesat Corporation Board. To the extent required, a Lead Director will be appointed and replaced from time to time by a majority vote of the directors who are independent, provided that such Lead Director is and will be at all times an independent director (as determined under the NASDAQ rules and NI 58-101). The Telesat Corporation Board will adopt a written position description for a Lead Director, to the extent one is appointed, which provides, among other things, that the Lead Director will be responsible for: (a) providing leadership to ensure that the Telesat Corporation Board functions independently of management of Telesat Corporation, (b) providing leadership to foster the effectiveness of the Telesat Corporation Board, (c) suggesting items of importance for consideration on the agenda for Telesat Corporation Board meetings, (d) chairing each board meeting, or the portion thereof, at which only independent directors are present, (e) as may be required from time to time, ensuring that the independent directors have the opportunity to meet separately in camera, without non-independent directors and senior executives present, (f) working with the Chair and the Chief Executive Officer to enhance the effectiveness and performance of the Telesat Corporation Board, as well as the committees and individual directors of the Telesat Corporation Board, and (g) performing additional duties as requested by the Telesat Corporation Board. Telesat currently has an independent chair and therefore no Lead Director.

Conflicts of Interest

Certain of our directors and officers are associated with other companies or entities, which may give rise to conflicts of interest. In accordance with Part 5 — Division 3 — Conflicts of Interest under the BCBCA, in the event that a director or senior officer (i) has a material interest in a contract or proposed contract or transaction that is

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material to an issuer or (ii) is a director or senior officer of, or has a material interest in, a person who has a material interest in the contract or transaction (a “disclosable interest”), the director or senior officer shall disclose his or her disclosable interest in such contract or transaction and the director shall refrain from voting on any matter in respect of such contract or transaction, subject to and in accordance with the BCBCA. To the extent that conflicts of interest arise, such conflicts will be resolved in accordance with the provisions of the BCBCA and applicable internal corporate governance or polices of the Telesat Corporation Board, as applicable.

Quorum

A quorum at any meeting of the Telesat Corporation Board consists of a majority of the directors then in office. Until the Special Board Date, such quorum will also require a majority of the Specially Designated Directors then in office. Further, prior to the occurrence of an Unwind Trigger, a quorum will also require that a majority of the members of the Telesat Corporation Board present must be comprised of directors who are both (i) Canadian (for the purposes of this section, as defined in the Investment Canada Act) and (ii) nominated for election by either: (x) the NCGC, if comprised of a majority of Canadian directors, (y) PSP Investments, or its affiliates, or (z) a shareholder who is Canadian. A director holding a disclosable interest in a contract or transaction to be considered at a meeting, if present at the meeting, is to be counted in a quorum notwithstanding such director’s interest.

Majority Voting Policy

In accordance with the requirements of the TSX, the Telesat Corporation Board has adopted a “Majority Voting Policy” that will require a nominee for election as a director who does not receive a greater number of votes “for” than votes “withheld” with respect to the election of directors by shareholders to tender a resignation to the Chair promptly following the applicable meeting of shareholders. Under the terms of the Majority Voting Policy, our NCGC will be required to consider such resignation and make a recommendation to the Telesat Corporation Board on whether such resignation should be accepted. The Majority Voting Policy requires that the Telesat Corporation Board shall promptly accept the resignation unless it determines, in consultation with the NCGC, that there are exceptional circumstances that should delay the acceptance of the resignation or justify rejecting it. The Telesat Corporation Board will be required to make its decision and announce it in a press release within 90 days following the meeting of shareholders. A director who tenders a resignation pursuant to the Majority Voting Policy will not be permitted to participate in any meeting of the Telesat Corporation Board or the NCGC at which the resignation is considered.

Diversity Policy

Of Telesat Corporation’s ten directors, two (or 20% of the Telesat Corporation Board) are women.

Consistent with the Corporate Governance Guidelines, the NCGC must take into account a variety of criteria, including skills, qualifications, experience and diversity, with consideration to the level of representation of women and other diverse candidates, when identifying, reviewing and evaluating candidates to serve as directors and executive officers of Telesat Corporation. Further, the Telesat Corporation Board may identify for the NCGC certain business, financial, industry, diversity or other general attributes desirable in any of such persons, and request that the NCGC (i) nominate a candidate for election at the next meeting of shareholders, or (ii) fill an actual or anticipated vacancy on the Telesat Corporation Board, in each case, with an individual who has such attributes and who is approved in accordance with the Telesat Corporation Articles and, in each case, the NCGC shall use its reasonable efforts to comply with any such requests.

Telesat Corporation is of the view that such a policy is not required in order to retain the best candidates for available openings. Telesat Corporation will, however, be mindful of the benefit of diversity of the Telesat Corporation Board and executive officers and the need to maximize their effectiveness and decision-making abilities. In this regard, Telesat Corporation is committed to increasing diversity on the Telesat Corporation Board, including having set a goal of having women represent 30% of the directors on the Telesat Corporation Board. In searches for new candidates, Telesat Corporation will consider the level of diversity, including female representation, on the Telesat Corporation Board and executive officers and this will be one of several factors used in the search process. Further, Telesat Corporation will continuously monitor the level of female representation and recruit qualified female candidates as part of its overall recruitment and selection process to fill openings, as the need arises, through vacancies, growth or otherwise.

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The table below provides certain information regarding the diversity of the board of directors.

Board Diversity Matrix
Country of Principal Executive Offices	Canada
Foreign Private Issuer	Yes
Disclosure Prohibited Under Home Country Law	No
	As of	03/28/2024			As of		12/31/2022
Total Number of Directors	10				10
Gender Identity	Female	Male	Non- <br>Binary	Did Not <br>Disclose <br>Gender	Female	Male		Non- <br>Binary	Did Not <br>Disclose <br>Gender
Directors	2	8	0	0	2	8		0	0
Demographic Background
Underrepresented Individual in Home Country Jurisdiction	0				0
LGBTQ+	0				0
Did Not Disclose Demographic Background	10				10

Orientation and Continuing Education

The Telesat Corporation Board offers an orientation program for new directors under which a new director will meet with the Chair, members of senior management and Telesat Corporation’s secretary. It provides a comprehensive orientation and education as to the nature and operation of Telesat Corporation and its business, the role of the Telesat Corporation Board and its committees, and the contribution that an individual director is expected to make. The NCGC is responsible for overseeing director continuing education designed to maintain or enhance the skills and abilities of the directors and to ensure that their knowledge and understanding of Telesat Corporation’s business and operations remains current.

Position Descriptions

The Telesat Corporation Board has adopted a written position description for the Chair, setting out the Chair’s key responsibilities, including, among others, duties relating to setting meeting agendas for the Telesat Corporation Board, chairing board and shareholder meetings of Telesat Corporation, director development and communicating with shareholders and regulators.

The Telesat Corporation Board has adopted a written position description for each of the committee chairs, which sets out such committee chair’s key responsibilities, including, among others, duties relating to setting committee meeting agendas, chairing committee meetings and working with the committee and management to ensure, to the greatest extent possible, the effective functioning of the committee.

The Telesat Corporation Board has adopted a written position description for Telesat Corporation’s Chief Executive Officer, setting out its key responsibilities, including, among others, duties in relation to providing overall leadership, ensuring the development of a strategic plan and recommending such plan to the Telesat Corporation Board for consideration, ensuring the development of an annual corporate plan and budget that supports the strategic plan and recommending such plan to the Telesat Corporation Board for consideration and supervising day-to-day management and communicating with shareholders and regulators.

Mandate of the Telesat Corporation Board

The Telesat Corporation Board is responsible for supervising the management of the business and affairs of Telesat Corporation, including providing guidance and strategic oversight to management. The Telesat Corporation Board has adopted a formal mandate that includes the following:

• selecting, appointing and supervising the Chief Executive Officer and approving the compensation of the Chief Executive Officer;

• taking steps to satisfy itself as to the integrity of the Chief Executive Officer and other senior executive officers and that the Chief Executive Officer and other senior executive officers create a culture of integrity throughout the organization;

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• adopting a strategic planning process and approving management’s strategic and business plans; and

• risk identification and ensuring that procedures are in place for the management of those risks.

Directors’ Service Contracts

There are no directors’ service contracts with Telesat Corporation or any of its subsidiaries providing for benefits upon termination of employment. One of our directors, Daniel S. Goldberg, also serves as Chief Executive Officer of Telesat Canada, for which he receives benefits upon termination of his employment.

Committees of the Telesat Corporation Board

Under the Telesat Corporation Articles, in addition to the three committees described below, and subject to the rights of PSP Investments and MHR contained in their respective Investor Rights Agreements, prior to both the Special Board Date and the Unwind Trigger, the Telesat Corporation Board may establish additional committees of Telesat Corporation with the approval of a majority of the Specially Designated Directors then in office. Prior to the occurrence of an Unwind Trigger, at least a majority of the members of each committee must meet the requirements to maintain Telesat Corporation’s status as a Canadian controlled entity described above under “— Board Practices — Canadian Director and Committee Member Requirements.”

Subject to the rights of PSP Investments and MHR contained in their respective Investor Rights Agreements and the rights of the Specially Designated Directors provided in the Telesat Corporation Articles, each as described above, the Telesat Corporation Board has the ability to change the membership of, or fill vacancies in, or appoint members or observers to, any of its committees.

The members of the Telesat Corporation Board may delegate to a new committee any of their powers, other than: the power to fill vacancies in the Telesat Corporation Board, the power to change the membership of (or fill vacancies in) any committee of the Telesat Corporation Board, the power to declare dividends or other distributions to the Telesat Corporation’s shareholders, the power to appoint or remove officers appointed by the Telesat Corporation Board and, subject to limited exceptions, the power to issue securities of Telesat Corporation. However, such delegation requires the approval of a majority of all of the directors then in office, which must include at least one designee appointed by PSP Investments, if one is serving, at least one designee appointed by MHR, if one is serving, and one Specially Designated Director, for so long as either PSP Investments or MHR is a 5% Holder.

Audit Committee

The Audit Committee must be comprised of at least three members, including at least one designee appointed by PSP Investments, for so long as PSP Investments has the right to designate at least one director to the Telesat Corporation Board pursuant to its Investor Rights Agreement, one designee appointed by MHR, for so long as MHR has the right to designate at least one director to the Telesat Corporation Board pursuant to its Investor Rights Agreement, and one Specially Designated Director. Telesat Corporation’s audit committee (the “Audit Committee”) is comprised of Michael Boychuk, Jane Craighead and Henry Intven. Michael Boychuk serves as the chair of the Audit Committee. Except for Mr. Boychuk as the first chair of the Audit Committee, the chair of the Audit Committee is required to be a Specially Designated Director. All members of the Audit Committee are persons determined by the Telesat Corporation Board to be both independent directors and financially literate within the meaning of NI 52-110. Each of the Audit Committee members has understanding of the accounting principles used to prepare financial statements and varied experience as to the general application of such accounting principles, as well as an understanding of the internal controls and procedures necessary for financial reporting.

The Telesat Corporation Board has adopted a written charter setting forth the purpose, composition, authority and responsibility of the Audit Committee, consistent with NI 52-110 and NASDAQ Rule 5605(c)(1). The Audit Committee assists the Telesat Corporation Board in fulfilling its oversight of:

• the integrity of Telesat Corporation’s financial statements and related information;

• Telesat Corporation’s compliance with applicable legal and regulatory requirements;

• the independence, qualifications and appointment of Telesat Corporation’s auditor;

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• risk management and internal control over financial reporting and disclosure controls and procedures; and

• the administration, funding and investment of Telesat Corporation’s pension plans and pension fund.

The Audit Committee is also responsible for:

• appointing, compensating, retaining and overseeing the work of Telesat Corporation’s principal accounting firm;

• establishing procedures for (a) the receipt, retention and treatment of complaints received by Telesat Corporation regarding accounting, internal controls or auditing matters and (b) confidential, anonymous submission of complaints by employees regarding questionable accounting or auditing matters;

• pre-approving all engagements for permitted non-audit services provided by Telesat Corporation’s auditor to Telesat Corporation; and

• reviewing with management and recommending to the Telesat Corporation Board for approval, the annual consolidated financial statements of Telesat Corporation.

Pursuant to its charter, the Audit Committee has the authority to engage outside counsel and other outside advisors as it deems appropriate to assist it in the performance of its functions.

The Audit Committee must approve all audit, audit-related and permitted non-audit services to be provided by Deloitte and their related fees. Fees related to the annual audits of Telesat Corporation’s consolidated financial statements are specifically approved by the Audit Committee on an annual basis. All fees for other audit and audit-related services are pre-approved annually or more frequently, if required. The Audit Committee considers whether the provision of non-audit services is compatible with maintaining Deloitte’s independence.

HRCC

The HRCC must be comprised of at least three members, including at least one designee appointed by PSP Investments, for so long as PSP Investments has the right to designate at least one director to the Telesat Corporation Board pursuant to its Investor Rights Agreement, one designee appointed by MHR, for so long as MHR has the right to designate at least one director to the Telesat Corporation Board pursuant to its Investor Rights Agreement, and one Specially Designated Director.

The three directors comprising the HRCC are Jane Craighead, Guthrie Stewart and Mark Rachesky. Jane Craighead serves as chair of the HRCC. Under U.S. and Canadian securities laws and applicable exchange rules, there are heightened independence standards for members of the HRCC. All of the HRCC members meet this heightened standard and will also be independent for purposes of NI 58-101 and NASDAQ 5605.

The Telesat Corporation Board has adopted a written charter setting forth the purpose, composition, authority and responsibility of the HRCC pursuant to the rules of the NASDAQ and the SEC, and consistent with the Corporate Governance Guidelines (subject to the rights of MHR and PSP Investments under the Telesat Corporation Articles and the Investor Rights Agreements). The HRCC’s purpose is to assist the Telesat Corporation Board in its oversight of executive compensation, management development and succession, director compensation and executive compensation disclosure.

The principal responsibilities and duties of the HRCC include:

• reviewing at least annually Telesat Corporation’s executive compensation plans;

• reviewing annually the compensation of Telesat Corporation’s Chief Executive Officer, taking into account the performance of Telesat Corporation’s Chief Executive Officer in light of pre-established goals and performance objectives and, based on such evaluation, recommending to the Telesat Corporation Board the Chief Executive Officer’s annual compensation;

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• reviewing on an annual basis the compensation structure for Telesat Corporation’s senior executive officers taking into account the performance of such senior executive officers’ in light of pre-established goals and performance objectives and make recommendations to the Telesat Corporation Board with respect to the compensation for such officers;

• assessing the competitiveness and appropriateness of Telesat Corporation’s policies relating to the compensation of executive officers on an annual basis; and

• reviewing and, if appropriate, recommending to the Telesat Corporation Board the approval of any adoption, amendment and termination of Telesat Corporation’s incentive compensation plans, overseeing their administration, and discharging any duties imposed on the HRCC by any of those plans.

Further particulars of the process by which compensation for Telesat Corporation’s executive officers is determined is provided under the heading “Executive Compensation.”

NCGC

Until the Special Nomination Termination Date, the NCGC must be comprised of one designee appointed by PSP Investments, for so long as PSP Investments has the right to designate at least one director to the Telesat Corporation Board pursuant to its Investor Rights Agreement, one designee appointed by MHR, for so long as MHR has the right to designate at least one director to the Telesat Corporation Board pursuant to its Investor Rights Agreement, and three Specially Designated Directors.

Following the Special Nomination Termination Date, the NCGC will be comprised of one designee appointed by PSP Investments, for so long as PSP Investments has the right to designate at least one director to the Telesat Corporation Board pursuant to its Investor Rights Agreement, one designee appointed by MHR, for so long as MHR has the right to designate at least one director to the Telesat Corporation Board pursuant to its Investor Rights Agreement, and one Specially Designated Director.

The NCGC is comprised of David Morin, Jane Craighead, Richard Fadden, Henry Intven and Mark Rachesky, each of whom is independent for purposes of NI 58-101 and NASDAQ 5605. The Chair of the NCGC, Henry Intven, is a Specially Designated Director.

The Telesat Corporation Board has adopted a written charter setting forth the purpose, composition, authority and responsibility of the NCGC. The NCGC’s purpose will be to assist the Telesat Corporation Board in:

• identifying individuals qualified to become members of the Telesat Corporation Board;

• selecting or recommending that the Telesat Corporation Board select director nominees for the next annual meeting of shareholders and determining the composition of the Telesat Corporation Board and its committees;

• developing and overseeing a process to annually assess the Telesat Corporation Board, the Chair, the committees of the Telesat Corporation Board, the chairs of such committees and individual directors;

• reviewing and assessing the environmental, social, humanitarian, and other social responsibility related policies, systems, and activities of Telesat Corporation; and

• developing and implementing Telesat Corporation’s policies regarding corporate governance, including principles contained in the Corporate Governance Guidelines.

In identifying new candidates for the Telesat Corporation Board, the NCGC considers what competencies and skills the Telesat Corporation Board, as a whole, should possess and assess what competencies and skills each existing director possesses, considering the Telesat Corporation Board as a group, and the personality and other qualities of each director, as these may ultimately determine the boardroom dynamic.

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It is the responsibility of the NCGC to regularly evaluate the overall efficiency of the Telesat Corporation Board and the Chair and all Telesat Corporation Board committees and their chairs. As part of its mandate, the NCGC conducts the process for the assessment of the Telesat Corporation Board, each committee and each director regarding his, her or its effectiveness and contribution, and report evaluation results to the Telesat Corporation Board on a regular basis.

D. Employees

As of December 31, 2023, Telesat and its subsidiaries had approximately 490 permanent full and part-time employees. Approximately 2.7% of our employees are subject to collective bargaining agreements. Our employee body is primarily comprised of professional engineering, sales and marketing staff, administrative staff and skilled technical workers. We consider our employee relations to be strong.

E. Share Ownership

See Item 6.B. — “Outstanding Option-Based Awards and Share-Based Awards” for information regarding the option-based and share-based awards granted to our NEOs outstanding as at December 31, 2023.

The following table presents information regarding the ownership of certain classes of shares of Telesat Corporation and Units of Telesat Limited Partnership by our directors and senior management as at March 19, 2024.

Name	Class A<br>Shares	Class B<br>Variable<br>Voting<br>Shares	Class A<br>Units	Class B<br>Units	Fully<br>exchanged<br>and converted<br>basis
Michael Boychuk	—	—	—	—	—
Jane Craighead	—	—	—	—	—
Richard Fadden	—	—	—	—	—
Daniel Goldberg	388,125	—	—	—	388,125 (0.78%)
Henry Intven	—	—	—	—	—
David Morin	—	—	—	—	—
Mark H. Rachesky, M.D.	—	46,136	—	18,050,092	18,096,228(1) (36.17%)
Guthrie Stewart	—	—	—	—	—
Michael B. Targoff	—	101,872	—	—	101,872 (0.20%)
Janet Yeung	—	13,885	—	—	13,885 (0.03%)
Michèle Beck	27,287	—	—	—	27,287 (0.05%)
Andrew Browne	—	52,845	—	—	52,845 (0.11%)
Christopher S. DiFrancesco	9,219	—	—	—	9,219 (0.02%)
John Flaherty	17,677	—	—	—	17,677 (0.04%)
Glenn Katz	—	11,525	—	—	11,525 (0.02%)
Michael C. Schwartz	—	87,245	—	—	87,245 (0.17%)
David N. Wendling	11,524	—	—	—	11,524 (0.02%)
France Teasdale	1,607	—	—	—	1,607 (—%)
Phillip Harlow	—	1,436	—	—	1,436 (—%)

____________

(1) Includes 18,035,092 held by funds affiliated with MHR and 46,136 shares and 15,000 units held directly by Dr. Mark Rachesky.

F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation

None.

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ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

A. Major Shareholders.

The following table sets forth the ownership of holders that are the beneficial owners of 5% or more of each class of shares of Telesat Corporation or each class of units of Telesat Partnership as at March 19, 2024.

In the table, the percentage of Telesat Corporation Shares beneficially owned is based on Telesat Corporation Shares outstanding as at March 19, 2024. These amounts assume all Class A Units, Class B Units and Class C Units have been exchanged into Telesat Corporation Shares on a one-for-one basis.

Name	Class A<br>Shares	Class B<br>Variable<br>Voting<br>Shares	Class C<br>Shares	Class B<br>Units	Class C<br>Units	Fully<br>exchanged<br>and converted <br>basis
PSP Investments(3)	—	—	112,841	—	18,098,362	18,211,203 (36.40%)
Mark H. Rachesky, M.D.(5)	—	46,136	—	18,050,092	—	18,096,228 (36.17%)
MHR	—	—	—	18,035,092	—	18,035,092 (36.05%)
GAMCO Investors, Inc(4)	—	3,308,663	—	—	—	3,308,663 (6.61%)
Heard Capital LLC(4)	—	1,778,837	—	—	—	1,778,837 (3.56%)
Rubric Capital Management LP(4)	—	959,764	—	—	—	959,764 (1.92%)
Daniel Lau and Christine Man(4)	—	736,759	—	—	—	736,759 (1.47%)
Philosophy Capital Management LLC(4)	—	667,287	—	—	—	667,287 (1.33%)

____________

(1) Certain individuals and entities hold Class A Units, Class B Units or Class C Units of Telesat Partnership, which are redeemable, at the election of such holder, for newly issued shares of Class A Shares, Class B Variable Voting Shares or Class C Shares, respectively, on a one-for-one basis (and such holders’ Class A Units, Class B Units or Class C Units, as the case may be, will be cancelled on a one-for-one basis upon any such issuance). The number of Class A Shares beneficially owned and percentages of beneficial ownership set forth in the table assume that all Class A Units have been exchanged for Class A Shares (and the corresponding Class A Units have been cancelled). The numbers of Class B Variable Voting Shares beneficially owned and percentages of beneficial ownership set forth in the table assume that all Class B Units have been exchanged for Class B Variable Voting Shares (and the corresponding Class B Units have been cancelled). The numbers of Class C Shares beneficially owned and percentages of beneficial ownership set forth in the table assume that all Class C Units have been exchanged for Class C Shares (and the corresponding Class C Units have been cancelled).

(2) Percentage of combined voting power represents voting power with respect to all of our Telesat Corporation Shares and all Telesat Partnership Units on an as converted basis. In order to maintain Telesat Corporation’s status as Canadian, the Telesat Corporation Articles employ a variable voting mechanism by way of, amongst other controls, the “Golden Share;” the voting power attributed to the Golden Share will vary to ensure that the aggregate number of votes cast by Canadians, including Red Isle, with respect to a particular matter, will equal a simple majority of all votes cast in respect of such matter, resulting in the dilution of the voting power of Telesat Corporation’s non-Canadian shareholders. See Exhibit 2.6 “Description of Share Capital — Meetings and Voting Rights — Golden Share Mechanic.”

(3) Red Isle Private Investments Inc. is a wholly owned subsidiary of PSP Investments and is the legal owner of the Telesat Corporation Shares attributed to PSP Investments in the table above. The number of Telesat Corporation Shares set out above represents PSP Investments’ interests in both the Class C Fully Voting Shares and Class C Limited Voting Shares on a combined basis. The Class C Limited Voting Shares are not entitled to vote to elect the directors of the Company.

(4) These share amounts are based on a schedule 13D filing by GAMCO Investors Group filed on August 2, 2023, a 13G filing by Rubric Capital Management filed on February 12, 2024, a 13G filing by Heard Capital LLC filed on February 13, 2024, a 13G filing by Daniel Lau and Christine Man on February 13, 2024, and a 13G filing by Philosophy Capital Management LLC on February 9, 2024.

(5) Includes the 18,035,092 held by funds affiliated with MHR and 46,136 shares and 15,000 units held directly by Dr. Mark Rachesky

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The portion of each class of securities held by jurisdiction and the number of record holders, as of March 19, 2024, is as follows:

Securities	Number of holders	Percentage<br>of holdings<br>per class of<br>securities
Class A Shares and Class B Variable Voting Shares
United States	125	95.4	%
Canada	3	2.3	%
Other	3	2.3	%
Class C Shares
Canada	1	100.0	%
Class A and B Limited Partnership Units
United States	39	97.5	%
Canada	1	2.5	%
Class C Limited Partnership Units
Canada	1	100.0	%

Significant Changes in Ownership

None

Voting Rights

The holders of Class A Shares, Class B Variable Voting Shares, Class C Shares, Special Voting Shares, Telesat Corporation Super Voting Shares and the Golden Share will generally be entitled to receive notice of and attend meetings of Telesat Corporation’s shareholders and receive copies of all proxy materials, information statements and other written communications, including from third parties, given in respect of Telesat Public Shares. Holders of Telesat Corporation Shares shall have one vote for each Telesat Corporation Share held at all meetings of the shareholders of Telesat Corporation, except meetings at which only holders of another class or of a particular series shall have the right to vote, provided that holders of Class C Limited Voting Shares will not be entitled to vote on the election of directors of Telesat Corporation. The Telesat Corporation Articles provide that the holders of the Telesat Corporation Shares will vote together as a single class with the Telesat Partnership Units (via the Special Voting Shares), and the Golden Share, with a simple majority of votes required to pass the majority of matters (other than the election of directors of Telesat Corporation, which shall be decided by a plurality of votes cast). Until the occurrence of an Unwind Transaction, a simple majority of votes cast by the holders of Telesat Corporation Shares and Special Voting Shares, voting together as a single class, will be required to approve a Second Tabulation Matter, as defined and described below.

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The following table summarizes the voting power of the different classes of Telesat Corporation Shares and Telesat Partnership Units:

Class	Voting For Directors	All Other <br>Votes	Second Tabulation Votes
Class A Shares	1 vote per share	1 vote per share	1 vote per share
Class B Variable Voting Shares	1 vote per share; provided that any voting power of a single holder in excess of one-third of the outstanding voting power of the Telesat Corporation Shares and Telesat Partnership Units (via the Special Voting Shares) and the Golden Share Canadian Votes (described in Exhibit 2.6 under the section “Description of Share Capital — Meetings and Voting Rights — Golden Share Mechanic”) will effectively be transferred to the Golden Share.		1 vote per share
Class C Fully Voting Shares	1 vote per share	1 vote per share	1 vote per share
Class C Limited Voting Shares	No votes	1 vote per share	1 vote per share
Class A Units (voted via the Class A Special Voting Share)	1 vote per share	1 vote per unit	1 vote per share
Class B Units (voted via the Class B Special Voting Share)	1 vote per unit; provided that any voting power of a single holder in excess of one-third of the outstanding voting power of the Telesat Corporation Shares and Telesat Partnership Units (via the Special Voting Shares) and the Golden Share Canadian Votes (described in Exhibit 2.6 under the section “Description of Share Capital — Meetings and Voting Rights — Golden Share Mechanic”) will effectively be transferred to the Golden Share.		1 vote per unit
Class C Units (voted via the Class C Special Voting Share)	Limited votes to ensure compliance with restrictions applicable to PSP Investments pursuant to its constating legislation.	1 vote per unit	1 vote per unit
Golden Share	A number of votes equal to the sum of:<br> <br>• A number of votes such that the votes cast by the holders of Class A Shares and Class A Units, Class C Shares and Class C Units, and the Golden Share represent a simple majority of the votes cast; and<br> <br>• The number of votes transferred from the Class B Shares and Class B Units, if applicable.		No votes

Change in Control Arrangements

We are not aware of any arrangement that may at a subsequent date, result in a change of control of the Company.

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B. Related Party Transactions

The Transaction

On November 23, 2020, Loral entered into the Transaction Agreement with Telesat Canada, Telesat Corporation, Telesat Partnership, Telesat CanHoldco, Merger Sub, PSP Investments and Red Isle. The Transaction closed on November 18, 2021. The Transaction resulted in the pre-closing stockholders of Loral, PSP Investments (through Red Isle) and the other shareholders in Telesat Canada who signed Stockholder Contribution Agreements or Optionholder Exchange Agreements (principally current or former management) owning approximately the same percentage of equity in Telesat Canada indirectly through Telesat Corporation and/or Telesat Partnership as they held (indirectly in the case of Loral stockholders and PSP Investments) in Telesat Canada. Telesat Corporation became the publicly traded general partner of Telesat Partnership and Telesat Partnership indirectly owns all of the economic interests in Telesat Canada. The Transaction was effected through a series of transactions, including: (i) Red Isle contributing approximately US$5 million in value of its equity interests in Telesat Canada in exchange for Class C Shares and the balance of its equity interest in Telesat Canada in exchange for Class C Units (PSP Investments (a) being entitled to a payment of US$7 million, (b) being entitled to or obligated to pay a post-closing economic adjustment reflecting the net asset value of Loral’s non-Telesat Canada assets and liabilities, and (c) being indemnified for certain losses incurred by Telesat Corporation following the consummation of the Transaction).

Investor Rights Agreements

Telesat Corporation and MHR, on the one hand, and Telesat Corporation and PSP Investments, on the other hand, entered into the Investor Rights Agreements dated as of November 23, 2020, pursuant to which, among other things, each of PSP Investments and MHR are entitled to designate three directors to the board of directors of Telesat Corporation and have the exclusive right to fill vacancies of any directorship for which it has the right to designate a director. The number of designees each of PSP Investments and MHR are entitled to designate to the board of directors of Telesat Corporation will be reduced to two, one and zero upon PSP Investments or MHR, respectively, owning less than 25%, 15% or 5% of the Telesat Corporation Shares and the Telesat Partnership Units (on an “as-exchanged” basis) outstanding as of the Closing. The number of independent directors that the Nominating Committee may designate will be increased by one each time the number of designees PSP Investments or MHR is entitled to designate is so reduced.

Registration Rights and Tag Along Rights between MHR and PSP Investments

In connection with the Transaction, MHR and certain of its affiliates and PSP Investments entered into the Registration Rights Agreement with Telesat Corporation, which will become effective at the Effective Time pursuant to its terms.

Goldberg, Godles, Wiener & Wright

Henry Goldberg, the father of Daniel Goldberg, the President and Chief Executive Officer of Telesat Corporation, is a partner in the law firm of Goldberg, Godles, Wiener & Wright, which handles certain matters for Telesat Corporation and its subsidiaries. As of December 31, 2023, the aggregate amount of expenses incurred by Telesat Corporation and its subsidiaries for services received in 2023 was US$0.7 million.

Agreements with Directors and Officers

We have entered into employment or service agreements with members of executive management. See Item 6.B. “Directors, Senior Management and Employees” — “Compensation” — “Executive Compensation”. Additionally, we have a compensation program for our directors. See Item 6.B. “—” — “Compensation” — “Director Compensation”.

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Indemnification Agreements

We have entered into indemnification agreements with each of our directors and executive officers pursuant to which we have agreed to indemnify them against a number of fees, costs, charges and expenses incurred by such persons in connection with claims made by reason of their being a director or officer of the Company or who act or acted at the Company’s request as a director and/or officer or in a similar capacity of other entities. Any claims for indemnification by our directors and officers may reduce our available funds to satisfy successful third-party claims against us and may reduce the amount of money available to us. See Item 19. — “Exhibits”.

C. Interests of Experts and Counsel

Not applicable.

ITEM 8. FINANCIAL INFORMATION

A. Consolidated Financial Statements and Other Financial Information

See our Consolidated Financial Statements beginning at page F-1.

Legal Proceedings

We are currently party to various claims and legal actions that arise in the ordinary course of business. In addition, we may become subject to future claims and legal actions from time to time in the ordinary course of business. We believe such claims and legal actions, individually and in the aggregate, will not have a material adverse effect on our business, financial condition, results of operations or cash flows.

For further description of the legal proceedings, see Item 4.B “Information on the Company” — “Business Overview”.

Dividend Policy

We currently intend to retain all available funds and any future earnings to support operations and to finance the growth and development of our business. As such, we do not intend to declare or pay cash dividends or distributions on our Telesat Public Shares, Telesat Corporation Shares or Telesat Partnership Units in the foreseeable future. Any future determination to pay dividends will be made at the discretion of our board of directors subject to applicable laws and will depend upon, among other factors, our financial performance, financial condition including leverage levels, contractual restrictions, capital requirements and merger and acquisition opportunities. Our future ability to pay cash dividends on our Telesat Public Shares, Telesat Corporation Shares or Telesat Partnership Units is currently limited by the terms of our credit agreement and may be limited by the terms of any future debt or preferred securities.

B. Significant Changes

We have not experienced any significant changes in our financial position since the date of our Annual Financial Statements included in this Annual Report.

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ITEM 9. THE OFFER AND LISTING

Telesat Corporation’s Class A Shares and Class B Variable Voting Shares have been listed on both the Nasdaq Global Select Market and the TSX since November 19, 2021 under the single symbol “TSAT”. The Telesat Partnership Units are not listed on any exchange.

ITEM 10. ADDITIONAL INFORMATION

A. Share Capital

Not applicable.

B. Constating Documents and Articles of Telesat Corporation

See Exhibit 2.6 to the Annual Report — Description of Rights of each Class of Securities Registered under Section 12 of the Securities Exchange Act of 1934 and “Comparison of Rights of Telesat Corporation Shareholders, Telesat Partnership Unitholders and Loral Stockholders” in the Registration Statement on Form F-4 (File No. 333-255518).

Transfer Agent and Registrar

The transfer agent and registrar for our Telesat Corporation Shares and Telesat Partnership Units in the United States is Computershare Trust Company, N.A. at its principal office in Canton, Ohio, and in Canada is Computershare Investor Services Inc. at its principal office in Vancouver, British Columbia.

Ownership and Exchange Controls

There is no limitation imposed by Canadian law or by Telesat Corporation Articles on the right of a non-resident to hold or vote our Telesat Corporation Shares, other than discussed below.

Competition Act

Limitations on the ability to acquire and hold our Telesat Corporation Shares may be imposed by the Competition Act (Canada). This legislation permits the Commissioner of Competition (the “Commissioner”), to review any acquisition or establishment, directly or indirectly, including through the acquisition of shares, of control over or of a significant interest in us. This legislation grants the Commissioner jurisdiction, for up to one year after the acquisition has been substantially completed, to challenge this type of acquisition by seeking a remedial order, including an order to prohibit the acquisition or require divestitures, from the Canadian Competition Tribunal, which may be granted where the Competition Tribunal finds that the acquisition substantially prevents or lessens, or is likely to substantially prevent or lessen, competition.

This legislation also requires any person or persons who intend to acquire more than 20% of our voting shares or, if such person or persons already own more than 20% of our voting shares prior to the acquisition, more than 50% of our voting shares, to file a notification with the Canadian Competition Bureau, along with us, if certain financial thresholds are exceeded. Where a notification is required, unless an exemption is available, the legislation prohibits completion of the acquisition until the expiration of the applicable statutory waiting period, unless the Commissioner either waives or terminates such waiting period or issues an advance ruling certificate. The Commissioner’s review of a notifiable transaction for substantive competition law considerations may take longer than the statutory waiting period.

Investment Canada Act

The Investment Canada Act requires each “non-Canadian” (as defined in the Investment Canada Act) who acquires “control” of an existing “Canadian business,” to file a notification in prescribed form with the responsible federal government department or departments not later than 30 days after closing, provided the acquisition of control is not a reviewable transaction under the Investment Canada Act. Subject to certain exemptions, a transaction that is reviewable under the Investment Canada Act may not be implemented until an application for review has been filed and the responsible Minister of the federal cabinet has determined that the investment is likely to be of “net benefit to

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Canada” taking into account certain factors set out in the Investment Canada Act. Under the Investment Canada Act, an investment in our Telesat Corporation Shares by a non-Canadian who is ultimately controlled by nationals of a European Union member state, Australia, Brunei, Chile, Colombia, Honduras, Japan, Malaysia, Mexico, New Zealand, Panama, Peru, Singapore, South Korea, the United Kingdom, the United States or Vietnam, would be reviewable only if it were an investment to acquire control of us pursuant to the Investment Canada Act and our enterprise value (as determined pursuant to the Investment Canada Act and its regulations) was equal to or greater than the amount specified, which is currently $1.989 billion. For investors who are not state-owned enterprises and are ultimately controlled by nationals of other World Trade Organization member states, the threshold is currently an enterprise value of $1.326 billion for 2024. For investors who are state-owned enterprises ultimately controlled by World Trade Organization member states, the threshold is currently an asset value (as determined pursuant to the Investment Canada Act and its regulations) of $528 million.

The Investment Canada Act contains various rules to determine if there has been an acquisition of control. Generally, for purposes of determining whether an investor has acquired control of a corporation by acquiring shares, the following general rules apply, subject to certain exceptions: the acquisition of a majority of the undivided ownership interests in the voting shares of the corporation is deemed to be acquisition of control of that corporation; the acquisition of less than a majority, but one-third or more, of the voting shares of a corporation or of an equivalent undivided ownership interest in the voting shares of the corporation is presumed to be acquisition of control of that corporation unless it can be established that, on the acquisition, the corporation is not controlled in fact by the acquirer through the ownership of voting shares; and the acquisition of less than one-third of the voting shares of a corporation or of an equivalent undivided ownership interest in the voting shares of the corporation is deemed not to be acquisition of control of that corporation.

Under the national security review regime in the Investment Canada Act, review on a discretionary basis may also be undertaken by the federal government with respect to a much broader range of investments by a non-Canadian to “acquire, in whole or part, or to establish an entity carrying on all or any part of its operations in Canada.” No financial threshold applies to a national security review. The relevant test is whether such investment by a non-Canadian could be “injurious to national security.” The responsible ministers have broad discretion to determine whether an investor is a non-Canadian and therefore subject to national security review. Review on national security grounds is at the discretion of the responsible ministers, and may occur on a pre- or post-closing basis.

Certain transactions relating to our Telesat Corporation Shares will generally be exempt from the Investment Canada Act, subject to the federal government’s prerogative to conduct a national security review, including:

• the acquisition of our Telesat Corporation Shares by a person in the ordinary course of that person’s business as a trader or dealer in securities;

• the acquisition of control of us in connection with the realization of security granted for a loan or other financial assistance and not for any purpose related to the provisions of the Investment Canada Act; and

• the acquisition of control of us by reason of an amalgamation, merger, consolidation or corporate reorganization following which the ultimate direct or indirect control in fact of us, through ownership of our Telesat Corporation Shares, remains unchanged.

Other

There is no law, governmental decree or regulation in Canada that restricts the export or import of capital, or that would affect the remittance of dividends (if any) or other payments by us to non-resident holders of our Telesat Public Shares, other than withholding tax requirements.

Description of Telesat Partnership Units and GP Units

The authorized units of Telesat Partnership consist of: (i) an unlimited number of Class A Units, held by the limited partners (other than Red Isle, Red Isle’s permitted transferees that are wholly owned by PSP Investments or any holder of Class D limited partnership units of Telesat Partnership (“Class D Units”) in their capacity as such) who can demonstrate to Telesat Partnership that they are Canadian (as defined in the Investment Canada Act);

(ii) an unlimited number of Class B Units, held by the limited partners (other than Red Isle, Red Isle’s permitted transferees that are wholly owned by PSP Investments or any holder of Class D Units in their capacity as such);

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(iii) Class C Units, held by Red Isle or its permitted transferees that are wholly owned by PSP Investments; and (iv) Telesat Partnership GP Units, held by Telesat Corporation as the general partner of Telesat Partnership. Class D Units will also be authorized from and after the Effective Time but may be issued only to a wholly owned subsidiary of the general partner of Telesat Partnership immediately before the Telesat Partnership Units cease to be outstanding. The number of Telesat Partnership Units to be issued pursuant to the Transaction was determined prior to the closing of the Transaction based on the number of Telesat Partnership Elections by Loral stockholders.

The following is a summary of the material rights, privileges, restrictions and conditions that attach to the Telesat Partnership Units and the Telesat Partnership GP Units. This is a summary only and is subject to the detailed provisions of the Form of Partnership Agreement.

Economic and Voting Rights

The Telesat Partnership Units are intended to provide economic rights that are substantially equivalent, and voting rights with respect to Telesat Corporation that are substantially equivalent, to the corresponding rights afforded to holders of Telesat Corporation Shares, as applicable.

Economic Rights

All Telesat Partnership Units have the same economic rights. Further, for so long as Telesat Corporation is the general partner of Telesat Partnership, if any shares in the capital of Telesat Corporation other than the Telesat Corporation Shares are issued by Telesat Corporation (“New Shares”), Telesat Corporation will (either immediately before or after such issuance), (A) cause Telesat Partnership to create a corresponding new class of Telesat Partnership units (“New Units”) that have corresponding distribution rights to such New Shares, (B) cause Telesat Partnership to issue one or more New Units to Telesat Corporation in exchange for the contribution by Telesat Corporation of the proceeds from, or other consideration received in connection with, the issuance of such New Shares to Telesat Partnership and (C) effect such amendments to the Partnership Agreement as are described in the Partnership Agreement.

Other material economic rights, privileges, restrictions and conditions attaching to the Telesat Partnership Units under the terms of the Partnership Agreement include the following:

• Telesat Partnership Units vote on a pass-through basis with corresponding classes of Telesat Corporation Shares.

• Telesat Corporation may not issue or distribute rights, options or warrants or other securities or assets of Telesat Corporation to all or substantially all of the holders of Telesat Corporation Shares unless a corresponding distribution is made to holders of the Telesat Partnership Units.

• No subdivision or combination of the outstanding Telesat Corporation Shares is permitted unless a corresponding subdivision or combination of Telesat Partnership Units is made.

• Telesat Corporation and the Telesat Corporation Board are prohibited from proposing or recommending an offer for the Telesat Corporation Shares or for the Telesat Partnership Units unless the holders of the Telesat Partnership Units and the holders of Telesat Corporation Shares are entitled to participate to the same extent and on an equitably equivalent basis.

• Approval of holders of the Telesat Partnership Units is required for an action (such as an amendment to the Partnership Agreement) that would affect the economic rights of a Telesat Partnership Unit relative to a Telesat Corporation Share, as applicable.

• Telesat Corporation, as general partner of the Partnership, is restricted from taking certain actions that would impact the capital structure of Telesat Partnership.

Canadian securities regulatory authorities may also intervene in the public interest (either on application by an interested party or by staff of a Canadian securities regulatory authority) to prevent an offer to holders of Telesat Corporation Shares or Exchangeable Units being made or completed where such offer is abusive.

See also “— Reciprocal Changes”, above.

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Voting Powers

The holders of Telesat Partnership Units are indirectly entitled to vote in respect of matters on which holders of Telesat Corporation Shares are entitled to vote, including in respect of the election of directors of Telesat Corporation, through the Special Voting Shares. Telesat Corporation, Telesat Partnership and the Trustee have entered into the Trust Voting Agreement. This summary is qualified in its entirety by reference to that agreement.

The Special Voting Shares are held by the Trustee, entitling the Trustee to that number of votes on applicable matters on which holders of Telesat Public Shares are entitled to vote that is equal to the number of Telesat Corporation Shares into which the Telesat Partnership Units held by the holders of such Telesat Partnership Units on the applicable record date are convertible. Pursuant to the Partnership Agreement, each holder of Telesat Partnership Units has the right to direct Telesat Corporation as to how to instruct the Trustee to vote the voting power of the Special Voting Shares corresponding to such holder’s Telesat Partnership Units.

Pursuant to the Trust Voting Agreement, the Trustee is required to cast such votes in accordance with voting instructions provided to it by Telesat Corporation, in its capacity as general partner of Telesat Partnership. In the absence of instructions from Telesat Corporation with respect to all or any such votes, the Trustee will not exercise those votes.

Pursuant to the Partnership Agreement and the Telesat Corporation Articles, Telesat Corporation will also instruct the Trust how to vote the Golden Share. In the absence of instructions from Telesat Corporation with respect to how to vote the Golden Share, the Trustee will not vote the Golden Share. See Exhibit 2.6 “Description of Telesat Corporation Shares — Meetings of Shareholders and Voting Rights — Golden Share Mechanic.”

So long as any Telesat Partnership Units are outstanding, the Class D Units will not have any voting rights.

Exchange Right

A holder of Telesat Partnership Units shall, at any time and from time to time, have the right to require Telesat Partnership to repurchase (the “Exchange Right”) any or all of Telesat Partnership Units held by such holder in exchange for the applicable class of Telesat Corporation Shares; provided, however, that a holder of Telesat Partnership Units may exercise its Exchange Right at any time to effect a transfer to be effective prior to (and if so elected by such holder, subject to) the Closing of a Telesat Control Transaction so that such Telesat Corporation Shares to be received by such holder in such repurchase will have the full right and power to participate in such Telesat Control Transaction.

In order to exercise the Exchange Right, a holder of Telesat Partnership Units must deliver to Telesat Partnership, at its office (or at a designated office of Telesat Partnership’s transfer agent), a duly executed exchange notice (the “Exchange Notice”) together with such additional documents and instruments as the transfer agent and Telesat Partnership may reasonably require. The Exchange Notice must specify the number and class of Telesat Partnership Units in respect of which the holder is exercising the Exchange Right, and in the case of Class C Units, whether such units are to be exchanged for Class C Fully Voting Shares or Class C Limited Voting Shares.

An exercise of the Exchange Right may be revoked by the exercising holder by notice in writing given to Telesat Partnership before the close of business on the second business day immediately preceding the exchange date specified in the applicable Exchange Notice, which date must be a business day and must not be less than two business days nor more than ten business days after the date upon which such Exchange Notice is delivered to Telesat Partnership (the “Exchange Date”). On the Exchange Date, Telesat Partnership will deliver or cause the transfer agent to deliver to the relevant holder the applicable number of Telesat Corporation Shares.

Notwithstanding the exercise of the Exchange Right, where a record date in respect of a distribution with respect to the Telesat Partnership Units occurs prior to the exchange date and there is any declared and unpaid distribution on any Telesat Partnership Unit so exchanged, such amount shall remain payable and shall be paid in the applicable form on the designated payment date to the former holder of the Telesat Partnership Unit so exchanged. In addition, any deferred tax distribution (as described below) shall remain due and payable.

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Mandatory Exchange

Telesat Partnership may cause a mandatory exchange of the outstanding Telesat Partnership Units into Telesat Public Shares in the event that:

• At any time the number of Telesat Partnership Units outstanding (other than Telesat Partnership Units held by Telesat Corporation and its affiliates) represents less than 2% of the capital of Telesat Corporation on a fully diluted basis (a “Sunset Exchange”);

• A Telesat Control Transaction occurs in respect of which both: (i) the Telesat Corporation Board determines, in good faith, that such a transaction involves an arm’s-length transaction with a bona fide third party for a legitimate commercial purpose other than to cause the exchange of the Telesat Partnership Units and (ii) the holders of the Telesat Partnership Units receive not less than 15 business days’ prior written notice before the date Telesat Corporation makes such a determination (a “Control Transaction Exchange”); or

• The holders of the Telesat Partnership Units fail to take the necessary action at a meeting or other vote of holders of Telesat Partnership Units to approve or disapprove, as applicable, a matter that requires such approval or disproval, as applicable, to maintain the economic equivalence of the Telesat Partnership Units, the Telesat Partnership GP Units and the Telesat Corporation Shares (a “Voting Event Exchange”).

Where Telesat Partnership determines to cause the mandatory exchange of all of the outstanding Telesat Partnership Units into Telesat Corporation Shares, it will give prior written notice specifying the date of the mandatory exchange to the holders of Telesat Partnership Units at least 15 days prior to such mandatory exchange, in the case of a Sunset Exchange or a Control Transaction Exchange, and on the business day following the day on which the holders of the Telesat Partnership Units failed to take such action in the case of a Voting Event Exchange.

Conversion of Telesat Partnership Units

An issued and outstanding Class A Unit will immediately be converted into a Class B Unit automatically and without any further act of Telesat Partnership, the general partner or the holder thereof, if such Class A Unit is or becomes beneficially owned or controlled, directly or indirectly, by a person who is not a Canadian (as defined in the Investment Canada Act). In contrast, if an issued and outstanding Class B Unit becomes beneficially owned and controlled, directly or indirectly, by a person who is Canadian, then (i) such holder of Class B Units may notify Telesat Partnership of such holder’s status as Canadian, and (ii) upon providing evidence satisfactory to Telesat Partnership to confirm such holder’s status as Canadian, the Class B Units will be converted into an equal number of Class A Units.

Transfers

Under the Partnership Agreement, with the exception of the exchange rights set out under “— Exchange Right” and “— Mandatory Exchange” above, no limited partner of Telesat Partnership may transfer its Telesat Partnership Units unless, in the case of a natural person, upon their demise, to their estate and heirs or, in the case of someone who is not a natural person, (i) by operation of law upon the consummation of a merger, consolidation, amalgamation, liquidation, dissolution or similar transaction or (ii) pursuant to a transfer in which, for U.S. federal income tax purposes, the basis of the Telesat Partnership Unit in the hands of the transferee is determined, in whole or in part, by reference to its basis in the hands of the transferor or is determined under section 732 of the Code. If such a transfer is effected, Telesat Corporation may require, among other things, that the applicable holder of Class A Units making a transfer provide a statutory declaration under the Canada Evidence Act or otherwise concerning whether such holder or beneficial owner is a Canadian (as defined in the Investment Canada Act).

Each of PSP Investments (through Red Isle) and MHR may not transfer any of its interests in Telesat Partnership, other than transfers to its direct and indirect wholly owned subsidiaries. Further, until Red Isle no longer holds any Telesat Partnership Units, PSP Investments may not transfer its interests in Red Isle or reduce its economic exposure to Telesat Partnership Units held by Red Isle unless such transfer is to a direct or indirect wholly owned subsidiary of PSP Investments. However, upon the transferee of such interests no longer being a direct or indirect wholly owned subsidiary of the applicable transferor, such transferee must transfer the transferred interests back to the applicable transferor.

The general partner may not transfer its interests in the Partnership, except as described above under “Telesat Partnership Governance”.

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Notice of Meeting Rights

The holders of Telesat Partnership Units will have the right to receive notice of and to attend any meeting of the partners of Telesat Partnership at which the holders of Telesat Public Shares are entitled to vote. The general partner will mail or cause to be mailed (or otherwise communicate) to the holders of Telesat Partnership Units the notice of each meeting at which the holders of Telesat Public Shares are entitled to vote, together with the related materials and a statement as to the manner in which the holder may instruct the general partner to instruct the Trustee to exercise the votes attaching to the Special Voting Share, on the same day as Telesat mails (or otherwise communicates) the notice and materials to the holders of Telesat Public Shares. The general partner will also send to the holders of Telesat Partnership Units copies of proxy materials, all information statements, reports (including interim and annual financial statements) and other written communications sent by Telesat Corporation or third parties to the holders of Telesat Public Shares, provided, however, that the general partner shall not be required to provide a holder of Telesat Partnership Units with such mailing or communication if the Telesat Public Shares receivable upon the exchange of the Telesat Partnership Units do not have the right to vote.

The holders of Telesat Partnership Units will also have the right to receive notice of and to attend any meeting of the partners of Telesat Partnership.

Quorum

A quorum at any meeting of the partners of Telesat Partnership will consist of one or more partners present in person or by proxy holding a majority of the voting power which may be exercised at such meeting.

Dividend Rights

The general partner of Telesat Partnership will cause distributions to be made by Telesat Partnership to the partners in the following order of priority: (a) the general partner may, in its sole discretion, from time to time cause cash distributions to be made by Telesat Partnership to Telesat Corporation (which distributions will be made without pro rata distributions to the other partners) in such amounts as required for Telesat Corporation to pay certain expenses and tax liabilities described in the Partnership Agreement and (b) after payment of any deferred distributions described below, the general partner may, in its sole discretion, from time to time in such amounts as it shall determine, cause distributions to be made by Telesat Partnership to the partners in accordance with their percentage interests, pro rata.

Telesat Corporation currently intends to retain all available funds and any future earnings to support operations and to finance the growth and development of its business. As such, it does not intend to declare or pay cash dividends or distributions on the Telesat Public Shares, Telesat Corporation Shares or Telesat Partnership Units in the foreseeable future. Any future determination to pay dividends will be made at the discretion of the Telesat Corporation Board subject to applicable laws and will depend upon, among other factors, Telesat Corporation’s financial performance, financial condition including leverage levels, contractual restrictions, capital requirements and merger and acquisition opportunities. Telesat Corporation’s future ability to pay cash dividends on its Telesat Public Shares, Telesat Corporation Shares or Telesat Partnership Units is currently limited by the terms of its credit agreement and may be limited by the terms of any future debt or preferred securities

Before declaring any dividends in the future, in order to avoid having a holder of Telesat Partnership Units receive a distribution from Telesat Partnership, then immediately exchange their Telesat Partnership Units for Telesat Public Shares and receive a substantially equivalent distribution from Telesat Corporation as well, Telesat Corporation intends to adopt a dividend policy such that it will declare a concurrent dividend with the same record date.

In the event that any partner other than Telesat Corporation that is subject to U.S. federal income tax has net cumulative taxable income that exceeds zero, then on the next applicable tax distribution date, Telesat Partnership shall distribute to each partner, whether or not such partner is subject to U.S. federal income tax, its assumed tax liability, less all prior distributions pursuant to the preceding paragraph and this paragraph paid in respect of such partner’s units, provided, however, that Telesat Corporation may defer such distribution, which shall then accumulate at the rate of 10% per annum compounded daily, and shall be paid prior and in preference to any pro rata distribution to the holders of Telesat Partnership Units. If a holder of Telesat Partnership Units exchanges their Telesat Partnership Units for Telesat Corporation Shares, the holder will continue to be entitled to any unpaid deferred distribution.

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Telesat Partnership is also required to make certain tax distributions to holders of Telesat Partnership Units; provided, however, that Telesat Corporation may defer such distributions, which shall then accumulate at the rate of 10% per annum compounded daily, and shall be paid prior and in preference to any pro rata distribution to the holders of Telesat Partnership Units.

So long as any Telesat Partnership Units are outstanding, the Class D Units will not participate in, or be entitled to, any distributions.

Amendments to the Partnership Agreement

Subject to the right of the general partner to amend the Partnership Agreement described below, the Partnership Agreement shall only be amended in writing and, from and after the Effective Time, only with the consent of all of the following (i) the shareholders of Telesat Corporation by resolution passed by a simple majority of all votes cast at a meeting by holders entitled to vote at such meeting or by written consent of the Telesat Corporation shareholders holding in the aggregate a majority of the outstanding Telesat Corporation Shares; (ii) a majority of the holders of Telesat Partnership Units; (iii) the shareholders of Telesat Corporation (other than Red Isle and any MHR entity and their respective affiliates and associates) by resolution passed by a simple majority of all votes cast by such shareholders at a meeting by holders entitled to vote at such meeting or by written consent of such shareholders holding in the aggregate a majority of the outstanding Telesat Corporation Shares (other than shares held by Red Isle and any MHR entity and their respective affiliates and associates); and (iv) a majority of the holders of Telesat Partnership Units (other than those beneficially owned by Red Isle and any MHR entity and their respective affiliates and associates). However, any amendment seeking to convert Telesat Partnership into a general partnership will require unanimous written consent of the partners. Further, no amendment will give anyone other than the general partner the right to dissolve Telesat Partnership; no amendment will be made without the consent of the general partner which would adversely affect the rights and obligations of the general partner; and any amendment that disproportionately and adversely affects any individual, group or class of holders of units as compared to any other holder of units will require the consent of each holder of units so disproportionately and adversely affected.

Any amendments to the rights, privileges, restrictions and conditions attaching to the Telesat Partnership Units will require (i) in the case of amendments that would increase or decrease the economic rights of a Telesat Partnership Unit relative to the applicable class of Telesat Corporation Shares, approval by (A) an ordinary resolution passed by holders of the applicable class of Telesat Partnership Units, (B) a majority of the applicable class of Telesat Corporation Shares and (C) the general partner, (ii) in the case of any amendment (x) not covered by (i) and (y) that would affect the rights, privileges, restrictions or conditions attaching to certain of the Telesat Partnership Unit in a manner adverse to those holders of Telesat Partnership Units relative to other holders, with the approval of the holders of the adversely affected Telesat Partnership Units and the general partner, or (iii) in the case of any other amendment that would affect the rights privileges, restrictions or conditions attaching to the Telesat Partnership Units, the general partner, provided that, until the date that the Contractual Designees (as defined in the Telesat Corporation Articles) nominated by PSP Investments and MHR pursuant to Article 10.2 of the Telesat Corporation Articles collectively constitute, in the aggregate, less than 50% of the members of the Telesat Corporation Board (the “Special Board Date”), the amendments set out in clause (iii) may only be made without the approval of any limited partner if approved by a majority of the Specially Designated Directors then in office.

The general partner may make the following amendments to the Partnership Agreement without the consent of the limited partners:

• A change in the name of Telesat Partnership, the location of Telesat Partnership’s principal place of business or the registered office of Telesat Partnership;

• The admission, substitution, withdrawal or removal of limited partners in accordance with the Partnership Agreement;

• A change that the general partner, acting reasonably, determines is necessary to qualify or continue the qualification of Telesat Partnership as a limited partnership which the limited partners have limited liability under the applicable laws;

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• A change that, in the sole discretion of the general partner, is reasonable and necessary or appropriate to enable partners to take advantage of, or not be detrimentally affected by, changes, proposed changes or differing interpretations with respect to Canadian or U.S. income tax regulations, legislation or interpretation;

• A change that the general partner, acting reasonably, determines to be necessary to satisfy any requirements, conditions or guidelines contained in any law;

• A change in the fiscal year or taxable year of Telesat Partnership and any other changes that the general partner determines to be necessary or appropriate as a result of a change in the fiscal year or taxable year of the Telesat Partnership;

• An amendment that the general partner, acting reasonably, determines to be necessary or appropriate in connection with the creation, authorization or issuance of any class or series of partnership interests or options, rights, warrants or appreciation rights relating to partnership interests pursuant to Section 3.4 of the Partnership Agreement; and

• Any amendment expressly permitted in the Partnership Agreement to be made by the general partner acting alone;

provided that certain of the amendments may only be made without the approval of any limited partner if approved by the majority of the Specially Designated Directors then in office.

From and after the Special Board Date, if neither any MHR entity nor PSP Investments is a 5% Holder, the general partner, with the approval of the Telesat Corporation Board, may amend any provision of the Partnership Agreement and execute, swear to, acknowledge, deliver, file and record whatever documents may be required in connection with that amendment, to reflect: (a) a change to cure any ambiguity or to correct or supplement any provisions contained in the Partnership Agreement which may be defective or inconsistent with any other provision contained in the Partnership Agreement, in each case, that does not adversely affect the limited partners in any material respect, (b) a change that the general partner, acting reasonably, determines (i) is necessary to satisfy any requirements, conditions or guidelines contained in any opinion, directive, order, ruling or regulation of any governmental authority, or (ii) is required to effect the intent of the provisions of the Partnership Agreement or is otherwise contemplated by the Partnership Agreement that does not adversely affect the limited partners in any material respect, (c) an amendment that is necessary, in the written opinion of outside counsel to Telesat Partnership, to prevent Telesat Partnership, or the general partner or its directors, officers, trustees or agents from having a material risk of being in any manner subjected to the provisions of the U.S. Investment Company Act of 1940, as amended, the U.S. Investment Advisers Act of 1940, as amended, or “plan asset” regulations adopted under the U.S. Employee Retirement Income Security Act of 1974, as amended, regardless of whether such are substantially similar to plan asset regulations currently applied or proposed by the U.S. Department of Labor, or (d) an amendment that the general partner, acting reasonably, determines to be necessary or appropriate to reflect and account for the formation by Telesat Partnership of, or investment by Telesat Partnership in, any corporation, partnership, joint venture, limited liability company or other entity, in connection with the conduct by Telesat Partnership of activities permitted by the Partnership Agreement that does not adversely affect the limited partners in any material respect.

Dissolution

Telesat Partnership will dissolve upon: (i) the deemed removal of the general partner (unless the general partner is replaced pursuant to the Partnership Agreement), (ii) the sale, exchange, or other disposition of all or substantially all of the property of Telesat Partnership, if approved in accordance with the Partnership Agreement or (iii) after the Effective Time, no Telesat Partnership Units or Class D Units remain outstanding (each, a “Dissolution Event”).

Telesat Partnership will not dissolve by reason of death, bankruptcy, insolvency, mental incompetency or other disability of any limited partner or upon the transfer of any Telesat Partnership Units. Further, no limited partner has the right to ask for the dissolution of Telesat Partnership, for the winding-up of its affairs or for the distribution of its assets.

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Upon a Dissolution Event:

• Telesat Corporation will give prior notice of the dissolution to each limited partner and the transfer agent.

• The receiver will:

◦ sell or otherwise dispose of the part of Telesat Partnership’s assets as the receiver considers appropriate;

◦ pay the debts and liabilities of Telesat Partnership and liquidation expenses;

◦ if there are any assets of Telesat Partnership remaining, distribute all property and cash in the following order:

▪ first, to Telesat Corporation until it has received an amount sufficient to satisfy certain costs and expenses of Telesat Corporation relating to its role as general partner of the business and affairs of Telesat Corporation that are conducted through the Telesat Partnership or any of its subsidiaries;

▪ second, to the partners of Telesat Partnership pro rata in accordance with their respective interests, subject to certain limitations; and

◦ satisfy all applicable formalities, including the filing of the declaration of dissolution.

In the event of a dissolution of Telesat Corporation, holders of Telesat Partnership Units or Class D Units would not be entitled to a distribution of any assets or property of Telesat Corporation.

General Partner Exculpation and Liability

Telesat Corporation, in its capacity as general partner of Telesat Partnership, has acknowledged that it will owe the same duties to the Telesat Partnership and the holders of Partnership Units as the board of directors of a British Columbia company owes to the company and its shareholders pursuant to sections 142(1)(a) and 142(1)(b) of the BCBCA and such additional non-waivable duties as provided under the Limited Partnerships Act (Ontario). Telesat Corporation will not be liable for any act or omission in its capacity as a general partner, except to the extent constituting a breach of the foregoing duties. To the extent that the Telesat Corporation Board is found to have breached its duties or obligation to the holders of Telesat Corporation Shares, it will be deemed to have breached its duties and obligations to the holders of Partnership Units, who will be afforded an equivalent remedy to any remedy provided to the holders of Telesat Corporation Shares.

Indemnity

Telesat Partnership will indemnify any party that is or has been a general partner of Telesat Partnership or any of its affiliates, or any current or former officer, director, employee, partner, agent or trustee of such general partner or its affiliates (or any person taking action at the direction of such a person) from and against any and all losses, claims, damages, liabilities joint or several expenses (including, without limitation, legal fees and expenses on a solicitor/client basis), judgments, fines, settlements and other amounts arising from any and all claims, demands, actions, suits or proceedings, whether civil, criminal, administrative or investigative, in which such party is involved by reason of its status as a general partner of Telesat Partnership or as a current or former officer, director, employee, partner, agent or trustee of a general partner or its affiliates (or any person taking action at the direction of such a person). This indemnity is contingent on (i) the applicable indemnitee having acted honestly and in good faith with a view to the best interest of Telesat Partnership and, if applicable, its duties as general partner and (ii) in the case of a criminal or administrative action or proceeding that is enforced by monetary penalty, such indemnitee had reasonable grounds to believe its conduct was lawful. Further, if such indemnitee has been adjudged by a final decision of a court of competent jurisdiction that is no longer appealable to have failed to meet the applicable standard of conduct in the performance of, its obligations under the Partnership Agreement, they will not have the benefit of the indemnity described in this paragraph.

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Withholding Rights

Telesat Corporation, in its capacity as general partner, may cause Telesat Partnership or any of its affiliates to comply with any withholding requirements established under applicable laws. To the extent that Telesat Partnership is required to or elects to withhold and pay over to any taxing authority any amount resulting from the allocation or distribution of income to a holder of Telesat Partnership Units or to the extent that any payments made to Telesat Partnership Units are subject to withholding as a result of such payments being attributable to any particular holder of Telesat Partnership Units, Telesat Corporation may treat the amount withheld as a distribution of cash to such holder of Telesat Partnership Units in the amount of such withholding from or in respect of such holder.

Statutory Rights

Holders of Telesat Partnership Units have the right to exercise certain rights of shareholders of Telesat Corporation on an “as-if-exchanged” basis (i.e., such holders shall have the same rights as if they had exchanged their Telesat Partnership Units for Telesat Public Shares), including (i) rights of holders of Telesat Public Shares set forth in the Telesat Corporation Articles and under applicable law (other than voting rights and rights to dividends or other distributions) and (ii) statutory rights with respect to the inspection of books and records and shareholder lists, and make a shareholder requisition, to have a court call a shareholder meeting, to participate in a meeting telephonically and to submit shareholder proposals.

Disclosures Regarding Exemptions from Canadian Securities Law Requirements

Telesat Corporation has received exemptive relief from securities regulatory authorities in the provinces and territories of Canada (the “CSA”), such that:

(a) an offer to acquire outstanding Class A Shares or Class B Variable Voting Shares which would constitute a take-over bid under applicable securities legislation as a result of the securities subject to the offer to acquire, together with the offeror’s securities, representing in the aggregate 20% or more of the outstanding Class A Shares or Class B Variable Voting Shares, as the case may be, at the date of the offer to acquire, be exempt from the requirements set out in Part 2 of National Instrument 62-104 — Take-Over Bids and Issuer Bids (“NI 62-104”) applicable to take-over bids (the “TOB Relief”); provided that the securities subject to the offer to acquire, together with the offeror’s securities, would not represent in the aggregate 20% or more of the outstanding Class A Shares and Class B Variable Voting Shares, as the case may be, calculated using (i) a denominator comprised of all of the outstanding Class A Shares and Class B Variable Voting Shares, determined in accordance with subsection 1.8(2) of NI 62-104 on a combined basis, as opposed to a per-class basis, and (ii) a numerator including as offeror’s securities all of the Class A Shares and Class B Variable Voting Shares, as applicable, that constitute offeror’s securities;

(b) an acquiror who acquires, during a take-over bid or an issuer bid, beneficial ownership of, or control or direction over, Class A Shares or Class B Variable Voting Shares, as the case may be, that, together with the acquiror’s securities of that class, would constitute 5% or more of the outstanding Class A Shares or Class B Variable Voting Shares, as the case may be, be exempt from the requirement set out in section 5.4 of NI 62-104 to issue and file a news release (the “News Release Relief”); provided that the Class A Shares or Class B Variable Voting Shares, as the case may be, that the acquiror acquires beneficial ownership of, or control or direction over, when added to the acquiror’s securities of that class, would not constitute 5% or more of the outstanding Class A Shares or Class B Variable Voting Shares, as the case may be, calculated using (i) a denominator comprised of all of the outstanding Class A Shares and Class B Variable Voting Shares, determined in accordance with subsection 1.8(2) of NI 62-104 on a combined basis, as opposed to a per-class basis, and (ii) a numerator including as acquiror’s securities, all of the Class A Shares and Class B Variable Voting Shares, as applicable, that constitute acquiror’s securities;

(c) an acquiror who triggers the disclosure and filing obligations pursuant to the early warning requirements set out in applicable securities legislation with respect to the Class A Shares or Class B Variable Voting Shares, as the case may be, be exempt from such requirements (the “Early Warning Relief”); provided that (i) the acquiror complies with the early warning requirements, except that, for the purpose of determining the percentage of outstanding Class A Shares or Class B Variable Voting Shares, as the case may be, that the acquiror has acquired or disposed of beneficial ownership, or acquired or ceased to have control or direction over, the acquiror calculates the percentage using (A) a denominator comprised of all of the outstanding

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Class A Shares and Class B Variable Voting Shares, determined in accordance with subsection 1.8(2) of NI 62-104, on a combined basis, as opposed to a per-class basis, and (B) a numerator including, as acquiror’s securities, all of the Class A Shares and Class B Variable Voting Shares, as applicable, that constitute acquiror’s securities; or (ii) in the case of an acquiror that is an eligible institutional investor, the acquiror complies with the requirements of the alternative monthly reporting system set out in Part 4 of National Instrument 62-103 — The Early Warning System and Related Take-Over Bid and Insider Reporting Issues (“NI 62-103”) to the extent it is not disqualified from filing reports thereunder pursuant to section 4.2 of NI 62-103, except that, for purposes of determining the acquiror’s securityholding percentage, the acquiror calculates its securityholding percentage using (A) a denominator comprised of all of the outstanding Class A Shares and Class B Variable Voting Shares determined in accordance with subsection 1.8(2) of NI 62-104 on a combined basis, as opposed to a per-class basis, and (B) a numerator including all of the Class A Shares and Class B Variable Voting Shares, as applicable, beneficially owned or controlled by the eligible institutional investor;

(d) an issuer bid made by the Company in the normal course on a published market, other than a designated exchange, with respect to Class A Shares or Class B Variable Voting Shares, as the case may be, be exempt from the requirements in Part 2 of NI 62-104 applicable to issuer bids (the “NCIB Relief” and, together with the TOB Relief, the News Release Relief and the Early Warning Relief, the “Bid Relief”); provided that the Company complies with the conditions in subsection 4.8(3) of NI 62-104, except that: (i) the bid is for not more than 5% of the outstanding Class A Shares and Class B Variable Voting Shares on a combined basis, as opposed to a per class basis, and (ii) the aggregate number of Class A Shares and Class B Variable Voting Shares acquired in reliance on the NCIB Relief by the Issuer and any person acting jointly or in concert with the Issuer within any 12-month period does not exceed 5% of the outstanding Class A Shares and Class B Variable Voting Shares on a combined basis, as opposed to a per-class basis, at the beginning of such 12-month period; and

(e) the Company be exempt (the “Alternative Disclosure Relief”, and together with the Bid Relief, the “Aggregation Relief”) from the disclosure requirements in Item 6.5 of Form 51-102F5 — Information Circular(“Form 51- 102F5”); provided that the Company provides the disclosure required by Item 6.5 of Form 51-102F5 except that for the purposes of determining the percentage of voting rights attached to the Class A Shares or Class B Variable Voting Shares, the Issuer calculates the voting percentage using (i) a denominator comprised of all of the outstanding Class A Shares and Class B Variable Voting Shares on a combined basis, as opposed to a per class basis, and (ii) a numerator including all of the Class A Shares and Class B Variable Voting Shares beneficially owned, or over which control or direction is exercised, directly or indirectly, by any person who, to the knowledge of the Issuer’s directors or executive officers, beneficially owns, controls or directs, directly or indirectly, voting securities carrying 10% or more of the voting rights attached to the outstanding Class A Shares and Class B Variable Voting Shares on a combined basis, as opposed to a per-class basis.

Telesat Corporation has also received exemptive relief from: (i) subsections 12.2(3) and 12.2(4) of NI 41-101; (ii) Item 1.13(1) of Form 41-101F1; (iii) Item 1.12(1) of Form 44-101F1 — Short Form Prospectus (including in respect of any equivalent disclosure in a prospectus or prospectus supplement filed pursuant to National Instrument 44-102 — Shelf Distributions); (iv) subsection 10.1(a), 10.1(4) and 10.1(6) of National Instrument 51-102 — Continuous Disclosure Obligations (“NI 51-102”); and (v) subsections 2.3(1)(1.), 2.3(1)(3.) and 2.3(2) of Ontario Securities Commission Rule 56-501 — Restricted Shares, in each case relating to the use of restricted security terms; provided that (a) the Class B Variable Voting Shares be referred to as “Class B Variable Voting Shares”, (b) the Class C Limited Voting Shares be referred to as “Class C Limited Voting Shares”, and (c) the Class B Units be referred to as “Class B Units” (the “Nomenclature Relief”). In connection with the Nomenclature Relief, the Company has filed an undertaking with the Ontario Securities Commission (the “OSC”) pursuant to which it has agreed that until such time that the articles of the Company are amended to remove the Super Voting Shares from the Company’s authorized share capital, no Super Voting Shares will be issued.

In addition, the Aggregation Relief and the Nomenclature Relief require that the Company disclose such relief and their terms and conditions in each of its annual information forms and management information circulars filed on SEDAR+ and in any other filing where the characteristics of its securities are described.

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Telesat Partnership received from the CSA exemptive relief from the continuous disclosure requirements of NI 51-102, allowing Telesat Partnership to satisfy its Canadian continuous disclosure obligations by relying on the Canadian continuous disclosure documents filed by Telesat Corporation, for so long as certain conditions are satisfied. In connection therewith, Telesat Partnership received an exemption from the requirements of National Instrument 52-109 — Certification of Disclosure in Issuers’ Annual and Interim Filings (the “Certification Requirements”), the requirements of National Instrument 52-110 — Audit Committees (the “Audit Committee Requirements”) and the requirements of National Instrument 58-101 — Disclosure of Corporate Governance Practices (the “Corporate Governance Requirements”) permitting Telesat Partnership to also satisfy the Certification Requirements, Audit Committee Requirements, and Corporate Governance Requirements by relying on the continuous disclosure documents prepared and certified by the Company and the audit committee and corporate governance practices implemented by the Company.

Telesat Partnership also received from the CSA exemptive relief from the “insider reporting requirements” (as defined in under National Instrument 14-101 — Definitions) in respect of Telesat Partnership; provided that, among other things, (i) a filer insider complies with the conditions in sections 13.3(3)(a) and (c) of NI 51-102 and (ii) the Company and the Partnership continue to satisfy relief granted to the Company and the Partnership in respect of certain continuous disclosure requirements.

The Company has also filed an undertaking with the OSC pursuant to which it has agreed to provide reasonable prior notice to the OSC in the event the Company intends to issue a series of preferred shares that: (a) carry a greater number of votes on a per share basis, irrespective of the number or percentage of preference shares owned, than the Telesat Corporation Shares or (b) would cause any of the factors set out in section 4.1 of OSC Rule 56-501 — Restricted Shares to be present in relation to the Telesat Corporation Shares regardless of any existing restrictions on the Telesat Corporation Shares due to the existence of the preferred shares.

Additionally, to satisfy certain disclosure conditions to the exemptive relief that Telesat Partnership received from the CSA, we are providing a summary of certain terms of Telesat Partnership’s Class A units, Class B units, and Class C units (together, the “Exchangeable Units”). This summary is not complete and is qualified in its entirety by the complete text of the Partnership Agreement and the Trust Voting Agreement, copies of which are available on SEDAR+ at https://www.sedarplus.ca and at https://www.sec.gov.

The Exchangeable Units of the Partnership are intended to provide economic rights that are substantially equivalent, and voting rights with respect to the Company that are equivalent, to the corresponding rights afforded to holders of Class A Shares, Class B Variable Voting Shares and Class C Shares. Under the terms of the Partnership Agreement, the rights, privileges, restrictions and conditions attaching to the Exchangeable Units include the following:

• The Exchangeable Units are now exchangeable at any time, at the option of the holder, on a one-for-one basis for the corresponding class of the Telesat Corporation Shares.

• After making distributions to the Company required pursuant to the Partnership Agreement for expenses related to taxes, operations, administration, and contractual obligations, the Partnership may make pro rata distributions to each Exchangeable Unit and the Company based on the respective number of outstanding Issuer Shares and outstanding Exchangeable Units at the time of distribution.

• If the Company issues the Telesat Corporation Shares in the form of a dividend or distribution on the Telesat Corporation Shares, the Partnership will issue to each holder of Exchangeable Units, in respect of each Exchangeable Unit held by such holder, a number of Exchangeable Units equal to the number of Telesat Corporation Shares issued in respect of each Telesat Corporation Share.

• If the Company issues or distributes rights, options or warrants or other securities or assets of the Company to all or substantially all of the holders of Telesat Corporation Shares, the Partnership is required to make a corresponding distribution to holders of the Exchangeable Units.

• No subdivision or combination of the outstanding shares of Telesat Corporation Shares is permitted unless a corresponding subdivision or combination of Exchangeable Units is made.

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• The Company and its board of directors are prohibited from proposing or recommending an offer for the Telesat Corporation Shares or for the Exchangeable Units unless the holders of the Exchangeable Units and the holders of the Telesat Corporation Shares are entitled to participate to the same extent and on equitably equivalent basis.

• Upon a dissolution and liquidation of the Partnership, if Exchangeable Units remain outstanding and have not been exchanged for the corresponding class of the Telesat Corporation Shares, then the distribution of the assets of the Partnership between holders of Telesat Corporation Shares and holders of Exchangeable Units will be made on a pro rata basis based on the number of Telesat Corporation Shares and Exchangeable Units outstanding. Prior to this pro rata distribution, the Partnership is required to pay to the Company sufficient amounts to fund the expenses or other obligations of the Company to ensure that any property and cash distributed to the Company in respect of the Telesat Corporation Shares will be available for distribution to holders of Telesat Corporation Shares in an amount per share equal to distributions in respect of each Exchangeable Unit.

• Approval of holders of the Exchangeable Units is required for an action (such as an amendment to the Partnership Agreement) that would affect the economic rights of an Exchangeable Unit relative to Telesat Corporation Shares.

• The holders of Exchangeable Units are indirectly entitled to vote in respect of matters on which holders of Telesat Corporation Shares are entitled to vote through Special Voting Shares of the Company. The Special Voting Shares are held by a trustee, entitling the trustee to that number of votes on matters on which holders of Telesat Corporation Shares are entitled to vote equal to the number of Exchangeable Units outstanding. The trustee is required to cast such votes in accordance with voting instructions provided by the Company on behalf of holders of Exchangeable Units in accordance with the Trust Voting Agreement. The trustee will exercise each vote attached to the Special Voting Shares only as directed by the Company on behalf of the relevant holder of Exchangeable Units.

C. Material Contracts

The following is a summary of each material contract, other than contracts entered into in the ordinary course of business, to which we are a party, for the two years immediately preceding the date of this Annual Report.

(a) Amendment No. 7, dated as of May 9, 2023, to the Credit Agreement, dated as of March 28, 2012, as amended by Amendment No. 1 on April 2, 2013, as further amended by Amendment No. 2 on November 17, 2016, as further amended by Amendment No. 3 on December 19, 2016, as further amended by Amendment No. 4 on February 1, 2017, as further amended by Amendment No. 5 on April 26, 2018 and as further amended by Amendment No. 6 on December 6, 2019, by and among Telesat Canada, Telesat LLC, the guarantors party thereto, the lenders party thereto and JP Morgan Chase Bank, N.A., as administrative agent, and collateral agent, and the swingline lenders and L/C Issuers and the other financial institutions and other parties party thereto.

D. Exchange Controls

We are not aware of any governmental laws, decrees, regulations or other legislation in Canada that restrict the export or import of capital, including the availability of cash and cash equivalents for use by our affiliated companies, or that affect the remittance of dividends, interest or other payments to non-resident holders of our securities.

E. Taxation

Certain Material U.S. Federal Income Tax Considerations

The following discussion is a summary of certain material U.S. federal income tax consequences to holders of Telesat Public Shares or Telesat Partnership Units of the ownership and disposition of such Telesat Public Shares or Telesat Partnership Units. The discussion is based on and subject to the Code, the U.S. Department of the Treasury regulations promulgated thereunder, administrative guidance and court decisions, in each case as of the date hereof, all of which are subject to change, possibly with retroactive effect. The discussion assumes that the holders will hold their Telesat Public Shares or Telesat Partnership Units (as applicable), as “capital assets” within the meaning of

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Section 1221 of the Code (generally, property held for investment). The discussion does not constitute tax advice and does not address all aspects of U.S. federal income taxation that may be relevant to particular holders of Telesat Public Shares, or Telesat Partnership Units in light of their personal circumstances, including any tax consequences arising under the U.S. federal 3.8-percent (3.8%) Medicare contribution tax on net investment income, or to any holders subject to special treatment under the Code, such as:

• banks, thrifts, mutual funds and other financial institutions;

• real estate investment trusts and regulated investment companies;

• traders in securities who elect to apply a mark-to-market method of accounting;

• tax-exempt organizations or governmental organizations;

• insurance companies;

• dealers or brokers in securities or foreign currency;

• individual retirement and other deferred accounts;

• U.S. Holders (as defined below) whose functional currency is not the U.S. dollar;

• U.S. expatriates and former citizens or long-term residents of the U.S.;

• “passive foreign investment companies” or “controlled foreign corporations,” and corporations subject to the accumulated earnings tax;

• persons subject to the alternative minimum tax;

• U.S. Holders who actually or constructively own or are deemed to own ten percent (10%) or more of Telesat Public Shares;

• persons who hold their shares as part of a straddle, hedge, constructive sale or other risk reduction transaction;

• persons who purchase or sell their shares as part of a wash sale for tax purposes;

• partnerships or other entities or arrangements classified as partnerships for U.S. federal income tax purposes, or other pass-through entities (and investors therein); and

• persons who received their shares through the exercise of employee stock options or otherwise as compensation or through a tax-qualified retirement plan.

No opinions of counsel and no rulings from the IRS have been or are intended to be sought by Telesat Corporation or Telesat Partnership with respect to the matters discussed herein. (As described below, Loral received an opinion of special tax counsel as to certain tax matters.) There can be no assurance that the IRS or a court will not take a contrary position regarding the tax consequences described herein. The discussion does not address any non-income tax considerations or any foreign, state or local tax consequences.

For purposes of this discussion, a “U.S. Holder” means a beneficial owner of Telesat Public Shares or Telesat Partnership Units that, for U.S. federal income tax purposes, is:

• an individual who is a citizen or resident of the U.S.;

• a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) created or organized in the U.S., any state thereof or the District of Columbia;

• an estate the income of which is subject to U.S. federal income taxation regardless of its source; or

• a trust, if (1) a court within the U.S. is able to exercise primary supervision over the administration of the trust and one or more U.S. persons have the authority to control all substantial decisions of the trust or (2) the trust has a valid election in effect under applicable U.S. Department of the Treasury regulations to be treated as a U.S. person.

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A “Non-U.S. Holder” means a beneficial owner of Telesat Public Shares or Telesat Partnership Units who is an individual, corporation, estate or trust, in each case, that is not a U.S. Holder.

If a partnership (or any arrangement or entity treated as a partnership for U.S. federal income tax purposes) holds Telesat Public Shares or Telesat Partnership Units, the tax treatment of a partner in the partnership will generally depend upon the status of the partner and the activities of the partnership. A holder that is a partnership for U.S. federal income tax purposes and the partners in such partnership are urged to consult their tax advisors about the U.S. federal income tax consequences of the ownership and disposition of Telesat Public Shares and Telesat Partnership Units.

THIS DISCUSSION IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT TAX ADVICE. HOLDERS OF TELESAT PUBLIC SHARES OR TELESAT PARTNERSHIP UNITS SHOULD CONSULT THEIR TAX ADVISORS WITH RESPECT TO THE U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE OWNERSHIP AND DISPOSITION OF THEIR TELESAT PUBLIC SHARES OR TELESAT PARTNERSHIP UNITS IN LIGHT OF THEIR PARTICULAR CIRCUMSTANCES, AS WELL AS ANY TAX CONSEQUENCES ARISING UNDER TAX LAWS OTHER THAN THOSE PERTAINING TO INCOME TAX, INCLUDING ESTATE OR GIFT TAX LAWS, OR UNDER ANY STATE, LOCAL OR NON-U.S. TAX LAWS OR UNDER ANY APPLICABLE INCOME TAX TREATY.

Application of Section 7874 of the Code

Overview of Section 7874

Section 7874 of the Code generally targets transactions in which an entity treated as a U.S. corporation for U.S. federal income tax purposes is acquired by a non-U.S. corporation or publicly traded partnership (an “inversion transaction”). Section 7874 comprises two alternative sets of rules. Which set of rules applies depends on how much of the non-U.S. acquirer’s stock the historic stockholders of the acquired U.S. corporation own following the inversion transaction. One set of rules under Section 7874 treats the acquiring non-U.S. corporation or publicly traded partnership as a U.S. corporation for U.S. federal income tax purposes if (in addition to other requirements) after the acquisition, the former stockholders of the acquired U.S. corporation hold at least eighty percent (80%) (by vote or value) of the shares of the acquiring non-U.S. entity by reason of holding shares of the acquired U.S. corporation. The other set of rules imposes a tax on the “inversion gain” (as defined below) of the acquired U.S. corporation, and potentially certain other taxes, if, in addition to other requirements, after the transaction, the former stockholders of the acquired U.S. corporation hold at least sixty percent (60%) (by vote or value) of the shares of the acquiring non-U.S. entity by reason of holding shares of the acquired U.S. corporation.

80% Ownership Test: Treatment of Telesat Corporation or Telesat Partnership as a U.S. Corporation

Under Section 7874 of the Code, a non-U.S. corporation or publicly traded partnership is treated as a U.S. corporation for U.S. federal income tax purposes if each of the following three conditions is met: (i) after the acquisition of a U.S. corporation, the former stockholders of the acquired U.S. corporation hold at least eighty percent (80%) (by vote or value) of the shares of the acquiring non-U.S. entity by reason of holding shares of the acquired U.S. corporation (the “80% Ownership Test”); (ii) the non-U.S. entity acquires, directly or indirectly, or is treated as acquiring under applicable U.S. Department of the Treasury regulations, substantially all of the assets held, directly or indirectly, by a U.S. corporation (the “Acquisition Requirement”); and (iii) after the acquisition, the acquiring non-U.S. entity does not satisfy the “Substantial Business Activities Test”.

A non-U.S. acquiror satisfies the Substantial Business Activities Test if its “expanded affiliated group” (generally, a group of corporations and partnerships including the non-U.S. acquiror that is connected by more than 50% ownership) has substantial business activities in its country of organization or incorporation as compared to the expanded affiliated group’s total business activities. An expanded affiliated group will be treated as having substantial business activities in the relevant foreign country as compared to its total business activities if, in general, at least twenty-five percent (25%) of the expanded affiliated group’s employees (by number and compensation), asset value, and gross income are based, located, and derived, respectively, in the relevant foreign country. It is not clear that the “expanded affiliated group” that includes Telesat Corporation and Telesat Partnership would satisfy the minimum threshold of activity required to meet the Substantial Business Activities Test. Accordingly, it has been assumed that the Substantial Business Activities Test would not be satisfied.

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If Section 7874 applied to treat Telesat Corporation or Telesat Partnership as a U.S. corporation for U.S. federal income tax purposes, such entity would be subject to U.S. federal tax return filing requirements and subject to U.S. federal income tax on its worldwide income, and certain distributions made by Telesat Corporation or Telesat Partnership, as applicable, to Non-U.S. Holders would be subject to U.S. withholding tax. Any foreign taxes, including Canadian taxes, paid by such entity would generally be creditable subject to several limitations, which limitations could be material.

In connection with the Transaction, Loral received an opinion from special tax counsel that neither Telesat Corporation nor Telesat Partnership should be treated as a U.S. corporation upon consummation of the Transaction because Telesat Corporation should not simultaneously satisfy the Acquisition Requirement and the 80% Ownership Test, and Telesat Partnership should not be treated as a publicly traded partnership nor should it satisfy the 80% Ownership Test.

The above-mentioned opinion is not binding on the IRS or any court and does not preclude the IRS or a court from reaching a contrary conclusion. Therefore, no assurance can be provided that the IRS will agree with the conclusions in the opinion. Further, the above-mentioned opinion does not consider any legislative proposals to lower the threshold for the 80% Ownership Test to 50% (or some other percentage). It is possible that such legislative proposals, if enacted, might be applied on a retroactive basis, with no grandfather clause for transactions executed pursuant to a binding commitment entered into prior to such legislation’s enactment.

The remaining discussion assumes that Telesat Corporation will not be treated as a U.S. corporation for U.S. federal income tax purposes and that Telesat Partnership will be treated as a non-U.S. partnership that is not a publicly traded partnership for U.S. federal income tax purposes.

60% Ownership Test: Treatment of Loral as an Expatriated Entity

If neither Telesat Corporation nor Telesat Partnership is treated as a U.S. corporation on account of the 80% Ownership Test described above, Section 7874 of the Code contains an alternative set of rules that results in a non-U.S. corporation or publicly-traded partnership being treated as a “surrogate foreign corporation” and an acquired U.S. corporation being treated as an “expatriated entity,” if: (i) the non-U.S. acquiror satisfies the Acquisition Requirement described above; (ii) after the acquisition, the former stockholders of the acquired U.S. corporation hold at least sixty percent (60%) (by vote or value) of the shares of the non-U.S. acquiror by reason of holding shares of the U.S. acquired corporation (the “60% Ownership Test”); and (iii) after the acquisition, the non-U.S. acquiror does not satisfy the Substantial Business Activities Test.

If Loral were treated as an expatriated entity under this test, then certain items of its taxable income that constitute “inversion gain” (generally gain from the transfer of shares or other property that is not inventory and income from the license of property to related foreign persons) recognized during the ten (10) year period following the inversion transaction would not be offset by its tax attributes, if any, including foreign tax credit or net operating loss carryforwards. Additionally, if Loral were to become an expatriated entity during the ten (10) year period following the enactment of the Tax Cuts and Jobs Act, on December 22, 2017, it would be required to recapture any deduction it claimed under Section 965(c) of the Code (relating to the reduced rate of tax applied to the deemed repatriation of previously untaxed foreign earnings). Further, any dividends paid by Telesat Corporation to U.S. Holders who are individuals would not be eligible for the reduced rate of tax on qualified dividend income under Section 1(h)(11) of the Code.

If Telesat Partnership were treated as a publicly traded partnership, as of the consummation of the Transaction it is expected that the Acquisition Requirement as well as the 60% Ownership Test would be satisfied. In that case, Telesat Partnership would be treated as a surrogate foreign corporation and Loral as an expatriated entity under Section 7874.

As indicated above, Loral has received an opinion from special tax counsel that Telesat Partnership should not be treated as a publicly traded partnership and, accordingly, should not be treated as a surrogate foreign corporation upon consummation of the Transaction. The opinion relies, in part, on the following facts, representations or assumptions:

• Interests in Telesat Partnership will not be traded on an established securities market.

• Other than certain affiliate transactions permitted to allow for holding structure modifications without changes to beneficial ownership, and other than interfamily transfers for the purpose of estate planning, holders of Telesat Partnership Units will not be permitted to sell or exchange Telesat Partnership Units,

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and Telesat Partnership will not recognize any sales or exchanges, to the extent such exchange or transfer would cause Telesat Partnership to be treated as a publicly traded partnership for U.S. federal income tax purposes.

• Telesat Partnership Units will be exchangeable for Telesat Public Shares, but such exchanges should not facilitate or otherwise effect, in form or substance, a partner-to-partner exchange of interests in Telesat Partnership, as the exchanges will merely shift the direct ownership interest of a partner to an indirect ownership interest through an already existing partner, Telesat Corporation.

The opinion concludes that, based on certain representations as to the mix of Telesat Partnership Units and Telesat Public Shares to be received in the Merger by certain institutional holders of Loral stock, Telesat Corporation should not satisfy the Acquisition Requirement upon consummation of the Transaction and, accordingly, should not be treated as a surrogate foreign corporation, although that conclusion is not free from doubt. If the Acquisition Requirement were satisfied, it is possible that the 60% Ownership Test would be simultaneously satisfied. In that case, Telesat Corporation would be treated as a surrogate foreign corporation and Loral as an expatriated entity under Section 7874.

Further, if either Telesat Corporation or Telesat Partnership were treated as a surrogate foreign corporation and, as a result, Loral were treated as an expatriated entity, Loral would not be able to offset any inversion gain using foreign tax credits or net operating losses, which could increase its potential U.S. tax liability with respect to such inversion gain. It is not anticipated that Loral will experience any material inversion gain upon or subsequent to the Transaction.

Absent a change in facts and circumstances or law, it is anticipated that Telesat Corporation will eventually become a surrogate foreign corporation, and that Loral will become an expatriated entity, upon the exchange of a sufficient number of Telesat Partnership Units for Telesat Public Shares to cause both the 60% Ownership Test and the Acquisition Requirement to be satisfied. If Loral were determined to be an expatriated entity prior to December 22, 2027, Loral would be required to pay an additional tax under Section 965(l) of the Code to recapture the deduction it claimed on its 2017 U.S. federal income tax return under Section 965(c) of the Code. Section 965(l) imposes a tax equal to thirty-five percent (35%) of the amount of the Section 965(c) deduction in the first taxable year in which an entity becomes expatriated, and disallows the ability to offset such tax with any credits. It is estimated that the amount of tax due with respect to such recapture would be US$38,500,000. The actual tax liability under Section 965(l) is dependent on the post-1986 deferred foreign income of each of the deferred foreign income corporations with respect to which Loral is a U.S. shareholder. If the IRS were to successfully challenge the amount of deferred foreign income of any of the deferred foreign income corporations the amount of tax due under Section 965(l) could be more than the estimated amount.

Additionally, if Telesat Corporation were determined to be a surrogate foreign corporation, dividends paid by Telesat Corporation would not be treated as qualified dividend income under Section 1(h)(11) of the Code. Accordingly, non-corporate U.S. Holders of Telesat Public Shares would be subject to tax on such dividends at ordinary income rates of up to 37%, and not at the preferential 20% rate applicable under Section 1(h)(11).

Certain Material U.S. Federal Income Tax Considerations to U.S. Holders of Telesat Public Shares

Taxation of Distributions on Telesat Public Shares

Subject to the discussion below under “— Passive Foreign Investment Company Status,” the gross amount of cash distributions on Telesat Public Shares should be taxable to U.S. Holders as dividend income to the extent of Telesat Corporation’s earnings and profits (as determined for U.S. federal income tax purposes). With respect to non-corporate U.S. Holders (including individuals), dividends received from Telesat Corporation should be subject to U.S. federal income tax at preferential rates, provided that certain holding period requirements and other conditions are satisfied and that Telesat Corporation is not determined to be a surrogate foreign corporation. U.S. Holders that are corporations generally will not be eligible for the dividends received deduction with respect to dividends received from Telesat Corporation.

To the extent that the amount of any distribution exceeds Telesat Corporation’s earnings and profits, the excess will first be treated as a tax-free return of capital (with a corresponding reduction in the adjusted tax basis of a U.S. Holder’s Telesat Public Shares) up to the amount thereof, and then as capital gain recognized on a taxable disposition.

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Dividends paid in a currency other than U.S. dollars generally will be included in a U.S. Holder’s gross income in a U.S. dollar amount based on the spot exchange rate in effect on the date of actual or constructive receipt, whether or not the payment is converted into U.S. dollars at that time. The U.S. Holder generally will have a tax basis in such currency equal to such U.S. dollar amount, and any gain or loss recognized upon a subsequent sale or conversion of the foreign currency for a different U.S. dollar amount generally will be U.S. source ordinary income or loss. If the dividend is converted into U.S. dollars on the date of receipt, a U.S. Holder generally should not be required to recognize foreign currency gain or loss in respect of the dividend income.

Dividends received from Telesat Corporation by a U.S. Holder who is a qualified resident of the U.S. under the Convention Between the United States of America and Canada With Respect to Taxes on Income and Capital, signed September 26, 1980, as amended (the “U.S.-Canada Tax Treaty”) generally will be subject to withholding tax in Canada at a rate of fifteen percent (15%). Any Canadian withholding tax should generally be creditable against the U.S. tax that would otherwise be imposed on the dividend income. The ability to claim the credit, however, is subject to several limitations.

Taxation of Dispositions of Telesat Public Shares

Subject to the discussion below under “— Passive Foreign Investment Company Status,” for U.S. federal income tax purposes, a U.S. Holder should recognize taxable gain or loss on any sale or other taxable disposition of Telesat Public Shares in an amount equal to the difference between the amount realized from such sale or other taxable disposition and the U.S. Holder’s adjusted tax basis in such shares. Such recognized gain or loss generally will be capital gain or loss. Capital gains of non-corporate U.S. Holders will be subject to U.S. federal income tax at preferential rates if the U.S. Holder has held the Telesat Public Shares for more than one year as of the date of the sale or other taxable disposition. The deductibility of capital losses is subject to limitations. Any gain or loss recognized by a U.S. Holder on the sale or other taxable disposition of Telesat Public Shares generally will be treated as U.S. source gain or loss.

Passive Foreign Investment Company Status

Notwithstanding the foregoing, certain adverse U.S. federal income tax consequences could apply to a U.S. Holder if Telesat Corporation is treated as a passive foreign investment company (“PFIC”) for any taxable year during which the U.S. Holder holds Telesat Public Shares. A non-U.S. corporation, such as Telesat Corporation, will be classified as a PFIC for U.S. federal income tax purposes for any taxable year in which, after applying certain look-through rules, either (i) seventy-five percent (75%) or more of its gross income for such year consists of certain types of “passive” income or (ii) fifty percent (50%) or more of the value of its assets (determined on the basis of a quarterly average) during such year produces or is held for the production of passive income. In addition, direct or indirect foreign corporate subsidiaries of Telesat Corporation could be treated as PFICs. In such a case, U.S. Holders would generally be treated as owning an indirect equity interest in any such subsidiary PFICs and could be subject to certain adverse tax consequences.

Under the PFIC look-through rules, for the purposes of determining whether a corporation should be classified as a PFIC, the corporation will be treated as if it owns a proportionate share of the assets of, and earns a proportionate share of the income earned by, any subsidiary corporation if the corporation owns at least twenty-five percent (25%) (by value) of the stock of such subsidiary. Furthermore, for purposes of these rules stock owned by a partnership is treated as owned proportionately by its partners. Under applicable Treasury Regulations, if a corporation owns less than twenty-five percent (25%) (by value) of a partnership, the corporation’s interest in the partnership is, in general, treated as a passive asset and its income flowing through from partnership is passive income. During 2021 after the Transaction and during a portion of 2022, Telesat Corporation owned only approximately twenty-four percent (24%) of the Telesat Partnership Units (representing its percentage interest in Telesat Partnership and indirectly in the wholly owned corporate subsidiaries of Telesat Partnership). Telesat Corporation’s ownership interest in Telesat Partnership increased during 2022, and subsequently. As of December 31, 2022 and December 31, 2023, respectively, Telesat Corporation’s ownership interest in Telesat Partnership was 25.7% and 27.2%. While not free from doubt, Telesat Corporation believes that, by virtue of additional value associated with its interest as general partner of Telesat Partnership, Telesat Corporation owned at least twenty-five percent (25%) of the total value of Telesat Partnership (and indirectly in the wholly owned corporate subsidiaries of Telesat Partnership) during 2021 and 2022. In addition, Telesat Corporation owned more than 25% of the total value of Telesat Partnership (and indirectly in the wholly owned corporate subsidiaries of Telesat Partnership) during 2023. Telesat Corporation believes it was not a PFIC for any of

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its 2021-2023 taxable years, taking into account the income and assets of the wholly owned corporate subsidiaries of Telesat Partnership. Telesat Corporation can provide no assurance that the IRS will not successfully challenge this position upon any audit of a U.S. Holder.

The determination as to whether Telesat Corporation should be classified as a PFIC for 2024 and years thereafter will be a factual determination that must be made annually at the close of each taxable year and will be based upon the composition of Telesat Corporation’s income and assets (including entities in which Telesat Corporation holds at least a 25% interest by value), which may be subject to change. Because PFIC status is determined annually based on Telesat Corporation’s income and assets for the entire taxable year, it is not possible to determine whether Telesat Corporation will be characterized as a PFIC for 2024 or any other future year until after the close of that year. While Telesat Corporation intends to manage its business so as to avoid PFIC status to the extent possible and consistent with its other business goals, Telesat Corporation cannot predict whether its business plans will allow it to avoid PFIC status. In addition, because the market price of the Telesat Public Shares has fluctuated and is likely to fluctuate in the future and because that market price may affect the determination of whether Telesat Corporation is a PFIC, there can be no assurance that Telesat Corporation will not be a PFIC for any taxable year.

If Telesat Corporation is a PFIC, a U.S. Holder that does not make an election to treat Telesat Corporation as a qualified electing fund (“QEF Election”) or did not make a mark-to-market election (“Mark-to-Market Election”) (both elections described more fully below) will be required to pay tax on the U.S. dollar value of any gain on the disposition of its Telesat Public Shares at ordinary income rates, rather than capital gains rates, and to compute the tax liability on such gain and any Excess Distribution (as defined below) received in respect of the Telesat Public Shares as if such items had been earned ratably over each day in the U.S. Holder’s holding period (or a certain portion thereof) for the Telesat Public Shares. The U.S. Holder will be subject to tax on such gain or Excess Distributions at the highest ordinary income tax rate for each taxable year in which such gain or Excess Distributions are treated as having been earned, other than the current year (for which the U.S. Holder’s regular ordinary income tax rate will apply), regardless of the rate otherwise applicable to the U.S. Holder (and without reduction by otherwise available tax attributes in the prior years, such as net operating loss carry forwards). In addition to the tax at ordinary income rates, such U.S. Holder will also be liable for a non-deductible interest charge in respect of the taxes deemed to have been deferred for prior taxable years. Furthermore, if Telesat Corporation is a PFIC, the preferential tax rate applicable to qualified dividend income derived by certain non-corporate U.S. Holders would not apply to dividends paid with respect to Telesat Public Shares. For purposes of these rules, gifts, exchanges pursuant to corporate reorganizations, certain other transfers, and use of the Telesat Public Shares as security for a loan may be treated as taxable dispositions of such Telesat Public Shares. In addition, a stepped-up basis in the Telesat Public Shares will not be available upon the death of an individual U.S. Holder who has not made a timely QEF Election with respect to Telesat Corporation.

For purposes of the foregoing rules, the amount by which the U.S. dollar value of distributions during a taxable year in respect of a Telesat Public Share exceeds 125% of the average amount of distributions in respect thereof during the three preceding taxable years (or, if shorter, the U.S. Holder’s holding period for the Telesat Public Shares) is an “Excess Distribution”.

QEF Election

A U.S. Holder that makes a timely and effective QEF Election with respect to Telesat Public Shares, referred to in this disclosure as an “Electing U.S. Holder,” will not be subject to the adverse U.S. tax consequences discussed above with respect to such shares. Instead, an Electing U.S. Holder must include in income such shareholder’s pro rata share of Telesat Corporation’s ordinary earnings and net capital gain, if any, for Telesat Corporation’s taxable year that ends with or within the taxable year of the Electing U.S. Holder and in which Telesat Corporation is a PFIC. The amount so included in income generally will be treated as ordinary income to the extent of such Electing U.S. Holder’s allocable share of the PFIC’s ordinary earnings and as long-term capital gain to the extent of such Electing U.S. Holder’s allocable share of the PFIC’s net capital gains. If an Electing U.S. Holder is an individual, any such net capital gain inclusions would be eligible for taxation at the preferential capital gain tax rates. Such income inclusions generally will be treated as income from sources outside of the U.S. for foreign tax credit purposes.

A QEF Election will apply to the taxable year for which such QEF Election is timely made and to all subsequent taxable years, unless such QEF Election is invalidated or terminated or the IRS consents to revocation of such QEF Election. If a U.S. Holder makes a QEF Election and, in a subsequent taxable year Telesat Corporation ceases to be a PFIC, the QEF Election will remain in effect (although it will not be applicable) during those taxable years in which

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Telesat Corporation is not a PFIC. Accordingly, if Telesat Corporation becomes a PFIC in another subsequent taxable year, the QEF Election will be effective and the Electing U.S. Holder will be subject to the QEF rules described above during any subsequent taxable year in which Telesat Corporation qualifies as a PFIC.

If a U.S. Holder holds Telesat Public Shares during any taxable year for which Telesat Corporation is classified as a PFIC which was not a QEF, then Telesat Corporation will generally continue to be classified as a PFIC for any subsequent taxable year during which the U.S. Holder continues to hold Telesat Public Shares, even if Telesat Corporation’s income or assets do not cause it to be a PFIC for such subsequent taxable year. However, this rule does not apply if the U.S. Holder elects to recognize gain on the Telesat Public Shares (as of the last day of the last taxable year for which Telesat Corporation is a PFIC).

Telesat Corporation will use reasonable efforts to provide U.S. Holders with such information as may be required to make a QEF Election with respect to their ownership of Telesat Public Shares (including with respect to any of its subsidiaries that is a PFIC). Each U.S. Holder should consult its own tax advisors regarding tax consequences of making or not making a QEF Election with respect to Telesat Corporation and any subsidiary PFIC.

Mark-to-Market Election

Alternatively, if Telesat Public Shares are “marketable stock,” a U.S. Holder generally would be permitted to make a Mark-to-Market Election. Generally, stock will be considered “marketable stock” if it is “regularly traded” on a “qualified exchange” within the meaning of applicable U.S. Department of the Treasury regulations. A class of stock is “regularly traded” on an exchange during any calendar year in which such class of stock is traded, other than in de minimis quantities, on at least 15 days during each calendar quarter. A “qualified exchange” includes: (i) a national securities exchange that is registered with the SEC, (ii) the national market system established pursuant to section 11A of the Exchange Act, or (iii) a foreign securities exchange that is regulated or supervised by a governmental authority of the country in which the market is located, provided that (a) such foreign exchange has trading volume, listing, financial disclosure, and surveillance requirements, and meets other requirements and the laws of the country in which such foreign exchange is located, together with the rules of such foreign exchange, ensure that such requirements are actually enforced and (b) the rules of such foreign exchange effectively promote active trading of listed stocks. It is expected that the Telesat Public Shares will constitute marketable stock under these rules, although no assurance can be given.

If a Mark-to-Market Election is made, the U.S. Holder generally would include as ordinary income in each taxable year the excess, if any, of the fair market value of the Telesat Public Shares at the end of the taxable year over such U.S. Holder’s adjusted tax basis in the Telesat Public Shares. The U.S. Holder would also be permitted an ordinary loss in respect of the excess, if any, of the U.S. Holder’s adjusted tax basis in the Telesat Public Shares over their fair market value at the end of the taxable year, but only to the extent of the net amount previously included in income as a result of the Mark-to-Market Election. A U.S. Holder’s tax basis in the Telesat Public Shares would be adjusted to reflect the amount included in gross income or allowed as a deduction because of the Mark-to-Market Election. Gain realized on the sale, exchange, or other disposition of the Telesat Public Shares would be treated as ordinary income, and any loss realized on the sale, exchange, or other disposition of the Telesat Public Shares would be treated as ordinary loss to the extent that such loss does not exceed the net mark-to-market gains previously included in income by the U.S. Holder. Losses that exceed this limitation are subject to the rules generally applicable to losses provided in the Code and U.S. Department of the Treasury Regulations. Amounts treated as ordinary income are not eligible for the preferential tax rates applicable to qualified dividend income or long-term capital gains.

A U.S. Holder makes a Mark-to-Market Election by attaching a completed IRS Form 8621 to a timely filed U.S. federal income tax return. A Mark-to-Market Election applies to the taxable year in which such Mark-to-Market Election is made and to each subsequent taxable year, unless the Telesat Public Shares cease to be marketable stock or the IRS consents to revocation of such election. If a U.S. Holder does not make a Mark-to-Market Election beginning in the first taxable year of such U.S. Holder’s holding period for the Telesat Public Shares for which Telesat Corporation is a PFIC and such U.S. Holder has not made a timely QEF Election, the adverse tax consequences discussed above will apply to certain dispositions of, and distributions on, the Telesat Public Shares. Each U.S. Holder should consult its own tax advisors regarding the availability of, and procedure for making, a Mark-to-Market Election.

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Although a U.S. Holder may be eligible to make a Mark-to-Market Election with respect to the Telesat Public Shares, no such election may be made with respect to the stock of any subsidiary PFIC that a U.S. Holder is treated as owning, because such stock is not marketable. Hence, the Mark-to-Market Election will not be effective to avoid the application of the adverse tax consequences described above with respect to deemed dispositions of subsidiary PFIC stock or excess distributions from a subsidiary PFIC to its shareholder.

A U.S. Holder who is a direct or “indirect” holder of stock of a PFIC must file an IRS Form 8621 in respect of such PFIC for a taxable year in the circumstances described in the United States Treasury Regulations. U.S. Holders are encouraged to consult their tax advisors regarding the application of the PFIC rules to their investment in Telesat Public Shares and. concerning the availability and consequences of making or not making any of the elections mentioned above, as well as concerning their annual filing requirements.

Medicare Tax

A United States person that is an individual or estate, or a trust that does not fall into a special class of trusts that is exempt from such tax, is subject to a 3.8% tax on net investment income in excess of certain amounts. In the case of an individual, the tax is imposed on the lesser of (1) the United States person’s “net investment income” for the relevant taxable year and (2) the excess of the United States person’s modified adjusted gross income for the taxable year over US$250,000 (in the case of a taxpayer filing a joint return or a surviving spouse), US$125,000 (in the case of a married taxpayer filing a separate return) or US$200,000 (in any other case). In the case of an estate or trust, the tax is imposed on the lesser of (1) the entity’s “undistributed net investment income” for the taxable year and (2) the excess (if any) of the entity’s “adjusted gross income” over the dollar amount at which the highest tax bracket begins for such entity. A holder’s net investment income will include its gross dividend income and its net gains from the disposition of Telesat Public Shares unless such dividends or net gains are derived in the ordinary course of the conduct of a trade or business (other than a trade or business that consists of certain passive or trading activities). U.S. Holders that are individuals, estates or trusts are encouraged to consult their tax advisors regarding the applicability of the Medicare tax to their income and gains in respect of their investment in Telesat Public Shares.

Information with Respect to Foreign Financial Assets

Individuals who own “specified foreign financial assets” with an aggregate value in excess of US$50,000 are required to file an information report with respect to such assets with their tax returns. “Specified foreign financial assets” include any financial accounts maintained by foreign financial institutions, as well as any of the following, but only if they are not held in accounts maintained by financial institutions: (i) stocks and securities, including Telesat Public Shares. issued by non-U.S. persons, (ii) financial instruments and contracts held for investment that have non-U.S. issuers or counterparties and (iii) interests in foreign entities. U.S. Holders that are individuals are encouraged to consult their tax advisors regarding the application of this reporting requirement as it relates to their ownership of Telesat Public Shares.

Certain Material U.S. Taxation Considerations to U.S. Holders of Telesat Partnership Units

Allocation and Taxation of Telesat Partnership’s Profits and Losses

If, as anticipated, Telesat Partnership is treated as a partnership for U.S. federal income tax purposes, it will not be a taxable entity. Instead, each U.S. Holder in computing such holder’s U.S. federal income tax liability for a taxable year will be required to include its allocable share of items of Telesat Partnership’s income, gain, loss, deduction and credit for the Telesat Partnership’s taxable year ending with or within the taxable year of such U.S. Holder, regardless of whether the holder has received any distributions from Telesat Partnership. The characterization of an item of Telesat Partnership’s income, gain, loss, deduction or credit generally will be determined at Telesat Partnership’s (rather than at the holder’s) level and then such characterization will be passed through to the holders as if it derived such items directly.

A U.S. Holder’s allocable share of Telesat Partnership’s items of income, gain, loss, deduction and credit will be determined by the Partnership Agreement, provided such allocations either have “substantial economic effect” or are determined to be in accordance with the holder’s interest in Telesat Partnership. If the allocations provided by the Partnership Agreement were successfully challenged by the IRS, the redetermination of the allocations to a particular holder for U.S. federal income tax purposes could be less favorable than the allocations set forth in the Partnership Agreement.

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Telesat Partnership may derive taxable income that is not matched by a corresponding receipt of cash. This could occur because of differences in the rules for recognizing income for book and tax purposes. To the extent that there is a discrepancy between Telesat Partnership’s recognition of income and Telesat Partnership’s receipt of the related cash and distribution of the same to the holders of Telesat Partnership Units, it is possible that the U.S. federal income tax liability of a U.S. Holder with respect to its allocable share of Telesat Partnership’s earnings in a particular taxable year could exceed the cash distributions to the U.S. Holder for the year, thus giving rise to an out-of-pocket payment by the U.S. Holder.

Section 706 of the Code provides that items of partnership income and deductions must be allocated between transferors and transferees of partnership interests. Telesat Partnership will apply certain assumptions and conventions in an attempt to comply with applicable rules and to report income, gain, loss, deduction and credit to holders in a manner that reflects such holders’ beneficial share of Telesat Partnership items and that takes into account any exchanges of Telesat Partnership Units for Telesat Public Shares. These conventions are designed to more closely align the receipt of cash and the allocation of income between holders of Telesat Partnership Units, but these assumptions and conventions may not be in compliance with all aspects of applicable tax requirements. In addition, as a result of such allocation method, a holder may be allocated taxable income even if such holder does not receive any distributions.

If Telesat Partnership’s conventions are not allowed by the U.S. Department of the Treasury regulations (or only apply to transfers of less than all of a holder’s shares) or if the IRS otherwise does not accept Telesat Partnership’s conventions, the IRS may contend that Telesat Partnership’s taxable income or losses must be reallocated among the holders of interests in Telesat Partnership. If such a contention were sustained, certain U.S. Holders’ respective tax liabilities would be adjusted to the possible detriment of certain other U.S. Holders. The general partner of Telesat Partnership (i.e., Telesat Corporation) is authorized to revise Telesat Partnership’s method of allocation between transferors and transferees (as well as among holders whose interests otherwise could vary during a taxable period).

If items of income or gain allocated to a U.S. Holder are subject to income tax in Canada, the U.S. Holder of Telesat Partnership Units may generally credit the Canadian income tax against tax that would otherwise be imposed on the income or gain by the U.S. The ability to claim the credit, however, is subject to several limitations.

Adjusted Tax Basis of Telesat Partnership Units

A U.S. Holder’s adjusted tax basis in its Telesat Partnership Units generally will (a) be increased by the U.S. Holder’s allocable share of (i) items of Telesat Partnership’s income and gain and (ii) increases in Telesat Partnership’s liabilities, if any, and (b) be decreased, but not below zero, by (i) distributions from Telesat Partnership, (ii) the U.S. Holder’s allocable share of items of Telesat Partnership’s deductions and losses, and (iii) the U.S. Holder’s allocable share of the reduction in Telesat Partnership’s liabilities, if any.

A U.S. Holder is allowed to deduct its allocable share of Telesat Partnership’s losses (if any) only to the extent of such U.S. Holder’s adjusted tax basis in Telesat Partnership Units it is treated as holding at the end of the taxable year in which the losses occur. If the recognition of a U.S. Holder’s allocable share of Telesat Partnership’s losses would reduce its adjusted tax basis for its Telesat Partnership Units below zero, the recognition of the portion of the losses that would reduce the U.S. Holder’s adjusted tax basis below zero would be deferred to subsequent taxable years and will be allowed if and when such U.S. Holder has sufficient tax basis so that such losses would not reduce such U.S. Holder’s adjusted tax basis below zero.

Treatment of Telesat Partnership’s Cash Distributions

Distributions of cash by Telesat Partnership generally will not be taxable to a U.S. Holder for U.S. federal income tax purposes to the extent of such U.S. Holder’s adjusted tax basis (described above) in its Telesat Partnership Units. Any cash distributions in excess of a U.S. Holder’s adjusted tax basis generally will be considered to be gain from the sale or exchange of Telesat Partnership Units, as described below.

Treatment of Exchanges of Telesat Partnership Units for Telesat Public Shares and Other Dispositions of Telesat Partnership Units

Holders of Telesat Partnership Units may elect to exchange (and, in certain circumstances, may be required to exchange) their Telesat Partnership Units for Telesat Public Shares. Such an exchange (or, generally, any other sale or exchange of Partnership Units) will result in the recognition of gain or loss in an amount equal to the difference,

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if any, between (i) the fair market value of Telesat Public Shares (or other consideration) received, plus the amount of the U.S. Holder’s share of Telesat Partnership’s liabilities, if any, and (ii) the U.S. Holder’s adjusted tax basis in the Telesat Partnership Units exchanged.

Any gain or loss recognized with respect to such exchange generally will be treated as capital gain or loss and will be long-term capital gain or loss if the U.S. Holder’s holding period for its interest exceeds one year. A portion of such gain may be treated as ordinary income under the Code to the extent attributable to the U.S. Holder’s allocable share of unrealized gain or loss in Telesat Partnership’s assets to the extent described in Section 751 of the Code. Long-term capital gains of non-corporate U.S. Holders (including individuals) will be subject to U.S. federal income tax at preferential rates. The deductibility of capital losses is subject to limitations. Any gain or loss recognized by a U.S. Holder on an exchange of Telesat Partnership Units generally will be treated as U.S. source gain or loss.

A U.S. Holder’s holding period in the Telesat Public Shares received in the exchange will begin on the day after the exchange.

Limitation on Deductibility of Capital Losses

Any capital losses generated by Telesat Partnership and allocated to holders of Telesat Partnership Units will be deductible by U.S. Holders who are individuals only to the extent of such U.S. Holders’ capital gains for the taxable year plus up to US$3,000 of ordinary income (US$1,500 in the case of a married individual filing a separate return). Excess capital losses may be carried forward by individuals indefinitely. Any capital losses generated by Telesat Partnership will be deductible by corporate U.S. Holders to the extent of such holders’ capital gains for the taxable year. Corporations may carry capital losses back three years and forward five years. U.S. Holders should consult their tax advisors regarding the deductibility of capital losses.

Additional Limitations on Deductibility of Telesat Partnership’s Losses

As stated above, a U.S. Holder generally will be restricted from taking into account for U.S. federal income tax purposes its allocable share of any loss incurred by Telesat Partnership in excess of the adjusted tax basis of such U.S. Holder’s Telesat Partnership Units. In addition, certain U.S. Holders, including individuals, may be subject to various other limitations on their ability to use their allocable share of deductions and losses of Telesat Partnership. Such limitations include those relating to “passive activity losses,” amounts “at risk,” capital losses and itemized deductions. U.S. Holders may also be subject to limitations relating to “investment interest.”

Dual consolidated loss restrictions also may apply to limit the deductibility by a corporate U.S. Holder of losses incurred by Telesat Partnership. Corporate U.S. Holders of Telesat Partnership Units are urged to consult their own tax advisors regarding the applicability and effect to them of dual consolidated loss restrictions.

Partnership Representative

Telesat Corporation will act as Telesat Partnership’s “partnership representative.” Telesat Corporation’s actions as partnership representative, including its agreement to adjustments of Telesat Partnership’s income in settlement of an IRS audit of Telesat Partnership, will bind all partners in Telesat Partnership.

Information Returns

Telesat Partnership has agreed to use reasonable efforts to furnish Telesat Partnership Unit holders tax information as promptly as possible, which describes a holder’s allocable share of Telesat Partnership’s income, gain, loss and deduction for Telesat Partnership’s preceding taxable year. Delivery of this tax information by Telesat Partnership will be subject to delay in the event of, among other reasons, the late receipt of any necessary tax information from a subsidiary in which Telesat Partnership holds an interest. It is therefore possible that, in any taxable year, Telesat Partnership Unit holders will need to apply for extensions of time to file their tax returns. In preparing the tax information, Telesat Partnership will use various accounting and reporting conventions to determine a holder’s allocable share of income, gain, loss and deduction. The IRS may successfully contend that certain of these reporting conventions are impermissible, which could result in an adjustment to Telesat Partnership Unit holders’ income or loss.

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It is possible that Telesat Partnership may engage in transactions that subject Telesat Partnership and, potentially, the holders of Telesat Partnership Units to other information reporting requirements with respect to an investment in Telesat Partnership. A Telesat Partnership Unit holder may be subject to substantial penalties if it fails to comply with such information reporting requirements. Telesat Partnership Unit holders should consult with their tax advisors regarding such information reporting requirements.

Telesat Partnership may be audited by the IRS. Adjustments resulting from an IRS audit may require Telesat Partnership to adjust a prior year’s tax liability and may result in an audit of a Telesat Partnership Unit holder’s tax return. Any audit of a Telesat Partnership Unit holder’s tax return could result in adjustments not related to Telesat Partnership’s tax returns as well as those related to Telesat Partnership’s tax returns.

Information Reporting and Backup Withholding

Generally, a U.S. Holder of Telesat Partnership Units should not be subject to U.S. backup withholding tax, provided such U.S. Holder timely provides Telesat Partnership with a properly completed IRS Form W-9, including an accurate taxpayer identification number. In the case of any U.S. Holder subject to backup withholding, Telesat Partnership will withhold from such U.S. Holder at the applicable rate (currently twenty-four percent (24%) with respect to income derived through Telesat Partnership. Backup withholding is not an additional tax; the amount of any backup withholding with respect to income derived by a Telesat Partnership Unit holder through Telesat Partnership generally will be allowed as a credit against its U.S. federal income tax liability and may entitle it to a refund.

Publicly Traded Partnership

As discussed above, Loral has received an opinion from special tax counsel that Telesat Partnership should not be classified as a publicly traded partnership for U.S. federal income tax purposes. But even if Telesat Partnership were treated as a publicly traded partnership, it is anticipated that it should meet the qualifying income exception, described below, and so not be treated or taxable as a corporation for U.S. federal income tax purposes, unless it were treated as a U.S. corporation under Section 7874. (See “— Application of Section 7874 of the Code — 80% Ownership Test: Treatment of Telesat Corporation or Telesat Partnership as a U.S. Corporation,” above).

A publicly traded partnership will be treated as a partnership, and not as a corporation for U.S. federal income tax purposes, if ninety percent (90%) or more of its gross income during each taxable year consists of “qualifying income” within the meaning of Section 7704 of the Code and it is not required to register as an investment company under the Investment Company Act of 1940 (the “qualifying income exception”). Qualifying income generally includes dividends, interest, capital gains from the sale or other disposition of stocks and securities and certain other forms of investment income. It is expected that Telesat Partnership will earn qualifying income. However, no assurance can be given as to the types of income that will be earned in any given year.

If Telesat Partnership were treated as a publicly traded partnership and failed to satisfy the qualifying income exception (other than a failure which is determined by the IRS to be inadvertent and which is cured within a reasonable period of time after the discovery of such failure), it would be treated as if it had transferred all of its assets, subject to its liabilities, to a newly formed foreign corporation, on the first day of the year in which it failed to satisfy the qualifying income exception, in return for stock of the corporation, and then distributed such stock to the holders of Telesat Partnership Units in liquidation of their interests in Telesat Partnership. This contribution and liquidation would be taxable to U.S. Holders of Telesat Partnership Units, in whole or in part, in an amount not to exceed the excess of the fair market value of Telesat Partnership Units over their adjusted basis in the hands of the U.S. Holder.

Certain Material U.S. Income Tax Considerations to Non-U.S. Holders

Holding Telesat Public Shares

A Non-U.S. Holder generally should not be subject to U.S. federal income or withholding tax on dividends received from Telesat Corporation unless the dividends are effectively connected with the Non-U.S. Holder’s conduct of a trade or business in the U.S. (and, if an income tax treaty applies, the dividends are attributable to a permanent establishment or fixed place of business maintained by the Non-U.S. Holder in the U.S.).

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In addition, a Non-U.S. Holder generally will not be subject to U.S. federal income or withholding tax on any gain recognized on the sale, exchange or other disposition of Telesat Public Shares unless: (i) such gain is effectively connected with the conduct by the Non-U.S. Holder of a trade or business within the U.S. (or, if an income tax treaty applies, is attributable to a permanent establishment or fixed place of business maintained by the Non-U.S. Holder in the U.S.); or (ii) in the case of certain capital gains recognized by a Non-U.S. Holder that is an individual, such individual is present in the U.S. for 183 days or more during the taxable year in which the capital gain is recognized and certain other conditions are met.

Taxation of Non-U.S. Holders of Telesat Partnership Units

Non-U.S. Holders are subject to U.S. withholding tax at a thirty percent (30%) rate on the gross amount of interest, dividends and other fixed or determinable annual or periodical income received or derived through a partnership from sources within the U.S. unless such income is treated as effectively connected with a trade or business within the U.S. or the Non-U.S. Holder establishes that it is entitled to an exemption. The thirty percent (30%) rate may be reduced or eliminated under the provisions of an applicable income tax treaty between the U.S. and the country in which the Non-U.S. Holder resides or is organized. Whether a Non-U.S. Holder is eligible for treaty benefits will depend upon the provisions of the applicable treaty as well as the treatment of Telesat Partnership under the laws of the Non-U.S. Holder’s jurisdiction. Telesat Partnership will not itself be able to claim benefits under the U.S.-Canada Tax Treaty with respect to interest, dividends or other fixed or determinable annual or periodical income that it receives from Loral. The thirty-percent (30%) withholding tax rate does not apply to certain portfolio interest on obligations of U.S. persons allocable to certain non-U.S. persons. Non-U.S. Holders generally are not subject to U.S. federal income tax on capital gains, including such gains realized upon a disposition of assets by Telesat Partnership or gains realized upon a sale of the Telesat Partnership Units if (i) such gains are not effectively connected with the conduct of a U.S. trade or business of such Non-U.S. Holder; (ii) a tax treaty is applicable and such gains are not attributable to a permanent establishment in the U.S. maintained by such non-U.S. person; or (iii) such non-U.S. person is an individual and is not present in the U.S. for 183 or more days during the taxable year (assuming certain other conditions are met). However, a Non-U.S. Holder would be taxable on any gain, as deemed effectively connected income, on a sale of assets by Telesat Partnership or a sale of Telesat Partnership Units to the extent attributable to “United States real property interests,” including interests in any “U.S. real property holding corporation” (“USRPHC”). In this regard, Loral would be a USRPHC if the fair market value of its U.S. real property interests equals or exceeds fifty percent (50%) of the sum of the fair market value of its worldwide real property interests and other assets used or held for use in a trade or business, all as determined under applicable U.S. Department of the Treasury regulations. Based on the relatively insubstantial portion of Loral’s assets that is treated as U.S. real property interests, it is not expected that Loral has been or will be a USRPHC for U.S. federal income tax purposes.

In order to claim benefits under an applicable treaty, a Non-U.S. Holder must provide the applicable IRS Form W-8 to Telesat Partnership. If a Telesat Partnership Unit holder does not timely provide Telesat Partnership with IRS Form W-8, or such form is not properly completed, Telesat Partnership may be subject to U.S. withholding taxes in excess of what would have been imposed had the proper certifications been provided. Such excess may be treated by Telesat Partnership as an expense that will be borne by all Telesat Partnership Unit holders on a pro rata basis (where Telesat Partnership is or may be unable to allocate any such excess withholding tax cost in a cost-efficient fashion specifically to the holders that failed to timely provide the proper U.S. tax certifications).

A Non-U.S. Holder of Telesat Partnership Units may also be subject to U.S. backup withholding tax (at the applicable rate, currently twenty-four percent (24%)) with respect to income derived through Telesat Partnership unless such Non-U.S. Holder of Telesat Partnership Units (i) provides an appropriate IRS Form W-8 that such Non-U.S. Holder is not a U.S. person; (ii) is a corporation or falls within another exempt category and appropriately demonstrates this fact when required or (iii) provides a taxpayer identification number and certifies that such holder is exempt from backup withholding tax (on a properly completed applicable IRS Form) and otherwise complies with the applicable requirements of the backup withholding tax rules. Backup withholding is not an additional tax; the amount of any backup withholding with respect to income derived by a Non-U.S. Holder of Telesat Partnership Units generally will be allowed as a credit against any U.S. federal income tax liability to which it is subject and may entitle it to a refund.

Prospective Non-U.S. Holders of Telesat Partnership Units are urged to consult their tax advisors with regard to the U.S. federal income tax consequences to them of acquiring, holding and disposing of Telesat Partnership Units and the effects of state, local and non-U.S. tax laws, as well as eligibility for any reduced withholding benefits.

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Information Returns

Telesat Partnership has agreed to use reasonable efforts to furnish Telesat Partnership Unit holders tax information as promptly as possible, which describes a holder’s allocable share of Telesat Partnership’s income, gain, loss and deduction for Telesat Partnership’s preceding taxable year. There can be no assurance that this tax information will meet the compliance requirements of a Non-U.S. Holder’s jurisdiction. Delivery of this tax information by Telesat Partnership will be subject to delay in the event of, among other reasons, the late receipt of any necessary tax information from a subsidiary in which Telesat Partnership holds an interest. It is therefore possible that, in any taxable year, Telesat Partnership Unit holders will need to apply for extensions of time to file their tax returns. In preparing the tax information, Telesat Partnership will use various accounting and reporting conventions to determine a holder’s allocable share of income, gain, loss and deduction. The IRS may successfully contend that certain of these reporting conventions are impermissible, which could result in an adjustment to Telesat Partnership Unit holders’ income or loss.

Telesat Partnership may be audited by the IRS. Adjustments resulting from an IRS audit may require Telesat Partnership to adjust a prior year’s tax liability, and may result in an audit of a Telesat Partnership Unit holder’s tax return. Any audit of a Telesat Partnership Unit holder’s tax return could result in adjustments not related to Telesat Partnership’s tax returns as well as those related to Telesat Partnership’s tax returns.

Certain Material Canadian Tax Implications for Non-Canadian Holders

The following summary describes, as of the date hereof, the principal Canadian federal income tax considerations under the Income Tax Act (Canada) (the “Tax Act”) generally applicable to the holding and disposing of Telesat Public Shares and the holding and disposing of Telesat Partnership Units, generally applicable to a beneficial owner who, at all relevant times, for the purposes of the Tax Act, (i) is not, and is not deemed to be, resident in Canada, (ii) does not use or hold, and is not deemed to use or hold the Telesat Public Shares or the Telesat Partnership Units, as applicable, in a business carried on in Canada, (iii) deals at arm’s length with, and is not affiliated with, Telesat Corporation or Telesat Partnership, as applicable and (iv) holds such Telesat Public Shares or Telesat Partnership Units, as applicable, as “capital property” (referred to in this summary as a “Non-Canadian Holder”). Generally, Telesat Public Shares and Telesat Partnership Units will be capital property to a Non-Canadian Holder, provided that the Non-Canadian Holder does not hold such securities in the course of carrying on a business of dealing in securities or as part of an adventure or concern in the nature of trade. Special rules, which are not discussed in this summary, may apply to a Non-Canadian Holder that is an “authorized foreign bank” within the meaning of the Tax Act or an insurer carrying on an insurance business in Canada and elsewhere. Any such Non-Canadian Holder should consult its own tax advisor.

This summary is not applicable to a Non-Canadian Holder that has entered or enters into a “derivative forward agreement” (as defined in the Tax Act) with respect to the Telesat Public Shares or the Telesat Partnership Units. Any such Non-Canadian Holder should consult its own tax advisor with respect to an investment in the Telesat Public Shares or the Telesat Partnership Units.

This summary is based on the current provisions of the Tax Act, the regulations promulgated thereunder (the “Tax Regulations”), and the administrative policies and assessment practices of the Canada Revenue Agency (the “CRA”) published in writing by the CRA prior to the date hereof. This summary also takes into account all specific proposals (the “Tax Proposals”) to amend the Tax Act and the Tax Regulations publicly announced by or on behalf of the Minister of Finance (Canada) prior to the date hereof. No assurances can be given that the Tax Proposals will be enacted in the form announced or at all. This summary does not otherwise take into account or anticipate changes in law, whether by judicial, governmental or legislative action or decision, or any changes in the administrative policies or assessment practices of the CRA, nor does it take into account other federal or any provincial, territorial or foreign tax legislation or considerations, which may differ from the Canadian federal income tax considerations described herein. This summary is not exhaustive of all possible Canadian federal income tax considerations that may affect Non-Canadian Holders.

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Accordingly, this summary is of a general nature only and is not intended to be, nor should it be construed to be, legal or tax advice to any particular Non-Canadian Holder, and no representation with respect to the Canadian federal income tax considerations to any particular Non-Canadian Holder is made.

Currency Conversion

For the purposes of the Tax Act, all amounts relating to the acquisition, holding or disposition of Telesat Public Shares or Telesat Partnership Units, including dividends, distributions, adjusted cost base and proceeds of disposition, must generally be expressed in Canadian dollars. Amounts denominated in a currency other than Canadian dollars must generally be converted into Canadian dollars based on the exchange rates determined in accordance with the Tax Act on the day such amounts arise.

Certain Material Canadian Federal Income Tax Considerations to Non-Canadian Holders of Telesat Public Shares

This portion of the summary describes the principal Canadian federal income tax considerations generally applicable to a Non-Canadian Holder in respect of the holding or disposing of Telesat Public Shares.

This portion of the summary assumes that the Telesat Public Shares will not be “taxable Canadian property” (as defined in the Tax Act) to any particular Non-Canadian Holder at any time. Generally, the Telesat Public Shares will not constitute taxable Canadian property to a Non-Canadian Holder at a particular time provided that the shares are listed at that time on a designated stock exchange for purposes of the Tax Act (which includes the NASDAQ), unless at any particular time during the 60-month period that ends at that time (i) one or any combination of (a) the Non-Canadian Holder, (b) persons with whom the Non-Canadian Holder does not deal at arm’s length (for the purposes of the Tax Act), and (c) partnerships in which the Non-Canadian Holder or a person described in (b) holds a membership interest directly or indirectly through one or more partnerships, owned 25% or more of the issued shares of any class or series of the capital stock of Telesat Corporation, and (ii) more than 50% of the fair market value of Telesat Public Shares was derived directly or indirectly from one or any combination of: (a) real or immovable properties situated in Canada, (b) “Canadian resource properties”, (c) “timber resource properties”, and (d) options in respect of, or interests in, or for civil law rights in, any of the foregoing property whether or not the property exists, each term as defined in the Tax Act. Notwithstanding the foregoing, in certain circumstances set out in the Tax Act, Telesat Public Shares may be deemed to be taxable Canadian property.

Dividends on Telesat Public Shares

Dividends paid or credited or deemed to be paid or credited on the Telesat Public Shares to a Non-Canadian Holder will be subject to Canadian withholding tax at the rate of 25%, subject to any reduction in the rate of withholding to which the Non-Canadian Holder is entitled under any applicable income tax treaty or convention. For example, under the U.S.-Canada Tax Treaty, the rate of withholding tax on dividends paid or credited or deemed to be paid or credited to a Non-Canadian Holder who is beneficially entitled to such dividend, resident in the U.S. for purposes of the U.S.-Canada Tax Treaty and fully entitled to the benefits of the U.S.-Canada Tax Treaty is generally limited to 15% of the gross amount of the dividend. Non-Canadian Holders are urged to consult their own tax advisors to determine their entitlement to relief under an applicable income tax treaty.

Dispositions of Telesat Public Shares

A Non-Canadian Holder will not be subject to tax under the Tax Act on any capital gain realized on a disposition or deemed disposition of Telesat Public Shares, unless the Telesat Public Shares constitute taxable Canadian property of the Non-Canadian Holder and the Non-Canadian Holder is not entitled to relief under an applicable income tax treaty or convention.

Certain Material Canadian Federal Income Tax Considerations to Non-Canadian Holders of Telesat Partnership Units

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Taxation of Telesat Partnership

The Tax Act does not define what constitutes a partnership but does describe the income tax consequences where one exists. The CRA has stated that, generally, a partnership is the relation that subsists between persons carrying on business in common with a view to profit and that whether a particular arrangement at a particular time constitutes a partnership is a matter determined by relevant provincial law. Telesat Partnership is registered as a partnership under Ontario law, although formal registration as a partnership under applicable law is not in and of itself decisive.

As discussed below under “Income of Telesat Partnership”, it is not expected that Telesat Partnership will be considered for the purposes of the Tax Act to have income from carrying on a business within the meaning of the Tax Act. The CRA has acknowledged that the level of activity required to qualify as a partnership under provincial law may be lower than that required for income to be regarded for the purposes of the Tax Act as income from a business rather than income from property, which is consistent with the relevant case law. The balance of this summary assumes that Telesat Partnership is considered to be a partnership for the purposes of the Tax Act.

SIFT Rules

Telesat Partnership is a “SIFT partnership” for the purposes of the Tax Act. As a SIFT partnership, Telesat Partnership will be subject to partnership level taxation (“SIFT Tax”) on its “taxable non-portfolio earnings”, which generally include (i) income from businesses carried on in Canada, (ii) income (other than taxable dividends) from “non-portfolio property”, and (iii) taxable capital gains from dispositions of “non-portfolio property”, each term as defined in the Tax Act. The SIFT Tax is applied to such income and taxable capital gains at a rate similar to the federal and provincial rate generally applicable to a Canadian corporation. If Telesat Partnership were to have “taxable non-portfolio earnings”, the excess of its taxable non-portfolio earnings over its SIFT Tax payable for a taxation year would be deemed to be a dividend received by Telesat Partnership in the taxation year from a taxable Canadian corporation, which deemed dividend would be allocated to holders of Telesat Partnership Units in accordance with the Partnership Agreement. The portion of the deemed dividend allocated to a Non-Canadian Holder would be subject to Canadian withholding tax. For a discussion of the taxation of dividends from a taxable Canadian corporation, see the discussion above under “Material Canadian Federal Income Tax Considerations to Non-Canadian Holders of Telesat Public Shares”.

It is expected that Telesat Partnership’s only material assets will be shares of Telesat CanHoldco, which will be non-portfolio property, Loral series B preferred stock (the “Loral Preferred Stock”), which may also be non-portfolio property, and cash. Dividends received by Telesat Partnership on shares of Telesat CanHoldco or Loral Preferred Stock will be taxable dividends and excluded from taxable non-portfolio earnings. Telesat Partnership does not expect to dispose of the shares of Telesat CanHoldco or the Loral Preferred Stock otherwise than on a tax-deferred rollover basis and, therefore, does not expect to realize capital gains on the disposition of non-portfolio property.

Each of Loral and Loral Holdings will be a controlled foreign affiliate (as defined in the Tax Act) of Telesat Partnership. The Tax Act requires Telesat Partnership to include in income, in respect of each share owned by Telesat Partnership of the capital stock of a controlled foreign affiliate, as income from the share, the percentage of the “foreign accrual property income” or “FAPI” (as defined in the Tax Act) of any controlled foreign affiliate of Telesat Partnership, for each taxation year of the affiliate ending in the taxation year of Telesat Partnership, equal to that share’s “participating percentage” (as defined in the Tax Act) in respect of the affiliate, determined at the end of each such taxation year of the affiliate (“FAPI Inclusion”), whether or not Telesat Partnership actually receives a distribution of that FAPI. If there were a FAPI Inclusion, subject to certain rules described below, Telesat Partnership would be entitled to deduct an amount in respect of any “foreign accrual tax” (as defined in the Tax Act) in respect of the amount (the FAPI Inclusion net of such deduction is referred to as the “Net FAPI Inclusion”). If Telesat Partnership receives a dividend on a share of the capital stock of a corporation that was at any time a controlled foreign affiliate of Telesat Partnership, Telesat Partnership may generally deduct, in computing its income for the year, the lesser of the amount of the dividend and the cumulative Net FAPI Inclusions (to the extent not previously deducted) (the “Subsection 91(5) Deduction”). It is expected that, if Can ULC were to pay a dividend to Loral Holdings (which would be included in computing the Net FAPI Inclusion), Loral Holdings and Loral would each pay sufficient dividends in the same taxation year with the effect that the Subsection 91(5) Deduction should offset the Net FAPI Inclusion such that it is expected that Telesat Partnership should not have any taxable non-portfolio earnings and should not be liable to pay SIFT Tax.

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If any Subsection 91(5) Deduction did not offset the Net FAPI Inclusion and the Loral Preferred Stock were non-portfolio property, Telesat Partnership would have taxable non-portfolio earnings and would be required to pay SIFT Tax for the relevant taxation year. Please see risk factors under “Canadian Tax Risks”. In such case, each person who is a partner of Telesat Partnership in the year will generally be required to file a tax return under Part IX.1 of the Tax Act. However, a tax return filed by any partner will be deemed to have been made by each partner of Telesat Partnership. Under the Partnership Agreement, Telesat Corporation, as general partner of Telesat Partnership, is required to file the necessary return.

Computation of Income or Loss of Telesat Partnership

Telesat Partnership is not subject to tax under the Tax Act except in the circumstances discussed above under “SIFT Rules”. However, the income or loss of Telesat Partnership will be computed for each fiscal year as if Telesat Partnership were a separate person resident in Canada and will be allocated to the partners of Telesat Partnership in the manner set out in the Partnership Agreement, subject to the detailed rules in the Tax Act (including the SIFT Rules) in that regard. The fiscal year of Telesat Partnership generally will be the calendar year.

In computing its income, Telesat Partnership will be required to include dividends received on the shares of Telesat CanHoldco and Loral Preferred Stock. Telesat Partnership will be deemed to be a non-resident person for the purposes of the Tax Act in respect of, among other things, dividends paid or credited by Telesat CanHoldco. The rate of withholding tax imposed under Part XIII of the Tax Act in respect of dividends is 25%. Pursuant to the administrative policy of the CRA, Telesat Partnership should not be subject to withholding tax on the portion of the dividends allocable to holders that are resident in Canada for the purposes of the Tax Act. However, there can be no assurance that the CRA will apply its administrative practice in this context. See “Canadian Tax Risks”.

The Tax Act contains anti-avoidance rules to address certain foreign tax credit generator transactions (the “Foreign Tax Credit Generator Rules”). Under certain Foreign Tax Credit Generator Rules, the “foreign accrual tax” (as defined in the Tax Act) applicable to a FAPI Inclusion of Telesat Partnership may be denied in certain specified circumstances, including where the direct or indirect share of the income of any member of Telesat Partnership that is a person resident in Canada or a “foreign affiliate” of such a person is, under a “relevant foreign tax law” (within the meaning attributed to it in the Tax Act), less than such member’s share of such income for purposes of the Tax Act. No assurance can be given that the Foreign Tax Credit Generator Rules will not apply to Telesat Partnership. If the Foreign Tax Credit Generator Rules apply, the “foreign accrual tax” applicable to a FAPI Inclusion will be denied.

The Partnership Agreement provides that the income for Canadian tax purposes of Telesat Partnership for a fiscal year to be allocated to a holder (after allocating an amount of income up to the special distribution made to Telesat Corporation in order to pay certain expenses) will generally be allocated pro rata in accordance with the partners’ proportionate share of distributions made in the year or, if no distributions are made, pro rata in accordance with their percentage interests in Telesat Partnership. If, with respect to a given fiscal year, Telesat Partnership has a loss for Canadian tax purposes, Telesat Corporation, as general partner, will allocate the loss of Telesat Partnership in such manner as it considers appropriate in the circumstances.

Information Returns

As Telesat Partnership will be a SIFT partnership, each person who is a partner of Telesat Partnership in a year will generally be required to file an information return on or before the last day of March in the following year in respect of the activities of Telesat Partnership or, where Telesat Partnership is dissolved, within 90 days of the dissolution. A return made by any partner will be deemed to have been made by each partner of Telesat Partnership. Under the Partnership Agreement, Telesat Corporation, as general partner of Telesat Partnership, is required to file the necessary return.

Taxation of Non-Canadian Holders of Telesat Partnership Units

This portion of the summary assumes that the Telesat Partnership Units will not be “taxable Canadian property” (as defined in the Tax Act) to any particular Non-Canadian Holder at any time and that Telesat Partnership will at no time dispose of taxable Canadian property. It is expected that Telesat Partnership’s only material assets will be shares of CanHoldco, shares of Loral Preferred Stock, and cash, none of which is expected to be taxable Canadian property. Generally, a partnership interest will not constitute taxable Canadian property to a non-Canadian holder unless at any particular time during the 60-month period that ends at that time more than 50% of the fair market value of the

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partnership interest was derived directly or indirectly from one or any combination of: (i) real or immovable properties situated in Canada, (ii) “Canadian resource properties”, (iii) “timber resource properties”, and (iv) options in respect of, or interests in, or for civil law rights in, any of the foregoing property whether or not the property exists, each term as defined in the Tax Act. Notwithstanding the foregoing, in certain circumstances set out in the Tax Act, partnership interests may be deemed to be taxable Canadian property.

Income of Telesat Partnership

Generally, a Non-Canadian Holder is subject to Canadian income tax under Part I of the Tax Act only on its share of Telesat Partnership’s income from carrying on business in Canada. The limited activities of Telesat Partnership contemplated should not, in and of themselves, cause a Non-Canadian Holder who holds Telesat Partnership Units to be considered to carry on, or to be deemed to carry on, business in Canada. Telesat Corporation, as general partner of Telesat Partnership, intends to conduct the affairs of Telesat Partnership, to the extent possible, such that Non-Canadian Holders who hold Telesat Partnership Units should not be considered to carry on business in Canada solely by virtue of holding Telesat Partnership Units; however, no assurance can be given in this regard. See “Canadian Tax Risks”.

Provided that a Non-Canadian Holder is not considered to be carrying on business in Canada by virtue of holding Telesat Partnership Units, the Non-Canadian Holder will not be required to file a Canadian income tax return solely as a result of its holding Telesat Partnership Units.

Telesat Partnership will be deemed to be a non-resident person for the purposes of the Tax Act in respect of, among other things, dividends paid or credited by Telesat CanHoldco. The rate of withholding tax imposed under Part XIII of the Tax Act in respect of dividends is 25%. However, the CRA’s administrative practice in similar circumstances is to permit the rate of Canadian federal withholding tax applicable to such payments to be computed by looking through the partnership and taking into account the residency of the partners (including partners who are resident in Canada) and any reduced rates of Canadian federal withholding tax that any non-resident partners may be entitled to under an applicable income tax treaty or convention, provided that the residency status and entitlement to treaty benefits can be established. In determining the rate of Canadian federal withholding tax applicable to amounts paid by Telesat CanHoldco to Telesat Partnership, Telesat CanHoldco will look through Telesat Partnership to the residency of its partners (including partners who are resident in Canada) and take into account any reduced rates of Canadian federal withholding tax that Non-Canadian Holders may be entitled to under an applicable income tax treaty or convention in order to determine the appropriate amount of Canadian federal withholding tax to withhold from dividends paid to Telesat Partnership. However, there can be no assurance that the CRA will apply its administrative practice in this context. See “Canadian Tax Risks”.

Disposition of Telesat Partnership Units

A Non-Canadian Holder will not be subject to tax under the Tax Act on any capital gain realized on a disposition or deemed disposition of Telesat Partnership Units, including if the Telesat Partnership Units are exchanged for Telesat Public Shares.

F. Dividends and Payment Agents

Not applicable.

G. Statement by Experts

Not applicable.

H. Documents on Display

This Annual Report and the related exhibits are available for viewing at our offices at 160 Elgin Street, Suite 2100, Ottawa, Ontario, K2P 2P7 telephone: (613) 748-8700. Copies of our financial statements and other continuous disclosure documents required under the Securities Act (Ontario) are available for viewing on SEDAR+ at https://www.sedarplus.ca. All of the documents referred to are in English.

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We are subject to the informational requirements of the Exchange Act and are required to file reports and other information with the SEC. You may read and copy this Annual Report on Form 20-F, including the related exhibits and schedules, and any document we file with the SEC through the SEC’s website at https://www.sec.gov.

As a foreign private issuer, we are exempt from the rules under the Exchange Act related to the furnishing and content of proxy statements, and our officers, directors and principal shareholders are exempt from the reporting and short-swing profit recovery provisions contained in Section 16 of the Exchange Act. Furthermore, as a foreign private issuer, we are not subject to the requirements of Regulation FD (Fair Disclosure) promulgated under the Exchange Act. In addition, we are not required under the Exchange Act to file annual or other reports and consolidated financial statements with the SEC as frequently or as promptly as U.S. companies whose securities are registered under the Exchange Act. Instead, we must file with the SEC, within four months after the end of each fiscal year, or such other applicable time as required by the SEC, an annual report on Form 20-F containing consolidated financial statements audited by an independent registered public accounting firm. We are also required to file or furnish with the SEC the continuous disclosure documents that we are required to file in Canada under Canadian securities laws.

We maintain a corporate website at http://www.telesat.com. Information contained on, or that can be accessed through, our website does not constitute a part of this Annual Report on Form 20-F. The information contained on our website is not incorporated by reference in this Annual Report.

I. Subsidiary Information

Not applicable.

J. Annual Report to Security Holders.

We intend to submit any annual report provided to security holders in electronic format as an exhibit to a current report on Form 6-K.

ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

A. Quantitative information about market risk.

The information called for by this Item may be found in “Item 5. Operating and Financial Review and Prospects”.

B. Qualitative information about market risk.

The information called for by this Item may be found in “Item 5. Operating and Financial Review and Prospects”.

ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

Not applicable.

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PART II

ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

None.

ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS

Not applicable.

ITEM 15. CONTROLS AND PROCEDURES

Disclosure controls and procedures

Evaluation of Disclosure Controls and Procedures

“Disclosure controls and procedures”, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities and Exchange Act of 1934, as amended (“Exchange Act”), are designed to provide reasonable assurance that information required to be disclosed is accumulated and communicated to management in a timely manner. As of December 31, 2023, Telesat Corporation conducted an evaluation under the supervision and with the participation of its management, including its Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of its disclosure controls and procedures. Based on this evaluation, Telesat’s Chief Executive Officer and Chief Financial Officer concluded that Telesat Corporation’s disclosure controls and procedures were effective as of December 31, 2023 to provide reasonable assurance that information required to be disclosed by it in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that information required to be disclosed in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our chief executive officer and chief financial officer, to allow timely decisions regarding required disclosure.

Management’s Report on Internal Control over Financial Reporting

Telesat’s management is responsible for establishing and maintaining adequate “internal control over financial reporting”, as such term is defined in Rule 13a-15(f) of the Exchange Act. Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements in a timely manner, and can provide only reasonable assurances that the objectives of the control system have been met. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with the underlying policies and procedures.

An evaluation of the effectiveness of Telesat’s internal control over financial reporting was conducted by Telesat’s management, under the supervision and with the participation of Telesat’s Chief Executive Officer and Chief Financial Officer, based on the framework set forth in the Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013. Based on this evaluation, Telesat’s Chief Executive Officer and Chief Financial Officer have concluded that Telesat’s internal control over financial reporting was effective as of December 31, 2023.

This annual report includes an attestation report of Telesat’s independent registered public accounting firm regarding internal control over financial reporting as well as the report of such independent registered public accounting firm regarding the company’s consolidated financial statements as of and for the year ended December 31, 2023.

Changes in Internal Control over Financial Reporting

During the period covered by this annual report, there have been no changes in Telesat Corporation’s internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, its internal control over financial reporting.

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ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT

The Telesat Corporation Audit Committee is composed of Michael Boychuk, who acts as chair of the committee, Jane Craighead and Henry Intven. Michael Boychuk, Jane Craighead and Henry Intven are persons determined by our board of directors to meet the independence requirements for audit committees under the rules of the NASDAQ and NI 52-110. Each of our Audit Committee members has an understanding of the accounting principles used to prepare financial statements and varied experience as to the general application of such accounting principles, as well as an understanding of the internal controls and procedures necessary for financial reporting. The board of directors has also determined that Michael Boychuk, Jane Craighead and Henry Intven are financially literate within the meaning of the rules and regulations of the NASDAQ and NI 52-110 and that they each qualify as an “audit committee financial expert” as defined under applicable SEC rules and regulations. For additional details regarding the relevant education and experience of each member of our Audit Committee, see Item 6. — “Directors, Senior Management and Employees”.

ITEM 16B. CODE OF ETHICS

Code of Ethics

The Telesat Corporation Board has a written code of ethics (the “Code of Ethics”) that applies to all officers, directors, employees, consultants, contractors and agents of Telesat Corporation and its affiliates and subsidiaries worldwide. The objective of the Code of Ethics is to provide guidelines for maintaining Telesat Corporation’s and its affiliates and subsidiaries’ integrity, trust and respect. The Code of Ethics addresses compliance with laws, rules and regulations, conflicts of interest, confidentiality, commitment, preferential treatment, financial information, internal controls and disclosure, protection and proper use of Telesat Corporation’s assets, communications, fair dealing, fair competition, due diligence, illegal payments, equal employment opportunities and harassment, privacy, use of company computers and the internet, political and charitable activities and the reporting of any violations of law, regulation or the Code of Ethics. Any person subject to the Code of Ethics is expected to report all violations of law, regulation or of the Code of Ethics of which they become aware to any one of Telesat Corporation’s senior executives. The Telesat Corporation Board has ultimate responsibility for monitoring compliance with the Code of Ethics. The Code of Ethics is posted on our website at https:// www.telesat.com and on SEDAR+ at https://www.sedarplus.ca. The information on or accessible through our website is not part of and is not incorporated by reference into this Annual Report, and the inclusion of our website address in this Annual Report is only for reference.

ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES

Principal Accountant Fees and Services

The following table summarizes the fees charged by Deloitte LLP (“Deloitte”) for services rendered to Telesat Corporation, including some of our subsidiaries, during the year ended December 31, 2023 (“Fiscal 2023”) and the year ended December 31, 2022 (“Fiscal 2022”).

(in thousands of Canadian dollars)	Fiscal 2023		Fiscal 2022
Audit fees(1)	$	3,351	$	3,934
Audit related fees(2)		229		240
Tax fees(3)		88		112
All other fee(4)		4		3
Total fees charged	$	3,672	$	4,289

____________

(1) Audit fees were for professional services rendered by Deloitte for the audit of Telesat’s annual financial statements and for the reviews of its quarterly financial statements for the year ended December 31, 2023 and 2022. In addition, in the year ended December 31, 2022, the fees included services associated with the proxy statement/prospectus in connection with the Transaction.

(2) The audit related fees for both periods also include fees for the audits of Telesat Canada’s pension plans, the French translation of the financial statements and for other miscellaneous audits.

(3) The 2023 and 2022 tax fees include amounts related to Scientific Research & Experimental Development tax credit services.

(4) The 2023 and 2022 other fees related to access to on-line accounting research services.

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Pre-Approval Policies and Procedures

The advance approval of the Audit Committee or members thereof, to whom approval authority has been delegated, is required for all audit and non-audit services (other than “prohibited non-audit services” as defined in the SEC rules) to be provided to the Company by our independent external auditor. All services provided by our independent external auditor are approved in advance by either the Audit Committee or members thereof, to whom authority has been delegated, in accordance with the Audit Committee Charter.

ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES

Not applicable.

ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS

Not applicable.

ITEM 16F. CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT

Not applicable.

ITEM 16G. CORPORATE GOVERNANCE

The rights and obligations of the Telesat Corporation shareholders are set out in the Telesat Corporation Articles. The governance of Telesat Corporation is subject to the terms of the BCBCA and separate Investor Rights Agreements entered into between Telesat Corporation and each of MHR and PSP Investments.

For a description of the composition of the Telesat Corporation Board and a summary of the rights, duties and obligations of its members, as provided in the Telesat Corporation Articles, see Item 6.A Directors and Senior Management and Item 6.C Board Practices.

Telesat recognizes that good corporate governance plays an important role in its overall success and in enhancing shareholder value and, accordingly, Telesat Corporation has adopted certain corporate governance policies and practices.

The Canadian Securities Administrators have issued corporate governance guidelines pursuant to National Policy 58-201 — Corporate Governance Guidelines (the “Corporate Governance Guidelines”), together with certain related disclosure requirements pursuant to National Instrument 58-101 — Disclosure of Corporate Governance Practices (“NI 58-101”). The Corporate Governance Guidelines are recommended as “best practices” for reporting issuers to follow. The aforementioned corporate governance policies and practices adopted or to be adopted by Telesat Corporation reflects consideration of these recommended Corporate Governance Guidelines and are subject to the rights of MHR and PSP Investments under the Telesat Corporation Articles and Investor Rights Agreements.

In addition, pursuant to Rule 5615(b) of NASDAQ’s Listed Company Manual (the “NASDAQ Marketplace Rules”), Telesat Corporation, as a Foreign Private Issuer (as defined under U.S. securities laws), has the option to comply with practices that are permitted under Canadian law in lieu of certain provisions of the NASDAQ Marketplace Rules. Notwithstanding the preceding sentence, Telesat Corporation intends to comply with the rules generally applicable to U.S. domestic companies listed on the NASDAQ. Telesat Corporation may in the future decide to use other Foreign Private Issuer exemptions with respect to some of the other NASDAQ listing requirements. Following the home country governance practices of Telesat Corporation, as opposed to the requirements that would otherwise apply to a company listed on the NASDAQ, may provide less protection than is accorded to investors under the NASDAQ listing requirements applicable to U.S. domestic issuers.

ITEM 16H. MINE SAFETY DISCLOSURE

Not applicable.

ITEM 16I. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS.

Not applicable.

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ITEM 16J. INSIDER TRADING POLICIES

Telesat has adopted an insider trading policy governing the purchase, sale, and other dispositions of our securities by directors, officers, employees and other persons in a special relationship with Telesat. A copy of our insider trading policy is included as an exhibit to this Annual Report.

ITEM 16K. CYBERSECURITY

Cybersecurity Risk Management and Strategy

We recognize the importance of assessing, identifying, and managing material risks associated with cybersecurity threats, as such term is defined in Form 20-F, Part II, Item 16K(a). These risks include, among other things, operational risks; intellectual property theft; fraud; extortion; harm to employees or customers; violation of privacy or security laws and other litigation and legal risk; and reputational risks.

We also maintain an incident response plan to coordinate the activities we take to protect against, detect, respond to and remediate cybersecurity incidents, as such term is defined in Form 20-F, Part II, Item 16K(a), as well as to comply with potentially applicable legal obligations and mitigate brand and reputational damage.

We have implemented several cybersecurity processes, technologies, and controls to aid in our efforts to identify, assess, and manage material risks, as well as to test and improve our incident response plan. Our approach includes, among other things:

• conducting regular network and endpoint monitoring, as well as periodic vulnerability assessments and penetration testing, designed to identify threat risks on our information systems, as such term is defined in Form 20-F, Part II, Item 16K(a);

• running tabletop exercises to simulate a response to a cybersecurity incident and use the findings to improve our processes and technologies;

• conducting regular cybersecurity training programs for employees, including annual review and acceptance of our IT Acceptable Use Policy (IT-AUP), and the annual cybersecurity awareness month employee engagement activities designed to reinforce our employee information security training and enhance the culture and knowledge of cybersecurity risks among our employees;

• writing some of our policies, procedures and standards based on the standards set by the National Institute of Standards and Technology (“NIST”);

• leveraging the NIST incident handling framework to help us identify, protect, detect, respond, and recover when there is an actual or potential cybersecurity incident;

• operating threat intelligence processes designed to model and research our adversaries;

• conducting regular phishing email simulations for employees and contractors with access to corporate email systems to enhance awareness and responsiveness to such possible threats;

• through policy, practice and contract (as applicable) requiring employees, as well as third-parties who provide services on our behalf, to treat customer information and data with care; and

• performing cybersecurity risk assessments of key vendors.

These approaches vary in maturity across the business and we work to continually improve them.

Our process for identifying and assessing material risks from cybersecurity threats operates alongside our broader overall risk assessment process, covering all company risks. As part of this process appropriate disclosure personnel will collaborate with subject matter specialists, as necessary, to gather insights for identifying and assessing material cybersecurity threat risks, their severity, and potential mitigations.

As part of the above approach and processes, we regularly engage with auditors to help identify areas for continued focus, improvement and/or compliance.

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In our risk factors, we describe whether and how risks from identified cybersecurity threats, including as a result of any previous cybersecurity incidents, have materially affected or are reasonably likely to materially affect us, including our business strategy, results of operations, or financial condition. See our risk factor disclosures at Item 3D of this Annual Report on Form 20-F.

In the last three fiscal years, we have not experienced any material cybersecurity incidents and the expenses we have incurred from cybersecurity incidents were immaterial. This includes penalties and settlements of which there were none.

Cybersecurity Governance

Cybersecurity is an important part of our risk management processes and an area of increasing focus for the Telesat Corporation Board (the “Board”) and management.

As part of our entire Board’s operational risk management responsibilities, it provides oversight of risks from cybersecurity threats. The Audit Committee has been designated with the responsibility to regularly review the Company’s processes and procedures around managing cybersecurity threat risks and cybersecurity incidents. As discussed below, members of management report to the Audit Committee which reports to the entire Board about cybersecurity threat risks, among other cybersecurity related matters. At least quarterly the Audit Committee receives an overview from management of our cybersecurity threat risk management and strategy processes covering topics such as data security posture, results from third-party assessments, progress towards pre-determined risk-mitigation-related goals, our incident response plan, and cybersecurity threat risks or incidents and developments, as well as the steps management has taken to respond to such risks. In such sessions, the Audit Committee generally receives materials including a cybersecurity scorecard and other materials indicating current and emerging cybersecurity threat risks, and describing the company’s ability to mitigate those risks, and discusses such matters with our Chief Information Officer (“CIO”) and our Director of Cybersecurity and Compliance (“DCC”). The Audit Committee chair briefs the plenary Board on management’s assessment at each quarterly Board meeting. Management also provides a cyber security briefing directly to the plenary Board annually, or more frequently if circumstances warrant, along with delivery of the scorecard and any material developments, quarterly. Members of the Board are also encouraged to regularly engage in ad hoc conversations with management on cybersecurity-related news events and discuss any updates to our cybersecurity risk management and strategy programs. Material cybersecurity threat risks may also be considered during separate Board and committee meeting discussions.

Our cybersecurity risk management and strategy processes, which are discussed in greater detail above, are led by our CIO and our DCC. Such individuals have collectively over 25 years of prior work experience in various roles managing information security, developing cybersecurity strategy and implementing information and cybersecurity programs.

Our CIO has developed an expertise in enterprise and systems architecture, software engineering and development, database management, end-user computing, data center operations and service management, and has managed the cybersecurity organizations of public companies as Chief Information Officer for over 13 years, 7 of which involved dealing with classified or sensitive military data subject to the ITAR DFARS, NIST 800-171 and other similar information management controls and associated stringent cybersecurity requirements. He holds a Bachelor of Science and Master of Science degrees in Engineering from Laval University.

Our DCC oversees the cybersecurity risk management activities and reports directly to the CIO. Our DCC has over 12 years’ experience running a cybersecurity organization at Telesat and at a large, publicly-listed, US defense contractor. She is CISSP-certified, has a Master of Business Administration and holds a Bachelor of Science majoring in information technology from Western Governor’s University. She has built incident response plans and has experience with managing incidents and coordinating a response, remediating issues and implementing corrective actions to prevent further similar incidents. Her experience also includes reporting on the risk of incidents, advising executives in determining the overall impact, and recommending mitigation and containment measures.

These members of management are informed about and monitor the prevention, mitigation, detection, and remediation of cybersecurity incidents through their management of, and participation in, the cybersecurity risk management and strategy processes described above, including the operation of our incident response plan. If a cybersecurity incident is determined to be a material cybersecurity incident, our incident response plan and cybersecurity disclosure controls and procedures define the process to disclose such a material cybersecurity incident.

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PART III

ITEM 17. FINANCIAL STATEMENTS.

We have elected to provide financial statements pursuant to Item 18.

ITEM 18. FINANCIAL STATEMENTS.

The Annual Financial Statements of Telesat Corporation are included at the end of this Annual Report.

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ITEM 19. EXHIBITS

Exhibit No.	Description of Exhibit
1.1	Articles of Telesat Corporation, dated as of November 17, 2021 (incorporated by reference from Exhibit 99.2 to the Report of Foreign Private Issuer on Form 6-K (File No. 333-255518) filed by Telesat Corporation on November 19, 2021).
1.2	Amended and Restated Limited Partnership Agreement of Telesat Partnership LP, dated as of November 17, 2021, between Telesat Corporation, Henry Intven, Red Isle Private Investments Inc., Public Sector Pension Investment Board, John Cashman, Clare Copeland and each person who is admitted to Telesat Partnership LP as a limited partner in accordance with the terms thereto (incorporated by reference from Exhibit 99.3 to the Report of Foreign Private Issuer on Form 6-K (File No. 333-255518) filed by Telesat Corporation on November 19, 2021).
2.1	Trust Agreement, dated as of November 18, 2021, by and between Christopher DiFrancesco, TSX Trust Company and, solely for the purposes set forth therein, Telesat Corporation and Telesat Partnership LP (incorporated by reference from Exhibit 99.4 to the Report of Foreign Issuer on Form 6-K (File No. 333-255518) filed by Telesat Corporation on November 19, 2021).
2.2	Voting Agreement, dated as of November 18, 2021, by and between TSX Trust Company, Telesat Corporation and Telesat Partnership LP (incorporated by reference from Exhibit 99.5 to the Report of Foreign Private Issuer on Form 6-K (File No. 333-255518) filed by Telesat Corporation on November 19, 2021).
2.3	Indenture, dated October 11, 2019, with respect to Telesat Canada’s 6.500% Senior Notes due 2027, among Telesat Canada and Telesat LLC, as co-issuers, the guarantors party thereto and The Bank of New York Mellon, as Trustee (incorporated by reference from Exhibit 4.1 to the Report of Foreign Issuer on Form 6-K (File No. 333-159793-01) filed by Telesat Canada on October 11, 2019).
2.4	Indenture, dated December 6, 2019, with respect to Telesat Canada’s 4.875% Senior Secured Notes due 2027, among Telesat Canada and Telesat LLC, as co-issuers, the guarantors party thereto and The Bank of New York Mellon, as Trustee and as a Notes Collateral Agent and the other Notes Collateral Agents party thereto (incorporated by reference from Exhibit 4.1 to the Report of Foreign Issuer on Form 6-K (File No. 333-159793-01) filed by Telesat Canada on December 11, 2019).
2.5	Indenture, dated April 27, 2021, with respect to Telesat Canada’s 5.625% Senior Secured Notes due 2026, among Telesat Canada and Telesat LLC, as co-issuers, the guarantors party thereto and The Bank of New York Mellon, as Trustee and as a Notes Collateral Agent and the other Notes Collateral Agents party thereto (incorporated by reference from Exhibit 4.1 to the Report of Foreign Issuer on Form 6-K (File No. 333-159793-01) filed by Telesat Canada on April 27, 2021).
2.6	Description of Rights of each Class of Securities Registered under Section 12 of the Securities Exchange Act of 1934 (incorporated by reference from Exhibit 2.6 to the Annual Report on Form 20-F (File No. 001-41083) filed by Telesat Corporation on March 18, 2022).
4.1**	Transaction Agreement and Plan of Merger, dated as of November 23, 2020, by and among Telesat Canada, Telesat Corporation, Telesat Partnership LP, Telesat CanHold Corporation, Lion Combination Sub Corporation, Loral Space & Communications Inc., Public Sector Pension Investment Board and Red Isle Private Investments Inc. (incorporated by reference from Exhibit 2.1 to Loral’s Current Report on Form 8-K (File No. 1-14180), filed on November 25, 2020).
4.2	Investor Rights Agreement, dated as of November 23, 2020, by and between Telesat Corporation and MHR Fund Management LLC (incorporated by reference from Annex I to the proxy statement/prospectus that is part of the registration statement on Form F-4 (File No. 333-255518) filed by Telesat Corporation and Telesat Partnership LP on April 26, 2021).
4.3	Investor Rights Agreement, dated as of November 23, 2020, by and between Telesat Corporation and Public Sector Pension Investment Board (incorporated by reference from Annex J to the proxy statement/prospectus that is part of the registration statement on Form F-4 (File No. 333-255518) filed by Telesat Corporation and Telesat Partnership LP on April 26, 2021).
4.4	Registration Rights Agreement, dated as of November 23, 2020, by and among Telesat Corporation, Public Sector Pension Investment Board, Red Isle Private Investments Inc. and MHR Fund Management LLC and certain of its affiliates (incorporated by reference from Annex K to the proxy statement/prospectus that is part of the registration statement on Form F-4 (File No. 333-255518) filed by Telesat Corporation and Telesat Partnership LP on April 26, 2021).

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Exhibit No.	Description of Exhibit
4.5	Credit Agreement, dated as of March 28, 2012, by and among Telesat Holdings Inc., Telesat Canada, Telesat LLC, the guarantors party thereto, JP Morgan Chase Bank, N.A., as administrative agent, and the other lenders party thereto (incorporated by reference from Exhibit 4.1 to the Report of Foreign Issuer on Form 6-K (File No. 333-159793) filed by Telesat Canada on March 29, 2012).
4.6	Amendment No. 1, dated as of April 2, 2013, to the Credit Agreement, dated as of March 28, 2012, by and among Telesat Holdings Inc., Telesat Canada, Telesat LLC, the guarantors party thereto, JP Morgan Chase Bank, N.A., as administrative agent, and the other lenders party thereto (incorporated by reference from Exhibit 4.1 to the Report of Foreign Issuer on Form 6-K (File No. 333-159793-01) filed by Telesat Holdings Inc. on April 2, 2013).
4.7	Amendment No. 2, dated as of November 17, 2016, to the Credit Agreement, dated as of March 28, 2012, as amended by Amendment No. 1 on April 2, 2013, by and among Telesat Holdings Inc., Telesat Canada, Telesat LLC, the guarantors party thereto, the lenders party thereto, and JP Morgan Chase Bank, N.A., as administrative agent, collateral agent, swingline lender and L/C Issuer (incorporated by reference from the Report of Foreign Issuer on Form 6-K (File No. 333-159793-01) filed by Telesat Holdings Inc. on November 17, 2016).
4.8	Amendment No. 3 dated December 19, 2016 to the Credit Agreement, dated as of March 28, 2012, as amended by Amendment No. 1 on April 2, 2013, as further amended by Amendment No. 2 on November 17, 2016, by and among Telesat Canada, Telesat LLC, the guarantors party thereto, the lenders party thereto and JP Morgan Chase Bank, N.A., as administrative agent, collateral agent, swingline lender and L/C Issuer (incorporated by reference from Exhibit 4.1 to the Report of Foreign Issuer on Form 6-K (File No. 333-159793-01) filed by Telesat Canada on February 2, 2017).
4.9	Amendment No. 4 dated February 1, 2017 to the Credit Agreement, dated as of March 28, 2012, as amended by Amendment No. 1 on April 2, 2013, as further amended by Amendment No. 2 on November 17, 2016, and as further amended by Amendment No. 3 on December 19, 2016, by and among Telesat Canada, Telesat LLC, the guarantors party thereto, the lenders party thereto and JP Morgan Chase Bank, N.A., as administrative agent, collateral agent, swingline lender and L/C Issuer (incorporated by reference from Exhibit 4.2 to the Report of Foreign Issuer on Form 6-K (File No. 333-159793-01) filed by Telesat Canada on February 2, 2017).
4.10	Amendment No. 5 dated April 26, 2018 to the Credit Agreement, dated as of March 28, 2012, as amended by Amendment No. 1 on April 2, 2013, as further amended by Amendment No. 2 on November 17, 2016, as further amended by Amendment No. 3 on December 19, 2016 and as further amended by Amendment No. 4 on February 1, 2017, by and among Telesat Canada, Telesat LLC, the guarantors party thereto, the lenders party thereto and JP Morgan Chase Bank, N.A., as administrative agent, collateral agent, swingline lender and L/C Issuer and the other financial institutions and other parties party thereto (incorporated by reference from Exhibit 4.1 to the Report of Foreign Issuer on Form 6-K (File No. 333-159793-01) filed by Telesat Canada on April 26, 2018).
4.11	Amendment No. 6, dated December 6, 2019, to the Credit Agreement, dated March 28, 2012, as amended by Amendment No. 1 on April 2, 2013, as further amended by Amendment No. 2 on November 17, 2016, as further amended by Amendment No. 3 on December 19, 2016, as further amended by Amendment No. 4 on February 1, 2017 and as further amended by Amendment No. 5 on April 26, 2018, by and among Telesat Canada, Telesat LLC, the guarantors party thereto, the lenders party thereto and JP Morgan Chase Bank, N.A., as administrative agent, collateral agent, swingline lender and L/C Issuer and the other financial institutions and other parties party thereto (incorporated by reference from Exhibit 4.2 to the Report of Foreign Issuer on Form 6-K (File No. 333-159793-01) filed by Telesat Canada on December 11, 2019).
4.12*	Amendment No. 7, dated as of May 9, 2023, to the Credit Agreement, dated as of March 28, 2012, as amended by Amendment No. 1 on April 2, 2013, as further amended by Amendment No. 2 on November 17, 2016, as further amended by Amendment No. 3 on December 19, 2016, as further amended by Amendment No. 4 on February 1, 2017, as further amended by Amendment No. 5 on April 26, 2018 and as further amended by Amendment No. 6 on December 6, 2019, by and among Telesat Canada, Telesat LLC, the guarantors party thereto, the lenders party thereto and JP Morgan Chase Bank, N.A., as administrative agent, collateral agent, swingline lender and L/C Issuer and the other financial institutions and other parties party thereto.
4.13	Summary of Terms and Conditions for Proposed Investment in Telesat Lightspeed LEO Project (incorporated by reference from Exhibit 99.2 to the Report of Foreign Issuer on Form 6-K (File No. 333-159793-01) filed by Telesat Canada on August 12, 2021).

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Exhibit No.	Description of Exhibit
4.14	Telesat Corporation Amended & Restated Management Stock Incentive Plan (incorporated by reference from Exhibit 4.2 to the Registration Statement on Form S-8 (File No. 333-261257) filed by Telesat Corporation on November 22, 2021).
4.15	Telesat Corporation 2021 Amended & Restated Management Stock Incentive Plan (incorporated by reference from Exhibit 4.3 to the Registration Statement on Form S-8 (File No. 333-261257) filed by Telesat Corporation on November 22, 2021).
4.16	Telesat Corporation Restricted Share Unit Plan (incorporated by reference from Exhibit 4.4 to the Registration Statement on Form S-8 (File No. 333-261257) filed by Telesat Corporation on November 22, 2021).
4.17	Telesat Corporation Omnibus Long-Term Incentive Plan (incorporated by reference from Exhibit 4.5 to the Registration Statement on Form S-8 (File No. 333-261257) filed by Telesat Corporation on November 22, 2021).
4.18	Form of Indemnity Agreement by and among Telesat Corporation and Officers and Directors (incorporated by reference from Exhibit 4.17 to the Annual Report on Form 20-F (File No. 001-41083) filed by Telesat Corporation on March 18, 2022).
8.1*	List of subsidiaries of Telesat Corporation
11.1*	Insider Trading Policy
12.1*	Section 302 Certification of Chief Executive Officer of Telesat Corporation
12.2*	Section 302 Certification of Chief Financial Officer of Telesat Corporation
13.1*	Section 906 Certification of Chief Executive Officer of Telesat Corporation
13.2*	Section 906 Certification of Chief Financial Officer of Telesat Corporation
15.1*	Consent of Deloitte LLP
97.1*	Compensation Recovery Policy
101.INS	Inline XBRL Instance Document — the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH	Inline XBRL Taxonomy Extension Schema Document
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document
104	The cover page for the Company’s Annual Report on Form 20-F for the year ended December 31, 2023 has been formatted in Inline XBRL

____________

* Filed herewith.

** Certain exhibits and disclosure schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K. Telesat agrees to furnish supplementally to the SEC a copy of any omitted schedule upon request.

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SIGNATURES

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.

	Telesat Corporation
	By:	/s/ Daniel S. Goldberg
	Name:	Daniel S. Goldberg
Date: March 28, 2024	Title:	President and Chief Executive Officer

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Telesat CorporationIndex to Consolidated Financial Statements

	Page
Reports of Independent Registered Public Accounting Firm	F-2
Consolidated Statements of Income (Loss)	F-5
Consolidated Statements of Comprehensive Income (Loss)	F-6
Consolidated Statements of Changes in Shareholders’ Equity	F-7
Consolidated Balance Sheets	F-8
Consolidated Statements of Cash Flows	F-9
Notes to the 2023 Consolidated Financial Statements	F-10

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Report of Independent Registered Public Accounting Firm

To the shareholders and the Board of Directors of Telesat Corporation

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Telesat Corporation and subsidiaries (the “Company”) as of December 31, 2023 and 2022, the related consolidated statements of income (loss), comprehensive income (loss), changes in shareholders’ equity, and cash flows, for each of the three years in the period ended December 31, 2023, and the related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and its financial performance and its cash flows for each of the three years in the period ended December 31, 2023, in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 27, 2024, expressed an unqualified opinion on the Company’s internal control over financial reporting.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Goodwill and orbital slots (indefinite life intangible assets) impairment — Refer to Notes 4, 5, 17 and 18 of the financial statements

Critical Audit Matter Description

The Company’s evaluation of goodwill and orbital slots for impairment involves the comparison of the recoverable amount of the Company for goodwill, and of the cash generating units for orbital slots, (the “recoverable amounts”) to their respective carrying values annually, or more frequently if indicators of impairment are identified. Recoverable amounts are defined as the higher of fair value less costs of disposal and value in use, which are determined using an income approach based on a discounted cash flow and a market approach based on market multiples. In determining the recoverable amounts, management made significant estimates and assumptions related to future revenue forecasts,

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future expenses and capital expenditures, costs of disposal, discount rates and market multiples. In addition, the Company plans to introduce new satellites under a Low Earth Orbit constellation (known as “Telesat Lightspeed”) which significantly impacts the estimated cash flows used in determining the recoverable amount of the Company.

The Company performed its annual impairment tests for goodwill and orbital slots in the fourth quarter of 2023. Based on the results of the annual impairment tests, the recoverable amounts exceeded their carrying values and no impairment to goodwill or orbital slots was recorded. Subsequent to the annual impairment tests, the Company identified indicators of impairment related to orbital slots and performed additional impairment tests as of December 31, 2023. The carrying value of orbital slots exceeded its recoverable amount and the Company recorded an impairment loss.

While there are several estimates and assumptions that are required to determine the recoverable amounts, the estimates with the highest degree of subjectivity are future cash flows (future revenue forecasts and future capital expenditures), discount rates and market multiples (“key assumptions”). This required significant auditor attention as the key assumptions are subject to a high degree of judgment and there is limited historical data available for Telesat Lightspeed which resulted in an increased extent of audit effort, including the involvement of fair value specialists.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the key assumptions used to determine the recoverable amounts for each impairment test included the following, among others:

• Evaluated the effectiveness of the internal controls over the assessments of goodwill and orbital slots for impairment, including those over the key assumptions;

• Evaluated management’s ability to accurately forecast future cash flows by comparing actual results to historical forecasts;

• Evaluated the reasonableness of the future cash flows for:

• Revenue forecast by comparing it to historical revenue, contracted revenue including backlogs of existing service contracts, results of the ongoing discussions with customers, due diligence reports, industry reports in respect of demand for satellite capacity and pricing, and communications to the board of directors and external stakeholders;

• Future capital expenditures by comparing it to signed contracts, an independently developed estimate for future costs based on signed contracts, due diligence reports, industry reports, and communications to the board of directors and external stakeholders;

• With the assistance of fair value specialists:

• Evaluated the reasonableness of the discount rates by testing the source information underlying the determination of the discount rates and developing a range of independent estimates and comparing to those selected by management;

• Evaluated the market multiples by analyzing precedent market transactions and comparable public company multiples and developing a range of independent market multiples and comparing to those selected by management.

/s/ Deloitte LLP

Chartered Professional Accountants

Licensed Public Accountants

Toronto, Canada

March 27, 2024

We have served as the Company’s auditor since 1993.

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Report of Independent Registered Public Accounting Firm

To the shareholders and the Board of Directors of Telesat Corporation

Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of Telesat Corporation and subsidiaries (the “Company”) as of December 31, 2023, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, 2023, of the Company and our report dated March 27, 2024, expressed an unqualified opinion on those financial statements.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company’s in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Deloitte LLP

Chartered Professional Accountants

Licensed Public Accountants

Toronto, Canada

March 27, 2024

We have served as the Company’s auditor since 1993.

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Telesat CorporationConsolidated Statements of Income (Loss)

		For the years ended December 31,
(in thousands of Canadian dollars, except per share amounts)	Notes	2023			2022			2021
					(Note 3)			(Note 3)
Revenue	6	$	704,161		$	759,169		$	758,212
Operating expenses	7		(204,552	)		(258,989	)		(236,949	)
Depreciation			(182,669	)		(188,755	)		(203,772	)
Amortization			(13,093	)		(14,979	)		(15,983	)
Other operating gains (losses), net	8		264,999			7			107,615
Operating income			568,846			296,453			409,123
Interest expense	9		(270,350	)		(221,756	)		(187,994	)
Gain on repurchase of debt	24		230,080			106,916			—
Interest and other income			66,532			23,476			3,418
Gain (loss) on changes in fair value of financial instruments			—			4,314			(18,684	)
Gain (loss) on foreign exchange			77,758			(239,591	)		27,539
Income (loss) before income taxes			672,866			(30,188	)		233,402
Tax (expense) recovery	10		(89,596	)		(51,409	)		(71,035	)
Net income (loss)		$	583,270		$	(81,597	)	$	162,367
Net income (loss) attributable to:
Telesat Corporation shareholders		$	157,118		$	(23,764	)	$	92,532
Non-controlling interest			426,152			(57,833	)		69,835
		$	583,270		$	(81,597	)	$	162,367
Net income (loss) per common share attributable to Telesat Corporation shareholders
Basic		$	11.71		$	(1.93	)	$	2.05
Diluted		$	11.29		$	(1.93	)	$	1.99
Total Weighted Average Common Shares Outstanding
Basic	27		13,417,290			12,311,264			45,168,650
Diluted	27		15,288,221			12,311,264			46,620,495

See accompanying notes to the consolidated financial statements

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Telesat CorporationConsolidated Statements of Comprehensive Income (Loss)

		For the years ended December 31,
(in thousands of Canadian dollars)	Notes	2023			2022			2021
					(Note 3)			(Note 3)
Net income (loss)		$	583,270		$	(81,597	)	$	162,367
Other comprehensive income (loss)
Items that may be reclassified into profit or loss
Foreign currency translation adjustments			(50,985	)		148,456			(17,555	)
Items that will not be reclassified to profit or loss
Actuarial gain (loss) on defined benefit plans	32		(5,050	)		33,282			55,422
Income tax on items that will not be reclassified to profit or loss			1,665			(6,768	)		(14,424	)
Total other comprehensive income (loss)			(54,370	)		174,970			23,443
Total comprehensive income (loss)		$	528,900		$	93,373		$	185,810
Total comprehensive income (loss) attributable to:
Telesat Corporation shareholders		$	142,787		$	19,889		$	90,405
Non-controlling interest			386,113			73,484			95,405
		$	528,900		$	93,373		$	185,810

See accompanying notes to the consolidated financial statements

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Telesat CorporationConsolidated Statements of Changes in Shareholders’ Equity

(in thousands of Canadian dollars)	Common<br>shares/Public<br>shares		Preferred<br>shares			Total<br>share<br>capital			Accumulated<br>earnings			Equity-settled<br>employee<br>benefits<br>reserve			Foreign<br>currency<br>translation<br>reserve			Total<br>reserves			Total<br>Telesat<br>Corporation<br>shareholders’<br>equity			Non-controlling<br>Interest			Total<br>shareholders’<br>equity
Balance as at January 1, 2021	$	26,580	$	129,118		$	155,698		$	1,264,344		$	85,648		$	(47,924	)	$	37,724		$	1,457,766		$	—		$	1,457,766
Net income (loss)		—		—			—			92,532			—			—			—			92,532			69,835			162,367
Dividends declared on Director Voting Preferred shares		—		—			—			(10	)		—			—			—			(10	)		—			(10	)
Issuance of share capital on settlement of restricted share units		—		16			16			—			—			—			—			16			—			16
Other comprehensive income (loss), net of tax (expense) recovery of (14,424)		—		—			—			9,946			—			(12,073	)		(12,073	)		(2,127	)		25,570			23,443
Share-based compensation		—		—			—			—			65,134			—			65,134			65,134			8,590			73,724
Reallocation related to transaction		16,261		(129,134	)		(112,873	)		(1,015,344	)		(112,118	)		44,137			(67,981	)		(1,196,198	)		1,181,115			(15,083	)
Balance as at December 31, 2021	$	42,841	$	—		$	42,841		$	351,468		$	38,664		$	(15,860	)	$	22,804		$	417,113		$	1,285,110		$	1,702,223
Balance as at January 1, 2022	$	42,841	$	—		$	42,841		$	351,468		$	38,664		$	(15,860	)	$	22,804		$	417,113		$	1,285,110		$	1,702,223
Net income (loss)		—		—			—			(23,764	)		—			—			—			(23,764	)		(57,833	)		(81,597	)
Issuance of share capital on settlement of restricted share units		2,142		—			2,142			—			(1,224	)		—			(1,224	)		918			(2,991	)		(2,073	)
Exchange of Limited Partnership units for Public Shares		1,571		—			1,571			21,812			(14	)		(183	)		(197	)		23,186			(23,186	)		—
Other comprehensive income (loss), net of tax (expense) recovery of (6,768)		—		—			—			6,757			—			36,896			36,896			43,653			131,317			174,970
Final Transaction adjustment		—		—			—			—			—			—			—			—			(20,790	)		(20,790	)
Share-based compensation		—		—			—			—			20,330			—			20,330			20,330			47,089			67,419
Balance as at December 31, 2022	$	46,554	$	—		$	46,554		$	356,273		$	57,756		$	20,853		$	78,609		$	481,436		$	1,358,716		$	1,840,152
Balance as at January 1, 2023	$	46,554	$	—		$	46,554		$	356,273		$	57,756		$	20,853		$	78,609		$	481,436		$	1,358,716		$	1,840,152
Net income (loss)		—		—			—			157,118			—			—			—			157,118			426,152			583,270
Issuance of share capital on settlement of restricted share units		3,212		—			3,212			11			(661	)		—			(661	)		2,562			(5,693	)		(3,131	)
Issuance of share capital on exercise of stock options		29		—			29			—			—			—			—			29			(13	)		16
Exchange of Limited Partnership units for Public Shares		1,457		—			1,457			21,577			2,375			1,358			3,733			26,767			(26,767	)		—
Other comprehensive income (loss), net of tax (expense) recovery of 1,665		—		—			—			(921	)		—			(13,410	)		(13,410	)		(14,331	)		(40,039	)		(54,370	)
Share-based compensation		—		—			—			—			8,337			—			8,337			8,337			24,709			33,046
Balance as at December 31, 2023	$	51,252	$	—		$	51,252		$	534,058		$	67,807		$	8,801		$	76,608		$	661,918		$	1,737,065		$	2,398,983

All values are in US Dollars.

See accompanying notes to the consolidated financial statements

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Telesat CorporationConsolidated Balance Sheets

(in thousands of Canadian dollars)	Notes	December 31,<br>2023		December 31,<br>2022
				(Note 3)
Assets
Cash and cash equivalents		$	1,669,089	$	1,677,792
Trade and other receivables	11		78,289		41,248
Other current financial assets	12		631		515
Current income tax recoverable			16,510		18,409
Prepaid expenses and other current assets	13		52,169		50,324
Total current assets			1,816,688		1,788,288
Satellites, property and other equipment	6,16		1,260,298		1,364,084
Deferred tax assets	10		2,954		49,984
Other long-term financial assets	14		6,633		10,476
Long-term income tax recoverable			7,497		15,303
Other long-term assets	6,15		40,926		47,977
Intangible assets	6,17		692,756		756,878
Goodwill	18		2,446,603		2,446,603
Total assets		$	6,274,355	$	6,479,593
LIABILITIES
Trade and other payables	19	$	43,626	$	43,555
Other current financial liabilities	20		29,061		48,397
Income taxes payable			1,921		3,476
Other current liabilities	21		63,119		75,968
Total current liabilities			137,727		171,396
Long-term indebtedness	24		3,197,019		3,850,081
Deferred tax liabilities	10		235,247		271,246
Other long-term financial liabilities	22		14,938		19,663
Other long-term liabilities	23		290,441		327,055
Total liabilities			3,875,372		4,639,441
SHAREHOLDERS’ EQUITY
Share capital	25		51,252		46,554
Accumulated earnings			534,058		356,273
Reserves			76,608		78,609
Total Telesat Corporation shareholders’ equity			661,918		481,436
Non-controlling interest	26		1,737,065		1,358,716
Total shareholders’ equity			2,398,983		1,840,152
Total liabilities and shareholders’ equity		$	6,274,355	$	6,479,593

See accompanying notes to the consolidated financial statements

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Table of Contents

Telesat CorporationConsolidated Statements of Cash Flows

		For the years ended December 31,
(in thousands of Canadian dollars)	Notes	2023			2022			2021
					(Note 3)			(Note 3)
Cash flows from operating activities
Net income (loss)		$	583,270		$	(81,597	)	$	162,367
Adjustments to reconcile net income (loss) to cash flows from operating activities:
Depreciation			182,669			188,755			203,772
Amortization			13,093			14,979			15,983
Tax expense (recovery)			89,596			51,409			71,035
Interest expense			270,350			221,756			187,994
Interest income			(63,838	)		(23,564	)		(4,392	)
(Gain) loss on foreign exchange			(77,758	)		239,591			(27,539	)
(Gain) loss on changes in fair value of financial instruments			—			(4,314	)		18,684
Share-based compensation	31		33,015			67,428			73,723
(Gain) loss on disposal of assets	8		(59	)		(7	)		848
Gain on repurchase of debt			(230,080	)		(106,916	)		—
Impairment	8		79,740			—			—
Deferred revenue amortization			(59,337	)		(77,075	)		(64,998	)
Pension expense	32		5,674			7,587			8,133
C-band clearing income	8		(344,892	)		—			(42,860	)
Other			2,958			(1,184	)		(1,953	)
Income taxes paid, net of income tax received	33		(66,841	)		(98,143	)		(94,242	)
Interest paid, net of interest received	33		(209,261	)		(163,113	)		(154,433	)
Operating assets and liabilities	33		(39,212	)		(6,744	)		(58,625	)
Net cash from operating activities			169,087			228,848			293,497
Cash flows (used in) generated from investing activities
Cash payments related to satellite programs			(83,319	)		(31,805	)		(279,941	)
Cash payments related to property and other equipment			(42,920	)		(32,701	)		(31,725	)
Purchase of intangible assets			(13,267	)		(71	)		(1,162	)
C-band clearing proceeds	8		351,438			64,651			42,860
Net cash (used in) generated from investing activities			211,932			74			(269,968	)
Cash flows (used in) generated from financing activities
Proceeds from indebtedness	33		—			—			619,900
Payment of debt issue costs	33		—			—			(6,834	)
Repurchase of indebtedness	33		(344,014	)		(97,234	)		—
Payments of principal on lease liabilities	33		(2,171	)		(2,498	)		(2,178	)
Satellite performance incentive payments	33		(6,385	)		(6,667	)		(6,914	)
Tax withholdings on settlement of restricted share units			(3,198	)		—			—
Proceeds from exercise of stock options			27			—			16
Government grant received			1,089			22,324			—
Initial costs from transaction			—			—			1,260
Final Transaction adjustment payment	26		—			(20,790	)		—
Dividends on Director Voting Preferred shares	25		—			—			(10	)
Net cash (used in) generated from financing activities			(354,652	)		(104,865	)		605,240
Effect of changes in exchange rates on cash and cash equivalents			(35,070	)		104,142			2,446
Changes in cash and cash equivalents			(8,703	)		228,199			631,215
Cash and cash equivalents, beginning of year			1,677,792			1,449,593			818,378
Cash and cash equivalents, end of year		$	1,669,089		$	1,677,792		$	1,449,593

See accompanying notes to the consolidated financial statements

F-9

Table of Contents

Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

1. BACKGROUND OF THE COMPANY

Telesat Corporation (the “Corporation” or “Company”) was incorporated under the Business Corporations Act (British Columbia) in October 2020 and is headquartered in Ottawa, Canada.

The Corporation is a global satellite operator, providing mission-critical communications solutions to support the requirements of sophisticated satellite users throughout the world. The Company’s state-of-the-art fleet consists of 15 geostationary satellites and the Canadian payload on Viasat-1.

The Corporation is developing a constellation of low earth orbit (“LEO”) satellites and integrated terrestrial infrastructure, called “Telesat Lightspeed”. In January 2018, the first LEO satellite, LEO 1, was successfully launched into orbit. The LEO 1 satellite has demonstrated certain key features of the Telesat Lightspeed system design, specifically the capability of the satellite and customer terminals to deliver a low latency broadband experience. In July 2023, the Corporation successfully launched its LEO 3 satellite into orbit.

The Corporation began trading on the Nasdaq Global Select Market and the Toronto Stock Exchange on November 19, 2021 under the ticker symbol “TSAT”. This followed the closing of Telesat Canada’s transaction with Loral Space & Communications Inc. (“Loral”) and Public Sector Pension Investment Board (“PSP Investments”) (the “Transaction”), in which Loral’s stockholders and Telesat Canada’s other equity holders exchanged their interests for equity in the new public holding company.

The Transaction resulted in the Loral stockholders, PSP Investments and certain individual shareholders (other than the Voting Directors) of Telesat Canada owning indirectly through the Corporation and Telesat Partnership LP (the “Partnership”) approximately the same percentage of equity as they held in Telesat Canada; the Corporation becoming the publicly traded general partner of the Partnership; and the Partnership indirectly owning all of the economic interests in Telesat Canada and Loral becoming a wholly owned subsidiary of the Partnership.

For further details on the Transaction, refer to the Corporation’s Registration Statement on Form F-4 filed with the U.S. Securities Exchange Commission (“SEC”) on June 24, 2021, which can be obtained on the SEC’s website at https://www.sec.gov and the Non-Offering Prospectus filed with the Ontario Securities Commission (“OSC”) on November 16, 2021, which can be obtained on the website https://www.sedarplus.ca.

References herein to “Telesat” or “Company” refer to Telesat Corporation and its subsidiaries.

Unless the context states or requires otherwise, references herein to the “financial statements” or similar terms refer to the audited consolidated financial statements of Telesat.

On March 27, 2024, these financial statements were approved by the Audit Committee of the Board of Directors and authorized for issue.

2. BASIS OF PRESENTATION

Statement of Compliance

The consolidated financial statements were prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). The accounting policies in Note 4 were consistently applied to all years presented.

Basis of Consolidation

Subsidiaries

These consolidated financial statements include the results of the Telesat and subsidiaries controlled by the Company. Control is achieved when the Company has power over an entity, has exposure, or rights to variable returns from its involvement with an entity, and has the ability to use the power over an entity to affect the amount of its return. The most significant subsidiaries are listed in Note 35.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

BASIS OF PRESENTATION (cont.)

The portion of equity ownership in a subsidiary that is not directly or indirectly attributable to the Company is accounted for as non-controlling interest. Non-controlling interests in subsidiaries are identified separately from the Company’s equity therein. Those interests of non-controlling shareholders that are present ownership interests entitling their holders to a proportionate share of net assets upon liquidation may initially be measured at fair value or at the non-controlling interests’ proportionate share of the fair value of the acquiree’s identifiable net assets. The choice of measurement is made on an acquisition-by-acquisition basis. Other non-controlling interests are initially measured at fair value. Subsequent to acquisition, the carrying amount of non-controlling interests is the amount of those interests at initial recognition plus the non-controlling interests’ share of subsequent changes in equity.

Profit or loss and each component of other comprehensive income (loss) are attributed to the owners of the Company and to the non-controlling interests. Total comprehensive income (loss) of the subsidiaries is attributed to the owners of the Company and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

Joint arrangements

A joint operation is a type of joint arrangement whereby the parties that have joint control of the arrangement have rights to their share of the assets and revenue, and obligations for the liabilities and expenses, relating to the arrangement.

The Company’s consolidated financial statements include the Company’s share of the assets, liabilities, revenue and expenses of its interest in joint operations.

The consolidated financial statements have been prepared on an historical cost basis except for certain financial instruments which were measured at their fair values, as explained in the accounting policies below. Historical cost is based on the fair value of the consideration given or received in exchange for assets or liabilities.

3. CHANGE IN ACCOUNTING POLICY

Amendments to IAS 12, Income Taxes (“IAS 12”)

In May 2021, the IASB issued amendments to IAS 12.

The Company adopted the amendments effective for annual period beginning January 1, 2023. As a result of the amendment, the Company was required to recognize deferred tax on the prepayment options associated with the Senior Unsecured Notes, Senior Secured Notes and 2026 Senior Secured Notes.

An adjustment was recorded as a decrease to the opening balance of accumulated earnings as at January 1, 2021 in the amount of $1,412.

The cumulative impact on the balance sheet and statement of changes in shareholders’ equity was as follows:

As at December 31,	2022			2021
Deferred tax liabilities	$	(4,450	)
Accumulated earnings	$	1,071		$	1,439
Non-controlling interest	$	3,379		$	4,491

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Table of Contents

Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

CHANGE IN ACCOUNTING POLICY (cont.)

As a result of the amendment, there was also a change in the reallocation related to Transaction in the year ended December 31, 2021 in the statement of changes in shareholders’ equity.

The impact on the statements of income (loss) and the statements of comprehensive income (loss) was as follows:

For the years ended December 31,	2022			2021
Tax (expense) recovery	$	(1,480	)	$	7,342
Net income (loss) per common share attributable to Telesat Corporation shareholders – Basic	$	(0.03	)	$	0.16
Net income (loss) per common share attributable to Telesat Corporation shareholders – Diluted	$	(0.03	)	$	0.16

4. MATERIAL ACCOUNTING POLICY INFORMATION

Segment Reporting

The Company operates in a single operating segment, in which it provides satellite-based services to its broadcast, enterprise and consulting customers around the world. Operating segments are reported in a manner consistent with the internal reporting provided to the Company’s Chief Operating Decision Maker, who is the Company’s Chief Executive Officer. To be reported, a segment is usually based on quantitative thresholds but can also encompass qualitative factors management deems significant.

Foreign Currency Translation

Unless otherwise specified, all figures reported in the consolidated financial statements and associated note disclosures are presented in Canadian dollars, which is the functional and presentation currency of the Company. Each of the subsidiaries of the Company determines its own functional currency and uses that currency to measure items on their separate financial statements.

For the Company’s non-foreign operations, foreign currency non-monetary assets and liabilities are translated at their historical exchange rates, foreign currency monetary assets and liabilities are translated at the year-end exchange rates, and foreign denominated revenue and expenses are translated at the average exchange rates of the month in which the transactions occurred. Gains or losses on translation of these items are recognized as a component of net income (loss).

Upon consolidation of the Company’s foreign operations that have a functional currency other than the Canadian dollar, assets and liabilities are translated at the year-end exchange rate, and revenue and expenses are translated at the average exchange rates of the month in which the transactions occurred. Gains or losses on the translation of foreign subsidiaries are recognized in other comprehensive income (loss).

Cash and Cash Equivalents

All highly liquid investments with an original maturity of three months or less, or which are available upon demand with no penalty for early redemption, are classified as cash and cash equivalents. Cash and cash equivalents are comprised of cash on hand, demand deposits, short-term investments and restricted cash expected to be used within the next twelve months.

Revenue Recognition

Telesat recognizes revenue from satellite services on a monthly basis as services are performed in an amount that reflects the consideration the Company expects to receive in exchange for those services. Telesat accounts for a contract when it has approval and commitment from both parties, the rights of the parties are identified, payment terms are identified, the contract has commercial substance and collectability is considered probable.

F-12

Table of Contents

Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

MATERIAL ACCOUNTING POLICY INFORMATION (cont.)

Revenue from a contract to sell consulting services is recognized as follows:

• Consulting revenue for cost plus contracts is recognized as the approved time and labor is completed by Telesat.

• Fixed price consulting revenue contracts use an input method to determine the progress towards complete satisfaction of the performance obligation. The input method is measured by comparing actual costs incurred to total cost expected.

Equipment sale revenue is recognized when the customer obtains control of the equipment, being at the time the equipment is delivered to and accepted by the customer. Only equipment sales are subject to warranty or return and there is no general right of return. Historically, the Company has not incurred significant expenses for warranties.

When a transaction involves more than one product or service, revenue is allocated to each performance obligation based on its relative stand-alone selling price. Transactions are evaluated to determine whether the Company is the principal and if the transactions should be recorded on a gross or net basis.

Deferred Revenue

Deferred revenue represents the Company’s liability for the provision of future services and is classified on the balance sheet in other current and long-term liabilities. Deferred revenue consists of remuneration received in advance of the provision of service and in the majority of cases is recognized in income on a straight-line basis over the term of the related customer contracts. In the case of certain deferred revenue for short-term services, balances are recognized into income upon the completion or using an input method to determine the progress towards complete satisfaction of the performance obligation of the related contract. Prepayments are evaluated to determine whether or not they constitute a significant financing component. The Company has elected a practical expedient whereby if the timing difference between the customer prepayment and the transfer of control of the promised goods and services is less than a year then it would not be considered as a significant financing component.

A significant financing component will only occur in the following circumstances:

• There is a timing difference between when the control of goods or services is transferred to the customer and when the customer pays for the goods;

• The timing difference between the customer prepayment and transfer of control of the promised goods and services is in excess of one year; and

• The primary reason for the prepayment is for financing purposes.

In the case of the existence of a significant financing component, the amount of the consideration is adjusted to reflect what the cash selling price of the promised service would have been if payments had occurred as control of the service was transferred to the customer. The discount rate used in determining the significant financing component is the rate that would be reflected in a separate financing transaction between the Company and the customer at contract inception.

Inventories

Inventories are valued at the lower of cost and net realizable value and consist of finished goods and work in process. Cost for substantially all network equipment inventories are determined on a weighted average cost basis. Cost for work in process and certain one-of-a-kind finished goods are determined using the specific identification method.

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Table of Contents

Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

MATERIAL ACCOUNTING POLICY INFORMATION (cont.)

Borrowing Costs

Borrowing costs are incurred on the Company’s debt financing. Borrowing costs attributable to the acquisition, production or construction of a qualifying asset are added to the cost of that asset. The Company has defined a qualifying asset as an asset that takes longer than twelve months to be ready for its intended use or sale. Capitalization of borrowing costs continues until such time that the asset is substantially ready for its intended use or sale. Borrowing costs are determined based on specific financing related to the asset, or in the absence of specific financing, the borrowing costs are calculated on the basis of a capitalization rate which is equal to the Company’s weighted average cost of debt. All other borrowing costs are expensed when incurred.

Leases

At the inception of a contract, the Company assesses whether a contract is, or contains, a lease based on whether or not the contract conveys the right to control the use of the asset for a period of time in exchange for consideration.

The Company recognizes a right-of-use asset and lease liability at the lease commencement date. The right-of-use asset is initially measured based on the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, less any lease incentives received. Each individual lease liability is initially measured at the present value of the lease payments over the respective lease term, discounted using the Company’s incremental borrowing rate for that lease.

The lease term is the non-cancellable period determined for each of the leases considering the option to extend when it is reasonably certain that the Company will exercise the option or the option to terminate if it is reasonably certain that the Company will exercise the option.

After the commencement date, the right-of-use assets are measured applying the cost model and depreciated to the earlier of the end of the useful life of the asset or the end of the lease term on a straight-line basis. The lease liability is subsequently measured by increasing the carrying amount to reflect the interest on the lease, using the effective interest method, and by reducing the carrying amount to reflect the lease payments made.

The lease liability is remeasured when there is a change in future lease payments, arising from a change in index or rate, or if there is a change in the assessment of whether the Company will exercise a purchase, extension or termination option. The amount of the remeasurement of the lease liability is also recognized as an adjustment to the right-of-use asset, or is recorded in the statement of income (loss) if the carrying amount of the right-of-use asset has been reduced to zero.

The Company has elected to not recognize a right-of-use asset or lease liability for any lease that has a lease term of 12 months or less. The payments associated with these agreements would be recognized as an operating expense on a straight-line basis over the lease term.

The Company has also elected the practical expedient, for property leases, not to separate the non-lease components from the lease components, and instead account for each lease and any associated non-lease components within the contract as a single lease component.

Government Grants

Government grants are recognized where there is a reasonable assurance that the grant will be received and the attached conditions will be complied with.

When the grant relates to an expense, the grant is recorded as a deduction to the related expense incurred over the same period.

When the grant relates to an asset, the grant is deducted from the carrying amount of the related asset as the grant is receivable.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

MATERIAL ACCOUNTING POLICY INFORMATION (cont.)

Software as a Service arrangements

A Software as a Service (“SaaS”) cloud computing arrangement is evaluated as to whether it met the criteria under IAS 38, Intangible Assets (“IAS 38”) or IFRS 16, Leases. If an arrangement did not meet either of those criteria, the arrangement is accounted for as a service contract.

Telesat may enter into a SaaS cloud computing arrangement with a supplier where the contract conveys to Telesat a right to receive future access over the contract term to the supplier’s application software running on the supplier’s cloud infrastructure. The right to receive access does not provide Telesat with a software asset and, therefore, the access to the software is a service which is received over the contract term.

The assessment of whether configuration or customization of a software results in an intangible asset for Telesat depends on the nature and output of the configuration and customization performed. In some circumstances, the arrangement may result in additional code from which Telesat has the power to obtain the future economic benefits and to restrict others’ access to those benefits. In that case, in determining whether to recognize the additional code as an intangible asset, Telesat assesses whether the additional code is identifiable and meets the recognition criteria under IAS 38.

Separately acquired intangible rights (i.e. software licenses in cloud computing arrangements) are normally recognized as assets.

Satellites, Property and Other Equipment

Satellites, property and other equipment, which are carried at cost, less accumulated depreciation and any accumulated impairment losses, include the contractual cost of equipment, capitalized engineering costs, capitalized borrowing costs during the construction or production of qualifying assets, and with respect to satellites, the cost of launch services, and launch insurance.

Depreciation is calculated using the straight-line method over the respective estimated useful lives of the assets.

Below are the estimated useful lives in years of satellites, property & other equipment as at December 31, 2023.

	Years
Satellites	3 to 15
Right-of-use assets	2 to 27
Antennas, satellite control & communication equipment	5 to 20
Building, equipment & other	3 to 25

Construction in progress is not depreciated as depreciation only commences when the asset is ready for its intended use. For satellites, depreciation commences on the day the satellite becomes available for service.

The investment in each satellite is derecognized when the satellite is retired. When other property is retired from operations at the end of its useful life, the cost of the asset and accumulated depreciation are removed from the accounts. Earnings are credited with the amount of any net salvage value and charged with any net cost of removal. When an asset is sold prior to the end of its useful life, the gain or loss is recognized immediately in other operating gains (losses), net.

In the event of an unsuccessful launch or total in-orbit satellite failure, all unamortized costs that are not recoverable under launch or in-orbit insurance are recorded in other operating gains (losses), net.

Liabilities related to decommissioning and restoration of retiring property and other equipment are measured at fair value with a corresponding increase to the carrying amount of the related asset. The liability is accreted over the period of expected cash flows with a corresponding charge to interest expense. The liabilities recorded to date have not been significant and are reassessed at the end of each reporting period. There are no decommissioning or restoration obligations for satellites.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

MATERIAL ACCOUNTING POLICY INFORMATION (cont.)

Satellite Performance Incentive Payments

Satellite performance incentive payments are obligations payable to satellite manufacturers over the lives of certain satellites. The present value of the payments is capitalized as part of the cost of the satellite and recognized as part of the depreciation of the satellite.

Impairment of Long-Lived Assets

Tangible fixed assets and finite life intangible assets are assessed for impairment on an annual basis or more frequently when events or changes in circumstances indicate that the carrying value of an asset exceeds the recoverable amount. Tangible fixed assets and finite life intangible assets are also assessed for indicators of impairment or impairment reversals at each reporting period.

In cases where there are indicators of impairment, the recoverable amount of the asset, which is the higher of its fair value less costs of disposal and its value in use, is determined. If it is not possible to measure the recoverable amount for a particular asset, the Company determines the recoverable amount of the cash generating unit (“CGU”) with which it is associated. A CGU is the smallest identifiable group of assets that generates cash inflows which are largely independent of the cash inflows from other assets or groups of assets.

The Company measures value in use on the basis of the estimated future cash flows to be generated by an asset or CGU. These future cash flows are based on the Company’s latest business plan information and are discounted using rates that best reflect the time value of money and the specific risks associated with the underlying asset or assets in the CGU.

The fair value less costs of disposal is the price that would be received to sell an asset or CGU in an orderly transaction between market participants at the measurement date. For the impairment assessment, the fair value is calculated on a recurring basis and is calculated using Level 3 of the fair value hierarchy.

An impairment loss is the amount by which the carrying amount of an asset or CGU exceeds its recoverable amount. When an impairment loss subsequently reverses, the carrying amount of the asset (or a CGU) is increased to the revised measure of its recoverable amount, so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognized for the asset (or CGU) in prior years. Impairment losses and reversals of impairment losses are recognized in other operating gains (losses), net.

Goodwill and Intangible Assets

The Company accounts for business combinations using the acquisition method of accounting, which establishes specific criteria for the recognition of intangible assets separately from goodwill. Goodwill represents the excess between the total of the consideration transferred over the fair value of net assets acquired. After initial recognition at cost, goodwill is measured at cost less any accumulated impairment losses.

The Company distinguishes intangible assets between assets with finite and indefinite useful lives. Intangible assets with indefinite useful lives are comprised of the Company’s trade name, intellectual property, and orbital slots. These assets are carried at cost less any accumulated impairment losses. Finite life intangible assets, which are carried at cost less accumulated amortization and any accumulated impairment losses, consist of revenue backlog, customer relationships, customer contracts, concession rights, transponder rights, software and patents. Intangible assets with finite lives are amortized over their estimated useful lives using the straight-line method of amortization, except for revenue backlog which is based on the expected period of recognition of the related revenue.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

MATERIAL ACCOUNTING POLICY INFORMATION (cont.)

Below are the estimated useful lives in years of the finite life intangible assets as at December 31, 2023.

	Years
Revenue backlog	17
Customer relationships	20 to 21
Customer contracts	15
Concession rights	3 to 15
Transponder rights	16
Software	5
Patents	18

Impairment of Goodwill and Indefinite Life Intangible Assets

An assessment for impairment of goodwill and indefinite life intangible assets is performed annually, or more frequently whenever events or changes in circumstances indicate that the carrying amounts of these assets are likely to exceed their recoverable amount. Goodwill is tested for impairment at the entity level as this represents the lowest level within the Company at which the goodwill is monitored for internal management purposes, and is not larger than an operating segment. With the exception of trade name, which has not been allocated to any CGU and is tested for impairment at the asset level, indefinite life intangible assets are tested for impairment at the CGU level. In the case of orbital slots, the CGU is based on geography.

A quantitative impairment test consists of assessing the recoverable amount of an asset, which is the higher of its fair value less costs of disposal and its value in use. For the quantitative impairment assessment, fair value is calculated on a recurring basis and is calculated using Level 2 or Level 3 of the fair value hierarchy depending on the valuation approach being utilized.

Impairment losses are recognized in other operating gains (losses), net. For indefinite life intangible assets, reversals of impairment losses are also recognized in other operating gains (losses), net.

Orbital Slots

In performing the orbital slot impairment analysis, the Company determines, for each CGU, the recoverable amount. The recoverable amount is defined as the higher of the fair value less costs of disposal, and its value in use on an annual basis. To the extent that the recoverable amount is less than the carrying value of the asset, an impairment exists and the asset is written down to its recoverable amount.

Fair value less costs of disposal is the price that would be received to sell the CGU in an orderly transaction between market participants at the measurement date. In order to determine the fair value less costs of disposal, the Company uses either a market or income approach. Under a market approach, the Company measures what an independent third party would pay to purchase the orbital slots by looking to actual market transactions for similar assets. Under an income approach, the fair value is determined to be the sum of the projected discounted cash flows over a discrete period of time.

The value in use amount is the present value of the future cash flows expected to be derived from the CGU. The determination of this amount includes projections of cash inflows from the continuing use of the asset and cash outflows that are required to generate the associated cash inflows. These cash flows are discounted at an appropriate discount rate.

Goodwill

In performing the goodwill impairment analysis, the Company assesses the recoverable amount of goodwill. The recoverable amount is the higher of the income approach and the market approach.

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Table of Contents

Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

MATERIAL ACCOUNTING POLICY INFORMATION (cont.)

Under the income approach, the sum of the projected discounted cash flows for the next five years, or a longer period if justified by the most recent financial plan approved by management, in addition to a terminal value are used to determine the fair value at the entity level.

Under the market approach, the fair value at the entity level is determined based on market multiples derived from comparable public companies.

Under both approaches, all assumptions used are based on management’s best estimates. The discount rates are consistent with external sources of information.

Trade Name

For the purposes of impairment testing, the fair value of the trade name is determined using an income approach, specifically the relief from royalties method.

The relief from royalties method is comprised of two major steps:

i) a determination of the hypothetical royalty rate; and

ii) the subsequent application of the royalty rate to projected revenue.

In determining the hypothetical royalty rate in the relief from royalties method, the Company considered comparable license agreements, operating earnings benchmarks, an excess earnings analysis to determine aggregate intangible asset earnings, and other qualitative factors.

Intellectual Property

In performing the intellectual property impairment analysis, the Company determines its recoverable amount. The recoverable amount is the fair value less costs of disposal. To the extent that the recoverable amount is less than the carrying value of the asset, an impairment exists and the asset is written down to its recoverable amount.

The Company measures value in use on the basis of the estimated future cash flows to be generated by an asset. These future cash flows are based on the Company’s latest business plan information approved by senior management and are discounted using rates that best reflect the time value of money and the specific risks associated with the underlying asset.

Financial Instruments

Financial assets are initially recognized at fair value. Financial assets are measured using one of three measurement approaches (fair value through profit or loss (“FVTPL”), fair value through other comprehensive income (“FVTOCI”), or amortized cost). A financial asset is measured at amortized cost if it is not designated as FVTPL, it is held within a business model whose objective is to hold assets to collect contractual cash flows and its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. A debt investment is measured at FVTOCI if it is not designated at FVTPL, it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets and its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amounts outstanding. On initial recognition of an equity investment that is not held for trading, the Company may irrevocably elect to present subsequent changes in the investment’s fair value in OCI. This election is made on an investment by investment basis. All financial assets not classified as measured at amortized cost or FVTOCI as described above are measured at FVTPL. Telesat does not have any financial assets measured at FVTOCI as at December 31, 2023 and 2022.

The following accounting policies apply to the subsequent measurement of the Company’s financial assets:

• Amortized cost: The financial assets are subsequently measured at amortized cost in accordance with the effective interest method. The amortized cost is reduced by any impairment losses; and

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

MATERIAL ACCOUNTING POLICY INFORMATION (cont.)

• FVTPL: These financial assets are subsequently measured at fair value with changes in fair value recorded in the consolidated statement of income (loss) as part of gain (loss) on changes in fair value of financial instruments.

Financial liabilities are initially measured at fair value. Financial liabilities are classified as amortized cost or FVTPL. Financial liabilities that are classified as amortized cost are measured and recorded at amortized cost in accordance with the effective interest method. Financial liabilities classified as FVTPL are subsequently measured at fair value with changes in fair value recorded in the consolidated statement of income (loss) as part of the gain (loss) on changes in fair value of financial instruments.

The Company has used derivative financial instruments to manage its exposure to foreign exchange risk associated with debt denominated in foreign currencies, as well as to reduce its exposure to interest rate risk associated with debt. Currently, the Company does not designate any of its derivative financial instruments as hedging instruments for accounting purposes. All realized and unrealized gains and losses on these derivative financial instruments are recorded in the consolidated statement of income (loss) as part of gain (loss) on changes in fair value of financial instruments.

Derivatives, including embedded derivatives that must be separately accounted for, are recorded at fair value on the consolidated balance sheet at inception and marked to market at each reporting period thereafter. Derivatives embedded in financial liabilities and other non-financial instrument contracts are treated as separate derivatives when their risk and characteristics are not closely related to those of the host contract and the host contract is measured separately according to its characteristics. The Company accounts for embedded foreign currency derivatives and the related host contract as a single instrument where the contract requires payments denominated in the currency that is commonly used in contracts to procure non-financial items in the economic environment in which the Company transacts.

Transaction costs for instruments classified as FVTPL are expensed as incurred. Transaction costs that are directly attributable to the acquisition of financial assets and liabilities (other than FVTPL) are added or deducted from the fair value of the financial asset or financial liability on initial recognition.

The Company’s financial assets classified as amortized cost and contract assets are subject to impairment requirements. The Company has elected to measure loss allowances for trade receivables and other contract assets at an amount equal to lifetime expected credit loss. The lifetime expected credit losses are the expected credit losses that result from possible default events over the expected life of the instrument.

Financing Costs

The debt issuance costs related to the Senior Secured Credit Facility, the 6.5% Senior Unsecured Notes (“Senior Unsecured Notes”), the 4.875% Senior Secured Notes (“Senior Secured Notes”) and the 5.625% Senior Secured Notes (“2026 Senior Secured Notes”) are included in current and long-term indebtedness and are amortized to interest expense using the effective interest method. All other debt issuance costs are accounted for as short-term and long-term deferred charges and are included in prepaid expenses and other current assets and other long-term assets. The deferred charges are amortized to interest expense on a straight-line basis over the term of the indebtedness to which they relate.

Employee Benefit Plans

Telesat Canada maintains one contributory and three non-contributory defined benefit pension plans which provide benefits based on length of service and rate of pay. Two of these defined-benefit plans were closed to new members in 2013. Effective January 1, 2024, the Pension Plan for Employees of Telesat Canada and the Pension Plan for Designated Employees of Telesat Canada were merged into one plan, the Pension Plan for Employees of Telesat

F-19

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

MATERIAL ACCOUNTING POLICY INFORMATION (cont.)

Canada, subject to final regulatory filings and approvals. The combined plan is closed entirely to new members with respect to the defined benefit provisions. The merged plan offers a defined contribution pension to all employees of Telesat Canada and Telesat LEO Inc. effective January 1, 2024.

Telesat Canada also provides other post-employment and retirement benefits, including health care and life insurance benefits on retirement and various disability plans, worker’s compensation and medical benefits to former or inactive employees of Telesat Canada, their beneficiaries and covered dependents, after employment but before retirement, under certain circumstances.

In addition, Telesat Canada provides defined contribution pension plans, under certain circumstances, for employees who are not eligible for the defined benefit pension plans.

Telesat also provides health care and life insurance benefits for certain retired employees. These benefits are funded primarily on a pay-as-you-go basis, with the retiree paying a portion of the cost through contributions, deductibles and co-insurance provisions. Commencing in 2015, as a result of an amendment to one of the plans, Telesat has contributed to a health reimbursement account instead of providing the health care and life insurance benefits directly to certain retired employees.

As a result of the Transaction, the Company has become responsible for the defined benefit plan and health and life insurance benefits for retired employees of Loral. Loral maintained a defined benefit pension plan for its employees. Loral pension plan is a qualified defined benefit pension plan in which only the employees hired prior to July 1, 2006 could participate. Benefits are based primarily on members’ compensation and/or years of service. In addition to pension plan, certain health care and life insurance benefits are also provided to retired employees and dependents. Healthcare benefits end when the retiree reaches age 65.

The Company is responsible for adequately funding the defined benefit pension plans. Contributions are made based on actuarial cost methods that are permitted by pension regulatory bodies and reflect assumptions about future investment returns, salary projections and future service benefits.

Costs for defined contribution pension plans are recognized as an expense during the year in which the employees have rendered service entitling them to the Company’s contribution.

The Company accrues the present value of its obligations under employee benefit plans and the related costs reduced by the fair value of plan assets. Pension costs and other retirement benefits are determined using the projected unit credit method prorated on service and management’s best estimate of expected investment performance, salary escalation, retirement ages of employees and expected health care costs.

Pension plan assets are valued at fair value. The discount rate is based on the market interest rate of high quality bonds. Past service costs arising from plan amendments are recognized immediately to the extent that the benefits are already vested, and otherwise are amortized on a straight-line basis over the average remaining vesting period. A valuation is performed at least every three years to determine the present value of the accrued pension and other retirement benefits.

Remeasurements arising from defined benefit pension plans comprise actuarial gains and losses and the return on plan assets (excluding interest). The Company recognizes them immediately in other comprehensive income (loss), which is included in accumulated earnings, in the year in which they occur.

The current service costs and administration fees not related to asset management are included in operating expenses. The net interest expense (income) on the net defined benefit liability (asset) for the period is calculated by applying the discount rate used to measure the defined benefit obligation at the beginning of the year to the net defined benefit liability (asset) at the beginning of the year while considering any changes in the net defined benefit liability (asset) during the year as a result of contributions and benefit payments. The net interest expense (income) is included in interest expense.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

MATERIAL ACCOUNTING POLICY INFORMATION (cont.)

Share-Based Compensation Plans

The Company offers equity-settled share-based compensation plans for certain key employees under which it receives services from employees in exchange for equity instruments of the Company. The expense is based on the fair value of the awards granted using the Black-Scholes option pricing model. The expense is recognized over the vesting period, which is the period over which all of the specified vesting conditions are satisfied, with a corresponding increase in equity. For awards with graded vesting, the fair value of each tranche is recognized over the respective vesting period with a significant higher proportionate amount of the total expense being recognized earlier in the vesting period.

Restricted Share Units, Performance Share Units and Deferred Share Units

For each restricted share unit (“RSU”), performance share unit (“PSU”) or deferred share unit (“DSU”) an expense is recorded over the vesting period equal to the fair value of the Non-Voting Participating Preferred shares prior to the close of the Transaction and equal to the fair value of the either Class A Common shares or Class B Variable Voting shares of Telesat Corporation after the close of the Transaction, with a corresponding increase in equity. For awards with graded vesting, the fair value of each tranche is recognized over the respective vesting period with a significant higher proportionate amount of the total expense being recognized earlier in the vesting period. All RSU’s, PSU’s and DSU’s, including those issued prior to the close of the Transaction, are expected to be settled in either Class A Common shares or Class B Variable Voting shares of Telesat Corporation.

Income Taxes

Income tax expense, comprising current and deferred income tax, is recognized in income except to the extent it relates to items recognized in other comprehensive income (loss) or equity, in which case the income tax expense is recognized in other comprehensive income (loss) or equity, respectively.

Current income tax is measured at the amount expected to be paid to the taxation authorities, net of recoveries, based on the tax rates and laws enacted or substantively enacted as at the balance sheet date.

Deferred taxes are the result of temporary differences arising between the tax bases of assets and liabilities and their carrying amount. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period when the asset is realized or the liability is settled, based on tax rates and laws that have been enacted or substantively enacted at the balance sheet date. Deferred tax assets are recognized for all deductible temporary differences to the extent that it is probable that taxable profit will be available against which the deductible temporary difference can be utilized.

The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that the deferred tax assets will be realized. Unrecognized deferred tax assets are reassessed at each balance sheet date and recognized to the extent that it has become probable that future taxable profit will allow the deferred tax assets to be recovered.

Deferred tax assets are netted against the deferred tax liabilities when they relate to income taxes levied by the same taxation authority on either:

i) the same taxable entity; or

ii) different taxable entities which intend to settle current tax liabilities and assets on a net basis, or to realize the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered.

F-21

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

MATERIAL ACCOUNTING POLICY INFORMATION (cont.)

Deferred tax liabilities are recognized for all taxable temporary differences except when the deferred tax liability arises from the initial recognition of goodwill or the initial recognition of an asset or liability in a transaction which is not a business combination. For taxable temporary differences associated with investments in subsidiaries, a deferred tax liability is recognized unless the parent can control the timing of the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.

Earnings Per Share

For periods prior to the close of the Transaction, basic earnings per share are computed based upon the weighted average number of Common Shares, Non-Voting Participating Preferred Shares and Voting Participating Preferred Shares of Telesat Canada. The quantity of these shares has been recalculated to take into effect the conversion of shares that have occurred during the Transaction. As there was no non-controlling interest in the period prior to the close of the Transaction, all converted amounts have been included as Class A Common Shares, Class B Variable Voting Shares, Class C Fully Voting Shares and Class C Limited Voting Shares of Telesat Corporation.

For periods subsequent to the close of the Transaction, basic earnings per share are computed based upon the weighted average number of Class A Common Shares, Class B Variable Voting Shares, Class C Fully Voting Shares and Class C Limited Voting Shares during each period. Variable Voting and Limited Voting shares are in all respects identical to and treated equally to voting common shares.

For periods prior to the close of the Transaction, diluted earnings per share are based on the weighted average number of common shares as calculated in the basic earnings per share, adjusted for the effect of unvested or unconverted RSUs and stock options that have a dilutive effect. The average market value of the Company’s shares for the purpose of calculating the dilutive effect of the stock options was based on calculated share price of the shares of Telesat Canada, adjusted to consider the impact of the Transaction.

For periods subsequent to the close of the Transaction, diluted earnings per share are based on the weighted average number of Common, Limited Voting and Variable Voting shares outstanding during each period, adjusted for the effect of unvested or unconverted RSUs, PSUs, DSUs and stock options which have a dilutive effect. For 2021, the average market value of the Company’s shares for the purposes of calculating the dilutive effect of the stock options was based on the quoted market prices for the period from November 19, 2021 through December 31, 2021.

Non-Controlling Interests

Non-controlling interests in subsidiaries are identified separately from the Company’s equity therein. Those interests of non-controlling shareholders that are present ownership interests entitling their holders to a proportionate share of net assets upon liquidation may initially be measured at fair value or at the non-controlling interests’ proportionate share of the fair value of the acquiree’s identifiable net assets. The choice of measurement is made on an acquisition-by-acquisition basis. Other non-controlling interests are initially measured at fair value. Subsequent to acquisition, the carrying amount of non-controlling interests is the amount of those interests at initial recognition plus the non-controlling interests’ share of subsequent changes in equity.

The Company reports non-controlling interests as equity, separately on the consolidated balance sheets. In addition, net income (loss) and each component of other comprehensive income (loss) is separately attributed to the non-controlling interests. Total comprehensive income (loss) is attributed to non-controlling interests even if it results in the non-controlling interest having a deficit balance. This is the case even without any existing obligation on the part of the non-controlling interests to make an additional investment to cover the losses. Allocation of net income (loss) and total comprehensive income (loss) is based only on existing ownership interests.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

MATERIAL ACCOUNTING POLICY INFORMATION (cont.)

Future Changes in Accounting Policies

The IASB periodically issues new and amended accounting standards. The new and amended standards determined to be applicable to the Company are disclosed below. The remaining new and amended standards have been excluded as they are not applicable.

Amendments to IAS 1

In October 2022, the IASB amended IAS 1, Presentation of Financial Statements with the aim of improving the information companies provide about long-term debt covenants.

The amendments are effective for annual reporting periods beginning on or after January 1, 2024 with early adoption permitted.

The amendments will not have any impact on the financial statements.

5. CRITICAL ACCOUNTING JUDGMENTS AND ESTIMATES

Critical judgments in applying accounting policies

The following are the critical judgments made in applying the Company’s accounting policies which have the most significant effect on the amounts reported in the financial statements:

Deferred revenue

The Company’s accounting policy relating to deferred revenue is described in Note 4. Certain of the Company’s revenue agreements were noted to include a significant financing component. Judgment by management is required to determine the discount rate used in the significant financing component calculation.

Lease liabilities

The Company’s accounting policy relating to leases is described in Note 4. Judgment by management is required in the determination of the likelihood that the lease renewal periods will be exercised as well as the determination of the incremental borrowing rate.

Uncertain income tax positions

The Company operates in numerous jurisdictions and is subject to country-specific tax laws. Management uses significant judgment when determining the worldwide provision for tax, and estimates provisions for uncertain tax positions as the amounts expected to be paid based on a qualitative assessment of all relevant factors. In the assessment, management considers risk with respect to tax matters under active discussion, audit, dispute or appeal with tax authorities, or which are otherwise considered to involve uncertainty. Management reviews the provisions as at each balance sheet date.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

CRITICAL ACCOUNTING JUDGMENTS AND ESTIMATES (cont.)

Software as a Service arrangements

The Company’s accounting policy relating to SaaS is described in Note 4. Judgment by management is required to determine whether configuration or customization of a software results in an intangible asset for Telesat.

Critical accounting estimates and assumptions

The Company makes accounting estimates and assumptions that affect the carrying value of assets and liabilities, reported net income (loss) and disclosure of contingent assets and liabilities. Estimates and assumptions are based on historical experience, current events and other relevant factors, therefore, actual results may differ and differences could be material.

The accounting estimates and assumptions critical to the determination of the amounts reported in the financial statements were as follows:

Derivative financial instruments measured at fair value

As at December 31, 2023 and 2022, the balances of the derivative assets and liabilities were $Nil.

Quoted market values are unavailable for the Company’s financial instruments and, in the absence of an active market, the Company determines fair value for financial instruments based on prevailing market rates (bid and ask prices, as appropriate) for instruments with similar characteristics and risk profiles or internal or external valuation models, such as option pricing models and discounted cash flow analysis, using observable market-based inputs. The determination of fair value is significantly impacted by the assumptions used for the amount and timing of estimated future cash flows and discount rates. As a result, the fair value of financial assets and liabilities and the amount of gain/loss on changes in fair value of financial instruments recorded to net income (loss) could vary.

Impairment of goodwill

Goodwill represented $2,446.6 million of total assets as at December 31, 2023 and 2022. Determining whether goodwill is impaired requires an estimation of the Company’s fair value which requires management to estimate the future cash flows expected to arise from operations and to make assumptions regarding the underlying business plan, discount rate, and growth rate assumptions. Actual operating results and the related cash flows of the Company could differ from the estimates used for the impairment analysis.

Impairment of intangible assets

Intangible assets represented $692.8 million of total assets as at December 31, 2023 (December 31, 2022 — $756.9 million). Impairment of intangible assets is tested annually or more frequently if indicators of impairment or reversal of a prior impairment loss exist. The impairment analysis requires the Company to estimate the future cash flows expected to arise from operations and to make assumptions regarding the underlying business plan, discount rates, growth rate assumptions and royalty rate. Significant judgments are made in establishing these assumptions. Actual operating results and the related cash flows of the Company could differ from the estimates used for the impairment analysis.

Employee benefits

The cost of defined benefit pension plans and other post-employment benefits, and the present value of the pension obligation are determined using actuarial valuations. An actuarial valuation involves making various assumptions which may differ from actual developments in the future. These include the determination of the discount rate, future salary increases, mortality rates, future pension increases and return on plan assets. Due to the complexity of the valuation, the underlying assumptions, and its long-term nature, the defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed annually.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

CRITICAL ACCOUNTING JUDGMENTS AND ESTIMATES (cont.)

Share-based compensation

Determination of useful life of satellites and finite life intangible assets

Income taxes

Management assesses the recoverability of deferred tax assets based upon an estimation of the Company’s projected taxable income using enacted or substantively enacted tax laws, and its ability to utilize future tax deductions before they expire. Actual results could differ from expectations.

6. SEGMENT INFORMATION

Telesat operates in a single operating segment, in which it provides satellite-based services to its broadcast, enterprise and consulting customers around the world.

The Company derives revenue from the following services:

Broadcast — Direct-to-home television, video distribution and contribution, and occasional use services.

Enterprise — Telecommunication carrier and integrator, government, consumer broadband, resource, maritime and aeronautical, retail and satellite operator services.

Consulting and other — Consulting services related to space and earth segments, government studies, satellite control services, and research and development.

Revenue derived from the above services were as follows:

For the years ended December 31,	2023		2022		2021
Broadcast	$	331,842	$	358,661	$	390,815
Enterprise		359,740		388,985		354,126
Consulting and other		12,579		11,523		13,271
Revenue	$	704,161	$	759,169	$	758,212

Equipment sales included within the various services were as follows:

For the years ended December 31,	2023		2022		2021
Broadcast	$	16	$	81	$	67
Enterprise		12,630		28,071		10,023
Revenue	$	12,646	$	28,152	$	10,090

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

SEGMENT INFORMATION (cont.)

Geographic Information

Revenue by geographic regions was based on the point of origin of the revenue, which was the destination of the billing invoice, and was allocated as follows:

For the years ended December 31,	2023		2022		2021
Canada	$	324,226	$	330,533	$	330,832
United States		245,328		289,946		292,474
Asia & Australia		50,651		45,082		38,266
Latin America & Caribbean		48,664		57,842		55,818
Europe, Middle East & Africa		35,292		35,766		40,822
Revenue	$	704,161	$	759,169	$	758,212

For disclosure purposes, the satellites and the intangible assets have been classified based on ownership. Satellites, property and other equipment and intangible assets by geographic regions were allocated as follows:

As at December 31,	2023		2022
Canada	$	782,639	$	784,261
United Kingdom		446,194		525,672
United States		18,035		36,612
Europe, Middle East & Africa (excluding United Kingdom)		11,395		15,344
All others		2,035		2,195
Satellites, property and other equipment	$	1,260,298	$	1,364,084

As at December 31,	2023		2022
Canada	$	650,528	$	698,336
United States		25,999		40,647
Latin America & Caribbean		11,963		12,754
All others		4,266		5,141
Intangible assets	$	692,756	$	756,878

Other long-term assets by geographic regions were allocated as follows:

As at December 31	2023		2022
Canada	$	40,926	$	47,977
Other long-term assets	$	40,926	$	47,977

Goodwill was not allocated to geographic regions.

Major Customers

For the years ended December 31, 2023, 2022 and 2021 there were two significant customers each representing more than 10% of consolidated revenue.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

7. OPERATING EXPENSES

For the years ended December 31,	2023		2022		2021
Compensation and employee benefits(a)	$	117,917	$	152,154	$	156,112
Other operating expenses(b)		48,120		52,831		50,622
Cost of sales(c)		38,515		54,004		30,215
Operating expenses	$	204,552	$	258,989	$	236,949

____________

(a) Compensation and employee benefits included salaries, bonuses, commissions, post-employment benefits and charges arising from share-based compensation.

(b) Other operating expenses included general and administrative expenses, marketing expenses, in-orbit insurance expenses, professional fees and facility costs. The balance for year ended December 31, 2023 included $1.7 million of leases not capitalized due to exemptions and variable lease payments not included in the measurement of the leases liabilities (December 31, 2022 — $1.7 million).

(c) Cost of sales included the cost of third-party satellite capacity, the cost of equipment sales and other costs directly attributable to fulfilling the Company’s obligations under customer contracts.

The cost of equipment sales included in the cost of sales is as follows:

For the years ended December 31,	2023		2022		2021
Cost of equipment sale	$	7,546	$	26,273	$	6,210

8. OTHER OPERATING GAINS (LOSSES), NET

For the years ended December 31,	2023			2022		2021
Gain (loss) on disposal of assets	$	59		$	7	$	(848	)
C-band clearing income		344,892			—		108,463
Impairment		(79,740	)		—		—
Other		(212	)		—		—
Other operating gains (losses), net	$	264,999		$	7	$	107,615

C-Band Clearing

In 2020, the United States Federal Communications Commission (“FCC”) adopted a Report and Order in connection with the clearing of a 300 MHz band of C-Band downlink spectrum between 3,700 and 4,000 MHz by December 5, 2025 to support the deployment of terrestrial 5G services in the United States (“Report and Order”).

The Report and Order included a provision for an accelerated version of the C-Band spectrum clearing deadlines as follows:

• Phase I: to clear 120 megahertz (3.7 – 3.82 Ghz) by December 5, 2021; and

• Phase II: to clear remaining 180 megahertz (3.82 – 4.0 Ghz) by December 5, 2023.

The Report and Order also provided for reimbursement of reasonable relocation costs to those who are able to meet the deadline of December 5, 2025.

In May 2020, the Company officially committed to the accelerated version of the C-Band clearing program. An amount of $108.5 million (US$84.8 million) was recognized during the year ended December 31, 2021, relating to Phase I accelerated clearing of the C-band spectrum. Of this balance, $42.9 million was received in 2021 with the remaining payments received in 2022.

In June 2023, the Company filed certification of accelerated relocation relating to Phase II. The FCC received no challenges and on June 30, 2023, issued an order validating the certification. An amount of US$259.6 million was accrued and subsequently received during the year ended December 31, 2023, relating to Phase II accelerated clearing of the C-band spectrum. As of December 31, 2023, the Company fulfilled all requirements of the program and all clearing proceeds have been received.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

OTHER OPERATING GAINS (LOSSES), NET (cont.)

Impairment

Indefinite life intangible assets are tested for impairment at the individual CGU level. In the case of orbital slots, the CGU is based on geography. During the year ended December 31, 2023, as a result of impairment testing of the geographical CGUs, there was an impairment of $66.0 million recorded against intangible assets (Note 17) and $13.8 million recorded against satellites, property and other equipment (Note 16).

9. INTEREST EXPENSE

For the years ended December 31,	2023			2022		2021
Interest on indebtedness	$	252,257		$	197,491	$	151,462
Interest on derivative instruments		—			3,040		12,503
Interest on satellite performance incentive payments		1,464			1,797		2,236
Interest on significant financing component		15,713			17,229		18,854
Interest on employee benefit plans (Note 32)		(607	)		588		1,440
Interest on leases		1,523			1,611		1,499
Interest expense	$	270,350		$	221,756	$	187,994

10. INCOME TAXES

For the years ended December 31,	2023		2022			2021
			(Note 3)			(Note 3)
Current tax expense (recovery)	$	75,780	$	77,645		$	85,219
Deferred tax expense (recovery)		13,816		(26,236	)		(14,184	)
Tax expense (recovery)	$	89,596	$	51,409		$	71,035

A reconciliation of the statutory income tax rate, which is a composite of Canadian federal and provincial rates, to the effective income tax rate was as follows:

For the years ended December 31,	2023			2022			2021
				(Note 3)			(Note 3)
Net income (loss) before taxes	$	672,866		$	(30,188	)	$	233,402
Multiplied by the statutory income tax rates		26.40	%		26.44	%		26.46	%
		177,637			(7,982	)		61,758
Income tax recorded at rates different from the Canadian tax rate		(11,518	)		(11,774	)		(38,060	)
Permanent differences		(71,741	)		35,298			8,826
Effect on deferred tax balances due to changes in income tax rates		(407	)		1,870			—
Effect of temporary differences not recognized as deferred tax assets		(4,661	)		32,654			44,591
Taxes related to prior periods		(2,152	)		2,072			(4,769	)
Impact of foreign exchange		2,436			(731	)		(1,232	)
Other		2			2			(79	)
Tax expense (recovery)	$	89,596		$	51,409		$	71,035
Effective income tax rate		13.32	%		(170.30	)%		30.43	%

F-28

Table of Contents

Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

INCOME TAXES (cont.)

The tax effects of temporary differences between the carrying amounts of assets and liabilities for accounting purposes and the amounts used for tax purposes are presented below:

As at December 31,	2023		2022
Deferred tax assets
Foreign tax credits	$	2,999	$	7,293
Corporate interest restriction		7,397		9,035
Financing charges		4,412		8,580
Deferred revenue		7,249		8,668
Loss carry forwards		32,330		34,201
Reserves		1,467		1,550
Other		1,268		2,117
Total deferred tax assets	$	57,122	$	71,444

As at December 31,	2023			2022
Deferred tax liabilities
Capital assets	$	(76,224	)	$	(105,021	)
Intangible assets		(211,491	)		(181,808	)
Employee benefits		(1,700	)		(5,877	)
Total deferred tax liabilities		(289,415	)		(292,706	)
Deferred tax liabilities, net	$	(232,293	)	$	(221,262	)

As at December 31, 2023, deferred tax assets of $3.0 million on the balance sheet relate to Brazil tax jurisdictions (December 31, 2022 — $50.0 million related to Canada and Brazil tax jurisdictions).

Temporary differences, tax losses and tax credits

Foreign tax credit

The Company has Canadian foreign tax credits of $11.4 million which may only be used to offset taxes payable, of which $3.0 million has been recognized. The credits are due to expire between 2025 and 2033.

The Company has United Kingdom foreign tax credits of $9.2 million which have no expiry. No deferred tax asset has been recognized in respect of these foreign tax credits.

The Company has United States foreign tax credits of $145.1 million carried over from 2017. No deferred tax asset has been recognized in respect of these foreign tax credits.

Loss carry forwards and deductible temporary differences

The Company has tax losses in Canada of $90.5 million which will expire starting in 2038 for which a deferred tax asset of $10.6 million has been recognized. The Company also has $83.3 million of deductible temporary differences for which no deferred tax asset has been recognized.

The Company has tax losses in the United Kingdom of $125.1 million that can be carried forward indefinitely, subject to restrictions on their utilization. The use of the losses is limited to 50% of taxable income generated in a carry forward year. Notwithstanding, the Company will be entitled to a £5 million annual allowance of unrestricted taxable income not subject to the 50% limitation. A deferred tax asset of $31.3 million has been recognized in respect of the losses. The Company also has $329.6 million of unused interest deductions in the United Kingdom that can be carried forward indefinitely and a deferred tax asset of $7.4 million has been recognized in respect of these unused interest deductions.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

INCOME TAXES (cont.)

The Company has tax losses of $7.7 million in the United States which can be carried forward indefinitely, and subject to restrictions on their utilization of up to 80% of taxable income generated in a carry forward year. No deferred tax asset has been recognized in respect of the losses. The Company also has $16.0 million of deductible temporary differences for which no deferred tax asset has been recognized.

The Company has tax losses of $3.1 million in Brazil that can be carried forward indefinitely, subject to restrictions on their utilization. The use of the losses is limited to 30% of taxable income generated in a carry forward year. As of December 31, 2023, the Company has cumulative pre-tax income for the last three years and expectation of future income in Brazil, demonstrating sufficient positive evidence to conclude that it is probable that future taxable profit will be available against which the unused tax losses can be utilized. A deferred tax asset of $1.1 million has been recognized in respect of the losses.

Investments in subsidiaries

As at December 31, 2023, the Company had temporary differences of $602.3 million associated with investments in subsidiaries for which no deferred tax liabilities have been recognized, as the Company is able to control the timing of the reversal of these temporary differences and it is not probable that these differences will reverse in the foreseeable future.

11. TRADE AND OTHER RECEIVABLES

As at December 31,	2023			2022
Trade receivables	$	54,024		$	34,152
Less: allowance for doubtful accounts		(6,467	)		(4,901	)
Net trade receivables		47,557			29,251
Deferred receivables		3,347			5,038
Government grant receivable (Note 28)		20,697			2,457
Other receivables		6,688			4,502
Trade and other receivables	$	78,289		$	41,248

Allowance for doubtful accounts

The movement in the allowance for doubtful accounts was as follows:

Years ended December 31,	2023			2022
Allowance for doubtful accounts, beginning of year	$	4,901		$	5,216
Provisions (reversals) for impaired receivables		2,881			2,339
Receivables written off		(1,242	)		(2,924	)
Impact of foreign exchange		(73	)		270
Allowance for doubtful accounts, end of year	$	6,467		$	4,901

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

12. OTHER CURRENT FINANCIAL ASSETS

As at December 31,	2023		2022
Security deposits	$	631	$	515
Other current financial assets	$	631	$	515

13. PREPAID EXPENSES AND OTHER CURRENT ASSETS

As at December 31,	2023		2022
Transaction costs(a)	$	39,317	$	33,695
Prepaid expenses		6,607		14,342
Inventory(b)		4,317		2,023
Deferred charges(c)		247		264
Other		1,681		—
Prepaid expenses and other current assets	$	52,169	$	50,324

____________

(a) Transaction costs represent the incremental costs in connection with the debt and equity financing.

(b) As at December 31, 2023, inventory consisted of $2.8 million of work in progress (December 31, 2022 — $0.2 million) and $1.5 million of other inventory (December 31, 2022 — $1.8 million).

14. OTHER LONG-TERM FINANCIAL ASSETS

As at December 31,	2023		2022
Deferred receivables	$	5,635	$	8,893
Security deposits		998		816
Other long-term receivables		—		767
Other long-term financial assets	$	6,633	$	10,476

15. OTHER LONG-TERM ASSETS

As at December 31,	2023		2022
Pension benefits (Note 32)	$	40,624	$	47,312
Other		302		302
Prepaid expenses		—		116
Deferred charges (Note 13)		—		247
Other long-term assets	$	40,926	$	47,977

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

16. SATELLITES, PROPERTY AND OTHER EQUIPMENT

	Satellites			Antennas,<br>satellite<br>control &<br>communication<br>equipment			Building,<br>equipment &<br>other			Right-of-use<br>assets(1)			Assets under<br>construction			Total
Cost as at January 1, 2022	$	3,378,510		$	171,785		$	85,735		$	43,380		$	390,540		$	4,069,950
Additions		—			56			865			921			54,570			56,412
Disposals/retirements		—			(1,415	)		(2,464	)		(932	)		—			(4,811	)
Transfers from assets under construction		—			1,862			1,526			—			(3,388	)		—
Impact of foreign exchange		55,463			2,296			558			983			28,513			87,813
Cost as at December 31, 2022		3,433,973			174,584			86,220			44,352			470,235			4,209,364
Additions		—			52			615			1,473			114,090			116,230
Disposals/retirements		—			(4,433	)		(2,880	)		(156	)		—			(7,469	)
Transfers from assets under construction		9,598			4,890			3,530			—			(18,018	)		—
Impact of foreign exchange		(18,810	)		(612	)		(103	)		(316	)		(12,166	)		(32,007	)
Cost as at December 31, 2023	$	3,424,761		$	174,481		$	87,382		$	45,353		$	554,141		$	4,286,118
Accumulated depreciation and impairment as at January 1, 2022	$	(2,445,367	)	$	(129,864	)	$	(57,689	)	$	(7,342	)	$	—		$	(2,640,262	)
Depreciation		(172,331	)		(8,786	)		(4,313	)		(3,325	)		—			(188,755	)
Disposals/retirements		—			1,414			2,296			462			—			4,172
Impact of foreign exchange		(18,734	)		(945	)		(517	)		(239	)		—			(20,435	)
Accumulated depreciation and impairment as at December 31, 2022		(2,636,432	)		(138,181	)		(60,223	)		(10,444	)		—			(2,845,280	)
Depreciation		(167,393	)		(7,996	)		(4,118	)		(3,162	)		—			(182,669	)
Impairment		(13,787	)		—			—			—			—			(13,787	)
Disposals/retirements		—			4,497			2,921			156			—			7,574
Impact of foreign exchange		8,053			296			(114	)		107			—			8,342
Accumulated depreciation and impairment as at December 31, 2023	$	(2,809,559	)	$	(141,384	)	$	(61,534	)	$	(13,343	)	$	—		$	(3,025,820	)
Net carrying values
As at December 31, 2022	$	797,541		$	36,403		$	25,997		$	33,908		$	470,235		$	1,364,084
As at December 31, 2023	$	615,202		$	33,097		$	25,848		$	32,010		$	554,141		$	1,260,298

____________

(1) Right-of-use assets consisted primarily of property leases.

Substantially all of the Company’s satellites, property and other equipment, excluding satellites, property and other equipment held in unrestricted subsidiaries, have been pledged as security as a requirement of the Company’s Senior Secured Credit Facilities, Senior Secured Notes and 2026 Senior Secured Notes as at December 31, 2023 (Note 24).

Borrowing costs

For the year ended December 31, 2023 and 2022 there were no borrowing costs capitalized.

Impairment

Indefinite life intangible assets are tested for impairment at the individual CGU level. In the case of orbital slots, the CGU is based on geography. During the year ended December 31, 2023, as a result of impairment testing of the geographical CGUs, there was an impairment of $13.8 million recorded against satellites, property and other equipment. The impairment resulted from changes to the underlying assumptions associated with the related business plan.

There was no impairment recognized for the year ended December 31, 2022.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

SATELLITES, PROPERTY AND OTHER EQUIPMENT (cont.)

Joint arrangements

Telesat International Limited (“TIL”) and APT entered into agreements relating to the Telstar 18 VANTAGE satellite, which are accounted for as a joint operation, whereby TIL’s interest is 42.5%. Telesat (IOM) Limited (“TIOM”) and Viasat Inc. entered into agreements relating to the ViaSat-1 satellite, which are accounted for as a joint operation, whereby TIOM owns the Canadian payload on the ViaSat-1 satellite.

17. INTANGIBLE ASSETS

The intangible assets are split between assets with finite and indefinite lives.

The indefinite life intangible assets are summarized below.

	Orbital slots			Trade name		Intellectual<br>property			Total indefinite<br>life intangible<br>assets
Cost as at January 1, 2022	$	606,945		$	17,000	$	64,392		$	688,337
Impact of foreign exchange		2,797			—		4,673			7,470
Cost as at December 31, 2022		609,742			17,000		69,065			695,807
Additions		—			—		16,416			16,416
Impact of foreign exchange		(949	)		—		(1,585	)		(2,534	)
Cost as at December 31, 2023	$	608,793		$	17,000	$	83,896		$	709,689
Accumulated impairment as at January 1, 2022	$	(1,100	)	$	—	$	—		$	(1,100	)
Impairment		—			—		—			—
Accumulated impairment as at December 31, 2022		(1,100	)		—		—			(1,100	)
Impairment		(65,953	)		—		—			(65,953	)
Impact of foreign exchange		173			—		—			173
Accumulated impairment as at December 31, 2023	$	(66,880	)	$	—	$	—		$	(66,880	)
Net carrying values
As at December 31, 2022	$	608,642		$	17,000	$	69,065		$	694,707
As at December 31, 2023	$	541,913		$	17,000	$	83,896		$	642,809

There were no disposals or retirements in the years ended December 31, 2023 and 2022 and no additions for the year ended December 31, 2022.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

INTANGIBLE ASSETS (cont.)

The finite life intangible assets are summarized below.

	Revenue<br>backlog			Customer<br>relationships			Customer<br>contracts			Transponder<br>rights			Concession<br>rights			Software			Other			Total<br>finite life<br>intangible<br>assets
Cost as at January 1, 2022	$	223,664		$	194,526		$	12,618		$	16,718		$	21,077		$	1,193		$	59		$	469,855
Additions		—			—			—			—			71			—			—			71
Impact of foreign exchange		—			201			—			—			2,720			—			—			2,921
Cost as at December 31, 2022		223,664			194,727			12,618			16,718			23,868			1,193			59			472,847
Additions		—			—			—			—			56			—			—			56
Impact of foreign exchange		—			(68	)		—			—			1,575			—			—			1,507
Cost as at December 31, 2023	$	223,664		$	194,659		$	12,618		$	16,718		$	25,499		$	1,193		$	59		$	474,410
Accumulated amortization and impairment as at January 1, 2022	$	(214,571	)	$	(147,772	)	$	(8,390	)	$	(15,100	)	$	(8,434	)	$	(119	)	$	(47	)	$	(394,433	)
Amortization		(4,375	)		(6,872	)		(844	)		(1,079	)		(1,568	)		(238	)		(3	)		(14,979	)
Impact of foreign exchange		—			(153	)		—			—			(1,111	)		—			—			(1,264	)
Accumulated amortization and impairment as at December 31, 2022		(218,946	)		(154,797	)		(9,234	)		(16,179	)		(11,113	)		(357	)		(50	)		(410,676	)
Amortization		(2,916	)		(6,879	)		(845	)		(539	)		(1,672	)		(239	)		(3	)		(13,093	)
Impact of foreign exchange		—			57			—			—			(751	)		—			—			(694	)
Accumulated amortization and impairment as at December 31, 2023	$	(221,862	)	$	(161,619	)	$	(10,079	)	$	(16,718	)	$	(13,536	)	$	(596	)	$	(53	)	$	(424,463	)
Net carrying values
As at December 31, 2022	$	4,718		$	39,930		$	3,384		$	539		$	12,755		$	836		$	9		$	62,171
As at December 31, 2023	$	1,802		$	33,040		$	2,539		$	—		$	11,963		$	597		$	6		$	49,947

There were no disposals/retirements in the years ended December 31, 2023 and 2022.

The total combined indefinite and finite life intangible assets are summarized below.

	As at December 31, 2023							As at December 31, 2022
	Cost		Accumulated<br>amortization<br>and<br>impairment			Net carrying<br>value		Cost		Accumulated<br>amortization<br>and<br>impairment			Net carrying<br>value
Indefinite life intangibles	$	709,689	$	(66,880	)	$	642,809	$	695,807	$	(1,100	)	$	694,707
Finite life intangibles		474,410		(424,463	)		49,947		472,847		(410,676	)		62,171
Total intangibles	$	1,184,099	$	(491,343	)	$	692,756	$	1,168,654	$	(411,776	)	$	756,878

The orbital slots represent a right to operate satellites in a given longitudinal coordinate in space, where geostationary orbit may be achieved. They are limited in availability and represent a scarce resource. Usage of orbital slots is licensed through the International Telecommunications Union. Satellite operators can generally expect, with a relatively high level of certainty, continued occupancy of an assigned orbital slot either during the operational life of an existing orbiting satellite or upon replacement by a new satellite once the operational life of the existing orbiting satellite is over. As a result of the expectancy right to maintain the once awarded orbital slots, an indefinite life is typically associated with orbital slots.

The Company’s trade name has a long and established history, a strong reputation and has been synonymous with quality and growth within the satellite industry. It has been assigned an indefinite life because of expected ongoing future use.

The Company’s intellectual property relates to development of the planned Telesat Lightspeed constellation. It has been assigned an indefinite life because of anticipated ongoing future use.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

INTANGIBLE ASSETS (cont.)

The following are the remaining useful lives of the intangible assets:

	Years
Revenue backlog	1
Customer relationships	3 to 5
Customer contracts	3
Concession rights	1 to 14
Software	2
Patent	2

All of the Company’s intangible assets, excluding the intangible assets held in unrestricted subsidiaries, have been pledged as security as a requirement of the Company’s Senior Secured Credit Facilities, Senior Secured Notes and 2026 Senior Secured Notes (Note 24).

Impairment

Finite life intangible assets are assessed for impairment at the Company’s CGU level. With the exception of trade name, which is tested for impairment at the asset level, the indefinite life intangible assets are tested for impairment at the individual CGU level. In the case of orbital slots, the CGU is based on geography. The annual impairment tests for these assets were performed in the fourth quarters of 2023 and 2022 in accordance with the policy described in Note 4.

Subsequent to the annual impairment tests, the Company identified indicators of impairment as of December 31, 2023, requiring additional impairment tests of the geographical CGUs. This resulted in an impairment of $64.0 million recorded against the North American CGU and $15.8 million relating to the international CGU. The full amount of the impairment for the North American CGU was recorded against intangible assets. For the international CGU, the impairment was split between $2.0 million being recorded against intangible assets and $13.8 million being recorded against satellites, property and other equipment (Note 16). The impairment resulted from changes to the underlying assumptions associated with the related business plan, particularly related to the revenue forecasts as a result of intensifying competition.

Apart from the orbital slots, there were no other impairments recognized in the year ended December 31, 2023 tied to intangible assets. There was no impairment recognized for the year ended December 31, 2022.

Orbital slots

The orbital slots were valued using an income approach.

The income approach is most sensitive to the following assumptions:

• Movements in the underlying business plan;

• Discount rate; and

• Growth rate assumptions.

Movements in the underlying business plan

The business plans reflect the most up-to-date assumptions concerning the markets and development and trends in the business. For the provision of satellite capacity, the business plan will take into account the following factors:

• The expected developments in sale of satellite capacity;

• Any changes in the expected capital expenditure cycle; and

• Any changes in satellite procurement, launch or cost assumptions.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

INTANGIBLE ASSETS (cont.)

Discount rates

Discount rates reflect management’s estimates of the specific risks. Management uses a weighted average cost of capital as a discount rate. The discount rates used was 9.0% and 9.5% in 2023 (9.0% in 2022).

Growth rate assumptions

Growth rate assumptions used to extrapolate the cash flows beyond the business planning period are based on commercial experience and the expectations for the development of the markets which they serve.

Trade name

Relief from royalty method was used to calculate the fair value of the Telesat trade name. The relief from royalty analysis requires determining a hypothetical royalty rate and subsequent application of the rate to projected revenue.

The relief from royalties method is most sensitive to the following assumptions:

• Movements in the underlying business plan;

• Royalty rate;

• Discount rate; and

• Growth rate assumptions.

Movements in the underlying business plan

Royalty rate

The determination of the hypothetical royalty rate used in the relief from royalty approach will consider comparable license agreements and other qualitative factors. The royalty rate used for 2023 and 2022 was 0.25% of revenue.

Discount rates

Discount rates reflect management’s estimates of the specific risks. Management uses a weighted average cost of capital as a discount rate. The discount rates used was the following:

	2023	2022
GEO royalties	9.5%	9.0%
LEO royalties	Midpoint between 15% and 20%	Midpoint between 15% and 20%

Growth rate assumptions

	2023		2022
GEO	—	%	—	%
LEO	2.0	%	2.0	%

Some of the more sensitive assumptions used in the quantitative analysis, including the forecasted cash flows and the discount rate, could have yielded different estimates of the recoverable amount. Actual operating results and the related cash flows of the Company could differ from the estimated operating results and related cash flows used in the impairment analysis, and had different estimates been used, it could have resulted in a different fair value.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

18. GOODWILL

The Company carries goodwill at its cost of $2,446.6 million with no accumulated impairment losses since acquisition.

Impairment

Goodwill is tested for impairment at the entity level because that represents the lowest level at which goodwill supports the Company’s operations and is monitored internally. The annual impairment test on goodwill was performed in the fourth quarters of 2023 and 2022 in accordance with the policy described in Note 4.

In 2023 and 2022, the Company’s recoverable amount exceeded the carrying value therefore, no impairment was recognized.

The calculation of the recoverable amount is most sensitive to the following assumptions:

• Movements in the underlying business plan;

• Discount rate; and

• Growth rate assumptions.

Movements in the underlying business plan

• The expected developments in sale of satellite capacity and the development of the Telesat Lightspeed market;

• Any changes in the expected capital expenditure cycle, including estimated costs on the development of the Telesat Lightspeed constellation; and

• Any changes in satellite procurement, launch or cost assumptions.

Discount rates

Discount rates reflect management’s estimates of the specific risks. Management uses a weighted average cost of capital as a discount rate. The discount rates used in the calculation are presented below:

	2023	2022
GEO	9.5%	9.0%
LEO	Midpoint between 15% and 20%	Midpoint between 15% and 20%
U.S. C-band clearing proceeds	N/A	9.0%

Growth rate assumptions

Some of the more sensitive assumptions used in the quantitative analysis, including the underlying business plans, discount rates, and the growth rate assumptions, could have yielded different estimates of the recoverable amount. Actual operating results and the related cash flows of the Company could differ from the estimated operating results and related cash flows used in the impairment analysis, and had different estimates been used, it could have resulted in a different fair value.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

19. TRADE AND OTHER PAYABLES

As at December 31,	2023		2022
Trade payables	$	4,570	$	1,976
Other payables and accrued liabilities(a)		39,056		41,579
Trade and other payables	$	43,626	$	43,555

____________

(a) Other payables and accrued liabilities included payables that are not trade in nature as well as various operating and capital accruals.

20. OTHER CURRENT FINANCIAL LIABILITIES

As at December 31,	2023		2022
Security deposits	$	623	$	632
Satellite performance incentive payments		4,522		6,567
Interest payable(a)		21,719		38,536
Other		2,197		2,662
Other current financial liabilities	$	29,061	$	48,397

____________

(a) Interest payable included interest payable on indebtedness and satellite performance incentive payments.

21. OTHER CURRENT LIABILITIES

As at December 31,	2023		2022
Deferred revenue (Note 23)	$	55,111	$	66,828
Decommissioning liabilities (Note 23)		231		975
Uncertain tax positions		1,315		1,315
Lease liabilities		2,217		2,120
Other		4,245		4,730
Other current liabilities	$	63,119	$	75,968

22. OTHER LONG-TERM FINANCIAL LIABILITIES

As at December 31,	2023		2022
Security deposits	$	1,189	$	1,106
Satellite performance incentive payments		13,749		18,557
Other long-term financial liabilities	$	14,938	$	19,663

23. OTHER LONG-TERM LIABILITIES

As at December 31,	2023		2022
Deferred revenue(b)	$	224,329	$	259,579
Accrued benefit liabilities (Note 32)		32,352		32,862
Uncertain tax positions		175		175
Decommissioning liabilities(a)		2,463		2,453
Lease liabilities(c)		31,122		31,986
Other long-term liabilities	$	290,441	$	327,055

____________

(a) The current and long-term decommissioning liabilities on property and equipment were $2.7 million (December 31, 2022 — $3.4 million). The decommissioning liabilities are for the restoration of leased buildings and teleports. During the years ended December 31, 2023 and 2022 there was $Nil interest expense recorded. During the year ended December 31, 2023 there were $0.9 million decommissioning liabilities derecognized (December 31, 2022 — $Nil). It is expected that the decommissioning liabilities will mature between 2024 and 2062.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

OTHER LONG-TERM LIABILITIES (cont.)

(b) Remaining performance obligations, which the Company also refers to as contract revenue backlog (“backlog”) represents the expected future revenue under existing customer contracts, includes both cancellable and non-cancellable contracts, and any deferred revenue that will be recognized in the future in respect to cash already received. The Company does not include revenue beyond the stated expiration of the contract regardless of potential for renewal.

The Company expects the backlog as at December 31, 2023 to be recognized as follows (in millions of Canadian dollars):

2024		2025		2026		2027		2028		Thereafter		Total
$	454	$	277	$	202	$	131	$	68	$	216	$	1,348

2024		2025		2026		2027		2028		Thereafter		Total
$	3,785	$	3,710	$	3,067	$	2,886	$	2,917	$	30,841	$	47,206

The undiscounted contractual cash flows included $13.4 million of interest payments.

24. INDEBTEDNESS

As at December 31,			2022
Senior Secured Credit Facilities
Revolving Credit Facility	—		$	—
Term Loan B – U.S. Facility(December 31, 2023 – US1,421,767 and December 31, 2022 – US1,552,815)	1,882,846			2,104,685
Senior Unsecured Notes(December 31, 2023 – US295,000 and December 31, 2022 – US390,000)	390,669			528,606
2026 Senior Secured Notes(December 31, 2023 – US399,040 and December 31, 2022 – US500,000)	528,449			677,700
Senior Secured Notes(December 31, 2023 – US299,995 and December 31, 2022 – US400,000)	397,283			542,160
	3,199,247			3,853,151
Deferred financing costs, prepayment options and loss on repayment	(2,228	)		(3,070	)
	3,197,019			3,850,081
Less: current indebtedness	—			—
Long-term indebtedness	3,197,019		$	3,850,081

All values are in US Dollars.

Term Loan B — U.S. Facility and Revolving Credit Facility

On December 6, 2019, Telesat Canada entered into a new amended and restated Credit Agreement (“2019 Amendment”) with a syndicate of banks which provides for the extension of credit under the Senior Secured Credit Facilities (“Senior Secured Credit Facilities”). The Senior Secured Credit Facilities, have two tranches which are described below:

(i) A Revolving Credit Facility (“Revolving Facility”) of up to $200.0 million U.S. dollars (or Canadian dollar equivalent) is available to Telesat Canada maturing in December 2024. This Revolving Facility is available to be drawn at any time in U.S. funds or Canadian dollar equivalent funds. Loans under the Revolving Facility bore interest at a floating interest rate. For Canadian Prime Rate and Alternative Base Rate (“ABR”) loans, an applicable margin ranging from 0.75% to 1.25% is applied to the Prime Rate and ABR as these interest rates are defined in the Senior Secured Credit Facilities. For Bankers Acceptance (“BA”) Loans and Eurodollar Loans, an applicable margin ranging from 1.75% to 2.25% is applied to

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

INDEBTEDNESS (cont.)

either the BA interest rate or LIBOR. The rates on the Revolving Facility vary depending upon the results of the first lien leverage ratio. The Revolving Facility has an unused commitment fee that ranges from 25.0 to 37.5 basis points per annum, depending upon the result of the total leverage ratio.

On May 9, 2023, Telesat Canada entered into a seventh amendment to the Credit Agreement. The seventh amendment amends the Credit Agreement to replace LIBOR-based benchmark rates with Secured Overnight Financing Rate (“SOFR”)-based benchmark rates and to make certain other conforming changes. Following the seventh amendment, loans under the Revolving Facility will bear interest, at Telesat Canada’s option, at either (x) in the case of loans denominated in Canadian Dollars, (i) a floating rate based on the Canadian prime rate, plus an applicable margin ranging from 0.75% to 1.25% or (ii) a floating rate based on the Canadian BA rate, plus an applicable margin ranging from 1.75% to 2.25%, or (y) in the case of loans denominated in US dollars, (i) a floating rate based on the base rate, plus an applicable margin ranging from 0.75% to 1.25% or (ii) a floating rate based on SOFR, plus an applicable margin ranging from 1.75% to 2.25%. As at December 31, 2023, other than $0.2 million (December 31, 2022 — $0.2 million) in drawings related to letters of credit, there were no borrowings under this facility.

(ii) The U.S. TLB Facility is a US$1,908.5 million facility maturing in December 2026 (“U.S. TLB Facility”). The borrowings under the U.S. TLB Facility bore interest at a floating rate of either: (i) LIBOR as periodically determined for interest rate periods selected by Telesat Canada in accordance with the terms of the Senior Secured Credit Facilities, plus an applicable margin of 2.75%; or (ii) Alternative Base Rate as determined in accordance with the terms of the Senior Secured Credit Facilities plus an applicable margin of 1.75%. The mandatory principal repayment is equal to 0.25% of the original aggregate principal amount, payable on the last day of each quarter, commencing on March 31, 2020. As a result of the prepayment made in December 2020, mandatory quarterly principal repayments are no longer be required.

Debt issue costs of $16.0 million were incurred in connection with the 2019 Amendment, inclusive of $1.3 million relating to the revolving credit facility. As at December 31, 2023, the debt costs had a carrying value of $6.1 million (December 31, 2022 — $8.6 million). The Senior Secured Credit Facilities are secured by substantially all of Telesat Canada’s assets, excluding those in the unrestricted subsidiaries. All obligations under the Credit Agreement are guaranteed by Telesat Canada and certain existing subsidiaries (“Guarantors”). The obligations under the Credit Agreement and the guarantees of those obligations are secured, subject to certain exceptions, by first priority liens and security interest in the assets of Telesat Canada and the Guarantors. The Credit Agreement contains total leverage ratio covenants that restrict, with certain exceptions, the ability of Telesat Canada and the Guarantors to take specified actions, including, among other things and subject to certain significant exceptions: creating liens, incurring indebtedness, making investments, engaging in mergers, selling property, paying dividends, entering into sale-leaseback transactions, creating subsidiaries, repaying subordinated debt or amending organizational documents. If the Revolving Credit Facility is drawn by more than 35% of the Credit Facility amount, the Credit Agreement requires Telesat Canada to comply with a first lien net leverage ratio of 5.75:1.00, tested quarterly, and failure to comply will result in an event of default. As at December 31, 2023, the total leverage ratio was 5.32:1.00, which is more than the maximum test ratio of 4.50:1.00 (December 31, 2022 — 6.17:1.00).

In December 2020, the Company made a US$341.4 million prepayment on the Term Loan B — U.S. Facility. The prepayment was applied to all mandatory future quarterly principal repayments, with the remaining balance of the prepayment being applied towards the principal amount outstanding on maturity. The prepayment resulted in the

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

INDEBTEDNESS (cont.)

recognition of a loss of $2.3 million, which was recorded against interest and other income and indebtedness. The loss recorded against the indebtedness is subsequently amortized to interest expense using the effective interest method and had a carrying value of $1.1 million as at December 31, 2023 (December 31, 2022 — $1.6 million).

During the year ended December 31, 2023, Telesat Canada repurchased a portion of Term Loan B — U.S. Facility with a principal amount of $177.6 million (US$131.0 million) in exchange for $133.8 million (US$98.8 million). The repurchase resulted in a write-off of the related debt issue costs and loss on repayment in the amount of $0.5 million (US$0.4 million), and a gain on repurchase of debt of $43.8 million (US$32.3 million).

The weighted average effective interest rate for the year ended December 31, 2023 was 8.08% (December 31, 2022 — 4.64%).

Senior Unsecured Notes

On October 11, 2019, Telesat Canada issued, through a private placement, US$550 million of Senior Unsecured Notes which mature in October 2027. The Senior Unsecured Notes bear interest at an annual rate of 6.5% with interest payments payable in April and October, annually, which commenced in April 2020. Debt issue costs of $7.4 million were incurred in connection with the issuance of the Senior Unsecured Notes and had a carrying value of $2.5 million as at December 31, 2023 (December 31, 2022 — $3.7 million).

The Senior Unsecured Notes include covenants or terms that restrict the Company’s ability to, among other things: (i) incur or guarantee additional indebtedness, or issue disqualified stock or preferred shares, (ii) incur liens, (iii) pay dividends, or make certain restricted payments or investments, (iv) enter into certain transactions with affiliates, (v) modify or cancel satellite insurance, (vi) consolidate, merge, sell or otherwise dispose of substantially all assets, (vii) create restrictions on the ability to pay dividends, make loans, and sell assets, and (viii) designate subsidiaries as unrestricted subsidiaries.

The Senior Unsecured Notes are structurally subordinated to Telesat Canada’s existing and future secured indebtedness, including obligations under its Senior Secured Credit Facilities and Senior Secured Notes. The Senior Unsecured Notes are governed by the Senior Unsecured Notes Indenture.

The indenture agreement for the Senior Unsecured Notes contained provisions for certain prepayment options which were fair valued at the time of debt issuance. The initial fair value impact, as at October 11, 2019, of the prepayment option related to the Senior Unsecured Notes was a $17.8 million increase to the indebtedness. This liability is subsequently amortized using the effective interest method and had a carrying amount of $6.0 million as at December 31, 2023 (December 31, 2022 — $8.8 million).

During the year ended December 31, 2023, Telesat Canada repurchased Senior Unsecured Notes with a principal amount of $128.9 million (US$95.0 million) in exchange for $53.7 million (US$39.5 million). The repurchase resulted in a write-off of the related debt issue costs and prepayment options in the amount of $0.8 million (US$0.6 million), and a gain on repurchase of debt of $75.3 million (US$55.5 million).

During the year ended December 31, 2022, Telesat Canada repurchased for retirement Senior Unsecured Notes with a principal amount of $202.1 million (US$160.0 million) in exchange for $97.2 million (US$77.0 million). The repurchase resulted in a write-off of the related debt issue costs and prepayment options in the amount of $1.9 million (US$1.5 million), and a gain on extinguishment of debt of $106.9 million (US$84.5 million).

The weighted average effective interest rate for the year ended December 31, 2023 was 6.25% (December 31, 2022 — 6.27%).

Senior Secured Notes

On December 6, 2019, Telesat Canada issued, through private placement, US$400 million of Senior Secured Notes, which mature in June 2027. The Senior Secured Notes bear interest at an annual rate of 4.875% with interest payable on June 1 and December 1, annually, which commenced in June 2020. Debt issue costs of $6.6 million were incurred in connection with the issuance of the Senior Secured Notes and had a carrying value of $2.6 million as at December 31, 2023 (December 31, 2022 — $4.2 million).

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

INDEBTEDNESS (cont.)

The Senior Secured Notes are guaranteed by the Company and certain Guarantors. The Senior Secured Notes are governed by the Senior Secured Notes Indenture. The obligations under the Senior Secured Notes Indenture are secured, subject to certain exceptions, by first priority liens and security interest in the assets of Telesat Canada and the Guarantors. The Senior Secured Notes include covenants or terms that restricts the Company’s ability to, among other things: (i) incur or guarantee additional indebtedness, or issue disqualified stock or preferred shares, (ii) incur liens, (iii) pay dividends, or make certain restricted payments or investments, (iv) enter into certain transactions with affiliates, (v) modify or cancel satellite insurance, (vi) consolidate, merge, sell or otherwise dispose of substantially all assets, (vii) create restrictions on the ability to pay dividends, make loans, and sell assets, and (viii) designate subsidiaries as unrestricted subsidiaries.

The indenture agreement for the Senior Secured Notes contained provisions for certain prepayment options which were fair valued at the time of debt issuance. The initial fair value impact, as at December 6, 2019, of the prepayment option related to the Senior Secured Notes was a $10.6 million increase to the indebtedness. This liability is subsequently amortized using the effective interest method and had a carrying amount of $4.1 million as at December 31, 2023 (December 31, 2022 — $6.7 million).

During the year ended December 31, 2023, Telesat Canada repurchased Senior Secured Notes with a principal amount of $133.6 million (US$100.0 million) in exchange for $77.0 million (US$57.6 million). The repurchase resulted in a write-off of the related debt issue costs and prepayment options in the amount of $0.5 million (US$0.4 million), and a gain on repurchase of debt of $56.7 million (US$42.4 million).

The weighted average effective interest rate for the year ended December 31, 2023 was 4.75% (December 31, 2022 — 4.76%).

2026 Senior Secured Notes

On April 27, 2021, Telesat Canada, as issuer, and Telesat LLC, as co-issuer, issued US$500 million in aggregate principal amount of 2026 Senior Secured Notes maturing on December 6, 2026. The 2026 Senior Secured Notes bear interest at an annual rate of 5.625% with interest payable on June 1 and December 1, which commenced in December 2021 to holders of record on the immediately preceding May 15 or November 15, as the case may be. Debt issue costs of $6.8 million were incurred in connection with the issuance of the 2026 Senior Secured Notes and had a carrying value of $3.1 million as at December 31, 2023 (December 31, 2022 — $5.0 million).

The 2026 Senior Secured Notes are guaranteed by the Company and certain Guarantors. The 2026 Senior Secured Notes are governed by the 2026 Senior Secured Notes Indenture. The obligations under the 2026 Senior Secured Notes Indenture are secured, subject to certain exceptions, by first priority liens and security interest in the assets of Telesat Canada and the Guarantors. The 2026 Senior Secured Notes include covenants or terms that restricts the Company’s ability to, among other things: (i) incur or guarantee additional indebtedness, or issue disqualified stock or preferred shares, (ii) incur liens, (iii) pay dividends, or make certain restricted payments or investments, (iv) enter into certain transactions with affiliates, (v) modify or cancel satellite insurance, (vi) consolidate, merge, sell or otherwise dispose of substantially all assets, (vii) create restrictions on the ability to pay dividends, make loans, and sell assets, and (viii) designate subsidiaries as unrestricted subsidiaries.

The indenture agreement for the 2026 Senior Secured Notes contained provisions for certain prepayment options which were fair valued at the time of debt issuance. The initial fair value impact, as at April 27, 2021, of the prepayment option related to the 2026 Senior Secured Notes was a $1.9 million increase to the indebtedness. This liability is subsequently amortized using the effective interest method and had a carrying amount of $0.9 million as at December 31, 2023 (December 31, 2022–$1.4 million).

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

INDEBTEDNESS (cont.)

During the year ended December 31, 2023, Telesat Canada repurchased 2026 Senior Secured Notes with a principal amount of $134.5 million (US$101.0 million) in exchange for $79.6 million (US$59.7 million). The repurchase resulted in a write-off of the related debt issue costs and prepayment options in the amount of $0.6 million (US$0.5 million), and a gain on repurchase of debt of $55.0 million (US$41.2 million).

The weighted average effective interest rate for year ended December 31, 2023 and 2022 was 5.79%.

The U.S. TLB Facility, Senior Unsecured Notes, Senior Secured Notes and 2026 Senior Secured Notes were presented on the balance sheet net of related deferred financing costs. The deferred financing costs are amortized using the effective interest method. The short-term and long-term portions of deferred financing costs, prepayment options and loss on repayment were as follows:

As at December 31,	2023			2022
Short-term deferred financing costs	$	—		$	—
Long-term deferred financing costs		14,298			21,470
	$	14,298		$	21,470
Short-term prepayment options	$	—		$	—
Long-term prepayment options		(10,961	)		(16,832	)
	$	(10,961	)	$	(16,832	)
Short-term loss on repayment	$	—		$	—
Long-term loss on repayment		(1,109	)		(1,568	)
	$	(1,109	)	$	(1,568	)
Deferred financing costs, prepayment options and loss on repayment	$	2,228		$	3,070

25. SHARE CAPITAL

The authorized capital of the Corporation consists of the following:

• An unlimited number of Class A Common shares,

• An unlimited number of Class B Variable Voting shares,

• An unlimited number of Class C Fully Voting shares,

• An unlimited number of Class C Limited Voting shares,

• Class A Special Voting shares,

• Class B Special Voting shares,

• Class C Special Voting shares,

• Golden Share, and

• An unlimited number of Class A Preferred shares.

The Class A Common shares together with the Class B Variable Voting shares represent the Corporation’s Public Shares (“Telesat Public Shares”). The Class C Fully Voting shares and Class C Limited Voting shares shall be referred to as (“Class C Shares”). The Telesat Public Shares and Class C Shares shall represent Telesat Corporation Shares (“Telesat Corporation Shares”). Class A Special Voting Share, Class B Special Voting Share and Class C Special Voting Share together are referred as (“Special Voting Shares”).

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

SHARE CAPITAL (cont.)

The number of shares and stated value of the outstanding shares were as follows:

	December 31,<br>2023			December 31,<br>2022
	Number of<br>shares	Stated<br>value		Number of<br>shares	Stated<br>value
Telesat Public Shares	13,497,501	$	44,912	12,692,450	$	40,214
Class C Shares	112,841		6,340	112,841		6,340
	13,610,342	$	51,252	12,805,291	$	46,554

The breakdown of the number of Telesat Public Shares, as at December 31, 2023, was as follows:

Telesat Public shares
Class A Common shares	1,242,656
Class B Variable Voting shares	12,254,845
Total Telesat Public shares	13,497,501

The number of Class A Common shares and Class B Variable Voting shares in the table above is based on information available to the Company as at December 31, 2023.

In addition, the Company has one Class A Special Voting Share, one Class B Special Voting Share, one Class C Special Voting Share and one Golden Share outstanding, each with a nominal stated value as at December 31, 2023 and 2022.

In September 2021, 600 stock options were exercised in exchange for 600 Non-Voting Participating Preferred shares of Telesat Canada.

In November 2021, dividends were declared and paid on the Director Voting Preferred Shares of Telesat Canada.

During the year ended December 31, 2022, 411,146 RSUs were settled for 210,978 Telesat Public Shares, on a net settlement basis.

During the year ended December 31, 2022, 574,226 Telesat Public Shares were issued in exchange for an equal number of Class B LP Units in the Partnership.

During the year ended December 31, 2023, 532,473 Telesat Public Shares were issued in exchange for an equal number of Class B LP Units in the Partnership.

During the year ended December 31, 2023, 532,122 RSUs were settled for 271,578 Telesat Public Shares, on a net settlement basis.

During the year ended December 31, 2023, 1,000 options were exercised in exchange for an equal number of Telesat Public Shares.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

SHARE CAPITAL (cont.)

The number and stated value of the outstanding Limited Partnership units (“LP Units”) of Telesat Partnership LP were as follows:

	December 31,<br>2023			December 31,<br>2022
	Number of<br>units	Stated<br>value		Number of<br>units	Stated<br>value
Class A and Class B LP Units	18,321,792	$	50,141	18,854,265	$	51,598
Class C LP Units	18,098,362		38,893	18,098,362		38,893
	36,420,154	$	89,034	36,952,627	$	90,491

The breakdown of the number of Class A and Class B LP units, as at December 31, 2023, was as follows:

Class A and Class B LP Units
Class A LP Units	12,500
Class B LP Units	18,309,292
Total Class A and Class B LP Units	18,321,792

The stated value of Class C LP units as of December 31, 2022, was reduced by an adjustment amount of $20.8 million (US$15.3 million) (Note 26).

On consolidation into the Corporation, the stated value of the LP Units is included under non-controlling interest.

All of the Corporation Shares have equivalent economic rights. The Special Voting Shares and the Golden Share have no material economic rights.

The holders of Class A Common Shares, Class B Variable Voting Shares, Class C Shares, Special Voting Shares and the Golden Share are generally entitled to receive notice of and attend meetings of Telesat Corporation’s shareholders and receive copies of all proxy materials, information statements and other written communications, including from third parties, given in respect of Telesat Public Shares. Holders of Telesat Corporation Shares shall have one vote for each Telesat Corporation Share held at all meetings of the shareholders of Telesat Corporation, except meetings at which only holders of another class or of a particular series shall have the right to vote, provided that holders of Class C Limited Voting Shares will not be entitled to vote on the election of directors of Telesat Corporation. The Telesat Corporation Articles provide that the holders of the Telesat Corporation Shares will vote together as a single class with the Telesat Partnership Units (via the Special Voting Shares), and the Golden Share, with a simple majority of votes required to pass the majority of matters (other than the election of directors of Telesat Corporation, which shall be decided by a plurality of votes cast). Until the occurrence of an Unwind Transaction, a simple majority of votes cast by the holders of Telesat Corporation Shares and Special Voting Shares, voting together as a single class, will be required to approve a Second Tabulation Matter, as defined and described below.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

SHARE CAPITAL (cont.)

The following table summarizes the voting power of the different classes of Telesat Corporation Shares.

Class	Voting for Directors	All Other Votes	Second Tabulation Votes
Class A Common Shares	One vote per share	One vote per share	One vote per share
Class B Variable Voting Shares	One vote per share, provided that any voting power of a single holder in excess of one-third of the outstanding voting power of Telesat Corporation Shares and Telesat Partnership Units (via the Special Voting Shares) and the Golden Share Canadian Votes will effectively be transferred to the Golden Share		One vote per share
Class C Fully Voting Shares	One vote per share	One vote per share	One vote per share
Class C Limited Voting Shares	No votes	One vote per share	One vote per share
Class A Units (voted via the Class A Special Voting Share)	One vote per unit	One vote per unit	One vote per unit
Class B Units (voted via the Class B Special Voting Share)	One vote per unit; provided that any voting power of a single holder in excess of one-third of the outstanding voting power of the Telesat Corporation Shares and Telesat Partnership Units (via the Special Voting Shares) and the Golden Share Canadian Votes will effectively be transferred to the Golden Share		One vote per unit
Class C Units (voted via the Class C Special Voting Share)	Limited votes to ensure compliance with restrictions applicable to PSP Investments pursuant to the constating legislation		One vote per unit
Golden Share	A number of votes equal to the sum of: A number of votes such that the votes cast by the holders of Class A Common Shares and Class A Units, Class C shares and Class C Units, and the Golden Share represent a simple majority of votes cast; and the number of votes transferred from the Class B Variable Voting Shares and Class B Units, if applicable		No votes

Second tabulation matters mean a resolution to effect:

• An increase or decrease of the maximum number of authorized shares of Telesat Corporation shares, or an increase in the maximum number of authorized shares of another class or type with special rights or restrictions equal to superior to the Telesat Corporation shares;

• An exchange, reclassification or cancellation of all or part of Telesat Corporation Shares;

• An addition, change or removal of the special rights or restrictions attached to the Telesat Corporation Shares;

• An increase in the rights or privileges of any class of shares in the capital of Telesat Corporation that has rights or privileges equal or superior to the Telesat Corporation Shares;

• The creation of a new class of Telesat Corporation Shares equal or superior to the Telesat Corporation Shares;

• The making of any class of shares in the capital of Telesat Corporation with rights or privileges inferior to the Telesat Corporation Shares equal or superior to the Telesat Corporation Shares;

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

SHARE CAPITAL (cont.)

• An exchange or creation of a right of exchange of all or part of another class of shares in the capital of Telesat Corporation into Telesat Corporation Shares;

• A constraining of the issuance, transfer or ownership of the Telesat Corporation Shares or a change or removal of such constraint;

• A change to the Telesat Corporation Articles;

• The taking of any step to wind up, dissolve, reorganize or terminate Telesat Corporation;

• A sale, lease, exchange, transfer or other disposition of all or substantially all of Telesat Corporation’s assets;

• The removal of a director of Telesat Corporation from office; or

• The taking of action to effect an amalgamation, merger or other combination of Telesat Corporation with another person or to consolidate, recapitalize or reorganize Telesat Corporation or to continue Telesat Corporation under the laws of another jurisdiction.

26. NON-CONTROLLING INTEREST

Non-controlling interests represent equity interests in the Partnership that are not attributable to the Company. As of December 31, 2023, the Corporation held a general partnership interest representing approximately 27% economic interest in the Partnership (December 31, 2022 — approximately 26%). The remaining 73% economic interest represents exchangeable units held by the limited partnership unit holders (December 31, 2022 — 74%).

Pursuant to the terms of the partnership agreement, Partnership exchangeable units are entitled to distributions from Partnership in an amount equal to any dividends or distributions that are declared and paid with respect to the Telesat Public Shares and Class C Shares of the Company. Additionally, each holder of a Partnership exchangeable unit is entitled to vote in respect of matters on which holders of the Company’s common shares are entitled to vote through a special voting share of the Company. Any time after the one year anniversary of the Transaction’s effective date, the holder of a Partnership exchangeable unit will have the right to require the Partnership to exchange all or any portion of such holder’s Partnership exchangeable units for the Company’s common shares at a ratio of one common share for each Partnership exchangeable unit, subject to the Company’s right as the general partner of the Partnership, in its sole discretion, to deliver a cash payment in lieu of its common shares.

Net income (loss) attributable to non-controlling interests represents the non-controlling interests’ portion of the Partnership’s net income (loss).

During the fourth quarter of 2021, a third-party was engaged to perform a formal valuation of the fair value of the RSUs issued in the second quarter of 2021. The valuation resulted in an increase in compensation and employee benefits of $6.9 million and $9.5 million in the second and third quarter of 2021, respectively, with corresponding decrease of $16.4 million in the fourth quarter of 2021. The decrease in compensation and employee benefits in the fourth quarter of 2021 resulted in higher proportion of net income being attributed to the non-controlling interest.

In connection with the Transaction, a final adjustment amount was required to be made. The adjustment amount is defined within the Transaction agreement and represents any portion of the inducement payment that was unpaid by Loral, combined with the calculated negative net asset value of Loral. During the year ended December 31, 2022, a payment of $20.8 million (US$15.3 million) was made to Red Isle Private Investment Inc. (“Red Isle”) as an adjustment amount, resulting in a reduction in the value of the Class C Partnership Units in the Partnership. Upon consolidation, the reduction in value of the Class C Partnership Units was included in the non-controlling interest.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

27. EARNINGS PER SHARE

Basic earnings per share is calculated by dividing the net income (loss) for the period attributable to shareholders of each class of shares by the weighted average number of shares outstanding during the year.

Diluted earnings per share is calculated to give effect to equity awards.

The following table presents reconciliations of the numerators of the basic and diluted per share computations:

For the years ended December 31,	2023		2022			2021
Net income (loss) attributable to Telesat Corporation Shares	$	157,118	$	(23,764	)	$	92,532
Effect of diluted securities		15,486		—			—
Diluted net income (loss) attributable to Telesat Corporation Shares	$	172,604	$	(23,764	)	$	92,532

The following table presents reconciliations of the denominators of the basic and diluted per share computations:

	2023	2022	2021
Basic total weighted average number of Telesat Public Shares and Class C Shares (Telesat Canada Common Shares) outstanding	13,417,290	12,311,264	45,168,650
Effect of diluted securities
Stock options	51,617	—	422,326
RSUs	1,435,113	—	1,029,519
DSUs	91,587	—	—
PSUs	292,614	—	—
Diluted total weighted average number of Telesat Public Shares and Class C Shares (Telesat Canada Common Shares) outstanding	15,288,221	12,311,264	46,620,495

Effect of diluted securities represents Telesat Public Shares and Class C Shares (Telesat Canada Common Shares) assumed to be issued for no consideration. The difference between the number of Telesat Public Shares and Class C Shares (Telesat Canada Common Shares) assumed issued on exercise and the number of Telesat Public Shares and Class C Shares (Telesat Canada Common Shares) assumed repurchased are treated as an issue of common shares for no consideration.

For the periods prior to the close of the Transaction, for the purposes of earnings per share, the Common Shares, Non-Voting Participating Preferred Shares and Voting Participating Preferred Shares of Telesat Canada have equivalent economic rights. The quantity of shares of Telesat Canada, have been converted to take into account the impact of the conversion which occurred in the Transaction.

For periods after the close of the Transaction, for the purpose of earnings per share, all of the Telesat Public Shares and Class C Shares have equivalent economic rights.

28. GOVERNMENT GRANT

In May 2019, Telesat entered into an agreement for a non-refundable government contribution of a value up to $85 million for a period until December 31, 2024 relating to the Telesat Lightspeed constellation.

For the year ended December 31, 2023, the Company recorded $19.5 million relating to the agreement (December 31, 2022 — $8.8 million).

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

GOVERNMENT GRANT (cont.)

Of the amount recorded during 2023, $15.0 million was recorded as a reduction to satellites, property and other equipment and $4.5 million was recorded as a reduction to operating expenses (2022 — $3.5 million was recorded as a reduction in satellites, property and other equipment, $0.1 million as a reduction to prepaid expenses and $5.2 million as a reduction to operating expenses).

29. CAPITAL DISCLOSURES

The Company’s financial strategy is designed to maintain compliance with the financial covenant under its Senior Secured Credit Facilities (Note 24), and to maximize returns to its shareholders and other stakeholders. The Company meets these objectives through regular monitoring of the financial covenant and operating results on a quarterly basis. The Company’s overall financial strategy remains unchanged from 2022.

The Company defines its capital as Telesat Corporation’s shareholders’ equity (comprising issued share capital, accumulated earnings and excluding reserves), non-controlling interest and debt financing (comprising indebtedness and excluding deferred financing costs, prepayment options and loss on repayment as defined in Note 24).

The Company’s capital was as follows:

As at December 31,	2023		2022
Shareholders’ equity (excluding reserves)	$	585,310	$	402,827
Non-controlling interest	$	1,737,065	$	1,358,716
Debt financing (excluding deferred financing costs, prepayment options and loss on repayment)	$	3,199,247	$	3,853,151

If the Revolving Facility is drawn by more than 35% of the credit facility amount, the Senior Secured Credit Facilities require the Company to comply with a first lien net leverage ratio test. As at December 31, 2023, the first lien net leverage ratio was 4.65:1.00 (December 31, 2022 — 5.30:1.00), which was less than the maximum test ratio of 5.75:1.00.

The Company’s operating results are tracked against budget on a regular basis, and this analysis is reviewed by senior management.

30. FINANCIAL INSTRUMENTS

Measurement of Risks

The Company, through its financial assets and liabilities, is exposed to various risks. The following analysis provides a measurement of risks as at December 31, 2023.

Credit risk

Credit risk is the risk that a counterparty to a financial asset will default, resulting in the Company incurring a financial loss. As at December 31, 2023, the maximum exposure to credit risk is equal to the carrying value of the financial assets which totaled $1,754.6 million (December 31, 2022 — $1,730.0 million).

The following table provides breakdown by maturity of financial assets as at December 31, 2023:

	Carrying<br>amount		Contractual cash flows
		2024			2025			2026			2027			2028			Thereafter
Cash and cash equivalents	$	1,669,089	$	1,669,089		$	—		$	—		$	—		$	—		$	—
Trade and other receivables, excluding deferred receivables		74,942		74,942			—			—			—			—			—
Deferred receivables		8,982		3,347			1,308			1,411			664			549			1,703
Other financial assets		1,629		631			—			—			—			—			998
	$	1,754,642	$	1,748,009		$	1,308		$	1,411		$	664		$	549		$	2,701

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

FINANCIAL INSTRUMENTS (cont.)

Cash and cash equivalents are invested with high quality investment grade financial institutions and are governed by the Company’s corporate investment policy, which aims to reduce credit risk by restricting investments to high-grade, mainly U.S. dollar and Canadian dollar denominated investments.

The Company has credit evaluation, approval and monitoring processes intended to mitigate potential credit risks related to trade accounts receivable. The Company’s standard payment terms are 30 days with interest typically charged on balances remaining unpaid at the end of standard payment terms. The Company’s historical experience with customer defaults has been minimal. As at December 31, 2023, North American and International customers made up 49% and 51% of the outstanding trade receivable balance, respectively (December 31, 2022 — 48% and 52%, respectively). Anticipated bad debt losses have been provided for in the allowance for doubtful accounts. The allowance for doubtful accounts as at December 31, 2023 was $6.5 million (December 31, 2022 — $4.9 million).

The Company mitigates the credit risk associated with derivative instruments by entering into them with only high quality financial institutions.

Foreign exchange risk

The Company’s operating results are subject to fluctuations as a result of exchange rate variations to the extent that transactions are made in currencies other than Canadian dollars. The Company’s main currency exposures lie in its U.S. dollar denominated cash and cash equivalents, trade and other receivables, trade and other payables and indebtedness with the most significant impact being on the U.S. dollar denominated indebtedness, cash and short-term investments. As at December 31, 2023 and 2022, the entire indebtedness was denominated in U.S. dollars, with the Canadian dollar equivalent of the U.S. dollar denominated indebtedness equaling $3,199.2 million and $3,853.2 million, respectively, before netting of deferred financing costs, prepayment options and loss on repayment.

As at December 31, 2023, the impact of a 5 percent increase (decrease) in the value of the Canadian dollar against the U.S. dollar on financial assets and liabilities would have decreased (increased) net income (loss) by $146.4 million (December 31, 2022 — $172.1 million) and increased (decreased) other comprehensive income (loss) by $68.6 million (December 31, 2022 — $57.5 million). This analysis assumes that all other variables, in particular interest rates, remain constant.

Interest rate risk

The Company is exposed to interest rate risk on its cash and cash equivalents and its indebtedness. The interest rate risk on the indebtedness is from a portion of the indebtedness having a variable interest rate. Changes in the interest rates could impact the amount of interest that the Company is required to pay or receive.

In October 2017, the Company entered into four interest rate swaps to hedge the interest rate risk associated with the variable interest rate on US$1,800.0 million of the U.S. denominated Term Loan B at fixed interest rates, excluding applicable margins, ranging from 1.72% to 2.04%. As the final interest rate swap matured in 2022, there were no outstanding interest rate swaps as at December 31, 2023 or 2022.

If the interest rates on the variable rate indebtedness change by 0.25%, the result would be an increase or decrease to net income (loss) of $5.1 million for the year ended December 31, 2023 (December 31, 2022 — $4.3 million).

Liquidity risk

The Company maintains credit facilities to ensure it has sufficient funds available to meet current and foreseeable financial requirements.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

FINANCIAL INSTRUMENTS (cont.)

The contractual maturities of financial liabilities as at December 31, 2023 were as follows:

	Carrying<br>amount		Contractual<br>cash flows<br>(undiscounted)		2024		2025		2026		2027		2028		Thereafter
Trade and other payables	$	43,626	$	43,626	$	43,626	$	—	$	—	$	—	$	—	$	—
Customer and other deposits		1,620		1,620		623		634		50		—		163		150
Satellite performance incentive payments		18,367		22,457		5,549		3,255		3,316		2,533		2,422		5,382
Other financial liabilities		2,389		2,389		2,389		—		—		—		—		—
Indebtedness(1)		3,220,870		3,943,253		249,822		234,839		2,635,564		823,028		—		—
	$	3,286,872	$	4,013,345	$	302,009	$	238,728	$	2,638,930	$	825,561	$	2,585	$	5,532

____________

(1) Indebtedness excludes deferred financing costs, prepayment options and loss on repayment.

The interest payable and interest payments included in the carrying value and contractual cash flows, respectively, in the above table, were as follows:

	Interest<br>payable		Interest<br>payments
Satellite performance incentive payments	$	96	$	4,186
Indebtedness	$	21,623	$	744,006

Financial assets and liabilities recorded on the balance sheets and the fair value hierarchy levels used to calculate those values were as follows:

As at December 31, 2023	Amortized<br>cost			Fair value			Fair value<br>hierarchy
Cash and cash equivalents	$	1,669,089		$	1,669,089		Level 1
Trade and other receivables		78,289			78,289		(1)
Other current financial assets		631			631		Level 1
Other long-term financial assets		6,633			6,633		Level 1
Trade and other payables		(43,626	)		(43,626	)	(1)
Other current financial liabilities		(29,061	)		(29,300	)	Level 2
Other long-term financial liabilities		(14,938	)		(14,388	)	Level 2
Indebtedness(2)		(3,199,247	)		(1,950,811	)	Level 2
	$	(1,532,230	)	$	(283,483	)

As at December 31, 2022	Amortized<br>cost			Fair value			Fair value<br>hierarchy
Cash and cash equivalents	$	1,677,792		$	1,677,792		Level 1
Trade and other receivables		41,248			41,248		(1)
Other current financial assets		515			515		Level 1
Other long-term financial assets		10,476			10,476		Level 1
Trade and other payables		(43,555	)		(43,555	)	(1)
Other current financial liabilities		(48,397	)		(49,500	)	Level 2
Other long-term financial liabilities		(19,663	)		(19,164	)	Level 2
Indebtedness(2)		(3,853,151	)		(1,684,897	)	Level 2
	$	(2,234,735	)	$	(67,085	)

____________

(1) Trade and other receivables and trade and other payables approximate fair value due to the short-term maturity of these instruments.

(2) Indebtedness excludes deferred financing costs, prepayment options and loss on prepayment.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

FINANCIAL INSTRUMENTS (cont.)

Assets pledged as security

The Senior Secured Credit Facilities, Senior Secured Notes and 2026 Senior Secured Notes are secured by substantially all of Telesat’s assets excluding the assets of unrestricted subsidiaries.

Fair Value

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants in the principal market under current market conditions at the measurement date. Where possible, fair values are based on the quoted market values in an active market. In the absence of an active market, the Company determines fair values based on prevailing market rates (bid and ask prices, as appropriate) for instruments with similar characteristics and risk profiles or internal or external valuation models, such as option pricing models and discounted cash flow analysis, using observable market-based inputs.

The fair value hierarchy is as follows:

Level 1 is based on quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company can access at the measurement date.

Level 2 is based on observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially all of the full term of the assets or liabilities.

Level 3 is based on unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose values are determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation.

Estimates of fair values are affected significantly by the assumptions for the amount and timing of estimated future cash flows and discount rates, which all reflect varying degrees of risk. Potential income taxes and other expenses that would be incurred on disposition of these financial instruments are not reflected in the fair values. As a result, the fair values are not necessarily the net amounts that would be realized if these instruments were actually settled.

The carrying amounts of cash and cash equivalents, trade and other receivables, and trade and other payables approximate fair value due to the short-term maturity of these instruments. As at December 31, 2023, cash and cash equivalents included $245.2 million (December 31, 2022 — $8.5 million) of short-term investments.

The fair value of the satellite performance incentive payments, included in other current and long-term financial liabilities, was determined using a discounted cash flow methodology. The calculation is performed on a recurring basis. As at December 31, 2023 and 2022, the discount rate used was 7.4% and 6.6%, respectively.

The fair value of the indebtedness was based on transactions and quotations from third parties considering market interest rates and excluding deferred financing costs, prepayment options and loss on repayment. The calculation of the fair value of the indebtedness is performed on a recurring basis. The rates used were as follows:

As at December 31	2023		2022
U.S. TLB Facility	63.75	%	45.63	%
Senior Unsecured Notes	47.31	%	29.90	%
Senior Secured Notes	59.42	%	45.71	%
2026 Senior Secured Notes	62.38	%	47.02	%

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

FINANCIAL INSTRUMENTS (cont.)

Fair value of derivative financial instruments

Derivatives were valued using a discounted cash flow methodology. The calculations of the fair value of the derivatives are performed on a recurring basis.

Prepayment option cash flows were calculated with a third party option valuation model which is based on the current price of the debt instrument and discounted based on a discount curve.

The discount rates used to discount cash flows as at December 31, 2023 ranged from 4.06% to 5.59% (December 31, 2022 — 4.00% to 5.16%).

31. SHARE-BASED COMPENSATION PLANS

The share-based compensation expense included in the consolidated statements of income (loss) was as follows:

For the years ended December 31,	2023		2022		2021
Operating expenses	$	33,015	$	67,428	$	73,723

Telesat Canada Stock Incentive Plans

Telesat Holdings Inc. (the predecessor entity to Telesat Canada and Telesat Corporation) adopted a management stock incentive plan in September 2008, as amended (the “2008 Telesat Plan”) and a second management stock incentive plan in April 2013, as amended (the “2013 Telesat Plan”). In the first half of 2021, Telesat Canada also adopted a restricted share unit plan (the “RSU Plan” together with the 2008 Telesat Plan and 2013 Telesat Plan, the “Historic Plan”).

The purpose of the Historic Plan was to promote the interests of Telesat and its shareholders by providing certain key employees of Telesat and its affiliates with an appropriate incentive to encourage them to continue in the employ of, or engagement with, Telesat or an affiliate and to improve Telesat’s growth and profitability.

The 2008 Telesat Plan reserved a total of 8,824,646 Telesat Canada Non-Voting Participating Preferred Shares for issuance upon due exercise of Telesat Canada Options. In connection with the completion of the Transaction, no further Telesat Canada Options will be granted under the 2008 Telesat Plan. Prior to the close of the Transaction, 738,667 Telesat Canada stock options were issued and outstanding. Upon the completion of the Transaction the 738,667 Telesat Canada stock options were converted into 305,499 Telesat Corporation stock options.

The 2013 Telesat Plan reserved a total of 8,680,399 Telesat Canada Non-Voting Participating Preferred Shares for issuance upon due exercise of Telesat Canada Options. In connection with the completion of the Transaction, no further Telesat Canada Options will be granted under the 2013 Telesat Plan. Prior to the close of the Transaction, 1,446,797 Telesat Canada stock options were issued and outstanding. Upon the completion of the Transaction the 1,446,797 Telesat Canada stock options were converted into 595,290 Telesat Corporation stock options.

In each case, the Telesat Options were convertible at the option of the holder into Telesat Public Shares (provided that the holder complied with the constrained share provisions in the Telesat Corporation Articles).

Under the stock incentive plans, two different types of stock options could be granted: time-vesting options and performance-vesting options. The time-vesting options generally become vested and exercisable over a five-year period by 20% annual increments. The performance-vesting options become vested and exercisable over a five-year period, provided that the Company has achieved or exceeded an annual or cumulative target consolidated EBITDA established by the Board of Directors. The exercise period of the stock options expires 10 years from the grant date. The exercise price of each share underlying the options was the higher of a fixed price, established by the Board of Directors on the grant date, and the fair market value of a Non-Voting Participating Preferred Share on the grant date. Both plans authorized the Board of Directors to grant tandem SARs, at their discretion.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

SHARE-BASED COMPENSATION PLANS (cont.)

The Company expenses the fair value of stock options that are expected to vest over the vesting period using the Black-Scholes option pricing model. The share-based compensation expense is included in operating expenses.

In April 2021, 6,197,776 issued and outstanding, vested and unvested stock options were cancelled. This resulted in a non-cash operating expense recorded in the year ended December 31, 2021 of $8.5 million.

In April 2021, a total of 3,660,000 Non-Voting Participating Preferred Shares are reserved for issuance upon vesting of the RSUs awarded under the RSU Plan, provided that the aggregate number of Non-Voting Participating Preferred Shares issuable under the RSU Plan (and under all other share compensation arrangements) does not exceed 10% of the total number of Non-Voting Participating Preferred Shares outstanding from time to time (on a non-diluted basis). A total of 3,530,000 Telesat Canada RSUs were issued in connection with the plan. Upon completion of the Transaction the 3,530,000 Telesat Canada RSUs were converted into 1,460,008 Telesat Corporation RSUs.

Telesat Corporation Stock Incentive Plans

In connection with the Transaction, the holders of Telesat Canada Tandem SARs, Telesat Canada Options and Telesat Canada RSUs were offered the opportunity to enter into exchange agreements with Telesat Corporation in respect of their Telesat Canada Tandem SARs, Telesat Canada Options and Telesat Canada RSUs, pursuant to which, upon the Closing, they exchanged such instruments for corresponding instruments in Telesat Corporation. The stock options, share appreciation rights and RSUs will have similar vesting terms, however, the quantity and exercise prices have been adjusted.

On November 19, 2021, Telesat Corporation adopted an omnibus long-term incentive plan (“Omnibus Plan”). The Omnibus Plan allows for a variety of equity-based awards including stock options, RSUs, PSUs and DSUs. The stock options, RSUs, PSUs and DSUs are collectively referred to as “Award”. Each Award will represent the right to receive Public Shares or, in the case of PSUs, RSUs or DSUs, Public Shares or cash, in accordance with the terms of the Omnibus Plan.

The maximum number of Public Shares reserved for issuance under the Omnibus Plan is 2,972,816.

Historic Plan

The change in number of stock options outstanding and their weighted average exercise price for the Historic Plan were summarized below:

	Telesat Corporation<br>time vesting options
	Number of<br>options		Weighted<br>average<br>exercise<br>price
Outstanding at December 31, 2021 and January 1, 2022	900,789		$	48.77
Forfeited	(107,122	)
Outstanding at December 31, 2022	793,667		$	50.30
Exercised	(1,000	)
Expired	(579,459	)
Forfeited	(13,574	)
Outstanding at December 31, 2023	199,634		$	38.76

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

SHARE-BASED COMPENSATION PLANS (cont.)

The quantity of stock options that are exercisable and the weighted average remaining life were as follows:

As at December 31,	2023	2022
Telesat Corporation time vesting options	195,295	782,229
Weighted average remaining life	1 year	1 year

The weighted average assumptions used to determine the share-based compensation expense for stock options using the Black-Scholes option pricing model were as follows:

As at December 31,	2021
Dividend yield	—	%
Expected volatility	35.0	%
Risk-free interest rate	1.85	%
Expected life (years)	10

The expected volatility is based on the historical volatility of comparable publicly listed entities.

There were no stock options granted under the Historic Plan during 2022 or 2023.

The movement in the number of RSUs under the Historic Plan were as follows:

	RSUs with<br>time criteria		RSUs with<br>time and<br>performance<br>criteria
Outstanding, December 31, 2021 and January 1, 2022	1,363,501		124,080
Settled	(390,163	)	—
Outstanding, December 31, 2022 and January 1, 2023	973,338		124,080
Forfeited	(47,564	)	—
Settled	(408,086	)	—
Outstanding, December 31, 2023	517,688		124,080

As at December 31, 2023, there were 103,400 RSUs (December 31, 2022 — 82,720) that were vested but not settled.

Omnibus Plan

The change in number of stock options outstanding and their weighted average exercise price for the Omnibus Plan were summarized below:

	Telesat Corporation<br>time vesting options
	Number of<br>options		Weighted<br>average<br>exercise<br>price
Outstanding at December 31, 2021 and January 1, 2022	—
Granted	285,149
Outstanding at December 31, 2022 and January 1, 2023	285,149		$	16.64
Forfeited	(32,403	)
Granted	550,519
Outstanding at December 31, 2023	803,265		$	13.38

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

SHARE-BASED COMPENSATION PLANS (cont.)

There are no stock options exercisable as of December 31, 2023. The weighted average remaining life is 9 years.

The weighted average assumptions used to determine the share-based compensation expense for stock options using the Black-Scholes option pricing model were as follows:

	2023		2022
Dividend yield	—	%	—	%
Expected volatility	50.0	%	50.0	%
Risk-free interest rate	3.75	%	2.85	%
Expected life (years)	10		10

The expected volatility is based on the historical volatility of comparable publicly listed entities.

The movement in the number of RSUs, PSUs and DSUs under the Omnibus Plan was as follows:

	RSUs with<br>time criteria		PSUs with<br>time and<br>performance<br>criteria		DSUs
Outstanding, December 31, 2021 and January 1, 2022	—		—		—
Granted	382,364		140,583		46,576
Settled	(20,983	)	—		—
Forfeited	(10,310	)	—		—
Outstanding, December 31, 2022 and January 1, 2023	351,071		140,583		46,576
Granted	577,536		281,683		78,040
Settled	(124,036	)	—		—
Forfeited	(19,846	)	(47,129	)	—
Outstanding, December 31, 2023	784,725		375,137		124,616

32. EMPLOYEE BENEFIT PLANS

The Company maintains defined benefit pension plans for Telesat Canada employees (“Canadian Pension Plans”). In October 2013, the Company ceased to allow new employees to join certain defined benefit plans, except under certain circumstances, and commenced a defined contribution pension plan for new employees.

On completion of the Transaction, the Company also took over the defined benefit pension plans for certain former employees of Loral (“US Pension Plans”). Under the US Pension Plans, certain former Loral employees hired prior to July 1, 2006 contributed until November 18, 2021 in order to receive enhanced pension benefits.

Effective January 1, 2024, the Pension Plan for Employees of Telesat Canada and the Pension Plan for Designated Employees of Telesat Canada were merged into one plan, the Pension Plan for Employees of Telesat Canada, subject to final regulatory filings and approvals. The combined plan is closed entirely to new members with respect to the defined benefit provisions. The merged plan offers a defined contribution pension to certain pre-existing and all new employees of Telesat Canada and Telesat LEO Inc.

In addition to the pension plans, the Company provides certain health care and life insurance benefits for some of Telesat Canada’s retired employees and their dependents (“Canadian Other Post-employment Benefit Plans”). Participants are eligible for these benefits generally when they retire from active service and meet the eligibility requirements for the pension plan. These benefits are funded primarily on a pay-as-you-go basis, with the retiree generally paying a portion of the cost through contributions, deductibles and coinsurance provisions.

The Company also provides medical coverage for certain of its retired employees and dependents including certain retired Loral employees (“US Other Post-employment Benefit Plans”). Under the US Other Post-employment Benefit Plans, an annual subsidy is provided to cover for medical benefits to the retired employees and their dependents. For the Loral retired employees, the coverage ends when the retiree reaches age 65.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

EMPLOYEE BENEFIT PLANS (cont.)

The Company’s funding policy is to make contributions to its defined benefit pension funds based on actuarial cost methods as permitted and required by pension regulatory bodies. Contributions reflect actuarial assumptions concerning future investment returns, salary projections and future service benefits. Plan assets are represented primarily by equity securities, fixed income instruments and short-term investments.

The defined benefit plans typically expose the Company to actuarial risks such as investment risk, interest rate risk, longevity risk and salary risk. Investment risk is managed by specifying allowable investment types, setting diversification strategies and determining target asset allocations. The investment objectives of the fund are to optimize the return on investments, taking into account the risks associated with the securities for the protection of the pension benefits of the members of the plan.

As part of the risk management process, for Canadian Plans, the Investment Committee establishes a Statement of Investment Policies and Procedures which includes a diversification strategy and processes to manage foreign currency, credit and other risks. Given the long-term nature of plan liabilities, it is considered appropriate to invest a reasonable portion of the plan assets in equity securities and thus ensure higher return. The Statement of Investment Policies and Procedures is reviewed on an annual basis by the Management Level Pension Fund Investment Committee with approval of the policy being provided by the Audit Committee.

As regards the US Pension Plans, the funding policy is to fund the qualified pension plan in accordance with the Internal Revenue Code and regulations thereon. Plan assets are generally invested in equity, fixed income and other investments. The expected long-term rate of return on pension plan assets is selected by taking into account the expected duration of the plan’s projected benefit obligation, asset mix and the fact that its assets are actively managed to mitigate risk.

A decrease in interest rate will increase the plan liability. However, it will be partially offset by an increase in the return on fixed income instruments. The present value of the plan liabilities is calculated by reference to the best estimates of the mortality and the future salaries of plan participants. Accordingly, an increase in life expectancy or salary will increase the plan liability.

Assets-liability matching strategies are geared towards maintaining an appropriate asset mix to ensure that liquid assets are available to discharge the liabilities as and when they become due. Any potential liquidity issue arising from mismatching of plan assets and benefit obligations is compensated by a broadly diversified investment portfolio, including cash and short-term investments, and cash flows from dividends and interest.

For Canadian Pension Plans, the pension expense for 2023 was determined based on membership data as at December 31, 2021. The accrued benefit obligation as at December 31, 2023 was determined based on the membership data as at December 31, 2022, and extrapolated one year based on December 31, 2023 assumptions. For US Pension Plans, the pension expense for 2023 was determined based on membership data as at December 31, 2022. The accrued benefit obligation as at December 31, 2023 was determined based on the membership data as at December 31, 2022, and extrapolated one year based on December 31, 2023 assumptions.

For Canadian Post-employment Benefit Plans, the expense for 2023 was based on membership and eligibility data as at September 30, 2021 and the accrued benefit obligations as at December 31, 2023 was based on membership data as at September 30, 2021. The accrued benefit obligation for US Post-employment Benefit Plans as at December 31, 2023, related to certain retired Loral employees, was determined based on membership data as at December 31, 2022. For other US Post-employment Benefit Plans, the accrued benefit obligation as at December 31, 2023 was determined based on membership data as at December 31, 2022 and extrapolated, based on December 31, 2023 assumptions.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

EMPLOYEE BENEFIT PLANS (cont.)

The most recent valuation of the pension plans for funding purposes was as of December 31, 2022. Valuations will be performed for the pension plans as of December 31, 2023.

The expenses included on the consolidated statements of income (loss) and the consolidated statements of comprehensive income (loss) were as follows:

For the year ended December 31, 2023	Pension Plans									Other Post-employment<br>Benefit Plans
	Canadian			US			Total			Canadian		US		Total
Consolidated statements of income (loss)
Operating expenses	$	4,524		$	684		$	5,208		$	466	$	—	$	466
Interest expense (income)	$	(2,294	)	$	567		$	(1,727	)	$	927	$	193	$	1,120
Consolidated statements of comprehensive income (loss)
Actuarial (gains) losses on employee benefit plans	$	4,753		$	(1,224	)	$	3,529		$	1,364	$	157	$	1,521

For the year ended December 31, 2022	Pension Plans									Other Post-employment<br>Benefit Plans
	Canadian			US			Total			Canadian			US			Total
Consolidated statements of income (loss)
Operating expenses	$	6,337		$	540		$	6,877		$	710		$	—		$	710
Interest expense	$	(799	)	$	533		$	(266	)	$	731		$	123		$	854
Consolidated statements of comprehensive income (loss)
Actuarial (gains) losses on employee benefit plans	$	(19,560	)	$	(7,348	)	$	(26,908	)	$	(5,346	)	$	(1,028	)	$	(6,374	)

For the year ended December 31, 2021	Pension Plans									Other Post-employment<br>Benefit Plans
	Canadian			US			Total			Canadian		US			Total
Consolidated statements of income (loss)
Operating expenses	$	7,893		$	74		$	7,967		$	166	$	—		$	166
Interest expense	$	743		$	53		$	796		$	552	$	92		$	644
Consolidated statements of comprehensive income (loss)
Actuarial (gains) losses on employee benefit plans	$	(55,582	)	$	(798	)	$	(56,380	)	$	987	$	(29	)	$	958

The Company made contributions of $3.1 million for various defined contribution arrangements during the year ended December 31, 2023 (December 31, 2022 — $2.6 million).

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

EMPLOYEE BENEFIT PLANS (cont.)

The balance sheet obligations, distributed between pension and other post-employment benefits were as follows:

As at December 31,	2023		2022
Included in other long-term liabilities
Pension benefits	$	8,633	$	11,117
Other post-employment benefits		23,719		21,745
Accrued benefit liabilities (Note 23)	$	32,352	$	32,862
Included in other long-term assets
Pension benefits (Note 15)	$	40,624	$	47,312

The amounts recognized in the balance sheets and the funded statuses of the benefit plans were as follows:

	Pension Plans									Other Post-employment<br>Benefit Plans
As at December 31, 2023	Canadian			US			Total			Canadian		US		Total
Present value of funded obligations	$	306,251		$	58,546		$	364,797		$	—	$	—	$	—
Fair value of plan assets		(348,170	)		(49,913	)		(398,083	)		—		—		—
		(41,919	)		8,633			(33,286	)		—		—		—
Present value of unfunded obligations		1,295			—			1,295			19,999		3,720		23,719
(Pension benefits) accrued benefit liabilities	$	(40,624	)	$	8,633		$	(31,991	)	$	19,999	$	3,720	$	23,719

	Pension Plans									Other Post-employment<br>Benefit Plans
As at December 31, 2022	Canadian			US			Total			Canadian		US		Total
Present value of funded obligations	$	275,581		$	58,835		$	334,416		$	—	$	—	$	—
Fair value of plan assets		(324,069	)		(47,718	)		(371,787	)		—		—		—
		(48,488	)		11,117			(37,371	)		—		—		—
Present value of unfunded obligations		1,176			—			1,176			17,888		3,857		21,745
(Pension benefits) accrued benefit liabilities	$	(47,312	)	$	11,117		$	(36,195	)	$	17,888	$	3,857	$	21,745

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

EMPLOYEE BENEFIT PLANS (cont.)

The changes in the benefit obligations and in the fair value of plan assets were as follows:

	Pension Plans									Other Post-employment<br>Benefit Plans
As at December 31, 2023	Canadian			US			Total			Canadian			US			Total
Change in benefits obligations
Benefit obligation, January 1, 2023	$	276,757		$	58,835		$	335,592		$	17,888		$	3,857		$	21,745
Current service cost		4,013			684			4,697			466			—			466
Interest expense		14,172			3,010			17,182			927			193			1,120
Remeasurements
Actuarial gains arising from plan experience		6,341			(353	)		5,988			—			122			122
Actuarial gains from change in demographic assumptions		—			—			—			—			—			—
Actuarial gains from changes in financial assumptions		18,911			1,182			20,093			1,364			35			1,399
Benefits paid		(13,768	)		(3,457	)		(17,225	)		(646	)		(403	)		(1,049	)
Contributions by plan participants		928			—			928			—			—			—
Foreign exchange & other		192			(1,355	)		(1,163	)		—			(84	)		(84	)
Benefit obligation, December 31, 2023		307,546			58,546			366,092			19,999			3,720			23,719
Change in fair value of plan assets
Fair value of plan assets, January 1, 2023		(324,069	)		(47,718	)		(371,787	)		—			—			—
Contributions by plan participants		(928	)		—			(928	)		—			—			—
Contributions by employer (net of transfer to other plans)		(487	)		(2,275	)		(2,762	)		(646	)		(403	)		(1,049	)
Interest income		(16,466	)		(2,443	)		(18,909	)		—			—			—
Benefits paid		13,768			3,457			17,225			646			403			1,049
Remeasurements
Return on plan assets, excluding interest income		(20,499	)		(2,053	)		(22,552	)		—			—			—
Administrative costs		511			—			511			—			—			—
Foreign exchange & other		—			1,119			1,119			—			—			—
Fair value of plan assets, December 31, <br>2023		(348,170	)		(49,913	)		(398,083	)		—			—			—
(Pension benefits) accrued benefit liabilities, December 31, 2023	$	(40,624	)	$	8,633		$	(31,991	)	$	19,999		$	3,720		$	23,719

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

EMPLOYEE BENEFIT PLANS (cont.)

	Pension Plans									Other Post-employment<br>Benefit Plans
As at December 31, 2022	Canadian			US			Total			Canadian			US			Total
Change in benefits obligations
Benefit obligation, January 1, 2022	$	349,635		$	72,906		$	422,541		$	22,429		$	4,865		$	27,294
Current service cost		5,902			540			6,442			710			—			710
Interest expense		11,238			2,108			13,346			731			123			854
Remeasurements
Actuarial gains arising from plan experience		9,258			(123	)		9,135			—			(111	)		(111	)
Actuarial gains from change in demographic assumptions		—			—			—			—			—			—
Actuarial gains from changes in financial assumptions		(86,378	)		(18,751	)		(105,129	)		(5,346	)		(917	)		(6,263	)
Benefits paid		(14,073	)		(3,116	)		(17,189	)		(636	)		(437	)		(1,073	)
Contributions by plan participants		935			—			935			—			—			—
Foreign exchange & other		240			5,271			5,511			—			334			334
Benefit obligation, December 31, 2022		276,757			58,835			335,592			17,888			3,857			21,745
Change in fair value of plan assets
Fair value of plan assets, January 1, 2022		(379,740	)		(54,979	)		(434,719	)		—			—			—
Contributions by plan participants		(935	)		—			(935	)		—			—			—
Contributions by employer		(3,348	)		(1,807	)		(5,155	)		(636	)		(437	)		(1,073	)
Interest income		(12,037	)		(1,575	)		(13,612	)		—			—			—
Benefits paid		14,073			3,116			17,189			636			437			1,073
Remeasurements
Return on plan assets, excluding interest income		57,560			11,526			69,086			—			—			—
Administrative costs		435			—			435			—			—			—
Foreign exchange & other		(77	)		(3,999	)		(4,076	)		—			—			—
Fair value of plan assets, December 31, <br>2022		(324,069	)		(47,718	)		(371,787	)		—			—			—
(Pension benefits) accrued benefit liabilities, December 31, 2022	$	(47,312	)	$	11,117		$	(36,195	)	$	17,888		$	3,857		$	21,745

For the Canadian Pension Plans, the weighted average duration of the defined benefit obligation and weighted average duration of the current service cost as at December 31, 2023 are 12 years and 19 years, respectively. For the Canadian Other Post-employment Benefit Plans, the weighted average duration of the defined benefit obligation and weighted average duration of the current service cost as at December 31, 2023 are 12 years and 21 years, respectively. For the US Pension Plans, the weighted average duration of the defined benefit obligation as at December 31, 2023 is 10 years.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

EMPLOYEE BENEFIT PLANS (cont.)

The estimated future benefit payments for the defined benefit pension plans and other post-employment benefit plans until 2033 are as follows:

	Pension<br>Plans		Other Post-<br>employment<br>Benefit Plans
2024	$	18,207	$	1,177
2025	$	19,284	$	1,310
2026	$	20,244	$	1,333
2027	$	20,985	$	1,418
2028	$	21,615	$	1,473
2029 to 2033	$	113,881	$	7,669

Benefit payments include obligations to 2033 only as obligations beyond this date are not quantifiable.

The fair value of the plan assets were allocated as follows between the various types of investments:

Canadian Pension Plans

As at December 31,	2023		2022
Equity securities
Canada	22.0	%	22.5	%
United States	13.8	%	13.7	%
International (other than United States)	13.6	%	15.5	%
Emerging markets	4.7	%	5.0	%
Fixed income instruments
Canada	43.8	%	40.6	%
Cash and cash equivalents	2.1	%	2.7	%

US Pension Plans

As at December 31,	2023		2022
Equity securities
United States	25.9	%	24.2	%
Canada	1.0	%	—
International	18.7	%	20.6	%
Fixed income instruments
United States	27.4	%	32.2	%
Canada	0.1	%	0.5	%
International	5.2	%	7.1	%
Other investments
United States	14.2	%	10.5	%
Canada	0.4	%	—
International	7.1	%	4.9	%

Plan assets are valued at the measurement date of December 31 each year.

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

EMPLOYEE BENEFIT PLANS (cont.)

The following are the significant assumptions adopted in measuring the Company’s pension and other benefit obligations:

Pension plans

	Canadian				US
As at December 31,	2023		2022		2023		2022
Actuarial benefit obligation
Discount rate	5.15	%	3.20	%	5.10	%	5.30	%
Benefit costs for the year ended
Discount rate	5.20	%	3.40	%	5.30	%	2.85	%
Future salary growth	2.50	%	2.50	%	N/A		N/A

Sensitivity of assumptions

The calculation of the defined benefit obligation is sensitive to the assumptions set out above. The following table summarizes how the impact on the defined benefit obligation as at December 31, 2023 and 2022 would have increased or decreased as a result of the change in the respective assumptions by one percent.

Pension plans

	Canadian						US
As at December 31, 2023	1% increase			1% decrease			1% increase			1% decrease
Discount rate	$	(35,279	)	$	40,962		$	(5,472	)	$	6,504
Future salary growth	$	3,676		$	(5,305	)		N/A			N/A

	Canadian						US
As at December 31, 2022	1% increase			1% decrease			1% increase			1% decrease
Discount rate	$	(30,894	)	$	38,220		$	(5,577	)	$	6,641
Future salary growth	$	4,875		$	(4,024	)		N/A			N/A

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

EMPLOYEE BENEFIT PLANS (cont.)

33. SUPPLEMENTAL CASH FLOW INFORMATION

Cash and cash equivalents were comprised of the following:

As at December 31,	2023		2022		2021
Cash	$	1,423,902	$	1,669,257	$	1,368,559
Short-term investments(1)		245,187		8,535		81,034
Cash and cash equivalents	$	1,669,089	$	1,677,792	$	1,449,593

____________

(1) Consisted of short-term investments with an original maturity of three months or less or which are available on demand with no penalty for early redemption.

Income taxes paid, net of income taxes received was comprised of the following:

For the years ended December 31,	2023			2022			2021
Income taxes paid	$	(67,342	)	$	(98,787	)	$	(94,290	)
Income taxes received		501			644			48
	$	(66,841	)	$	(98,143	)	$	(94,242	)

Interest paid, net of interest received was comprised of the following:

For the years ended December 31,	2023			2022			2021
Interest paid	$	(271,925	)	$	(184,776	)	$	(158,806	)
Interest received		62,664			21,663			4,373
	$	(209,261	)	$	(163,113	)	$	(154,433	)

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

SUPPLEMENTAL CASH FLOW INFORMATION (cont.)

The reconciliation of the liabilities arising from financing activities were as follows:

	Indebtedness			Satellite<br>performance<br>incentive<br>payments			Lease<br>liabilities
Balance as at January 1, 2023	$	3,850,081		$	25,124		$	34,106
Cash outflows		(344,014	)		(6,385	)		(2,171	)
Amortization of deferred financing costs, prepayment options and loss on repayment		1,028			—			—
Gain on repurchase of debt		(230,080	)		—			—
Non-cash additions		—			—			1,473
Interest paid		—			—			(1,523	)
Interest accrued		—			—			1,523
Non-cash disposals		—			—			—
Impact of foreign exchange		(79,996	)		(468	)		(69	)
Balance as at December 31, 2023	$	3,197,019		$	18,271		$	33,339

	Indebtedness			Satellite<br>performance<br>incentive<br>payments			Lease<br>liabilities
Balance as at January 1, 2022	$	3,792,597		$	30,344		$	35,678
Cash outflows		(97,234	)		(6,667	)		(2,498	)
Amortization of deferred financing costs, prepayment options and loss on repayment		842			—			—
Gain on repurchase of debt		(106,916	)		—			—
Non-cash additions		—			—			376
Interest paid		—			—			(1,611	)
Interest accrued		—			—			1,611
Non-cash disposals		—			—			(558	)
Impact of foreign exchange		260,792			1,447			1,108
Balance as at December 31, 2022	$	3,850,081		$	25,124		$	34,106

	Indebtedness			Satellite<br>performance<br>incentive<br>payments			Lease<br>liabilities
Balance as at January 1, 2021	$	3,187,152		$	37,574		$	29,051
Cash outflows		—			(6,914	)		(2,178	)
Cash inflows		619,900			—			—
Debt issue costs		(6,834	)		—			—
Prepayment option at inception – 2026 Senior Secured Notes		1,896			—			—
Amortization of deferred financing costs, prepayment options and loss on repayment		558			—			—
Non-cash additions		—			—			10,074
Interest paid		—			—			(1,499	)
Interest accrued		—			—			1,499
Non-cash disposals		—			—			(939	)
Impact of foreign exchange		(10,075	)		(316	)		(330	)
Balance as at December 31, 2021	$	3,792,597		$	30,344		$	35,678

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Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

SUPPLEMENTAL CASH FLOW INFORMATION (cont.)

The net change in operating assets and liabilities was comprised of the following:

For the years ended December 31,	2023			2022			2021
Trade and other receivables	$	(24,431	)	$	2,298		$	(55,426	)
Financial assets		3,437			4,946			3,206
Other assets		(7,322	)		(6,395	)		(21,017	)
Trade and other payables		(4,085	)		(7,068	)		14,071
Financial liabilities		(639	)		(2,028	)		4,210
Other liabilities		(6,172	)		1,503			(3,669	)
	$	(39,212	)	$	(6,744	)	$	(58,625	)

Non-cash investing activities were comprised of:

For the years ended December 31,	2023			2022		2021
Satellite, property and other equipment	$	(5,921	)	$	3,187	$	10,406
Intangible assets	$	3,204		$	—	$	—
C-band clearing proceeds	$	—		$	—	$	(64,289	)

34. COMMITMENTS AND CONTINGENT LIABILITIES

The following were the Company’s off-balance sheet contractual obligations as at December 31, 2023:

	2024		2025		2026		2027		2028		Thereafter		Total
Property leases	$	1,110	$	1,120	$	1,119	$	980	$	966	$	10,226	$	15,521
Capital commitments		76,938		55,091		5,297		5,959		—		—		143,285
Other operating commitments		31,486		14,076		9,379		8,346		18,749		68,021		150,057
	$	109,534	$	70,287	$	15,795	$	15,285	$	19,715	$	78,247	$	308,863

Property leases consisted of off-balance sheet contractual obligations for land or building usage, while capital commitments included commitments for capital projects. Other operating commitments consisted of third party satellite capacity arrangements as well as other commitments that are not categorized as property leases or capital commitments. The Company’s off-balance sheet obligations included the future minimum payments for the non-cancellable period of each respective obligation, which have various terms and expire between 2024 to 2039.

Certain variable costs associated with the capitalized leases have been included in property leases commitments with a termination date co-terminus with the lease liability.

The Company has entered into contracts for the development of the Telesat Lightspeed constellation and other capital expenditures. The total outstanding commitments as at December 31, 2023 were included in capital commitments.

The Company has agreements with various customers for prepaid revenue on several service agreements which take effect when the satellite is placed in service. The Company is responsible for operating and controlling these satellites. As at December 31, 2023, customer prepayments of $279.4 million (December 31, 2022 — $326.4 million), a portion of which is refundable under certain circumstances, were reflected in other current and long-term liabilities.

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Table of Contents

Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

COMMITMENTS AND CONTINGENT LIABILITIES (cont.)

In the normal course of business, the Company has executed agreements that provide for indemnification and guarantees to counterparties in various transactions. These indemnification undertakings and guarantees may require the Company to compensate the counterparties for costs and losses incurred as a result of certain events including, without limitation, loss or damage to property, change in the interpretation of laws and regulations (including tax legislation), claims that may arise while providing services, or as a result of litigation that may be suffered by the counterparties. The nature of substantially all of the indemnification undertakings prevents the Company from making a reasonable estimate of the maximum potential amount the Company could be required to pay counterparties as the agreements do not specify a maximum amount and the amounts are dependent upon the outcome of future contingent events, the nature and likelihood of which cannot be determined at this time. Historically, the Company has not made any significant payments under such indemnifications.

Telesat Corporation and Telesat CanHold Corporation have entered into an indemnification agreement with PSP Investments where they will indemnify PSP Investments on a grossed-up basis for PSP Investment’s pro rata share of the costs relating to: (a) certain losses and litigation proceedings related to the Transaction, (b) certain losses with regard to Loral and out-of-pocket expenses of Loral and (c) certain tax matters.

In the case of indemnification for certain tax matters only, there will be a cap of US$50 million (other than with respect to defense costs and grossed-up payments) and all other indemnification obligations will be uncapped.

Legal Proceedings

The Company participates from time to time in legal proceedings arising in the normal course of its business.

Telesat previously received assessments from Brazilian tax authorities alleging that additional taxes are owed on revenue earned for the period 2003 to 2018. The total disputed amount for the period 2003 to 2018, including interest and penalties, is now $111.7 million. The disputes relate to the Brazilian tax authorities’ characterization of revenue. The Company has challenged the assessments. The Company believes the likelihood of a favorable outcome in these disputes is more likely than not and, as such, no reserve has been established.

In Canada, the tax authorities previously reassessed $13.1 million relating to transfer pricing issues for the years 2009 to 2014. All disputes relate to Canadian tax authorities’ repricing of certain transactions between Telesat and its subsidiaries. The Company had challenged the reassessments and paid 50% of the outstanding amounts in order to formally object. In late 2023, the Minister of National Revenue rendered a decision in Telesat’s favor and reversed the taxes previously assessed. In March 2024, we received a refund of the taxes paid with interest.

Other than the legal proceedings disclosed above, the Company is not aware of any proceedings outstanding or threatened as of the date hereof by or against it or relating to its business which may have, or have had in the recent past, significant effects on the Company’s financial position or profitability.

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Table of Contents

Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

35. SUBSIDIARIES

The list of significant companies included in the scope of consolidation as at December 31, 2023 and 2022 was as follows:

Company	Country	Method of Consolidation	% voting<br>rights(1)
Infosat Communications LP	Canada	Fully consolidated	100
Telesat Spectrum General Partnership	Canada	Fully consolidated	100
Telesat LEO Holdings Inc.	Canada	Fully consolidated	100
Telesat Technology Corporation	Canada	Fully consolidated	100
Telesat Spectrum Corporation	Canada	Fully consolidated	100
Telesat Spectrum Holdings Corporation	Canada	Fully consolidated	100
Skynet Satellite Corporation	United States	Fully consolidated	100
Telesat Network Services, Inc.	United States	Fully consolidated	100
The SpaceConnection Inc.	United States	Fully consolidated	100
Telesat Satellite LP	United States	Fully consolidated	100
Telesat LEO Inc.	United States	Fully consolidated	100
Telesat U.S. Services, LLC	United States	Fully consolidated	100
Infosat Able Holdings, Inc.	United States	Fully consolidated	100
Telesat Brasil Capacidade de Satélites Ltda.	Brazil	Fully consolidated	100
Telesat (IOM) Limited	Isle of Man	Fully consolidated	100
Telesat International Limited	United Kingdom	Fully consolidated	100
Loral Skynet Corporation	United States	Fully consolidated	100
Loral Space & Communications Inc.	United States	Fully consolidated	100
Telesat Can ULC	Canada	Fully consolidated	100
Telesat CanHold Corporation	Canada	Fully consolidated	100
Telesat Canada	Canada	Fully consolidated	100
Telesat Partnership LP	Canada	Fully consolidated	100

____________

(1) Details of the non-controlling interest are described in Note 26.

36. RELATED PARTY TRANSACTIONS

Transactions with subsidiaries

The Company and its subsidiaries regularly engage in inter-group transactions. These transactions include the purchase and sale of satellite services and communications equipment, providing and receiving network and call centre services, access to orbital slots and management services. The transactions have been entered into over the normal course of operations. Balances and transactions between the Company and its subsidiaries have been eliminated on consolidation and therefore have not been disclosed.

Compensation of executives and Board level directors

For the years ended December 31,	2023		2022		2021
Short-term benefits (including salaries)	$	17,014	$	16,586	$	15,465
Special payments(1)		—		—		597
Post-employment benefits		1,790		2,114		2,514
Share-based payments		31,551		65,314		73,090
	$	50,355	$	84,014	$	91,666

____________

(1) Balance relates to the special cash distribution effective January 25, 2017.

F-68

Table of Contents

Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

RELATED PARTY TRANSACTIONS (cont.)

Key management personnel — stock options

In April 2021, the Company approved the adoption of an RSU plan. A total of 3,660,000 Non-Voting Participating Preferred Shares were reserved for issuance upon vesting of the RSUs awarded under the RSU Plan, provided that the aggregate number of Non-Voting Participating Preferred Shares issuable under the RSU Plan (and under all other share compensation arrangements) did not exceed 10% of the total number of Non-Voting Participating Preferred Shares outstanding from time to time (on a non-diluted basis). A total of 3,530,000 RSUs were issued in connection with the plan. Upon completion of the Transaction the 3,530,000 Telesat Canada RSUs were converted into 1,460,008 Telesat Corporation RSUs.

During the year ended December 2022, 362,590 of the RSUs were settled, on a net settlement basis, in exchange for 186,847 Public shares of Telesat Corporation.

During the year ended December 31, 2023, 408,086 of the RSUs were settled, on a net settlement basis, in exchange for 206,081 Public shares of Telesat Corporation as well as 47,564 RSUs were forfeited. In addition, 517,616 stock options from the Historic Plan expired.

On November 19, 2021, Telesat Corporation adopted the Omnibus Plan. The Omnibus Plan allows for a variety of equity-based awards including stock options, RSUs, PSUs and DSUs.

The following Awards were issued under the Omnibus Plan:

For the years ended December 31,	2023	2022
DSUs issued to certain members of the Board of Directors	78,040	46,576
RSUs to key management personnel, which vest over a three-year period	464,834	230,048
PSUs to key management personnel, which include both a time and performance condition on vesting	281,683	140,583
Stock options to key management personnel	550,519	285,149

Of the Awards that were issued under the Omnibus Plan, the following Awards have been settled.

For the year ended December 31, 2023	Forfeited	Awards<br>Settled	Public<br>Shares<br>issued
DSUs issued to certain members of the Board of Directors	—	—	—
RSUs to key management personnel, which vest over a three-year period(1)	17,426	77,593	39,672
PSUs to key management personnel, which include both a time and performance condition on vesting	47,129	—	—
Stock options to key management personnel	32,403	—	—

____________

(1) RSUs were settled on a net settlement basis

Transactions with related parties

The Company and certain of its subsidiaries regularly engage in transactions with related parties. The Company’s related parties included Loral and Red Isle until November 18, 2021 at which point under the Transaction Agreement Loral became a fully consolidated subsidiary (Note 35). Any transactions entered into with Loral have been entered into over the normal course of operations. Following the Transaction Agreement related parties included Red Isle and MHR. There were no transactions or balances with Red Isle or MHR during any of the years presented.

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Table of Contents

Telesat CorporationNotes to the 2023 Consolidated Financial Statements (all amounts in thousands of Canadian dollars, except where otherwise noted)

RELATED PARTY TRANSACTIONS (cont.)

During the year ended December 31, 2022, $20.8 million (US$15.3 million) was paid to Red Isle in respect of the adjustment amount as per the terms of the Transaction Agreement (Note 26).

Prior to the close of the Transaction, the Company and its subsidiaries entered into the following transactions with Loral.

Sale of goods and services

For the years ended December 31,	2021
Revenue	$	105

Purchase of goods and services

For the years ended December 31,	2021
Operating expenses	$	5,230

The amounts outstanding were unsecured and were settled in cash.

Other related party transactions

The Company funds certain defined benefit pension plans. Contributions made to the plans for the year ended December 31, 2023 were $2.8 million (December 31, 2022 — $5.2 million).

F-70

Exhibit 4.12

ExecutionVersion

AMENDMENTNo. 7, dated as of May 9, 2023 (this “Amendment”), to the Credit Agreement, dated as of March 28, 2012 (as amended by that certain Amendment No. 1 thereto, dated as of April 2, 2013, as further amended by that certain Amendment No. 2 thereto, dated as of November 17, 2016, as further amended by that certain Amendment No. 3 thereto, dated as of December 19, 2016, as further amended by that certain Amendment No. 4 thereto, dated as of February 1, 2017, as further amended by that certain Amendment No. 5 thereto, dated as of April 26, 2018, as further amended by that certain Amendment No. 6 thereto, dated as of December 6, 2019, and as further amended, restated, modified and supplemented from time to time prior to the date hereof, the “Existing Credit Agreement”, and the Existing Credit Agreement as amended by this Amendment, the “Amended Credit Agreement”), by and among TELESAT CANADA (the “Canadian Borrower”), TELESAT LLC (the “U.S. Borrower” and, together with the Canadian Borrower, the “Borrowers” and, each, a “Borrower”), the Guarantors party thereto, the several banks and other financial institutions or entities from time to time party thereto as lenders (each a “Lender” and, collectively, the “Lenders”), JPMORGAN CHASE BANK, N.A., as Administrative Agent (the “Administrative Agent”) and Collateral Agent, and the Swingline Lenders and L/C Issuers from time to time party thereto. Capitalized terms used and not otherwise defined herein shall have the meanings assigned to such terms in the Amended Credit Agreement.

WHEREAS, certain Loans, Commitments and/or other Credit Extensions under the Existing Credit Agreement incur or are permitted to incur interest, fees or other amounts by reference to the LIBO Rate (“LIBOR”) in accordance with the terms of the Existing Credit Agreement; and

WHEREAS, a Benchmark Transition Event (as defined in the Existing Credit Agreement) has occurred and, pursuant to Section 2.15(b) of the Existing Credit Agreement, the Administrative Agent and the Canadian Borrower have agreed, in accordance with the Existing Credit Agreement, that LIBOR should be replaced with a Benchmark Replacement (as defined in the Existing Credit Agreement), and in connection therewith, the Administrative Agent has determined, pursuant to Section 2.15(c) of the Existing Credit Agreement, that certain Benchmark Replacement Conforming Changes are necessary or advisable;

WHEREAS, the Administrative Agent and the Canadian Borrower have agreed that (i) the Adjusted Term SOFR Rate, which includes a SOFR-Based Rate (as defined in the Existing Credit Agreement), shall be the Benchmark Replacement (as defined in the Existing Credit Agreement), and (ii) the Term SOFR Rate shall be the Benchmark under the Amended Credit Agreement and any Loan Document, and such changes shall become effective at and after 5:00 p.m. (New York City time) on the fifth (5th) Business Day after the date that the Administrative Agent has posted a draft of this Amendment to all Lenders and the Canadian Borrower (such date and time, the “Objection Deadline”), so long as the Administrative Agent has not received, by such time, written notice of objection to the Benchmark Replacement Adjustment set forth in this Amendment from Lenders comprising the Required Lenders.

NOW, THEREFORE, in consideration of the premises contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound hereby, agree as follows:

Section

Amendments to Existing Credit Agreement.

(a) The Existing Credit Agreement is, effective as of the Amendment No. 7 Effective Date, hereby amended to delete the stricken text (indicated textually in the same manner as the following example: ~~stricken text~~) and to add the double-underlined text (indicated textually in the same manner as the following example: double-underlined text) as set forth in the pages of the Amended Credit Agreement attached as Exhibit A hereto.

(b) Exhibit B-1 to the Existing Credit Agreement is, effective as of the Amendment No. 7 Effective Date, hereby amended to delete the stricken text (indicated textually in the same manner as the following example: ~~stricken text~~) and to add the double-underlined text (indicated textually in the same manner as the following example: double-underlined text) as set forth in the pages attached as Exhibit B hereto.

Notwithstanding anything set forth in the Existing Credit Agreement or any other Loan Document to the contrary, interest on all Eurodollar Loans (as defined in the Existing Credit Agreement) outstanding as of the Amendment No. 7 Effective Date (the “Existing Eurodollar Loans”) shall continue to accrue interest at the Adjusted LIBO Rate (as defined in the Existing Credit Agreement), be paid in accordance with the terms of the Existing Credit Agreement and remain outstanding under the Amended Credit Agreement as Eurodollar Loans until the expiration of the then-current Interest Period applicable to such Existing Eurodollar Loans (the “Existing Expiration Date”). Any such Existing Eurodollar Loans shall continue to be governed by the relevant provisions of the Existing Credit Agreement applicable to Eurodollar Loans until the earlier of (x) the repayment of such Loans or (y) the effective date of any conversion of such Loans pursuant to the Specified Conversion (as defined below).

In accordance with Section 2.08 of the Amended Credit Agreement, the Canadian Borrower shall, no later than (x) 1:00 p.m. on the third Business Day before the Existing Expiration Date, elect to convert in full the Existing Eurodollar Loans to Term Benchmark Loans or (y) 11:00 a.m. on the Existing Expiration Date, elect to convert in full the Existing Eurodollar Loans to ABR Loans; provided that if the Canadian Borrower fails to give a timely notice requesting such conversion, then the Existing Eurodollar Loans shall be automatically converted to Term Benchmark Loans with a one-month Interest Period effective as of the Existing Expiration Date (the “Specified Conversion”) and from and thereafter, shall be subject solely to the provisions of the Amended Credit Agreement. All accrued and unpaid interest in respect of such Existing Eurodollar Loans shall be due and payable on the Existing Expiration Date.

Section 2. Representations and Warranties, No Default. The Canadian Borrower hereby represents and warrants that as of the Amendment No. 7 Effective Date, after giving effect to this Amendment, (i) no Default or Event of Default has occurred and is continuing and (ii) all representations and warranties made by any Loan Party contained in the Amended Credit Agreement or in the other Loan Documents are true and correct in all material respects with the same effect as though such representations and warranties had been made on and as of the date hereof (except where such representations and warranties expressly relate to an earlier date, in which case such representations and warranties were true and correct in all material respects as of such earlier date); provided that any representation and warranty that is qualified as to “materiality,” “Material Adverse Effect” or similar language shall be true and correct in all respects on the date hereof or on such earlier date, as the case may be (after giving effect to such qualification).

Section 3. Effectiveness. This Amendment shall become effective on the first date (such date, the “Amendment No. 7 Effective Date”) that the following conditions have been satisfied:

(i) Counterparts. The Administrative Agent shall have executed this Amendment and shall have received an executed signature page to this Amendment from the Canadian Borrower;

(ii) Negative Consent. The Administrative Agent shall not have received, prior to the Objection Deadline, written notice of objection to the Benchmark Replacement Adjustment set forth in this Amendment from Lenders comprising the Required Lenders.

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(iii) Expenses. The Canadian Borrower shall have paid all reasonable and documented expenses for which invoices have been presented prior to the Amendment No. 7 Effective Date (including reasonable fees, charges and disbursements of Cahill Gordon & Reindel LLP, counsel to the Administrative Agent);

Section 4. Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto on separate counterparts, each of which when so executed and delivered shall be deemed to be an original, but all of which when taken together shall constitute a single instrument. Delivery of an executed counterpart of a signature page of this Amendment by facsimile or any other electronic transmission shall be effective as delivery of a manually executed counterpart hereof.

Section 5. Applicable Law. THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

Section 6. Waiver of Jury Trial. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AMENDMENT. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AMENDMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 6.

Section 7. Jurisdiction; Consent to Service of Process. Each party hereto hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of any New York State court or federal court of the United States of America sitting in New York City, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Amendment, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Each party hereto hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Amendment in any New York State or federal court. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

Section 8. Headings. The headings of this Amendment are for purposes of reference only and shall not limit or otherwise affect the meaning hereof.

Section 9. Effect of Amendment. Except as expressly set forth herein, (i) this Amendment shall not by implication or otherwise limit, impair, constitute a waiver of or otherwise affect the rights and remedies of the Lenders, the Administrative Agent or any other Secured Party, in each case under the Existing Credit Agreement or any other Loan Document, and (ii) shall not alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Existing Credit Agreement or any other Loan Document and nothing herein shall or may be construed as a novation thereof. Except as expressly set forth herein, each and every term, condition, obligation, covenant and agreement contained in the Existing Credit Agreement or any other Loan Document is hereby

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ratified and re-affirmed in all respects and shall continue in full force and effect and the Canadian Borrower on behalf of each Loan Party reaffirms the obligations of each Loan Party under each Loan Document to which such Loan Party is party and the grant of such Loan Party’s Liens on the Collateral made by it pursuant to the Security Documents. From and after the Amendment No. 7 Effective Date, all references to the “Credit Agreement” in any Loan Document and all references in the Amended Credit Agreement to “this Agreement,” “hereunder,” “hereof” or words of like import referring to the Amended Credit Agreement shall, unless expressly provided otherwise, refer to the Existing Credit Agreement as amended by this Amendment. The Canadian Borrower hereby consents to this Amendment and confirms on behalf of each Loan Party that all obligations of each Loan Party under the Loan Documents to which such Loan Party is a party shall continue to apply to the Existing Credit Agreement as amended hereby and that the amendment of the Existing Credit Agreement pursuant to this Amendment shall not constitute a novation of the Existing Credit Agreement or any other Loan Document as in effect prior to the Amendment No. 7 Effective Date.

[SIGNATURE PAGES FOLLOW]

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

TELESAT CANADA
By:	/s/ Christopher DiFrancesco
	Name:	Christopher DiFrancesco
	Title:	Vice President, General Counsel and Secretary

[Telesat Amendment No. 7]

JPMorgan Chase Bank, N.A.,
as Administrative Agent
By:	/s/ Melanie George
	Name:	Melanie George
	Title:	Vice President

[Telesat Amendment No. 7]

Exhibit A

[Attached]

CREDIT AGREEMENT

Dated as of March 28, 2012,

as Amended by Amendment No. 1 on April 2, 2013,

as further Amended by Amendment No. 2 on November 17, 2016,

as further Amended by Amendment No. 3 on December 19, 2016,

as further Amended by Amendment No. 4 on February 1, 2017,

as further Amended by Amendment No. 5 on April 26, 2018, ~~and~~

as further Amended by Amendment No. 6 on December 6, 2019 and

as further Amended by Amendment No. 7 on May 9, 2023

among

TELESAT CANADA,

as Canadian Borrower

TELESAT LLC,

as U.S. Borrower

THE GUARANTORS PARTY HERETO

THE LENDERS PARTY HERETO

and

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent, Collateral Agent, Swingline Lender and L/C Issuer

JPMORGAN CHASE BANK, N.A.

and

GOLDMAN SACHS BANK USA,

as Joint Lead Arrangers and Joint Book Runners for the Term B-5 Loan Facility

GOLDMAN SACHS BANK USA,

as Syndication Agent for the Revolving R-3 Facility

and

GOLDMAN SACHS BANK USA,

JPMORGAN CHASE BANK, N.A.,

BMO CAPITAL MARKETS,

CANADIAN IMPERIAL BANK OF COMMERCE,

CREDIT SUISSE LOAN FUNDING LLC,

MORGAN STANLEY SENIOR FUNDING, INC.,

RBC CAPITAL MARKETS,

ING BANK N.V.,

THE BANK OF NOVA SCOTIA

and

TD SECURITIES,

as Joint Lead Arrangers and Joint Book Runners for the Revolving R-3 Facility

TABLE OF CONTENTS

		Page
ARTICLE I DEFINITIONS		1
SECTION 1.01	Defined Terms	1
SECTION 1.02	Terms Generally	73
SECTION 1.03	Exchange Rates	~~73~~74
SECTION 1.04	Effectuation of Transactions	~~74~~75
SECTION 1.05	Divisions	~~74~~75
SECTION 1.06	Limited Condition Transactions	~~74~~75
SECTION 1.07	Pro Forma and Other Calculations	~~75~~76
SECTION 1.08	Interest Rates; ~~LIBOR~~Benchmark Notification	~~77~~78
ARTICLE II THE CREDITS		78
SECTION 2.01	Commitments	78
SECTION 2.02	Notice to Lenders; Funding of Loans	78
SECTION 2.03	Requests for Borrowings	79
SECTION 2.04	Swingline Loans	80
SECTION 2.05	Letters of Credit	~~81~~82
SECTION 2.06	BAs	~~89~~90
SECTION 2.07	Funding of Borrowings	~~91~~92
SECTION 2.08	Interest Elections	92
SECTION 2.09	Termination and Reduction of Commitments	93
SECTION 2.10	Repayment of Loans; Evidence of Debt, etc.	~~94~~95
SECTION 2.11	Repayment of Loans	~~95~~96
SECTION 2.12	Prepayments, etc.	97
SECTION 2.13	Fees	106
SECTION 2.14	Interest	107
SECTION 2.15	Alternate Rate of Interest	108
SECTION 2.16	Increased Costs	~~109~~110
SECTION 2.17	Break Funding Payments	~~110~~111
SECTION 2.18	Taxes	111
SECTION 2.19	Payments Generally; Pro Rata Treatment; Sharing of Payments	113
SECTION 2.20	Mitigation Obligations; Replacement of Lenders	~~114~~115
SECTION 2.21	Incremental Facilities	~~115~~116
SECTION 2.22	Illegality	~~118~~119
SECTION 2.23	Defaulting Lenders	119
SECTION 2.24	Amendments Effecting a Maturity Extension	~~120~~121
ARTICLE III REPRESENTATIONS AND WARRANTIES		~~124~~125
SECTION 3.01	Organization; Powers	~~124~~125
SECTION 3.02	Authorization	~~124~~125
SECTION 3.03	Enforceability	~~124~~125
SECTION 3.04	Governmental Approvals	~~124~~125
SECTION 3.05	Financial Statements	~~125~~126
SECTION 3.06	No Material Adverse Effect	~~125~~126
SECTION 3.07	Title to Properties; Possession Under Leases; Casualty Proceeds	~~125~~126
SECTION 3.08	Subsidiaries	~~126~~127
SECTION 3.09	Litigation; Compliance with Laws	~~126~~127
SECTION 3.10	Federal Reserve Regulations	~~126~~127
SECTION 3.11	Investment Company Act	~~126~~127

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		Page
SECTION 3.12	Use of Proceeds	127
SECTION 3.13	Tax Returns	~~127~~128
SECTION 3.14	No Material Misstatements	~~127~~128
SECTION 3.15	Employee Benefit Plans	~~127~~128
SECTION 3.16	Environmental Matters	~~128~~129
SECTION 3.17	Security Documents	~~128~~129
SECTION 3.18	Location of Real Property	~~129~~130
SECTION 3.19	Solvency	~~129~~130
SECTION 3.20	Labor Matters	~~129~~130
SECTION 3.21	Foreign Assets Control Regulations, Anti-Terrorism Laws and Anti-Money Laundering Laws and the Patriot Act	130
SECTION 3.22	FCC Licenses, etc.	~~130~~131
SECTION 3.23	Satellites	131
ARTICLE IV CONDITIONS OF LENDING		~~131~~132
SECTION 4.01	All Credit Events	~~131~~132
SECTION 4.02	First Credit Event	~~131~~132
ARTICLE V AFFIRMATIVE COVENANTS		~~131~~132
SECTION 5.01	Existence; Businesses and Properties	132
SECTION 5.02	Insurance	~~132~~133
SECTION 5.03	Taxes	~~134~~135
SECTION 5.04	Financial Statements, Reports, etc. Furnish to the Administrative Agent (which will promptly furnish such information to the Lenders):	~~134~~135
SECTION 5.05	Litigation and Other Notices	~~136~~137
SECTION 5.06	Compliance with Laws	~~136~~137
SECTION 5.07	Maintaining Records; Access to Properties and Inspections	~~136~~137
SECTION 5.08	Use of Proceeds	~~137~~138
SECTION 5.09	Compliance with Environmental Laws	~~137~~138
SECTION 5.10	Further Assurances; Additional Mortgages	~~137~~138
ARTICLE VI NEGATIVE COVENANTS		~~140~~141
SECTION 6.01	Limitation on Incurrence of Indebtedness	141
SECTION 6.02	Limitation on Liens	~~146~~147
SECTION 6.03	Merger, Consolidation or Sale of All or Substantially All Assets	~~146~~147
SECTION 6.04	Limitation on Sale of Assets	~~148~~149
SECTION 6.05	[Reserved].	~~149~~150
SECTION 6.06	Limitation on Restricted Payments	~~149~~150
SECTION 6.07	[Reserved]	~~154~~155
SECTION 6.08	[Reserved]	~~154~~155
SECTION 6.09	First Lien Leverage Ratio	~~154~~155
SECTION 6.10	Limitation on Guarantees of Indebtedness by Restricted Subsidiaries	~~154~~155
SECTION 6.11	[Reserved]	155
SECTION 6.12	Limitations on Transactions with Affiliates	~~155~~156
SECTION 6.13	Limitation on Activities of the U.S. Borrower	~~157~~158
SECTION 6.14	Limitations on Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries	~~157~~158
SECTION 6.15	Fiscal Year	~~158~~159
SECTION 6.16	Changes in Business	~~158~~159

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		Page
ARTICLE VII EVENTS OF DEFAULT		159
SECTION 7.01	Events of Default	159
SECTION 7.02	Right to Cure	~~161~~162
ARTICLE VIII THE AGENTS		162
SECTION 8.01	Appointment and Authorization of the Agents	162
SECTION 8.02	Delegation of Duties	164
SECTION 8.03	Exculpatory Provisions	164
SECTION 8.04	Reliance on Communications	~~164~~165
SECTION 8.05	Notice of Default	165
SECTION 8.06	Credit Decision; Disclosure of Information by Administrative Agent; No Reliance on Arrangers’ or Agents’ Customer Identification Program	165
SECTION 8.07	Indemnification	~~165~~166
SECTION 8.08	Agents in Their Individual Capacity	166
SECTION 8.09	Successor Agents	~~166~~167
SECTION 8.10	Administrative Agent May File Proofs of Claim	~~167~~168
SECTION 8.11	Collateral and Guaranty Matters	168
SECTION 8.12	Other Agents; Arrangers and Managers	169
SECTION 8.13	Certain ERISA Matters	169
ARTICLE IX MISCELLANEOUS		170
SECTION 9.01	Notices	170
SECTION 9.02	Survival of Agreement	~~170~~171
SECTION 9.03	Binding Effect	171
SECTION 9.04	Successors and Assigns	171
SECTION 9.05	Expenses; Indemnity	176
SECTION 9.06	Right of Set-off	~~177~~178
SECTION 9.07	Applicable Law	~~177~~178
SECTION 9.08	Waivers; Amendment	~~177~~178
SECTION 9.09	Interest Rate Limitation	181
SECTION 9.10	Entire Agreement	181
SECTION 9.11	WAIVER OF JURY TRIAL	~~181~~182
SECTION 9.12	Severability	~~181~~182
SECTION 9.13	Counterparts	~~181~~182
SECTION 9.14	Headings	~~181~~182
SECTION 9.15	Jurisdiction; Consent to Service of Process	182
SECTION 9.16	Confidentiality	~~182~~183
SECTION 9.17	Conversion of Currencies	183
SECTION 9.18	Release of Liens and Guarantees	183
SECTION 9.19	Patriot Act	~~184~~185
SECTION 9.20	Regulatory Matters	~~184~~185
SECTION 9.21	Application of Proceeds	~~185~~186
SECTION 9.22	Withholding Tax	187
SECTION 9.23	Intercreditor Agreement Authorization	~~187~~188
SECTION 9.24	Obligations of the Borrowers Joint and Several	~~187~~188
SECTION 9.25	Acknowledgement and Consent to Bail-In of EEA Financial Institutions	~~187~~188
SECTION 9.26	Acknowledgement Regarding Any Supported QFCs	188
ARTICLE X GUARANTEE		~~188~~189
SECTION 10.01	The Guarantee	~~188~~189

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		Page
SECTION 10.02	Obligations Unconditional	189
SECTION 10.03	Reinstatement	190
SECTION 10.04	Subrogation; Subordination	190
SECTION 10.05	Remedies	190
SECTION 10.06	Instrument for the Payment of Money	190
SECTION 10.07	Continuing Guarantee	~~190~~191
SECTION 10.08	General Limitation on Guarantee Obligations	~~190~~191
SECTION 10.09	Release of Guarantors	~~190~~191
SECTION 10.10	Brazilian Guarantors	191

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Exhibits and Schedules

Exhibit A	Form of Assignment and Acceptance
Exhibit B-1	Form of Borrowing Request
Exhibit B-2	Form of Letter of Credit Request
Exhibit C	Form of Swingline Borrowing Request
Exhibit D-1	[Reserved]
Exhibit D-2	Form of Canadian Security Agreement
Exhibit E-1	Form of Term Note
Exhibit E-2	Form of Revolving Note
Exhibit E-3	Form of Swingline Note
Exhibit F	Form of Intercompany Note
Exhibit G	[Reserved]
Exhibit H	Form of Deed of Hypothec
Exhibit I	Form of Administrative Questionnaire
Exhibit J	Form of Subsidiary Joinder Agreement
Exhibit K	Form of U.S. Mortgage
Exhibit L	[Reserved]
Exhibit M-1	Form of Equal Priority Intercreditor Agreement
Exhibit M-2	Form of Junior Priority Intercreditor Agreement
Exhibit N-1	Form of Acceptance and Prepayment Notice
Exhibit N-2	Form of Discount Range Prepayment Notice
Exhibit N-3	Form of Discount Range Prepayment Offer
Exhibit N-4	Form of Solicited Discounted Prepayment Notice
Exhibit N-5	Form of Solicited Discounted Prepayment Offer
Exhibit N-6	Form of Specified Discount Prepayment Notice
Exhibit N-7	Form of Specified Discount Prepayment Response
Exhibit O	[Reserved]
Exhibit P	[Reserved]
Exhibit Q	Form of Affiliated Lender Assignment and Acceptance
Schedule 1.01(a)	Collateral and Guarantee Requirements
Schedule 1.01(b)	Agreed Security Principles: Regulatory Provisions for Security Documents
Schedule 1.01(c)	Mortgaged Properties
Schedule 2.01	Commitments
Schedule 2.04	Swingline Commitments
Schedule 2.05	Existing Letters of Credit
Schedule 3.01	Organization
Schedule 3.04	Governmental Approvals
Schedule 3.07	Title to Properties; Possession Under Leases
Schedule 3.08(a)	Amendment No. 2 Effective Date Structure
Schedule 3.08(b)	Subsidiaries
Schedule 3.08(c)	Subscriptions
Schedule 3.09	Litigation
Schedule 3.13	Taxes
Schedule 3.18(a)	Owned Material Real Property
Schedule 3.18(b)	Ground Leased Material Real Property
Schedule 3.20	Labor Matters
Schedule 3.22	Satellite Licenses
Schedule 3.23	Satellites
Schedule 5.04	Canadian Borrower’s Website
Schedule 5.10(e)	Certain Subsidiaries and Property
Schedule 6.01	Indebtedness
Schedule 6.02	Liens
Schedule 6.04	Dispositions
Schedule 6.06	Investments

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Schedule 6.12	Affiliate Transactions
Schedule 9.01	Administrative Agent’s Office, Certain Addresses for Notices

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CREDIT AGREEMENT dated as of March 28, 2012 (as amended by Amendment No. 1 on April 2, 2013, Amendment No. 2 on November 17, 2016, Amendment No. 3 on December 19, 2016, Amendment No. 4 on February 1, 2017 ~~and~~, Amendment No. 5 on April 26, 2018, Amendment No. 6 on December 6, 2019 and Amendment No. 7 on May 9, 2023) (this “Agreement”), among TELESAT CANADA, a Canada corporation (the “Canadian Borrower”; as hereinafter further defined), TELESAT LLC, a Delaware limited liability company and a wholly owned subsidiary of the Canadian Borrower (the “U.S. Borrower”; as hereinafter further defined), certain subsidiaries of the Canadian Borrower as Guarantors, the LENDERS party hereto from time to time, JPMORGAN CHASE BANK, N.A. (“JPMCB”), as administrative agent (in such capacity, the “Administrative Agent”; as hereinafter further defined), as collateral agent for the Secured Parties (in such capacity, the “Collateral Agent”; as hereinafter further defined) and as an L/C Issuer.

W I T N E S S E T H :

WHEREAS, the Canadian Borrower has requested that (a) the Term B-5 Lenders make Term B-5 Loans in an aggregate principal amount of $1,908,500,000 and (b) from time to time, the Revolving R-3 Facility Lenders lend to the Canadian Borrower and the L/C Issuers issue Letters of Credit for the account of the Canadian Borrower and its Restricted Subsidiaries under a $200,000,000 Revolving R-3 Facility.

NOW, THEREFORE, the Lenders are willing to extend senior secured credit to the Borrowers on the terms and subject to the conditions set forth herein. Accordingly, the parties hereto agree as follows:

ARTICLE I

DEFINITIONS

Section 1.01 Defined Terms. As used in this Agreement, the following terms shall have the meanings specified below:

“ABR Borrowing” shall mean a Borrowing comprised of ABR Loans.

“ABR Loan” shall mean any ABR Term Loan, ABR Revolving Loan or Swingline Loan.

“ABR Revolving Borrowing” shall mean a Borrowing comprised of ABR Revolving Loans.

“ABR Revolving Loan” shall mean any Revolving R-3 Facility Loan bearing interest at a rate determined by reference to the Alternate Base Rate in accordance with the provisions of Article II.

“ABR Term Loan” shall mean any Term Loan bearing interest at a rate determined by reference to the Alternate Base Rate in accordance with the provisions of Article II.

“Acceptable Discount” shall have the meaning given to it in Section 2.12(f)(iv)(B).

“Acceptable Prepayment Amount” shall have the meaning given to it in Section 2.12(f)(iv)(C).

“Acceptance and Prepayment Notice” shall mean a notice of the Borrower’s acceptance of the Acceptable Discount in substantially the form of Exhibit N-1.

“Acceptance Date” shall have the meaning given to it in Section 2.12(f)(iv)(B).

“Acceptance Fees” shall have the meaning assigned to such term in Section 2.13(c).

“Acquired EBITDA” shall mean, with respect to any Acquired Entity or Business or any Converted Restricted Subsidiary (any of the foregoing, a “Pro Forma Entity”) for any period, the amount for such period of Consolidated EBITDA of such Pro Forma Entity (determined using such definitions as if references to the Canadian

Borrower and its Subsidiaries therein were to such Pro Forma Entity and its Subsidiaries), all as determined on a consolidated basis for such Pro Forma Entity in accordance with GAAP.

“Acquired Entity or Business” shall have the meaning provided in the definition of the term “Consolidated EBITDA.”

“Acquired Indebtedness” means, with respect to any specified Person,

(1) Indebtedness of any other Person existing at the time such other Person is merged with or into or became a Restricted Subsidiary of such specified Person, including Indebtedness incurred in connection with, or in contemplation of, such other Person merging with or into or becoming a Restricted Subsidiary of such specified Person, and

(2) Indebtedness secured by a Lien encumbering any asset acquired by such specified Person.

“Additional Lender” shall have the meaning assigned to such term in Section 2.21(d).

“Additional Mortgage” shall have the meaning assigned to such term in Section 5.10(b).

“Adjusted ~~LIBORate~~Daily Simple SOFR” shall mean~~,with respect to any Eurodollar Borrowing for any Interest Period,~~ an interest rate per annum ~~(roundedupwards, if necessary,~~equal to (a) the Daily Simple SOFR, plus (b) 0.11448% (11.448 basis points); provided that if the Adjusted Daily Simple SOFR as so determined would be less than the Floor, such rate shall be deemed to be equal to the ~~next 1/100 of 1%)~~Floor for the purposes of this Agreement.

“Adjusted Term SOFR Rate” shall mean, for any Interest Period, an interest rate per annum equal to ~~the result of dividing~~ (a) the ~~LIBO~~Term SOFR Rate ~~in effect~~ for such Interest Period ~~by~~, plus (b) ~~1.00~~ ~~minus~~ ~~the Statutory Reserves applicableto such Eurodollar Borrowing, if any~~0.11448% (11.448 basis points) for an Interest Period of one month’s duration, 0.26161% (26.161 basis points) for an Interest Period of three month’s duration and 0.42826% (42.826 basis points) for an Interest Period of six month’s duration; provided that ~~inno event shall~~if the Adjusted ~~LIBO~~Term SOFR Rate as so determined would be less than ~~0.00%~~the Floor, such rate shall be deemed to be equal to the Floor for the purposes of this Agreement.

“Administrative Agent” shall mean JPMCB or any successor to JPMCB appointed in accordance with the provisions of Section 8.09, together with any Persons that are appointed as sub-agents in accordance with Section 8.02, in each case, as the administrative agent for the Lenders under this Agreement and the other Loan Documents.

“Administrative Agent’s Office” shall mean the Administrative Agent’s address and, as appropriate, account as set forth on Schedule 9.01, or such other address or account as the Administrative Agent may from time to time notify the Canadian Borrower and the Lenders.

“Administrative Questionnaire” means an Administrative Questionnaire substantially in the form of Exhibit I or such other form as shall be reasonably acceptable to the Administrative Agent.

“Affiliate” shall mean, when used with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the person specified.

“Affiliate Transaction” shall have the meaning provided in Section 6.12.

“Affiliated Lender” shall mean a Non-Debt Fund Affiliate or a Debt Fund Affiliate.

“Affiliated Lender Assignment and Acceptance” shall have the meaning provided in Section 9.04(e)(i)(C).

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“Agent Fees” shall have the meaning assigned to such term in Section 2.13(e).

“Agent-Related Persons” shall mean the Administrative Agent and the Collateral Agent, together with their respective Affiliates (including, in the case of JPMCB in its capacity as the Administrative Agent, J.P. Morgan), and the officers, directors, employees, agents and attorneys-in-fact of such Persons and Affiliates.

“Agents” shall mean the Administrative Agent and the Collateral Agent.

“Agreed Security Principles” shall mean:

(i) No Lien or provision of a guarantee by any Person organized outside the United States or Canada shall be made that would:

(a) result in any breach of corporate benefit, financial assistance, capital preservation, fraudulent preference, thin capitalization rules, retention of title claims or any other law or regulation (or analogous restriction) of the jurisdiction of organization of such Person;

(b) result in any risk to the officers or directors of such Person of a civil or criminal liability; or

(c) result in a Lien being granted over assets, the acquisition of which was financed from a subsidy of payments, the terms of which prohibit any assets acquired with such subsidy or payment being used as collateral; provided the Administrative Agent consents to such exclusion (such consent not to be unreasonably withheld).

(ii) It is expressly acknowledged that in certain jurisdictions (a) it may be impossible or impractical (including for legal and regulatory reasons) to grant guarantees or create security over certain categories of assets in which event such guarantees will not be granted and security will not be taken over such assets or (b) it may take longer than agreed to grant guarantees or create security over certain categories of assets, in which event the Collateral Agent will act reasonably in granting the necessary extension of timing for obtaining such guarantees or security; provided that, in each case with respect to subclauses (a) and (b), the relevant Guarantor has exercised due diligence and reasonable efforts in providing such guarantees or security.

(iii) It is expressly acknowledged that the form of the Security Documents may vary from the forms attached to the Credit Agreement or Security Documents in order to conform to local requirements and customs as well as potential impracticality of complying with local requirements in respect of every item of collateral.

(iv) Each Security Document relating to assets or stock of a United States or Canadian telecommunications carrier (as defined in the Telecommunications Act (Canada)) will contain provisions substantially in accordance with Schedule 1.01(b) hereto and shall be deemed to include such provisions whether or not actually included.

“Agreement” shall have the meaning assigned to such term in the introductory paragraph of this Agreement.

“Agreement Currency” shall have the meaning assigned to such term in Section 9.17(b).

“Alternate Base Rate” shall mean, for any day, a rate per annum equal to (x) in the case of Term B-5 Loans or Revolving R-3 Facility Loans denominated in Dollars, the greatest of (a) the Prime Rate, (b) the Federal Funds Effective Rate in effect on such day plus 1/2 of 1% and (c) the ~~LIBO~~Adjusted Term SOFR Rate for a one-month Interest Period ~~determined on~~as published two U.S. Government Securities Business Days prior to such day (or if such day is not a U.S. Government Securities Business Day, the immediately preceding U.S. Government Securities Business Day) plus 1.00%; provided that for the purpose of this definition, the Adjusted Term SOFR Rate for any day shall be based on the Term SOFR Reference Rate at approximately 5:00 a.m. Chicago time on such day (or any

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amended publication time for the Term SOFR Reference Rate, as specified by the CME Term SOFR Administrator in the Term SOFR Reference Rate methodology) or (y) in the case of any other Loans, the Canadian Prime Rate. If for any reason the Administrative Agent shall have determined (which determination shall be conclusive absent manifest error) that it is unable to ascertain the Federal Funds Effective Rate, including the failure of the Federal Reserve Bank of New York to publish rates or the inability of the Administrative Agent to obtain quotations in accordance with the terms thereof, the Alternate Base Rate shall be determined without regard to clause (x)(b) of the preceding sentence until the circumstances giving rise to such inability no longer exist. If the Alternate Base Rate is being used as an alternate rate of interest pursuant to Section 2.15 (for the avoidance of doubt, only until the Benchmark Replacement has been determined pursuant to Section 2.15(b)), then the Alternate Base Rate shall be the greater of clauses (a) and (b) above and shall be determined without reference to clause (c) above. Any change in the Alternate Base Rate due to a change in the Prime Rate, the Canadian Prime Rate, the Federal Funds Effective Rate or the ~~LIBO~~Adjusted Term SOFR Rate shall be effective on the effective date of such change in the Prime Rate, the Canadian Prime Rate, the Federal Funds Effective Rate or the ~~LIBO~~Adjusted Term SOFR Rate, respectively.

“Amendment No. 1” shall mean Amendment No. 1, dated as of April 2, 2013, to this Agreement.

“Amendment No. 2” shall mean Amendment No. 2, dated as of November 17, 2016, to this Agreement.

“Amendment No. 2 Effective Date” shall mean November 17, 2016.

“Amendment No. 3” shall mean Amendment No. 3, dated as of December 19, 2016, to this Agreement.

“Amendment No. 4” shall mean Amendment No. 4, dated as of February 1, 2017, to this Agreement.

“Amendment No. 4 Effective Date” shall mean February 1, 2017.

“Amendment No. 5” shall mean Amendment No. 5, dated as of April 26, 2018, to this Agreement.

“Amendment No. 5 Effective Date” shall mean April 26, 2018.

“Amendment No. 6” shall mean Amendment No. 6, dated as of December 6, 2019, to this Agreement.

“Amendment No. 6 Effective Date” shall mean December 6, 2019.

“Amendment No. 7” shall mean Amendment No. 7, dated as of May 9, 2023, to this Agreement.

“Amendment No. 7 Effective Date” shall mean May 9, 2023.

“Ancillary Agreement” means the Ancillary Agreement, dated as of August 7, 2007, among Loral, Skynet, PSP and the Canadian Borrower, as amended.

“Anti-Corruption Laws” means all laws, rules, and regulations of any jurisdiction applicable to the Borrower or any of its Subsidiaries from time to time concerning or relating to bribery or corruption.

“Anti-Terrorism Laws and Anti-Money Laundering Laws” shall mean Requirements of Law related to terrorism financing or money laundering or sanctions, including the Executive Order or any enabling legislation or implementing legislation relating thereto, the Patriot Act, the Bank Secrecy Act, Part II.1 of the Criminal Code (Canada), the Proceeds of Crime (money laundering) and Terrorist Financing Act (Canada) (“PCTFA”), the Regulations Implementing the United Nations Resolutions on the Suppression of Terrorism (Canada) and the United Nations Al-Qaida and Taliban Regulations (Canada).

“Applicable Amount” shall mean the sum of (A)(x) cumulative Consolidated EBITDA from and after October 1, 2016, to the most recently completed fiscal quarter for which internal financial statements are available immediately preceding the date of the proposed action (for the avoidance of doubt, such cumulative Consolidated

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EBITDA shall include the Consolidated EBITDA for any such quarters, whether negative or positive); minus (y) 1.4 times the Cumulative Interest Expense; plus (without duplication) (B):

(1) the aggregate net cash proceeds, and the Fair Market Value of marketable securities or other property other than cash, received by the Canadian Borrower from the issue or sale (other than to a Restricted Subsidiary) of any class of Equity Interests, including Retired Capital Stock, in the Canadian Borrower after the Amendment No. 2 Effective Date, other than (A) Disqualified Capital Stock, (B) Equity Interests to the extent the net cash proceeds therefrom are applied as provided for Section 6.06(b)(iv), (C) Refunding Capital Stock and (D) Excluded Contributions; plus

(2) 100% of any cash and the Fair Market Value of marketable securities or other property other than cash received by the Canadian Borrower as a capital contribution from its shareholders subsequent to the Amendment No. 2 Effective Date other than any Excluded Contributions or any Cure Amount; plus

(3) the principal amount (or accreted amount (determined in accordance with GAAP), if less) of any Indebtedness, or the liquidation preference or maximum fixed repurchase price, as the case may be, of any Disqualified Capital Stock, of the Canadian Borrower or any Restricted Subsidiary issued after the Amendment No. 2 Effective Date (other than any such Indebtedness or Disqualified Capital Stock to the extent issued to a Restricted Subsidiary), which has been converted into or exchanged for Equity Interests in the Canadian Borrower (other than Disqualified Capital Stock); plus

(4) to the extent not already included in Consolidated EBITDA, 100% of the aggregate amount of cash and the Fair Market Value of marketable securities or other property other than cash received by the Canadian Borrower or a Restricted Subsidiary since the Amendment No. 2 Effective Date from (A) Investments (other than Cash Equivalents), whether through interest payments, principal payments, returns, profits, distributions, income and similar amounts, dividends or other distributions, repayments and payments, or the sale or other disposition (other than to the Canadian Borrower or a Restricted Subsidiary) thereof made by the Canadian Borrower and its Restricted Subsidiaries and (B) cash dividends from, or the sale (other than to the Canadian Borrower or a Restricted Subsidiary) of the stock of, an Unrestricted Subsidiary; plus

(5) if any Unrestricted Subsidiary is or was redesignated as a Restricted Subsidiary after the Amendment No. 2 Effective Date, the Fair Market Value of all Investments by the Canadian Borrower and its Restricted Subsidiaries in such Unrestricted Subsidiary after the Amendment No. 2 Effective Date, as determined in good faith by the Board of Directors of the Canadian Borrower at the time of the redesignation of such Unrestricted Subsidiary as a Restricted Subsidiary other than to the extent such Investment constituted a Permitted Investment or was made pursuant to Section 6.06(b)(xiv); plus

(6) $100,000,000;

less the amount of any Applicable Amount applied pursuant to any permitted usage under this Agreement after the Measurement Date.

“Applicable Canadian Pension Legislation” shall mean, at any time, any applicable Canadian federal or provincial pension benefits standards legislation, including all regulations made thereunder and all rules, regulations, rulings, guidelines, directives and interpretations made or issued by any Governmental Authority in Canada having or asserting jurisdiction in respect thereof, each as amended or replaced from time to time.

“Applicable Creditor” shall have the meaning assigned to such term in Section 9.17(b).

“Applicable Discount” shall have the meaning given to it in Section 2.12(f)(iii)(B).

“Applicable Lending Office” shall mean (i) with respect to any Lender and for each Type of Loan, the “Lending Office” of such Lender (or of an Affiliate of such Lender) designated for such Type of Loan in such

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Lender’s Administrative Questionnaire or in any applicable Assignment and Acceptance pursuant to which such Lender became a Lender hereunder or such other office of such Lender (or of an Affiliate of such Lender) as such Lender may from time to time specify to the Administrative Agent and the Canadian Borrower as the office by which its Loans of such Type are to be made and maintained and (ii) with respect to any L/C Issuer and for each Letter of Credit, the “Lending Office” of such L/C Issuer (or of an Affiliate of such L/C Issuer) designated on the signature pages hereto or such other office of such L/C Issuer (or of an Affiliate of such L/C Issuer) as such L/C Issuer may from time to time specify to the Administrative Agent and the Canadian Borrower as the office by which its Letters of Credit are to be issued and maintained.

“Applicable Margin” shall mean:

(a) in the case of the Term B-5 Loans (i) maintained as ABR Loans, a percentage per annum equal to 1.75%, and (ii) maintained as ~~Eurodollar~~Term Benchmark Loans, a percentage per annum equal to 2.75%;

(b) in the case of Revolving R-3 Facility Loans denominated in Canadian Dollars, a rate equal to the following percentages per annum, based upon the Total Leverage Ratio as set forth in the most recent certificate delivered to the Administrative Agent pursuant to Section 5.04(c):

Pricing Level	Total Leverage Ratio	Applicable Margin for Revolving R-3 Facility Loans that are Canadian Prime Rate Loans	Applicable Margin for Revolving R-3 Facility Loans that are BA Loans
1	Greater than or equal to 5.00:1.00	1.25%	2.25%
2	Less than 5.00:1.00 but greater than or equal to 4.50:1.00	1.00%	2.00%
3	Less than 4.50:1.00	0.75%	1.75%

(c) in the case of Revolving R-3 Facility Loans denominated in Dollars, a rate equal to the following percentages per annum, based upon the Total Leverage Ratio as set forth in the most recent certificate delivered to the Administrative Agent pursuant to Section 5.04(c):

Pricing Level	Total Leverage Ratio	Applicable Margin for Revolving R-3 Facility Loans that are ABR Loans	Applicable Margin for Revolving R-3 Facility Loans that are ~~Eurodollar~~‌Term Benchmark Loans
1	Greater than or equal to 5.00:1.00	1.25%	2.25%
2	Less than 5.00:1.00 but greater than or equal to 4.50:1.00	1.00%	2.00%
3	Less than 4.50:1.00	0.75%	1.75%

Notwithstanding anything to the contrary in this definition, during the period from the Amendment No. 6 Effective Date until the Section 5.04 Financials have been delivered for the fiscal year ending December 31, 2019, the Applicable Margin for Revolving R-3 Facility Loans shall be determined by reference to the applicable “Pricing Level 2” set forth in the tables above. Any increase or decrease in the Applicable Margin for Revolving R-3 Facility Loans resulting from a change in the Total Leverage Ratio shall become effective as of the first Business Day immediately following the date Section 5.04 Financials are delivered to the Administrative Agent; provided that, at the option of the Required Revolving Lenders, the highest pricing level (as set forth in the tables above) shall apply as of the fifth Business Day after the date on which Section 5.04 Financials were required to have been delivered but have not been delivered pursuant to Section 5.04 and shall continue to so apply to and including the date on which such Section 5.04 Financials are so delivered (and thereafter the pricing level otherwise determined in accordance with this definition shall apply).

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In the event that the Administrative Agent and the Canadian Borrower determine that any Section 5.04 Financials previously delivered were incorrect or inaccurate (regardless of whether this Agreement or the Commitments are in effect when such inaccuracy is discovered), and such inaccuracy, if corrected, would have led to the application of a higher Applicable Margin for any applicable period than the Applicable Margin applied for such applicable period, then (a) the Canadian Borrower shall as soon as practicable deliver to the Administrative Agent the correct Section 5.04 Financials for such applicable period, (b) the Applicable Margin shall be determined as if the pricing level for such higher Applicable Margin were applicable for such applicable period, and (c) the Canadian Borrower shall within 10 Business Days of demand thereof by the Administrative Agent pay to the Administrative Agent the accrued additional interest owing as a result of such increased Applicable Margin for such applicable period, which payment shall be promptly applied by the Administrative Agent in accordance with this Agreement.

“Approved Fund” shall mean 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 and that is administered, managed or advised by a Lender, an Affiliate of a Lender or an entity (including an investment advisor) or an Affiliate of such entity that administers, manages or advises a Lender.

“APT” shall have the meaning given to it in Section 5.10(e).

“APT Satellite Agreement” shall have the meaning given to it in Section 5.10(e).

“APT Security Agreement” shall mean, collectively, (a) the APT Parental Guarantee dated as of December 23, 2015, as amended, by and among APT Satellite Holdings Limited and Telesat International Limited and (b) the Declaration of Trust dated as of February 5, 2016, as amended, by Telesat International Limited.

“APT Transponders” shall mean those transponders subject to (a) that Satellite Transponder Agreement dated as of August 26, 2003 between APT Satellite Company Limited and Loral Orion, Inc. (as assigned to Telesat Satellite LP), as amended as of November 16, 2003 or (y) that Satellite Transponder Agreement dated as of December 23, 2015 between APT Satellite Company Limited and Telesat International Limited.

“Asset Sale” means:

(1) the sale, conveyance, transfer or other disposition, whether in a single transaction or a series of related transactions and whether effected pursuant to a division or otherwise, of property or assets (including by way of a Sale Leaseback) of the Canadian Borrower or any Restricted Subsidiary (each referred to in this definition as a “disposition”), or

(2) the issuance or sale of Equity Interests of any Restricted Subsidiary (other than preferred stock issued pursuant to Section 6.01), whether in a single transaction or a series of related transactions,

in each case, other than:

(a) a disposition of cash or Cash Equivalents, obsolete or worn out property or equipment, inventory, Excluded Satellites or other assets that in the reasonable judgment of the Canadian Borrower are no longer useful in the conduct of the business of the Canadian Borrower and its Restricted Subsidiaries and that in each case are disposed of in the ordinary course of business;

(b) the disposition of all or substantially all of the assets of the Canadian Borrower or any of the Restricted Subsidiaries in a manner permitted pursuant to Section 6.03 or any disposition that constitutes a Change of Control pursuant to this Agreement;

(c) the making of any Permitted Investment or Restricted Payment that is permitted to be made, and is made, under Section 6.06;

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(d) any disposition of assets or issuance or sale of Equity Interests of any Restricted Subsidiary in any transaction or series of transactions with an aggregate Fair Market Value not exceeding $25,000,000 for any such transaction or series of transactions;

(e) any disposition of property or assets or issuance of securities by a Restricted Subsidiary to the Canadian Borrower or by the Canadian Borrower or a Restricted Subsidiary to the U.S. Borrower or a Guarantor;

(f) to the extent allowable under Section 1031 of the Internal Revenue Code of 1986, any exchange of like property (excluding any boot thereon) for use in a Similar Business;

(g) the lease, assignment or sublease of any real or personal property in the ordinary course of business;

(h) any issuance or sale of Equity Interests in, or Indebtedness or other securities of, an Unrestricted Subsidiary;

(i) foreclosures on or expropriations of assets;

(j) any financing transaction with respect to property built, repaired, improved or acquired by the Canadian Borrower or any Restricted Subsidiary after the Amendment No. 6 Effective Date, including Sale Leasebacks and asset securitizations, permitted by this Agreement;

(k) any Casualty Event;

(l) dispositions of accounts receivable in connection with the collection or compromise thereof in the ordinary course of business and consistent with past practice;

(m) any transfer of transponders or the corresponding interest in the common elements on the Telstar 18 VANTAGE satellite to APT or its affiliates effected pursuant to a Satellite Transponder Agreement dated as of December 23, 2015 between Telesat International Limited and APT or a letter agreement dated December 31, 2015 between Telesat International Limited and APT, as amended from time to time;

(n) the granting of a Lien permitted under Section 6.02;

(o) contractual arrangements under long-term contracts with customers entered into by the Canadian Borrower and the Restricted Subsidiaries in the ordinary course of business which are treated as sales for accounting purposes; provided that there is no transfer of title in connection with such contractual arrangement;

(p) additional dispositions of assets (taken together with all such dispositions made pursuant to this clause (p)) since the Measurement Date with an aggregate Fair Market Value not exceeding $50,000,000;

(q) the licensing or sub-licensing of intellectual property or other general intangibles in the ordinary course of business or that is immaterial;

(r) the unwinding or termination of any Swap Agreement (unless entered into for speculative purposes) and allowing for the expiration of any options agreement with respect to any real property or personal property;

(s) the disposition of any of the property or assets of The SpaceConnection, Inc. or Infosat Communications LP; and

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(t) any Spectrum Repurposing.

In the event that a transaction (or any portion thereof) meets the criteria of a permitted Asset Sale and would also be a permitted Restricted Payment or Permitted Investment, the Canadian Borrower, in its sole discretion, shall be entitled to divide and classify such transaction (or a portion thereof) as an Asset Sale and/or one or more of the types of permitted Restricted Payments or Permitted Investments.

“Asset Sale Event” shall mean any Asset Sale not in the ordinary course of business.

“Assignment and Acceptance” shall mean an assignment and acceptance entered into by a Lender and an assignee, and accepted by the Administrative Agent and the Canadian Borrower (if required by such assignment and acceptance), substantially in the form of Exhibit A or such other form as shall be approved by the Administrative Agent.

“Attorney Costs” shall mean and includes all reasonable and documented or invoiced fees, expenses and disbursements of any law firm or other external counsel.

“Auction Agent” means (a) the Administrative Agent or (b) any other financial institution or advisor employed by the Canadian Borrower (whether or not an Affiliate of the Administrative Agent) to act as an arranger in connection with any Discounted Term Loan Prepayment pursuant to Section 2.12(f); provided that the Canadian Borrower shall not designate the Administrative Agent as the Auction Agent without the written consent of the Administrative Agent (it being understood that the Administrative Agent shall be under no obligation to agree to act as the Auction Agent); provided, further, that neither the Canadian Borrower nor any of its Affiliates may act as the Auction Agent.

“Auto-Extension Letter of Credit” shall have the meaning assigned to such term in Section 2.05(c)(iii).

“Availability Period” shall mean, in respect of the Revolving R-3 Facility Commitments, the period from and including the Amendment No. 6 Effective Date to the earliest of (A) the Revolving R-3 Facility Maturity Date, (B) the time of the termination of the Revolving R-3 Facility Commitments pursuant to Section 2.09 and (C) the time of termination of the commitment of each Lender to make Revolving R-3 Facility Loans and of the obligation of the L/C Issuers issue, extend or increase Letters of Credit, in each case pursuant to Section 7.01.

“Available Revolving Unused Commitment” shall mean, with respect to a Revolving R-3 Facility Lender at any time, an amount equal to the amount by which (a) the Revolving R-3 Facility Commitment of such Revolving R-3 Facility Lender at such time exceeds (b) the Revolving R-3 Facility Credit Exposure of such Revolving R-3 Facility Lender at such time.

“Available Tenor” shall mean, as of any date of determination and with respect to the then-current Benchmark, as applicable, any tenor for such Benchmark (or component thereof) or payment period for interest calculated with reference to such Benchmark (or component thereof), as applicable, that is or may be used for determining the length of an Interest Period for any term rate or otherwise, for determining any frequency of making payments of interest calculated pursuant to this Agreement as of such date and not including, for the avoidance of doubt, any tenor for such Benchmark that is then-removed from the definition of “Interest Period” pursuant to Section 2.15(e).

“BA” shall mean either a depository bill within the meaning of the Depository Bills and Notes Act (Canada) or a bill of exchange within the meaning of the Bills of Exchange Act (Canada), denominated in Canadian Dollars, drawn by the applicable Borrower on a Lender and accepted by a Lender in accordance with this Agreement and bearing such distinguishing letters and numbers as the Lender may determine; and, when used in conjunction with a “BA Borrowing” or a “BA Loan,” shall include BA Equivalent Loan.

“BA Borrowing” shall mean a Borrowing comprised of BA Loans.

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“BA Contract Period” shall mean, relative to any BA Loan, the period beginning on (and including) the date on which such BA Loan is made or continued to (but excluding) the date which is one, two, three or six months thereafter (or twelve months if, at the time of the relevant BA Loan, such term is agreed to by all relevant Lenders), as selected by the applicable Borrower; provided that (i) if any BA Contract Period would end on a day other than a Business Day, such BA Contract Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such BA Contract Period shall end on the next preceding Business Day, (ii) any BA Contract Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such BA Contract Period) shall end on the last Business Day of the last calendar month of such BA Contract Period and (iii) no BA Contract Period shall end after the Term B-5 Loan Maturity Date or the Revolving R-3 Facility Maturity Date, as applicable.

“BA Discount Rate” shall mean, with respect to any BA Contract Period for any BA Loan, (a) in the case of any Revolving R-3 Facility Lender named in Schedule I of the Bank Act (Canada), the rate determined by the Administrative Agent to be the average offered rate for bankers’ acceptances for the applicable BA Contract Period quoted on Reuters Screen CDOR (Canadian Dollar Offered Rate) page as of 11:00 a.m. (New York City time) on the first day of such BA Contract Period and (b) in the case of any other Revolving R-3 Facility Lender, (i) the rate per annum set forth in clause (a) above plus (ii) 0.10%; provided that in no event shall the BA Discount Rate be less than 0.00%. In the event that such rate is not quoted on the Reuters Screen CDOR (Canadian Dollar Offered Rate) page (or otherwise on the Reuters screen), the BA Discount Rate for the purposes of this definition shall be determined by reference to such other comparable publicly available service for displaying bankers’ acceptance rates as may be selected by the Administrative Agent, or, if such other comparable publicly available service for displaying bankers’ acceptance rates is not available, the BA Discount Rate shall be the average of the bankers’ acceptance rates quoted by the Reference Banks, as determined by the Administrative Agent, and, in the event that the CDOR rate is not available for any Business Day, the CDOR rate for the immediately previous Business Day for which a CDOR rate is available shall be used.

“BA Equivalent Loan” shall have the meaning given to it in Section 2.06(f).

“BA Loan” shall mean any Loan made by way of accepting and purchasing BAs on the same date and as to which a single BA Contract Period is in effect, and includes BA Equivalent Loans made on the same date and as to which a single BA Contract Period is in effect.

“Bail-In Action” shall mean the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

“Bail-In Legislation” shall mean with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

“Benchmark” shall mean, initially, with respect to any Term Benchmark Loan, the Term SOFR Rate; provided that if a Benchmark Transition Event and the related Benchmark Replacement Date have occurred with respect to the Term SOFR Rate or the then-current Benchmark, then “Benchmark” means the applicable Benchmark Replacement to the extent that such Benchmark Replacement has replaced such prior benchmark rate pursuant to Section 2.15(b).

“Benchmark Replacement” ~~means~~ shall mean, for any Available Tenor, the first alternative set forth in the order below that can be determined by the Administrative Agent for the applicable Benchmark Replacement Date:

(1) the Adjusted Daily Simple SOFR;

(2) the sum of: (a) the alternate benchmark rate ~~(which may be a SOFR-Based Rate)~~ that has been selected by the Administrative Agent and the Canadian Borrower as the replacement for the then-current Benchmark for the applicable Corresponding Tenor giving due consideration to (i) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body

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~~and/~~or (ii) any evolving or then-prevailing market convention for determining a benchmark rate ~~ofinterest~~ as a replacement ~~to~~for the ~~LIBO Rate~~then-current Benchmark for ~~Dollar~~dollar-denominated syndicated credit facilities at such time in the United States and (b) the related Benchmark Replacement Adjustment~~;~~~~provided~~ ~~that, if~~.

If the Benchmark Replacement as ~~so~~ determined pursuant to clause (1) or (2) above would be less than ~~zero~~the Floor, the Benchmark Replacement will be deemed to be ~~zero~~the Floor for the purposes of this Agreement~~;~~ ~~provided further~~ ~~thatany such Benchmark Replacement shall be administratively feasible as determined by the Administrative Agent in its sole reasonable discretion~~ and the other Loan Documents.

“Benchmark Replacement Adjustment” ~~means~~shall mean, with respect to any replacement of the then-current Benchmark with an Unadjusted Benchmark Replacement for any applicable Interest Period and Available Tenor for any setting of such Unadjusted Benchmark Replacement, the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that has been selected by the Administrative Agent and the Canadian Borrower for the applicable Corresponding Tenor giving due consideration to (i) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of ~~the LIBO Rate~~such Benchmark with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body on the applicable Benchmark Replacement Date and/or (ii) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of ~~theLIBO Rate~~such Benchmark with the applicable Unadjusted Benchmark Replacement for ~~Dollar~~dollar-denominated syndicated credit facilities at such time ~~(for the avoidance of doubt, such Benchmark Replacement Adjustmentshall not be in the form of a reduction to the Applicable Margin)~~.

“Benchmark Replacement Conforming Changes” ~~means~~shall mean, with respect to any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of “Alternate Base Rate,” the definition of “Business Day,” the definition of “U.S. Government Securities Business Day,” the definition of “Interest Period,” timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, length of lookback periods, the applicability of breakage provisions, and other technical, administrative or operational matters) that the Administrative Agent decides, after consultation with the Canadian Borrower, in its reasonable discretion may be appropriate to reflect the adoption and implementation of such Benchmark ~~Replacement~~ and to permit the administration thereof by the Administrative Agent in a manner substantially consistent with market practice (or, if the Administrative Agent decides in its reasonable discretion that adoption of any portion of such market practice is not administratively feasible or if the Administrative Agent determines that no market practice for the administration of ~~the~~such Benchmark ~~Replacement~~ exists, in such other manner of administration as the Administrative Agent decides in its reasonable discretion is reasonably necessary in connection with the administration of this Agreement and the other Loan Documents).

“Benchmark Replacement Date” ~~means~~shall mean, with respect to any Benchmark, the ~~earlier~~earliest to occur of the following events with respect to ~~the LIBO Rate~~such then-current Benchmark:

(1) in the case of clause (1) or (2) of the definition of “Benchmark Transition Event,” the later of (a) the date of the public statement or publication of information referenced therein and (b) the date on which the administrator of ~~the applicableReference Rate~~such Benchmark (or the published component used in the calculation thereof) permanently or indefinitely ceases to provide ~~the applicableReference Rate~~all Available Tenors of such Benchmark (or such component thereof); or

(2) in the case of clause (3) of the definition of “Benchmark Transition Event,” the first date ~~of~~on which such Benchmark (or the published component used in the calculation thereof) has been determined and announced by the regulatory supervisor for the administrator of such Benchmark (or such component thereof) to be no longer representative; provided, that such non-representativeness will be determined by reference to the ~~public~~most recent statement or publication ~~of information~~ referenced ~~therein~~in such clause (3) and even if any Available Tenor of such Benchmark (or such component thereof) continues to be provided on such date.

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For the avoidance of doubt, (i) if the event giving rise to the Benchmark Replacement Date occurs on the same day as, but earlier than, the Reference Time in respect of any determination, the Benchmark Replacement Date will be deemed to have occurred prior to the Reference Time for such determination and (ii) the “Benchmark Replacement Date” will be deemed to have occurred in the case of clause (1) or (2) with respect to any Benchmark upon the occurrence of the applicable event or events set forth therein with respect to all then-current Available Tenors of such Benchmark (or the published component used in the calculation thereof).

“Benchmark Transition Event” ~~means~~shall mean, with respect to any Benchmark, the occurrence of one or more of the following events with respect to ~~theLIBO Rate~~such then-current Benchmark:

(1) a public statement or publication of information by or on behalf of the administrator of ~~the applicable Reference Rate~~such Benchmark (or the published component used in the calculation thereof) announcing that such administrator has ceased or will cease to provide ~~the applicable Reference Rate~~all Available Tenors of such Benchmark (or such component thereof), permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide ~~the applicableReference Rate~~any Available Tenor of such Benchmark (or such component thereof);

(2) a public statement or publication of information by the regulatory supervisor for the administrator of ~~the applicable ReferenceRate~~such Benchmark (or the published component used in the calculation thereof), the Board, the ~~U.S.~~ Federal Reserve ~~System~~Bank of New York, the CME Term SOFR Administrator, an insolvency official with jurisdiction over the administrator for ~~theapplicable Reference Rate~~such Benchmark (or such component), a resolution authority with jurisdiction over the administrator for ~~the applicable Reference Rate~~such Benchmark (or such component) or a court or an entity with similar insolvency or resolution authority over the administrator for ~~the applicable Reference Rate~~such Benchmark (or such component), in each case, which states that the administrator of ~~the applicable Reference Rate~~such Benchmark (or such component) has ceased or will cease to provide ~~the applicable Reference Rate~~all Available Tenors of such Benchmark (or such component thereof) permanently or indefinitely~~,~~; provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide ~~the applicable Reference Rate~~any Available Tenor of such Benchmark (or such component thereof); ~~and/~~or

(3) a public statement or publication of information by the regulatory supervisor for the administrator of ~~the applicable ReferenceRate announcing that the applicable Reference Rate is no longer~~such Benchmark (or the published component used in the calculation thereof) announcing that all Available Tenors of such Benchmark (or such component thereof) are no longer, or as of a specified future date will no longer be, representative.

For the avoidance of doubt, a “Benchmark Transition ~~Start Date~~~~”means (a) in the case of a Benchmark Transition Event, the earlier of (i) the applicable~~Event” will be deemed to have occurred with respect to any Benchmark ~~Replacement Date and (ii) if suchBenchmark Transition Event is~~if a public statement or publication of information ~~of a prospective event, the 90th day prior to the expected date of suchevent as of such public statement or publication of information~~set forth above has occurred with respect to each then-current Available Tenor of such Benchmark (or ~~if~~ the ~~expected date of such prospective event is fewer than 90 days after such statement or publication,the date of such statement or publication) and (b) in the case of an Early Opt-in Election, the date specified by the Administrative Agentor the Required Lenders, as applicable, by notice to the Canadian Borrower, the Administrative Agent (in the case of such notice by theRequired Lenders) and the Lenders~~published component used in the calculation thereof).

“Benchmark Unavailability Period” ~~means, if a Benchmark Transition Event and its related Benchmark Replacement Date haveoccurred with respect to the LIBO Rate and solely to the extent that the LIBO Rate has not been replaced with a~~shall mean, with respect to any Benchmark ~~Replacement~~, the period (if any) (x) beginning at the time that ~~such~~a Benchmark Replacement Date pursuant to clauses (1) or (2) of that definition has occurred if, at such time, no Benchmark Replacement has replaced ~~the LIBO Rate~~such then-current Benchmark for all purposes hereunder and under any Loan Document in accordance with Section 2.15 and (y) ending at the time that a Benchmark Replacement has replaced ~~theLIBO Rate~~such then-current Benchmark for all purposes hereunder ~~pursuant to~~and under any Loan Document in accordance with Section 2.15.

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“Beneficial Ownership Certification” means a certification regarding beneficial ownership or control as required by the Beneficial Ownership Regulation.

“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.

“Benefit Plan” means any of (a) an “employee benefit plan” (as defined in ERISA) that is subject to Title I of ERISA, (b) a “plan” as defined in and subject to Section 4975 of the Code or (c) any Person whose assets include (for purposes of ERISA Section 3(42) or otherwise for purposes of Title I of ERISA or Section 4975 of the Code) the assets of any such “employee benefit plan” or “plan”.

“BHC Act Affiliate” of a party means an “affiliate’ (as such term is defined under, and interpreted in accordance with, 12 U.S.C. 1841(k)) of such party.

“BIA” shall mean the Bankruptcy and Insolvency Act (Canada), as amended.

“Board” shall mean the Board of Governors of the Federal Reserve System of the United States of America.

“Board of Directors” shall mean, with respect to any Person, (i) in the case of any corporation, the board of directors of such Person, (ii) in the case of any limited liability company, the board of managers of such Person, (iii) in the case of any partnership, the Board of Directors of the general partner of such Person and (iv) in any other case, the functional equivalent of the foregoing.

“Borrower Offer of Specified Discount Prepayment” shall mean the offer by the Canadian Borrower or any of its Restricted Subsidiaries to make a voluntary prepayment of Term Loans at a Specified Discount to par pursuant to Section 2.12(f)(ii).

“Borrower Solicitation of Discount Range Prepayment Offer” shall mean the solicitation by the Canadian Borrower or any of its Restricted Subsidiaries of offers for, and the corresponding acceptance by a Lender of, a voluntary prepayment of Term Loans at a specified range of discounts to par pursuant to Section 2.12(f)(iii).

“Borrower Solicitation of Discounted Prepayment Offer” shall mean the solicitation by any the Canadian Borrower or any of its Restricted Subsidiaries of offers for, and the subsequent acceptance, if any, by a Lender of, a voluntary prepayment of Term Loans at a discount to par pursuant to Section 2.12(f)(iv).

“Borrowers” shall mean, collectively, the Canadian Borrower and the U.S. Borrower.

“Borrowing” shall mean any Loans of the same Type and currency made, converted or continued on the same date and, in the case of ~~Eurodollar~~Term Benchmark Loans or BA Loans, as to which a single Interest Period is in effect.

“Borrowing Minimum” shall mean (a) in the case of a Term B-5 Loan Borrowing, $5,000,000, (c) in the case of a Revolving R-3 Facility Borrowing denominated in Canadian Dollars, CND$2,000,000, (d) in the case of a Revolving R-3 Facility Borrowing denominated in Dollars, $2,000,000 and (e) in the case of a Swingline Borrowing, $1,000,000.

“Borrowing Multiple” shall mean (a) in the case of a Term B-5 Loan Borrowing or a Revolving R-3 Facility Borrowing denominated in Dollars, $1,000,000 and (b) in the case of a Swingline Borrowing, $500,000.

“Borrowing Request” shall mean a request by a Borrower in accordance with the terms of Section 2.03 and substantially in the form of Exhibit B-1 or such other form as may be approved by the Administrative Agent acting reasonably.

“Business Day” shall mean any day that is not a Saturday, Sunday or other day on which commercial banks in New York City or Toronto are authorized or required by law to remain closed; provided that, ~~when used in connection with a Eurodollar Loan,~~notwithstanding the ~~term “~~foregoing, a Business Day~~” shall~~ must also ~~exclude any~~

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~~day on which banks are not open for dealings in deposits in the applicable currencyin the London interbank market~~be a U.S. Government Securities Business Day in relation to any Term Benchmark Loan and any interest rate settings, fundings, disbursements, settlements or payments of any such Term Benchmark Loan, or any other dealings in respect of such Term Benchmark Loan.

“Buyer” shall mean any direct or indirect purchaser or purchasers (other than any Person who is a Permitted Holder under clauses (a)(i) through (a)(iii) and (a)(xi) (as it relates to clauses (a)(i) through (a)(iii)) of the definition thereof) of all or a majority of the Equity Interests of the Canadian Borrower or any parent entity of the Canadian Borrower in connection with a Permitted Change of Control, which may include a strategic competitor or other company, private equity fund, similar investment fund or sovereign wealth fund, or consortium of companies, private equity funds, similar investment funds or sovereign wealth funds acting in concert, together with the Affiliates of such purchaser or purchasers that consummates a Permitted Change of Control; provided that, notwithstanding any other provision to the contrary, in no event shall any Person referenced in Section 3.21(b)(i) through (vi) constitute a Buyer.

“Calculation Date” shall mean (a) the last Business Day of each calendar month, (b) each date (with such date to be reasonably determined by the Administrative Agent) that is on or about the date of (i) a Borrowing Request or an Interest Election Request with respect to any Revolving R-3 Facility Loan, (ii) the issuance of a Letter of Credit or (iii) a request for a Swingline Borrowing, and (c) if an Event of Default under Section 7.01(b) or (d) has occurred and is continuing, any Business Day as determined by the Administrative Agent in its sole discretion.

“Canada Pension Plan” shall mean the universal pension plan established and maintained by the Federal Government of Canada.

“Canadian Borrower” shall have the meaning given to such term in the introductory paragraph of this Agreement and shall include, if applicable, any Successor Company with or into which the Canadian Borrower merges, amalgamates or consolidates in accordance with Section 6.03.

“Canadian Dollar,” “CAD” and “CND$” shall mean the lawful currency of Canada.

“Canadian Dollar Equivalent” shall mean, on any date of determination, (a) with respect to any amount in Canadian Dollars, such amount and (b) with respect to any amount in Dollars, the equivalent in Canadian Dollars of such amount as determined by the Administrative Agent pursuant to Section 1.03(b) using the Exchange Rate with respect to Dollars at the time in effect under the provisions of such Section.

“Canadian Letter of Credit” shall mean a Letter of Credit denominated in Canadian Dollars.

“Canadian Pension Event” shall mean, with respect to any Canadian Plan, (a) the termination or wind-up, in full or in part, of such Canadian Plan (including the institution of any steps by any Person to terminate or wind-up or order the termination or wind-up, in full or in part, of such Canadian Plan) or any act or omission with respect to such Canadian Plan that, individually or in the aggregate, could reasonably be expected to adversely affect the tax status of such Canadian Plan or result in any liability, fine or penalty on any Loan Party or (b) the failure to make full payment when due of all amounts which, under the provisions of such Canadian Plan, any agreement relating thereto or Applicable Canadian Pension Legislation, any Loan Party is required to pay as contributions thereto.

“Canadian Plan” shall mean any plan, program, agreement or arrangement that is a pension plan for the purposes of Applicable Canadian Pension Legislation or under the Income Tax Act (Canada) (whether or not registered under such law) that is maintained or contributed to, or to which there is or may be an obligation to contribute, by the Canadian Borrower or any of its Subsidiaries in respect of their respective employees in Canada, but does not include the Canada Pension Plan or the Quebec Pension Plan that is mandated by the Government of Canada or the Province of Quebec, respectively.

“Canadian Prime Rate” shall mean on any date with respect to ABR Loans denominated in Canadian Dollars, a fluctuating rate of interest per annum (rounded upward, if necessary, to the next highest 1/100 of 1%) equal to the higher of: (a) the rate of interest per annum determined by taking the average of the determination by

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each of the Reference Banks as its reference rate in effect on such day for determining interest rates for Canadian Dollar denominated commercial loans in Canada; and (b) the BA Discount Rate in effect on that day, as determined by the Reference Banks for one month bankers’ acceptances plus 3/4 of 1%.

“Canadian Prime Rate Borrowing” shall mean a Borrowing comprised of Canadian Prime Rate Loans.

“Canadian Prime Rate Loan” shall mean any Loan bearing interest at a rate determined by reference to the Canadian Prime Rate in accordance with the provisions of Article II.

“Canadian Security Agreements” shall mean (i) a security agreement substantially in the form of Exhibit D-2 among the Loan Parties organized in Canada and the Collateral Agent for the benefit of the Secured Parties and (ii) each deed of hypothec substantially in the form of Exhibit H between each Loan Party organized under the laws of the Province of Quebec or having its chief executive office or domicile in Quebec or tangible property (not ordinarily used in more than one jurisdiction) in Quebec, each debenture issued by each such Loan Party under each such deed of hypothec and each pledge agreement between each such Loan Party and the Collateral Agent with respect to each such debenture, provided that the form of deed of hypothec (Exhibit H) may be modified for the purposes of any deed of hypothec executed after the coming into force on April 21, 2015 of the amendments to Article 2692 of the Civil Code of Quebec in order to reflect such amendments, including the removal of the provisions relating to the creation, issuance and securing of debentures, and constituting each hypothec thereunder as security for the Secured Obligations.

“Cancom Agreement” shall have the meaning given to it in Section 9.18(b).

“Capital Expenditures” shall mean, for any period, the aggregate of, without duplication, (a) all expenditures (whether paid in cash or accrued as liabilities) by the Canadian Borrower and the Restricted Subsidiaries during such period that, in conformity with GAAP, are or are required to be included as additions during such period to property, plant or equipment reflected in the consolidated balance sheet of the Canadian Borrower and its Restricted Subsidiaries, (b) all Capitalized Software Expenditures and Capitalized Research and Development Costs during such period and (c) all fixed asset additions financed through Finance Lease Obligations incurred by the Canadian Borrower and the Restricted Subsidiaries and recorded on the balance sheet in accordance with GAAP during such period; provided that the term “Capital Expenditures” shall not include (i) expenditures made in connection with the replacement, substitution, restoration or repair of assets (A) to the extent financed from insurance proceeds paid on account of the loss of or damage to the assets being replaced, restored or repaired or (B) with awards of compensation arising from the taking by eminent domain or condemnation of the assets being replaced, (ii) the purchase price of equipment that is purchased simultaneously with the trade-in of existing equipment to the extent that the gross amount of such purchase price is reduced by the credit granted by the seller of such equipment for the equipment being traded in at such time, (iii) the purchase of plant, property or equipment made within two years of the sale of any asset to the extent purchased with the proceeds of such sale (except to the extent that such proceeds otherwise increase Consolidated Net Income for purposes of calculating Excess Cash Flow for such period), (iv) expenditures that constitute any part of Consolidated Lease Expense, (v) capitalized interest in connection with the purchase of Satellites, (vi) expenditures that are accounted for as capital expenditures of such person and that actually are paid for, or reimbursed, by a third party (other than the Canadian Borrower or any Subsidiary thereof) for which neither the Canadian Borrower nor any Subsidiary thereof has provided or is required to provide or incur, directly or indirectly, any consideration or obligation to such third party or any other person (whether before, during or after such period), (vii) expenditures to the extent they are made with proceeds of the issuance of Equity Interests of the Canadian Borrower after the Closing Date, (viii) the book value of any asset owned by the Canadian Borrower or any Restricted Subsidiary prior to or during such period to the extent that such book value is included as a capital expenditure during such period as a result of such person reusing or beginning to reuse such asset during such period without a corresponding expenditure actually having been made in such period; provided that (x) any expenditure necessary in order to permit such asset to be reused shall be included as a Capital Expenditure during the period in which such expenditure actually is made and (y) such book value shall have been included in Capital Expenditures when such asset was originally acquired, (ix) any capitalized interest expense and internal costs reflected as additions to property, plant or equipment in the consolidated balance sheet of the Canadian Borrower and the Restricted Subsidiaries or capitalized as Capitalized Software Expenditures and Capitalized Research and Development Costs for such period and (x) any non-cash compensation or other non-cash costs

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reflected as additions to property, plant and equipment, Capitalized Software Expenditures and Capitalized Research and Development Costs in the consolidated balance sheet of the Canadian Borrower and the Restricted Subsidiaries.

“Capital Stock” means:

(1) in the case of a corporation, corporate stock;

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

(3) in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited); and

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

“Capitalized Research and Development Costs” shall mean, for any period, all research and development costs that are, or are required to be, in accordance with GAAP, reflected as capitalized costs on the consolidated balance sheet of the Canadian Borrower and the Restricted Subsidiaries.

“Capitalized Software Expenditures” shall mean, for any period, the aggregate of all expenditures (whether paid in cash or accrued as liabilities) by the Canadian Borrower and the Restricted Subsidiaries during such period in respect of purchased software or internally developed software and software enhancements that, in conformity with GAAP, are or are required to be reflected as capitalized costs on the consolidated balance sheet of the Canadian Borrower and the Restricted Subsidiaries.

“Cash Collateralize” shall mean to pledge and deposit with or deliver to the Collateral Agent, for the benefit of the L/C Issuers and the Revolving R-3 Facility Lenders, as collateral for the L/C Obligations, cash or deposit balances pursuant to documentation in form and substance reasonably satisfactory to the Administrative Agent and the L/C Issuers.

“Cash Equivalents” shall mean:

(i) securities or obligations issued or unconditionally guaranteed by the United States government, the Government of Canada or any agency or instrumentality thereof, in each case having maturities of not more than 24 months from the date of acquisition thereof;

(ii) securities or obligations issued by any state of the United States of America, any province of Canada or any political subdivision of any such state or province, or any public instrumentality thereof, having maturities of not more than 24 months from the date of acquisition thereof and, at the time of acquisition, having an investment grade rating generally obtainable from either S&P or Moody’s (or, if at any time neither S&P nor Moody’s shall be rating such obligations, then from another nationally recognized rating service);

(iii) commercial paper and variable or fixed rate notes issued by any Lender or any bank holding company owning any Lender or any variable rate notes issued by, or guaranteed by, any domestic corporation not an Affiliate of the Canadian Borrower rated (x) A-1 (or the equivalent thereof) or better by S&P, or (y) P-1 (or the equivalent thereof) or better by Moody’s, and maturing within one year of the date of acquisition;

(iv) commercial paper maturing no more than 12 months after the date of creation thereof and, at the time of acquisition, having a rating of at least A-2 or P-2 from either S&P or Moody’s (or, if at any time neither S&P nor Moody’s shall be rating such obligations, an equivalent rating from another nationally recognized rating service);

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(v) domestic and ~~LIBOR~~eurodollar certificates of deposit or bankers’ acceptances maturing no more than two years after the date of acquisition thereof issued by any Lender or any other bank having combined capital and surplus of not less than $250,000,000 in the case of domestic banks and $100,000,000 (or the Dollar Equivalent thereof) in the case of foreign banks;

(vi) auction rate securities rated at least Aa3 by Moody’s and AA- by S&P (or, if at any time either S&P or Moody’s shall not be rating such obligations, an equivalent rating from another nationally recognized rating service);

(vii) repurchase agreements with a term of not more than 30 days for underlying securities of the type described in clauses (i), (ii) and (v) above entered into with any bank meeting the qualifications specified in clause (v) above or securities dealers of recognized national standing;

(viii) repurchase obligations with respect to any security that is a direct obligation or fully guaranteed as to both credit and timeliness by the Government of Canada or any agency or instrumentality thereof, the obligations of which are backed by the full faith and credit of the Government of Canada, in either case entered into with any Canadian I or II bank or any trust company (acting as principal);

(ix) repurchase agreements with a term of not more than one year with a bank or trust company (including any of the Lenders) or recognized securities dealer having capital and surplus in excess of $250,000,000 for direct obligations issued by or fully guaranteed by the United States of America in which the Canadian Borrower or one or more of its Restricted Subsidiaries shall have a perfected first priority security interest (subject to no other Liens) and having, on the date of purchase thereof, a Fair Market Value of at least 100% of the amount of the repurchase obligations;

(x) marketable short-term money market and similar funds (x) either having assets in excess of $250,000,000 or (y) having a rating of at least A-2 or P-2 from either S&P or Moody’s (or, if at any time neither S&P nor Moody’s shall be rating such obligations, an equivalent rating from another nationally recognized rating service in the United States);

(xi) shares of investment companies that are registered under the Investment Company Act of 1940 and 95% of the investments of which are one or more of the types of securities described in clauses (i) through (x) above;

(xii) any other investments used by the Canadian Borrower and its Restricted Subsidiaries as temporary investments permitted by the Administrative Agent in writing in its sole discretion; and

(xiii) in the case of Investments by the Canadian Borrower or any Subsidiary organized or located in a jurisdiction other than the United States (or any political subdivision or territory thereof), or in the case of Investments made in a country outside the United States of America, other customarily utilized high-quality Investments in the country where such Subsidiary is organized or located or in which such Investment is made, all as reasonably determined in good faith by the Canadian Borrower.

“Cash Management Agreement” shall mean any agreement or other instrument governing Cash Management Obligations.

“Cash Management Bank” shall mean any Person that, at the time it provides any cash management services pursuant to a Cash Management Agreement, is a Lender, Agent or Joint Lead Arranger or an Affiliate of a Lender, Agent or Joint Lead Arranger, or The Bank of Nova Scotia or an Affiliate thereof, each in its capacity as a party to such Cash Management Agreement, or any Person that shall have become a Lender, Agent or Joint Lead Arranger or an Affiliate of a Lender, Agent or Joint Lead Arranger at any time after it has provided any cash management services pursuant to a Cash Management Agreement.

“Cash Management Obligation” shall mean, as applied to any Person, any direct or indirect liability, contingent or otherwise, of such Person in respect of cash management services (including treasury, depository,

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overdraft, credit or debit card, electronic funds transfer and other cash management arrangements) provided by any Cash Management Bank to the Canadian Borrower or any of its Restricted Subsidiaries, including obligations for the payment of agreed interest and reasonable, fees, charges, expenses, Attorney Costs and disbursements in connection therewith.

“Casualty Event” shall mean, with respect to any property (including any Satellite) of any Person, any loss of or damage to, or any condemnation or other taking by a Governmental Authority of, such property for which such Person or any of its Restricted Subsidiaries receives insurance proceeds, or proceeds of a condemnation award or other compensation.

“CCAA” shall mean the Companies’ Creditors Arrangement Act (Canada), as amended.

“Change in Law” shall mean (a) the adoption of any law, rule or regulation after the Amendment No. 2 Effective Date, (b) any change in law, rule or regulation or in the official interpretation or application thereof by any Governmental Authority after the Amendment No. 2 Effective Date or (c) compliance by any Lender or L/C Issuer (or, for purposes of Section 2.16(b), by any lending office of such Lender or by such Lender’s or L/C Issuer’s holding company, if any) with any written request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the Amendment No. 2 Effective Date. Notwithstanding anything to the contrary herein, it is understood and agreed that (x) the Dodd–Frank Wall Street Reform and Consumer Protection Act (Pub.L. 111-203, H.R. 4173) and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Basel Committee on Banking Regulations and Supervision pursuant to Basel III, and, in each case, all interpretations and applications thereof and any compliance by a Lender with any request or directive relating thereto, shall, for the purposes of this Agreement, be deemed to be adopted subsequent to the Amendment No. 2 Effective Date.

“Change of Control” means the occurrence of any of the following:

(1) the sale, lease or transfer, in one or a series of related transactions, of all or substantially all of the assets of the Canadian Borrower and its Subsidiaries, taken as a whole, to any Person other than a Permitted Holder;

(2) the Canadian Borrower becomes aware of (by way of a report or any other filing pursuant to Section 13(d) of the Exchange Act, proxy, vote, written notice or otherwise) the acquisition by any Person or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, or any successor provision), including any group acting for the purpose of acquiring, holding or disposing of securities (within the meaning of Rule 13d-5(b)(1) under the Exchange Act) other than the Permitted Holders, in a single transaction or in a related series of transactions, by way of merger, consolidation or other business combination or purchase of beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act, or any successor provision) of more than 50.0% of the total voting power of the Voting Stock of the Canadian Borrower or any company that holds directly or indirectly more than 50.0% of the total voting power of the Voting Stock of the Canadian Borrower; or

(3) Change of Control (as defined in the Senior Notes (or any Permitted Refinancing thereof)) shall have occurred.

Notwithstanding the foregoing, at any time in connection with, or after, a Qualified IPO, a transaction in which the Canadian Borrower becomes a subsidiary of another Person (other than a Person that is an individual) shall not constitute a Change of Control if (a) the shareholders of the Canadian Borrower immediately prior to such transaction beneficially own (within the meaning of Rule 13d-3 under the Exchange Act, or any successor provision), directly or indirectly through one or more intermediaries, more than 50.0% of the total voting power of the outstanding Voting Stock of the Canadian Borrower, immediately following the consummation of such transaction or (b) immediately following the consummation of such transaction, no Person (within the meaning of Section 13(d)(3) of the Exchange Act, or any successor provision), other than such Person or its direct or indirect subsidiaries or the Permitted Holders, beneficially owns (as such term is defined above), directly or indirectly through one or more intermediaries, more than 50.0% of the voting power of the outstanding Voting Stock of the Canadian Borrower.

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In addition, notwithstanding the preceding or any provision of Section 13(d) or 14(d) of the Exchange Act (or any successor provision), (i) a Person, entity or “group” shall not be deemed to beneficially own securities subject to an equity or asset purchase agreement, merger agreement or similar agreement (or voting or option or similar agreement related thereto) until the consummation of the transactions contemplated by such agreement, (ii) if any “group” includes one or more Permitted Holders, the issued and outstanding Voting Stock of the Canadian Borrower beneficially owned, directly or indirectly, by any Permitted Holders that are part of such “group” shall not be treated as being beneficially owned by any other member of such “group” for purposes of determining whether a Change of Control has occurred and (iii) a Person, entity or “group” will not be deemed to beneficially own the Voting Stock of another Person as a result of its ownership of Voting Stock or other securities of such other Person’s parent entity (or related contractual rights) unless it owns more than 50.0% of the total voting power of the Voting Stock of such parent entity. For purposes of this definition, except with respect to clause (1) hereunder, and any related definition to the extent used for purposes of this definition, at any time when more than 50.0% of the total voting power of the Voting Stock of the Canadian Borrower is directly or indirectly owned by a parent entity, all references to the Canadian Borrower shall be deemed to refer to its ultimate parent entity (but excluding (x) any Permitted Holder and (y) in the case where the entity that engaged in a Qualified IPO is a limited partnership, the general partner of which is owned by a convenience party, such as a trust for the benefit of a charity, such general partner and such convenience party (but not any other Person or “group” who has the right to direct the general partner in its capacity as such)) that directly or indirectly owns such Voting Stock. For the avoidance of doubt and without limiting the generality of the foregoing, with respect to any voting trust that is beneficially owned by a convenience party, such as a trust for the benefit of a charity, such voting trust and such convenience party (but not any other Person or “group” to the extent such Person or “group” has the right to direct the voting of Voting Stock held by such voting trust) shall be disregarded for purposes of this definition.

“Charges” shall have the meaning assigned to such term in Section 9.09.

“CIBC” shall mean Canadian Imperial Bank of Commerce.

“CIP Regulations” shall have the meaning assigned to such term in Section 8.06(b).

“Class”, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are Revolving R-3 Facility Loans, Term B-5 Loans, Incremental Term Loans (of a Class), Extended Term Loans (of the same Extension Series), Extended Revolving Credit Loans (of the same Extension Series and any related swingline loans thereunder) or Swingline Loans, and, when used in reference to any Commitment, refers to whether such Commitment is a Revolving R-3 Facility Commitment, a Term B-5 Loan Commitment, an Incremental Term Loan Commitment (of the same Class), an Extended Revolving Credit Commitment (of the same Extension Series and any related swingline commitment thereunder), or a Swingline Commitment, and when used in reference to any Lender, refers to whether such Lender has a Loan or Commitment of such Class.

“Closing Date” shall mean March 28, 2012.

“CME Term SOFR Administrator” shall mean CME Group Benchmark Administration Limited as administrator of the forward-looking term Secured Overnight Financing Rate (SOFR) (or a successor administrator).

“Code” shall mean the U.S. Internal Revenue Code of 1986, as amended.

“Collateral” shall mean all property and assets (including Equity Interests) subject to a Lien created under any Security Document and shall also include the Mortgaged Properties.

“Collateral Agent” shall mean JPMCB or any successor thereto appointed in accordance with the provisions of Section 8.09, together with any Persons that are appointed as sub-agents in accordance with Section 8.02, in each case, as the collateral agent for the Secured Creditors.

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“Collateral and Guarantee Requirements” shall mean, subject to the Agreed Security Principles and Section 5.10, the requirements that:

(a) as of the Closing Date, all of the Loan Documents described in Schedule 1.01(a) shall have been executed and delivered the Canadian Borrower, the Borrowers and the Subsidiary Loan Parties party thereto, as applicable, and, to the extent applicable under the relevant governing law, all Liens created by the pledging of securities and/or other instruments shall have been perfected (by the pledging of such securities and/or instruments or otherwise); provided, however, that with respect to any Collateral the security interest or hypothec in which may not be perfected or published by filing of UCC and PPSA financing statements or applications for registration in the Quebec register of personal and moveable real rights (the “PMRR”) or the possession of stock certificates, if the perfection or publication of the Collateral Agent’s security interest or hypothec, as applicable, in such Collateral may not be accomplished prior to the Closing Date after the Canadian Borrower’s use of commercially reasonable efforts to do so, then delivery of documents and instruments for perfection or publication of such security interest or hypothec, as applicable, shall not constitute a condition precedent under Section 4.02 of this Agreement and the Canadian Borrower agrees to deliver or cause to be delivered such documents and instruments, and take or cause to be taken such other actions as may be required to perfect and publish such security interests and hypothecs, within 90 days after the Closing Date (or such later date as may be agreed to by the Administrative Agent in its sole discretion) (it being understood that commercially reasonable efforts in this context shall mean at a minimum that UCC and PPSA financing statements and applications for registration in the PMRR have been filed for each of the Loan Parties and stock certificates of entities organized in the United States or Canada shall have been delivered);

(b) in the case of any Subsidiary that becomes a Subsidiary Loan Party after the Amendment No. 2 Effective Date, the Administrative Agent shall have received, unless it has waived such requirement for such Subsidiary Loan Party (for reasons of cost, legal limitations, tax consequences or such other matters as deemed appropriate by the Administrative Agent, acting reasonably), an executed subsidiary joinder agreement substantially in the form of Exhibit J or such other form as shall be reasonably acceptable to the Administrative Agent and execute such Security Documents (other than in respect of real property which is the subject of another clause), by way of joinder or otherwise that the Administrative Agent may reasonably request;

(c) all the Equity Interests of Subsidiaries that are acquired by a Loan Party after the Amendment No. 2 Effective Date shall be pledged pursuant to the Security Documents; provided that Equity Interests in Subsidiaries that collectively account for less than 5% of the consolidated assets and revenues shall not be subject to this provision;

(d) the Collateral Agent shall have received all certificates or other instruments (if any) representing all Equity Interests of Subsidiaries required to be pledged pursuant to any of the paragraphs above, together with stock powers or other instruments of transfer with respect thereto endorsed in blank, in each case to the extent reasonably requested by counsel to the Collateral Agent, or such other action shall have been taken as required under applicable law to perfect a security interest in such Equity Interests as reasonably requested by counsel to the Administrative Agent;

(e) all Indebtedness for borrowed money that is owing to any Loan Party shall have been pledged pursuant to a Security Document and all such Indebtedness (other than intercompany debt evidenced by the Intercompany Note which has already been pledged to the Collateral Agent pursuant to the Security Documents) having a principal amount that has a Dollar Equivalent in excess of $3,000,000 (other than intercompany current liabilities incurred in the ordinary course of business) shall, if requested by the Administrative Agent and if relevant under the applicable governing law of such Security Document, be evidenced by a promissory note or an instrument and the Collateral Agent shall have received all such promissory notes or instruments, together with note powers or other instruments of transfer with respect thereto endorsed in blank;

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(f) all documents and instruments required by law or reasonably requested by the Collateral Agent to be filed, registered or recorded to create the Liens intended to be created by the Security Documents (in each case, including any supplements thereto) and perfect such Liens to the extent required by, and with the priority required by, the Security Documents, shall have been filed, registered or recorded or delivered to the Collateral Agent for filing, registration or the recording concurrently with, or promptly following, the execution and delivery of each such Security Document;

(g) the Collateral Agent shall have received on the Closing Date (in the case of each of those properties designated as a Mortgaged Property as set forth on Schedule 1.01(c)) or within the time period set forth in Section 5.10 (in the case of Additional Mortgages), (i) counterparts of a Mortgage with respect to each property designated as a Mortgaged Property as set forth on Schedule 1.01(c) hereto or Additional Mortgages required to be delivered pursuant to Section 5.10 duly executed and delivered by the record owner or holder of such real property, (ii) a paid Title Policy or Title Policies issued by the Title Company insuring the Lien of each such Mortgage as a valid Lien on the property described therein, free of any other Liens other than Permitted Liens, (iii) with respect to Additional Mortgages covering properties located in the United States, a completed “Life-of-Loan” Federal Emergency Management Agency Standard Flood Hazard Determination with respect to each Mortgaged Property (together with a notice about special flood hazard area status and flood disaster assistance duly executed by the Canadian Borrower and each Loan Party relating thereto) and, if applicable, evidence of flood insurance and (iv) such Surveys, existing appraisals and legal opinions as the Administrative Agent may reasonably request with respect to any such Mortgaged Property;

(h) [Reserved]; and

(i) each Loan Party shall have obtained all material consents and approvals required under this Agreement to be obtained by it in connection with (A) the execution, delivery and performance of all Security Documents (or supplements thereto) to which it is a party and (B) the granting by it of the Liens under each Security Document to which it is party.

“Commitment Fee Rate” shall mean a rate equal to the following percentages per annum, based upon the Total Leverage Ratio as set forth in the most recent certificate delivered to the Administrative Agent pursuant to Section 5.04(c):

Level	Total Leverage Ratio	Commitment Fee Rate
1	Greater than or equal to 4.50:1.00	0.375%
2	Less than 4.50:1.00	0.250%

Notwithstanding anything to the contrary in this definition, during the period from the Amendment No. 6 Effective Date until the Section 5.04 Financials have been delivered for the fiscal year ending December 31, 2019, the Commitment Fee Rate shall be determined by reference to the applicable “Level 1” set forth in the table above. Any increase or decrease in the Commitment Fee Rate resulting from a change in the Total Leverage Ratio shall become effective as of the first Business Day immediately following the date Section 5.04 Financials are delivered to the Administrative Agent; provided that, at the option of the Required Revolving Lenders, the highest level (as set forth in the table above) shall apply as of the fifth Business Day after the date on which Section 5.04 Financials were required to have been delivered but have not been delivered pursuant to Section 5.04 and shall continue to so apply to and including the date on which such Section 5.04 Financials are so delivered (and thereafter the level otherwise determined in accordance with this definition shall apply).

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period, (b) the Commitment Fee Rate shall be determined as if the level for such higher Commitment Fee Rate were applicable for such applicable period, and (c) the Canadian Borrower shall within 10 Business Days of demand thereof by the Administrative Agent pay to the Administrative Agent the accrued additional amounts owing as a result of such increased Commitment Fee Rate for such applicable period, which payment shall be promptly applied by the Administrative Agent in accordance with this Agreement.

“Commitments” shall mean (a) with respect to any Lender, such Lender’s Revolving R-3 Facility Commitment, or Term B-5 Loan Commitment, (b) with respect to any Swingline Lender, its Swingline Commitment and (c) any commitment to make Incremental Term Loans extended by such Lender as provided in Section 2.21.

“Commodity Exchange Act” shall mean the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor statute.

~~“~~~~CompoundedSOFR~~~~” means the compounded average of SOFRs for the applicable Corresponding Tenor, with the rate, or methodologyfor this rate, and conventions for this rate (which may include compounding in arrears with a lookback and/or suspension period as a mechanismto determine the interest amount payable prior to the end of each Interest Period) being established by the Administrative Agent in accordancewith:~~

~~(1)~~

~~the rate, or methodology for this rate, and conventions for this rate selected or recommended by the Relevant GovernmentalBody for determining compounded SOFR;~~ ~~provided~~ ~~that:~~

~~(2)~~

~~if, and to the extent that, the Administrative Agent determines that Compounded SOFR cannot be determined in accordance withclause (1) above, then the rate, or methodology for this rate, and conventions for this rate that the Administrative Agent determinesin its reasonable discretion are substantially consistent with any evolving or then-prevailing market convention for determining compoundedSOFR for U.S. dollar-denominated syndicated credit facilities at such time;~~

---

~~provided~~~~,~~~~further~~~~, that if the Administrative Agent decides that any such rate, methodology or conventiondetermined in accordance with clause (1) or clause (2) is not administratively feasible for the Administrative Agent, then CompoundedSOFR will be deemed unable to be determined for purposes of the definition of Benchmark Replacement.~~

“Consolidated Depreciation and Amortization Expense” means, with respect to any Person for any period, the total amount of depreciation and amortization expense, including the amortization of deferred financing fees, of such Person and its Restricted Subsidiaries for such period on a consolidated basis and otherwise determined in accordance with GAAP; provided that, in the event any item that represents an accrual or reserve for a cash expenditure in a future period is included in Consolidated Depreciation and Amortization Expense, the actual cash expenditure in such future period shall reduce Consolidated EBITDA.

“Consolidated EBITDA” shall mean, with respect to the Canadian Borrower and the Restricted Subsidiaries on a consolidated basis, for any period, an amount equal to Consolidated Net Income for such period

(1) increased (without duplication) by:

(a) Consolidated Income Tax Expense accrued for such period to the extent deducted in determining Consolidated Net Income for such period; plus

(b) Consolidated Interest Expense for such period to the extent deducted in determining Consolidated Net Income for such period; plus

(c) Consolidated Depreciation and Amortization Expense of such Person for such period to the extent such depreciation and amortization were deducted in computing Consolidated Net Income; plus

(d) to the extent deducted in arriving at Consolidated Net Income, foreign withholding Taxes paid or accrued in such period; plus

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(e) any expenses or charges related to any Qualified IPO, Investment permitted by this Agreement, acquisition, disposition, issuance of Indebtedness permitted to be incurred by this Agreement, any Permitted Change of Control, any Permitted Refinancing or any amendment or other modification of any debt instrument (whether or not successful), including any fees, expenses and charges related thereto and deducted in computing Consolidated Net Income; plus

(f) the amount of any restructuring charges or reserves deducted in such period in computing Consolidated Net Income, including any one-time costs incurred in connection with acquisitions and costs related to closure of facilities; plus

(g) any other non-cash charges reducing Consolidated Net Income for such period, excluding any such charge that represents an accrual or reserve for a cash expenditure for a future period; plus

(h) the amount of any minority interest expense deducted in calculating Consolidated Net Income (less the amount of any cash dividends paid to the holders of such minority interests); plus

(i) to the extent deducted in arriving at Consolidated Net Income, the annual consulting fee payable pursuant to the Consulting Services Agreement as in effect on the Measurement Date pursuant to Section 6.12(b)(xii); plus

(j) Transaction Expenses; plus

(k) solely for purposes of Section 6.12(b)(xii), the Senior Secured Leverage Ratio, the First Lien Leverage Ratio and the Total Leverage Ratio, in the event of any loss of any Satellite during the applicable Test Period, 90% of the contracted for revenues that would reasonably have been expected to be realized but for such loss for that portion of the period following such loss attributable to such Satellite (less revenue actually realized in respect of such Satellite during such period after such event of loss) so long as insurance for such Satellite required to be maintained pursuant to Section 5.02 is maintained in accordance with the terms thereof and the Canadian Borrower or a Restricted Subsidiary has filed a notice of loss with the applicable insurers and believes in good faith that the insurers will pay funds (and the applicable insurer(s) have not indicated that they will not pay such funds) in amounts that the Canadian Borrower or the Canadian Borrower reasonably believes will be sufficient, together with cash on hand (other than cash resulting from drawings under the Revolving R-3 Facility) and cash from operations, to replace such Satellite with a replacement Satellite that generates annual revenues for the Canadian Borrower and its Restricted Subsidiaries not less than the revenue generated by such replaced Satellite during the four-quarter period ended immediately prior to such event of loss; but such amounts may only be added to Consolidated EBITDA so long as the Canadian Borrower or the applicable Restricted Subsidiary intends promptly to replace such Satellite and is working reasonably to do so (provided that the amount added to Consolidated EBITDA under this clause (k) shall not exceed $100,000,000 for any Test Period); plus

(l) pro forma adjustments, including pro forma “run rate” cost savings, operating expense reductions, and other synergies related to mergers, business combinations, acquisitions, dispositions and other similar transactions, or related to restructuring initiatives, cost savings initiatives and other initiatives, in each case projected by the Canadian Borrower in good faith to result from actions that have been taken, actions with respect to which substantial steps have been taken or actions that are expected to be taken (in each case, in the good faith determination of the Canadian Borrower), in any such case, within six fiscal quarters after the date of consummation of such merger, business combination, acquisition, disposition or other similar transaction or the initiation of such restructuring initiative, cost savings initiative or other initiative; provided that the aggregate amount of all such pro forma adjustments pursuant to this clause (l) or Sections 1.07(c) or (f) in any Test Period that are included in Consolidated EBITDA for such Test Period shall not

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exceed 20% of Consolidated EBITDA for such Test Period (in each case, calculated before giving effect to any such adjustment); provided, further, that, for the purpose of this clause (l), (i) any such adjustments shall be added to Consolidated EBITDA for each Test Period until fully realized and shall be calculated on a pro forma basis as though such adjustments had been realized on the first day of the relevant Test Period and shall be calculated net of the amount of actual benefits realized from such actions, (ii) any such adjustments shall be reasonably identifiable and factually supportable and (iii) no such adjustments shall be added pursuant to this clause (l) to the extent duplicative of any items related to adjustments included in the definition of Consolidated Net Income or pursuant to the effects of Section 1.07 (it being understood that for purposes of the foregoing and Section 1.07 “run rate” shall mean the full recurring benefit that is associated with any such action); plus

(m) [reserved];

(n) non-cash charges related to stock compensation expense and non-cash pension expenses determined in accordance with GAAP; plus

(o) management fees paid to the Permitted Holders and other management, monitoring, consulting and advisory fees and related expenses paid directly by the Borrowers or any Restricted Subsidiary pursuant to Section 6.12(b)(xii); plus

(p) losses on asset sales (other than asset sales in the ordinary course of business) and losses from the early extinguishment of Indebtedness or hedging obligations or other derivative instruments; plus

(q) to the extent not already included in items (a) through (p) above, extraordinary losses (or minus the amount of any gains related thereto) and unusual or non-recurring charges (or minus the amount of any gains related thereto) (including, but not limited to, impairment losses, cost of debt retirement, restructuring, severance, relocation costs and one-time compensation charges); and

(2) decreased by (without duplication): non-cash gains increasing Consolidated Net Income of the Canadian Borrower and the Restricted Subsidiaries for such period, excluding any items which represent the reversal of any accrual of, or cash reserve for, anticipated cash charges in any prior period, and including gains on asset sales (other than asset sales in the ordinary course of business) and gains from the early extinguishment of Indebtedness or hedging obligations or other derivative instruments;

(3) increased or decreased by any net non-cash loss or gain resulting from Swap Obligations and, other than for purposes of calculating the Applicable Amount, any cash loss or gain resulting from Swap Obligations;

(4) increased or decreased by any non-cash loss or gain on changes in fair value of financial instruments and non-cash loss or gains resulting from changes in foreign exchange rates;

in each case, as determined on a consolidated basis for the Canadian Borrower and the Restricted Subsidiaries in accordance with GAAP, provided that

(i) there shall be excluded from Consolidated Net Income and the determination of Consolidated EBITDA for any period the effects of significant changes in accounting or reporting principles or practices since the Measurement Date; provided that, notwithstanding the foregoing, to the extent the functional or presentation currency is changed, any related effects shall not be excluded; and

(ii) [reserved];

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(iii) there shall be excluded from Consolidated Net Income and the determination of Consolidated EBITDA for any period the effects of adjustments in component amounts required or permitted by ASC 805, ASC 350 and related or similar authoritative pronouncements pursuant to IFRS, as a result of an acquisition of assets, capital stock or other equity interest by the Canadian Borrower or any Restricted Subsidiary in accordance with the terms of this Agreement or the amortization or write-off of any amounts in connection therewith and related financings thereof; and

(iv) (x) there shall be included in determining Consolidated EBITDA for any period the Acquired EBITDA of any Person, property, business or asset (other than an Unrestricted Subsidiary) acquired to the extent not subsequently sold, transferred or otherwise disposed of (but not including the Acquired EBITDA of any related Person, property, business or assets to the extent not so acquired) by the Canadian Borrower or any Restricted Subsidiary during such period (each such Person, property, business or asset acquired and not subsequently so disposed of, an “Acquired Entity or Business”), and the Acquired EBITDA of any Unrestricted Subsidiary that is converted into a Restricted Subsidiary during such period (each, a “Converted Restricted Subsidiary”), in each case based on the actual Acquired EBITDA of such Acquired Entity or Business or Converted Restricted Subsidiary for such period (including the portion thereof occurring prior to such acquisition or conversion) and (y) for purposes of determining the Total Leverage Ratio, the First Lien Leverage Ratio and the Senior Secured Leverage Ratio, there shall be excluded in determining Consolidated EBITDA for any period the Disposed EBITDA of any Person, property, business or asset (other than an Unrestricted Subsidiary) sold, transferred or otherwise disposed of, closed or classified as discontinued operations by the Canadian Borrower or any Restricted Subsidiary during such period (each such Person, property, business or asset so sold or disposed of, a “Sold Entity or Business”), and the Acquired EBITDA of any Restricted Subsidiary that is converted into an Unrestricted Subsidiary during such period (each, a “Converted Unrestricted Subsidiary”), in each case based on the actual Acquired EBITDA of such Sold Entity or Business or Converted Unrestricted Subsidiary for such period (including the portion thereof occurring prior to such sale, transfer, disposition or conversion); and

(v) (i) except as provided in clause (iv) above, there shall be excluded from Consolidated EBITDA for any period the income or loss from continuing operations before income taxes and extraordinary items of all Unrestricted Subsidiaries for such period to the extent otherwise included in Consolidated Net Income, except to the extent any such income is actually received in cash by the Canadian Borrower or its Restricted Subsidiaries or such losses funded by the Canadian Borrower or a Restricted Subsidiary in cash, in each case during such period through dividends or other distributions and (ii) to the extent not covered in (i) above, there shall be included in calculating Consolidated EBITDA, the amount of any cash dividends or other cash distributions paid by any Unrestricted Subsidiary or joint venture to the Canadian Borrower or any Restricted Subsidiary.

“Consolidated First Lien Secured Debt” shall mean all Consolidated Total Secured Debt secured by a Lien that is not subordinated in lien priority to the Liens on the Collateral securing the Obligations.

“Consolidated Income Tax Expense” shall mean, with respect to the Canadian Borrower and the Restricted Subsidiaries for any period, the provision for federal, state, local and foreign taxes based on income or profits (including franchise taxes) payable by the Canadian Borrower and the Restricted Subsidiaries for such period as determined on a consolidated basis in accordance with GAAP.

“Consolidated Interest Expense” shall mean, for any period, the cash interest expense (including that attributable to Finance Lease Obligations in accordance with GAAP), net of cash interest income earned on cash and Cash Equivalents, of the Canadian Borrower and the Restricted Subsidiaries on a consolidated basis with respect to all outstanding Indebtedness of the Canadian Borrower and the Restricted Subsidiaries, including all commissions, discounts and other fees and charges owed with respect to letters of credit and bankers’ acceptance financing and all income or costs under Swap Agreements (other than currency swap agreements, currency future or option contracts and other similar agreements unrelated to interest expense) and any cash dividends paid on any Disqualified Capital Stock and including, without duplication, capitalized interest in connection with the purchase of Satellites to the extent paid in cash and interest expense related to Satellite performance incentive payments, but excluding, however, amortization of deferred financing costs and any other amounts of non-cash interest, all as calculated on a

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consolidated basis in accordance with GAAP and excluding, for avoidance of any doubt, any interest in respect of items excluded from Indebtedness in the proviso to the definition thereof; provided that there shall be excluded from Consolidated Interest Expense for any period the cash interest expense (or cash interest income earned on cash and Cash Equivalents) of all Unrestricted Subsidiaries for such period to the extent otherwise included in Consolidated Interest Expense. For purposes of this definition, interest on a Finance Lease Obligation shall be deemed to accrue at an interest rate reasonably determined by such Person to be the rate of interest implicit in such Finance Lease Obligation in accordance with GAAP.

“Consolidated Lease Expense” shall mean, for any period, all rental expenses of the Canadian Borrower and the Restricted Subsidiaries during such period in respect of Non-Finance Lease Obligations for real or personal property (including in connection with Sale Leasebacks), excluding real estate taxes, insurance costs and common area maintenance charges and net of sublease income, other than (a) obligations under vehicle leases entered into in the ordinary course of business, (b) all such rental expenses associated with assets acquired pursuant to a Permitted Acquisition to the extent that such rental expenses relate to Non-Finance Lease Obligations in effect at the time of (and immediately prior to) such acquisition and (c) Finance Lease Obligations, all as determined on a consolidated basis in accordance with GAAP; provided that there shall be excluded from Consolidated Lease Expense for any period the rental expenses of all Unrestricted Subsidiaries for such period to the extent otherwise included in Consolidated Lease Expense.

“Consolidated Net Income” shall mean, for any period, the consolidated net income (or loss) after the deduction of income taxes of the Canadian Borrower and the Restricted Subsidiaries, determined on a consolidated basis in accordance with GAAP.

“Consolidated Total Debt” shall mean, as of any date of determination, the sum of (i) all Indebtedness of the Canadian Borrower and the Restricted Subsidiaries for borrowed money (adjusted (up or down) for the effects of currency swap agreements) outstanding on such date and (ii) all Finance Lease Obligations of the Canadian Borrower and the Restricted Subsidiaries outstanding on such date, all calculated on a consolidated basis in accordance with GAAP.

“Consolidated Total Secured Debt” shall mean all Consolidated Total Debt secured by a Lien on property or assets of the Canadian Borrower or a Restricted Subsidiary.

“Consolidated Working Capital” shall mean, at any date, the excess of (a) the sum of all amounts (other than cash, cash equivalents and bank overdrafts) that would, in conformity with GAAP, be set forth opposite the caption “total current assets” (or any like caption) on a consolidated balance sheet of the Canadian Borrower and the Restricted Subsidiaries at such date over (b) the sum of all amounts that would, in conformity with GAAP, be set forth opposite the caption “total current liabilities” (or any like caption) on a consolidated balance sheet of the Canadian Borrower and the Restricted Subsidiaries on such date, but excluding (i) the current portion of any Funded Debt, (ii) without duplication of clause (i) above, all Indebtedness consisting of Loans and Letter of Credit Exposure to the extent otherwise included therein and (iii) the current portion of deferred income taxes.

“Consulting Services Agreement” means the Consulting Services Agreement between Loral and the Canadian Borrower as amended from time to time.

“Contract” shall have the meaning provided in the definition of “Subject Property.”

“Control” shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a person, whether through the ownership of voting securities, by contract or otherwise, and “Controlling” and “Controlled” shall have meanings correlative thereto.

“Converted Restricted Subsidiary” shall have the meaning provided in the definition of the term “Consolidated EBITDA.”

“Converted Unrestricted Subsidiary” shall have the meaning provided in the definition of the term “Consolidated EBITDA.”

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“Corresponding Tenor” with respect to ~~a Benchmark Replacement means~~any Available Tenor shall mean, as applicable, either a tenor (including overnight) or an interest payment period having approximately the same length (disregarding business day adjustment) as ~~theapplicable tenor for the applicable Interest Period with respect to the LIBO Rate~~such Available Tenor.

“Covered Entity” means any of the following:

(i) a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b);

(ii) a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or

(iii) a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).

“Covered Party” has the meaning assigned to it in Section 9.26.

“Credit Agreement Refinancing Indebtedness” shall mean (a) Permitted Equal Priority Refinancing Debt, (b) Permitted Junior Priority Refinancing Debt or (c) Permitted Unsecured Refinancing Debt; provided that, in each case, such Indebtedness is incurred to Refinance, in whole or in part, existing Term Loans or existing Revolving R-3 Facility Loans (or unused Revolving R-3 Facility Commitments), any then-existing Extended Revolving Credit Loans (or unused Extended Revolving Credit Commitments), or any Loans under any then-existing Incremental Facility (or, if applicable, unused Commitments thereunder), or any then-existing Credit Agreement Refinancing Indebtedness (“Refinanced Debt”); provided, further, that (i) except for any of the following that are only applicable to periods after the Final Maturity Date, the covenants, events of default and guarantees of such Indebtedness (excluding, for the avoidance of doubt, interest rates (including through fixed interest rates), interest margins, rate floors, fees, funding discounts, original issue discounts, maturity and prepayment or redemption premiums and terms) (when taken as a whole) are determined by the Canadian Borrower to be either (A) consistent with market terms and conditions and conditions at the time of incurrence or effectiveness (as determined by the Canadian Borrower in good faith) or (B) not materially more restrictive on the Canadian Borrower and the Restricted Subsidiaries than those applicable to the Refinanced Debt, when taken as a whole (provided that if the documentation governing such Credit Agreement Refinancing Indebtedness contains a Previously Absent Financial Maintenance Covenant, the Administrative Agent shall be given prompt written notice thereof and this Agreement shall be amended to include such Previously Absent Financial Maintenance Covenant for the benefit of each Facility (provided, however, that if (x) both the Refinanced Debt and the related Credit Agreement Refinancing Indebtedness that includes a Previously Absent Financial Maintenance Covenant consists of a revolving credit facility (whether or not the documentation therefor includes any other facilities) and (y) the applicable Previously Absent Financial Maintenance Covenant is a “springing” financial maintenance covenant for the benefit of such revolving credit facility or a covenant only applicable to, or for the benefit of, a revolving credit facility, the Previously Absent Financial Maintenance Covenant shall only be required to be included in this Agreement for the benefit of each revolving credit facility hereunder (and not for the benefit of any term loan facility hereunder) and such Credit Agreement Refinancing Indebtedness shall not be deemed “more restrictive” solely as a result of such Previously Absent Financial Maintenance Covenant benefiting only such revolving credit facilities; provided that a certificate of a Responsible Officer of the Canadian Borrower delivered to the Administrative Agent at least five Business Days prior to the incurrence of such Indebtedness, together with a reasonably detailed description of the material terms and conditions of such Indebtedness or drafts of the documentation relating thereto, stating that the Canadian Borrower has determined in good faith that such terms and conditions satisfy the foregoing requirement shall be conclusive evidence that such terms and conditions satisfy the foregoing requirement unless the Administrative Agent notifies the Canadian Borrower within such five Business Day period that it disagrees with such determination (including a reasonable description of the basis upon which it disagrees), (ii) any such Indebtedness in the form of bonds, notes or debentures or which Refinances, in whole or in part, existing Term Loans, shall have a maturity that is no earlier than the maturity of the Refinanced Debt and a Weighted Average Life to Maturity equal to or greater than the Refinanced Debt; provided that the foregoing requirements of this clause (ii) shall not apply to the extent such Indebtedness constitutes a customary bridge facility, so long as the long-term Indebtedness into which any such customary bridge facility is to be converted or exchanged satisfies the requirements of this clause (ii) and such conversion or exchange is subject only to conditions customary for similar conversions or exchanges, (iii) any such Indebtedness which Refinances any existing Revolving R-3 Facility Loans (or unused Revolving R-3 Facility Commitments) or any then-existing Extended Revolving Credit Loans (or unused Extended Revolving Credit

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Commitments) shall have a maturity that is no earlier than the maturity of such Refinanced Debt and shall not require any mandatory commitment reductions prior to the maturity of such Refinanced Debt; provided that the foregoing requirements of this clause (iii) shall not apply to the extent such Indebtedness constitutes a customary bridge facility, so long as the long-term Indebtedness into which any such customary bridge facility is to be converted or exchanged satisfies the requirements of this clause (iii) and such conversion or exchange is subject only to conditions customary for similar conversions or exchanges, (iv) except to the extent otherwise permitted under this Agreement (subject to a dollar for dollar usage of any other basket set forth in Section 6.01, if applicable), such Indebtedness shall not have a greater principal amount (or shall not have a greater accreted value, if applicable) than the principal amount (or accreted value, if applicable) of the Refinanced Debt plus accrued interest, fees and premiums (including tender premiums) (if any) thereon, defeasance costs, underwriting discounts and fees and expenses (including OID, closing payments, upfront fees or similar fees) associated with the Refinancing plus an amount equal to any existing commitments unutilized and letters of credit undrawn, (v) such Refinanced Debt shall be repaid, repurchased, redeemed, defeased, acquired or satisfied and discharged on a dollar-for-dollar basis, and all accrued interest, fees and premiums (including tender premiums) (if any) in connection therewith shall be paid substantially concurrently with the date such Credit Agreement Refinancing Indebtedness is incurred or made effective, (vi) except to the extent otherwise permitted hereunder, the aggregate unused revolving commitments under such Credit Agreement Refinancing Indebtedness shall not exceed the unused Revolving R-3 Facility Commitments or Extended Revolving Credit Commitments, as applicable, being replaced plus undrawn letters of credit, (vii) in the case of any such Indebtedness in the form of bonds, notes or debentures or which Refinances, in whole or in part, existing Term Loans, the terms thereof shall not require any mandatory repayment, redemption, repurchase, acquisition or defeasance (other than (x) in the case of bonds, notes or debentures, customary change of control, asset sale event or casualty, eminent domain or condemnation event offers and customary acceleration any time after an event of default and (y) in the case of any term loans, mandatory prepayments that are on terms (when taken as a whole) not materially more favorable to the lenders or holders providing such Indebtedness than those applicable to the Refinanced Debt (when taken as a whole) prior to the maturity date of the Refinanced Debt, (viii) any Credit Agreement Refinancing Indebtedness may not be guaranteed by any Subsidiaries of the Canadian Borrower that do not guarantee the Obligations and (ix) any Credit Agreement Refinancing Indebtedness may not be secured by any assets that do not secure the Obligations.

“Credit Event” shall have the meaning assigned to such term in Article IV.

“Credit Extension” shall mean a Borrowing or the issuance, renewal, extension (other than an automatic extension pursuant to Section 2.05(c)(iii)) or increase of a Letter of Credit.

“CRTC” shall mean the Canadian Radio-Television and Telecommunications Commission or any successor authority of the Government of Canada substituted therefor.

“Cumulative Interest Expense” shall mean, in respect of any Restricted Payment, the sum of the aggregate amount of Consolidated Interest Expense of the Canadian Borrower and its Restricted Subsidiaries for the period from and after October 1, 2016, to the most recently completed fiscal quarter for which internal financial statements are available immediately preceding such date of determination.

“Cure Amount” shall have the meaning assigned to such term in Section 7.02(a).

“Cure Right” shall have the meaning assigned to such term in Section 7.02(a).

“Custodian” shall have the meaning assigned to such term in Section 8.01(e).

“Customary Intercreditor Agreement” shall mean (a) to the extent executed in connection with the incurrence of secured Indebtedness by a Loan Party, the Liens on the Collateral securing which are intended to rank equal in priority to the Liens on the Collateral securing the Obligations (but without regard to the control of remedies), at the option of the Canadian Borrower and the Collateral Agent acting together in good faith, either (i) any intercreditor agreement substantially in the form of the Equal Priority Intercreditor Agreement or (ii) a customary intercreditor agreement in form and substance reasonably acceptable to the Collateral Agent and the Canadian Borrower, which agreement shall provide that the Liens on the Collateral securing such Indebtedness shall

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rank equal in priority to the Liens on the Collateral securing the Obligations (but without regard to the control of remedies) and (b) to the extent executed in connection with the incurrence of secured Indebtedness by a Loan Party, the Liens on the Collateral securing which are intended to rank junior in priority to the Liens on the Collateral securing the Obligations, at the option of the Canadian Borrower and the Collateral Agent acting together in good faith, either (i) an intercreditor agreement substantially in the form of the Junior Priority Intercreditor Agreement or (ii) a customary intercreditor agreement in form and substance reasonably acceptable to the Collateral Agent and the Canadian Borrower, which agreement shall provide that the Liens on the Collateral securing such Indebtedness shall rank junior in priority to the Liens on the Collateral securing the Obligations.

“Daily Simple SOFR” shall mean, for any day (a “SOFR Rate Day”), a rate per annum equal to SOFR for the day that is five (5) U.S. Government Securities Business Days prior to (i) if such SOFR Rate Day is a U.S. Government Securities Business Day, such SOFR Rate Day or (ii) if such SOFR Rate Day is not a U.S. Government Securities Business Day, the U.S. Government Securities Business Day immediately preceding such SOFR Rate Day, in each case, as such SOFR is published by the SOFR Administrator on the SOFR Administrator’s Website. Any change in Daily Simple SOFR due to a change in SOFR shall be effective from and including the effective date of such change in SOFR without notice to the Canadian Borrower.

“Debt Fund Affiliate” shall mean any Affiliate of the Canadian Borrower (other than the Borrowers or any Restricted Subsidiary) that is primarily engaged in, or advises funds or other investment vehicles that are engaged in, making, purchasing, holding or otherwise investing in commercial loans, bonds and similar extensions of credit or securities in the ordinary course.

“Debt Incurrence Event” shall mean any issuance or incurrence by the Canadian Borrower or any of the Restricted Subsidiaries of any Indebtedness (excluding any Indebtedness permitted to be issued or incurred under Section 6.01 (other than Incremental Term Loans incurred in reliance on clause (i)(x) of the proviso to Section 2.21(b) and, to the extent relating to Term Loans, the incurrence of any Credit Agreement Refinancing Indebtedness)).

“Debtor Relief Laws” shall mean the U.S. Bankruptcy Code, BIA, CCAA and WURA and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief Laws of the United States, Canada or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally.

“Default” shall mean any event or condition that upon notice, lapse of time or both would constitute an Event of Default.

“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable.

“Defaulting Lender” shall mean, subject to Section 2.23(b), at any time, as reasonably determined by the Administrative Agent, a Lender as to which the Administrative Agent has notified the Canadian Borrower that (i) such Lender has failed for two or more Business Days to comply with its obligations under this Agreement to make a Term Loan or Revolving R-3 Facility Loan, make a payment to the L/C Issuer in respect of a L/C Obligation and/or make a payment to the Swingline Lender in respect of a Swingline Loan (each a “Lender Funding Obligation”), in each case, required to be funded hereunder, (ii) such Lender has notified the Administrative Agent, or has stated publicly, that it will not comply with any such Lender Funding Obligation hereunder, or has defaulted on its Lender Funding Obligations under any other loan agreement or credit agreement or other similar agreement in which it commits to extend credit (absent a good faith dispute), (iii) such Lender has, for three or more Business Days, failed to confirm in writing to the Administrative Agent, in response to a written request of the Administrative Agent (based on the reasonable belief that it may not fulfill its Lender Funding Obligations), that it will comply with its Lender Funding Obligations hereunder (absent a good faith dispute); provided that any such Lender shall cease to be a Defaulting Lender under this clause (iii) upon receipt of such confirmation by the Administrative Agent, or (iv) a Lender Insolvency Event or Bail-In Action has occurred and is continuing with respect to such Lender or its Parent Company (provided that neither the reallocation of Lender Funding Obligations provided for in Section 2.23 as a result of a Lender’s being a Defaulting Lender nor the performance by Non-Defaulting Lenders of such reallocated

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Lender Funding Obligations will by themselves cause the relevant Defaulting Lender to become a Non-Defaulting Lender). The Administrative Agent will promptly send to all parties hereto a copy of any notice to the Canadian Borrower provided for in this definition.

“Designated Non-cash Consideration” means the Fair Market Value of non-cash consideration received by the Canadian Borrower or a Restricted Subsidiary in connection with an Asset Sale that is so designated as Designated Non-cash Consideration pursuant to an officer’s certificate, setting forth the basis of such valuation, executed by an executive vice president and the principal financial officer of the Canadian Borrower, less the amount of cash or Cash Equivalents received in connection with a subsequent sale of such Designated Non-cash Consideration.

“Director Voting Preferred Shares” shall mean preferred shares in the Canadian Borrower which have a nominal dividend and return of capital and vote only for the election of directors

“Discount Prepayment Accepting Lender” shall have the meaning given to it in Section 2.12(f)(ii)(B).

“Discount Proceeds” shall mean, for any BA (or, if applicable, any BA Equivalent Loan), an amount (rounded to the nearest whole cent, and with one-half of one cent being rounded upwards) calculated by dividing (a) the face amount of the BA (or, if applicable, the BA Equivalent Loan) by (b) the sum of one plus the product of: (i) the BA Discount Rate (expressed as a decimal) applicable to such BA (or, if applicable, such BA Equivalent Loan), and (ii) a fraction, the numerator of which is the BA Contract Period of the BA (or, if applicable, the BA Equivalent Loan) and the denominator of which is 365 or 366 days, as applicable, with such quotient being rounded up or down to the fifth decimal place and 0.000005 being rounded upward.

“Discount Range” shall have the meaning given to it in Section 2.12(f)(iii)(A).

“Discount Range Prepayment Amount” shall have the meaning given to it in Section 2.12(f)(iii)(A).

“Discount Range Prepayment Notice” shall mean a written notice of a Borrower Solicitation of Discount Range Prepayment Offers made pursuant to Section 2.12(f)(iii) substantially in the form of Exhibit N-2.

“Discount Range Prepayment Offer” shall mean the irrevocable written offer by a Lender, substantially in the form of Exhibit N-3, submitted in response to an invitation to submit offers following the Auction Agent’s receipt of a Discount Range Prepayment Notice.

“Discount Range Prepayment Response Date” shall have the meaning given to it in Section 2.12(f)(iii)(A).

“Discount Range Proration” shall have the meaning given to it in Section 2.12(f)(iii)(C).

“Discounted Prepayment Determination Date” shall have the meaning given to it in Section 2.12(f)(iv)(C).

“Discounted Prepayment Effective Date” shall mean in the case of a Borrower Offer of Specified Discount Prepayment, Borrower Solicitation of Discount Range Prepayment Offer or Borrower Solicitation of Discounted Prepayment Offer, five (5) Business Days following the Specified Discount Prepayment Response Date, the Discount Range Prepayment Response Date or the Solicited Discounted Prepayment Response Date, as applicable, in accordance with Section 2.12(f)(ii)(A), Section 2.12(f)(iii)(A) or Section 2.12(f)(iv)(A), respectively, unless a shorter period is agreed to between the Borrower and the Auction Agent.

“Discounted Term Loan Prepayment” shall have the meaning given to it in Section 2.12(f)(i).

“Disposed EBITDA” shall mean, with respect to any Sold Entity or Business or Converted Unrestricted Subsidiary for any period, the amount for such period of Consolidated EBITDA of such Sold Entity or Business or Converted Unrestricted Subsidiary (determined as if references to the Canadian Borrower and the Restricted Subsidiaries in the definition of the term “Consolidated EBITDA” (and in the component financial definitions used

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therein) were references to such Sold Entity or Business and its Subsidiaries or to such Converted Unrestricted Subsidiary and its Subsidiaries), all as determined on a consolidated basis for such Sold Entity or Business.

“Disqualified Capital Stock” means, with respect to any Person, any Capital Stock of such Person which, by its terms, or by the terms of any security into which it is convertible or for which it is putable or exchangeable, or upon the happening of any event, matures or is mandatorily redeemable, other than as a result of a change of control or asset sale, pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the holder thereof, other than as a result of a change of control or asset sale, in whole or in part, in each case prior to the date 91 days after the earlier of the Final Maturity Date or the date the Loans are no longer outstanding; provided, however, that if such Capital Stock is issued to any plan for the benefit of employees of the Canadian Borrower or its Subsidiaries or by any such plan to such employees, such Capital Stock shall not constitute Disqualified Capital Stock solely because it may be required to be repurchased by the Canadian Borrower or its Subsidiaries in order to satisfy applicable statutory or regulatory obligations.

“Disqualified Lender” shall mean (A) those Persons separately identified as “disqualified lenders” in a posting to all Lenders as of the Amendment No. 6 Effective Date, (B) those Persons who are competitors of the Canadian Borrower that are separately identified in writing by the Canadian Borrower and posted to all Lenders from time to time and (C) any Affiliate (other than a bona fide debt fund that is primarily engaged in or that advises funds or other investment vehicles that are engaged in making, purchasing, holding or otherwise investing in commercial loans, bonds or similar extensions of credit or securities in the ordinary course) of a Person identified pursuant to clause (A) or (B) above that is either (x) identified in writing by the Canadian Borrower and posted to all Lenders from time to time or (y) clearly identifiable as an Affiliate of such Person solely on the basis of such Affiliate’s name; provided that, notwithstanding anything herein to the contrary, (i) in no event shall being identified as a Disqualified Lender retroactively disqualify any parties that have previously acquired an assignment hereunder that is otherwise permitted from becoming a Lender and (ii) if the Canadian Borrower provides written consent to assignment to an entity identified as a Disqualified Lender, such entity will not be considered a Disqualified Lender for the purpose of such assignment.

“Dividend Obligations” shall mean obligations of the Canadian Borrower to a shareholder (which, for the avoidance of doubt, may be a direct or indirect shareholder) of the Canadian Borrower in connection with the receipt by such shareholder of cash or other assets on account of dividends or distributions on Equity Interests of the Canadian Borrower; provided, however, that (i) the making of such dividend or distribution is permitted by Section 6.06, (ii) such obligations have a final scheduled maturity date of not more than 12 months from the date of incurrence thereof, (iii) such obligations are incurred within 90 days of receipt by such shareholder of such dividend or distribution, (iv) the principal amount of any such obligations shall not exceed the cash or other assets to be received by such shareholder in connection with the applicable dividend or distribution, (v) such obligations are unsecured, are not guaranteed by any Subsidiary of the Canadian Borrower and are subordinated in right of payment to the Obligations, (vi) for the avoidance of doubt, the Applicable Amount shall not be increased by the amount of such obligations, (viii) in no event shall any such obligations be refinanced or reclassified and (ix) such obligations are designated as “Dividend Obligations” pursuant to an officer’s certificate on the date of its incurrence.

“Dollar Equivalent” shall mean, on any date of determination (a) with respect to any amount in Dollars, such amount, and (b) with respect to any amount in Canadian Dollars, the equivalent in Dollars of such amount, determined pursuant to Section 1.03(b) using the Exchange Rate with respect to Canadian Dollars at the time in effect under the provisions of such Section.

“Dollar Letter of Credit” shall mean a Letter of Credit denominated in Dollars.

“Dollars” or “$” shall mean lawful money of the United States of America.

~~“~~~~EarlyOpt-in Election~~~~” means the occurrence of:~~

~~(1) (i)a determination by the Administrative Agent or (ii) a notification by the Required Lenders to the Administrative Agent (with a copy tothe Canadian Borrower) that the Required Lenders have determined that U.S. dollar-denominated syndicated credit facilities being executedat such time, or that include language similar to that~~

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~~contained in Section 2.15 are being executed or amended, as applicable, to incorporate or adopt a newbenchmark interest rate to replace the LIBO Rate, and~~

~~(2) (i) the election by theAdministrative Agent or (ii) the election by the Required Lenders to declare that an Early Opt-in Election has occurred and the provision,as applicable, by the Administrative Agent of written notice of such election to the Canadian Borrower and the Lenders or by the RequiredLenders of written notice of such election to the Administrative Agent.~~

“EEA Financial Institution” shall mean (a) any credit institution or investment firm established in any EEA Member Country that is subject to the supervision of an EEA Resolution Authority, (b) any Person established in an EEA Member Country that is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country that is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

“EEA Member Country” shall mean any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

“EEA Resolution Authority” shall mean any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

“Effective Yield” shall mean, as to any Indebtedness, the effective yield paid by the applicable Borrower on such Indebtedness as determined by the applicable Borrower and the Administrative Agent in a manner consistent with generally accepted financial practices, taking into account the applicable interest rate margins, any interest rate “floors” (the effect of which floors shall be determined in a manner set forth in the proviso below and assuming that, if interest on such Indebtedness is calculated on the basis of a floating rate, that the ~~“LIBOR”~~interest rate benchmark component of such formula is included in the calculation of Effective Yield) or similar devices and all fees, including upfront or similar fees or OID (amortized over the shorter of (x) the remaining Weighted Average Life to Maturity of such Indebtedness and (y) the four years following the date of incurrence thereof) payable generally by the applicable Borrower to Lenders or other institutions providing such Indebtedness, but excluding any arrangement fees, structuring fees, closing payments or other similar fees payable in connection therewith that are not generally shared with the relevant Lenders and, if applicable, ticking fees accruing prior to the funding of such Indebtedness and customary consent fees for an amendment paid generally to consenting Lenders; provided that, with respect to any Indebtedness that includes a “floor”, (a) to the extent that the ~~Reference Rate~~relevant Benchmark on the date that the Effective Yield is being calculated is less than such floor, the amount of such difference shall be deemed added to the interest rate margin for such Indebtedness for the purpose of calculating the Effective Yield and (b) to the extent that the ~~Reference Rate~~relevant Benchmark on the date that the Effective Yield is being calculated is greater than such floor, then the floor shall be disregarded in calculating the Effective Yield.

“Employee Benefit Plan” shall mean an employee benefit plan (as defined in Section 3(3) of ERISA), other than a Non-U.S. Pension Plan, that is maintained by the Canadian Borrower or any Subsidiary, or with respect to an employee benefit plan subject to Title IV of ERISA, any ERISA Affiliate, or with respect to which the Canadian Borrower or any Subsidiary could reasonably be expected to incur liability.

“Environment” shall mean ambient and indoor air, surface water and groundwater (including potable water, navigable water and wetlands), the land surface or subsurface strata, natural resources such as flora and fauna, the workplace or as otherwise defined in any Environmental Law.

“Environmental Claim” shall mean any and all administrative, regulatory or judicial actions, suits, formal demands, demand letters, claims, liens, notices of non-compliance or violation, or potential responsibility for investigations or proceedings relating in any way to any Environmental Law or any permit issued, or any approval given, under any such law, including, (a) by governmental or regulatory authorities for enforcement, cleanup, removal, response, remedial or other actions or damages pursuant to any Environmental Law, and (b) by any third party seeking damages, contribution, indemnification, cost recovery, compensation or injunctive relief in connection with alleged injury or threat of injury to health, safety or the environment due to the presence of or exposure to Hazardous Materials.

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“Environmental Laws” shall mean all applicable laws (including common law), rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions, guidelines or binding agreements issued, promulgated or entered into by any Governmental Authority, relating in any way to the protection of the Environment, preservation or reclamation of natural resources, the generation, management, Release or threatened Release of, or exposure to, any Hazardous Material or to health and safety matters (to the extent relating to the Environment or exposure to Hazardous Materials).

“Equal Priority Intercreditor Agreement” shall mean the Equal Priority Intercreditor Agreement substantially in the form of Exhibit M-1 among (x) the Collateral Agent and (y) one or more representatives of the holders of one or more classes of Permitted Additional Debt and/or Permitted Equal Priority Refinancing Debt, with any immaterial changes and material changes thereto in light of the prevailing market conditions, which material changes shall be posted to the Lenders not less than five Business Days before execution thereof and, if the Required Lenders shall not have objected to such changes within five Business Days after posting, then the Required Lenders shall be deemed to have agreed that the Administrative Agent’s and/or Collateral Agent’s entry into such intercreditor agreement (with such changes) is reasonable and to have consented to such intercreditor agreement (with such changes) and to the Administrative Agent’s and/or Collateral Agent’s execution thereof.

“Equity Interests” means Capital Stock and all warrants, options or other rights to acquire Capital Stock, but excluding any debt security that is convertible into, or exchangeable for, Capital Stock.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as the same may be amended from time to time.

“ERISA Affiliate” shall mean any trade or business (whether or not incorporated) that, together with the Borrowers or a Subsidiary, is treated as a single employer under Section 414(b) or (c) of the Code, or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.

“ERISA Event” shall mean (a) any Reportable Event; (b) with respect to any Plan, the failure to satisfy the minimum funding standard of Section 412 of the Code or Section 302 of ERISA, whether or not waived; (c) the filing pursuant to Section 412(c) of the Code or Section 302(c) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan, the failure to make by its due date the minimum required contribution under Section 430(j) of the Code with respect to any Plan or the failure to make any required contribution to a Multiemployer Plan; (d) a determination that any Plan is, or is expected to be, in “at-risk” status (as defined in Section 303(i)(4) of ERISA or Section 430(i)(4) of the Code); (e) the incurrence by the Canadian Borrower, a Subsidiary or any ERISA Affiliate of any liability under Title IV of ERISA with respect to the termination of any Plan; (f) the receipt by the Canadian Borrower, a Subsidiary or any ERISA Affiliate from the PBGC or a plan administrator of any notice relating to an intention to terminate any Plan or the occurrence of any event or condition which could reasonably be expected to constitute grounds under ERISA for the termination of or the appointment of a trustee to administer any Plan; (g) the incurrence by the Canadian Borrower, a Subsidiary or any ERISA Affiliate of any liability under Title IV of ERISA with respect to the complete or partial withdrawal from any Plan or Multiemployer Plan; (h) the receipt by the Canadian Borrower, a Subsidiary or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from the Canadian Borrower, a Subsidiary or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent, within the meaning of Title IV of ERISA or in “endangered” or “critical” status (within the meaning of Section 432 of the Code or Section 305 of ERISA); or (i) the substantial cessation of operations within the meaning of Section 4062(e) of ERISA with respect to a Plan; or (j) the occurrence of a nonexempt prohibited transaction (within the meaning of Section 4975 of the Code or Section 406 of ERISA) which could reasonably to be expect to result in liability to the Canadian Borrower, a Subsidiary or any ERISA Affiliate.

“EU Bail-In Legislation Schedule” shall mean the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.

~~“~~~~EurodollarBorrowing~~~~” shall mean a Borrowing comprised of Eurodollar Loans.~~

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~~“~~~~EurodollarLoan~~~~” shall mean any Eurodollar Term Loan or Eurodollar Revolving Loan.~~

~~“~~~~EurodollarRevolving Borrowing~~~~” shall mean a Borrowing comprised of Eurodollar Revolving Loans.~~

~~“~~~~EurodollarRevolving Loan~~~~” shall mean any Revolving R-3 Facility Loan bearing interest at a rate determined by referenceto the Adjusted LIBO Rate in accordance with the provisions of Article II.~~

~~“~~~~EurodollarTerm Loan~~~~” shall mean any Term Loan bearing interest at a rate determined by reference to the Adjusted LIBORate in accordance with the provisions of Article II.~~

“Event of Default” shall have the meaning assigned to such term in Section 7.01.

“Excess Cash Flow” shall mean, for any period, an amount equal to the excess of

(a) the sum, without duplication, of

(i) Consolidated Net Income for such period,

(ii) an amount equal to the amount of all non-cash charges to the extent deducted in arriving at such Consolidated Net Income,

(iii) decreases in Consolidated Working Capital, decreases in long-term accounts receivable in each case as of the end of such period from the Consolidated Working Capital and long-term accounts receivable as of the beginning of such period (except, in the case of each of the foregoing, any such increases or decreases that are as a result of the reclassification of items from short-term to long-term or vice versa) (other than any such decreases or increases, as applicable, arising from acquisitions, sales, leases, transfers or other dispositions outside the ordinary course of assets by the Canadian Borrower or any of its Restricted Subsidiaries completed during such period or the application of recapitalization or purchase accounting), and

(iv) an amount equal to the aggregate net non-cash loss on the sale, lease, transfer or other disposition of assets by the Canadian Borrower and the Restricted Subsidiaries during such period (other than sales, leases, transfers or other dispositions in the ordinary course of business) to the extent deducted in arriving at such Consolidated Net Income,

(v) cash payments received in respect of Swap Agreements during such period to the extent not included in arriving at such Consolidated Net Income, and

(vi) income tax expense to the extent deducted in arriving at such Consolidated Net Income, less

(b) the sum, without duplication, of

(i) an amount equal to the amount of all non-cash credits included in arriving at such Consolidated Net Income (but excluding any non-cash credit to the extent representing the reversal of an accrual or reserve described in clause (a)(ii) above),

(ii) $35,000,000 less the principal amount of Indebtedness incurred in such period in connection with Capital Expenditures,

(iii) the aggregate amount of all prepayments of Revolving R-3 Facility Loans and Swingline Loans made during such period to the extent accompanying reductions of the Revolving R-3 Facility Commitments, except to the extent financed with the proceeds of other Indebtedness of the Canadian Borrower or its Restricted Subsidiaries,

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(iv) the aggregate amount of all principal payments of Indebtedness of the Canadian Borrower or the Restricted Subsidiaries (including any Term Loans and the principal component of payments in respect of Finance Lease Obligations) made during such period or (without duplication) scheduled to be made in the following fiscal year (provided that any such scheduled amounts that are deducted from Excess Cash Flow may not be deducted again from Excess Cash Flow when actually paid) (other than in respect of any revolving credit facility to the extent there is not an equivalent permanent reduction in commitments thereunder), except to the extent financed with the proceeds of other Indebtedness of the Canadian Borrower or its Restricted Subsidiaries,

(v) an amount equal to the aggregate net non-cash gain on the sale, lease, transfer or other disposition of assets by the Canadian Borrower and the Restricted Subsidiaries during such period (other than sales, leases in the ordinary course of business) to the extent included in arriving at such Consolidated Net Income,

(vi) increases in Consolidated Working Capital and long-term receivables in each case as of the end of such period from the Consolidated Working Capital and long-term receivable as of the beginning of such period (except, in the case of each of the foregoing, any such increases or decreases that are as a result of the reclassification of items from short-term to long-term or vice versa) (other than any such increases or decreases, as applicable, arising from acquisitions, sales, leases, transfers or other dispositions outside the ordinary course by the Canadian Borrower and the Restricted Subsidiaries during such period or the application of recapitalization or purchase accounting),

(vii) payments by the Canadian Borrower and the Restricted Subsidiaries during such period in respect of long-term liabilities of the Canadian Borrower and the Restricted Subsidiaries other than Indebtedness,

(viii) the amount of Investments made during such period pursuant to Section 6.06 and Permitted Investments made during such period, in each case, to the extent that such Investments were financed with internally generated cash flow of the Canadian Borrower and the Restricted Subsidiaries,

(ix) the amount of dividends paid during such period pursuant to clause (b), (d) or (m) of Section 6.06, except to the extent financed with the proceeds of other Indebtedness of the Canadian Borrower or its Restricted Subsidiaries,

(x) the aggregate amount of expenditures actually made by the Canadian Borrower and the Restricted Subsidiaries in cash during such period (including expenditures for the payment of financing fees) to the extent that such expenditures are not expensed during such period plus an amount specified by the Canadian Borrower that is not in excess of the amount contracted for Capital Expenditures for the following fiscal year, provided that expenditures during such period that were deducted in the calculation of Excess Cash Flow for any prior period shall not be again deducted,

(xi) the aggregate amount of any premium, make-whole or penalty payments actually paid in cash by the Canadian Borrower and the Restricted Subsidiaries during such period that are required to be made in connection with any prepayment of Indebtedness,

(xii) the amount of Taxes paid or estimated to be paid during such period, and

(xiii) cash expenditures made in respect of Swap Obligations.

“Excess Cash Flow Period” shall mean each fiscal year of the Canadian Borrower, commencing with the fiscal year ending December 31, 2017.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

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“Exchange Rate” shall mean on any day, for purposes of determining the Dollar Equivalent or Canadian Dollar Equivalent of any other currency, the rate at which such other currency may be exchanged into Dollars or Canadian Dollars (as applicable), last provided (either by publication or otherwise provided to the Administrative Agent) by the applicable Thomson Reuters Corp., Refinitiv, or any successor thereto (“Reuters”) source on the Business Day (New York City time) immediately preceding the date of determination. In the event that such rate ceases to be available, the Exchange Rate shall be determined by reference to such other publicly available information service which provides that rate of exchange at such time in place of Reuters chosen by the Administrative Agent in its sole discretion (or if such service ceases to be available or ceases to provide such rate of exchange, the equivalent of such amount in Dollars or Canadian Dollars (as applicable) as determined by the Administrative Agent using any method of determination it deems appropriate in its sole discretion).

“Excluded APT Elements” shall have the meaning given to it in Section 5.10(e).

“Excluded Contribution” means net cash proceeds, marketable securities or Qualified Proceeds received by the Canadian Borrower from (a) contributions to its common equity capital, and (b) the sale (other than to a Subsidiary of the Canadian Borrower or to any management equity plan or stock option plan or any other management or employee benefit plan or agreement of the Canadian Borrower) of Capital Stock (other than Disqualified Capital Stock) of Canadian Borrower, in each case designated as Excluded Contributions pursuant to an officer’s certificate executed by a vice president and the principal financial officer of the Canadian Borrower on the date such capital contributions are made or the date such Equity Interests are sold, as the case may be, which are excluded from the calculation set forth in the definition of the term “Applicable Amount.”

“Excluded Foreign Subsidiary” shall have the meaning given to it in Section 5.10(e).

“Excluded Satellites” shall mean (a) the Satellites owned by the Canadian Borrower and its Restricted Subsidiaries commonly referred to as Anik F1, Anik F1R, Nimiq 1, Nimiq 2, Telstar 12, Telstar 14R and the transponders for which the Canadian Borrower or its Restricted Subsidiaries have a right to use on Eutelsat 113West A, (b) any other Satellite, other than a Named Satellite, that (i) is not expected or intended, in the good faith determination of the Canadian Borrower to earn future revenues from the operation of such Satellite in excess of $35,000,000 in any fiscal year and (ii) has a book value of less than $75,000,000, (c) any other Satellite, other than a Named Satellite, with one year or less of in-orbit life remaining (it being understood and agreed that such Satellite shall be deemed to have “in-orbit life” only for so long as it is maintained in station kept orbit), and (d) any other Satellite that, in the good faith determination of the Canadian Borrower (i)(A) the procurement of In-Orbit Insurance therefor in the amounts and on the terms required hereby would not be available for a price that is, and on other terms and conditions that are, commercially reasonable or (B) the procurement of such In-Orbit Insurance therefor would be subject to exclusions or limitations of coverage that would make the terms of the insurance commercially unreasonable (including because such Satellite’s performance and/or operating status has been adversely affected by anomalies or component exclusions or there are systemic failures or anomalies applicable to Satellites of the same model).

“Excluded Swap Obligation” shall mean, with respect to any Guarantor, (a) any Swap Obligation if, and to the extent that, all or a portion of the guarantee of such Guarantor pursuant to the Guarantee of, or the grant by such Guarantor of a security interest to secure, such Swap Obligation (or any guarantee pursuant to the Guarantee thereof) is or becomes illegal or unlawful under the Commodity Exchange Act or any rule, regulation, or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) (i) by virtue of such Guarantor’s failure to constitute an “eligible contract participant,” as defined in the Commodity Exchange Act and the regulations thereunder (determined after giving pro forma effect to any applicable keep well, support, or other agreement for the benefit of such Guarantor and any and all applicable guarantees of such Guarantor’s Swap Obligations by other Loan Parties), at the time the guarantee of (or grant of such security interest by, as applicable) such Guarantor becomes or would become effective with respect to such Swap Obligation or (ii) in the case of a Swap Obligation that is subject to a clearing requirement pursuant to section 2(h) of the Commodity Exchange Act, because such Guarantor is a “financial entity,” as defined in section 2(h)(7)(C) of the Commodity Exchange Act, at the time the guarantee of (or grant of such security interest by, as applicable) such Guarantor becomes or would become effective with respect to such Swap Obligation or (b) any other Swap Obligation designated as an “Excluded Swap Obligation” of such Guarantor as specified in any agreement between the relevant Loan Parties and Swap

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Counterparty applicable to such Swap Obligations. If a Swap Obligation arises under a master agreement governing more than one swap within the meaning of Section 1a(47) of the Commodity Exchange Act, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to the swap for which such guarantee or security interest is or becomes excluded in accordance with the first sentence of this definition.

“Excluded Taxes” shall mean, with respect to the Administrative Agent, any Lender, any Swingline Lender, any L/C Issuer or any other recipient of any payment to be made by or on account of any obligation of a Loan Party under any Loan Document, (a) any income, capital or franchise Taxes imposed on (or measured by) its net income (however denominated) and branch profits Tax or any similar Tax, in each case, (i) imposed as a result of such recipient being organized under the laws of, or having its principal office located or, in the case of any Lender, having its Applicable Lending Office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) any Canadian withholding Taxes imposed on a payment by or on account of any obligation of a Loan Party hereunder to a person with which the Loan Party does not deal at arm’s length (for the purposes of the Income Tax Act (Canada)) at the time of making such payment (other than where the non-arm’s length relationship arises in connection with or as a result of the recipient having become a party to, received or perfected a security interest under or received or enforced any rights under, a Loan Document), (c) any Canadian withholding Taxes imposed on a recipient by reason of such recipient: (i) being a “specified shareholder” (as defined in subsection 18(5) of the Income Tax Act (Canada)) of any Loan Party, or (ii) not dealing at arm’s length (for purposes of the Income Tax Act (Canada) with a “specified shareholder” of any Loan Party, other than, in both cases, where the recipient is a “specified shareholder” or does not deal at arm’s length with a “specified shareholder”, in connection with or as a result of the recipient having become a party to, received or perfected a security interest under or received or enforced any rights under, a Loan Document), (d) Taxes attributable to such recipient’s failure to comply with Section 2.18(e) and (e) any U.S. federal withholding Taxes imposed under FATCA.

“Executive Order” shall mean Executive Order 13224 of September 21, 2001 Blocking Property and Prohibiting Transactions with Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg. 49079) (2001).

“Existing Class” shall mean Existing Term Loan Classes and each Class of Existing Revolving Credit Commitments.

“Existing Debt Refinancing” shall mean (i) the repayment of the Term B-4 Loans on the Amendment No. 6 Effective Date, and (ii) the repayment of the Revolving R-2 Facility Loans.

“Existing Indebtedness” means Indebtedness of the Canadian Borrower or the Restricted Subsidiaries in existence on the Measurement Date, plus interest accruing thereon.

“Existing Letters of Credit” shall mean the letters of credit listed on Schedule 2.05.

“Existing Revolving Credit Class” shall have the meaning assigned to such term in Section 2.24(b).

“Existing Revolving Credit Commitment” shall have the meaning assigned to such term in Section 2.24(b).

“Existing Revolving Credit Loans” shall have the meaning assigned to such term in Section 2.24(b).

“Existing Term Loan Class” shall have the meaning assigned to such term in Section 2.24(a).

“Export Financing” shall have the meaning assigned to such term in Section 2.21(c)(i).

“Extended Loans/Commitments” shall mean Extended Term Loans, Extended Revolving Credit Loans and/or Extended Revolving Credit Commitments.

“Extended Revolving Credit Commitments” shall have the meaning assigned to such term in Section 2.24(b).

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“Extended Revolving Credit Loans” shall have the meaning assigned to such term in Section 2.24(b).

“Extended Term Loans” shall have the meaning assigned to such term in Section 2.24(a).

“Extending Lender” shall have the meaning assigned to such term in Section 2.24(c).

“Extension Agreement” shall have the meaning assigned to such term in Section 2.24(d).

“Extension Date” shall have the meaning assigned to such term in Section 2.24(e).

“Extension Election” shall have the meaning assigned to such term in Section 2.24(c).

“Extension Request” shall mean a Revolving Credit Extension Request or a Term Loan Extension Request, as applicable.

“Extension Series” shall mean all Extended Term Loans or Extended Revolving Credit Commitments (as applicable) that are established pursuant to the same Extension Agreement (or any subsequent Extension Agreement to the extent such Extension Agreement expressly provides that the Extended Term Loans or Extended Revolving Credit Commitments, as applicable, provided for therein are intended to be a part of any previously established Extension Series) and that provide for the same interest margins, extension fees, if any, and amortization schedule.

“Facility” shall mean the respective facility and commitments utilized in making Loans and credit extensions hereunder, it being understood that as of the Amendment No. 6 Effective Date there are two Facilities, i.e., the Term B-5 Loan Facility and the Revolving R-3 Facility.

“Fair Market Value” means, with respect to any asset or property, as determined by the Canadian Borrower, the price which could be negotiated in an arm’s length, free market transaction, for cash, between a willing seller and a willing and able buyer, neither of whom is under undue pressure or compulsion to complete the transaction.

“FATCA” shall mean Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof, any agreements entered into pursuant to Section 1471(b)(1) of the Code as of the date of this Agreement (or any amended or successor version described above), any intergovernmental agreement (and any fiscal or regulatory legislation, law, regulation, rule or official administrative practices) implementing any of the foregoing.

“FCC” shall mean the Federal Communications Commission or any governmental authority in the United States substituted therefor.

“FCC Licenses” shall mean all authorizations, orders, licenses and permits issued by the FCC to the Canadian Borrower or any of its Subsidiaries.

“Federal Funds Effective Rate” shall mean, for any day, the weighted average (rounded upward, if necessary, to the next 1/100 of 1%) of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by 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 which is a Business Day, the average (rounded upward, if necessary, to the next 1/100 of 1%) 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 Letter” shall mean the Fee Letter, dated March 14, 2012, by and among Canadian Borrower and the Administrative Agent.

“Fees” shall mean the Revolving R-3 Facility Commitment Fees, Acceptance Fees, the L/C Participation Fees, the L/C Issuer Fees and the Agent Fees.

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“Final Maturity Date” shall mean the date which is the latest to occur of the Term B-5 Loan Maturity Date, the latest Incremental Maturity Date and the Revolving R-3 Facility Maturity Date.

“Finance Lease Obligation” shall mean, as applied to any Person, an obligation that is required to be accounted for as a financing or capital lease (and, for the avoidance of doubt, not a straight-line or operating lease) on both the balance sheet and income statement for financial reporting purposes in accordance with GAAP. At the time any determination thereof is to be made, the amount of the liability in respect of a financing or capital lease would be the amount required to be reflected as a liability on such balance sheet (excluding the footnotes thereto) in accordance with GAAP.

“Financial Officer” of any person shall mean the Chief Financial Officer, principal accounting officer, Treasurer, Assistant Treasurer or Controller of such person.

“Financial Performance Covenant” shall mean the covenant of the Canadian Borrower set forth in Section 6.09.

“First Lien Leverage Ratio” shall mean, as of any date of determination, the ratio of (a) Consolidated First Lien Secured Debt as of the last day of the Test Period most recently ended on or prior to such date of determination, minus up to $100,000,000 of cash and Cash Equivalents of the Canadian Borrower and its Restricted Subsidiaries to the extent not designated as restricted cash on the consolidated balance sheet of the Canadian Borrower and its Restricted Subsidiaries in accordance with GAAP to (b) Consolidated EBITDA for such Test Period.

“First Lien Obligations” shall mean the Obligations, the Senior Secured Notes Obligations, any Permitted Additional Debt Obligations (other than any Permitted Additional Debt Obligations that are unsecured or are secured by a Lien ranking junior to the Liens securing the Obligations (but without regard to control of remedies)) and any Permitted Equal Priority Refinancing Debt, collectively.

“Fitch” shall mean Fitch Ratings, Inc., and any successor to its rating agency business.

“Flood Insurance Laws” means, collectively, (i) the National Flood Insurance Reform Act of 1994 (which comprehensively revised the National Flood Insurance Act of 1968 and the Flood Disaster Protection Act of 1973) as now or hereafter in effect or any successor statute thereto, (ii) the Flood Insurance Reform Act of 2004 as now or hereafter in effect or any successor statute thereto, and (iii) the Biggert-Waters Flood Insurance Reform Act of 2012 as now or hereafter in effect or any successor statute thereto.

“Floor” shall mean the benchmark rate floor, if any, provided in this Agreement (as of the Amendment No. 7 Effective Date or the subsequent modification, amendment or renewal of this Agreement or otherwise) with respect to the Adjusted Term SOFR Rate or the Adjusted Daily Simple SOFR, as applicable. For the avoidance of doubt the initial Floor for each of Adjusted Term SOFR Rate or the Adjusted Daily Simple SOFR shall be 0.00%.

“Funded Debt” shall mean all indebtedness of the Canadian Borrower and the Restricted Subsidiaries for borrowed money that matures more than one year from the date of its creation or matures within one year from such date that is renewable or extendable, at the option of the Canadian Borrower or any Restricted Subsidiary, to a date more than one year from such date or arises under a revolving credit or similar agreement that obligates the lender or lenders to extend credit during a period of more than one year from such date, including all amounts of Funded Debt required to be paid or prepaid within one year from the date of its creation and, in the case of the Borrowers, Indebtedness in respect of the Loans.

“GAAP” shall mean Generally Accepted Accounting Principles as adopted by the Canadian Borrower and the Restricted Subsidiaries from time to time to prepare their published financial statements in accordance with the International Financial Reporting Standards as issued by the International Accounting Standards Board (“IFRS”) in effect from time to time.

“Governmental Authority” shall mean any federal, state, provincial, local or foreign court or tribunal or governmental agency, authority, instrumentality or regulatory or legislative body.

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“Guarantee Obligations” shall mean, as to any Person, any obligation of such Person guaranteeing or intended to guarantee any Indebtedness of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, including any obligation of such Person, whether or not contingent, (a) to purchase any such Indebtedness or any property constituting direct or indirect security therefor, (b) to advance or supply funds (i) for the purchase or payment of any such Indebtedness or (ii) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, (c) to purchase property, securities or services primarily for the purpose of assuring the owner of any such Indebtedness of the ability of the primary obligor to make payment of such Indebtedness or (d) otherwise to assure or hold harmless the owner of such Indebtedness against loss in respect thereof; provided, however, that the term “Guarantee Obligations” shall not include endorsements of instruments for deposit or collection in the ordinary course of business. The amount of any Guarantee Obligation shall be deemed to be an amount equal to the stated or determinable amount of the Indebtedness in respect of which such Guarantee Obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such Person is required to perform thereunder) as determined by such Person in good faith.

“Guaranteed Obligations” shall have the meaning assigned to such term in Section 10.01.

“Guarantees” shall mean the guarantees issued pursuant to Article X.

“Guarantors” shall mean each Subsidiary of the Canadian Borrower that is or becomes a party to this Agreement, provided that upon release or discharge of such Subsidiary from its Guarantee in accordance with this Agreement, such Subsidiary shall cease to be a Guarantor.

“Hazardous Materials” shall mean all pollutants, contaminants, wastes, chemicals, materials, substances and constituents, including explosive or radioactive substances or petroleum or petroleum distillates, asbestos or asbestos containing materials, polychlorinated biphenyls or radon gas, of any nature subject to regulation or which can give rise to liability under any Environmental Law.

“Honor Date” shall have the meaning assigned to such term in Section 2.05(e)(i).

“Identified Participating Lender” shall have the meaning given to it in Section 2.12(f)(iii)(C).

“Identified Qualifying Lender” shall have the meaning given to it in Section 2.12(f)(iv)(C).

“IFRS” shall have the meaning given to it in the definition of the term “GAAP.”

~~“~~~~ImpactedInterest Period~~~~” shall have the meaning given to it in the definition of “LIBO Rate.”~~

“Incremental Agreement” shall have the meaning assigned to such term in Section 2.21(e).

“Incremental Commitments” shall have the meaning assigned to such term in Section 2.21(a).

“Incremental Facilities” shall have the meaning given to it in Section 2.21(a).

“Incremental Limit” shall have the meaning given to it in Section 2.21(b).

“Incremental Maturity Date” shall mean, with respect to any Class of Incremental Term Loans made pursuant to Section 2.21, the final maturity date thereof.

“Incremental Revolving Credit Commitment Increase” shall have the meaning given to it in Section 2.21(a).

“Incremental Revolving Credit Commitment Increase Lender” shall have the meaning assigned to such term in Section 2.21(f)(ii).

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“Incremental Term Loan Commitment” shall mean the Commitment of any Lender to make Incremental Term Loans of a particular Class pursuant to Section 2.21.

“Incremental Term Loan Exposure” shall mean, at any time, the aggregate principal amount of Incremental Term Loans outstanding at such time. The Incremental Term Loan Exposure of any Lender at any time shall be the aggregate principal amount of such Lender’s Incremental Term Loan outstanding at such time.

“Incremental Term Loan Facility” shall mean each Class of Incremental Term Loans made pursuant to Section 2.21.

“Incremental Term Loan Lenders” shall mean a Lender with outstanding Incremental Term Loans.

“Incremental Term Loans” shall have the meaning assigned to such term in Section 2.21(a).

“incur” shall mean create, issue, assume, guarantee, incur or otherwise become directly or indirectly liable for any Indebtedness; provided, however, that any Indebtedness of a Person existing at the time such Person becomes a Restricted Subsidiary (whether by merger, consolidation, acquisition or otherwise) shall be deemed to be incurred by such Person at the time it becomes a Restricted Subsidiary. The term “incurrence” when used as a noun shall have a correlative meaning. Solely for purposes of determining compliance with Section 6.01:

(a) amortization of debt discount or the accretion of principal with respect to a non-interest bearing or other discount security;

(b) the payment of regularly scheduled interest in the form of additional Indebtedness of the same instrument or the payment of regularly scheduled dividends on Equity Interests in the form of additional Equity Interests of the same class and with the same terms; and

(c) the obligation to pay a premium in respect of Indebtedness arising in connection with the issuance of a notice of prepayment, redemption, repurchase, defeasance, acquisition or similar payment or making of a mandatory offer to prepay, redeem, repurchase, defease, acquire, or similarly pay such Indebtedness;

will not be deemed to be the incurrence of Indebtedness.

“Indebtedness” means, with respect to any Person, (a) all indebtedness of such Person for borrowed money (including, without limitation, BAs but excluding the impact of capitalized financing costs and prepayment options), (b) the deferred purchase price of assets or services that in accordance with GAAP would be included as liabilities in the balance sheet of such Person, (c) the face amount of all letters of credit issued for the account of such Person and, without duplication, all drafts drawn thereunder, (d) all Indebtedness of a second Person secured by any Lien on any property owned by such first Person, whether or not such Indebtedness has been assumed (excluding any Lien created pursuant to the APT Security Agreement), (e) all Finance Lease Obligations of such Person, (f) all net obligations of such Person under interest rate swap, cap or collar agreements, interest rate future or option contracts, currency swap agreements, currency future or option contracts, commodity price protection agreements or other commodity price hedging agreements and other similar agreements, (g) without duplication, all Guarantee Obligations of such Person in respect of the foregoing and (h) any Disqualified Capital Stock; provided that Indebtedness shall not include (i) trade payables and accrued expenses, in each case payable directly or through a bank clearing arrangement and arising in the ordinary course of business, (ii) obligations to make progress or incentive payments under Satellite Purchase Agreements and Launch Services Agreements, in each case, not overdue by more than 90 days, (iii) deferred or prepaid revenue, (iv) purchase price holdbacks in respect of a portion of the purchase price of an asset to satisfy warranty or other unperformed obligations of the respective seller, (v) obligations to make payments to one or more insurers under satellite insurance policies in respect of premiums or the requirement to remit to such insurer(s) a portion of the future revenues generated by a Satellite which has been declared a constructive total loss, in each case in accordance with the terms of the insurance policies relating thereto, (vi) Indebtedness of any parent entity appearing on the balance sheet of the Canadian Borrower or any Restricted Subsidiary solely by reason of “pushdown” accounting under GAAP, (vii) Non-Finance Lease Obligations or other

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obligations under or in respect of straight-line leases, operating leases or Sale Leaseback (except resulting in Finance Lease Obligations) and (viii) customer deposits made in connection with the construction or acquisition of a Satellite being constructed or acquired at the request of one or more customers. The amount of Indebtedness of any Person for purposes of clause (d) shall be deemed to be equal to the lesser of (x) the aggregate unpaid amount of such Indebtedness and (y) the Fair Market Value of the property encumbered thereby as reasonably determined by such Person in good faith. The amount of Indebtedness of any Person for purposes of clause (h) shall be deemed to be equal to the greater of the voluntary or involuntary liquidation preference and maximum fixed repurchase price in respect of such Disqualified Capital Stock. For purposes hereof, the “maximum fixed repurchase price” of any Disqualified Capital Stock that does not have a fixed repurchase price shall be calculated in accordance with the terms of such Disqualified Capital Stock as if such Disqualified Capital Stock were purchased on any date on which Indebtedness shall be required to be determined pursuant to this Agreement, and if such price is based upon, or measured by, the Fair Market Value of such Disqualified Capital Stock, such Fair Market Value shall be determined reasonably and in good faith by the Board of Directors of the Canadian Borrower.

“Indemnified Taxes” shall mean all (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of any Loan Party under any Loan Document and (b) to the extent not otherwise described in (a), Other Taxes.

“Indemnitee” shall have the meaning assigned to such term in Section 9.05(b).

“Independent Director” means, with respect to the Board of Directors of the Canadian Borrower, a member of such board who is not an officer, director, employee or appointee of Loral or its Affiliates (other than the Canadian Borrower and its Subsidiaries).

“Information” shall have the meaning given to it in Section 3.14.

“Initial Lien” shall have the meaning given to it in Section 6.02.

“In-Orbit Contingency Protection” shall mean transponder capacity that, in the good faith determination of the Canadian Borrower, is available on a contingency basis from the Canadian Borrower or its Restricted Subsidiaries, or any Subsidiary of any parent of the Canadian Borrower, directly or from another satellite operator pursuant to a contractual arrangement, to accommodate the transfer of traffic representing at least 25% of the revenue-generating capacity with respect to any Satellite (or, if the entire Satellite is not owned by the Canadian Borrower or any of its Restricted Subsidiaries, as the case may be, the portion of the Satellite it owns or for which it has risk of loss) that may suffer actual or constructive total loss and that meets or exceeds the contractual performance specifications for the transponders that had been utilized by such traffic; it being understood that the Satellite (or portion, as applicable) shall be deemed to be insured for a percentage of the Satellite’s (or applicable portion’s) net book value for which In-Orbit Contingency Protection is available.

“In-Orbit Insurance” shall mean, with respect to any Satellite (or, if the entire Satellite is not owned by the Canadian Borrower or any of its Restricted Subsidiaries, as the case may be, the portion of the Satellite it owns or for which it has risk of loss), insurance (subject to a right of coinsurance or deductible in an amount up to $75,000,000) or other contractual arrangement providing for coverage against the risk of loss of or damage to such Satellite (or portion, as applicable) attaching upon the expiration of the Launch Insurance therefor (or, if Launch Insurance is not procured, upon the initial completion of in-orbit testing) and attaching, during the commercial in-orbit service of such Satellite (or portion, as applicable), upon the expiration of the immediately preceding corresponding policy or other contractual arrangement, as the case may be, subject to the terms and conditions set forth herein.

“Intercompany Note” shall mean an intercompany note substantially in the form of Exhibit F hereto.

“Interest Election Request” shall mean a request by the Canadian Borrower to convert or continue a Term B-5 Loan Borrowing or Revolving R-3 Facility Borrowing in accordance with Section 2.08.

“Interest Payment Date” shall mean (a) with respect to any ~~Eurodollar~~Term Benchmark Loan, the last day of the Interest Period applicable to the Borrowing of which such Loan is a part and, in the case of a ~~Eurodollar~~Term

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Benchmark Borrowing with an Interest Period of more than three months’ duration, each day that would have been an Interest Payment Date had successive Interest Periods of three months’ duration been applicable to such Borrowing and, in addition, the date of any refinancing or conversion of such Borrowing with or to a Borrowing of a different Type, (b) with respect to any ABR Loan, the last day of each calendar quarter, and, in addition, the date of any refinancing or conversion of such Borrowing with or to a Borrowing of a different Type, ~~and~~(c) with respect to any Swingline Loan, the day that such Swingline Loan is required to be repaid pursuant to Section 2.10(a) and (d) with respect to any Loan bearing interest at a rate determined by reference to the Adjusted Daily Simple SOFR, each date that is on the numerically corresponding day in each calendar month that is one month after the Borrowing of such Loan (or, if there is no such numerically corresponding day in such month, then the last day of such month).

“Interest Period” shall mean (a) as to any ~~Eurodollar~~Term Benchmark Borrowing, the period commencing on the date of such Borrowing ~~or on the last day ofthe immediately preceding Interest Period applicable to such Borrowing, as applicable,~~ and ending on the numerically corresponding day ~~(or, if~~ ~~there is no numerically correspondingday, on the last day)~~ in the calendar month that is ~~1~~one, ~~2, 3~~three or ~~6~~six months thereafter (~~or 12 months or a period shorter than one month, if agreed to by all relevant Lendersat the time of the applicable Borrowing, or,~~ in ~~the~~each case ~~of the Borrowings to be made on the Amendment No. 6 Effective Date, such shorter period as to whichthe Administrative Agent shall consent~~, subject to the availability for the Benchmark applicable to the relevant Loan or Commitment), as the Canadian Borrower may elect, or the date any ~~Eurodollar~~Term Benchmark Borrowing is converted to an ABR Borrowing in accordance with Section 2.08 or repaid or prepaid in accordance with Section 2.10, 2.11 or 2.12; provided, however, that (i) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day, (ii) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period and (iii) no tenor that has been removed from this definition pursuant to Section 2.15(e) shall be available for specification in any applicable Borrowing Request or Interest Election Request. Interest shall accrue from and including the first day of an Interest Period to but excluding the last day of such Interest Period and (b) as to any BA Borrowing, the BA Contract Period.

~~“~~~~InterpolatedRate~~~~” means, at any time~~~~, for any Interest Period, therate per annum (rounded to the same number of decimal places as the Reference Rate) determined by the Administrative Agent (which determinationshall be conclusive and binding absent manifest error) to be equal to the rate that results from interpolating on a linear basis between:(a) the Reference Rate for the longest period (for which the Reference Rate is available) that is shorter than the Impacted Interest Period;and (b) the Reference Rate for the shortest period (for which that Reference Rate is available) that exceeds the Impacted Interest Period,in each case, at such time.~~

“Investment” means, with respect to any Person, all investments by such Person in other Persons (including Affiliates) in the form of loans (including guarantees), advances or capital contributions (excluding accounts receivable, trade credit, advances to customers, commission, travel and similar advances to officers and employees, in each case made in the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities issued by any other Person and investments that are required by GAAP to be classified on the balance sheet (excluding the footnotes) of the Canadian Borrower in the same manner as the other investments included in this definition to the extent such transactions involve the transfer of cash or other property. For purposes of the definition of “Unrestricted Subsidiary” and Section 6.06,

22.

(1) “Investments” shall include the portion (proportionate to the Canadian Borrower’s equity interest in such Subsidiary) of the Fair Market Value of the net assets of a Subsidiary of the Canadian Borrower at the time that such Subsidiary is designated an Unrestricted Subsidiary; provided, however, that upon a redesignation of such Subsidiary as a Restricted Subsidiary, the Canadian Borrower shall be deemed to continue to have a permanent “Investment” in an Unrestricted Subsidiary in an amount (if positive) equal to:

(x) the Canadian Borrower’s “Investment” in such Subsidiary at the time of such redesignation, less

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(y) the portion (proportionate to the Canadian Borrower’s equity interest in such Subsidiary) of the Fair Market Value of the net assets of such Subsidiary at the time of such redesignation; and

(2) any property transferred to or from an Unrestricted Subsidiary shall be valued at its Fair Market Value at the time of such transfer.

The amount of any Investment outstanding at any time shall be the original cost of such Investment, reduced by any dividend, distribution, interest payment, return of capital, repayment or other amount received in Cash Equivalents by the Canadian Borrower or a Restricted Subsidiary in respect of such Investment to the extent such amounts do not increase any other baskets under this Agreement.

“ISED” shall mean the Department of Innovation, Science and Economic Development Canada or any successor department of the Government of Canada substituted therefor.

“ISED Authorizations” shall mean all authorizations, orders, licenses and exemptions issued by ISED to the Canadian Borrower or any of its Subsidiaries, pursuant to authority under the Radiocommunication Act or the Telecommunications Act, as amended, under which the Canadian Borrower or any of its Subsidiaries is authorized to launch and operate any of its Satellites or to operate any of its transmit only, receive only or transmit and receive earth stations or any ancillary terrestrial communications facilities.

“ISP” shall mean, with respect to any Letter of Credit, the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice (or such later version thereof as may be in effect at the time of issuance).

“Joint Lead Arrangers” shall mean (i) with respect to the Term B-3 Loans, JPMCB, Credit Suisse Securities (USA) LLC, Goldman Sachs Bank USA and Morgan Stanley Senior Funding, Inc., (ii) with respect to the Term B-4 Loan Facility, JPMCB (including pursuant to Amendment No. 4 and Amendment No. 5), (iii) with respect to the Revolving R-2 Facility, CIBC, BMO Capital Markets Corp., RBC Capital Markets^1^, and TD SECURITIES, (iv) with respect to the Term B-5 Loan Facility, JPMCB and Goldman Sachs Bank USA and (v) with respect to the Revolving R-3 Facility, Goldman Sachs Bank USA, JPMCB, BMO Capital Markets, CIBC, Credit Suisse Loan Funding LLC, Morgan Stanley Senior Funding, Inc., RBC Capital Markets, ING Bank N.V., The Bank of Nova Scotia and TD SECURITIES.

“JPMCB” shall have the meaning assigned to such term in the introductory paragraph of this Agreement.

“Judgment Currency” shall have the meaning assigned to such term in Section 9.17(b).

“Junior Priority Intercreditor Agreement” shall mean the Junior Priority Intercreditor Agreement substantially in the form of Exhibit M-2, among (x) the Collateral Agent and (y) one or more representatives of the holders of Permitted Additional Debt and/or Permitted Refinancing Indebtedness secured by Liens on the Collateral ranking junior to the Liens securing the Secured Obligations, with any immaterial changes and material changes thereto in light of the prevailing market conditions, which material changes shall be posted to the Lenders not less than five Business Days before execution thereof and, if the Required Lenders shall not have objected to such changes within five Business Days after posting, then the Required Lenders shall be deemed to have agreed that the Administrative Agent’s and/or Collateral Agent’s entry into such intercreditor agreement (with such changes) is reasonable and to have consented to such intercreditor agreement (with such changes) and to the Administrative Agent’s and/or Collateral Agent’s execution thereof.

“Launch” shall mean, with respect to any Satellite, the point in time before lift-off of such Satellite at which risk of loss of such Satellite passes to the applicable Satellite Purchaser under the terms of the applicable Satellite Purchase Agreement, unless risk of loss thereunder is to pass to such Satellite Purchaser after lift-off, in which case “Launch” shall mean the intentional ignition of the first stage engines of the launch vehicle that has been integrated with such Satellite.

^1^	RBC Capital Markets is a brand name for the capital markets<br>businesses of Royal Bank of Canada and its affiliates.

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“Launch Insurance” shall mean, with respect to any Satellite, insurance for risks of loss of and damage to such Satellite attaching not later than the time of Launch and continuing at least until the successful or unsuccessful attempt to achieve physical separation of such Satellite from the launch vehicle that had been integrated with such Satellite.

“Launch Services Agreement” shall mean, with respect to any Satellite, the agreement between the applicable Satellite Purchaser and the applicable Launch Services Provider relating to the launch of such Satellite.

“Launch Services Provider” shall mean, with respect to any Satellite, the provider of launch services for such Satellite pursuant to the terms of the Launch Services Agreement related thereto.

“Law” shall mean, collectively, all international, foreign, Federal, state, provincial and local statutes, treaties, rules, guidelines, regulations, ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrative orders, directives, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority, in each case whether or not having the force of Law.

“L/C Borrowing” shall mean a Revolving R-3 Facility Borrowing made pursuant to Section 2.05(e)(iv) and (v) to refinance Unreimbursed Amounts in respect of drawn Letters of Credit.

“L/C Disbursement” shall mean a payment or disbursement made by a L/C Issuer pursuant to a Letter of Credit.

“L/C Documents” shall mean, with respect to any Letter of Credit, such Letter of Credit, any amendments thereto, any other documents delivered in connection therewith, any application therefor and any agreements, instruments, guaranties or other documents (whether general in application to Letters of Credit generally or applicable only to such Letter of Credit) governing or providing for (i) the rights and obligations of the parties concerned or at risk or (ii) any collateral security for such obligations.

“L/C Issuer” shall mean (i) JPMCB and CIBC, each in their respective capacity as issuer of Letters of Credit under Section 2.05(a), and their respective permitted successor or successors in such capacity and (ii) any other Lender which the Canadian Borrower shall have designated as an “L/C Issuer” by notice to the Administrative Agent and such Lender shall have accepted such designation in accordance with Section 2.05.

“L/C Issuer Fees” shall have the meaning assigned to such term in Section 2.13(b).

“L/C Obligations” shall mean at any time, the sum of (i) the maximum amount which is, or at any time thereafter may become, available to be drawn under Letters of Credit then outstanding, assuming compliance with all requirements for drawings referred to in such Letters of Credit plus (ii) the aggregate amount of all L/C Disbursements not yet reimbursed by the Canadian Borrower as provided in Section 2.05(e)(ii), (iii), (iv) or (v) to the applicable L/C Issuers in respect of drawings under Letters of Credit, including any portion of any such obligation to which a Lender has become subrogated pursuant to Section 2.05(e)(vi). For all purposes of this Agreement and all other Loan Documents, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP, such Letter of Credit shall be deemed to be “outstanding” in the amount so remaining available to be drawn.

“L/C Participation Fee” shall have the meaning assigned such term in Section 2.13(b).

“L/C Sublimit” shall mean an amount equal to $25,000,000. The L/C Sublimit is a part of, and not in addition to, the Revolving R-3 Facility.

“LCT Election” shall have the meaning assigned to such term in Section 1.06.

“LCT Test Date” shall have the meaning assigned to such term in Section 1.06.

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“Lender” shall mean (a) as of the Amendment No. 6 Effective Date, the Persons listed on Schedule 2.01, (b) any other Person that shall become a party hereto as a “lender” pursuant to Section 9.04 and (c) each person that becomes a “lender” pursuant to the terms of Section 2.21, in each case other than a Person who ceases to hold any outstanding Loans, Letter of Credit Exposure, Swingline Exposure or any Commitment.

“Lender Insolvency Event” shall mean that (i) a Lender or its Parent Company is determined or adjudicated to be insolvent by a Governmental Authority, or is generally unable to pay its debts as they become due, or admits in writing its inability to pay its debts as they become due, or makes a general assignment for the benefit of its creditors, or (ii) such Lender or its Parent Company is the subject of a bankruptcy, insolvency, reorganization, liquidation or similar proceeding, or a receiver, trustee, conservator, intervenor or sequestrator or the like has been appointed for such Lender or its Parent Company, or such Lender or its Parent Company has taken any action in furtherance of or indicating its consent to or acquiescence in any such proceeding or appointment; provided that a Lender Insolvency Event shall not be deemed to have occurred solely by virtue of the ownership or acquisition of any Equity Interest in any Lender or its Parent Company by a Governmental Authority or an instrumentality thereof.

“Letter of Credit” shall mean any letter of credit or letter of guarantee issued pursuant to Section 2.05 or any Existing Letter of Credit.

“Letter of Credit Expiration Date” shall mean the day that is three Business Days prior to the Revolving R-3 Facility Maturity Date then in effect.

“Letter of Credit Exposure” shall mean, subject to Section 2.23, with respect to any Lender, at any time, the sum of (a) the amount of any Unpaid Drawings in respect of which such Lender has made (or is required to have made) Revolving R-3 Facility Loans pursuant to Section 2.05 at such time and (b) such Lender’s Revolving R-3 Commitment Percentage of the L/C Obligations at such time (excluding the portion thereof consisting of Unpaid Drawings in respect of which the Lenders have made (or are required to have made) Revolving R-3 Facility Loans pursuant to Section 2.05).

“Letter of Credit Request” shall have the meaning assigned to such term in Section 2.05(c)(i).

~~“~~~~LIBORate~~~~” shall mean, with respect to any Eurodollar Borrowing for any Interest Period, the rate per annum determinedby the Administrative Agent at approximately 11:00 a.m., London time, on the Quotation Day for such Interest Period by reference to theapplicable Reference Rate, for a period equal to such Interest Period;~~ ~~provided~~ ~~that if the ReferenceRate shall not be available at such time for such Interest Period (an “~~~~Impacted Interest Period~~~~”)then the LIBO Rate shall be the Interpolated Rate;~~ ~~provided~~~~,~~ ~~further~~~~,that, to the extent that an interest rate is not ascertainable pursuant to the foregoing provisions of this definition, the “LIBORate” shall be the average (rounded upward, if necessary, to the next 1/100 of 1%) of the respective interest rates per annum atwhich deposits in the currency of such Borrowing are offered for such Interest Period to major banks in the London interbank market bythe Reference Banks at approximately 11:00 a.m., London time, on the Quotation Day for such Interest Period.~~

“Lien” means, with respect to any asset, any mortgage, lien, pledge, hypothec, charge, security interest or encumbrance of any kind in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law, including any conditional sale or other title retention agreement, any lease in the nature thereof, any option or other agreement to sell or give a security interest in and any filing of or agreement to give any financing statement under the UCC or PPSA (or equivalent statutes) of any jurisdiction; provided that in no event shall any lease (other than a Finance Lease Obligation) entered into in the ordinary course of business be deemed to constitute a Lien. For the avoidance of doubt, in no event shall a Non-Finance Lease Obligation be deemed to be a Lien.

“Limited Condition Transaction” means (1) any Investment or acquisition (whether by merger, amalgamation, consolidation or other business combination or the acquisition of Capital Stock or otherwise), whose consummation is not conditioned on the availability of, or on obtaining, third-party financing, (2) any redemption, repurchase, defeasance, satisfaction and discharge or repayment of Indebtedness, Disqualified Capital Stock or preferred stock requiring irrevocable notice in advance of such redemption, repurchase, defeasance, satisfaction and discharge or repayment and (3) any Restricted Payment requiring irrevocable notice in advance thereof.

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“Loan Documents” shall mean this Agreement, the Letters of Credit, the BAs, the Security Documents, any promissory note issued under Section 2.10(e), Amendment No. 2, Amendment No. 3, Amendment No. 4, Amendment No. 5, Amendment No. 6, Amendment No. 7 and, solely for the purposes of Section 7.01(c) hereof, the Fee Letter.

“Loan Participant” shall have the meaning assigned to such term in Section 9.04(c)(i).

“Loan Parties” shall mean the Borrowers and each Subsidiary Loan Party.

“Loans” shall mean the Term Loans, the Revolving R-3 Facility Loans and the Swingline Loans.

“Loral” shall mean Loral Space & Communications Inc.

“Majority Lenders” (i) for the Revolving R-3 Facility, shall mean, at any time, Lenders under such Facility having Revolving R-3 Facility Loans and unused Revolving R-3 Facility Commitments representing more than 50% of the sum of all Revolving R-3 Facility Loans outstanding under the Revolving R-3 Facility and unused Revolving R-3 Facility Commitments at such time and (ii) for each of the Term Loan Facilities, Lenders having applicable Term Loans and Term Loan Commitments representing more than 50% of the sum of all Term Loans and Term Loan Commitments of such Term Loan Facility.

“Margin Stock” shall have the meaning assigned to such term in Regulation U.

“Market Capitalization” shall mean an amount equal to (a) the total number of issued and outstanding shares of Capital Stock of the Canadian Borrower or any parent entity of the Canadian Borrower so long as the Canadian Borrower is a Wholly Owned Subsidiary of such entity on a fully diluted basis on the date of the declaration of a dividend permitted pursuant to Section 6.06(b)(xii) multiplied by (b) the arithmetic mean of the closing prices per share of such Capital Stock on the principal securities exchange on which such Capital Stock is traded for the 30 consecutive trading days immediately preceding the date of declaration of such Restricted Payment.

“Material Adverse Effect” shall mean the existence of events, conditions and/or contingencies that have had or are reasonably likely to have (a) a materially adverse effect on the business, operations, properties, assets or financial condition of the Canadian Borrower and the Subsidiaries, taken as a whole, or (b) a material impairment of the validity or enforceability of, or a material impairment of the material rights, remedies or benefits available to the Lenders, any L/C Issuer, the Administrative Agent or the Collateral Agent under any Loan Document.

“Material Indebtedness” shall mean Indebtedness (other than Loans and Letters of Credit) of any one or more of the Canadian Borrower or any Restricted Subsidiary in an aggregate principal amount exceeding $110,000,000.

“Material Leased Real Property” shall have the meaning assigned to such term in Section 5.10(b).

“Material Owned Real Property” shall have the meaning assigned to such term in Section 5.10(b).

“Material Real Property” shall mean Material Leased Real Property and Material Owned Real Property.

“Material Subsidiary” shall mean, at any date of determination, any Restricted Subsidiary (a) whose Total Assets at the last day of the Test Period ending on the last day of the most recent fiscal period for which financial statements have been delivered pursuant to Section 5.04(a) were equal to or greater than 5% of the consolidated Total Assets of the Canadian Borrower and its consolidated subsidiaries at such date or (b) whose gross revenues for such Test Period were equal to or greater than 5% of the consolidated gross revenues of the Canadian Borrower and its consolidated subsidiaries for such period, in each case determined in accordance with GAAP.

“Maximum Rate” shall have the meaning assigned to such term in Section 9.09.

“Measurement Date” shall mean October 11, 2019.

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“Mezzanine Securities” shall mean the securities periodically issued by the Canadian Borrower in favor of Loral as satisfaction of the Canadian Borrower’s payments under the Consulting Services Agreement.

“Minority Investment” shall mean any Person (other than a Subsidiary) in which the Canadian Borrower or any Restricted Subsidiary owns capital stock or other equity interests.

“Moody’s” shall mean Moody’s Investors Service, Inc. and any successor to its rating agency business.

“Mortgaged Properties” shall mean (i) the real property of the applicable Loan Party set forth on Schedule 1.01(c) and designated therein as “Mortgaged Properties” and (ii) such additional real property (if any) of Loan Parties encumbered by a Mortgage pursuant to Section 5.10.

“Mortgages” shall mean the mortgages, deeds of trust, debentures, deeds of hypothec, assignments of leases and rents, leasehold mortgages, leasehold deeds of interest and other security documents delivered pursuant to Section 4.02(d) or 5.10, as amended, supplemented or otherwise modified from time to time, with respect to Mortgaged Properties each in a form reasonably satisfactory to the Administrative Agent (which shall include, for U.S. mortgaged properties, a mortgage substantially in the form attached hereto as Exhibit K) and consistent with the provisions of this Agreement.

“Multiemployer Plan” shall mean a multiemployer plan as defined in Section 4001(a)(3) of ERISA to which the Borrowers, the Canadian Borrower or any ERISA Affiliate is making or accruing an obligation to make contributions, or has within any of the preceding six plan years made or accrued an obligation to make contributions.

“Named Satellites” shall mean the Satellites commonly referred to as Anik F2, Anik F3, Telstar 11N, Nimiq 4, Nimiq 5, Anik G1, Nimiq 6, Telstar 12 VANTAGE, Telstar 18 VANTAGE and Telstar 19 VANTAGE.

“Nationally Recognized Independent Financial Advisor” means an accounting, appraisal, investment banking firm or consultant of nationally recognized standing that is, in the good faith judgment of the Canadian Borrower, qualified to perform the task for which it has been engaged.

“Net Cash Proceeds” shall mean, with respect to any Prepayment Event, (a) the gross cash proceeds (including payments from time to time in respect of installment obligations, if applicable) received by or on behalf of the Canadian Borrower or any of the Restricted Subsidiaries in respect of such Prepayment Event less (b) the sum of:

(i) in the case of any Prepayment Event, the amount, if any, of all Taxes paid or estimated to be payable by the Canadian Borrower or any of the Restricted Subsidiaries in connection with such Prepayment Event,

(ii) in the case of any Prepayment Event, the amount of any reasonable reserve established in accordance with GAAP against any liabilities (other than any Taxes deducted pursuant to clause (i) above) (x) associated with the assets that are the subject of such Prepayment Event and (y) retained by the Canadian Borrower or any of the Restricted Subsidiaries; provided that the amount of any subsequent reduction of such reserve (other than in connection with a payment in respect of any such liability) shall be deemed to be Net Cash Proceeds of such a Prepayment Event occurring on the date of such reduction,

(iii) in the case of any Prepayment Event, the amount of any Indebtedness secured by a Lien on the assets that are the subject of such Prepayment Event to the extent that the instrument creating or evidencing such Indebtedness requires that such Indebtedness be repaid upon consummation of such Prepayment Event,

(iv) in the case of any Asset Sale Event or Casualty Event, the amount of any proceeds of such Asset Sale Event or Casualty Event that the Canadian Borrower or any Restricted Subsidiary has (a) reinvested prior to the last day of such Reinvestment Period, (b) entered into a binding commitment to reinvest such proceeds within two years after the receipt of such proceeds prior to the last day of such Reinvestment Period or (c) entered into a binding commitment to reinvest such proceeds in Satellites and/or

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other Satellite Assets, including the costs of any Launch and Launch Insurance, which Satellite shall (A) achieve the milestone known as preliminary design review within two years after the receipt of such proceeds and (B) be scheduled for launch within four years after the receipt of such proceeds, in each case, in the business of the Canadian Borrower or any of the Restricted Subsidiaries (subject to Section 6.16); provided that proceeds deducted from Net Cash Proceeds pursuant to this clause (iv) by reason of clause (b) or (c) shall (x) be deemed to be Net Cash Proceeds of an Asset Sale Event or Casualty Event occurring on the last day of the two year period described in clause (b) if such amounts are not so reinvested or on the last day of the period set forth the applicable milestone in clause (c) if such milestone is not met during such applicable period and (y) if so deemed to be Net Cash Proceeds, be applied to the repayment of Loans in accordance with Section 2.12(c),

(v) in the case of any Casualty Event, the amount of any payment to any customer providing a deposit or other related amounts which must be repaid in the event of a Casualty Event, including any rebates, settlement amounts or other proceeds received from a Satellite Manufacturer in relation to performance incentives or performance warranty paybacks with respect to a Satellite (it being understood that if such proceeds are in respect of a replacement Satellite which has not achieved the milestone known as preliminary design review within the relevant period referred to in clause (iv) or is not scheduled to be launched within four years of receipt of such proceeds with respect to such predecessor Satellite referred to in clause (iv), then such proceeds need only to be applied to the Loans and Commitments to the extent of such proceeds without giving effect to clause (iv) to the extent of any duplication),

(vi) in the case of any Asset Sale Event or Casualty Event by any non-wholly owned Restricted Subsidiary, the pro rata portion of the net cash proceeds thereof (calculated without regard to this clause (vi)) attributable to minority interests and not available for distribution to or for the account of the Canadian Borrower or a wholly owned Restricted Subsidiary as a result thereof, and

(vii) in the case of any Prepayment Event, incurrence of Indebtedness, disposition, issuance of Equity Interests or receipt of a capital contribution, the reasonable and customary fees, commissions, expenses (including attorney’s fees, investment banking fees, survey costs, title insurance premiums and search and recording charges, transfer taxes, deed or mortgage recording taxes and other customary expenses and brokerage, consultant and other customary fees or commissions), issuance costs, discounts and other costs and expenses (and, in the case of the incurrence of any Indebtedness the proceeds of which are required to be used to prepay any Class of Loans and/or reduce any Class of Commitments under this Agreement, accrued interest and premium, if any, on such Loans and any other amounts (other than principal) required to be paid in respect of such Loans and/or Commitments in connection with any such prepayment and/or reduction), and payments made in order to obtain a necessary consent required by applicable law, in each case only to the extent not already deducted in arriving at the amount referred to in clause (a) above.

“Net Short Lender” shall have the meaning assigned to such term in Section 9.08(h).

“Non-Consenting Lender” shall have the meaning assigned to such term in Section 2.20(c).

“Non-Debt Fund Affiliate” shall mean shall mean any Affiliate of the Canadian Borrower (other than the Borrowers or any Restricted Subsidiary) that is not a Debt Fund Affiliate.

“Non-Defaulting Lender” shall mean and includes each Lender other than a Defaulting Lender.

“Non-Extension Notice Date” shall have the meaning assigned to such term in Section 2.05(c)(iii).

“Non-Finance Lease Obligations” shall mean a lease obligation that is not required to be accounted for as a financing or capital lease on both the balance sheet and the income statement for financial reporting purposes in accordance with GAAP. For avoidance of doubt, a straight-line or operating lease shall be considered a Non-Finance Lease Obligation.

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“Non-Loan Party Asset Sale” shall have the meaning assigned to such term in Section 2.12(h).

“Non-Loan Party Casualty Event” shall have the meaning assigned to such term in Section 2.12(h).

“Non-Subsidiary Loan Party” shall mean any Subsidiary that is not a Subsidiary Loan Party.

“Non-Successor Person” shall have the meaning assigned to such term in Section 6.03(b)(A)(i).

“Non-U.S. Pension Plan” shall mean any plan, fund (including, without limitation, any superannuation fund) or other similar program established or maintained outside the United States of America by the Borrowers or any Subsidiary primarily for the benefit of employees of the Borrowers or any Subsidiary residing outside the United States of America (other than in Canada), which plan, fund or other similar program provides, or results in, retirement income, a deferral of income in contemplation of retirement or payments to be made upon termination of employment, and which plan is not subject to ERISA or the Code.

“Note” shall have the meaning assigned to such term in Section 2.10(e).

“Obligations” shall mean (a) obligations of the Borrowers and the other Loan Parties from time to time arising under or in respect of the due and punctual payment of (i) the principal of and premium, if any, and interest (including interest accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding) on the Term Loans and Revolving R-3 Facility Loans, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise (including reimbursement obligations in respect of BAs accepted hereunder), and (ii) all other monetary obligations, including fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise (including monetary obligations incurred during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding), of the Borrowers and the other Loan Parties under this Agreement and the other Loan Documents, and (b) the due and punctual performance of all covenants, agreements, obligations and liabilities of the Borrowers and the other Loan Parties under or pursuant to this Agreement and the other Loan Documents.

“OFAC” shall have the meaning assigned to such term in Section 3.21(a).

“Offered Amount” shall have the meaning given to it in Section 2.12(f)(iv)(A).

“Offered Discount” shall have the meaning given to it in Section 2.12(f)(iv)(A).

“Other Connection Taxes” means, with respect to any Administrative Agent, Lender, Swingline Lender or L/C Issuer, Taxes imposed as a result of a present or former connection between such recipient and the jurisdiction imposing such Tax (other than connections arising solely from such recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).

“Other Taxes” shall mean any and all present or future stamp, court or documentary, intangible, recording filing or similar Taxes arising from any payment made hereunder or from the execution, delivery, performance, registration or enforcement of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment of an interest in any Loan or Loan Document (other than an assignment made pursuant to Section 2.20(b)).

“Parent Company” shall mean, with respect to a Lender, the bank holding company (as defined in Federal Reserve Board Regulation Y), if any, of such Lender, and/or any Person owning, beneficially or of record, directly or indirectly, a majority of the economic or voting Equity Interests of such Lender.

“Participant Register” shall have the meaning given to it in Section 9.04(c)(i).

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“Participating Lender” shall have the meaning given to it in Section 2.12(f)(iii)(B).

“Participation Interest” shall mean a Credit Extension by a Lender by way of a purchase of a participation interest in Letters of Credit or L/C Obligations as provided in Section 2.05(d), in Swingline Loans as provided in Section 2.04(f) or in any Loans as provided in Section 2.19(e).

“Patriot Act” shall mean the Uniting and Strengthening America by Providing the Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (Title III of Pub. L. 107-56 (signed into law October 26, 2001)).

“PBGC” shall mean the Pension Benefit Guaranty Corporation referred to and defined in ERISA.

“PCTFA” shall have the meaning assigned to such term in the definition of “Anti-Terrorism Laws and Anti-Money Laundering Laws”.

“Permitted Acquisition” shall mean the acquisition, by merger or otherwise, by the Canadian Borrower or any of the Restricted Subsidiaries of assets or capital stock or other equity interests, so long as (a) such acquisition and all transactions related thereto shall be consummated in all material respects in accordance with applicable law; (b) such acquisition shall result in the issuer of such capital stock or other equity interests to the extent applicable becoming a Restricted Subsidiary and a Guarantor, to the extent required by Section 5.10; (c) such acquisition shall result in the Administrative Agent, for the benefit of the applicable Lenders, being granted a security interest in any capital stock or any assets so acquired, to the extent required by Section 5.10; and (d) after giving effect to such acquisition, no Event of Default under Sections 7.01(b), (c), (h) or (i) has occurred and is continuing.

“Permitted Additional Debt” shall mean (a) secured or unsecured bonds, notes or debentures (which bonds, notes or debentures, if secured, may be secured by Liens on the Collateral having a priority ranking equal to the priority of the Liens on the Collateral securing the Secured Obligations (but without regard to control of remedies) or by Liens on the Collateral having a priority ranking junior to the Liens on the Collateral securing the Secured Obligations) or (b) secured or unsecured loans (or commitments to provide loans or other extensions of credit) (which loans or commitments, if secured, may be secured by Liens on the Collateral having a priority ranking junior (but not equal) to the Liens on the Collateral securing the Secured Obligations), in each case incurred by or provided to the Canadian Borrower, the U.S. Borrower or another Guarantor, provided that (a) the terms of such Indebtedness or commitments do not provide for maturity or any scheduled amortization or mandatory repayment, mandatory redemption, mandatory commitment reduction, mandatory offer to purchase or sinking fund obligation prior to the Final Maturity Date, other than, subject (except, in the case of any such Indebtedness or commitments that constitute, or are intended to constitute, other First Lien Obligations) to the prior repayment or prepayment of, or the prior offer to repay or prepay (and to the extent such offer is accepted, the prior repayment or prepayment of) the Obligations hereunder (other than Swap Obligations, Cash Management Obligations or contingent indemnification obligations and other contingent obligations not then due and payable), customary prepayments, commitment reductions, repurchases, redemptions, defeasances, acquisitions or satisfactions and discharges, or offers to prepay, reduce, redeem, repurchase, defease, acquire or satisfy and discharge upon, a change of control, asset sale event or casualty, eminent domain or condemnation event, or on account of the accumulation of excess cash flow (in the case of loans or commitments) and customary acceleration rights upon an event of default; provided that the foregoing requirements of this clause (a) shall not apply to the extent such Indebtedness or commitments constitute a customary bridge facility, so long as the long-term Indebtedness into which any such customary bridge facility is to be converted or exchanged satisfies the requirements of this clause (a) and such conversion or exchange is subject only to conditions customary for similar conversions or exchanges, (b) except for any of the following that are applicable only to periods following the Final Maturity Date, the covenants, events of default, Subsidiary guarantees and other terms for such Indebtedness or commitments (excluding, for the avoidance of doubt, interest rates (including through fixed interest rates), interest rate margins, rate floors, fees, maturity, funding discounts, original issue discounts and redemption or prepayment terms and premiums), when taken as a whole, are determined by the Canadian Borrower to not be materially more restrictive on the Canadian Borrower and its Restricted Subsidiaries than the terms of this Agreement, when taken as a whole (provided that, if the documentation governing such Indebtedness or commitments contains any Previously Absent Financial Maintenance Covenant, the Administrative Agent shall have been given prompt written notice thereof and this Agreement shall have been amended to include such Previously

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Absent Financial Maintenance Covenant for the benefit of each Facility (provided, however, that, if (x) the documentation governing the Permitted Additional Debt that includes a Previously Absent Financial Maintenance Covenant consists of a revolving credit facility (whether or not the documentation therefor includes any other facilities) and (y) such Previously Absent Financial Maintenance Covenant is a covenant only applicable to, or for the benefit of, a revolving credit facility, then this Agreement shall be amended to include such Previously Absent Financial Maintenance Covenant only for the benefit of each revolving credit facility hereunder (and not for the benefit of any term loan facility hereunder) and such Indebtedness or commitments shall not be deemed “more restrictive” solely as a result of such Previously Absent Financial Maintenance Covenant benefiting only such revolving credit facilities); provided that a certificate of a Responsible Officer of the Canadian Borrower delivered to the Administrative Agent at least five Business Days prior to the incurrence of such Indebtedness or the providing of such commitments, together with a reasonably detailed description of the material terms and conditions of such Indebtedness or commitments or drafts of the documentation relating thereto, stating that the Canadian Borrower has determined in good faith that such terms and conditions satisfy the foregoing requirement shall be conclusive evidence that such terms and conditions satisfy the foregoing requirement unless the Administrative Agent notifies the Canadian Borrower within such five Business Day period that it disagrees with such determination (including a reasonable description of the basis upon which it disagrees), (c) if such Indebtedness is senior subordinated or subordinated Indebtedness, the terms of such Indebtedness provide for customary “high yield” subordination of such Indebtedness to the Secured Obligations, (d) any Permitted Additional Debt may not be guaranteed by any subsidiaries of the Canadian Borrower that do not guarantee the Obligations and (e) any secured Permitted Additional Debt incurred may not be secured by any assets that do not secure the Secured Obligations and shall be subject to an applicable Customary Intercreditor Agreement.

“Permitted Additional Debt Documents” shall mean any document or instrument (including any guarantee, security or collateral agreement or mortgage and which may include any or all of the Loan Documents) issued or executed and delivered with respect to any Permitted Additional Debt by any Loan Party.

“Permitted Additional Debt Obligations” shall mean, if any secured Permitted Additional Debt has been incurred by or provided to a Loan Party and is outstanding, the collective reference to (a) the due and punctual payment of (i) the principal of and premium, if any, and interest at the applicable rate provided in the applicable Permitted Additional Debt Documents (including interest accruing during the pendency of any proceeding under any applicable Debtor Relief Laws (or would accrue but for the operation of applicable Debtor Relief Laws), regardless of whether allowed or allowable in such proceeding) on any such Permitted Additional Debt, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment, repurchase, redemption, defeasance, acquisition or otherwise and (ii) all other monetary obligations, including fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise (including monetary obligations incurred during the pendency of any proceeding under any applicable Debtor Relief Laws, regardless of whether allowed or allowable in such proceeding), of the Canadian Borrower or any other Loan Party to any of the Permitted Additional Debt Secured Parties under the applicable Permitted Additional Debt Documents and (b) the due and punctual performance of all covenants, agreements, obligations and liabilities of the Borrowers or any Loan Party under or pursuant to applicable Permitted Additional Debt Documents.

“Permitted Additional Debt Secured Parties” shall mean the holders from time to time of the secured Permitted Additional Debt Obligations (and any representative on their behalf).

“Permitted Asset Swap” means the concurrent purchase and sale or exchange of Related Business Assets or a combination of Related Business Assets and cash or Cash Equivalents between the Canadian Borrower or any of its Restricted Subsidiaries and another Person.

“Permitted Business” shall mean the business conducted or proposed to be conducted by the Canadian Borrower and its Subsidiaries on the Amendment No. 2 Effective Date or any business that is similar, reasonably related, incidental or ancillary thereto.

“Permitted Change of Control” shall mean any transaction or series of related transactions that constitute a “Change of Control” pursuant to clause (2) of the first paragraph of the definition thereof as the result of the acquisition of the Voting Stock of the Canadian Borrower, directly or indirectly through one or more holding

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companies, by a Buyer and the Canadian Borrower shall be in compliance, on a pro forma basis assuming the giving of effect to such transactions or series of related transactions (including any Indebtedness incurred or to be incurred) in connection therewith, with a Total Leverage Ratio of no greater than 4.50 to 1.00, as such ratio is recomputed as of, subject to the provisions of Section 1.06, the last day of the Test Period most recently ended on or prior to the date of consummation of such Permitted Change of Control).

“Permitted Change of Control Election” shall have the meaning given to it in Section 2.09(e).

“Permitted Change of Control Terminated Commitments” shall have the meaning given to it in Section 2.09(e).

“Permitted Change of Control Termination Event” shall have the meaning given to it in Section 2.09(e).

“Permitted Debt” shall have the meaning given to it in Section 6.01.

“Permitted Equal Priority Refinancing Debt” shall mean any secured Indebtedness incurred by any Borrower and/or the Guarantors in the form of one or more series of senior secured notes, bonds or debentures; provided that (a) such Indebtedness is secured by Liens on all or a portion of the Collateral on an equal priority basis with the Liens on the Collateral securing the Secured Obligations (but without regard to the control of remedies) and is not secured by any property or assets of the Canadian Borrower, any Borrower or any Restricted Subsidiary other than the Collateral, (b) such Indebtedness satisfies the applicable requirements set forth in the provisos to the definition of “Credit Agreement Refinancing Indebtedness”, (c) such Indebtedness is not at any time guaranteed by any Subsidiaries of the Canadian Borrower other than Subsidiaries that are Guarantors and (d) the holders of such Indebtedness (or their representative) and Collateral Agent shall become parties to a Customary Intercreditor Agreement providing that the Liens on the Collateral securing such obligations shall rank equal in priority to the Liens on the Collateral securing the Secured Obligations (but without regard to the control of remedies).

“Permitted Holders” means each of (a) (i) Loral, (ii) PSP, (iii) MHR Fund Management LLC, (iv) Intelsat, Ltd., (v) SES SA, (vi) Eutelsat Communications SA, (vii) EchoStar Corporation, (viii) Dish Network Corporation, (ix) Inmarsat plc, (x) Buyer and (xi) Affiliates of each of the foregoing (including, for the avoidance of doubt, any limited partnership, the general partner of which is owned by a convenience party, such as a trust for the benefit of a charity, such general partner, any trust controlling such general partner, and such convenience party), (b) members of management of the Canadian Borrower who are shareholders of the Canadian Borrower on the Measurement Date and (c) any Person, entity or “group” (within the meaning of Section 13(d) or 14(d) of the Exchange Act (or any successor provision)) the members of which include any of the Permitted Holders specified in clauses (a) and (b) above (a “Permitted Holder Group”); provided that, in the case of any Permitted Holder Group, the Permitted Holders specified in clauses (a) and (b) above collectively own, directly or indirectly, without giving effect to the existence of such group, Equity Interests having more than 50.0% of the total voting power of the Voting Stock of the Canadian Borrower held by such Permitted Holder Group; provided, further, that, in the case of clauses (a)(iv) through (a)(ix) (and clause (a)(xi) solely with respect to clauses (a)(iv) through (a)(ix)) of this definition, a Rating Decline shall not have occurred in connection with the transaction (including any incurrence of Indebtedness used to finance the acquisition thereof) involving such Permitted Holder that would have resulted in a Change of Control (but for the terms of this definition) and provided, further, that the notice referred to in the definition of Rating Decline has been given to each of the Rating Agencies.

“Permitted Investments” means:

(1) any Investment in (x) the Canadian Borrower or any Guarantor or (y) in a Restricted Subsidiary that is not a Guarantor, in the case of this clause (y) in an aggregate amount since the Measurement Date, not to exceed, together with any Investments made in respect of, or made by, Persons that are not Loan Parties pursuant to clause (3) below, the greater of $180,000,000 and 4.0% of Total Assets at the time of such Investment, plus, to the extent such amounts are not otherwise applied to clause (B)(4) of the definition of the term “Applicable Amount,” the amount of any returns (including dividends, payments, interest, distributions, returns of principal, profits on sale, repayments, income and similar amounts) on or in respect of such Investments;

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(2) any Investment in cash and Cash Equivalents;

(3) any Investment by the Canadian Borrower or any Restricted Subsidiary of the Canadian Borrower in a Person that is engaged in a Similar Business, if, as a result of such Investment:

(a) such Person becomes a Restricted Subsidiary, or

(b) such Person, in one transaction or a series of related transactions, is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, the Canadian Borrower or a Restricted Subsidiary;

provided that, any Investments made in respect of, or made by, Persons that are not Loan Parties pursuant to this clause (3) shall not exceed an aggregate amount since the Measurement Date, together with any Investments made in Restricted Subsidiaries that are not Guarantors pursuant to clause (1)(y) above, equal to the greater of $180,000,000 and 4.0% of Total Assets at the time of such Investment;

(4) any Investment in securities or other assets not constituting cash or Cash Equivalents and received in connection with an Asset Sale made pursuant to Section 6.04, or any other disposition of assets not constituting an Asset Sale;

(5) any Investment existing on the Measurement Date, which in the case of any such Investment in an amount in excess of $10,000,000, is set forth on Schedule 6.06;

(6) any Investment acquired by the Canadian Borrower or any Restricted Subsidiary:

(a) in exchange for any other Investment or accounts receivable held by the Canadian Borrower or any such Restricted Subsidiary in connection with or as a result of a bankruptcy, workout, reorganization or recapitalization of the Canadian Borrower or such Restricted Subsidiary of such other Investment or accounts receivable or

(b) as a result of a foreclosure by the Canadian Borrower or any Restricted Subsidiary with respect to any secured Investment or other transfer of title with respect to any secured Investment in default;

(7) Swap Obligations permitted under clause (j) of the second paragraph of Section 6.01;

(8) Investments the payment for which consists of Equity Interests of the Canadian Borrower, or any of its direct or indirect parent companies (exclusive of Disqualified Capital Stock); provided, however, that such Equity Interests shall not increase the amount available for Restricted Payments under the calculation set forth in the definition of the term “Applicable Amount”;

(9) guarantees of Indebtedness permitted under Section 6.01;

(10) any transaction to the extent it constitutes an investment that is permitted and made in accordance with the provisions of Section 6.12(b) (except transactions described in Sections 6.12(b)(ii) and 6.12(b)(iv));

(11) Investments consisting of purchases and acquisitions of inventory, supplies, material or equipment;

(12) if no Default or Event of Default has occurred and is continuing, additional Investments having an aggregate Fair Market Value, taken together with all other Investments made pursuant to this clause (12) (without giving effect to the sale of an Unrestricted Subsidiary to the extent the proceeds of such sale do not consist of cash or marketable securities), not to exceed since the Measurement Date the greater

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of $150,000,000 and 3.25% of Total Assets at the time of such Investments (with the Fair Market Value of each Investment being measured at the time made and without giving effect to subsequent changes in value) plus, to the extent such amounts are not otherwise applied to clause (B)(4) of the definition of the term “Applicable Amount,” the amount of any returns (including dividends, payments, interest, distributions, returns of principal, profits on sale, repayments, income and similar amounts) on or in respect of such Investments;

(13) advances to employees not in excess of the greater of $10,000,000 and 0.25% of Total Assets outstanding at any one time, in the aggregate;

(14) loans and advances to officers, directors and employees for business-related travel expenses, moving expenses and other similar expenses, in each case incurred in the ordinary course of business; and

(15) additional Investments, so long as on a pro forma basis after giving effect to such Investment and the incurrence of any related Indebtedness, the Total Leverage Ratio for the Test Period immediately preceding such date shall be less than or equal to 3.50 to 1.00.

“Permitted Junior Priority Refinancing Debt” shall mean secured Indebtedness incurred by any Borrower and/or any Guarantor in the form of one or more series of junior lien secured notes, bonds or debentures or junior lien secured loans; provided that (a) such Indebtedness is secured by Liens on all or a portion of the Collateral on a junior priority basis to the Liens on the Collateral securing the Secured Obligations and any other First Lien Obligations and is not secured by any property or assets of the Borrowers or any Restricted Subsidiary other than the Collateral, (b) such Indebtedness satisfies the applicable requirements set forth in the provisos in the definition of “Credit Agreement Refinancing Indebtedness” (provided that such Indebtedness may be secured by a Lien on the Collateral that ranks junior in priority to the Liens on the Collateral securing the Secured Obligations and any other First Lien Obligations, notwithstanding any provision to the contrary contained in the definition of “Credit Agreement Refinancing Indebtedness”), (c) the holders of such Indebtedness (or their representative) and the Collateral Agent shall become parties to a Customary Intercreditor Agreement providing that the Liens on the Collateral securing such obligations shall rank junior in priority to the Liens on the Collateral securing the Secured Obligations, and (d) such Indebtedness is not at any time guaranteed by any Subsidiaries of the Canadian Borrower other than Subsidiaries that are Guarantors.

“Permitted Liens” means, with respect to any Person:

(1) pledges or deposits by such Person under workmen’s compensation laws, unemployment insurance laws or similar legislation, or good faith deposits in connection with bids, tenders, contracts (other than for the payment of Indebtedness) or leases to which such Person is a party, or deposits to secure public or statutory obligations of such Person or deposits of cash or U.S. government bonds to secure surety or appeal bonds to which such Person is a party, or deposits as security for the payment of rent, in each case incurred in the ordinary course of business;

(2) Liens imposed by law, such as carriers’, landlords’ liens, warehousemen’s, storers’, repairers’ and mechanics’ Liens and other similar Liens arising in the ordinary course of business, in each case for sums not yet due or being contested in good faith by appropriate proceedings or other Liens arising out of judgments or awards against such Person with respect to which such Person shall then be proceeding with an appeal or other proceedings for review;

(3) Liens for taxes, assessments or other governmental charges not yet due or payable or which are being contested in good faith by appropriate proceedings;

(4) Liens in favor of the Borrowers of performance and surety bonds or bid bonds or with respect to other regulatory requirements or letters of credit issued pursuant to the request of and for the account of such Person in the ordinary course of its business;

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(5) minor survey exceptions, minor encumbrances, easements or reservations of, or rights of others for, licenses, rights-of-way, sewers, electric lines, telegraph and telephone lines and other similar purposes, or zoning or other restrictions as to the use of real properties or Liens incidental, to the conduct of the business of such Person or to the ownership of its properties which were not incurred in connection with Indebtedness and which do not in the aggregate materially adversely affect the value of said properties or materially impair their use in the operation of the business of such Person;

(6) Liens securing Indebtedness permitted to be incurred pursuant to clause (a), (b) (with respect to the Senior Secured Notes), (d) or (m) of the definition of Permitted Debt; provided that in the case of such clause (d) such Liens shall not extend to any assets other than the specified asset being financed (and insurance proceeds related thereto) and additions and improvements thereon and in the case of such clause (m) such Liens shall not attach to any assets other than the specified asset being financed (including satellite, launch and related revenue contracts and insurance proceeds);

(7) Liens existing on the Measurement Date, which in the case of any such Liens securing obligations in an amount in excess of $10,000,000, are set forth on Schedule 6.02;

(8) Liens on property or shares of stock of a Person at the time such Person becomes a Subsidiary; provided, however, such Liens are not created or incurred in connection with, or in contemplation of, such other Person becoming such a subsidiary; provided, further, however, that such Liens may not extend to any other property owned by the Canadian Borrower or any Restricted Subsidiary;

(9) Liens on property at the time the Canadian Borrower or a Restricted Subsidiary acquired the property, including any acquisition by means of a merger, amalgamation or consolidation with or into the Canadian Borrower or any Restricted Subsidiary; provided, however, that such Liens are not created or incurred in connection with, or in contemplation of, such acquisition; provided, further, however, that the Liens may not extend to any other property owned by the Canadian Borrower or any Restricted Subsidiary;

(10) Liens placed upon the capital stock of any Restricted Subsidiary acquired in an acquisition or similar transaction permitted by this Agreement to secure Indebtedness incurred pursuant to clause (o)(ii) of the definition of Permitted Debt and/or Liens placed upon the assets of any such Restricted Subsidiary so acquired to secure a guarantee by such Restricted Subsidiary of any such Indebtedness of the Canadian Borrower or any other Restricted Subsidiary;

(11) Liens securing Indebtedness or other obligations of a Restricted Subsidiary owing to the Canadian Borrower or another Restricted Subsidiary permitted to be incurred in accordance with Section 6.01 hereof;

(12) Liens securing Swap Obligations (including Liens in favor of a counterparty to a swap or similar agreement on the Canadian Borrower’s or any Restricted Subsidiary’s rights under such agreement) and Cash Management Obligations, in each case so long as the related Indebtedness is permitted to be incurred under this Agreement;

(13) Liens on specific items of inventory or other goods and proceeds of any Person securing such Person’s obligations in respect of bankers’ acceptances issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;

(14) leases and subleases of real property which do not materially interfere with the ordinary conduct of the business of the Canadian Borrower or any of the Restricted Subsidiaries;

(15) Liens arising from UCC or PPSA financing statement filings regarding operating leases entered into by the Canadian Borrower and its Restricted Subsidiaries in the ordinary course of business;

(16) Liens (including Liens in connection with Sale Leasebacks) in favor of the Borrowers or any Guarantor;

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(17) Liens on equipment of the Canadian Borrower or any Restricted Subsidiary granted in the ordinary course of business to a client of the Canadian Borrower or a Restricted Subsidiary at which such equipment is located;

(18) Liens to secure any refinancing, refunding, extension, renewal or replacement (or successive refinancing, refunding, extensions, renewals or replacements) as a whole, or in part, of any Indebtedness secured by any Lien referred to in the foregoing clauses (6), (7), (8), (9), (10), (11), (12) and (16); provided, however, that (x) such new Lien shall be limited to all or part of the same property that secured the original Lien (plus improvements on such property), (y) the Indebtedness secured by such Lien at such time is not increased to any amount greater than the sum of (A) the outstanding principal amount or, if greater, committed amount of the Indebtedness described under clauses (6), (7), (8), (9), (10), (11), (12) and (16) at the time the original Lien became a Permitted Lien under this Agreement, and (B) an amount necessary to pay any fees and expenses, including premiums, related to such refinancing, refunding, extension, renewal or replacement, and (z) if the applicable original Lien extended to any assets securing the Secured Obligations, such new Lien may be incurred in respect of such collateral only on terms not materially less favorable to the Lenders, as determined in good faith by the Canadian Borrower, than the terms and conditions of the applicable original Lien;

(19) deposits made in the ordinary course of business to secure liability to insurance carriers;

(20) reservations, limitations, provisos and conditions expressed in any original grant from the Canadian Crown or other grants of real or immovable property, or interests therein;

(21) the right reserved to or vested in any Governmental Authority by the terms of any lease, license, franchise, grant or permit acquired by the Canadian Borrower or any of its Restricted Subsidiaries or by any statutory provision to terminate any such lease, license, franchise, grant or permit, or to require annual or other payments as a condition to the continuance thereof;

(22) security given to a public utility or any Governmental Authority when required by such utility or authority in connection with the operations of the Canadian Borrower or any of its Restricted Subsidiaries in the ordinary course of its business;

(23) subdivision agreements, site plan control agreements, development agreements, servicing agreements, cost sharing, reciprocal and other similar agreements with municipal and other Governmental Authorities affecting the development, servicing or use of a property; provided the same are complied with in all material respects except as such non-compliance does not interfere in any material respect as determined in good faith by the Canadian Borrower with the business of the Canadian Borrower and its Subsidiaries taken as a whole;

(24) facility cost sharing, servicing, reciprocal or other similar agreements related to the use and/or operation of a property in the ordinary course of business, provided the same are complied with in all material respects;

(25) Liens in favor of customers on Satellites or portions thereof (including insurance proceeds relating thereto) or the satellite construction or acquisition agreement being related thereto in the event such Satellites or portions thereof are being constructed or acquired at the request of one or more customers to secure repayment of deposits and related amounts;

(26) restrictions in condosat agreements or revenue agreements (as any such condosat agreements or revenue agreements may from time to time be modified, supplemented, amended, renewed or replaced, the “Subject Agreements”) relating to transponders that restrict sales, dispositions, leases or security interests on satellites to any third party purchaser, lessee or secured party unless such purchaser or lessee of such satellite agrees to (or, in the case of a security interest in such satellite, the secured party agrees pursuant to a non-disturbance agreement that in connection with the enforcement of any such security interest or the realization upon any such security interest, such secured party agrees that, prior to or

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concurrently with the transfer becoming effective, the person to whom the satellite bus shall be transferred shall agree that such transferee shall) be subject to the terms of the applicable Subject Agreement and provided that, with respect to any Subject Agreement entered into after the Measurement Date, the Canadian Borrower and/or the applicable Restricted Subsidiaries shall have used their commercially reasonable efforts in negotiating such Subject Agreement so that such Subject Agreement does not contain such restrictions;

(27) deemed trusts created by operation of law in respect of amounts which are (i) not yet due and payable, (ii) immaterial, (iii) being contested in good faith and by appropriate proceedings for which appropriate reserves have been established in accordance with GAAP or (iv) unpaid due to inadvertence after exercising due diligence;

(28) [reserved];

(29) other Liens so long as the aggregate principal amount of the obligations so secured does not exceed the greater of $150,000,000 and 3.25% of Total Assets at any one time outstanding;

(30) ground leases in respect of real property on which facilities owned or leased by the Canadian Borrower or any of its Subsidiaries are located;

(31) 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;

(32) any interest or title of a lessor or secured by a lessor’s interest under any lease permitted by this Agreement (other than in respect of a Finance Lease Obligation), together with all Liens of whatsoever nature permitted or created by such lessor or any fee owner of the property or any predecessor in title, including in connection with any Sale Leaseback;

(33) Liens on goods the purchase price of which is financed by a documentary letter of credit issued for the account of the Canadian Borrower or any of its Subsidiaries; provided that such Lien secures only the obligations of the Canadian Borrower or such Subsidiaries in respect of such letter of credit to the extent permitted under Section 6.01; and

(34) Liens created in the ordinary course of business in favor of banks and other financial institutions over credit balances of any bank accounts of the Canadian Borrower and the Restricted Subsidiaries held at such banks or financial institutions, as the case may be, to facilitate the operation of cash pooling and/or interest set-off arrangements in respect of such bank accounts in the ordinary course of business.

For purposes of this definition, the term “Indebtedness” shall be deemed to include interest on such Indebtedness.

“Permitted Refinancing” shall mean, with respect to any Person, any Indebtedness (“Permitted Refinancing Indebtedness”) incurred in exchange for or as a replacement of (including by entering into alternative financing arrangements in respect of such exchange or replacement (in whole or in part), by adding or replacing lenders, creditors, agents, borrowers and/or guarantors, or, after the original instrument giving rise to such Indebtedness has been terminated, by entering into any credit agreement, loan agreement, note purchase agreement, indenture or other agreement), or the net proceeds of which are to be used for the purpose of modifying, extending, refinancing, renewing, replacing, redeeming, repurchasing, defeasing, acquiring, amending, supplementing, restructuring, repaying, prepaying, retiring, extinguishing or refunding (collectively, a “Refinancing” or to “Refinance”) Indebtedness (the “Refinanced Indebtedness”) of such Person (or any successive Permitted Refinancing thereof); provided that (a) the principal amount (or accreted value, if applicable) thereof does not exceed the principal amount (or accreted value, if applicable) of the Refinanced Indebtedness except by an amount equal to unpaid accrued interest, dividends and premium (including tender premiums) thereon plus other amounts paid, and underwriting discounts, defeasance costs, fees, commissions and expenses incurred, in connection with such Refinancing and by

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an amount equal to any existing commitments unutilized thereunder or as otherwise permitted pursuant to Section 6.01, (b) other than with respect to a Refinancing in respect of Indebtedness permitted pursuant to clause (d) of the definition of Permitted Debt, such Permitted Refinancing Indebtedness has a Weighted Average Life to Maturity equal to or longer than the Weighted Average Life to Maturity of the Refinanced Indebtedness, (c) if the Refinanced Indebtedness is subordinated in right of payment to the Obligations, such Permitted Refinancing Indebtedness is subordinated in right of payment to the Obligations on terms not less favorable in any material respect as determined in good faith by the Canadian Borrower to the Lenders as those contained in the documentation governing the Refinanced Indebtedness, taken as a whole, and (d) if the Refinanced Indebtedness is secured by any assets securing the Secured Obligations, such Permitted Refinancing Indebtedness may be secured by such collateral on terms not materially less favorable to the Lenders, as determined in good faith by the Canadian Borrower, than the terms and conditions of the Refinanced Indebtedness.

“Permitted Refinancing Indebtedness” shall have the meaning provided in the definition of the term “Permitted Refinancing”.

“Permitted Swap Agreement” shall mean a Swap Agreement entered into with the Borrowers or the other Loan Parties that (x) was in existence prior to, and is in effect as of, the Amendment No. 2 Effective Date, (y) is entered into after the Amendment No. 2 Effective Date, in each case, with any counterparty that is a Lender, Agent or Joint Lead Arranger (or an Affiliate of a Lender, Agent or Joint Lead Arranger), unless such Swap Agreement states that it is not a Permitted Swap Agreement for purposes of the definitions of “Secured Creditors” and “Secured Obligations” or (z) is in effect as of the Amendment No. 2 Effective Date with The Governor and Company of the Bank of Ireland or an Affiliate thereof.

“Permitted Unsecured Refinancing Debt” shall mean unsecured Indebtedness incurred by any Borrower and/or the Guarantors in the form of one or more series of senior, senior subordinated or subordinated unsecured notes, bonds, debentures or loans; provided that (a) such Indebtedness satisfies the applicable requirements set forth in the provisos in the definition of “Credit Agreement Refinancing Indebtedness” and (b) such Indebtedness is not at any time guaranteed by any Subsidiaries of the Canadian Borrower other than Subsidiaries that are Guarantors.

“Person” or “person” means any individual, corporation, limited liability company, partnership, joint venture, association, joint stock company, trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity.

“Plan” shall mean any “employee pension benefit plan” as defined in Section 3(2) of ERISA (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code and in respect of which the Canadian Borrower, any Subsidiary or any ERISA Affiliate is (or, if such plan were terminated, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

“Pledged Collateral” shall have the meaning assigned to such term in the Security Documents.

“PMRR” has the meaning assigned to that term in the definition of “Collateral and Guarantee Requirement.”

“PPSA” shall mean the Personal Property Security Act as in effect from time to time (except as otherwise specified) in an applicable Province or territory of Canada.

“Prepayment Account” shall have the meaning given to it in Section 2.06(i).

“Prepayment Event” shall mean any Asset Sale Event, Debt Incurrence Event, or Casualty Event, other than any such Asset Sale Event or Casualty Event the Net Cash Proceeds of which are less than $25,000,000.

“Previously Absent Financial Maintenance Covenant” shall mean, at any time (x) any financial maintenance covenant that is not included in this Agreement at such time and (y) any financial maintenance covenant in any other Indebtedness that is included in this Agreement at such time but with covenant levels that are more restrictive on the Canadian Borrower and the Restricted Subsidiaries than the covenant levels included in this Agreement at such time.

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“Primary Obligations” shall mean (a) in the case of the Lenders, all principal of, premium, fees and interest on, all Loans (including the face amount of BAs accepted hereunder), all unreimbursed L/C Disbursements, the maximum amount available to be drawn under all outstanding Letters of Credit and all Fees and (b) in the case of the Swap Counterparties, all amounts due under each Permitted Swap Agreement with a Swap Counterparty and similar obligations and liabilities.

“primary obligor” shall have the meaning assigned to such term in the definition of “Guarantee Obligations.”

“Prime Rate” shall mean the rate of interest last quoted by The Wall Street Journal as the “Prime Rate” in the U.S. or, if The Wall Street Journal ceases to quote such rate, the highest per annum interest rate published by the ~~Federal Reserve~~ Board in Federal Reserve Statistical Release H.15 (519) (Selected Interest Rates) as the “bank prime loan” rate or, if such rate is no longer quoted therein, any similar rate quoted therein (as determined by the Administrative Agent) or any similar release by the ~~Federal Reserve~~ Board (as determined by the Administrative Agent). Each change in the Prime Rate shall be effective from and including the date such change is publicly announced or quoted as being effective.

“Pro Rata Share” shall mean, when calculating a Secured Creditor’s portion of any distribution or amount, that amount (expressed as a percentage) equal to a fraction the numerator of which is the then unpaid amount of such Secured Creditor’s Primary Obligations or Secondary Obligations, as the case may be, and the denominator of which is the then outstanding amount of all Primary Obligations or Secondary Obligations, as the case may be.

“PSP” shall mean Public Sector Pension Investment Board, a Canadian federal special Act corporation.

“PSPIB” shall mean, collectively, PSP and Red Isle Private Investments Inc., a wholly owned subsidiary of PSP.

“PTE” means a prohibited transaction class exemption issued by the U.S. Department of Labor, as any such exemption may be amended from time to time.

“Public Debt” means any Indebtedness consisting of bonds, debentures, notes or other similar debt securities issued in (a) a public offering registered under the Securities Act or (b) a private placement to institutional investors that is underwritten for resale in accordance with Rule 144A or Regulation S of the Securities Act, whether or not it includes registration rights entitling the holders of such debt securities to registration thereof with the SEC. The term “Public Debt” (i) shall not include the Senior Notes or the Senior Secured Notes and (ii) for the avoidance of doubt, shall not be construed to include any Indebtedness issued to institutional investors in a direct placement of such Indebtedness that is not underwritten by an intermediary (it being understood that, without limiting the foregoing, a financing that is distributed to not more than ten Persons (provided that multiple managed accounts and affiliates of any such Persons shall be treated as one Person for the purposes of this definition) shall be deemed not to be underwritten), or any Indebtedness under this Agreement, commercial bank or similar Indebtedness, Finance Lease Obligation or recourse transfer of any financial asset or any other type of Indebtedness incurred in a manner not customarily viewed as a “securities offering.”

“Purchasing Borrower Party” shall mean the Borrowers or any Restricted Subsidiary that becomes a transferee pursuant to Section 9.04.

“QFC” has the meaning assigned to the term “qualified financial contract” in, and shall be interpreted in accordance with, 12 U.S.C. 5390(c)(8)(D).

“QFC Credit Support” has the meaning assigned to it in Section 9.26.

“Qualified IPO” shall mean a public offering (other than a public offering pursuant to a registration statement on Form S-8) of the Voting Stock of the Canadian Borrower or any other direct or indirect parent entity thereof pursuant to an effective registration statement filed with the SEC in accordance with the Securities Act or a final prospectus for which a receipt has been issued by one or more securities commissions or regulatory authorities

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in the provinces or territories of Canada (in each case, whether alone or in connection with a secondary public offering), and also includes any transaction whereby the Canadian Borrower or any other direct or indirect parent entity thereof becomes a reporting issuer in any province or territory in Canada.

“Qualified Proceeds” shall mean assets that are used or useful in, or capital stock of any Person engaged in, a similar business; provided that the Fair Market Value of any such assets or capital stock shall be determined by the Canadian Borrower in good faith.

“Qualifying Lender” shall have the meaning given to it in Section 2.12(f)(iv)(C).

“Quebec Pension Plan” shall mean the universal pension plan established and maintained by the Provincial Government of Quebec.

~~“~~~~QuotationDay~~~~” shall mean, (a) with respect to any Eurodollar Borrowing and any applicable Interest Period, the secondBusiness Day of such Interest Period and (b) with respect to any ABR Borrowing, the day of determination. With respect to any EurodollarBorrowing and any applicable Interest Period, if such quotations would normally be given by prime banks on more than one day, the QuotationDay will be the last of such days.~~

“Rating Agency” means Moody’s, S&P and Fitch or if Moody’s, S&P and/or Fitch shall not make a rating on the Loans (or the corporate family rating of the Canadian Borrower) publicly available, a nationally recognized statistical rating agency or agencies, as the case may be, selected by the Canadian Borrower (as certified by a board resolution) which shall be substituted for Moody’s, S&P and/or Fitch, as the case may be.

“Rating Decline” means the occurrence on any date from and after the date of the public notice by the Canadian Borrower or another Person seeking to effect a transaction that would be a Change of Control (but for the definition of Permitted Holders) or an arrangement that, in the good faith judgment of the Canadian Borrower, would be expected to result in a Change of Control (but for the definition of Permitted Holders) until the end of the 30-day period following such public notice or the abandonment of the proposed transaction (which period shall be extended an additional 30 days if the rating of the Loans and/or the corporate family rating of the Canadian Borrower is under publicly announced consideration for possible downgrade by any Rating Agency at the end of the initial 30-day period) of: (1) a decline in the rating of the Loans or the corporate family rating of the Canadian Borrower by any Rating Agency by at least one notch in the gradation of the rating scale (e.g., + or – for S&P or 1, 2 and 3 for Moody’s) or of the credit outlook with respect thereto from such Rating Agency’s rating of the Loans or the corporate family rating of the Canadian Borrower; or (2) withdrawal by any Rating Agency of such Rating Agency’s rating of the Loans or the corporate family rating of the Canadian Borrower.

“Reference Banks” shall mean the principal Toronto office~~, in the case of the use of the term “Reference Banks”in the definition of Canadian Prime Rate, and London office, in the case of the use of the term “Reference Banks” in the definitionof LIBO Rate,~~ of each of JPMCB and CIBC or, in each case, such other or additional banks as may be appointed by the Administrative Agent in consultation with the Canadian Borrower.

~~“~~~~ReferenceRate~~~~” shall mean, with respect to any Eurodollar Borrowing for any Interest Period, an interest rate perannum equal to the rate per annum determined by the Administrative Agent at approximately 11:00 a.m. (London time) on such day by reference toICE Benchmark Administration Limited’s “LIBOR” rate (or by reference to the rates provided by any Person that takeover the administration of such rate if ICE Benchmark Administration Limited is no longer making a “LIBOR” rateavailable) for deposits in Dollars (as set forth on pages LIBOR01 or LIBOR02 of the Reuters screen displaying such“LIBOR” rate (or, in the event such rate does not appear on a Reuters page or screen, on any successor or substitutepage or screen that displays such rate, or on the appropriate page of such~~~~otherinformation service that publishes such rate from time to time~~~~, in each caseas selected by the Administrative Agent)) for a period equal in length to such Interest Period.~~ “Reference Time” with respect to any setting of the then-current Benchmark shall mean (1) if such Benchmark is the Term SOFR Rate, 5:00 a.m. (Chicago time) on the day that is two U.S. Government Securities Business Days preceding the date of such setting, (2) if such Benchmark is Daily Simple SOFR, then four Business Days prior to such setting or (3) if such Benchmark is none of the Term SOFR Rate or Daily Simple SOFR, the time determined by the Administrative Agent in its reasonable discretion.

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“Refinance” shall have the meaning provided in the definition of the term “Permitted Refinancing”.

“Refinanced Debt” shall have the meaning provided in the definition of the term “Credit Agreement Refinancing Indebtedness”.

“Refinanced Indebtedness” shall have the meaning provided in the definition of the term “Permitted Refinancing”.

“Refinanced Term Loans” shall have the meaning assigned to such term in Section 9.08(f).

“Refinancing” shall have the meaning provided in the definition of the term “Permitted Refinancing”.

“Refinancing Indebtedness” shall have the meaning assigned to such term in clause (n) of the definition of Permitted Debt.

“Refunded Swingline Loans” shall have the meaning assigned to such term in Section 2.04(c).

“Refunding Capital Stock” shall have the meaning given to it in Section 6.06(b)(ii).

“Register” shall have the meaning assigned to such term in Section 9.04(b)(iv).

“Regulated Bank” means (x) a banking organization with a consolidated combined capital and surplus of at least $5.0 billion that is (i) a U.S. depository institution the deposits of which are insured by the Federal Deposit Insurance Corporation; (ii) a corporation organized under section 25A of the U.S. Federal Reserve Act of 1913; (iii) a branch, agency or commercial lending company of a foreign bank operating pursuant to approval by and under the supervision of the Board of Governors of the Federal Reserve System under 12 CFR part 211; (iv) a non-U.S. branch of a foreign bank managed and controlled by a U.S. branch referred to in clause (iii); or (v) any other U.S. or non-U.S. depository institution or any branch, agency or similar office thereof supervised by a bank regulatory authority in any jurisdiction or (y) any Affiliate of a Person set forth in clause (x) to the extent that (1) all of the Capital Stock of such Affiliate is directly or indirectly owned by either (I) such Person set forth in clause (x) or (II) a parent entity that also owns, directly or indirectly, all of the Capital Stock of such Person set forth in clause (x) and (2) such Affiliate is a securities broker or dealer registered with the SEC under Section 15 of the Exchange Act.

“Regulation U” shall mean Regulation U of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

“Regulation X” shall mean Regulation X of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

“Reinvestment Period” shall mean the 12 months following the date of the receipt of proceeds in respect of such Asset Sale Event or Casualty Event.

“Related Business Assets” means assets (other than cash or Cash Equivalents) used or useful in a Similar Business; provided that any assets received by the Canadian Borrower or a Restricted Subsidiary in exchange for assets transferred by the Canadian Borrower or a Restricted Subsidiary shall not be deemed to be Related Business Assets if they consist of securities of a Person, unless upon receipt of the securities of such Person, such Person would become a Restricted Subsidiary.

“Related Parties” shall mean, with respect to any specified person, such person’s Affiliates and the respective directors, officers, employees, agents and advisors of such person and such person’s Affiliates.

“Release” shall mean any spilling, leaking, seepage, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, disposing, depositing, emanating or migrating in, into, onto or through the Environment.

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“Relevant Governmental Body” means the Board and/or the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Board and/or the Federal Reserve Bank of New York or, in each case, any successor thereto.

“Replacement Term Loans” shall have the meaning assigned to such term in Section 9.08(f).

“Reportable Event” shall mean any reportable event as defined in Section 4043(c) of ERISA or the regulations issued thereunder, other than those events as to which the 30-day notice period referred to in Section 4043(c) of ERISA has been waived, with respect to a Plan.

“Representative” shall have the meaning assigned such term in Section 9.21(d).

“Repricing Transaction” shall mean (a) the incurrence by a Borrower of any term loans (including, without limitation, any new or additional term loans under this Agreement, whether incurred directly or by way of the conversion of Term B-5 Loans into a new Class of replacement term loans under this Agreement) that is broadly marketed or syndicated (i) having an Effective Yield for the respective Type of such Indebtedness that is less than the Effective Yield for the Term B-5 Loans of the respective equivalent Type, but excluding Indebtedness incurred in connection with a Qualified IPO, Change of Control or Permitted Change of Control (or transaction that if consummated would constitute a Change of Control or Permitted Change of Control) or Transformative Acquisition and (ii) the proceeds of which are used to prepay (or, in the case of a conversion, deemed to prepay or replace), in whole or in part, outstanding principal of Term B-5 Loans or (b) any effective reduction in the Effective Yield for the Term B-5 Loans (e.g., by way of amendment, waiver or otherwise), except for a reduction in connection with a Qualified IPO, Change of Control or Permitted Change of Control (or transaction that if consummated would constitute a Change of Control or Permitted Change of Control) or Transformative Acquisition and, in the case of any transaction under either clause (a) or clause (b) above, the primary purpose of which is to lower the Effective Yield on the Term B-5 Loans. Any determination by the Administrative Agent with respect to whether a Repricing Transaction shall have occurred shall be conclusive and binding on all Lenders holding the Term B-5 Loans.

“Required Lenders” shall mean, at any time, Lenders having (a) Term B-5 Loan Exposures, (b) Revolving R-3 Facility Credit Exposures, (c) Incremental Term Loan Exposures and (d) Available Revolving Unused Commitments (if prior to the termination thereof) that taken together, represent more than 50% of the sum of (w) all Term B-5 Loan Exposures, (x) all Revolving R-3 Facility Credit Exposures, (y) all Incremental Term Loan Exposures and (z) the total Available Revolving Unused Commitments (if prior to the termination thereof) at such time. The Term B-5 Loan Exposures, Revolving R-3 Facility Credit Exposures, Incremental Term Loan Exposures and Available Revolving Unused Commitment of any Defaulting Lender shall be disregarded in determining Required Lenders at any time.

“Required Percentage” shall mean, with respect to an Excess Cash Flow Period, 50%; provided that if at the time of any prepayment required by Section 2.12(d) in respect of such Excess Cash Flow Period (a) the First Lien Leverage Ratio of the Canadian Borrower for the most recent fiscal year ended for which financial statements have been delivered pursuant to Section 5.04(a) is less than or equal to 3.00:1.00 but greater than 2.50:1.00, such percentage shall be 25% and (b) the First Lien Leverage Ratio of the Canadian Borrower for the most recent fiscal year ended for which financial statements have been delivered pursuant to Section 5.04(a) is less than or equal to 2.50:1.00, such percentage shall be 0%.

“Required Revolving Lenders” shall mean, at any time, Lenders having (a) Revolving R-3 Facility Outstandings and (b) Available Revolving Unused Commitments (if prior to the termination thereof) that taken together, represent more than 50% of the sum of (x) all Revolving R-3 Facility Outstandings and (y) the total Available Revolving Unused Commitments (if prior to the termination thereof) at such time. The Revolving R-3 Facility Credit Exposure and Available Revolving Unused Commitment of any Defaulting Lender or held by any Affiliates of the Canadian Borrower shall be disregarded in determining Required Lenders at any time.

“Requirements of Law” shall mean, collectively, any and all requirements of any Governmental Authority that are applicable, including any and all applicable laws, judgments, orders, the Executive Order, decrees, ordinances, rules, regulations, statutes or case law.

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“Reset Date” shall have the meaning assigned to such term in Section 1.03(a)(i).

“Responsible Officer” of any person shall mean any executive officer (including the chief legal officer) or Financial Officer of such person and any other officer or similar official thereof responsible for the administration of the obligations of such person in respect of this Agreement.

“Restricted Investment” means an Investment other than a Permitted Investment.

“Restricted Subsidiary” means, at any time, any direct or indirect Subsidiary of the Canadian Borrower that is not then an Unrestricted Subsidiary; provided, however, that upon the occurrence of an Unrestricted Subsidiary ceasing to be an Unrestricted Subsidiary, such Subsidiary shall be included in the definition of “Restricted Subsidiary.”

“Retired Capital Stock” shall have the meaning given to it in Section 6.06(b)(ii).

“Reuters” shall have the meaning given to it in the definition of Exchange Rate.

“Revolving Availability Period” shall mean the period from and including the Amendment No. 2 Effective Date to but excluding the earlier of the Revolving R-3 Facility Maturity Date and in the case of each of the Revolving R-3 Facility Loans, Revolving R-3 Facility Borrowings, Swingline Loans, Swingline Borrowings and Letters of Credit, the date of termination of the Revolving R-3 Facility Commitments.

“Revolving Credit Extension Request” shall have the meaning assigned to such term in Section 2.24(b).

“Revolving L/C Exposure” shall mean at any time the sum of (a) the aggregate undrawn amount of all Letters of Credit and (b) the aggregate principal amount of all L/C Disbursements made in respect of Letters of Credit that have not yet been reimbursed at such time. The Revolving L/C Exposure of any Revolving R-3 Facility Lender at any time shall mean its Revolving R-3 Facility Percentage of the aggregate Revolving L/C Exposure at such time.

“Revolving R-2 Facility Loan” shall mean each Revolving R-2 Facility Loan as defined under this agreement immediately prior to the Amendment No. 6 Effective Date.

“Revolving R-3 Commitment Percentage” shall mean, for each Lender, the percentage (carried out to the ninth decimal place) identified as its Revolving R-3 Commitment Percentage on Schedule 2.01 hereto, as such percentage may be adjusted or modified in connection with any assignment made in accordance with the provisions of Section 9.04(b), or as otherwise adjusted from time to time in accordance with this Agreement.

“Revolving R-3 Committed Amount” shall mean $200,000,000, or such greater or lesser amount to which the Revolving R-3 Committed Amount may be adjusted from time to time in accordance with this Agreement.

“Revolving R-3 Facility” shall mean the Revolving R-3 Facility Commitments and the extensions of credit made hereunder by the Revolving R-3 Facility Lenders.

“Revolving R-3 Facility Borrowing” shall mean a Borrowing comprised of Revolving R-3 Facility Loans.

“Revolving R-3 Facility Commitment” shall mean, with respect to each Revolving R-3 Facility Lender, (a) the commitment of such Revolving R-3 Facility Lender to make Revolving R-3 Facility Loans pursuant to Section 2.01(b), expressed as an amount representing the maximum aggregate permitted amount of such Revolving R-3 Facility Lender’s Revolving R-3 Facility Credit Exposure hereunder and (b) in the case of any Lender that increases its Revolving R-3 Facility Commitment or becomes an Incremental Revolving Credit Commitment Increase Lender in respect of the Revolving R-3 Facility, in each case pursuant to Section 2.21, the amount specified in the applicable Incremental Agreement, in each case as the same may be changed from time to time pursuant to terms hereof, as such commitment may be (a) reduced from time to time pursuant to Section 2.09 and (b) reduced or increased from time to time pursuant to assignments by or to such Lender under Section 9.04. The initial amount of each Revolving R-3

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Facility Lender’s Revolving R-3 Facility Commitment is the amount set forth opposite such Lender’s name on Schedule 2.01 directly below the column entitled “Revolving R-3 Facility Commitment” or in the Assignment and Acceptance pursuant to which such Revolving R-3 Facility Lender shall have assumed its Revolving R-3 Facility Commitment, as applicable. The aggregate amount of the Revolving R-3 Facility Commitments (which includes the Swingline Commitment) on the Amendment No. 2 Effective Date is $200,000,000.

“Revolving R-3 Facility Commitment Fee” shall have the meaning assigned to such term in Section 2.13(a).

“Revolving R-3 Facility Credit Exposure” shall mean, at any time, the sum of (a) the aggregate principal amount of the Revolving R-3 Facility Loans denominated in Dollars outstanding at such time, (b) the Dollar Equivalent of the aggregate principal amount of the Revolving R-3 Facility Loans denominated in Canadian Dollars outstanding at such time, (c) the Swingline Exposure at such time and (d) the Revolving L/C Exposure at such time. The Revolving R-3 Facility Credit Exposure of any Revolving R-3 Facility Lender at any time shall be the sum of (a) the aggregate principal amount of such Revolving R-3 Facility Lender’s Revolving R-3 Facility Loans denominated in Dollars outstanding at such time, (b) the Dollar Equivalent of the aggregate principal amount of Revolving R-3 Facility Lender’s Revolving R-3 Facility Loans denominated in Canadian Dollars outstanding at such time and (c) such Revolving R-3 Facility Lender’s Revolving R-3 Facility Percentage of the Swingline Exposure and Revolving L/C Exposure at such time.

“Revolving R-3 Facility Lender” shall mean a Lender with a Revolving R-3 Facility Commitment or with outstanding Revolving R-3 Facility Loans.

“Revolving R-3 Facility Loan” shall mean a Loan made by a Revolving R-3 Facility Lender pursuant to Section 2.01(b). Each Revolving R-3 Facility Loan denominated in Dollars shall be a ~~Eurodollar~~Term Benchmark Loan or an ABR Loan, and each Revolving R-3 Facility Loan denominated in Canadian Dollars shall be a BA Loan or an ABR Loan.

“Revolving R-3 Facility Maturity Date” shall mean the earlier of (a) the date that is five years following the Amendment No. 6 Effective Date and (b) the date upon which the Revolving R-3 Facility Commitments have been terminated in their entirety in accordance with this Agreement.

“Revolving R-3 Facility Outstandings” shall mean, at any time, the sum of (a) the aggregate principal amount of the Revolving R-3 Facility Loans denominated in Dollars outstanding at such time, (b) the Dollar Equivalent of the aggregate principal amount of the Revolving R-3 Facility Loans denominated in Canadian Dollars outstanding at such time, (c) the Swingline Exposure at such time and (d) the Revolving L/C Exposure at such time.

“Revolving R-3 Facility Percentage” shall mean, with respect to any Revolving R-3 Facility Lender, the percentage of the total Revolving R-3 Facility Commitments represented by such Lender’s Revolving R-3 Facility Commitment. If the Revolving R-3 Facility Commitments have terminated or expired, the Revolving R-3 Facility Percentages shall be determined based upon the Revolving R-3 Facility Commitments most recently in effect, giving effect to any assignments pursuant to Section 9.04.

“S&P” shall mean Standard & Poor’s Ratings Group, Inc. and any successor to its rating agency business.

“Sale Leaseback” means any arrangement with any Person providing for the leasing by the Canadian Borrower or any Restricted Subsidiary of any real or tangible personal property, which property has been or is to be sold or transferred by the Canadian Borrower or such Restricted Subsidiary to such Person in contemplation of such leasing.

“Satellite” shall mean any satellite owned by, leased to or for which a contract to purchase has been entered into by, the Canadian Borrower or any of its Subsidiaries, whether such satellite is in the process of manufacture, has been delivered for launch or is in orbit (whether or not in operational service).

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“Satellite Assets” shall mean orbital slots or locations, transponders, Satellites and related equipment (including TT&C Stations) associated with the conduct of the Permitted Business by the Canadian Borrower and its Subsidiaries.

“Satellite Manufacturer” shall mean, with respect to any Satellite, the prime contractor and manufacturer of such Satellite.

“Satellite Purchase Agreement” shall mean, with respect to any Satellite, the agreement between the applicable Satellite Purchaser and either (a) the applicable Satellite Manufacturer relating to the manufacture, testing and delivery of such Satellite or (b) the applicable seller relating to the purchase and sale of such Satellite.

“Satellite Purchaser” shall mean the Canadian Borrower or any Restricted Subsidiary that is a party to a Satellite Purchase Agreement or Launch Services Agreement, as the case may be.

“SEC” shall mean the Securities and Exchange Commission or any successor thereto.

“Secondary Obligations” shall mean all Secured Obligations other than Primary Obligations.

“Section 5.04 Financials” shall mean the financial statements delivered, or required to be delivered, pursuant to Section 5.04(a) or 5.04(b), together with the accompanying compliance certificate delivered, or required to be delivered, pursuant to Section 5.04(c).

“Secured Creditors” or “Secured Parties” shall mean (a) the Lenders, (b) each Cash Management Bank to which any Cash Management Obligation is owed, (c) the Administrative Agent and the Collateral Agent, (d) each L/C Issuer, (e) each Swap Counterparty, (f) the Lenders (and any Affiliates thereof) that are beneficiaries of indemnification obligations undertaken by the Loan Parties under any Loan Document and (g) the successors and permitted assigns of each of the foregoing.

“Secured Indebtedness” means any Indebtedness secured by a Lien on property or assets of the Canadian Borrower or a Restricted Subsidiary.

“Secured Obligations” shall mean (a) the Obligations, (b) the due and punctual payment and performance of all obligations of the Borrowers and the other Loan Parties under all Permitted Swap Agreements (other than with respect to any obligations under any Permitted Swap Agreements that constitute Excluded Swap Obligations with respect to a Loan Party) and (c) the due and punctual payment and performance of all Cash Management Obligations. Notwithstanding the foregoing, (i) unless otherwise agreed to by the Canadian Borrower, the obligations of a Loan Party or any Restricted Subsidiary thereof under any Cash Management Agreement and Permitted Swap Agreement shall be secured and guaranteed pursuant to the Security Documents and only to the extent that, and for so long as, the other Obligations are so secured and guaranteed, (ii) any release of Collateral or Guarantors effected in the manner permitted by this Agreement and the other Loan Documents shall not require the consent of the holders of the Cash Management Obligations under Cash Management Agreements or the consent of the holders of the Swap Obligations under Permitted Swap Agreements and (iii) Obligations shall in no event include any Excluded Swap Obligations.

“Security Agreement” shall mean that certain U.S. Security Agreement dated as of March 28, 2012 (as amended, amended and restated, supplemented and otherwise modified and in effect from time to time) among the Loan Parties organized in the United States and the Collateral Agent for the benefit of the Secured Parties.

“Security Documents” shall mean, at any time, each of the Mortgages and the Security Agreement, the Canadian Security Agreements and each of the security agreements, mortgages and other instruments and documents executed and delivered pursuant to any of the foregoing or pursuant to Section 5.10.

“Senior Notes” shall mean the Borrowers’ $550,000,000 aggregate principal amount of 6.500% Senior Notes due 2027 issued pursuant to that certain indenture dated October 11, 2019.

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“Senior Secured Leverage Ratio” shall mean, as of any date of determination, the ratio of (a) Consolidated Total Secured Debt as of the last day of the Test Period most recently ended on or prior to such date of determination, minus up to $100,000,000 of cash and Cash Equivalents of the Canadian Borrower and its Restricted Subsidiaries to the extent not designated as restricted cash on the consolidated balance sheet of the Canadian Borrower and its Restricted Subsidiaries in accordance with GAAP to (b) Consolidated EBITDA for such Test Period.

“Senior Secured Notes” shall mean the Borrowers’ $400,000,000 aggregate principal amount of 4.875% Senior Secured Notes due 2027 issued pursuant to that certain indenture dated December 6, 2019.

“Senior Secured Notes Obligations” shall mean (a) obligations of the obligors thereunder from time to time arising under or in respect of the due and punctual payment of (i) the principal of and premium, if any, and interest (including interest accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding) on the Senior Secured Notes, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, and (ii) all other monetary obligations, including fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise (including monetary obligations incurred during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding), of the obligors thereunder under the Senior Secured Notes and indenture governing the Senior Secured Notes, and (b) the due and punctual performance of all covenants, agreements, obligations and liabilities of the obligors thereunder arising under the Senior Secured Notes and indenture governing the Senior Secured Notes.

“Similar Business” means any business conducted or proposed to be conducted by the Canadian Borrower and its Restricted Subsidiaries on the Measurement Date or any business that is similar, reasonably related, incidental or ancillary thereto.

“SOFR” ~~with respect~~shall mean a rate equal to ~~any day means~~ the secured overnight financing rate ~~publishedfor such day~~as administered by the SOFR Administrator.

“SOFR Administrator” shall mean the Federal Reserve ~~Bank~~Board of New York~~, as the administrator of the benchmark~~ (or a successor administrator of the secured overnight financing rate)~~, on~~.

“SOFR Administrator’s Website” shall mean the Federal Reserve ~~Bank~~Board of New York’s ~~Website.~~website, currently at http://www.newyorkfed.org, or any successor source for the secured overnight financing rate identified as such by the SOFR Administrator from time to time.

“SOFR~~-Based~~Rate Day” ~~meansSOFR, Compounded SOFR or Term SOFR~~has the meaning specified in the definition of “Daily Simple SOFR”.

“Sold Entity or Business” shall have the meaning provided in the definition of the term “Consolidated EBITDA.”

“Solicited Discount Proration” shall have the meaning given to it in Section 2.12(f)(iv)(C).

“Solicited Discounted Prepayment Amount” shall have the meaning given to it in Section 2.12(f)(iv)(A).

“Solicited Discounted Prepayment Notice” shall mean a written notice of the Canadian Borrower or any of its Restricted Subsidiaries of Solicited Discounted Prepayment Offers made pursuant to Section 2.12(f)(iv) substantially in the form of Exhibit N-4.

“Solicited Discounted Prepayment Offer” shall mean the irrevocable written offer by each Lender, substantially in the form of Exhibit N-5, submitted following the Administrative Agent’s receipt of a Solicited Discounted Prepayment Notice.

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“Solicited Discounted Prepayment Response Date” shall have the meaning given to it in Section 2.12(f)(iv)(A).

“Specified Debt Incurrence Prepayment Event” shall have the meaning assigned to such term in Section 2.12(c).

“Specified Discount” shall have the meaning given to it in Section 2.12(f)(ii)(A).

“Specified Discount Prepayment Amount” shall have the meaning given to it in Section 2.12(f)(ii)(A).

“Specified Discount Prepayment Notice” shall mean a written notice of the Canadian Borrower or any of its Restricted Subsidiaries of a Borrower Offer of Specified Discount Prepayment made pursuant to ‎Section 2.12(f)(ii) substantially in the form of Exhibit N-6.

“Specified Discount Prepayment Response” shall mean the irrevocable written response by each Lender, substantially in the form of Exhibit N-7, to a Specified Discount Prepayment Notice.

“Specified Discount Prepayment Response Date” shall have the meaning given to it in Section 2.12(f)(ii)(A).

“Specified Discount Proration” shall have the meaning given to it in Section 2.12(f)(ii)(C).

“Specified Existing Revolving Credit Commitment Class” shall have the meaning assigned to such term in Section 2.24(b).

“Specified Transaction” shall mean, with respect to any period, any Investment, Permitted Change of Control, sale, transfer or other disposition of assets or property, incurrence, Refinancing, prepayment, redemption, repurchase, defeasance, acquisition similar payment, extinguishment, retirement or repayment of Indebtedness, distribution, dividend, Subsidiary designation, Incremental Term Loan, provision of Incremental Revolving Credit Commitment Increases, creation of Extended Term Loans or Extended Revolving Credit Commitments or other event that by the terms of the Loan Documents requires pro forma compliance” with a test or covenant hereunder or requires such test or covenant to be calculated on a pro forma basis and shall include any restructuring initiative, cost saving initiative or other similar strategic initiative of the Canadian Borrower or any of its Restricted Subsidiaries after the Amendment No. 2 Effective Date described in reasonable detail in a certificate of a Responsible Officer delivered by the Canadian Borrower to the Administrative Agent.

“Spectrum Repurposing” means the diminution of the Canadian Borrower or any Restricted Subsidiary’s rights to the use of orbital spectrum or market access rights, directly or indirectly, by any Governmental Authority, including, without limitation, the Canadian Borrower or its Restricted Subsidiary’s FCC Licenses or ISED Authorizations, directly or indirectly, as result of the FCC proceeding Expanding Flexible Use of the 3.7-4.2 GHz Band, GN Docket No. 18-122, Order and Notice of Proposed Rulemaking, 33 FCC Rcd 6915 (2018) or the ISED Canada Consultation on Revisions to the 3500 MHz Band to Accommodate Flexible Use and Preliminary Consultation on Changes to the 3800 MHz Band, ISED Canada’s Decision on Revisions to the 3500 MHz Band to Accommodate Flexible Use and Decisions on Changes to the 3800 MHz Band, or any similar proceedings.

“SPV” shall have the meaning given to it in Section 9.04(f).

“Standby Letter of Credit” has the meaning specified in Section 2.05(a).

~~“~~~~StatutoryReserves~~~~” shall mean, with respect to any currency, any reserve, liquid asset or similar requirements establishedby any Governmental Authority of the United States of America or of the jurisdiction of such currency or any jurisdiction in which Loansin such currency are made to which banks in such jurisdiction are subject for any category of deposits or liabilities customarily usedto fund loans in such currency or by reference to which interest rates applicable to Loans in such currency are determined.~~

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“Subject Agreements” shall have the meaning provided in the definition of the term Permitted Liens.

“Subject Property” shall mean, collectively, (a) any contract, license, lease, agreement, permit, instrument, security or franchise agreement or other document (a “Contract”) to which the Canadian Borrower or any Restricted Subsidiary is a party or any asset, right or property (and accessions and additions to such assets, rights or property, replacements and products thereof and customary security deposits, related Contract rights and payment intangibles) of the Canadian Borrower or a Restricted Subsidiary that is subject to a purchase money security interest, Finance Lease Obligation, similar arrangement or Contract and any of its rights or interests thereunder, in each case only to the extent and for so long as the grant of such security interest or Lien in such Contract or such asset, right or property is prohibited by or constitutes or results or would constitute or result in the invalidation, violation, breach, default, forfeiture or unenforceability of any right, title or interest of the Canadian Borrower or such Restricted Subsidiary under such Contract or purchase money, capital lease or similar arrangement or Contract or creates or would create a right of termination in favor of any other party thereto (other than the Canadian Borrower or any wholly owned Restricted Subsidiary), or requires consent not obtained of any third party (it being understood and agreed that the Borrowers and each Restricted Subsidiary shall not be required to seek any such consent), other than the proceeds thereof the assignment of which is expressly deemed effective under the UCC or any similar applicable laws notwithstanding such prohibition, (b) any Governmental Authority licenses or state or local Governmental Authority franchises, charters or authorizations, to the extent the grant of a security interest in any such licenses, franchise, charter or authorization would be prohibited or restricted by such license, franchise, charter or authorization or (c) any property to the extent that such grant of a security interest would result in the forfeiture of the Canadian Borrower’ or any Restricted Subsidiary’s rights in the property (including any legally effective prohibition or restriction).

“Submitted Amount” shall have the meaning given to it in Section 2.12(f)(iii)(A).

“Submitted Discount” shall have the meaning given to it in Section 2.12(f)(iii)(A).

“Subordinated Indebtedness” means:

(1)	with respect to the Canadian Borrower, any Indebtedness of the Canadian Borrower which is by its terms subordinated<br>in right of payment to the Loans, and

(2) with respect to any Guarantor, any Indebtedness of such Guarantor which is by its terms subordinated in right of payment to the Guarantee of such Guarantor.

“subsidiary” shall mean, with respect to any Person:

(1) any corporation, association, or other business entity (other than a partnership, joint venture, limited liability company or similar entity) of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time of determination owned or controlled, directly or indirectly, by such Person or one or more of the other subsidiaries of that Person or a combination thereof and

(2) any partnership, joint venture, limited liability company or similar entity of which:

(a) more than 50% of the capital accounts, distribution rights, total equity and voting interests or general or limited partnership interests, as applicable, are owned or controlled, directly or indirectly, by such Person or one or more of the other subsidiaries of that Person or a combination thereof whether in the form of membership, general, special or limited partnership or otherwise, and

(b) such Person or any Restricted Subsidiary of such Person is a controlling general partner or otherwise controls such entity.

“Subsidiary” shall mean, unless the context otherwise requires, a subsidiary of the Canadian Borrower.

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“Subsidiary Loan Party” shall mean (a) each Guarantor and (b) subject to the limitations in Section 5.10, each Material Subsidiary that is a Wholly Owned Subsidiary (it being understood and agreed that a Person acquired after the Amendment No. 2 Effective Date shall be considered a Material Subsidiary as of the date of such acquisition if such Person would have been a Material Subsidiary as of the end of the most recently ended Test Period if such Person had been a Subsidiary at such time).

“Successor Company” shall have the meaning assigned to such term in Section 6.03(a)(i).

“Successor Person” shall have the meaning assigned to such term in Section 6.03(b)(A)(i).

“Supported QFC” has the meaning assigned to it in Section 9.26.

“Survey” shall mean a survey of any real property subject to a Mortgage (and all improvements thereon) which is (a) (i) prepared by a surveyor or engineer licensed to perform surveys in the jurisdiction where such real property is located, (ii) dated (or redated) not earlier than six months prior to the date of delivery thereof unless there shall have occurred within six months prior to such date of delivery any material exterior construction on the site of such real property or any material easement, right of way or other interest in the real property has been granted or become effective through operation of law or otherwise with respect to such real property which, in either case, can be depicted on a survey, in which events, as applicable, such survey shall be dated (or redated) after the completion of such construction or if such construction shall not have been completed as of such date of delivery, not earlier than 30 days prior to such date of delivery, or after the grant or effectiveness of any such easement, right of way or other interest in the subject real property, (iii) certified by the surveyor (in a manner reasonably acceptable to the Administrative Agent) to the Administrative Agent, the Collateral Agent and the Title Company, (iv) complying in all material respects with the minimum detail requirements of the American Land Title Association as such requirements are in effect on the date of preparation of such survey or such other standard as is customary in the jurisdiction in which the real property is located and (v) sufficient for the Title Company without a survey exception and including all survey-related endorsements to issue a Title Policy, (b) a re-certified survey as of the date originally issued with a “no change” affidavit sufficient for the Title Company without a survey exception and including all survey-related endorsements to issue a Title Policy or (c) otherwise reasonably acceptable to the Collateral Agent.

“Swap Agreement” shall mean 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 Canadian Borrower or any of its Subsidiaries shall be a Swap Agreement.

“Swap Counterparty” shall mean any Person that is a counterparty to a Permitted Swap Agreement.

“Swap Obligations” shall mean obligations under or with respect to Swap Agreements.

“Swingline Borrowing” shall mean a Borrowing comprised of Swingline Loans.

“Swingline Borrowing Request” shall mean a request substantially in the form of Exhibit C.

“Swingline Commitment” shall mean, with respect to each Swingline Lender, the commitment of such Swingline Lender to make Swingline Loans pursuant to Section 2.04. The amount of each Swingline Lender’s Swingline Commitment on the Amendment No. 6 Effective Date is set forth on Schedule 2.04 as the same may be modified at the request of Canadian Borrower with the consent of any Revolving R-3 Facility Lender being added as a Swingline Lender and the Administrative Agent. The aggregate amount of the Swingline Commitments on the Amendment No. 6 Effective Date is $15,000,000 and the Swingline Lender as of the Amendment No. 6 Effective Date shall be Bank of Montreal.

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“Swingline Exposure” shall mean at any time the aggregate principal amount of all outstanding Swingline Borrowings at such time. The Swingline Exposure of any Revolving R-3 Facility Lender at any time shall mean its Revolving R-3 Facility Percentage of the aggregate Swingline Exposure at such time.

“Swingline Lender” shall mean JPMCB in its capacity as lender of Swingline Loans hereunder, or such other financial institution that, after the Amendment No. 2 Effective Date, shall agree to act in the capacity of lender of Swingline Loans hereunder. In the event that there is more than one Swingline Lender at any time, references herein and in the other Loan Documents to the Swingline Lender shall be deemed to refer to the Swingline Lender in respect of the applicable Swingline Loan or to all Swingline Lenders, as the context requires.

“Swingline Loans” shall mean the swingline loans made to Canadian Borrower pursuant to Section 2.04.

“Swingline Note” shall mean a promissory note, substantially in the form of Exhibit E-3 hereto, evidencing the obligation of the Canadian Borrower to repay outstanding Swingline Loans, as such note may be amended, modified, supplemented, extended, renewed or replaced from time to time.

“Swingline Termination Date” shall mean the earliest of (a) the Revolving R-3 Facility Maturity Date and (b) the date on which the Swingline Commitment is terminated in its entirety in accordance with this agreement.

“Tax Group” shall have the meaning specified in Section 6.06(b)(x)(A).

“Taxes” shall mean any and all present or future taxes, levies, imposts, duties (including stamp duties), deductions, charges (including ad valorem charges) or withholdings imposed by any Governmental Authority and any and all interest, additions to tax and penalties related thereto.

“Term B-4 Loans” shall mean each of the term loans outstanding under this agreement immediately prior to the Amendment No. 6 Effective Date.

“Term B-5 Lender” shall mean a Lender with outstanding Term B-5 Loans.

“Term B-5 Loan Borrowing” shall mean a borrowing of Term B-5 Loans.

“Term B-5 Loan Commitment” shall mean, with respect to each Lender, the Commitment (if any) of such Lender to make term loans on the Amendment No. 6 Effective Date in the amount set forth opposite such Lender’s name on Schedule 2.01 directly below the column entitled “Term B-5 Loan Commitment” or in the Assignment and Acceptance pursuant to which such Lender shall have assumed its Term B-5 Loan Commitment, as applicable, as such amount may be adjusted from time to time in accordance with this Agreement. The aggregate amount of the Term B-5 Loan Commitments on the Amendment No. 6 Effective Date was $1,908,500,000.

“Term B-5 Loan Facility” shall mean each of the Term B-5 Loan Commitments and the Term B-5 Loans.

“Term B-5 Loan Maturity Date” shall mean the date that is seven years after the Amendment No. 6 Effective Date.

“Term B-5 Loans” shall mean term loans made by the Term B-5 Lenders pursuant to Section 2.01(a). Each Term B-5 Loan shall be a ~~Eurodollar~~Term Benchmark Loan or an ABR Loan.

“Term Benchmark” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the Adjusted Term SOFR Rate (other than pursuant to clause (c) of the definition of Alternate Base Rate).

“Term Loan Commitment” shall mean a Term B-5 Loan Commitment or Incremental Term Loan Commitment, as the context may require.

“Term Loan Extension Request” shall have the meaning assigned to such term in Section 2.24(a).

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“Term Loan Facility” shall mean the Term B-5 Loan Facility and any Incremental Term Loan Facility.

“Term Loan Lender” shall mean the Term B-5 Lenders and any Incremental Term Loan Lenders.

“Term Loans” shall mean the Term B-5 Loans and any Incremental Term Loans.

“Term SOFR~~”means the forward-looking term rate based on SOFR that has been selected or recommended by the Relevant Governmental Body~~ Determination Day” has the meaning assigned to it under the definition of Term SOFR Reference Rate.

“Term SOFR Rate” shall mean, with respect to any Term Benchmark Borrowing and for any tenor comparable to the applicable Interest Period, the Term SOFR Reference Rate at approximately 5:00 a.m., Chicago time, two U.S. Government Securities Business Days prior to the commencement of such tenor comparable to the applicable Interest Period, as such rate is published by the CME Term SOFR Administrator.

“Term SOFR Reference Rate” shall mean, for any day and time (such day, the “Term SOFR Determination Day”), with respect to any Term Benchmark Borrowing and for any tenor comparable to the applicable Interest Period, the rate per annum published by the CME Term SOFR Administrator and identified by the Administrative Agent as the forward-looking term rate based on SOFR. If by 5:00 pm (New York City time) on such Term SOFR Determination Day, the “Term SOFR Reference Rate” for the applicable tenor has not been published by the CME Term SOFR Administrator and a Benchmark Replacement Date with respect to the Term SOFR Rate has not occurred, then, so long as such day is otherwise a U.S. Government Securities Business Day, the Term SOFR Reference Rate for such Term SOFR Determination Day will be the Term SOFR Reference Rate as published in respect of the first preceding U.S. Government Securities Business Day for which such Term SOFR Reference Rate was published by the CME Term SOFR Administrator, so long as such first preceding U.S. Government Securities Business Day is not more than five (5) U.S. Government Securities Business Days prior to such Term SOFR Determination Day.

“Test Period” shall mean, on any date of determination, the period of four consecutive fiscal quarters of the Canadian Borrower then most recently ended (taken as one accounting period) in respect of which Section 5.04 Financials shall have been delivered to the Administrative Agent for each fiscal quarter or fiscal year in such period; provided that, prior to the first date following the Amendment No. 2 Effective Date that Section 5.04 Financials shall have been delivered pursuant to Section 5.04(a) or (b), the Test Period in effect shall be the period of four consecutive fiscal quarters of the Canadian Borrower ended September 30, 2016. A Test Period may be designated by reference to the last day thereof (i.e. the September 30, 2016 Test Period refers to the period of four consecutive fiscal quarters of the Canadian Borrower ended September 30, 2016), and a Test Period shall be deemed to end on the last day thereof.

“The SpaceConnection, Inc.” means The SpaceConnection, Inc., a Nevada corporation, and its successors.

“Title Company” shall mean a nationally recognized title insurance company reasonably acceptable to the Administrative Agent.

“Title Policy” shall mean a policy of title insurance (or marked-up title insurance commitment having the effect of a policy of title insurance) insuring the Lien of a Mortgage as a valid first mortgage Lien on the mortgaged property and fixtures described therein in the amount equal to not less than the Fair Market Value of such mortgaged property and fixtures, issued by the Title Company which shall (A) to the extent necessary, include such reinsurance arrangements (with provisions for direct access, if necessary) as shall be reasonably acceptable to the Administrative Agent, (B) contain a “tie-in” or “cluster” endorsement, if available under applicable law at ordinary commercial rates (i.e., policies which insure against losses regardless of location or allocated value of the insured property up to a stated maximum coverage amount), (C) have been supplemented by such endorsements if available at ordinary commercial rates (or at the option of the Borrower with respect to zoning endorsements, a zoning report from a reputable zoning service or an opinion of local counsel sufficient to establish that the Mortgaged Property is in material compliance with applicable zoning laws and ordinances) as shall be reasonably requested by the Administrative Agent (including endorsements on matters relating to usury, first loss, last dollar, zoning, contiguity, revolving credit, doing business, address, leasehold public road access, survey, variable rate, environmental lien,

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subdivision, mortgage recording tax, separate tax lot, revolving credit and so-called comprehensive coverage over covenants and restrictions), and (D) contain no exceptions to title other than Liens permitted hereunder or as may otherwise be permitted by the Administrative Agent.

“Total Assets” means the total assets of the Canadian Borrower and the Restricted Subsidiaries, as shown on the most recent balance sheet of the Canadian Borrower and its Restricted Subsidiaries provided to the Administrative Agent and the Lenders, in conformity with GAAP

“Total Leverage Ratio” shall mean, as of any date of determination, the ratio of (a) Consolidated Total Debt as of the last day of the Test Period most recently ended on or prior to such date of determination, minus up to $100,000,000 of cash and Cash Equivalents of the Canadian Borrower and its Restricted Subsidiaries to the extent not designated as restricted cash on the consolidated balance sheet of the Canadian Borrower and its Restricted Subsidiaries in accordance with GAAP to (b) Consolidated EBITDA for such Test Period.

“Trade Letter of Credit” shall have the meaning specified in Section 2.05(a).

“Transaction Expenses” shall mean any fees or expenses incurred or paid by the Canadian Borrower or any of its Subsidiaries in connection with the Transactions, this Agreement and the other Loan Documents and the transactions contemplated hereby and thereby.

“Transactions” shall mean, collectively, the (a) the execution and delivery of the Loan Documents and the making of the initial Borrowings hereunder, (b) the Existing Debt Refinancing, (c) the consummation of any other transactions in connection with the foregoing, and (d) the payment of all fees and expenses to be paid on or prior to the Amendment No. 6 Effective Date and owing in connection with the foregoing.

“Transferred Guarantor” shall have the meaning assigned to such term in Section 10.09.

“Transformative Acquisition” shall mean any acquisition by the Canadian Borrower or any Restricted Subsidiary that is either (a) not permitted by the terms of this Agreement immediately prior to the consummation of such acquisition or (b) if permitted by the terms of this Agreement immediately prior to the consummation of such acquisition, would not provide the Canadian Borrower and its Restricted Subsidiaries with adequate flexibility under this Agreement for the continuation and/or expansion of their combined operations following such consummation, as determined by the Canadian Borrower acting in good faith.

“TT&C Station” shall mean an earth station operated by the Canadian Borrower or any of its Restricted Subsidiaries for the purpose of providing tracking, telemetry, control and monitoring of any Satellite.

“TWEA” shall have the meaning given to it in Section 3.21(a).

“Type,” when used in respect of any Loan or Borrowing, shall refer to the Rate by reference to which interest on such Loan or on the Loans comprising such Borrowing is determined or, in the case of any BA Loan or BA Borrowing, the Rate by reference to which the BAs comprising such BA Loans or BA Borrowing are discounted for purposes of calculating the Discount Proceeds. For purposes hereof, the term “Rate” shall include the Adjusted ~~LIBO~~Term SOFR Rate, the BA Discount Rate and the Alternate Base Rate.

“UCC” shall mean the Uniform Commercial Code as in effect in any applicable jurisdiction.

“UCP” shall have the meaning specified in Section 2.05(j).

“Unadjusted Benchmark Replacement” means the Benchmark Replacement excluding the Benchmark Replacement Adjustment; provided that, if the Unadjusted Benchmark Replacement as so determined would be less than zero, the Unadjusted Benchmark Replacement will be deemed to be zero for the purposes of this Agreement.

“Unpaid Drawing” shall have the meaning specified in Section 2.23(a)(iv).

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“Unreimbursed Amount” shall have the meaning specified in Section 2.05(e)(iv).

“Unrestricted Subsidiary” shall mean (a) any Subsidiary of the Canadian Borrower that is formed or acquired after the Closing Date; provided that at such time (or promptly thereafter) the Canadian Borrower designates such Subsidiary an Unrestricted Subsidiary in a written notice to the Administrative Agent, (b) any Restricted Subsidiary subsequently re-designated as an Unrestricted Subsidiary by the Canadian Borrower in a written notice to the Administrative Agent; provided that in the case of (a) and (b), (x) such designation or re-designation shall be deemed to be an Investment on the date of such designation or re-designation in an Unrestricted Subsidiary in an amount equal to the sum of (i) the Canadian Borrower’ direct or indirect equity ownership percentage of the net worth of such designated or re-designated Restricted Subsidiary immediately prior to such designation or re-designation (such net worth to be calculated without regard to any guarantee provided by such designated or re-designated Restricted Subsidiary) and (ii) the aggregate principal amount of any Indebtedness owed by such designated or re-designated Restricted Subsidiary to the Canadian Borrower or any other Restricted Subsidiary immediately prior to such designation or re-designation, all calculated, except as set forth in the parenthetical to clause (i), on a consolidated basis in accordance with GAAP and (y) no Default or Event of Default would result from such designation or re-designation, (c) each Subsidiary of an Unrestricted Subsidiary and (d) 10680451 Canada, Inc., Telesat U.S. Services Holdings Corporation and Telesat U.S. Services, LLC; provided that any such Subsidiary shall cease to be an Unrestricted Subsidiary if the Board of Directors designates such Subsidiary as a Restricted Subsidiary as set forth below; provided, however, that at the time of any written designation or re-designation by the Canadian Borrower to the Administrative Agent that any Unrestricted Subsidiary shall no longer constitute an Unrestricted Subsidiary, such Unrestricted Subsidiary shall cease to be an Unrestricted Subsidiary to the extent no Default or Event of Default would result from such designation or re-designation. For the avoidance of doubt, upon any designation of any Unrestricted Subsidiary as a Restricted Subsidiary (but without duplication of any amount reducing such Investment in such Unrestricted Subsidiary, or otherwise increasing, pursuant to the definition of “Investment” or the definition of “Applicable Amount”), the Canadian Borrower and/or the applicable Restricted Subsidiaries shall receive a credit against the applicable clause in the definition of Permitted Investments or Section 6.06 that was utilized for the Investment in such Unrestricted Subsidiary for all returns in cash or Cash Equivalents in respect of such Investment.

“Unrestricted Subsidiary Support Transactions” means transactions, agreements and arrangements entered into and performed by (a) the Canadian Borrower and any of its Restricted Subsidiaries and (b) any Unrestricted Subsidiary pursuant to which the Canadian Borrower and any of its Restricted Subsidiaries provide a common salesforce (including cross-selling) and/or selling, general and administrative services, including employment and related services, to such Unrestricted Subsidiary, in each case, at a cost of not less than 105% of the cost incurred by the Canadian Borrower or the relevant Restricted Subsidiary related to such service.

“U.S. Bankruptcy Code” shall mean Title 11 of the United States Code, as amended, or any similar federal or state law for the relief of debtors.

“U.S. Borrower” shall have the meaning assigned to such term in the introductory paragraph of this Agreement and shall include, if applicable, any Successor Person with or into which the U.S. Borrower merges, amalgamates or consolidates in accordance with Section 6.03.

“U.S. Government Securities Business Day” shall mean any day except for (i) a Saturday, (ii) a Sunday or (iii) a day on which the Securities Industry and Financial Markets Association recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities.

“U.S. Special Resolution Regimes” has the meaning assigned to it in Section 9.26.

“Voting Stock” of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the Board of Directors of such Person; provided, however, that, with respect to the Canadian Borrower, the term “Voting Stock” shall not include preferred shares of the Canadian Borrower that have a nominal dividend and return of capital and vote only for the election of directors, for so long as such shares are held

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and voted by directors nominated by a committee consisting of members of the Board of Directors of the Canadian Borrower or by PSP or by Loral.

“Weighted Average Life to Maturity” shall mean, when applied to any Indebtedness at any date, the number of years obtained by dividing (a) the sum of the products obtained by multiplying (i) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect thereof, by (ii) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment; by (b) the then outstanding principal amount of such Indebtedness.

“Wholly Owned Subsidiary” of any Person means a Subsidiary of such Person, 100% of the outstanding Capital Stock or other ownership interests of which (other than directors’ qualifying shares) shall at the time be owned by such Person or by one or more Wholly Owned Subsidiaries of such Person or would be owned upon exchange of all outstanding securities of such Person in accordance with their terms.

“Withdrawal Liability” shall mean liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.

“Withholding Agent” means any Loan Party, the Administrative Agent and any other applicable withholding agent.

“Write-Down and Conversion Power” shall mean, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.

“WURA” shall mean the Winding-Up and Restructuring Act (Canada), as amended.

Section 1.02 Terms Generally.

(a) The definitions set forth or referred to in Section 1.01 shall apply equally to both the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.” The words “herein,” “hereto,” “hereof” and “hereunder” and words of similar import when used in any Loan Document shall refer to such Loan Document as a whole and not to any particular provision thereof. The term “documents” includes any and all instruments, documents, agreements, certificates, notices, reports, financial statements and other writings, however evidenced, whether in physical or electronic form. Any reference to any Person shall be constructed to include such Person’s successors or assigns (subject to any restrictions on assignment set forth herein) and, in the case of any Governmental Authority, any other Governmental Authority that shall have succeeded to any or all of the functions thereof. All references herein to Articles, Sections, Exhibits and Schedules shall be deemed references to Articles and Sections of, and Exhibits and Schedules to, this Agreement unless the context shall otherwise require. Except as otherwise expressly provided herein, any reference in this Agreement to any Loan Document shall mean such document as amended, restated, supplemented or otherwise modified from time to time. In the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including”; the words “to” and “until” each mean “to but excluding”; and the word “through” means “to and including.” The word “will” shall be construed to have the same meaning as the word “shall.”

(b) Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be construed in accordance with GAAP, as in effect from time to time; provided that, if the Canadian Borrower notifies the Administrative Agent that (a) the Canadian Borrower is changing any accounting or reporting practice permitted or required under GAAP or (b) the Canadian Borrower requests an amendment to any provision hereof to eliminate the effect of any change occurring after the Amendment No. 2 Effective Date in GAAP or in the application thereof on the operation of such provision (or if the Administrative Agent notifies the Canadian Borrower that the Required Lenders request an amendment to any provision hereof for such purpose), regardless of whether

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any such notice is given before or after such change in practice or in GAAP or in the application thereof, then such provision shall be interpreted on the basis of GAAP as in effect and applied immediately before such change shall have become effective until such notice shall have been withdrawn or such provision amended in accordance herewith.

Section 1.03 Exchange Rates.

(a)

(i) For purposes of determining any provision of Section 2 of this Agreement requiring the use of a current exchange rate, not later than 1:00 p.m., New York City time, on each Calculation Date, the Administrative Agent shall (x) determine the Exchange Rate as of such Calculation Date and (y) give notice thereof to the applicable Borrower. The Exchange Rates so determined shall become effective on the first Business Day immediately following the relevant Calculation Date (a “Reset Date”), shall remain effective until the next succeeding Reset Date, and shall for all purposes of this Agreement (other than any other provision expressly requiring the use of an Exchange Rate calculated as of a specified date) be the Exchange Rates employed in converting any amounts between Dollars and Canadian Dollars.

(ii) Not later than 5:00 p.m., New York City time, on each Reset Date, the Administrative Agent shall (x) determine the aggregate amount of the Dollar Equivalents or Canadian Dollar Equivalents, as applicable, of the principal amounts of the Revolving R-3 Facility Loans and Swingline Loans then outstanding (after giving effect to any Revolving R-3 Facility Loans and Swingline Loans made or repaid on such date) and the Revolving L/C Exposure and (y) notify the Lenders, each L/C Issuer and the applicable Borrower of the results of such determination.

(b) For purposes of any determination under Section 5, Section 6 or Section 7 or any determination under any other provision of this Agreement (other than Section 2) requiring the use of a current exchange rate, all amounts incurred or proposed to be incurred in currencies other than Dollars shall be translated into Dollars at the Exchange Rate then in effect on the date of such determination; provided, however, that (i) for purposes of determining compliance with Section 6 with respect to the amount of any Indebtedness, Investment, disposition, dividend or payment in a currency other than Dollars, no Default or Event of Default shall be deemed to have occurred solely as a result of changes in rates of exchange occurring after the time such Indebtedness or Investment is incurred or disposition dividend or payment is made, (ii) for purposes of determining compliance with any Dollar-denominated restriction on the incurrence of Indebtedness, if such Indebtedness is incurred to Refinance other Indebtedness denominated in a foreign currency, and such Refinancing would cause the applicable Dollar-denominated restriction to be exceeded if calculated at the relevant currency Exchange Rate in effect on the date of such Refinancing, such Dollar-denominated restriction shall be deemed not to have been exceeded so long as the principal amount of the Indebtedness that is incurred to Refinance such Indebtedness does not exceed the principal amount (or accreted amount) of such Indebtedness being Refinanced, except by an amount equal to the accrued interest, dividends and premium (including tender premiums), if any, thereon plus defeasance costs, underwriting discounts and other amounts paid and fees and expenses (including OID, closing payments, upfront fees and similar fees) incurred in connection with such Refinancing plus an amount equal to any existing commitment unutilized and letters of credit undrawn thereunder and (iii) for the avoidance of doubt, the foregoing provisions of this Section 1.03(b) shall otherwise apply to such Sections, including with respect to determining whether any Indebtedness or Investment may be incurred or disposition, dividend or payment may be made at any time under such Sections. Each provision of this Agreement shall be subject to such reasonable changes of construction as the Administrative Agent may from time to time specify with the Canadian Borrower’s consent (such consent not to be unreasonably withheld) to appropriately reflect a change in currency of any country and any relevant market conventions or practices relating to such change in currency.

Section 1.04 Effectuation of Transactions. Each of the representations and warranties of the Borrowers contained in this Agreement (and all corresponding definitions) are made after giving effect to the Transactions and the other events described in the recitals to this Agreement, unless the context otherwise requires.

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Section 1.05 Divisions. For all purposes under the Loan Documents, in connection with any division or plan of division under Delaware law (or any comparable event under a different jurisdiction’s laws): (a) if any asset, right, obligation or liability of any Person becomes the asset, right, obligation or liability of a different Person, then it shall be deemed to have been transferred from the original Person to the subsequent Person, and (b) if any new Person comes into existence, such new Person shall be deemed to have been organized and acquired on the first date of its existence by the holders of its Equity Interests at such time.

Section 1.06 Limited Condition Transactions.

When calculating the availability under any basket or ratio under this Agreement or compliance with any provision of this Agreement in connection with any Limited Condition Transaction and any actions or transactions related thereto (including acquisitions, Permitted Investments, the incurrence or issuance of Indebtedness, Disqualified Capital Stock or preferred stock and the use of proceeds thereof, the incurrence of Liens, repayments, Restricted Payments and Asset Sales), in each case, at the option of the Canadian Borrower (the Canadian Borrower’s election to exercise such option, an “LCT Election”), the date of determination for availability under any such basket or ratio and whether any such action or transaction is permitted (or any requirement or condition therefor is complied with or satisfied (including as to the absence of any continuing Default or Event of Default)) under this Agreement shall be deemed to be the date (the “LCT Test Date”) either (a) the definitive agreements for such Limited Condition Transaction are entered into (or, if applicable, the date of delivery of an irrevocable notice, declaration of a Restricted Payment or similar event), or (b) solely in connection with an acquisition to which the United Kingdom City Code on Takeovers and Mergers applies, the date on which a “Rule 2.7 announcement” of a firm intention to make an offer is published on a regulatory information service in respect of a target of a Limited Condition Transaction and, in each case, if, after giving pro forma effect to the Limited Condition Transaction and any actions or transactions related thereto (including acquisitions, Permitted Investments, the incurrence or issuance of Indebtedness, Disqualified Capital Stock or preferred stock and the use of proceeds thereof, the incurrence of Liens, repayments, Restricted Payments and Asset Sales) and any related pro forma adjustments, the Canadian Borrower or any of its Restricted Subsidiaries would have been permitted to take such actions or consummate such transactions on the relevant LCT Test Date in compliance with such ratio, test or basket (and any related requirements and conditions), such ratio, test or basket (and any related requirements and conditions) shall be deemed to have been complied with (or satisfied) for all purposes (in the case of Indebtedness, for example, whether such Indebtedness is committed, issued or incurred at the LCT Test Date or at any time thereafter); provided that (a) if financial statements for one or more subsequent fiscal quarters shall have become available, the Canadian Borrower may elect, in its sole discretion, to redetermine all such ratios, tests or baskets on the basis of such financial statements, in which case, such date of redetermination shall thereafter be deemed to be the applicable LCT Test Date for purposes of such ratios, tests or baskets and (b) except as contemplated in the foregoing clause (a), compliance with such ratios, tests or baskets (and any related requirements and conditions) shall not be determined or tested at any time after the applicable LCT Test Date for such Limited Condition Transaction and any actions or transactions related thereto (including acquisitions, Permitted Investments, the incurrence or issuance of Indebtedness, Disqualified Capital Stock or preferred stock and the use of proceeds thereof, the incurrence of Liens, repayments, Restricted Payments and Asset Sale Events).

For the avoidance of doubt, if the Canadian Borrower has made an LCT Election, (1) if any of the ratios, tests or baskets for which compliance was determined or tested as of the LCT Test Date would at any time after the LCT Test Date have been exceeded or otherwise failed to have been complied with as a result of fluctuations in any such ratio, test or basket, including due to fluctuations in Consolidated EBITDA or Total Assets of the Canadian Borrower or the Person subject to such Limited Condition Transaction, such baskets, tests or ratios will not be deemed to have been exceeded or failed to have been complied with as a result of such fluctuations; (2) if any related requirements and conditions (including as to the absence of any continuing Default or Event of Default) for which compliance or satisfaction was determined or tested as of the LCT Test Date would at any time after the LCT Test Date not have been complied with or satisfied (including due to the occurrence or continuation of an Default or Event of Default), such requirements and conditions will not be deemed to have been failed to be complied with or satisfied (and such Default or Event of Default shall be deemed not to have occurred or be continuing); and (3) in calculating the availability under any ratio, test or basket in connection with any action or transaction unrelated to such Limited Condition Transaction following the relevant LCT Test Date and prior to the earlier of the date on which such Limited Condition Transaction is consummated or the date that the definitive agreement or date for redemption, purchase or repayment specified in an irrevocable notice for such Limited Condition Transaction is

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terminated, expires or passes, as applicable, without consummation of such Limited Condition Transaction, any such ratio, test or basket shall be determined or tested giving pro forma effect to such Limited Condition Transaction.

Section 1.07 Pro Forma and Other Calculations.

(a) Notwithstanding anything to the contrary herein, financial ratios and tests (including measurements of Total Assets or Consolidated EBITDA), including the First Lien Leverage Ratio, Senior Secured Leverage Ratio and Total Leverage Ratio shall be calculated in the manner prescribed by this Section 1.07; provided that, notwithstanding anything to the contrary in clauses (b), (c), (d) or (e) of this Section 1.07, when calculating the First Lien Leverage Ratio and Total Leverage Ratio, as applicable, for purposes of (i) the definitions of “Applicable Margin” and “Commitment Fee Rate,” and (ii) Section 2.12(c) and Section 2.12(d), the events described in this Section 1.07 that occurred subsequent to the end of the applicable Test Period shall not be given pro forma effect; provided, however, that for purposes of any determination under the proviso to Section 2.12(d), the First Lien Leverage Ratio shall be determined after giving pro forma effect to any voluntary prepayments of Term Loans made pursuant to Section 2.12 after the end of the Canadian Borrower’ most recently ended full fiscal year and prior to the date of the applicable payment to be made pursuant to such Section 2.12(d) assuming such prepayments had been made on the last day of such fiscal year. In addition, whenever a financial ratio or test is to be calculated on a pro forma basis or requires pro forma compliance, the reference to “Test Period” for purposes of calculating such financial ratio or test shall be deemed to be a reference to, and shall be based on, the most recently ended Test Period for which Section 5.04 Financials have been delivered.

(b) For purposes of calculating any financial ratio or test (including Total Assets or Consolidated EBITDA), Specified Transactions (with any incurrence or Refinancing of any Indebtedness in connection therewith to be subject to clause (d) of this Section 1.07) that have been made (i) during the applicable Test Period or (ii) subsequent to such Test Period and prior to or simultaneously with the event for which the calculation of any such ratio is made shall be calculated on a pro forma basis assuming that all such Specified Transactions (and any increase or decrease in Consolidated EBITDA and the component financial definitions used therein attributable to any Specified Transaction) had occurred on the first day of the applicable Test Period (or, in the case of Total Assets or “unrestricted” cash and Cash Equivalents, on the last day of the applicable Test Period). If, since the beginning of any applicable Test Period, any Person that subsequently became a Restricted Subsidiary or was merged, amalgamated or consolidated with or into the Canadian Borrower or any Restricted Subsidiary since the beginning of such Test Period shall have made any Specified Transaction that would have required adjustment pursuant to this Section 1.07, then such financial ratio or test (including Total Assets and Consolidated EBITDA) shall be calculated to give pro forma effect thereto in accordance with this Section 1.07.

(c) Whenever pro forma effect or a determination of pro forma compliance is to be given to a Specified Transaction, the pro forma calculations shall be made in good faith by a Responsible Officer of the Canadian Borrower and may include, for the avoidance of doubt, the amount of “run rate” cost savings, operating expense reductions and cost synergies and other synergies projected by the Canadian Borrower in good faith to result from or relating to any Specified Transaction (including the Transactions) that is being given pro forma effect or for which a determination of pro forma compliance is being made that have been realized or are expected to be realized and for which the actions necessary to realize such cost savings, operating expense reductions, cost synergies or other synergies have been taken, have been committed to be taken, with respect to which substantial steps have been taken or which are expected to be taken (in the good faith determination of the Canadian Borrower) (calculated on a pro forma basis as though such cost savings, operating expense reductions, cost synergies and other synergies had been realized on the first day of such period and as if such cost savings, operating expense reductions, cost synergies and other synergies were realized during the entirety of such period and “run rate” means the full recurring benefit for a period that is associated with any action taken, any action committed to be taken, any action with respect to which substantial steps have been taken or any action that is expected to be taken net of the amount of actual benefits realized during such period from such actions, and any such adjustments shall be included in the initial pro forma calculations of such financial ratios or tests and during any subsequent Test Period in which the effects thereof are expected to be realized) relating to such Specified Transaction, and any such adjustments included in the initial pro forma calculations shall continue to apply to subsequent calculations of such financial ratios or tests, including during any subsequent test periods in which the effects thereof are expected to be realizable; provided that (i) such amounts are reasonably identifiable in the good faith judgment of the Canadian Borrower, (ii) such actions are taken, such actions are committed to be taken, substantial steps with respect to such action have been taken or such actions

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are expected to be taken no later than six fiscal quarters after the date of consummation of such Specified Transaction and (iii) no amounts shall be added to the extent duplicative of any amounts that are otherwise added back in computing Consolidated EBITDA (or any other components thereof), whether through a pro forma adjustment or otherwise, with respect to such period; provided, further, that the aggregate amount of all such pro forma adjustments pursuant to this clause (c), clause (f) below or clause (l) of the definition of “Consolidated EBITDA” in any Test Period shall not exceed 20% of Consolidated EBITDA for such Test Period (in each case, calculated before giving effect to any such adjustment).

(d) In the event that the Canadian Borrower or any Restricted Subsidiary incurs (including by assumption or guarantee) or Refinances (including by redemption, repurchase, repayment, retirement or extinguishment) any Indebtedness, in each case included in the calculations of any financial ratio or test, (i) during the applicable Test Period or (ii) subsequent to the end of the applicable Test Period and prior to or simultaneously with the event for which the calculation of any such ratio is made, then such financial ratio or test shall be calculated giving pro forma effect to such incurrence or Refinancing of Indebtedness (including pro forma effect to the application of the net proceeds therefrom), in each case to the extent required, as if the same had occurred on the last day of the applicable Test Period; provided that, with respect to any incurrence of Indebtedness permitted by the provisions of this Agreement in reliance on the pro forma calculation of the First Lien Leverage Ratio, the Senior Secured Leverage Ratio and/or the Total Leverage Ratio, as applicable, shall not give pro forma effect to any Indebtedness being incurred (or expected to be incurred) substantially simultaneously or contemporaneously with the incurrence of any such Indebtedness in reliance on any “basket” set forth in this Agreement (including any “baskets” measured as a percentage of Total Assets or Consolidated EBITDA) including any Credit Event under the Revolving R-3 Facility.

(e) Whenever pro forma effect is to be given to a pro forma event, the pro forma calculations shall be made in good faith by a Responsible Officer of the Canadian Borrower. Interest on a Finance Lease Obligation shall be deemed to accrue at an interest rate reasonably determined by a Responsible Officer of the Canadian Borrower to be the rate of interest implicit in such Finance Lease Obligation in accordance with GAAP. Interest on Indebtedness that may optionally be determined at an interest rate based upon a factor of a prime or similar rate, a ~~eurocurrency~~applicable interbank offered rate, or other rate, shall be determined to have been based upon the rate actually chosen, or if none, then based upon such optional rate chosen as the Canadian Borrower or applicable Restricted Subsidiary may designate. For purposes of making the computations referred to above, interest on any Indebtedness under a revolving credit facility computed on a pro forma basis shall be computed based upon the average daily balance of such Indebtedness during the applicable period or, if lower, the maximum commitments under such revolving credit facility, except as set forth in Section 1.07(d).

(f) Any such pro forma calculation may include, without limitation, adjustments calculated in accordance with Regulation S-X under the Securities Act; provided that the aggregate amount of all such pro forma adjustments pursuant to this clause (f), clause (c) above or clause (l) of the definition of “Consolidated EBITDA” in any Test Period shall not exceed 20% of Consolidated EBITDA for such Test Period (in each case, calculated before giving effect to any such adjustment).

(g) The Canadian Borrower may elect to treat all or any portion of a revolving commitment under any credit facility as incurred and outstanding Indebtedness for borrowed money at the time of such election and for so long as such revolving commitments remain outstanding, regardless of whether fully drawn at the time of such election. As a result of any such election, any subsequent incurrence of Indebtedness under such revolving commitment shall not be deemed an incurrence of additional Indebtedness or an additional Lien at such subsequent time. As of the Measurement Date, the First Lien Leverage Ratio, the Senior Secured Leverage Ratio and the Total Leverage Ratio will be calculated using a Canadian Dollar Equivalent for Consolidated First Lien Secured Debt, Consolidated Total Secured Debt, and Consolidated Total Debt, as applicable. If the Canadian Borrower changes its functional currency to U.S. dollars, the First Lien Leverage Ratio, the Senior Secured Leverage Ratio and the Total Leverage Ratio will be calculated using a U.S. dollar equivalent for Consolidated First Lien Secured Debt, Consolidated Total Secured Debt, and Consolidated Total Debt, as applicable.

Section 1.08 Interest Rates; ~~LIBOR~~Benchmark Notification. The interest rate on a Loan ~~denominated in Dollars or Canadian Dollars~~ may be derived from an interest rate benchmark that may be discontinued or is, or may in

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the future become, the subject of regulatory reform. ~~Regulators have signaled the need to use alternative benchmark reference ratesfor some of these interest rate benchmarks and, as a result, such interest rate benchmarks may cease to comply with applicable laws andregulations, may be permanently discontinued, and/or the basis on which they are calculated may change. The London interbank offeredrate is intended to represent the rate at which contributing banks may obtain short-term borrowings from each other in the London interbankmarket. In July 2017, the U.K. Financial Conduct Authority announced that, after the end of 2021, it would no longer persuade or compelcontributing banks to make rate submissions to the ICE Benchmark Administration (together with any successor to the ICE Benchmark Administrator,the “~~~~IBA~~~~”) for purposes of the IBA setting the London interbank offered rate. Asa result, it is possible that commencing in 2022, the London interbank offered rate may no longer be available or may no longer be deemedan appropriate reference rate upon which to determine the interest rate on Eurodollar Loans. In light of this eventuality, public andprivate sector industry initiatives are currently underway to identify new or alternative reference rates to be used in place of theLondon interbank offered rate.~~ Upon the occurrence of a Benchmark Transition Event ~~oran Early Opt-In Election~~, Section 2.15(b) provides a mechanism for determining an alternative rate of interest. The ~~AdministrativeAgent will promptly notify the Canadian Borrower, pursuant to Section 2.15(d), of any change to the reference rate upon which the interestrate on Eurodollar Loans is based. However, the~~ Administrative Agent does not warrant or accept any responsibility for, and shall not have any liability with respect to, the administration, submission, performance or any other matter related to ~~the London interbank offered~~any interest rate ~~or other rates~~used in ~~the definition of LIBO Rate~~this Agreement, or with respect to any alternative or successor rate thereto, or replacement rate thereof ~~(~~, including, without limitation, ~~(i) any such alternative, successor or replacement rate~~ ~~implementedpursuant to~~~~Section 2.15(b), whether upon the occurrence of a Benchmark TransitionEvent or an Early Opt-in Election, and (ii) the implementation of any Benchmark Replacement~~ ~~ConformingChanges pursuant to Section 2.15(c)), including without limitation,~~whether the composition or characteristics of any such alternative, successor or replacement reference rate will be similar to, or produce the same value or economic equivalence of, the ~~LIBO Rate~~existing interest rate being replaced or have the same volume or liquidity as did ~~the London interbank offered~~any existing interest rate prior to its discontinuance or unavailability. The Administrative Agent and its affiliates and/or other related entities may engage in transactions that affect the calculation of any interest rate used in this Agreement or any alternative, successor or alternative rate (including any Benchmark Replacement) and/or any relevant adjustments thereto, in each case, in a manner adverse to the Borrowers. The Administrative Agent may select information sources or services in its reasonable discretion to ascertain any interest rate used in this Agreement, any component thereof, or rates referenced in the definition thereof, in each case pursuant to the terms of this Agreement, and shall have no liability to the Borrowers, any Lender or any other person or entity for damages of any kind, including direct or indirect, special, punitive, incidental or consequential damages, costs, losses or expenses (whether in tort, contract or otherwise and whether at law or in equity), for any error or calculation of any such rate (or component thereof) provided by any such information source or service.

ARTICLE II

THE CREDITS

Section 2.01 Commitments. Subject to the terms and conditions set forth herein, each Lender agrees:

(a) to make Term B-5 Loans to the Canadian Borrower in Dollars in an amount not to exceed its Term B-5 Loan Commitment; provided that (i) all such Term B-5 Loans shall be incurred by the Canadian Borrower pursuant to one drawing on the Amendment No. 6 Effective Date and (ii) any Term B-5 Loan that is repaid may not be reborrowed; and

(b) severally, and not jointly, to make Revolving R-3 Facility Loans to the Canadian Borrower from time to time during the Revolving Availability Period in an aggregate principal amount that will not result in (A) such Lender’s Revolving R-3 Facility Credit Exposure exceeding such Lender’s Revolving R-3 Facility Commitment or (B) the Revolving R-3 Facility Credit Exposure exceeding the total Revolving R-3 Facility Commitments, such Revolving R-3 Facility Loans to be made in Canadian Dollars or Dollars, at the election of the Canadian Borrower, within the foregoing limits and subject to the terms and conditions set forth herein, the Canadian Borrower may borrow, prepay and reborrow Revolving R-3 Facility Loans.

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Section 2.02 Notice to Lenders; Funding of Loans.

(a) Each Loan shall be made as part of a Borrowing consisting of Loans under the same Facility and of the same Type made by the Lenders ratably in accordance with their respective Commitments under the applicable Facility; provided, however, that Revolving R-3 Facility Loans shall be made by the Revolving R-3 Facility Lenders ratably in accordance with their respective Revolving R-3 Facility Percentages on the date such Loans are made hereunder. The failure of any Lender to make any Loan required to be made by it shall not relieve any other Lender of its obligations hereunder; provided that the Commitments of the Lenders are several and no Lender shall be responsible for any other Lender’s failure to make Loans as required.

(b) Subject to Section 2.15, (i) each Borrowing denominated in Dollars shall be comprised entirely of ABR Loans or ~~Eurodollar~~Term Benchmark Loans as the Canadian Borrower may request in accordance herewith and (ii) each Borrowing denominated in Canadian Dollars shall be comprised entirely of BA Loans or Canadian Prime Rate Loans. Each Swingline Borrowing shall be an ABR Borrowing. Each Lender at its option may make any ABR Loan, ~~Eurodollar~~Term Benchmark Loan or BA Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise of such option shall not affect the obligation of the Canadian Borrower to repay such Loan in accordance with the terms of this Agreement and such Lender shall not be entitled to any amounts payable under Section 2.16 or 2.18 solely in respect of increased costs resulting from such exercise and existing at the time of such exercise.

(c) At the commencement of each Interest Period for any ~~Eurodollar~~Term Benchmark Revolving Borrowing, such Borrowing shall be in an aggregate amount that is an integral multiple of the Borrowing Multiple and not less than the Borrowing Minimum. At the time that each ABR Revolving Borrowing is made, such Borrowing shall be in an aggregate amount that is an integral multiple of the Borrowing Multiple and not less than the Borrowing Minimum; provided that an ABR Revolving Borrowing may be in an aggregate amount that is equal to the entire unused balance of the Revolving R-3 Facility Commitments or that is required to finance the reimbursement of a L/C Disbursement as contemplated by Section 2.05(e). Each Swingline Borrowing shall be in an amount that is an integral multiple of the Borrowing Multiple and not less than the Borrowing Minimum. Borrowings of more than one Type and under more than one Facility may be outstanding at the same time; provided that there shall not at any time be more than a total of (i) 10 ~~Eurodollar~~Term Benchmark Borrowings outstanding under the Term B-5 Loan Facility, (ii) 10 ~~Eurodollar~~Term Benchmark Borrowings outstanding under the Revolving R-3 Facility and (iii) 10 BA Contract Periods with respect to BA Borrowings; provided that the number of ~~Eurodollar~~Term Benchmark Borrowings and/or BA Contract Periods may be increased or adjusted by agreement between the Canadian Borrower and the Administrative Agent in connection with any Incremental Facility or Extended Loans/Commitments.

(d) Notwithstanding any other provision of this Agreement, no Borrower shall be entitled to request, or to elect to convert or continue, any Borrowing if the Interest Period requested with respect thereto would end after the Revolving R-3 Facility Maturity Date or Term B-5 Loan Maturity Date, as applicable.

Section 2.03 Requests for Borrowings.

(a) Borrowings Other Than Swingline Loans, Etc.. Except in the case of Swingline Loans and L/C Borrowings, the Canadian Borrower shall give the Administrative Agent a Borrowing Request not later than (x) with respect to a BA or ~~Eurodollar~~Term Benchmark Borrowing, 1:00 P.M. the third Business Day before the date of the proposed Borrowing ~~(unlessthe Canadian Borrower wishes to request an Interest Period for such Borrowing other than one, two, three or six months in duration asprovided in the definition of “~~~~Interest Period~~~~,” in which case the Canadian Borrowershall give such notice on the fourth Business Day before each such Eurodollar Borrowing)~~ and (y) with respect to a Canadian Prime Rate or ABR Borrowing, not later than 11:00 A.M., on the date of the proposed borrowing, specifying:

(i) whether the requested Borrowing is to be a Revolving R-3 Facility Borrowing, Term B-5 Loan Borrowing or Incremental Term Loan;

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(ii) the aggregate amount of the requested Borrowing (expressed in Dollars or Canadian Dollars, as applicable);

(iii) the date of such Borrowing, which shall be a Business Day;

(iv) in the case of a Borrowing denominated in Dollars, whether such Borrowing is to be an ABR Borrowing or a ~~Eurodollar~~Term Benchmark Borrowing;

(v) in the case of a ~~Eurodollar~~Term Benchmark Borrowing, the initial Interest Period to be applicable thereto, which shall be a period contemplated by clause (a) of the definition of the term “Interest Period”;

(vi) in the case of a Revolving R-3 Facility Borrowing in Canadian Dollars, whether such Borrowing is to be a BA Borrowing or Canadian Prime Rate Borrowing;

(vii) in the case of a BA Borrowing, the initial Interest Period to be applicable thereto, which shall be a period contemplated by the definition of the term “BA Contract Period”; and

(viii) the location and number of the Canadian Borrower’s account (or such other account as the Canadian Borrower may specify) to which funds are to be disbursed.

If no election as to the Type of Borrowing is specified, then the requested Borrowing shall be an ABR Borrowing. If no Interest Period is specified with respect to any requested ~~Eurodollar~~Term Benchmark Borrowing or BA Borrowing, then the Canadian Borrower shall be deemed to have selected an Interest Period of one month’s duration. Promptly following receipt of a Borrowing Request in accordance with this Section 2.03, the Administrative Agent shall advise each Lender of the details thereof and of the amount of such Lender’s Loan to be made as part of the requested Borrowing.

(b) Swingline Borrowings. The Canadian Borrower shall request a Swingline Loan by written notice (or telephone notice promptly confirmed in writing) substantially in the form of Exhibit C hereto (a “Swingline Borrowing Request”) to the Swingline Lender and the Administrative Agent not later than 2:30 P.M. (New York time) on the Business Day of the requested Swingline Loan. Each such notice shall be irrevocable and shall specify (i) that a Swingline Loan is requested, (ii) the date of the requested Swingline Loan (which shall be a Business Day) and (iii) the principal amount and currency of the Swingline Loan requested. Each Swingline Loan in Dollars shall be made as an ABR Loan, each Swingline Loan in Canadian Dollars shall be made as a Canadian Prime Rate Loan and, subject to Section 2.04(b), each Swingline Loan shall have such maturity date as agreed to by the Swingline Lender and the Canadian Borrower upon receipt by the Swingline Lender of the Swingline Borrowing Request from the Canadian Borrower.

(c) L/C Borrowings. Each L/C Borrowing shall be made as specified in Section 2.05(e)(iv) without the necessity of a Borrowing Request.

Section 2.04 Swingline Loans.

(a) The Swingline Lender agrees, on the terms and subject to the conditions set forth herein and in the other Loan Documents and, subject to Section 2.23(a)(vi), to make a portion of the Revolving R-3 Facility Commitments available to the Canadian Borrower from time to time during the Availability Period by making loans in Dollars or Canadian Dollars, as applicable, to the Canadian Borrower (each such loan, a “Swingline Loan” and, collectively, the “Swingline Loans”); provided that (i) the aggregate principal amount of the Swingline Loans outstanding at any one time shall not exceed the Swingline Commitment, (ii) with regard to each Lender individually (other than the Swingline Lender in its capacity as such), such Lender’s outstanding Revolving R-3 Facility Loans plus its Participation Interests in outstanding Swingline Loans plus its Participation Interests in outstanding L/C Obligations shall not at any time exceed such Lender’s Revolving R-3 Commitment Percentage of the Revolving R-3 Committed Amount, (iii) with regard to the Revolving R-3 Facility Lenders collectively, the sum of the aggregate principal amount of Swingline Loans outstanding plus the aggregate amount of Revolving R-3 Facility Loans

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outstanding plus the aggregate amount of L/C Obligations outstanding shall not exceed the Revolving R-3 Committed Amount and (iv) the Swingline Commitment shall not exceed the aggregate of the Revolving R-3 Facility Commitments then in effect. Swingline Loans denominated in Dollars shall be made and maintained as ABR Loans, and Swingline Loans denominated in Canadian Dollars shall be made and maintained as Canadian Prime Rate Loans. Swingline Loans may be repaid and reborrowed in accordance with the provisions hereof prior to the Swingline Termination Date. Swingline Loans may be made notwithstanding the fact that such Swingline Loans, when aggregated with the Swingline Lender’s other Revolving R-3 Facility Credit Exposure, exceeds its Revolving R-3 Facility Commitment. The proceeds of a Swingline Borrowing may not be used, in whole or in part, to refund any prior Swingline Borrowing.

(b) The principal amount of all Swingline Loans shall be due and payable on the earliest of (i) the maturity date agreed to by the Swingline Lender and the Canadian Borrower with respect to such Swingline Loan (which maturity date shall not be more than seven Business Days from the date of advance thereof), (ii) at the request of the Swingline Lender, the last day of the current calendar quarter, (iii) the Swingline Termination Date, (iv) the occurrence of any proceeding with respect to the Canadian Borrower under any Debtor Relief Law or (v) the acceleration of any Loan or the termination of the Revolving R-3 Facility Commitments pursuant to Section 7.01.

(c) With respect to any Swingline Loans that have not been voluntarily prepaid by the Canadian Borrower or paid by the Canadian Borrower when due under Section 2.04(b) above, the Swingline Lender (by request to the Administrative Agent) or the Administrative Agent at any time may, and shall at any time Swingline Loans in an amount of $1,000,000 shall have been outstanding for more than seven days, on one Business Day’s notice, require each Revolving R-3 Facility Lender, including the Swingline Lender, and each such Lender hereby agrees, subject to the provisions of this Section 2.04, to make a Revolving R-3 Facility Loan (which shall be initially funded as a ABR Loan) in an amount equal to such Lender’s Revolving R-3 Commitment Percentage of the amount of the Swingline Loans (the “Refunded Swingline Loans”) outstanding on the date notice is given.

(d) In the case of Revolving R-3 Facility Loans made by Lenders other than the Swingline Lender under Section 2.04(c), each such Revolving R-3 Facility Lender shall make the amount of its Revolving R-3 Facility Loan available to the Administrative Agent, in same day funds, at the Administrative Agent’s Office, not later than 1:00 P.M. on the Business Day next succeeding the date such notice is given. The proceeds of such Revolving R-3 Facility Loans shall be immediately delivered to the Swingline Lender (and not to the Canadian Borrower) and applied to repay the Refunded Swingline Loans. On the day such Revolving R-3 Facility Loans are made, the Swingline Lender’s Revolving R-3 Commitment Percentage of the Refunded Swingline Loans shall be deemed to be paid with the proceeds of a Revolving R-3 Facility Loan made by the Swingline Lender and such portion of the Swingline Loans deemed to be so paid shall no longer be outstanding as Swingline Loans and shall instead be outstanding as Revolving R-3 Facility Loans. The Canadian Borrower authorizes the Administrative Agent and the Swingline Lender to charge the Canadian Borrower’s account with the Administrative Agent (up to the amount available in such account) in order to pay immediately to the Swingline Lender the amount of such Refunded Swingline Loans to the extent amounts received from the Revolving R-3 Facility Lenders, including amounts deemed to be received from the Swingline Lender, are not sufficient to repay in full such Refunded Swingline Loans. If any portion of any such amount paid (or deemed to be paid) to the Swingline Lender should be recovered by or on behalf of the Canadian Borrower from the Swingline Lender in bankruptcy, by assignment for the benefit of creditors or otherwise, the loss of the amount so recovered shall be ratably shared among all Revolving R-3 Facility Lenders in the manner contemplated by Section 2.19.

(e) A copy of each notice given by the Swingline Lender pursuant to this Section 2.04 shall be promptly delivered by the Swingline Lender to the Administrative Agent and the Canadian Borrower. Upon the making of a Revolving R-3 Facility Loan by a Revolving R-3 Facility Lender pursuant to this Section 2.04, the amount so funded shall no longer be owed in respect of its Participation Interest in the related Refunded Swingline Loans.

(f) If as a result of any proceeding under any Debtor Relief Law, Revolving R-3 Facility Loans are not made pursuant to this Section 2.04 sufficient to repay any amounts owed to the Swingline Lender as a result of a nonpayment of outstanding Swingline Loans, each Revolving R-3 Facility Lender agrees to purchase, and shall be deemed to have purchased, a participation in such outstanding Swingline Loans in an amount equal to its Revolving

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R-3 Commitment Percentage of the unpaid amount together with accrued interest thereon. Upon one Business Day’s notice from the Swingline Lender, each Revolving R-3 Facility Lender shall deliver to the Swingline Lender an amount equal to its respective Participation Interest in such Swingline Loans in same day funds at the office of the Swingline Lender specified or referred to in Schedule 9.01. In order to evidence such Participation Interest each Revolving R-3 Facility Lender agrees to enter into a participation agreement at the request of the Swingline Lender in form and substance reasonably satisfactory to all parties. In the event any Revolving R-3 Facility Lender fails to make available to the Swingline Lender the amount of such Revolving R-3 Facility Lender’s Participation Interest as provided in this Section 2.04(f), the Swingline Lender shall be entitled to recover such amount on demand from such Revolving R-3 Facility Lender together with interest at the customary rate set by the Swingline Lender for correction of errors among banks in New York City for one Business Day and thereafter at the Alternate Base Rate plus the then Applicable Margin for ABR Loans.

(g) Each Revolving R-3 Facility Lender’s obligation to make Revolving R-3 Facility Loans pursuant to Section 2.04(d) and to purchase Participation Interests in outstanding Swingline Loans pursuant to Section 2.04(f) above shall be absolute and unconditional and shall not be affected by any circumstance, including (without limitation) (i) any set-off, counterclaim, recoupment, defense or other right which such Revolving R-3 Facility Lender or any other Person may have against the Swingline Lender, the Canadian Borrower or any other Loan Party, (ii) the occurrence or continuance of a Default or an Event of Default or the termination or reduction in the amount of the Revolving R-3 Facility Commitments after any such Swingline Loans were made, (iii) any adverse change in the condition (financial or otherwise) of the Canadian Borrower or any other Person, (iv) any breach of this Agreement or any other Loan Document by the Canadian Borrower or any other Lender, (v) whether any condition specified in Article IV is then satisfied or (vi) any other circumstance, happening or event whatsoever, whether or not similar to any of the forgoing. If such Lender does not pay such amount forthwith upon the Swingline Lender’s demand therefor, and until such time as such Lender makes the required payment, the Swingline Lender shall be deemed to continue to have outstanding Swingline Loans in the amount of such unpaid Participation Interest for all purposes of the Loan Documents other than those provisions requiring the other Lenders to purchase a participation therein. Further, such Lender shall be deemed to have assigned any and all payments made of principal and interest on its Loans, and any other amounts due to it hereunder to the Swingline Lender to fund Swingline Loans in the amount of the Participation Interest in Swingline Loans that such Lender failed to purchase pursuant to this Section 2.04(g) until such amount has been purchased (as a result of such assignment or otherwise).

Section 2.05 Letters of Credit.

(a) Issuance of Letters of Credit. Subject to the terms and conditions set forth herein, (i) each L/C Issuer agrees, in reliance upon the agreements of the other Revolving R-3 Facility Lenders set forth in this Section 2.05, (A) from time to time on any Business Day during the period from the Amendment No. 2 Effective Date until the Letter of Credit Expiration Date, to issue Dollar Letters of Credit and Canadian Letters of Credit for the account, and upon the request, of the Canadian Borrower or one or more of its Restricted Subsidiaries and in support of (x) trade obligations of the Canadian Borrower and/or its Restricted Subsidiaries, which shall be payable at sight in Dollars or Canadian Dollars, as applicable (each such letter of credit, a “Trade Letter of Credit” and collectively, the “Trade Letters of Credit”) and (y) such other obligations of the Canadian Borrower incurred for its general corporate purposes (each such letter of credit, a “Standby Letter of Credit” and collectively, the “Standby Letters of Credit”), and to amend or extend Letters of Credit previously issued by it, in accordance with subsection (c) below, and (B) to honor drawings under its Letters of Credit, and (ii) each Revolving R-3 Facility Lender severally agrees to participate in Letters of Credit issued for the account of the Canadian Borrower or its Restricted Subsidiaries and any drawing thereunder in accordance with the provisions of subsection (e) below; provided that, immediately after each Letter of Credit is issued, (i) the aggregate amount of the L/C Obligations shall not exceed the L/C Sublimit, (ii) the Revolving R-3 Facility Credit Exposure shall not exceed the Revolving R-3 Committed Amount and (iii) with respect to each individual Revolving R-3 Facility Lender, the aggregate outstanding principal amount of such Revolving R-3 Facility Lender’s Revolving R-3 Facility Loans plus its Participation Interests in outstanding L/C Obligations plus its (other than the Swingline Lender’s) Participation Interests in outstanding Swingline Loans shall not exceed such Revolving R-3 Facility Lender’s Revolving R-3 Facility Percentage of the Revolving R-3 Facility Commitments. Each request by the Canadian Borrower or a Restricted Subsidiary for the issuance or amendment of a Letter of Credit shall be deemed to be a representation by the Canadian Borrower and such Restricted Subsidiary that the issuance or amendment of such Letter of Credit complies with the conditions set forth in clauses (i) and (ii) of the proviso to the preceding sentence. Within the foregoing limits, and subject to the terms and conditions hereof,

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the Canadian Borrower’s ability to obtain Letters of Credit shall be fully revolving, and accordingly the Canadian Borrower may, during the period specified in clause (i)(A) above, obtain Letters of Credit to replace Letters of Credit that have expired or that have been drawn upon and reimbursed.

(b) Certain Limitations on Issuances of Letters of Credit.

(i) No L/C Issuer shall issue any Letter of Credit, if (A) subject to Section 2.05(c) with respect to Auto-Extension Letters of Credit, the expiry date of such requested Letter of Credit would occur more than twelve months (or 24 months for Letters of Credit having an aggregate stated or face amount not exceeding $25,000,000, or the Canadian Dollar Equivalent thereof, at any time outstanding) after the date of issuance or last extension, unless the Required Revolving Lenders have approved such expiry date, (B) the expiry date of such requested Letter of Credit would occur after the Letter of Credit Expiration Date, unless the Letter of Credit is cash collateralized after the Letter of Credit Expiration Date on terms reasonably acceptable to L/C Issuer or (C) such Letter of Credit is to be used for any purpose other than for its general corporate purposes unless the Required Revolving Lenders have consented thereto.

(ii) No L/C Issuer shall be under any obligation to issue any Letter of Credit if: (A) such issuance would conflict with, or cause the L/C Issuer to exceed any limits imposed by, any applicable Requirements of Law; (B) shall violate one or more policies of such L/C Issuer generally applied to all borrowers; (C) except as otherwise agreed by the Administrative Agent and the applicable L/C Issuer, such Letter of Credit is in an initial face amount the Dollar Equivalent of which is less than $100,000, in the case of a Trade Letter of Credit, or $25,000, in the case of a Standby Letter of Credit; or (D) such Letter of Credit is to be denominated in a currency other than Dollars or Canadian Dollars.

(iii) No L/C Issuer shall amend any Letter of Credit if the L/C Issuer would not be permitted at such time to issue such Letter of Credit in its amended form under the terms hereof.

(iv) No L/C Issuer shall be under any obligation to amend any Letter of Credit if (A) the L/C Issuer would have no obligation at such time to issue such Letter of Credit in its amended form under the terms hereof, or (B) the beneficiary of such Letter of Credit does not accept the proposed amendment to such Letter of Credit.

(i) Each Letter of Credit shall be issued or amended, as the case may be, upon the request of the Canadian Borrower delivered to the applicable L/C Issuer (with a copy to the Administrative Agent) substantially in the form of Exhibit B-2 hereto (a “Letter of Credit Request”), appropriately completed and signed by a Responsible Officer of the Canadian Borrower. Such Letter of Credit Request must be received by the L/C Issuer and the Administrative Agent not later than 11:00 A.M. at least two Business Days (or such later date and time as the Administrative Agent and the L/C Issuer may agree in a particular instance in their sole discretion) prior to the proposed issuance date or date of amendment, as the case may be. If requested by the applicable L/C Issuer, the Canadian Borrower shall also submit a letter of credit application on such L/C Issuer’s standard form in connection with any request for the issuance or amendment of a Letter of Credit. Additionally, the Canadian Borrower shall furnish to the L/C Issuer and the Administrative Agent such other customary documents and information pertaining to such requested Letter of Credit issuance or amendment, including any L/C Documents, as the L/C Issuer or the Administrative Agent may reasonably require.

(ii) Promptly after receipt of any Letter of Credit Request, the L/C Issuer will confirm with the Administrative Agent (by telephone or in writing) that the Administrative Agent has received a copy of such Letter of Credit Request from the Canadian Borrower and, if not, the L/C Issuer will provide the Administrative Agent with a copy thereof. Unless the L/C Issuer has received written notice from any Revolving R-3 Facility Lender, the Administrative Agent or any Loan Party, at least one Business Day prior to the requested date of issuance or amendment of the applicable Letter of Credit, that one or more applicable conditions contained in Section 4.01 shall not then be satisfied, then, subject to the terms and

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conditions thereof, the L/C Issuer shall, on the requested date, issue a Letter of Credit for the account of the Canadian Borrower (or the applicable subsidiary) or enter into the applicable amendment, as the case may be, in each case in accordance with the L/C Issuer’s usual and customary business practices.

(iii) If the Canadian Borrower so requests in any applicable Letter of Credit Request, the L/C Issuer may, in its sole and absolute discretion, agree to issue a Letter of Credit that has automatic extension provisions (each, an “Auto-Extension Letter of Credit”); provided that any such Auto-Extension Letter of Credit must permit the L/C Issuer to prevent any such extension at least once in each twelve-month period (commencing with the date of issuance of such Letter of Credit) by giving prior notice to the beneficiary thereof not later than a date (the “Non-Extension Notice Date”) in each such twelve-month period to be agreed upon at the time such Letter of Credit is issued. Unless otherwise directed by the L/C Issuer, the Canadian Borrower shall not be required to make a specific request to the L/C Issuer for any such extension. Once an Auto-Extension Letter of Credit has been issued, the Revolving R-3 Facility Lenders shall be deemed to have authorized (but may not require) the L/C Issuer to permit the extension of such Letter of Credit at any time to a date not later than the Letter of Credit Expiration Date; provided, however, that the L/C Issuer shall not permit any such extension if (A) the L/C Issuer has determined that it would not be permitted, or would have no obligation, at such time to issue such Letter of Credit in its revised form (as extended) under the terms hereof (by reason of the provisions of the provisions of subsection (b)(i) or (ii) above or otherwise) or (B) it has received notice (which may be by telephone or in writing) on or before the day that is five Business Days before the Non-Extension Notice Date (x) from the Administrative Agent that the Required Revolving Lenders have elected not to permit such extension or (y) from the Administrative Agent, any Revolving R-3 Facility Lender or any Loan Party that one or more of the applicable conditions specified in Section 4.01 is not then satisfied, and in each such case directing the L/C Issuer not to permit such extension.

(iv) If any Letter of Credit contains provisions providing for automatic reinstatement of the stated amount after any drawing thereunder, (A) unless otherwise directed by the L/C Issuer to permit such reinstatement, and (B) the Administrative Agent and the Revolving R-3 Facility Lenders hereby authorize and direct the L/C Issuer to permit such automatic reinstatement, whether or not a Default then exists, unless the L/C Issuer has received a notice (which may be by telephone or in writing) on or before the date that is two Business Days before the reinstatement date from the Administrative Agent, the Required Revolving Lenders or any Loan Party that one or more of the applicable conditions specified in Section 4.01 is not then satisfied and directing the L/C Issuer to cease permitting such automatic reinstatement of such Letter of Credit.

(v) Promptly after its delivery of any Letter of Credit or any amendment to a Letter of Credit to an advising bank with respect thereto or to the beneficiary thereof, the L/C Issuer will also deliver to the Canadian Borrower and the Administrative Agent a true and complete copy of such Letter of Credit or amendment.

(d) Purchase and Sale of Letter of Credit Participations. Immediately upon the issuance by a L/C Issuer of a Letter of Credit, such L/C Issuer shall be deemed, without further action by any party hereto, to have sold to each Revolving R-3 Facility Lender, and each Revolving R-3 Facility Lender shall be deemed, without further action by any party hereto, to have purchased from such L/C Issuer, without recourse or warranty, an undivided participation interest in such Letter of Credit and the related L/C Obligations in the proportion its Revolving R-3 Commitment Percentage bears to the Revolving R-3 Committed Amount (although any fronting fee payable under Section 2.13 shall be payable directly to the Administrative Agent for the account of the applicable L/C Issuer, and the Lenders (other than such L/C Issuer) shall have no right to receive any portion of any such fronting fee) and any security therefor or guaranty pertaining thereto. Upon any change in the Revolving R-3 Facility Commitments pursuant to Section 9.04 or as otherwise adjusted from time to time in accordance with this Agreement, there shall be an automatic adjustment to the Participation Interests in all outstanding Letters of Credit and all L/C Obligations to reflect the adjusted Revolving R-3 Facility Commitments of the assigning and assignee Lenders or of all Lenders having Revolving R-3 Facility Commitments, as the case may be.

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(e) Drawings and Reimbursements; Funding of Participations.

(i) Upon receipt from the beneficiary of any Letter of Credit of any notice of a drawing under such Letter of Credit, the applicable L/C Issuer shall notify the Canadian Borrower and the Administrative Agent thereof and shall determine in accordance with the terms of such Letter of Credit whether such drawing should be honored. If the L/C Issuer determines that any such drawing shall be honored, such L/C Issuer shall make available to such beneficiary in accordance with the terms of such Letter of Credit the amount of the drawing and shall notify the Canadian Borrower and the Administrative Agent as to the amount to be paid as a result of such drawing and the payment date (each such date, an “Honor Date”).

(ii) The Canadian Borrower shall be irrevocably and unconditionally obligated forthwith to reimburse each L/C Issuer through the Administrative Agent for any amounts paid by such L/C Issuer upon any drawing under any Letter of Credit, together with any and all reasonable charges and expenses which the L/C Issuer may pay or incur relative to such drawing calculated as of the date such L/C Issuer paid such amounts or paid or incurred such charges or expenses. Such reimbursement payment shall be due and payable (i) at or before 1:00 P.M., New York City time, on the Business Day following the Honor Date if the L/C Issuer notifies the Canadian Borrower of such drawing at or before 12:00 P.M., New York City time, on the Honor Date or (ii) at or before 1:00 P.M., New York City, time on the second succeeding Business Day after the Honor Date if such notice if given after 12:00 P.M., New York City time, on the Honor Date; provided that no payment otherwise required by this sentence to be made by the Canadian Borrower at or before 1:00 P.M., New York City time, on any day shall be overdue hereunder if arrangements for such payment by virtue of a Borrowing of Revolving R-3 Facility Loans or a Swingline Loan or other arrangements satisfactory to the applicable L/C Issuer, in its reasonable discretion, shall have been made by the Canadian Borrower at or before 1:00 P.M., New York City time, on such day and such payment is actually made at or before 3:00 P.M., New York City time, on such day. Each reimbursement and other payment to be made by the Canadian Borrower pursuant to this clause (ii) shall be made to the L/C Issuer in Federal or other funds immediately available to it at its address referred to in Schedule 9.01.

(iii) Subject to the satisfaction of all applicable conditions set forth in Article IV, the Canadian Borrower may, at its option, utilize the Swingline Commitment or the Revolving R-3 Facility Commitments, or make other arrangements for payment satisfactory to the L/C Issuer, for the reimbursement of all L/C Disbursements as required by clause (ii) above.

(iv) With respect to any L/C Disbursement that has not been reimbursed by the Canadian Borrower when due under clause (ii) above (an “Unreimbursed Amount”), the Administrative Agent shall promptly notify each Revolving R-3 Facility Lender of the Honor Date, the amount of the Unreimbursed Amount and the amount of such Revolving R-3 Facility Lender’s pro-rata share thereof (determined by the proportion its Revolving R-3 Commitment Percentage bears to the aggregate Revolving R-3 Committed Amount). In such event, the Canadian Borrower shall be deemed to have requested a Borrowing (a “L/C Borrowing”) of ABR Revolving Loans to be disbursed on the date any reimbursement is due under clause (ii) above in an aggregate amount equal to the Unreimbursed Amount, without regard to the minimum and multiples specified in Section 2.02(c), but subject to the amount of the unutilized portion of the Revolving R-3 Facility Commitments and the conditions set forth in Section 4.01 (other than the delivery of a Borrowing Request), and each such Revolving R-3 Facility Lender hereby agrees to make a Revolving R-3 Facility Loan (which shall be initially funded as a Dollar denominated ABR Revolving Loan) in an amount equal to such Lender’s Revolving R-3 Commitment Percentage of the Unreimbursed Amount outstanding on the date notice is given. Any such notice given by a L/C Issuer or the Administrative Agent given pursuant to this clause (iv) may be given by telephone if immediately confirmed in writing; provided that the lack of such an immediate confirmation shall not affect the conclusiveness or binding effect of such notice.

(v) Each Revolving R-3 Facility Lender (including any Revolving R-3 Facility Lender acting as L/C Issuer in respect of any Unreimbursed Amount) shall, upon any notice from the Administrative Agent pursuant to clause (iv) above, make the amount of its Revolving R-3 Facility Loan available to the Administrative Agent, in Dollars in Federal or other immediately available funds same day funds, at the

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Administrative Agent’s Office, not later than 1:00 P.M., New York City time, on the Business Day specified in such notice, whereupon, subject to clause (vi) below, each Revolving R-3 Facility Lender that so makes funds available shall be deemed to have made a Dollar denominated ABR Revolving Loan to the Canadian Borrower in such amount. The Administrative Agent shall remit the funds so received to the applicable L/C Issuer in satisfaction of the Unreimbursed Amount to the extent of such funds.

(vi) With respect to any Unreimbursed Amount that is not fully refinanced by a L/C Borrowing pursuant to clauses (iv) and (v) above because the conditions set forth in Section 4.01 cannot be satisfied or for any other reason, the L/C Issuer shall promptly notify the Administrative Agent, and the Administrative Agent shall promptly notify each Revolving R-3 Facility Lender (other than the relevant L/C Issuer), and each such Revolving R-3 Facility Lender shall promptly and unconditionally pay to the Administrative Agent, for the account of such L/C Issuer, such Revolving R-3 Facility Lender’s pro-rata share of such Unreimbursed Amount (determined by the proportion its Revolving R-3 Commitment Percentage bears to the aggregate Revolving R-3 Committed Amount) in Dollars in Federal or other immediately available funds. Such payment from the Revolving R-3 Facility Lenders shall be due (x) at or before 1:00 P.M. on the date the Administrative Agent so notifies a Revolving R-3 Facility Lender, if such notice is given at or before 10:00 A.M. on such date or (y) at or before 10:00 A.M. on the next succeeding Business Day, together with interest on such amount for each day from and including the date of such drawing to but excluding the day such payment is due from such Revolving R-3 Facility Lender at the Federal Funds Effective Rate for such day (which funds the Administrative Agent shall promptly remit to the applicable L/C Issuer). Each payment by a Revolving R-3 Facility Lender to the Administrative Agent for the account of a L/C Issuer in respect of an Unreimbursed Amount shall constitute a payment in respect of its Participation Interest in related Letter of Credit purchased pursuant to subsection (d) above. The failure of any Revolving R-3 Facility Lender to make available to the Administrative Agent for the account of a L/C Issuer its pro-rata share of any Unreimbursed Amount shall not relieve any other Revolving R-3 Facility Lender of its obligation hereunder to make available to the Administrative Agent for the account of such L/C Issuer its pro-rata share of any payment made under any Letter of Credit on the date required, as specified above, but no such Lender shall be responsible for the failure of any other Lender to make available to the Administrative Agent for the account of the L/C Issuer such other Lender’s pro-rata share of any such payment. Upon payment in full of all amounts payable by a Lender under this clause (vi), such Lender shall be subrogated to the rights of the L/C Issuer against the Canadian Borrower to the extent of such Lender’s pro-rata share of the related L/C Obligation so paid (including interest accrued thereon).

(vii) Each Revolving R-3 Facility Lender’s obligation to make Revolving R-3 Facility Loans pursuant to clause (iv) above and to make payments in respect of its Participation Interests in Unreimbursed Amounts pursuant to clause (vi) above shall be absolute and unconditional and shall not be affected by any circumstance, including: (A) any set-off, counterclaim, recoupment, defense or other right which such Lender may have against the L/C Issuer, the Canadian Borrower or any other Person for any reason whatsoever; (B) the occurrence or continuance of a Default or Event of Default; or (C) any other occurrence, event or condition, whether or not similar to any of the foregoing; provided, however, that each Revolving R-3 Facility Lender’s obligation to make Revolving R-3 Facility Loans as a part of a L/C Borrowing pursuant to clause (iv) above is subject to the conditions set forth in Section 4.01 (other than delivery by the Canadian Borrower of a Borrowing Request). No such making by a Revolving R-3 Facility Lender of a Revolving R-3 Facility Loan or a payment by a Revolving R-3 Facility Lender of an amount in respect of its Participation Interest in Unreimbursed Amounts shall relieve or otherwise impair the obligation of the Canadian Borrower to reimburse the L/C Issuer for the amount of any payment made by the L/C Issuer under any Letter of Credit, together with interest as provided herein.

(viii) If any Revolving R-3 Facility Lender fails to make available to the Administrative Agent for the account of a L/C Issuer any amount required to be paid by such Revolving R-3 Facility Lender pursuant to the foregoing provisions of this subsection (e) by the time specified therefor, the applicable L/C Issuer shall be entitled to recover from such Revolving R-3 Facility Lender (acting through the Administrative Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to the applicable L/C Issuer at a rate per annum equal to the Federal Funds Effective Rate for such day. Any payment made by any Lender after 3:00 P.M. on any Business Day shall be deemed for purposes of the preceding sentence to have

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been made on the next succeeding Business Day. A certificate of the applicable L/C Issuer submitted to any Revolving R-3 Facility Lender (through the Administrative Agent) with respect to any amounts owing under this clause (viii) shall be conclusive absent manifest error.

(f) Repayment of Funded Participations in Respect of Drawn Letters of Credit.

(i) Whenever the Administrative Agent receives a payment of a L/C Obligation as to which the Administrative Agent has received for the account of a L/C Issuer any payments from the Revolving R-3 Facility Lenders pursuant to subsection (e) above (whether directly from the Canadian Borrower or otherwise, including proceeds of cash collateral applied thereto by the Administrative Agent), the Administrative Agent shall promptly pay to each Revolving R-3 Facility Lender which has paid its pro-rata share thereof an amount equal to such Lender’s pro-rata share of the amount thereof (appropriately adjusted, in the case of interest payments, to reflect the period of time during which the payments from the Revolving R-3 Facility Lenders were received) in the same funds as those received by the Administrative Agent.

(ii) If any payment received by the Administrative Agent for the account of a L/C Issuer pursuant to clause (i) above is required to be returned under any of the circumstances (including pursuant to any settlement entered into by the L/C Issuer in its discretion), each Revolving R-3 Facility Lender shall pay to the Administrative Agent for the account of such L/C Issuer its pro-rata share thereof (determined by the proportion its Revolving R-3 Commitment Percentage bears to the aggregate Revolving R-3 Committed Amount) on demand of the Administrative Agent, plus interest thereon from the date of such demand to the date such amount is returned by such Revolving R-3 Facility Lender, at a rate per annum equal to the Federal Funds Effective Rate for such day.

(g) Obligations Absolute. The obligations of the Canadian Borrower under Section 2.05(e) above shall be absolute, unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement, under all circumstances whatsoever, including, without limitation, the following circumstances:

(i) any lack of validity or enforceability of such Letter of Credit, this Agreement or any other Loan Document;

(ii) the use which may be made of the Letter of Credit by, or any acts or omission of, a beneficiary of a Letter of Credit (or any Person for whom the beneficiary may be acting);

(iii) the existence of any claim, counterclaim, set-off, defense or other rights that the Canadian Borrower or any Subsidiary may have at any time against a beneficiary or any transferee of such Letter of Credit (or any Person for whom the beneficiary or transferee may be acting), any L/C Issuer or any other Person, whether in connection with this Agreement or such Letter of Credit or any document related hereto or thereto or any unrelated transaction;

(iv) any draft, demand, certificate, statement or any other document presented under a Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect whatsoever, or any loss or delay in the transmission or otherwise of any document required in order to make a drawing under such Letter of Credit;

(v) any payment by the L/C Issuer under a Letter of Credit against presentation of a draft or certificate that does not at least substantially comply with the terms of such Letter of Credit;

(vi) any payment made by the L/C Issuer under such Letter of Credit to any Person purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit of creditors, liquidator, receiver or other representative of or successor to any beneficiary or any transferee of such Letter of Credit, including any arising in connection with any proceeding under any Debtor Relief Law; or

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(vii) any other act or omission to act or delay of any kind by any L/C Issuer or any other Person or any other event or circumstance whatsoever that might, but for the provisions of this subsection (vii), constitute a defense to, or a legal or equitable discharge of, each of the Borrowers’ or any Subsidiary’s obligations hereunder.

(viii) The Canadian Borrower shall promptly examine a copy of each Letter of Credit and each amendment thereto that is delivered to it and, in the event of any claim of non-compliance with the Canadian Borrower’s instructions or other irregularity, the Canadian Borrower will promptly notify the L/C Issuer. The Canadian Borrower shall be conclusively deemed to have waived any such claim against the L/C Issuer and its correspondents unless such notice is given as aforesaid.

(h) Role of L/C Issuers; Reliance. Each Revolving R-3 Facility Lender and the Canadian Borrower agree that, in determining whether to pay under any Letter of Credit, the relevant L/C Issuer shall not have any responsibility to obtain any document (other than any sight draft, certificates and documents expressly required by the Letter of Credit) or to ascertain or inquire as to the validity or accuracy of any such document or the authority of the Person executing or delivering any such document. None of the L/C Issuer, any Agent-Related Person nor any of the respective correspondents, participants or assignees of the L/C Issuer shall be liable to any Lender for: (i) any action taken or omitted in connection herewith at the request or with the approval of the Lenders or the Required Lenders, as applicable; (ii) any action taken or omitted in the absence of gross negligence or willful misconduct; or (iii) the due execution, effectiveness, validity or enforceability of any document or instrument related to any Letter of Credit or Letter of Credit Request. The Canadian Borrower hereby assumes all risks of the acts or omissions of any beneficiary or transferee with respect to its use of any Letter of Credit; provided, however, that this assumption is not intended to, and shall not, preclude the Canadian Borrower’s pursuing such rights and remedies as it may have against the beneficiary or transferee at law or under any other agreement. None of the L/C Issuer, any Agent-Related Person, nor any of the respective correspondents, participants or assignees of the L/C Issuer, shall be liable or responsible for any of the matters described in clauses (i) through (vi) of subsection (g) of this Section 2.05; provided, however, that anything in such clauses to the contrary notwithstanding, the Canadian Borrower may have a claim against the L/C Issuer, and the L/C Issuer may be liable to the Canadian Borrower, to the extent, but only to the extent, of any direct, as opposed to consequential or exemplary, damages suffered by the Canadian Borrower which were caused by the L/C Issuer’s bad faith, willful misconduct or gross negligence or the L/C Issuer’s willful failure to pay under any Letter of Credit after the presentation to it by the beneficiary of a sight draft and certificate(s) complying with the terms and conditions of a Letter of Credit. In furtherance and not in limitation of the foregoing, the L/C Issuer may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary, and the L/C Issuer shall not be responsible for the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason.

(i) Cash Collateral. If the Canadian Borrower is required pursuant to the terms of this Agreement or any other Loan Document to Cash Collateralize any L/C Obligations, the Canadian Borrower shall deposit in an account with the Collateral Agent an amount in cash equal to 103% of the amount of such L/C Obligations as of such date plus any accrued and unpaid interest thereon. Such deposit shall be held by the Collateral Agent as collateral for the payment and performance of the L/C Obligations. The Collateral Agent shall have exclusive dominion and control, including the exclusive right of withdrawal, over such account. The Collateral Agent will, at the request of the Canadian Borrower, invest amounts deposited in such account in Cash Equivalents as directed by the Canadian Borrower; provided, however, that (i) the Collateral Agent shall not be required to make any investment that, in its sole judgment, would require or cause the Collateral Agent to be in, or would result in any, violation of any Law and (ii) if an Event of Default shall have occurred and be continuing, the selection of such Cash Equivalents shall be in the sole discretion of the Collateral Agent. Other than any interest or profits earned on such investments, such deposits shall not bear interest. Interest or profits, if any, on such investments shall accumulate in such account. Moneys in such account shall be applied by the Collateral Agent to reimburse the L/C Issuers immediately for drawings under the applicable Letters of Credit and, if the maturity of the Loans has been accelerated, to satisfy the L/C Obligations. If the Canadian Borrower is required to provide an amount of cash collateral hereunder as a result of an Event of Default, such amount (to the extent not applied as aforesaid) shall be returned to the Canadian Borrower within one Business Day after such Event of Default has been cured or waived. If the Canadian Borrower is required to provide an amount of cash collateral hereunder pursuant to Section 2.12(b), such amount (to the extent

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not applied as aforesaid) shall be returned to the Canadian Borrower upon demand; provided that, after giving effect to such return, the aggregate Revolving R-3 Facility Credit Exposure would not exceed the Revolving R-3 Committed Amount. If the Canadian Borrower is required to deposit an amount of cash collateral hereunder pursuant to Section 2.12(b), interest or profits thereon (to the extent not applied as aforesaid) shall be returned to the Canadian Borrower after the full amount of such deposit has been applied by the Collateral Agent to reimburse the L/C Issuer for drawings under Letters of Credit.

(j) Applicability of ISP and UCP. Unless otherwise expressly agreed by the L/C Issuer and the Canadian Borrower when a Letter of Credit is issued (including any such agreement applicable to an existing Letter of Credit), (i) the rules of the ISP shall apply to each Standby Letter of Credit, and (ii) the rules of the Uniform Customs and Practice for Documentary Credits (the “UCP”), as most recently published by the International Chamber of Commerce at the time of issuance shall apply to each Trade Letter of Credit.

(k) Conflict with L/C Documents. In the event of any conflict between this Agreement and any L/C Document, this Agreement shall govern.

(l) Letters of Credit Issued for Restricted Subsidiaries. Notwithstanding that a Letter of Credit issued or outstanding hereunder is in support of any obligations of, or is for the account of, a Restricted Subsidiary, the Canadian Borrower shall be obligated to reimburse the applicable L/C Issuer hereunder for any and all drawings under such Letter of Credit. The Canadian Borrower hereby acknowledges that the issuance of Letters of Credit for the account of Restricted Subsidiaries inures to the benefit of the Canadian Borrower, and that the Canadian Borrower’s business derives substantial benefits from the businesses of such Subsidiaries.

(m) Resignation of a L/C Issuer; New or Successor L/C Issuer.

(i) Any L/C Issuer may resign as a L/C Issuer upon 60 days’ prior written notice to the Administrative Agent, the applicable Revolving R-3 Facility Lenders and the Canadian Borrower. Subject to the terms of the following sentence, the Canadian Borrower may replace the L/C Issuer for any reason upon written notice to the Administrative Agent and the L/C Issuer and the Canadian Borrower may add L/C Issuer at any time upon notice to the Administrative Agent and with the agreement of such new L/C Issuer. If a L/C Issuer shall resign or be replaced, or if the Canadian Borrower shall decide to add a new L/C Issuer under this Agreement, then the Canadian Borrower may appoint a successor issuer of Letters of Credit or a new L/C Issuer, as the case may be, with the consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed), whereupon such successor issuer shall succeed to the rights, powers and duties of the replaced or resigning L/C Issuer under this Agreement and the other Loan Documents, or such new issuer of Letters of Credit shall be granted the rights, powers and duties of a L/C Issuer hereunder, and the term “L/C Issuer” shall mean such successor or such new issuer of Letters of Credit effective upon such appointment. The acceptance of any appointment as a L/C Issuer hereunder, whether as a successor issuer or new issuer of Letters of Credit in accordance with this Agreement, shall be evidenced by an agreement entered into by such new or successor issuer of Letters of Credit, in a form reasonably satisfactory to the Canadian Borrower and the Administrative Agent, and, from and after the effective date of such agreement, such new or successor issuer of Letters of Credit shall become a “L/C Issuer” hereunder. After the resignation or replacement of a L/C Issuer hereunder, the resigning or replaced L/C Issuer shall remain a party hereto and shall continue to have all the rights and obligations of a L/C Issuer under this Agreement and the other Loan Documents with respect to Letters of Credit issued by it prior to such resignation or replacement, but shall not be required to issue additional Letters of Credit or amend or renew Existing Letters of Credit. In connection with any resignation or replacement pursuant to this clause (a) (but, in case of any such resignation, only to the extent that a successor issuer of Letters of Credit shall have been appointed), either (i) the Canadian Borrower, the resigning or replaced L/C Issuer and the successor issuer of Letters of Credit shall arrange to have any outstanding Letters of Credit issued by the resigning or replaced L/C Issuer replaced with Letters of Credit issued by the successor issuer of Letters of Credit or (ii) the Canadian Borrower shall cause the successor issuer of Letters of Credit, if such successor issuer is reasonably satisfactory to the replaced or resigning L/C Issuer, to issue “back-stop” Letters of Credit naming the resigning or replaced L/C Issuer as beneficiary for each outstanding Letter of Credit issued by the resigning or replaced L/C Issuer, which new Letters of Credit shall have a face amount

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equal to the Letters of Credit being back-stopped, and the sole requirement for drawing on such new Letters of Credit shall be a drawing on the corresponding back-stopped Letters of Credit. After any resigning or replaced L/C Issuer’s resignation or replacement as L/C Issuer, the provisions of this Agreement relating to a L/C Issuer shall inure to its benefit as to any actions taken or omitted to be taken by it (A) while it was a L/C Issuer under this Agreement or (B) at any time with respect to Letters of Credit issued by such L/C Issuer.

(ii) To the extent that there are, at the time of any resignation or replacement as set forth in clause (i) above, any outstanding Letters of Credit, nothing herein shall be deemed to impact or impair any rights and obligations of any of the parties hereto with respect to such outstanding Letters of Credit (including, without limitation, any obligations related to the payment of fees or the reimbursement or funding of amounts drawn), except that the Canadian Borrower, the resigning or replaced L/C Issuer and the successor issuer of Letters of Credit shall have the obligations regarding outstanding Letters of Credit described in clause (i) above.

(n) Reporting. Each L/C Issuer will report in writing to the Administrative Agent (i) on the first Business Day of each week, the aggregate face amount of Letters of Credit issued by it and outstanding as of the last Business Day of the preceding week, (ii) on or prior to each Business Day on which such L/C Issuer expects to issue, amend, renew or extend any Letter of Credit, the date of such issuance or amendment, and the aggregate face amount of Letters of Credit to be issued, amended, renewed or extended by it and outstanding after giving effect to such issuance, amendment, renewal or extension (and such L/C Issuer shall advise the Administrative Agent on such Business Day whether such issuance, amendment, renewal or extension occurred and whether the amount thereof changed), (iii) on each Business Day on which such L/C Issuer makes any L/C Disbursement, the date and amount of such L/C Disbursement and (iv) on any Business Day on which the Canadian Borrower fails to reimburse a L/C Disbursement required to be reimbursed to such L/C Issuer on such day, the date, amount or Dollar Equivalent amount, as applicable, of such failure.

(o) If the maturity date in respect of any tranche of Revolving R-3 Facility Commitments occurs prior to the expiration of any Letter of Credit, then the Canadian Borrower shall Cash Collateralize any such Letter of Credit in accordance with Section 2.05(i). The occurrence of a maturity date with respect to the Revolving R-3 Facility Commitments shall have no effect upon (and shall not diminish) the percentage participations of the Revolving R-3 Facility Lenders in any Letter of Credit issued before such maturity date. Commencing with the maturity date of any tranche of Revolving R-3 Facility Commitments, the L/C Sublimit shall be agreed between the Lenders under the extended tranches and the Canadian Borrower.

Section 2.06 BAs.

(a) To facilitate availment of BA Loans, the Canadian Borrower hereby appoints each Lender as its attorney to sign and endorse on its behalf (in accordance with the Borrowing Request or Interest Election Request relating to a BA Loan pursuant to Section 2.02 or 2.08), in handwriting or by facsimile or mechanical signature as and when deemed necessary by such Lender, blank forms of BAs in the form requested by such Lender. The Canadian Borrower recognizes and agrees that all BAs signed and/or endorsed by a Lender on behalf of the Canadian Borrower shall bind the Canadian Borrower as fully and effectually as if signed in the handwriting of and duly issued by the proper signing officers of the Canadian Borrower. Each Lender is hereby authorized (in accordance with a Borrowing Request or Interest Election Request relating to a BA Loan) to issue such BAs endorsed in blank in such face amounts as may be determined by such Lender; provided that the aggregate amount thereof is equal to the aggregate amount of BAs required to be accepted and purchased by such Lender. No Lender shall be liable for any damage, loss or other claim arising by reason of any loss or improper use of any such instrument except for the gross negligence or willful misconduct of such Lender or its officers, employees, agents or representatives. Each Lender shall maintain a record, which shall be made available to the Canadian Borrower upon its request, with respect to BAs (i) received by it in blank hereunder, (ii) voided by it for any reason, (iii) accepted and purchased by it hereunder, and (iv) canceled at their respective maturities. On request by the Canadian Borrower, a Lender shall cancel all forms of BAs which have been pre-signed or pre-endorsed on behalf of the Canadian Borrower and that are held by such Lender and are not required to be issued in accordance with the Canadian Borrower’s irrevocable Borrowing Request or Interest Election Request. Alternatively, the Canadian

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Borrower agrees that, at the request of the Administrative Agent, the Canadian Borrower shall deliver to the Administrative Agent a “depository note” which complies with the requirements of the Depository Bills and Notes Act (Canada), and consents to the deposit of any such depository note in the book-based debt clearance system maintained by the Canadian Depository for Securities.

(b) Drafts of the Canadian Borrower to be accepted as BAs hereunder shall be signed as set forth in this Section 2.06. Notwithstanding that any Person whose signature appears on any BA may no longer be an authorized signatory for any Lender or the Canadian Borrower at the date of issuance of a BA, such signature shall nevertheless be valid and sufficient for all purposes as if such authority had remained in force at the time of such issuance and any such BA so signed shall be binding on the Canadian Borrower.

(c) Promptly following the receipt of a Borrowing Request or Interest Election Request specifying a Borrowing by way of BA Loan, the Administrative Agent shall so advise the Lenders and shall advise each Lender of the aggregate face amount of the BA to be accepted by it and the applicable BA Contract Period (which shall be identical for all Lenders). In the case of each BA Borrowing, the aggregate face amount of the BA to be accepted by a Lender shall be in a minimum aggregate amount of CND$1,000,000 and shall be a whole multiple of CND$500,000, and such face amount shall be in the Lenders’ pro rata portions of such Borrowing; provided that the Administrative Agent may in its sole discretion increase or reduce any Lender’s portion of such BA Loan to the nearest $500,000.

(d) If the Canadian Borrower specifies in a Borrowing Request pursuant to Section 2.03 or an Interest Election Request pursuant to Section 2.08 that it desires a BA Loan, subject to the terms and conditions herein, the Lenders shall accept and purchase the BAs from the Canadian Borrower at the BA Discount Rate applicable to such BAs accepted by them and provide to the Administrative Agent the Discount Proceeds for the account of the Canadian Borrower. The Acceptance Fee payable by the Canadian Borrower to a Lender under Section 2.13(c) in respect of each BA accepted by such Lender shall be set off against and deducted from the Discount Proceeds payable by such Lender under this Section 2.06(d).

(e) Each Lender may at any time and from time to time hold, sell, rediscount or otherwise dispose of any or all BAs accepted and purchased by it.

(f) If a Lender is not a chartered bank named in Schedule 1 to the Bank Act (Canada) or if a Lender notifies the Administrative Agent in writing that it is otherwise unable to accept BAs, such Lender will, instead of accepting and purchasing BAs, make an advance (a “BA Equivalent Loan”) to the Canadian Borrower in the amount and for the same term as the draft that such Lender would otherwise have been required to accept and purchase hereunder (it being the intention of the parties that each BA Equivalent Loan shall have the same economic consequences for each Lender making such BA Equivalent Loan and the Canadian Borrower as the BA that such BA Equivalent Loan replaces, including payment by the Canadian Borrower to each such Lender making such BA Equivalent Loan of the Acceptance Fee). Each such Lender will provide to the Administrative Agent the Discount Proceeds of such BA Equivalent Loan for the account of the Canadian Borrower.

(g) The Canadian Borrower waives presentment for payment and any other defense to payment of any amounts due to a Lender in respect of a BA accepted and purchased by it pursuant to this Agreement which might exist solely by reason of such BA being held, at the maturity thereof, by such Lender in its own right, and the Canadian Borrower agrees not to claim any days of grace if such Lender, as holder, claims payment from or sues the Canadian Borrower on the BA for payment of the amount payable by the Canadian Borrower thereunder. On the last day of the BA Contract Period of a BA, or such earlier date as may be required or permitted pursuant to the provisions of this Agreement, the Canadian Borrower shall pay the Lender that has accepted and purchased a BA or advanced a BA Equivalent Loan (irrespective of whether such Lender then holds such BA) the full face amount of such BA or BA Equivalent Loan, as the case may be, and, after such payment, the Canadian Borrower shall have no further liability in respect of such BA and such Lender shall be entitled to all benefits of, and be responsible for all payments due to third parties under, such BA.

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(h) Except as provided in Sections 2.06, 2.10, 2.11, 2.12 and 2.22 and as required under Article VII, no BA Loan may be repaid by the Canadian Borrower prior to the expiry date of the BA Contract Period applicable to such BA Loan.

(i) In respect of any BA Loan to be repaid or prepaid by the Canadian Borrower prior to the expiry date of the BA Contract Period applicable to such BA Loan, the Canadian Borrower shall deposit with the Administrative Agent an amount equal to the aggregate face amount of all BA’s comprising such BA Loan, such deposit to be held by the Administrative Agent in a Prepayment Account as continuing security for payment and satisfaction of the Obligations. The Administrative Agent shall apply any cash deposited in the Prepayment Account allocable to amounts to become due in respect of BAs on the last day of their respective BA Contract Periods until all amounts due in respect of such outstanding BAs have been repaid or until all such cash has been exhausted (and any amount remaining in the Prepayment Account after all of the respective BAs for which the applicable deposit was made have matured and been paid will be released to the Canadian Borrower). For purposes of this Agreement, the term “Prepayment Account” shall mean an account established by the Canadian Borrower with the Administrative Agent and over which the Administrative Agent shall have exclusive control, including the exclusive right of withdrawal for application in accordance with this paragraph (i). The Administrative Agent will, at the request of the Canadian Borrower, invest amounts on deposit in the Prepayment Account in short-term, cash equivalent investments selected by the Administrative Agent in consultation with the Canadian Borrower that mature prior to the last day of the applicable BA Contract Periods of the BAs to be prepaid; provided, however, that the Administrative Agent shall have no obligation to invest amounts on deposit in the Prepayment Account if an Event of Default shall have occurred and be continuing. The Canadian Borrower shall indemnify the Administrative Agent for any losses relating to the investments so that the amount available to prepay amounts due in respect of BAs on the last day of the applicable BA Contract Period is not less than the amount that would have been available had no investments been made pursuant thereto. Other than any interest earned on such investments (which shall be for the account of the Canadian Borrower, to the extent not necessary for the prepayment of BAs in accordance with this Section), the Prepayment Account shall not bear interest. Interest or profits, if any, on such investments shall be deposited in the Prepayment Account and reinvested and disbursed as specified above. If the maturity of the Loans and all amounts due hereunder have been accelerated pursuant to Article VII, the Administrative Agent may, in its sole discretion, apply all amounts on deposit in the Prepayment Account of the Canadian Borrower to satisfy any of the Obligations of the Canadian Borrower in respect of Loans and BAs (and the Canadian Borrower hereby grants to the Administrative Agent a security interest in its Prepayment Account to secure such Obligations).

Section 2.07 Funding of Borrowings.

(a) Each Lender shall make each Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds by 12:00 noon, New York City time, to the account of the Administrative Agent most recently designated by it for such purpose by notice to the Lenders; provided that Swingline Loans shall be made as provided in Section 2.04. The Administrative Agent will make the proceeds of funds made available to it pursuant to the preceding sentence available to the applicable Borrower by promptly crediting the amounts so received, in like funds, to an account of the applicable Borrower maintained with the Administrative Agent (i) in New York City, in the case of Loans denominated in Dollars, or (ii) in Toronto, in the case of Loans denominated in Canadian Dollars and designated by the applicable Borrower in the applicable Borrowing Request; provided that ABR Revolving Loans and Swingline Borrowings made to finance the reimbursement of a L/C Disbursement as provided in Section 2.05(e) shall be remitted by the Administrative Agent to the applicable L/C Issuer.

(b) Unless the Administrative Agent shall have received notice from a Lender prior to the proposed date of any Borrowing of Revolving R-3 Facility Loans and/or Term Loans that such Lender will not make available to the Administrative Agent such Lender’s share of such Borrowing, the Administrative Agent may assume that such Lender has made such share available on such date in accordance with paragraph (a) of this Section and may, in reliance upon such assumption, make available to the applicable Borrower a corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Borrowing of Revolving R-3 Facility Loans or Term Loans available to the Administrative Agent, the amount so made available by the Administrative Agent shall be a separate loan to such Borrower which loan the applicable Lender and the applicable Borrower severally agree to pay to the Administrative Agent forthwith on demand (without duplication) with demand to be first made on such Lender if legally possible) with interest thereon, for each day from and including the date such amount is made available to the

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applicable Borrower to but excluding the date of payment to the Administrative Agent, at (i) in the case of such Lender, (x) the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation (in the case of a Borrowing denominated in Dollars) or (y) the rate reasonably determined by the Administrative Agent to be the cost to it of funding such amount (in the case of a Borrowing denominated in Canadian Dollars) or (ii) in the case of the applicable Borrower, the interest rate applicable to ABR Loans (in the case of a Borrowing denominated in Dollars) or the rate reasonably determined by the Administrative Agent to be the cost to it of funding such amount (in the case of a Borrowing denominated in Canadian Dollars). If such Lender pays such amount to the Administrative Agent, then such payment shall discharge such Borrower’s obligation to pay such demand loan and from that time shall constitute such Lender’s Loan included in such Borrowing.

Section 2.08 Interest Elections.

(a) Each Borrowing initially shall be of the Type specified in the applicable Borrowing Request and, in the case of a ~~Eurodollar~~Term Benchmark Borrowing or BA Borrowing, shall have an initial Interest Period as specified in such Borrowing Request. Thereafter, the Canadian Borrower may elect to convert such Borrowing to a different Type, in the case of Borrowings denominated in Dollars, or to continue such Borrowing and, in the case of a ~~Eurodollar~~Term Benchmark Borrowing or BA Borrowing, may elect Interest Periods therefor, all as provided in this Section. Any conversion or continuation hereunder shall be in the same currency as the original obligation. The Canadian Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders holding the Loans comprising such Borrowing, and the Loans comprising each such portion shall be considered a separate Borrowing. This Section 2.08 shall not apply to Swingline Borrowings, which may not be converted or continued.

(b) To make an election pursuant to this Section 2.08, the Canadian Borrower shall notify the Administrative Agent of such election in writing by the time that a Borrowing Request would be required under Section 2.03 if the Canadian Borrower were requesting a Borrowing of the Type and currency resulting from such election to be made on the effective date of such election. Each such Interest Election Request shall be irrevocable and shall be confirmed promptly by hand delivery or telecopy to the Administrative Agent of a written Interest Election Request in a form approved by the Administrative Agent and signed by the Canadian Borrower.

(i) the Borrowing to which such Interest Election Request applies and, if different options are being elected with respect to different portions thereof, the portions thereof to be allocated to each resulting Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) below shall be specified for each resulting Borrowing);

(ii) the effective date of the election made pursuant to such Interest Election Request, which shall be a Business Day;

(iii) whether the resulting Revolving R-3 Facility Borrowing is to be an ABR Borrowing, ~~Eurodollar~~Term Benchmark Borrowing, Canadian Prime Rate Borrowing or BA Borrowing, or whether the resulting Term B-5 Loan Borrowing or Incremental Term Loan Borrowing is to be an ABR Borrowing or a ~~Eurodollar~~Term Benchmark Borrowing; and

(iv) if the resulting Borrowing is a ~~Eurodollar~~Term Benchmark Borrowing or BA Borrowing, the Interest Period to be applicable thereto after giving effect to such election, which shall be a period contemplated by the definition of the term “Interest Period.”

If any such Interest Election Request requests a ~~Eurodollar~~Term Benchmark Borrowing or BA Borrowing but does not specify an Interest Period, then the Canadian Borrower shall be deemed to have selected an Interest Period of one month’s duration.

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(d) Promptly following receipt of an Interest Election Request, the Administrative Agent shall advise each Lender to which such Interest Election Request relates of the details thereof and of such Lender’s portion of each resulting Borrowing.

(e) If the Canadian Borrower fails to deliver a timely Interest Election Request with respect to a ~~Eurodollar~~Term Benchmark Borrowing or BA Borrowing, as applicable, prior to the end of the Interest Period applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be continued as a ~~Eurodollar~~Term Benchmark Borrowing or BA Borrowing, as applicable, with an Interest Period of one month’s duration commencing on the last day of such Interest Period. Notwithstanding any contrary provision hereof, if an Event of Default has occurred and is continuing and the Administrative Agent, at the written request (including a request through electronic means) of the Required Lenders, so notifies the Canadian Borrower, then, so long as an Event of Default is continuing (i) except as provided in clause (iii) below, no outstanding Borrowing may be converted to or continued as a ~~Eurodollar~~Term Benchmark Borrowing or BA Borrowing, as applicable, (ii) unless repaid, each ~~Eurodollar~~Term Benchmark Borrowing shall be continued as a ~~Eurodollar~~Term Benchmark Borrowing with an Interest Period of one month’s duration and (iii) unless repaid, each BA Borrowing shall be converted into an ABR Borrowing denominated in Canadian Dollars at the end of the BA Contract Period applicable thereto.

Section 2.09 Termination and Reduction of Commitments.

(a) Unless previously terminated, the Revolving R-3 Facility Commitments shall terminate on the Revolving R-3 Facility Maturity Date. The Term B-5 Loan Commitment of each Term Loan Lender shall terminate upon the funding of such Loans on the Amendment No. 6 Effective Date.

(b) The Canadian Borrower may at any time terminate, or from time to time reduce, the Revolving R-3 Facility Commitments or the Term Loan Commitments, as the case may be; provided that (i) each such reduction of an amount denominated in Dollars shall be in an amount that is an integral multiple of $1,000,000 and not less than $5,000,000 (or, if less, the remaining amount of the Revolving R-3 Facility Commitments or Term Loan Commitments, as the case may be) and (ii) Canadian Borrower shall not terminate or reduce the Revolving R-3 Facility Commitments if, after giving effect to any concurrent prepayment of the Revolving R-3 Facility Loans in accordance with Section 2.12, the Revolving R-3 Facility Credit Exposure would exceed the total Revolving R-3 Facility Commitments.

(c) The Canadian Borrower shall notify the Administrative Agent of any election to terminate or reduce the Revolving R-3 Facility Commitments and/or Term Loan Commitments under paragraph (b) of this Section at least three Business Days prior to the effective date of such termination or reduction, specifying such election and the effective date thereof. Promptly following receipt of any notice, the Administrative Agent shall advise the applicable Lenders of the contents thereof. Any termination or reduction of Commitments shall be permanent. Each reduction of the Commitments under any Facility shall be made ratably among the Lenders in accordance with their respective Commitments under such Facility, except that notwithstanding the foregoing, (1) the Canadian Borrower may allocate any termination or reduction of Commitments among Classes of Commitments at its direction (including, for the avoidance of doubt, to the Commitments with respect to any Class of Extended Revolving Credit Commitments without any termination or reduction of the Commitments with respect to any Existing Revolving Credit Commitments of the same Specified Existing Revolving Credit Commitment Class) and (2) in connection with the establishment on any date of any Extended Revolving Credit Commitments pursuant to Section 2.24, the Existing Revolving Credit Commitments of any one or more Lenders providing any such Extended Revolving Credit Commitments on such date shall be reduced in an amount equal to the amount of Specified Existing Revolving Credit Commitments so extended on such date (or, if agreed by the Canadian Borrower and the Lenders providing such Extended Revolving Credit Commitments, by any greater amount so long as (a) a proportionate reduction of the Specified Existing Revolving Credit Commitments has been offered to each Lender to whom the applicable Revolving Credit Extension Request has been made (which may be conditioned upon such Lender becoming an Extending Lender), and (b) the Canadian Borrower prepays the Existing Revolving Credit Loans of such Class owed to such Lenders providing such Extended Revolving Credit Commitments to the extent necessary to ensure that, after giving pro forma effect to such repayment or reduction, the Existing Revolving Credit

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Loans of such Class are held by the Lenders of such Class on a pro rata basis in accordance with their Existing Revolving Credit Commitments of such Class after giving pro forma effect to such reduction).

(d) Upon at least one Business Day’s prior written notice to the Administrative Agent and each L/C Issuer (which notice the Administrative Agent shall promptly transmit to each of the applicable Revolving R-3 Facility Lenders), the Canadian Borrower shall have the right, on any day, permanently to terminate or reduce the L/C Sublimit, in whole or in part; provided that, after giving pro forma effect to such termination or reduction, the L/C Obligations shall not exceed the L/C Sublimit.

(e) The Canadian Borrower shall notify the Administrative Agent in writing at least ten (10) days prior to the occurrence of either (i) a Permitted Change of Control or (ii) any event that would constitute a Change of Control but for the operation of the second paragraph of the definition of “Change of Control” (the occurrence of any event described in clauses (i) and/or (ii), a “Permitted Change of Control Termination Event”). On or prior to the date that is five (5) days following the delivery by the Canadian Borrower of such notice of a Permitted Change of Control Termination Event, each Revolving Credit Lender may elect, in its sole discretion, to require the entire aggregate amount of its Revolving Credit Commitments be terminated (any such Revolving Credit Commitments so terminated, and the Revolving Credit Commitments of any Revolving Credit Lender that does not respond prior to the date that is five (5) days following the delivery by the Canadian Borrower of such notice of a Permitted Change of Control Termination Event, the “Permitted Change of Control Terminated Commitments”), and the entire aggregate amount of its Revolving Credit Loans with respect to Permitted Change of Control Terminated Commitments shall be repaid in accordance with Section 2.12, in each case concurrently with (or, at the option of the Canadian Borrower, prior to) the occurrence of the Permitted Change of Control Termination Event (any such election a “Permitted Change of Control Election”); provided that if for any reason the Canadian Borrower does not notify the Administrative Agent at least ten (10) days prior to the occurrence of a Permitted Change of Control Termination Event, then each Revolving Credit Lender may make a Permitted Change of Control Election with respect to such Permitted Change of Control Termination Event on or prior to the date that is five (5) days following the occurrence of such Permitted Change of Control Termination Event. Notwithstanding the foregoing, to the extent any Revolving Credit Lender makes a Permitted Change of Control Election, in lieu of the termination of all or a portion of such Revolving Credit Lender’s Revolving Credit Commitments, the Borrower may require that such Revolving Credit Lender assign, prior to or concurrently with the occurrence of such Permitted Change of Control Termination Event, all or such portion of its Revolving Credit Commitments to one or more assignees designated by the Borrower who consent to take such Revolving Credit Commitments by assignment and purchase any outstanding Revolving Credit Loans outstanding thereunder at par and such Revolving Credit Lender shall be deemed to have consented to such assignment; provided that any such assignment shall be subject to the consent of the Administrative Agent and the L/C Issuer to the extent required under Section 9.04(b)(i)(B) and (C)); provided, further, that it is understood that the Revolving Credit Commitments of any of Revolving Credit Lender that has made a Permitted Change of Control Election that are not so assigned prior to or concurrently with such Permitted Change of Control Termination Event shall be terminated as described in this clause (e).

Section 2.10 Repayment of Loans; Evidence of Debt, etc.

(a) The Canadian Borrower hereby unconditionally promises to pay (i) on the Revolving R-3 Facility Maturity Date in Dollars or Canadian Dollars, as applicable, to the Administrative Agent the then unpaid principal amount of each Revolving R-3 Facility Loan made to the Canadian Borrower, and (ii) in Dollars or Canadian Dollars, as applicable, to the Administrative Agent for the account of each Lender the then unpaid principal amount of each Term Loan of such Lender as provided in Section 2.11. The Canadian Borrower hereby unconditionally promises to pay in Dollars or Canadian Dollars, as applicable, to each Swingline Lender the then unpaid principal amount of each Swingline Loan made to the Canadian Borrower on the earlier of the Revolving R-3 Facility Maturity Date and the tenth Business Day after such Swingline Loan is made; provided that on each date that a Revolving R-3 Facility Borrowing is made by the Canadian Borrower, then the Canadian Borrower shall repay all its Swingline Loans then outstanding.

(b) Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness of the Canadian Borrower to such Lender resulting from each Loan made by such Lender from time

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to time, including the amounts of principal and interest payable and paid to such Lender from time to time under this Agreement.

(c) The Administrative Agent shall maintain accounts in which it shall record (i) the amount and currency of each Loan made hereunder, the Facility and Type thereof and the Interest Period (if any) applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Canadian Borrower to each Lender hereunder and (iii) any amount received by the Administrative Agent hereunder from the Canadian Borrower and each Lender’s share thereof.

(d) The entries made in the accounts maintained pursuant to subsections (b) and (c) of this Section 2.10 shall be prima facie evidence absent demonstrable error of the existence and amounts of the obligations therein recorded; provided, however, that the failure of any Lender or the Administrative Agent to maintain such accounts or any error therein shall not in any manner affect the obligations of the Canadian Borrower to repay the Loans in accordance with the terms of this Agreement.

(e) Any Lender may request that Loans made by it be evidenced by a promissory note. In such event, the Canadian Borrower shall prepare, execute and deliver to such Lender a promissory note payable to such Lender or its registered assigns and substantially in the form of Exhibits E-1 or E-2, as the case may be, for the Term B-5 Loans and Revolving R-3 Facility Loans, respectively. Thereafter, the Loans evidenced by such promissory note (a “Note”) and interest thereon shall at all times (including after assignment pursuant to Section 9.04) be represented by one or more promissory notes in such form payable to the payee named therein or its registered assigns. If requested by the Swingline Lender, the Swingline Loans shall be evidenced by a single Swingline Note, substantially in the form of Exhibit E-3, payable to the Swingline Lender in an amount equal to the aggregate unpaid principal amount of the Swingline Loans.

(f) Each Lender having one or more Notes shall record the date, amount, Class and Type of each Loan made by it and the date and amount of each payment of principal made by the Canadian Borrower with respect thereto, and may, if such Lender so elects in connection with any permitted transfer or enforcement of any Note, endorse on the reverse side or on the schedule, if any, forming a part thereof appropriate notations to evidence the foregoing information with respect to each outstanding Loan evidenced thereby; provided that the failure of any Lender to make any such recordation or endorsement shall not affect the obligations of the Canadian Borrower hereunder or under any such Note. Each Lender is hereby irrevocably authorized by the Canadian Borrower so to endorse each of its Notes and to attach to and make a part of each of its Notes a continuation of any such schedule as and when required.

Section 2.11 Repayment of Loans.

(a) Subject to adjustment pursuant to paragraph (c) of this Section 2.11 and Section 2.12(a), the Canadian Borrower shall repay Term B-5 Loans on (x) the last day of each quarter beginning with the fiscal quarter ending March 31, 2020 in an amount equal to 0.25% of the original aggregate principal amount of Term B-5 Loans outstanding on the Amendment No. 6 Effective Date (as such principal amount may be reduced by, and after giving effect to, any voluntary and mandatory prepayments made in accordance with Section 2.12) and (y) the Term B-5 Loan Maturity Date in an amount equal to the remaining principal amount of the Term B-5 Loans.

(b) To the extent not previously paid, all Term B-5 Loans shall be due and payable on the Term B-5 Loan Maturity Date.

(c) (i) Subject to clause (ii) of this Section 2.11(c) and Section 2.12, (A) each prepayment of Term Loans required by Section 2.12 (other than in connection with a Debt Incurrence Event) shall be allocated to the Classes of Term Loans outstanding, pro rata, based upon the applicable remaining principal amounts due in respect of each such Class of Term Loans (excluding any Class of Term Loans that has agreed to receive a less than pro rata share of any such mandatory prepayment), shall be applied pro rata to Lenders within each Class, based upon the outstanding principal amounts owing to each such Lender under each such Class of Term Loans and shall be applied to reduce such scheduled principal amounts within each such Class in accordance with Section 2.12(d) and (B) each prepayment of Term Loans required by Section 2.12(c) in connection with a Debt Incurrence Event shall be

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allocated to any Class of Term Loans outstanding as directed by the Canadian Borrower (subject to the requirement that the proceeds of any Specified Debt Incurrence Prepayment Event be applied to Refinance the applicable Indebtedness), shall be applied pro rata to Lenders within each such Class, based upon the outstanding principal amounts owing to each such Lender under each such Class of Term Loans and shall be applied to reduce such scheduled principal amounts within each such Class in accordance with Section 2.12(d); provided that, with respect to the allocation of such prepayments under clause (A) above only, between an Existing Term Loan Class and Extended Term Loans of the same Extension Series, the Canadian Borrower may allocate such prepayments as the Canadian Borrower may specify, subject to the limitation that the Canadian Borrower shall not allocate to Extended Term Loans of any Extension Series any such mandatory prepayment under such clause (A) unless such prepayment is accompanied by at least a pro rata prepayment, based upon the applicable remaining principal amounts due in respect thereof, of the Term Loans of the Existing Term Loan Class, if any, from which such Extended Term Loans were converted or exchanged (or such Term Loans of the Existing Term Loan Class have otherwise been repaid in full).

(ii) With respect to each such prepayment required by Section 2.12 (other than any Specified Debt Incurrence Prepayment Event to be applied to Refinance the applicable Indebtedness), (A) the Canadian Borrower will, not later than the applicable date specified in Section 2.12 for offering to make such prepayment, give the Administrative Agent, written notice requesting that the Administrative Agent provide notice of such prepayment to each Lender and the Administrative Agent will promptly provide such notice to each Lender, (B) each Lender of Term Loans will have the right to refuse any such prepayment by giving written notice of such refusal to the Administrative Agent and the Canadian Borrower within three Business Days after such Lender’s receipt of notice from the Administrative Agent of such prepayment, and to the extent any such prepayment is so refused, such amounts may be retained by the Canadian Borrower and (C) the Canadian Borrower will make all such prepayments not so refused upon the tenth Business Day after the Lender received first notice of repayment from the Administrative Agent.

(d) (i) With respect to each prepayment of Term Loans elected by the Canadian Borrower pursuant to Section 2.12(a) or pursuant to a Debt Incurrence Event, such prepayments shall be applied to reduce principal amounts in such order as the Canadian Borrower may specify (or, if not specified, in direct order of maturity) and the Canadian Borrower may designate the Types of Loans that are to be prepaid and the specific Borrowing(s) pursuant to which made; provided that the Canadian Borrower pays any amounts, if any, required to be paid pursuant to Section 2.17 with respect to prepayments of ~~Eurodollar~~Term Benchmark Loans made on any date other than the last day of the applicable Interest Period. In the absence of a designation by the Canadian Borrower as described in the preceding sentence, the Administrative Agent, shall, subject to the above, make such designation in a manner that minimizes the amount of payments required to be made by the Canadian Borrower pursuant to Section 2.17.

(ii) With respect to each prepayment of Term Loans required pursuant to Section 2.12(c); other than in respect of a Debt Incurrence Event, such prepayments shall be applied to reduce principal amounts in direct order of maturity and on a pro rata basis to the then outstanding Term Loans (other than any Class of Term Loans that has agreed to receive a less than pro rata share of any such mandatory prepayment) being prepaid irrespective of whether such outstanding Term Loans are ABR Loans or ~~Eurodollar~~Term Benchmark Loans; provided that, if no Lender exercises the right to waive a given mandatory prepayment of the Term Loans pursuant to Section 2.11(c)(ii), then, with respect to such mandatory prepayment, the amount of such mandatory prepayment shall be applied first to Term Loans that are ABR Loans to the full extent thereof before application to Term Loans that are ~~Eurodollar~~Term Benchmark Loans in a manner that minimizes the amount of any payments required to be made by the Canadian Borrower pursuant to Section 2.17.

Section 2.12 Prepayments, etc.

(a) The Canadian Borrower shall have the right at any time and from time to time to prepay any Borrowing in whole or in part, without premium or penalty (but subject to Section 2.17), in an aggregate principal amount that is an integral multiple of the Borrowing Multiple and not less than the Borrowing Minimum or, if less, the amount outstanding, subject to prior notice in accordance with Section 2.09(c); provided that such optional prepayments of the Term Loans shall be applied as directed by the Canadian Borrower to scheduled amortization

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payments pursuant to Section 2.11(a) above. Notwithstanding anything in this Section 2.12(a) to the contrary, in the event that, following the Amendment No. 6 Effective Date and prior to the six-month anniversary of the Amendment No. 6 Effective Date, (x) the Canadian Borrower makes any prepayment of Term B-5 Loans in connection with any Repricing Transaction, or (y) effects any amendment of this Agreement resulting in a Repricing Transaction, the Canadian Borrower shall pay to the Administrative Agent, for the ratable account of each of the applicable Term B-5 Lenders, (I) in the case of clause (x), a prepayment premium of 1% of the amount of the Term B-5 Loans being prepaid and (II) in the case of clause (y), a payment equal to 1% of the aggregate amount of the applicable Term B-5 Loans affected by such Repricing Transaction and outstanding immediately prior to such amendment.

(b) In the event and on such occasion that the Revolving R-3 Facility Credit Exposure exceeds the total Revolving R-3 Facility Commitments, the Canadian Borrower under the Revolving R-3 Facility shall prepay Revolving R-3 Facility Borrowings and/or Swingline Borrowings (or, if no such Borrowings are outstanding, deposit cash collateral in an account with the Administrative Agent pursuant to Section 2.05(i)) made to the Canadian Borrower, in an aggregate amount equal to the amount by which the Revolving R-3 Facility Credit Exposure exceeds the total Revolving R-3 Facility Commitments. Each prepayment shall be applied to the Revolving R-3 Facility Loans included in the repaid Borrowing such that each Revolving R-3 Facility Lender receives its ratable share of such prepayment (based upon the respective Revolving R-3 Facility Credit Exposures of the Revolving R-3 Facility Lenders at the time of such prepayment).

(c) On each occasion that a Prepayment Event occurs, the Canadian Borrower shall cause, within one Business Day after the receipt of Net Cash Proceeds from a Debt Incurrence Event and within three Business Days after the receipt of Net Cash Proceeds in connection with the occurrence of any other Prepayment Event, offer to prepay (or, in the case of a Debt Incurrence Event arising from (A) the incurrence of Incremental Term Loans in reliance on the proviso to Section 2.21(b), or (B) to the extent relating to Term Loans, the incurrence of any Credit Agreement Refinancing Indebtedness (any of the foregoing, a “Specified Debt Incurrence Prepayment Event”), prepay), in accordance with Sections 2.11(c) and (d), without premium or penalty, a principal amount of Term Loans in an amount equal to 100% of the Net Cash Proceeds from such Prepayment Event; provided that, in the case of Net Cash Proceeds from an Asset Sale Event or Casualty Event, the Canadian Borrower may use cash in an amount not to exceed the amount of such Net Cash Proceeds to prepay, redeem, defease, acquire, repurchase or make a similar payment with respect to the Senior Secured Notes, any Permitted Refinancing Indebtedness or any Permitted Additional Debt, in each case, secured by a Lien on the Collateral that ranks equal in priority to the Liens on such Collateral securing the Secured Obligations (but without regard to the control of remedies), in each case the documentation with respect to which requires the issuer or borrower under such Indebtedness to prepay or make an offer to prepay, redeem, repurchase, defease, acquire or satisfy and discharge such Indebtedness with the proceeds of such Prepayment Event, in each case in an amount not to exceed the product of (1) the amount of such Net Cash Proceeds multiplied by (2) a fraction, the numerator of which is the outstanding principal amount of the Senior Secured Notes, Permitted Refinancing Indebtedness and Permitted Additional Debt, in each case, secured by a Lien on the Collateral that ranks equal in priority to the Liens on such Collateral securing the Secured Obligations (but without regard to control of remedies) and with respect to which such a requirement to prepay or make an offer to prepay, redeem, repurchase, defease, acquire or satisfy and discharge exists and the denominator of which is the sum of the outstanding principal amount of the Senior Secured Notes, such Permitted Refinancing Indebtedness and Permitted Additional Debt and the outstanding principal amount of Term Loans.

(d) Not later than 100 days after the end of each Excess Cash Flow Period, the Canadian Borrower shall calculate Excess Cash Flow for such Excess Cash Flow Period and shall cause to be applied an amount equal to the Required Percentage of such Excess Cash Flow (less, at the Canadian Borrower’s option, (i) the aggregate principal amount of Term Loans voluntarily prepaid pursuant to Section 2.12(a) (plus the aggregate principal amount of Term Loans voluntarily prepaid in any of the two most recent Excess Cash Flow Periods preceding such Excess Cash Flow Period that did not reduce the amount of prepayments required by this Section 2.12(d) in such Excess Cash Flow Periods because such voluntary prepayments exceeded the amount of Term Loans required to be prepaid pursuant to Section 2.12(d) in such Excess Cash Flow Periods) and (ii) the aggregate principal amount of Revolving R-3 Facility Loans, Extended Revolving Credit Loans and other revolving loans (other than in the form of Permitted Additional Debt) that are effective in reliance on clause (a) of the definition of Permitted Debt, in each case, voluntarily prepaid to the extent accompanied by a permanent reduction of such Revolving R-3 Facility Commitments, Incremental Revolving Credit Commitment Increases, Extended Revolving Credit Commitments or other revolving commitments, as applicable, in an equal amount in accordance with to Section 2.09 (or equivalent

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provision governing such revolving credit facility) and the aggregate amount of cash consideration paid by any Purchasing Borrower Party to effect any assignment to it of Term Loans pursuant to Section 9.04(e), but only to the extent that such Term Loans (x) have been acquired pursuant to an offer made to all Lenders within any Class of Term Loans on a pro rata basis (in which case, the applicable reduction to the required Excess Cash Flow payment shall be for the amounts owing to such Class only) and (y) have been cancelled, but excluding the aggregate principal amount of any such voluntary prepayments and any such assignments made with the proceeds of incurrences of long-term Indebtedness or issuances of Equity Interests), in each case during such fiscal year or after year-end and prior to the time such prepayment pursuant to this Section 2.12 is due) to prepay Term Loans, in accordance with 2.11; provided that, in the case that Excess Cash Flow is required to be offered to prepay any Term Loans, the Canadian Borrower may use cash in an amount not to exceed the amount of such Excess Cash Flow required to be offered to prepay the Term Loans to prepay, redeem, defease, acquire, repurchase or make a similar payment with respect to any Permitted Refinancing Indebtedness or any Permitted Additional Debt, in each case, secured by a Lien on the Collateral that ranks equal in priority to the Liens on such Collateral securing the Secured Obligations (but without regard to the control of remedies), in each case the documentation with respect to which requires the issuer or borrower under such Indebtedness to prepay or make an offer to prepay, redeem, repurchase, defease, acquire or satisfy and discharge such Indebtedness with a percentage of Excess Cash Flow, in each case in an amount not to exceed the product of (1) the amount of such Excess Cash Flow required to be offered to prepay the Term Loans multiplied by (2) a fraction, the numerator of which is the outstanding principal amount of the Permitted Refinancing Indebtedness and Permitted Additional Debt, in each case, secured by a Lien on the Collateral that ranks equal in priority to the Liens on such Collateral securing the Secured Obligations (but without regard to control of remedies) and with respect to which such a requirement to prepay or make an offer to prepay, redeem, repurchase, defease, acquire or satisfy and discharge exists and the denominator of which is the sum of the outstanding principal amount of such Permitted Refinancing Indebtedness and Permitted Additional Debt and the outstanding principal amount of Term Loans. Not later than the date on which the Canadian Borrower is required to deliver financial statements with respect to the end of each Excess Cash Flow Period under Section 5.04(a), the Canadian Borrower will deliver to the Administrative Agent a certificate signed by a Financial Officer of the Canadian Borrower setting forth the amount, if any, of Excess Cash Flow for such fiscal year and the calculation thereof in reasonable detail.

(e) In lieu of making any payment pursuant to Section 2.12(c) or 2.12(d), in respect of any ~~Eurodollar~~Term Benchmark Loan other than on the last day of the Interest Period thereof, so long as no Default or Event of Default shall have occurred and be continuing, the Canadian Borrower at its option may deposit with the Administrative Agent an amount equal to the amount of the ~~Eurodollar~~Term Benchmark Loan to be prepaid and such ~~Eurodollar~~Term Benchmark Loan shall be repaid on the last day of the Interest Period therefor in the required amount. Such deposit shall be held by the Administrative Agent in a corporate time deposit account established on terms reasonably satisfactory to the Administrative Agent, earning interest at the then-customary rate for accounts of such type. Such deposit shall constitute cash collateral for the Obligations; provided that the Canadian Borrower may at any time direct that such deposit be applied to make the applicable payment required pursuant to Section 2.12(c) or 2.12(d).

(f) Notwithstanding anything in any Loan Document to the contrary so long as no Default has occurred and is continuing and, only to the extent funded at a discount, no proceeds of Revolving R-3 Facility Borrowings are applied to fund any such repayment, the Canadian Borrower and any of its Restricted Subsidiaries may prepay the outstanding Term Loans (which shall, for the avoidance of doubt, be automatically and permanently canceled immediately upon such prepayment) (or the Canadian Borrower or any of its Subsidiaries may purchase such outstanding Term Loans and immediately cancel them) on the following basis:

(i) The Canadian Borrower and its Restricted Subsidiaries shall have the right to make a voluntary prepayment of Term Loans at a discount to par pursuant to a Borrower Offer of Specified Discount Prepayment, Borrower Solicitation of Discount Range Prepayment Offers or Borrower Solicitation of Discounted Prepayment Offers (any such prepayment, the “Discounted Term Loan Prepayment”), in each case made in accordance with this Section 2.12(f); provided that the Canadian Borrower and its Restricted Subsidiaries shall not initiate any action under this Section 2.12(f) in order to make a Discounted Term Loan Prepayment unless (I) at least ten (10) Business Days shall have passed since the consummation of the most recent Discounted Term Loan Prepayment as a result of a prepayment made by the Canadian Borrower or any of its Restricted Subsidiaries on the applicable Discounted Prepayment Effective Date; or (II) at least three Business Days shall have passed since the date the

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Canadian Borrower or such Restricted Subsidiary, as applicable, was notified that no Term Loan Lender was willing to accept any prepayment of any Term Loan at the Specified Discount, within the Discount Range or at any discount to par value, as applicable, or in the case of Borrower Solicitation of Discounted Prepayment Offers, the date of the Canadian Borrower’s or any Restricted Subsidiary’s election not to accept any Solicited Discounted Prepayment Offers.

(ii)

(A) (I) Subject to the proviso to subsection (i) above, the Canadian Borrower or any of its Restricted Subsidiaries may from time to time offer to make a Discounted Term Loan Prepayment by providing the Auction Agent with five (5) Business Days’ notice in the form of a Specified Discount Prepayment Notice; provided that (II) any such offer shall be made available, at the sole discretion of the Canadian Borrower or any such Restricted Subsidiary, as applicable, to (x) each Term Loan Lender and/or (y) each Term Loan Lender with respect to any Class of Term Loans on an individual tranche basis, (III) any such offer shall specify the aggregate principal amount offered to be prepaid (the “Specified Discount Prepayment Amount”) with respect to each applicable tranche, the tranche or tranches of Term Loans subject to such offer and the specific percentage discount to par (the “Specified Discount”) of such Term Loans to be prepaid (it being understood that different Specified Discounts and/or Specified Discount Prepayment Amounts may be offered with respect to different tranches of Term Loans and, in such event, each such offer will be treated as a separate offer pursuant to the terms of this Section 2.12(f)(ii)), (IV) the Specified Discount Prepayment Amount shall be in an aggregate amount not less than $5,000,000 and whole increments of $1,000,000 in excess thereof and (V) each such offer shall remain outstanding through the Specified Discount Prepayment Response Date. The Auction Agent will promptly provide each applicable Lender with a copy of such Specified Discount Prepayment Notice and a form of the Specified Discount Prepayment Response to be completed and returned by each such Term Loan Lender to the Auction Agent (or its delegate) by no later than 5:00 p.m. (New York City time), on the third Business Day after the date of delivery of such notice to such Lenders (the “Specified Discount Prepayment Response Date”).

(B) Each Term Loan Lender receiving such offer shall notify the Auction Agent (or its delegate) by the Specified Discount Prepayment Response Date whether or not it agrees to accept a prepayment of any of its applicable then outstanding Term Loans at the Specified Discount and, if so (such accepting Lender, a “Discount Prepayment Accepting Lender”), the amount and the tranches of such Lender’s Term Loans to be prepaid at such offered discount. Each acceptance of a Discounted Term Loan Prepayment by a Discount Prepayment Accepting Lender shall be irrevocable. Any Term Loan Lender whose Specified Discount Prepayment Response is not received by the Auction Agent by the Specified Discount Prepayment Response Date shall be deemed to have declined to accept the applicable Borrower Offer of Specified Discount Prepayment.

(C) If there is at least one Discount Prepayment Accepting Lender, the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, will make a prepayment of outstanding Term Loans pursuant to this paragraph (B) to each Discount Prepayment Accepting Lender in accordance with the respective outstanding amount and tranches of Term Loans specified in such Lender’s Specified Discount Prepayment Response; provided that if the aggregate principal amount of Term Loans accepted for prepayment by all Discount Prepayment Accepting Lenders exceeds the Specified Discount Prepayment Amount, such prepayment shall be made pro rata among the Discount Prepayment Accepting Lenders in accordance with the respective principal amounts accepted to be prepaid by each such Discount Prepayment Accepting Lender and the Auction Agent (in consultation with the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, and subject to rounding requirements of the Auction Agent made in its reasonable discretion) will calculate such proration (the “Specified Discount Proration”). The Auction Agent shall promptly, and in any case within three Business Days following the Specified Discount Prepayment Response Date, notify (I) the Canadian Borrower or

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the relevant Restricted Subsidiary, as applicable, of the respective Term Loan Lenders’ responses to such offer, the Discounted Prepayment Effective Date and the aggregate principal amount of the Discounted Term Loan Prepayment and the tranches to be prepaid, (II) each Term Loan Lender of the Discounted Prepayment Effective Date, and the aggregate principal amount and the tranches of Term Loans to be prepaid at the Specified Discount on such date and (III) each Discount Prepayment Accepting Lender of the Specified Discount Proration, if any, and confirmation of the principal amount, tranche and Type of Term Loans of such Lender to be prepaid at the Specified Discount on such date. Each determination by the Auction Agent of the amounts stated in the foregoing notices to the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, and such Term Loan Lenders shall be conclusive and binding for all purposes absent manifest error. The payment amount specified in such notice to the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, shall be due and payable by the Canadian Borrower or the relevant Restricted Subsidiary, as applicable on the Discounted Prepayment Effective Date in accordance with subsection (vi) below (subject to subsection (x) below).

(iii)

(A) Subject to the proviso to subsection (i) above, the Canadian Borrower or any of its Restricted Subsidiaries may from time to time solicit Discount Range Prepayment Offers by providing the Auction Agent with five (5) Business Days’ notice in the form of a Discount Range Prepayment Notice; provided that (I) any such solicitation shall be extended, at the sole discretion of the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, to (x) each Term Loan Lender and/or (y) each Term Loan Lender with respect to any Class of Term Loans on an individual tranche basis, (II) any such notice shall specify the maximum aggregate principal amount of the relevant Term Loans (the “Discount Range Prepayment Amount”), the tranche or tranches of Term Loans subject to such offer and the maximum and minimum percentage discounts to par (the “Discount Range”) of the principal amount of such Term Loans with respect to each relevant tranche of Term Loans willing to be prepaid by the Canadian Borrower or the relevant Restricted Subsidiary, as applicable (it being understood that different Discount Ranges and/or Discount Range Prepayment Amounts may be offered with respect to different tranches of Term Loans and, in such event, each such offer will be treated as a separate offer pursuant to the terms of this Section 2.12(f)(iii)), (III) the Discount Range Prepayment Amount shall be in an aggregate amount not less than $5,000,000 and whole increments of $1,000,000 in excess thereof and (IV) each such solicitation by the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, shall remain outstanding through the Discount Range Prepayment Response Date. The Auction Agent will promptly provide each applicable Lender with a copy of such Discount Range Prepayment Notice and a form of the Discount Range Prepayment Offer to be submitted by a responding Lender to the Auction Agent (or its delegate) by no later than 5:00 p.m. (New York City time), on the third Business Day after the date of delivery of such notice to such Lenders (the “Discount Range Prepayment Response Date”). Each Term Loan Lender’s Discount Range Prepayment Offer shall be irrevocable and shall specify a discount to par within the Discount Range (the “Submitted Discount”) at which such Lender is willing to allow prepayment of any or all of its then outstanding Term Loans of the applicable tranche or tranches and the maximum aggregate principal amount and tranches of such Lender’s Term Loans (the “Submitted Amount”) such Term Loan Lender is willing to have prepaid at the Submitted Discount. Any Term Loan Lender whose Discount Range Prepayment Offer is not received by the Auction Agent by the Discount Range Prepayment Response Date shall be deemed to have declined to accept a Discounted Term Loan Prepayment of any of its Term Loans at any discount to their par value within the Discount Range.

(B) The Auction Agent shall review all Discount Range Prepayment Offers received on or before the applicable Discount Range Prepayment Response Date and shall determine (in consultation with the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, and subject to rounding requirements of the Auction Agent made in its sole reasonable discretion) the Applicable Discount and Term Loans to be prepaid at such Applicable Discount in accordance

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with this subsection (iii). the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, agrees to accept on the Discount Range Prepayment Response Date all Discount Range Prepayment Offers received by Auction Agent by the Discount Range Prepayment Response Date, in the order from the Submitted Discount that is the largest discount to par to the Submitted Discount that is the smallest discount to par, up to and including the Submitted Discount that is the smallest discount to par within the Discount Range (such Submitted Discount that is the smallest discount to par within the Discount Range being referred to as the “Applicable Discount”) which yields a Discounted Term Loan Prepayment in an aggregate principal amount equal to the lower of (I) the Discount Range Prepayment Amount and (II) the sum of all Submitted Amounts. Each Term Loan Lender that has submitted a Discount Range Prepayment Offer to accept prepayment at a discount to par that is larger than or equal to the Applicable Discount shall be deemed to have irrevocably consented to prepayment of Term Loans equal to its Submitted Amount (subject to any required proration pursuant to the following subsection (C)) at the Applicable Discount (each such Term Loan Lender, a “Participating Lender”).

(C) If there is at least one Participating Lender, the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, will prepay the respective outstanding Term Loans of each Participating Lender in the aggregate principal amount and of the tranches specified in such Lender’s Discount Range Prepayment Offer at the Applicable Discount; provided that if the Submitted Amount by all Participating Lenders offered at a discount to par greater than or equal to the Applicable Discount exceeds the Discount Range Prepayment Amount, prepayment of the principal amount of the relevant Term Loans for those Participating Lenders whose Submitted Discount is a discount to par greater than or equal to the Applicable Discount (the “Identified Participating Lenders”) shall be made pro rata among the Identified Participating Lenders in accordance with the Submitted Amount of each such Identified Participating Lender and the Auction Agent (in consultation with the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, and subject to rounding requirements of the Auction Agent made in its sole reasonable discretion) will calculate such proration (the “Discount Range Proration”). The Auction Agent shall promptly, and in any case within five (5) Business Days following the Discount Range Prepayment Response Date, notify (I) the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, of the respective Term Loan Lenders’ responses to such solicitation, the Discounted Prepayment Effective Date, the Applicable Discount, and the aggregate principal amount of the Discounted Term Loan Prepayment and the tranches to be prepaid, (II) each Term Loan Lender of the Discounted Prepayment Effective Date, the Applicable Discount, and the aggregate principal amount and tranches of Term Loans to be prepaid at the Applicable Discount on such date, (III) each Participating Lender of the aggregate principal amount and tranches of such Term Loan Lender to be prepaid at the Applicable Discount on such date, and (IV) if applicable, each Identified Participating Lender of the Discount Range Proration. Each determination by the Auction Agent of the amounts stated in the foregoing notices to the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, and Term Loan Lenders shall be conclusive and binding for all purposes absent manifest error. The payment amount specified in such notice to the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, shall be due and payable by the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, on the Discounted Prepayment Effective Date in accordance with subsection (vi) below (subject to subsection (x) below).

(iv)

(A) Subject to the proviso to subsection (i) above, the Canadian Borrower or any of its Restricted Subsidiaries may from time to time solicit Solicited Discounted Prepayment Offers by providing the Auction Agent with five (5) Business Days’ notice in the form of a Solicited Discounted Prepayment Notice; provided that (I) any such solicitation shall be extended, at the sole discretion of the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, to (x) each Term Loan Lender and/or (y) each Lender with respect to any Class of Term Loans on an individual tranche basis, (II) any such notice shall specify the maximum aggregate amount of the

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Term Loans (the “Solicited Discounted Prepayment Amount”) and the tranche or tranches of Term Loans the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, is willing to prepay at a discount (it being understood that different Solicited Discounted Prepayment Amounts may be offered with respect to different tranches of Term Loans and, in such event, each such offer will be treated as a separate offer pursuant to the terms of this Section 2.12(f)(iv)), (III) the Solicited Discounted Prepayment Amount shall be in an aggregate amount not less than $5,000,000 and whole increments of $1,000,000 in excess thereof and (IV) each such solicitation by the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, shall remain outstanding through the Solicited Discounted Prepayment Response Date. The Auction Agent will promptly provide each applicable Lender with a copy of such Solicited Discounted Prepayment Notice and a form of the Solicited Discounted Prepayment Offer to be submitted by a responding Lender to the Auction Agent (or its delegate) by no later than 5:00 p.m. (New York City time), on the third Business Day after the date of delivery of such notice to such Term Loan Lenders (the “Solicited Discounted Prepayment Response Date”). Each Term Loan Lender’s Solicited Discounted Prepayment Offer shall (x) be irrevocable, (y) remain outstanding until the Acceptance Date, and (z) specify both a discount to par (the “Offered Discount”) at which such Term Loan Lender is willing to allow prepayment of its then outstanding Term Loan and the maximum aggregate principal amount and tranches of such Term Loans (the “Offered Amount”) such Term Loan Lender is willing to have prepaid at the Offered Discount. Any Term Loan Lender whose Solicited Discounted Prepayment Offer is not received by the Auction Agent by the Solicited Discounted Prepayment Response Date shall be deemed to have declined prepayment of any of its Term Loans at any discount.

(B) The Auction Agent shall promptly provide the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, with a copy of all Solicited Discounted Prepayment Offers received on or before the Solicited Discounted Prepayment Response Date. the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, shall review all such Solicited Discounted Prepayment Offers and select the largest of the Offered Discounts specified by the relevant responding Term Loan Lenders in the Solicited Discounted Prepayment Offers that is acceptable to the Canadian Borrower or the relevant Restricted Subsidiary, as applicable (the “Acceptable Discount”), if any. If the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, elects to accept any Offered Discount as the Acceptable Discount, then as soon as practicable after the determination of the Acceptable Discount, but in no event later than by the third Business Day after the date of receipt by the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, from the Auction Agent of a copy of all Solicited Discounted Prepayment Offers (the “Acceptance Date”), the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, shall submit an Acceptance and Prepayment Notice to the Auction Agent setting forth the Acceptable Discount. If the Auction Agent shall fail to receive an Acceptance and Prepayment Notice from the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, by the Acceptance Date, the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, shall be deemed to have rejected all Solicited Discounted Prepayment Offers.

(C) Based upon the Acceptable Discount and the Solicited Discounted Prepayment Offers received by Auction Agent by the Solicited Discounted Prepayment Response Date, within three Business Days after receipt of an Acceptance and Prepayment Notice (the “Discounted Prepayment Determination Date”), the Auction Agent will determine (in consultation with the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, and subject to rounding requirements of the Auction Agent made in its sole reasonable discretion) the aggregate principal amount and the tranches of Term Loans (the “Acceptable Prepayment Amount”) to be prepaid by the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, at the Acceptable Discount in accordance with this Section 2.12(f)(iv). If the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, elects to accept any Acceptable Discount, then the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, agrees to accept all Solicited Discounted Prepayment Offers received by Auction Agent by the Solicited Discounted Prepayment Response Date, in the order from largest Offered Discount to smallest Offered Discount, up to and including the Acceptable Discount. Each Term Loan Lender that has submitted a Solicited

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Discounted Prepayment Offer with an Offered Discount that is greater than or equal to the Acceptable Discount shall be deemed to have irrevocably consented to prepayment of Term Loans equal to its Offered Amount (subject to any required pro rata reduction pursuant to the following sentence) at the Acceptable Discount (each such Lender, a “Qualifying Lender”). The Canadian Borrower or the relevant Restricted Subsidiary, as applicable, will prepay outstanding Term Loans pursuant to this subsection (iv) to each Qualifying Lender in the aggregate principal amount and of the tranches specified in such Lender’s Solicited Discounted Prepayment Offer at the Acceptable Discount; provided that if the aggregate Offered Amount by all Qualifying Lenders whose Offered Discount is greater than or equal to the Acceptable Discount exceeds the Solicited Discounted Prepayment Amount, prepayment of the principal amount of the Term Loans for those Qualifying Lenders whose Offered Discount is greater than or equal to the Acceptable Discount (the “Identified Qualifying Lenders”) shall be made pro rata among the Identified Qualifying Lenders in accordance with the Offered Amount of each such Identified Qualifying Lender and the Auction Agent (in consultation with the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, and subject to rounding requirements of the Auction Agent made in its sole reasonable discretion) will calculate such proration (the “Solicited Discount Proration”). On or prior to the Discounted Prepayment Determination Date, the Auction Agent shall promptly notify (I) the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, of the Discounted Prepayment Effective Date and Acceptable Prepayment Amount comprising the Discounted Term Loan Prepayment and the tranches to be prepaid, (II) each Term Loan Lender of the Discounted Prepayment Effective Date, the Acceptable Discount, and the Acceptable Prepayment Amount of all Term Loans and the tranches to be prepaid to be prepaid at the Applicable Discount on such date, (III) each Qualifying Lender of the aggregate principal amount and the tranches of such Term Loan Lender to be prepaid at the Acceptable Discount on such date, and (IV) if applicable, each Identified Qualifying Lender of the Solicited Discount Proration. Each determination by the Auction Agent of the amounts stated in the foregoing notices to the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, and Term Loan Lenders shall be conclusive and binding for all purposes absent manifest error. The payment amount specified in such notice to the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, shall be due and payable by the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, on the Discounted Prepayment Effective Date in accordance with subsection (vi) below (subject to subsection (x) below).

(v) In connection with any Discounted Term Loan Prepayment, the Canadian Borrower, its Restricted Subsidiaries and the Term Loan Lenders acknowledge and agree that the Auction Agent may require as a condition to any Discounted Term Loan Prepayment, the payment of customary fees and expenses from the Canadian Borrower or its Restricted Subsidiaries, as applicable, in connection therewith.

(vi) If any Term Loan is prepaid in accordance with paragraphs (ii) through (iv) above, the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, shall prepay such Term Loans on the Discounted Prepayment Effective Date. The Canadian Borrower or the relevant Restricted Subsidiary, as applicable, shall make such prepayment to the Administrative Agent, for the account of the Discount Prepayment Accepting Lenders, Participating Lenders, or Qualifying Lenders, as applicable, at the Administrative Agent’s Office in immediately available funds not later than 11:00 a.m. (New York City time) on the Discounted Prepayment Effective Date and all such prepayments shall be applied to the remaining principal installments of the relevant tranche of Loans on a pro rata basis across such installments. The Term Loans so prepaid shall be accompanied by all accrued and unpaid interest on the par principal amount so prepaid up to, but not including, the Discounted Prepayment Effective Date. Each prepayment of the outstanding Term Loans pursuant to this Section 2.12(f) shall be paid to the Discount Prepayment Accepting Lenders, Participating Lenders, or Qualifying Lenders, as applicable, and shall be applied to the relevant Loans of such Lenders in accordance with their respective pro rata share. The aggregate principal amount of the tranches and installments of the relevant Term Loans outstanding shall be deemed reduced by the full par value of the aggregate principal amount of the tranches of Term Loans prepaid on the Discounted Prepayment Effective Date in any Discounted Term Loan Prepayment. In connection with each prepayment pursuant to this Section 2.12(f), the Canadian Borrower or the relevant

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Restricted Subsidiary, as applicable, shall waive any right to bring any action against the Administrative Agent, in its capacity as such, in connection with any such Discounted Term Loan Prepayment.

(vii) To the extent not expressly provided for herein, each Discounted Term Loan Prepayment shall be consummated pursuant to procedures consistent with the provisions in this Section 2.12(f), established by the Auction Agent acting in its reasonable discretion and as reasonably agreed by the Canadian Borrower.

(viii) Notwithstanding anything in any Loan Document to the contrary, for purposes of this Section 2.12(f), each notice or other communication required to be delivered or otherwise provided to the Auction Agent (or its delegate) shall be deemed to have been given upon Auction Agent’s (or its delegate’s) actual receipt during normal business hours of such notice or communication; provided that any notice or communication actually received outside of normal business hours shall be deemed to have been given as of the opening of business on the next Business Day.

(ix) The Canadian Borrower, its Restricted Subsidiaries and the Term Loan Lenders acknowledge and agree that the Auction Agent may perform any and all of its duties under this Section 2.12(f) by itself or through any Affiliate of the Auction Agent and expressly consents to any such delegation of duties by the Auction Agent to such Affiliate and the performance of such delegated duties by such Affiliate. The exculpatory provisions pursuant to this Agreement shall apply to each Affiliate of the Auction Agent and its respective activities in connection with any Discounted Term Loan Prepayment provided for in this Section 2.12(f) as well as activities of the Auction Agent.

(x) The Canadian Borrower or the relevant Restricted Subsidiary, as applicable, shall have the right, by written notice to the Auction Agent, to revoke in full (but not in part) its offer to make a Discounted Term Loan Prepayment and rescind the applicable Specified Discount Prepayment Notice, Discount Range Prepayment Notice or Solicited Discounted Prepayment Notice therefor at its discretion at any time on or prior to the applicable Specified Discount Prepayment Response Date (and if such offer is revoked pursuant to the preceding clauses, any failure by the Canadian Borrower or the relevant Restricted Subsidiary, as applicable, to make any prepayment to a Lender, as applicable, pursuant to this Section 2.12(f) shall not constitute a Default or Event of Default under Section 7.01 or otherwise).

(g)

(i) With respect to each prepayment of Revolving R-3 Facility Loans and Extended Revolving Credit Loans pursuant to this Section 2.12, the Canadian Borrower may designate (i) the Class and Types of Loans that are to be prepaid and the specific Borrowing(s) pursuant to which such Loans were made and (ii) the Class of Revolving R-3 Facility Loans or Extended Revolving Credit Loans to be prepaid; provided that (x) ~~Eurodollar~~Term Benchmark Loans may be designated for prepayment pursuant to this Section 2.12 only on the last day of an Interest Period applicable thereto unless all ~~Eurodollar~~Term Benchmark Loans with Interest Periods ending on such date of required prepayment and all ABR Loans have been paid in full; (y) each prepayment of any Loans made pursuant to a Borrowing shall be applied pro rata among such Loans of such Class (except that any prepayment made in connection with a reduction of the Commitments of such Class pursuant to Section 2.09 shall be applied pro rata based on the amount of the reduction in the Commitments of such Class of each applicable Lender); and (z) notwithstanding the provisions of the preceding clause (y), at the option of the Canadian Borrower, no prepayment made pursuant to Section 2.12 of Revolving R-3 Facility Loans or Extended Revolving Credit Loans of any Class shall be applied to the Loans of any Defaulting Lender. In the absence of a designation by the Canadian Borrower as described in the preceding sentence, the Administrative Agent shall, subject to the above, make such designation in a manner that minimizes the amount of any payments required to be made by the Canadian Borrower.

(ii) With respect to each mandatory reduction and termination of Revolving R-3 Facility Commitments (and any previously extended Extended Revolving Credit Commitments) required by either clause (i) or (ii) of the proviso to Section 2.21(b) or in connection with the incurrence of any Credit

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Agreement Refinancing Indebtedness incurred to Refinance any Revolving R-3 Facility Commitments and/or Extended Revolving Credit Commitments, the Canadian Borrower may designate (A) the Classes of Commitments to be reduced and terminated and (B) the corresponding Classes of Loans to be prepaid; provided that (x) any such reduction and termination shall apply proportionately and permanently to reduce the Commitments of each of the Lenders within any such Class and (y) after giving pro forma effect to such termination or reduction and to any prepayments of Loans or cancellation or cash collateralization of letters of credit made on the date of each such reduction and termination in accordance with this Agreement, the aggregate amount of such Lenders’ credit exposures shall not exceed the remaining Commitments of such Lenders’ in respect of the Class reduced and terminated. In connection with any such termination or reduction, to the extent necessary, the participations hereunder in outstanding Letters of Credit and Swingline Loans may be required to be reallocated and related loans outstanding prepaid and then reborrowed, in each case in the manner contemplated by Section 2.21(f)(ii) (as modified to account for a termination or reduction, as opposed to an increase, of such Commitment).

(h) Notwithstanding any other provisions of this Section 2.12, (i) to the extent that any of or all the Net Cash Proceeds of any asset sale by a Non-Subsidiary Loan Party giving rise to an Asset Sale Event (a “Non-Loan Party Asset Sale”), the Net Cash Proceeds of any Casualty Event from a Non-Subsidiary Loan Party (a “Non-Loan Party Casualty Event”) or Excess Cash Flow, are prohibited, delayed or restricted by applicable local law, rule or regulation from being repatriated to the United States or from being distributed to a Loan Party, an amount equal to the portion of such Net Cash Proceeds or Excess Cash Flow so affected will not be required to be applied to repay Term Loans at the times provided in this Section 2.12 so long, but only so long, as the applicable local law, rule or regulation will not permit repatriation to the United States or distribution to a Loan Party (the Canadian Borrower hereby agreeing to cause the applicable Non-Subsidiary Loan Party to promptly take all commercially reasonable actions required by the applicable local law, rule or regulation to permit such repatriation or distribution), and once such repatriation or distribution of any of such affected Net Cash Proceeds or Excess Cash Flow is permitted under the applicable local law, rule or regulation, such repatriation or distribution will be immediately effected and an amount equal to such repatriated or distributed Net Cash Proceeds or Excess Cash Flow will be promptly (and in any event not later than two Business Days after such repatriation or distribution) applied (net of additional taxes payable or reserved against as a result thereof) to the repayment of the Term Loans (and, if applicable, such other Indebtedness as is contemplated by this Section 2.12) pursuant to this Section 2.12 and (ii) to the extent that the Canadian Borrower has determined in good faith that repatriation of any of or all the Net Cash Proceeds of any Non-Subsidiary Loan Party Asset Sale, any Non-Loan Party Casualty Event or Excess Cash Flow would have a material adverse tax cost consequence with respect to such Net Cash Proceeds or Excess Cash Flow (but only for so long as such material adverse tax cost consequence exists), the Net Cash Proceeds or Excess Cash Flow so affected will not be required to be applied to repay Term Loans at the times provided in this Section 2.12; provided that, in the case of this clause (ii), on or before the date on which an amount equal to any Net Cash Proceeds from any Non-Loan Party Asset Sale or Non-Loan Party Casualty Event so retained would otherwise have been required to be applied to reinvestments or prepayments pursuant to Section 2.12(c) (or, in the case of Excess Cash Flow, a date on or before the date that is six months after the date such Excess Cash Flow would have been so required to be applied to prepayments pursuant to Section 2.12(d) unless previously repatriated in which case such repatriated Excess Cash Flow shall have been promptly applied to the repayment of the Term Loans pursuant to Section 2.12(d)), (x) the Canadian Borrower applies an amount equal to such Net Cash Proceeds or Excess Cash Flow to such reinvestments or prepayments as if such Net Cash Proceeds or Excess Cash Flow had been received by the Canadian Borrower rather than such Non-Subsidiary Loan Party, less the amount of additional taxes that would have been payable or reserved against if such Net Cash Proceeds or Excess Cash Flow had been repatriated (or, if less, the Net Cash Proceeds or Excess Cash Flow that would be calculated if received by such Non-Subsidiary Loan Party) or (y) such Net Cash Proceeds or Excess Cash Flow are applied to the repayment of Indebtedness of a Non-Subsidiary Loan Party.

Section 2.13 Fees.

(a) The Canadian Borrower agrees to pay to each Revolving R-3 Facility Lender (other than any Defaulting Lender), through the Administrative Agent, five Business Days after the last day of March, June, September and December in each year, and three Business Days after the date on which the Revolving R-3 Facility Commitments of all the Lenders shall be terminated as provided herein, a commitment fee (a “Revolving R-3 Facility Commitment Fee”) in Dollars on the daily amount of the Available Revolving Unused Commitment of such Lender

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during the preceding quarter (or other period commencing with the Amendment No. 6 Effective Date or ending with the date on which the last of the Revolving R-3 Facility Commitment of such Lender shall be terminated) at a rate per annum equal to the Commitment Fee Rate in effect on such day. All Revolving R-3 Facility Commitment Fees shall be computed on the basis of the actual number of days elapsed in a year of 365 days. For the purpose of calculating any Lender’s Revolving R-3 Facility Commitment Fee, the outstanding Swingline Loans during the period for which such Lender’s Revolving R-3 Facility Commitment Fee is calculated shall be deemed to be zero. The Revolving R-3 Facility Commitment Fee due to each Lender shall commence to accrue on the Amendment No. 6 Effective Date and shall cease to accrue on the date on which the last of the Revolving R-3 Facility Commitments of such Lender shall be terminated as provided herein.

(b) The Canadian Borrower agrees to pay from time to time (i) to each Revolving R-3 Facility Lender (other than any Defaulting Lender), through the Administrative Agent, ten Business Days after the last day of March, June, September and December of each year and three Business Days after the date on which the Revolving R-3 Facility Commitments of all the Lenders shall be terminated as provided herein, a fee (an “L/C Participation Fee”) in Dollars on such Lender’s Revolving R-3 Facility Percentage of the daily aggregate Revolving L/C Exposure (excluding the portion thereof attributable to unreimbursed L/C Disbursements), during the preceding quarter (or shorter period commencing with the Amendment No. 2 Effective Date or ending with the date on which the Revolving R-3 Facility Commitments shall be terminated) at the rate per annum equal to the Applicable Margin for BA Borrowings effective for each day in such period, and (ii) to each L/C Issuer, for its own account, (x) 10 Business Days after the last day of March, June, September and December of each year and three Business Days after the date on which the Revolving R-3 Facility Commitments of all the Lenders shall be terminated as provided herein, a fronting fee in Dollars in respect of each Letter of Credit issued by such L/C Issuer for the period from and including the date of issuance of such Letter of Credit to and including the termination of such Letter of Credit, computed at a rate equal to 0.125% (or such other amount as may be agreed upon between the Canadian Borrower and any such L/C Issuer) per annum of the daily stated amount (or, if applicable, the Dollar Equivalent) of such Letter of Credit) (with the minimum annual fronting fee for each Letter of Credit to be not less than $500) plus (y) in connection with the issuance, amendment or transfer of any such Letter of Credit or any L/C Disbursement thereunder, such L/C Issuer’s customary documentary and processing charges (collectively, “L/C Issuer Fees”). All L/C Participation Fees and L/C Issuer Fees that are payable on a per annum basis shall be computed on the basis of the actual number of days elapsed in a year of 360 days.

(c) The Canadian Borrower agrees to pay to the Administrative Agent, for the accounts of each Lender making a BA Loan, on the date of such Loan, a fee, in Canadian Dollars, calculated by multiplying the face amount of each BA (or, if applicable, the principal amount of each BA Equivalent Loan before discounting) comprising the BA Loan by the product of (i) the Applicable Margin for such BA Loan and (ii) a fraction, the numerator of which is the number of days in the BA Contract Period applicable to such BA (or BA Equivalent Loan) and the denominator of which is 365 or 366, as applicable (“Acceptance Fees”).

(d) [Reserved].

(e) The Canadian Borrower agrees to pay to the Administrative Agent, for its own account, the fees set forth in the Fee Letter, as amended, restated, supplemented or otherwise modified from time to time, at the times specified therein (the “Agent Fees”).

(f) All Fees shall be paid on the dates due, in immediately available funds, to the Administrative Agent for distribution, if and as appropriate, among the Lenders, except that L/C Issuer Fees shall be paid directly to the applicable L/C Issuer. Once paid, none of the Fees shall be refundable under any circumstances.

Section 2.14 Interest.

(a) The Loans comprising each ABR Borrowing (including each Swingline Loan and excluding each BA Loan) shall bear interest at the Alternate Base Rate plus the Applicable Margin.

(b) The Loans comprising each ~~Eurodollar~~Term Benchmark Borrowing shall bear interest at the Adjusted ~~LIBO~~Term SOFR Rate for the Interest Period in effect for such Borrowing plus the Applicable Margin.

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(c) Notwithstanding the foregoing, if any principal of or interest on any Loan or any Fees or other amount payable by the Canadian Borrower hereunder is not paid when due, whether at stated maturity, upon acceleration or otherwise, such overdue principal amount shall bear interest, and each such other overdue amount shall, to the extent permitted by law, bear interest, in each case after as well as before judgment, at a rate per annum equal to (i) in the case of overdue principal of any Loan, 2% plus the rate otherwise applicable to such Loan as provided in the preceding paragraphs of this Section 2.14 (except, in the case of BA Loans, in which case such overdue principal shall bear interest at the rate of 2% plus the Applicable Margin for BA Loans) or (ii) in the case of any other amount, 2% plus the rate applicable to Revolving R-3 Facility Loans that are ABR Revolving Loans as provided in paragraph (a) of this Section 2.14.

(d) Accrued interest on each Loan shall be payable in arrears (i) on each Interest Payment Date for such Loan, (ii) in the case of Revolving R-3 Facility Loans, upon termination of the Revolving R-3 Facility Commitments and (iii) in the case of Term B-5 Loans, on the Term B-5 Loan Maturity Date; provided that (i) interest accrued pursuant to paragraph (c) of this Section 2.14 shall be payable on demand, (ii) in the event of any prepayment of any Loan (other than a prepayment of an ABR Revolving Loan or Swingline Loan prior to the end of the Revolving Availability Period), accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any ~~Eurodollar~~Term Benchmark Loan or prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion.

(e) All interest hereunder shall be computed on the basis of a year of 360 days, except that interest computed by reference to the Alternate Base Rate at times when the Alternate Base Rate is based on the Prime Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year), and in each case shall be payable for the actual number of days elapsed (including the first day but excluding the last day). The applicable Alternate Base Rate, BA Discount Rate, Adjusted ~~LIBO~~Term SOFR Rate or ~~LIBO~~Term SOFR Rate shall be determined by the Administrative Agent, and such determination shall be prima facie evidence thereof.

(f) Criminal Interest Rate/Interest Act (Canada).

(i) For purposes of the Interest Act (Canada), whenever any interest or fee is calculated on the basis of a period of time other than a year of 365 or 366 days, as applicable, the annual rate to which each rate utilized pursuant to such calculation is equivalent is such rate so utilized multiplied by the actual number of days in the calendar year in which the same is to be ascertained and divided by the number of days used in such calculation. For the purposes of the Interest Act (Canada), the principle of deemed reinvestment of interest will not apply to any interest calculation under the Loan Documents, and the rates of interest stipulated in this Agreement are intended to be nominal rates and not effective rates or yields.

(ii) If any provision of this Agreement or any of the other Loan Documents would obligate the Canadian Borrower to make any payment of interest or other amount payable to any Lender under any Loan Documents in an amount or calculated at a rate which would be prohibited by law or would result in a receipt by that Lender of interest at a criminal rate (as construed under the Criminal Code (Canada)), then notwithstanding that provision, that amount or rate shall be deemed to have been adjusted with retroactive effect to the maximum amount or rate of interest, as the case may be, as would not be so prohibited by law or result in a receipt by that Lender of interest at a criminal rate, the adjustment to be effected, to the extent necessary, (A) first, by reducing the amount or rate of interest required to be paid to the affected Lender under this Section 2.14 and the amount of discount applicable to BA Loans made under this Agreement and (B) thereafter, by reducing any fees, commissions, premiums and other amounts required to be paid to the affected Lender which would constitute interest for purposes of Section 347 of the Criminal Code (Canada).

(iii) Notwithstanding clause (ii) above, and after giving effect to all adjustments contemplated thereby, if any Lender shall have received an amount in excess of the maximum permitted by the Criminal Code (Canada), then the Canadian Borrower shall be entitled, by notice in writing to the affected Lender, to obtain reimbursement from that Lender in an amount equal to the excess, and pending reimbursement, the amount of the excess shall be deemed to be an amount payable by that Lender to the Canadian Borrower.

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(iv) Any amount or rate of interest referred to in this Section 2.14(f) shall be determined in accordance with generally accepted actuarial practices and principles as an effective annual rate of interest over the term of this Agreement on the assumption that any charges, fees or expenses that fall within the meaning of interest (as defined in the Criminal Code (Canada)) shall be prorated over that period of time and, in the event of a dispute, a certificate of a Fellow of the Canadian Institute of Actuaries appointed by the Administrative Agent shall be conclusive for the purposes of that determination.

Section 2.15 Alternate Rate of Interest. (a) ~~If prior to the commencement of any InterestPeriod for a Eurodollar Borrowing denominated in Dollars~~Subject to clauses (b), (c), (d), (e) and (f) of this Section 2.15, if:

(i)

the Administrative Agent determines (which determination shall be conclusive absent manifest error) prior to the commencement of any Interest Period for a Term Benchmark Borrowing, that adequate and reasonable means do not exist for ascertaining the Adjusted ~~LIBO~~Term SOFR Rate or the ~~LIBO~~Term SOFR Rate~~, as applicable~~ (including because the ~~applicable~~Term SOFR Reference Rate is not available or published on a current basis), for such Interest Period; ~~provided~~ ~~that no Benchmark Transition Event shall have occurred at such time;~~ or

(ii)

the Administrative Agent is advised by the Required Lenders that prior to the commencement of any Interest Period for a Term Benchmark Borrowing, the Adjusted ~~LIBO~~Term SOFR Rate ~~or the LIBO Rate, as applicable,~~ for such Interest Period will not adequately and fairly reflect the cost to such Lenders (or Lender) of making or maintaining their Loans (or its Loan) included in such Borrowing for such Interest Period;

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then the Administrative Agent shall give written notice thereof to the Canadian Borrower and the Lenders by ~~telephone,~~ telecopy or electronic mail as promptly as practicable thereafter and, until (x) the Administrative Agent notifies the Canadian Borrower and the Lenders that the circumstances giving rise to such notice no longer exist~~,~~ with respect to the relevant Benchmark and (~~A~~y) the Canadian Borrower delivers a new Interest Election Request in accordance with the terms of Section 2.08 or a new Borrowing Request in accordance with the terms of Section 2.03, any Interest Election Request that requests the conversion of any Borrowing to, or continuation of any Borrowing as, a ~~Eurodollar~~Term Benchmark Borrowing ~~shall be ineffective~~ and ~~(B)if~~ any Borrowing Request that requests a ~~EurodollarBorrowing, such~~Term Benchmark Borrowing shall ~~bemade as~~instead be deemed to be an Interest Election Request or a Borrowing Request, as applicable, for an ABR Borrowing; provided that if the circumstances giving rise to such notice affect only one Type of Borrowings, then ~~the~~all other ~~Type~~Types of Borrowings shall be permitted. Furthermore, if any Term Benchmark Loan is outstanding on the date of the Canadian Borrower’s receipt of the notice from the Administrative Agent referred to in this Section 2.15(a) with respect to a Benchmark applicable to such Term Benchmark Loan, then until (x) the Administrative Agent notifies the Canadian Borrower and the Lenders that the circumstances giving rise to such notice no longer exist with respect to the relevant Benchmark and (y) the Canadian Borrower delivers a new Interest Election Request in accordance with the terms of Section 2.08 or a new Borrowing Request in accordance with the terms of Section 2.03, any Term Benchmark Loan shall on the last day of the Interest Period applicable to such Loan (or the next succeeding Business Day if such day is not a Business Day), be converted by the Administrative Agent to, and shall constitute, an ABR Loan on such day.

(b) Notwithstanding anything to the contrary herein or in any other Loan Document, ~~upon the occurrence of~~if a Benchmark Transition Event ~~or an Early Opt-in Election, as applicable, the Administrative Agentand the Canadian Borrower may amend this Agreement to replace the LIBO Rate applicable to Borrowings denominated in Dollars with a BenchmarkReplacement. Any such amendment with respect to a Benchmark Transition Event will become effective at~~and its related Benchmark Replacement Date have occurred prior to the Reference Time in respect of any setting of the then-current Benchmark, then (x) if a Benchmark Replacement is determined in accordance with clause (1) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any Loan Document in respect of such Benchmark setting and subsequent Benchmark settings without any amendment to, or further action or consent of any other party to, this Agreement or any other Loan Document and (y) if a Benchmark Replacement is determined in accordance with clause (2) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark

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for all purposes hereunder and under any Loan Document in respect of any Benchmark setting at or after 5:00 p.m. (New York City time) on the fifth (5th) Business Day after the ~~Administrative Agent has posted suchproposed amendment to all Lenders and the Canadian Borrower,~~date notice of such Benchmark Replacement is provided to the Lenders without any amendment to, or further action or consent of any other party to, this Agreement or any other Loan Document so long as the Administrative Agent has not received, by such time, written notice of objection to such ~~proposed amendment~~Benchmark Replacement from Lenders comprising the Required Lenders~~; provided that, with respect to anyproposed amendment containing any SOFR-Based Rate, the Lenders shall be entitled to object only to the Benchmark Replacement Adjustmentcontained therein. Any such amendment with respect to an Early Opt-in Election will become effective on the date that Lenders comprisingthe Required Lenders have delivered to the Administrative Agent written notice that such Required Lenders accept such amendment. No replacementof LIBO Rate with a Benchmark Replacement will occur prior to the applicable Benchmark Transition Start Date~~.

(c) ~~Inconnection with the implementation of a Benchmark Replacement~~Notwithstanding anything to the contrary herein or in any other Loan Document, the Administrative Agent will have the right to make Benchmark Replacement Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing such Benchmark Replacement Conforming Changes will become effective without any further action or consent of any other party to this Agreement or any other Loan Document.

(d) The Administrative Agent will promptly notify the Canadian Borrower and the Lenders of (i) any occurrence of a Benchmark Transition Event ~~or an Early Opt-in Election, as applicable,~~ , (ii) the implementation of any Benchmark Replacement, (iii) the effectiveness of any Benchmark Replacement Conforming Changes, (iv) the removal or reinstatement of any tenor of a Benchmark pursuant to clause (e) below and (~~iv~~v) the commencement or conclusion of any Benchmark Unavailability Period. Any determination, decision or election that may be made by the ~~Canadian Borrower,~~ Administrative Agent or ~~Required~~, if applicable, any Lender (or group of Lenders) pursuant to this Section 2.15, including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action or any selection, will be conclusive and binding absent manifest error and may be made in its or their sole discretion and without consent from any other party ~~hereto~~to this Agreement or any other Loan Document, except, in each case, as expressly required pursuant to this Section 2.15.

~~(e)~~

(e) Notwithstanding anything to the contrary herein or in any other Loan Document, at any time (including in connection with the implementation of a Benchmark Replacement), (i) if the then-current Benchmark is a term rate (including the Term SOFR Rate) and either (A) any tenor for such Benchmark is not displayed on a screen or other information service that publishes such rate from time to time as selected by the Administrative Agent in its reasonable discretion or (B) the regulatory supervisor for the administrator of such Benchmark has provided a public statement or publication of information announcing that any tenor for such Benchmark is or will be no longer representative, then the Administrative Agent may modify the definition of “Interest Period” for any Benchmark settings at or after such time to remove such unavailable or non-representative tenor and (ii) if a tenor that was removed pursuant to clause (i) above either (A) is subsequently displayed on a screen or information service for a Benchmark (including a Benchmark Replacement) or (B) is not, or is no longer, subject to an announcement that it is or will no longer be representative for a Benchmark (including a Benchmark Replacement), then the Administrative Agent may modify the definition of “Interest Period” for all Benchmark settings at or after such time to reinstate such previously removed tenor.

(f) Upon the Canadian Borrower’s receipt of notice of the commencement of a Benchmark Unavailability Period, the Canadian Borrower may revoke any request for a ~~Eurodollar~~Term Benchmark Borrowing of, conversion to or continuation of ~~Eurodollar~~Term Benchmark Loans to be made, converted or continued during any Benchmark Unavailability Period and, failing that, the Canadian Borrower will be deemed to have converted any such request for a Term Benchmark Borrowing into a request for a ~~borrowing~~Borrowing of or conversion to an ABR ~~Loans~~Borrowing. During any Benchmark Unavailability Period or at any time that a tenor for the then-current Benchmark is not an Available Tenor, the component of Alternate Base Rate based upon the ~~AdjustedLIBO Rate~~then-current Benchmark or such tenor for such Benchmark, as applicable, will not be used in any determination of the Alternate Base Rate. Furthermore, if any Term Benchmark Loan is outstanding on the

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date of the Canadian Borrower’s receipt of notice of the commencement of a Benchmark Unavailability Period with respect to the Benchmark applicable to such Term Benchmark Loan, then until such time as a Benchmark Replacement is implemented pursuant to this Section 2.15, any Term Benchmark Loan shall on the last day of the Interest Period applicable to such Loan (or the next succeeding Business Day if such day is not a Business Day), be converted by the Administrative Agent to, and shall constitute, an ABR Loan on such day.

Section 2.16 Increased Costs.

(a) If any Change in Law shall:

(i) impose, modify or deem applicable any reserve, special deposit or similar requirement against assets of, deposits with or for the account of, or credit extended by, any Lender ~~(except any such reserve requirement reflected in the Adjusted LIBORate)~~ or L/C Issuer;

(ii) subject any Lender or L/C Issuer to any Tax (other than (A) Indemnified Taxes or (B) Excluded Taxes);

(iii) impose on any Lender or L/C Issuer or the ~~London~~applicable offshore interbank market any other condition affecting this Agreement or ~~Eurodollar~~Term Benchmark Loans or BA Loans made by such Lender or any Letter of Credit or participation therein;

and the result of any of the foregoing shall be to increase the cost to such Lender of making or maintaining any ~~Eurodollar~~Term Benchmark Loan or BA Loan (or of maintaining its obligation to make any such Loan) or to increase the cost to such Lender or L/C Issuer of participating in, issuing or maintaining any Letter of Credit or to reduce the amount of any sum received or receivable by such Lender or L/C Issuer hereunder (whether of principal, interest or otherwise), in each case determined to be material by such Lender, then the Canadian Borrower will pay to such Lender or L/C Issuer, as applicable, such additional amount or amounts as will compensate such Lender or L/C Issuer, as applicable, for such additional costs incurred or reduction suffered.

(b) If any Lender or L/C Issuer determines that any Change in Law regarding capital requirements has or would have the effect of reducing the rate of return on such Lender’s or L/C Issuer’s capital or on the capital of such Lender’s or L/C Issuer’s holding company, if any, as a consequence of this Agreement or the Loans made by, or participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by such L/C Issuer, to a level below that which such Lender or such L/C Issuer or such Lender’s or such L/C Issuer’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s or such L/C Issuer’s policies and the policies of such Lender’s or such L/C Issuer’s holding company with respect to capital adequacy) and determined to be material by such Lender, then from time to time the Canadian Borrower shall pay to such Lender or such L/C Issuer, as applicable, such additional amount or amounts as will compensate such Lender or such L/C Issuer or such Lender’s or such L/C Issuer’s holding company for any such reduction suffered.

(c) A certificate of a Lender or a L/C Issuer setting forth the amount or amounts necessary to compensate such Lender or L/C Issuer or its holding company, as applicable, as specified in paragraph (a) or (b) of this Section (as well as reasonably detailed calculations thereof) shall be delivered to the Canadian Borrower and shall be prima facie evidence of the amounts thereof. The applicable Borrower shall pay such Lender or L/C Issuer, as applicable, the amount shown as due on any such certificate within 10 days after receipt thereof.

(d) Promptly after any Lender or any L/C Issuer has determined that it will make a request for increased compensation pursuant to this Section 2.16, such Lender or L/C Issuer shall notify the Canadian Borrower thereof. Failure or delay on the part of any Lender or L/C Issuer to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s or L/C Issuer’s right to demand such compensation; provided that the Canadian Borrower shall not be required to compensate a Lender or a L/C Issuer pursuant to this Section for any increased costs or reductions incurred more than 180 days prior to the date that such Lender or L/C Issuer, as applicable, notifies the Canadian Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s or L/C Issuer’s intention to claim compensation therefor; provided, further, that, if the Change

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in Law giving rise to such increased costs or reductions is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof.

(e) Notwithstanding the foregoing, no Lender or L/C Issuer shall be entitled to seek compensation under this Section 2.16 based on the occurrence of a Change in Law unless such Lender or L/C Issuer is generally seeking compensation from other borrowers in the U.S. leveraged loan market with respect to its similarly affected commitments, loans and/or participations under agreements with such borrowers having provisions similar to this Section 2.16.

Section 2.17 Break Funding Payments. In the event of (a) the payment of any principal of any ~~Eurodollar~~Term Benchmark Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion of any ~~Eurodollar~~Term Benchmark Loan other than on the last day of the Interest Period applicable thereto, (c) the failure to borrow, convert, continue or prepay any Loan on the date specified in any notice delivered pursuant hereto or (d) the assignment of any ~~Eurodollar~~Term Benchmark Loan or BA Loan other than on the last day of the Interest Period applicable thereto as a result of a request by the Canadian Borrower pursuant to Section 2.20, then, in any such event, the Canadian Borrower shall compensate each Lender for the loss, cost and expense (but exclusive of lost profit or margin) attributable to such event. ~~In the case ofa Eurodollar Loan, such loss, cost or expense to any Lender shall be deemed to be the amount reasonably determined by such Lender tobe the excess, if any, of (i) the amount of interest which would have accrued on the principal amount of such Loan had such event notoccurred, at the Adjusted LIBO Rate that would have been applicable to such Loan, for the period from the date of such event to the lastday of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or continue a Eurodollar Loan, forthe period that would have been the Interest Period for such Loan), over (ii) the amount of interest which would accrue on such principalamount for such period at the interest rate which such Lender would bid were it to bid, at the commencement of such period, for depositsin Euros of a comparable amount and period from other banks in the Eurodollar market.~~ In the case of any BA Loan, such loss, cost or expense to any Lender shall be deemed to be the amount reasonably determined by such Lender to be the excess, if any, of (x) in the case of an event described in clause (c) above, the face amount of the BAs accepted and purchased by such Lender (or, if applicable, the principal amount of the BA Equivalent Loan made) for the purpose of such BA Loan minus the Discount Proceeds of such BAs (or BA Equivalent Loan) and (y) in the case of an event described in clause (d) above, the face amount of such BAs (or, if applicable, the principal amount of such BA Equivalent Loan) minus amounts received as a result of such assignment, over the amount of interest that would accrue on such principal amount for such period at the interest rate such Lender would bid were it to bid at the commencement of such period for deposits in Canadian Dollars of a comparable amount and period from other banks in the Canadian interbank market. ~~A~~In the case of both Term Benchmark Loans and BA Loans, a certificate of any Lender setting forth any amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to the Canadian Borrower and shall be prima facie evidence of the amounts thereof. The Canadian Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

Section 2.18 Taxes.

(a) All payments by or on account of any obligation of any Loan Party under any Loan Document shall be made without deduction or withholding for any Taxes except as required by applicable law; provided that if any applicable Withholding Agent shall be required by applicable law to deduct or withhold any Taxes from such payments, then (i) if such Taxes are Indemnified Taxes, the sum payable by the applicable Loan Party shall be increased as necessary so that after all such deductions or withholdings have been made (including such deductions and withholdings applicable to additional sums payable under this Section 2.18) any Lender (or, in the case of any amount received by any Agent for its account, such Agent) receives an amount equal to the sum it would have received had no such deduction or withholding been made, (ii) the applicable Withholding Agent shall be entitled to make such deduction or withholding and shall timely pay the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law.

(b) The Loan Parties shall pay to the relevant Governmental Authority in accordance with applicable law, or at the option of the Administrative Agent timely reimburse it for the payment of, any Other Taxes.

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(c) Each Loan Party shall indemnify the Agents and each Lender, within 20 days after written demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section 2.18) paid or payable by such Agent or Lender, as applicable, or required to be withheld or deducted with respect to a payment to such recipient and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the applicable Loan Party by a Lender, or by the Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error.

(d) As soon as reasonably practicable after any payment of Taxes by a Loan Party to a Governmental Authority pursuant to this Section 2.18, such Loan Party shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, if any, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.

(e)

(i) Any Lender that is entitled to an exemption from or reduction of withholding Tax under the law of the jurisdiction in which a Borrower is located, or any treaty to which such jurisdiction is a party, with respect to payments under any Loan Document shall deliver to such Borrower (with a copy to the Administrative Agent) such properly completed and executed documentation (including Canadian Forms NR301, NR302 or NR303, as applicable) as may reasonably be requested by such Borrower or the Administrative Agent, in either case to permit such payments to be made without such withholding tax or at a reduced rate. In addition, any Lender, if reasonably requested by the Borrower or the Administrative Agent, shall deliver such other documentation reasonably requested by the Borrower or the Administrative Agent as will enable the Borrower or the Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in Section 2.18(e)(ii)(A), (ii)(B) and (ii)(C) below) shall be required if in the reasonable judgment of such Lender such compliance would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender as determined in good faith by such Lender. Each Lender agrees that if any documentation it previously delivered pursuant to this Section 2.18(e) expires or becomes obsolete or inaccurate in any respect, it shall promptly update such documentation or promptly notify the applicable Borrower and the Administrative Agent in writing of its legal ineligibility to do so.

(ii) Without limiting the foregoing:

(A) Each Lender that is a United States person (as defined in Section 7701(a)(30) of the Code) shall deliver to the U.S. Borrower and the Administrative Agent on or before the date on which it becomes a party to this Agreement two properly completed and duly signed original copies of Internal Revenue Service Form W-9 (or any successor form) certifying that such Lender is exempt from U.S. federal backup withholding tax.

(B) Each Lender that is not a United States person (as defined in Section 7701(a)(30) of the Code) shall deliver to the U.S. Borrower and the Administrative Agent on or before the date on which it becomes a party to this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), two properly completed and duly signed original copies of the applicable Internal Revenue Service Form W-8 certifying as to such Lender’s non-U.S. status.

(C) If a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the U.S. Borrower and the

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Administrative Agent, at the times or times prescribed by law and at such time or times reasonably requested by the U.S. Borrower or the Administrative Agent, such properly completed and executed documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the U.S. Borrower as may be necessary for the U.S. Borrower and the Administrative Agent to comply with their obligations under FATCA, to determine whether such Lender has or has not complied with such Lender’s obligation under FATCA and to determine the amount, if any, to deduct and withhold from such payment. Solely for purposes of this clause (C), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

(iii) Notwithstanding anything to the contrary in this Section 2.18(e), no Lender shall be required to deliver any documentation pursuant to this Section 2.18(e) that such Lender is not legally eligible to deliver.

(iv) Each Lender hereby authorizes the Administrative Agent to deliver to the Loan Parties and to any successor Administrative Agent any documentation provided by such Lender pursuant to this Section 2.18(e).

(f) If any party, in good faith and in its sole discretion, that it has received a refund of any Indemnified Taxes as to which it has been indemnified by a Loan Party or with respect to which such Loan Party has paid additional amounts pursuant to this Section 2.18, it shall promptly pay over such refund to such Loan Party (but only to the extent of indemnity payments made, or additional amounts paid, by such Loan Party under this Section 2.18 with respect to the Indemnified Taxes giving rise to such refund), net of all reasonable out-of-pocket expenses of such indemnified party (including any Taxes imposed with respect to such refund) and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund); provided that such Loan Party, upon the request of such indemnified party, agrees to repay as soon as reasonably practicable the amount paid over to such Loan Party (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to such indemnified party in the event such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this Section 2.18(f), in no event will any indemnified party be required to pay any amount to any Loan Party pursuant to this Section 2.18(f) the payment of which would place such indemnified party in a less favorable net after-Tax position than it would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This Section 2.18(f) shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes which it deems confidential) to the Loan Parties or any other Person.

(g) Solely for purposes of FATCA, from and after the Amendment No. 2 Effective Date, the Borrowers and the Administrative Agent shall treat (and the Lenders hereby authorize the Administrative Agent to treat) this Agreement and the Loans as not qualifying as “Grandfathered obligations” within the meaning of Treasury Regulation Section 1.1471-2(b)(2)(i).

(h) For the avoidance of doubt, the term “Lender,” for purposes of this Section 2.18, shall include any Swingline Lender and any L/C Issuer.

Section 2.19 Payments Generally; Pro Rata Treatment; Sharing of Payments.

(a) Payments by the Canadian Borrower. Except as otherwise provided in this Agreement, each payment of principal of and interest on Loans, discount and BA Acceptance Fees in respect of any BA Loan, L/C Obligations and fees hereunder (other than fees payable directly to the L/C Issuers) shall be paid not later than 2:00 P.M. on the date when due, in Federal or other funds immediately available to the Administrative Agent at the account designated by it by notice to the Canadian Borrower. Each such payment shall be made without condition or deduction for any counterclaim, defense, recoupment or setoff and irrespective of any claim or defense to payment which might in the absence of this provision be asserted by the Canadian Borrower or any Affiliate against the any Agent or any Lender. All prepayments and repayments of Loans made pursuant to this Section 2.19(a) shall be made in the currency in which such Loan is denominated. Payments received after 2:00 P.M. shall be deemed to have been

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received on the next Business Day, and any applicable interest or fee shall continue to accrue. Except for payments and other amounts received by the Administrative Agent and applied in accordance with the provisions of paragraph (c) below or required by a provision hereof to be applied in a specified manner, the Canadian Borrower shall, at the time it makes any payments under this Agreement, specify to the Administrative Agent the Loan, Letters of Credit, fees or other amounts payable by the Canadian Borrower hereunder to which such payment is to be applied (and if it fails to specify or if such application would be inconsistent with the terms hereof, the Administrative Agent shall, subject to paragraph (c) below, to Section 2.11, to Section 2.12 and to Section 2.19(e), distribute such payment to the Lenders in such manner as the Administrative Agent may deem reasonably appropriate). The Administrative Agent may in its sole discretion, distribute such payments to the applicable Lenders on the date of receipt thereof, if such payment is received prior to 2:00 P.M.; otherwise the Administrative Agent may, in its sole discretion, distribute such payment to the applicable Lenders on the date of receipt thereof or on the immediately succeeding Business Day. Whenever any payment hereunder shall be due on a day which is not a Business Day, the date for payment thereof shall be extended to the next succeeding Business Day unless (in the case of ~~Eurodollar~~Term Benchmark Loans) such Business Day falls in another calendar month, in which case the date for payment thereof shall be the next preceding Business Day. If the date for any payment of principal is extended by operation of Law or otherwise, interest thereon shall be payable for such extended time. Other than with respect to Swingline Loans, the Canadian Borrower hereby authorizes and directs the Administrative Agent to debit any account maintained by the Canadian Borrower with the Administrative Agent to pay when due any amounts required to be paid from time to time under this Agreement.

(b) Distributions by the Administrative Agent. Unless the Administrative Agent shall have received notice (which may be by telephone if promptly confirmed in writing) from the Canadian Borrower prior to the date on which any payment is due to the Lenders hereunder that the Canadian Borrower will not make such payment in full, the Administrative Agent may assume that the Canadian Borrower has made such payment in full to the Administrative Agent on such date, and the Administrative Agent may, in reliance upon such assumption, cause to be distributed to each Lender on such due date an amount equal to the amount then due such Lender. If and to the extent that the Canadian Borrower shall not have so made such payment, each Lender shall repay to the Administrative Agent forthwith on demand such amount distributed to such Lender together with interest thereon, for each day from the date such amount is distributed to such Lender until the date such Lender repays such amount to the Administrative Agent, at the Federal Funds Effective Rate.

(c) Pro Rata Treatment of Loans. Except as otherwise set forth in this Agreement, each Borrowing, each payment or prepayment of principal of or interest on any Loan, each payment of fees (other than the L/C Issuer Fees retained by a L/C Issuer for its own account and the administrative fees retained by the Agents for their own account), each reduction of the Revolving R-3 Committed Amount and each conversion or continuation of any Loan, shall be allocated pro rata among the relevant Lenders in accordance with the respective Revolving R-3 Commitment Percentages, or with respect to Term Loans, according to the respective outstanding principal amounts of the applicable Term Loans then held by the applicable Term Loan Lenders, as applicable, of such Lenders (or, if the Commitments of such Lenders have expired or been terminated, in accordance with the respective principal amounts of the outstanding Loans of the applicable Class and Participation Interests of such Lenders); provided that, in the event any amount paid to any Lender pursuant to this subsection (c) is rescinded or must otherwise be returned by the Administrative Agent, each Lender shall, upon the request of the Administrative Agent, repay to the Administrative Agent the amount so paid to such Lender, with interest for the period commencing on the date such payment is returned by the Administrative Agent until the date the Administrative Agent receives such repayment at a rate per annum equal to, during the period to but excluding the date two Business Days after such request, the Federal Funds Effective Rate, and thereafter, the Alternate Base Rate plus 2.00% per annum.

(d) Pro Rata Treatment of Letters of Credit. Except as otherwise set forth in this Agreement, each payment of L/C Obligations shall be allocated to each Revolving R-3 Facility Lender pro rata in accordance with its Revolving R-3 Commitment Percentage; provided that, if any Revolving R-3 Facility Lender shall have failed to pay its applicable pro rata share of any L/C Disbursement as required under Section 2.05(e)(iv) or (vi), then any amount to which such Revolving R-3 Facility Lender would otherwise be entitled pursuant to this subsection (e) shall instead be payable to the L/C Issuer.

(e) Sharing of Payments. The Lenders agree among themselves that, except as otherwise set forth in this Agreement, if any Lender shall obtain payment in respect of any Loan, unreimbursed L/C Disbursements or any

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other obligation owing to such Lender under this Agreement through the exercise of a right of setoff, banker’s lien or counterclaim, or pursuant to a secured claim under Section 506 of the U.S. Bankruptcy Code or other security or interest arising from, or in lieu of, such secured claim, received by such Lender under any applicable Debtor Relief Laws or otherwise, or by any other means, in excess of the share of such payment to which it was entitled as provided for in this Agreement, such Lender shall promptly pay in cash or purchase from the other Lenders a participation in such Loans, unreimbursed L/C Disbursements and other obligations in such amounts, and make such other adjustments from time to time, as shall be equitable to the end that all Lenders entitled to receive such amounts share such payment in accordance with their respective ratable shares as provided for in this Agreement; provided that nothing in this subsection (e) shall impair the right of any Lender to exercise any right of set-off or counterclaim it may have for payment of indebtedness of the Borrowers other than its indebtedness hereunder. The Lenders further agree among themselves that if payment to a Lender obtained by such Lender through the exercise of a right of setoff, banker’s lien, counterclaim or other event as aforesaid shall be rescinded or must otherwise be restored, each Lender which shall have shared the benefit of such payment shall, by payment in cash or a repurchase of a participation theretofore sold, return its share of that benefit (together with its share of any accrued interest payable with respect thereto) to each Lender whose payment shall have been rescinded or otherwise restored. The Canadian Borrower agrees that any Lender so purchasing such a participation may, to the fullest extent permitted by Law, exercise all rights of payment, including setoff, banker’s lien or counterclaim, with respect to such participation as fully as if such Lender were a holder of such Loan, L/C Obligation or other obligation in the amount of such participation. The Administrative Agent will keep records (which shall be conclusive and binding in the absence of manifest error) of participations purchased under this subsection (e) and will in each case notify the Lenders following any such purchases or repayments. Each Lender that purchases a participation pursuant to this Section shall from and after such purchase have the right to give all notices, requests, demands, directions and other communications under this Agreement with respect to the portion of the Loan, L/C Obligation or other obligation purchased to the same extent as though the purchasing Lender were the original owner of the obligations purchased. If under any applicable Debtor Relief Law, any Lender receives a secured claim in lieu of a setoff to which this subsection (e) applies, such Lender shall, to the extent practicable, exercise its rights in respect of such secured claim in a manner consistent with the rights of the Lenders under this subsection (e) to share in the benefits of any recovery on such secured claim.

Section 2.20 Mitigation Obligations; Replacement of Lenders.

(a) If any Lender requests compensation under Section 2.16, or if a Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.18, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or Affiliates, if, in the sole good faith judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.16 or 2.18, as applicable, in the future and (ii) would not subject such Lender to any material unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender in any material respect. Each Borrower hereby agrees to pay all reasonable and documented out-of-pocket costs and expenses incurred by any Lender in connection with any such designation or assignment.

(b) If any Lender requests compensation under Section 2.16, or if a Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 2.18, or is a Defaulting Lender, then such Borrower may, at its sole expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in Section 9.04), all its interests, rights and obligations under this Agreement to an assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that (i) such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and participations in L/C Disbursements and Swingline Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder, from the assignee (to the extent of such outstanding principal and accrued interest and fees) or such Borrower (in the case of all other amounts) and (ii) in the case of any such assignment resulting from a claim for compensation under Section 2.16 or payments required to be made pursuant to Section 2.18, such assignment will result in a reduction in such compensation or payments. Nothing in this Section 2.20 shall be deemed to prejudice any rights that any Borrower may have against any Lender that is a Defaulting Lender.

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(c) If any Lender (such Lender, a “Non-Consenting Lender”) has failed to consent to a proposed amendment, waiver, discharge or termination which pursuant to the terms of Section 9.08 requires the consent of all of the Lenders affected and with respect to which the Required Lenders shall have granted their consent, then provided no Event of Default then exists, the Canadian Borrower shall have the right (unless such Non-Consenting Lender grants such consent) to replace such Non-Consenting Lender by requiring such Non-Consenting Lender to assign its Loans, and its Commitments hereunder to one or more assignees reasonably acceptable to the Administrative Agent; provided that (i) all Obligations of Borrowers owing to such Non-Consenting Lender being replaced shall be paid in full to such Non-Consenting Lender concurrently with such assignment, and (ii) the replacement Lender shall purchase the foregoing by paying to such Non-Consenting Lender a price equal to the principal amount thereof plus accrued and unpaid interest thereon. In connection with any such assignment the Canadian Borrower, Administrative Agent, such Non-Consenting Lender and the replacement Lender shall otherwise comply with Section 9.04; provided that, notwithstanding anything herein to the contrary (including in Section 9.04), any such Non-Consenting Lender shall automatically be deemed to have assigned its Loans pursuant to the terms of an Assignment and Acceptance, and accordingly no other action by such Non-Consenting Lender shall be required in connection therewith.

(d) Notwithstanding anything herein to the contrary, each party hereto agrees that any assignment pursuant to the terms of this Section 2.20 may be effected pursuant to an Assignment and Acceptance executed by the Canadian Borrower, the Administrative Agent and the assignee and that the Lender making such assignment need not be a party thereto.

Section 2.21 Incremental Facilities.

(a) The Canadian Borrower may at any time or from time to time after the Amendment No. 6 Effective Date, by written notice delivered to the Administrative Agent request (i) one or more additional Classes of term loans or additional term loans of the same Class of any existing Class of term loans denominated in Dollars or Canadian Dollars (the “Incremental Term Loans”) and (ii) one or more increases in the amount of the Revolving R-3 Facility Commitments of any Class (each such increase, an “Incremental Revolving Credit Commitment Increase,” and together with the Incremental Term Loans the “Incremental Facilities” and the commitments in respect thereof are referred to as the “Incremental Commitments”); provided that, subject to Section 1.06, at the time that any such Incremental Term Loan or Incremental Revolving Credit Commitment Increase is made or effected (and after giving pro forma effect thereto and to any Specified Transaction to be consummated in connection therewith), except as set forth in the proviso to clause (b) below, no Event of Default (or, in the case of the incurrence or provision of any Incremental Facility in connection with an acquisition, no Event of Default under Sections 7.01(b), (c), (h) or (i)) shall have occurred and be continuing.

(b) Each tranche of Incremental Term Loans and each Incremental Revolving Credit Commitment Increase shall be in an aggregate principal amount that is not less than $5,000,000 (or CAD5,000,000 if denominated in Canadian Dollars) (it being understood that such amount may be less than $5,000,000 (or CAD5,000,000 if denominated in Canadian Dollars) if such amount represents all remaining availability under the limit set forth below) (and in minimum increments of $1,000,000 (or CAD1,000,000 if denominated in Canadian Dollars) in excess thereof), and, subject to the proviso at the end of this Section 2.21(b), the aggregate amount of the Incremental Term Loans and Incremental Revolving Credit Commitment Increases (after giving pro forma effect thereto and the use of the proceeds thereof) incurred pursuant to this Section 2.21(b), together with the aggregate principal amount of Permitted Additional Debt incurred pursuant to clause (a) of the definition of Permitted Debt, shall not exceed, as of the date of incurrence of such Indebtedness or commitments, an aggregate principal amount equal to the sum of (x) $200,000,000, plus (y) the aggregate amount of all voluntary prepayments of (1) Term B-5 Loans outstanding on the Amendment No. 6 Effective Date, (2) Revolving R-3 Facility Loans (to the extent accompanied by a permanent reduction in Revolving R-3 Facility Commitments) and (3) any Incremental Term Loan (other than Incremental Term Loans in respect of Replacement Term Loans and Extended Term Loans), plus (z) an additional amount, such that, subject to Section 1.06, after giving pro forma effect to such incurrence (and after giving pro forma effect to any Specified Transaction to be consummated in connection therewith and assuming that all Incremental Revolving Credit Commitment Increases then outstanding were fully drawn), the Canadian Borrower would be in compliance with a First Lien Leverage Ratio as of the last day of the Test Period most recently ended on or prior to the incurrence of any such Incremental Facility, calculated on a pro forma basis, as if such incurrence (and transactions) had occurred on the first day of such Test Period, that is no greater than 3.50:1.00 (clauses (x), (y) and (z),

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collectively, the “Incremental Limit”); provided that (i) Incremental Term Loans may be incurred without regard to the Incremental Limit, without regard to whether an Event of Default has occurred and is continuing and, without regard to the minimums set forth in the first part of this Section 2.21(b), to the extent that the Net Cash Proceeds from such Incremental Term Loans on the date of incurrence of such Incremental Term Loans (or substantially concurrently therewith) are used to either (x) prepay Term Loans and related amounts in accordance with the procedures set forth in Section 2.12 or (y) permanently reduce or replace the Revolving R-3 Facility Commitments or Extended Revolving Credit Commitments in accordance with the procedures set forth in Section 2.09 (and any such Incremental Term Loans shall be deemed to have been incurred pursuant to this proviso) and (ii) on or prior to the date that is 60 days after the occurrence of a Permitted Change of Control, Incremental Revolving Credit Commitment Increases may be incurred without regard to the Incremental Limit, without regard to whether an Event of Default has occurred and is continuing and without regard to the minimums set forth in the first part of this Section 2.21(b) in an aggregate amount pursuant to this clause (ii) equal to the aggregate amount of Permitted Change of Control Terminated Commitments that were terminated in connection with such Permitted Change of Control.

(c)

(i) The Incremental Term Loans (A) shall rank equal in right of payment and security with the Term B-5 Loans, shall be secured only by all or a portion of the Collateral securing the Secured Obligations and, if guaranteed, shall only be guaranteed by the Loan Parties, (B) shall not mature earlier than the Term B-5 Loan Maturity Date, (C) shall not have a shorter Weighted Average Life to Maturity than the remaining Term B-5 Loans (provided that up to $200,000,000 of Incremental Term Loans may have a shorter Weighted Average Life to Maturity than the then-outstanding Term B-5 Loans; provided, further, that any Incremental Term Loans incurred solely for the purpose of funding export-import bank financings (“Export Financing”) and any customary “high yield” bridge facilities (so long as the long-term Indebtedness into which any such customary “high yield” bridge facility is to be converted or exchanged satisfies the requirements of this clause (C)) (as determined by the Canadian Borrower in good faith) may have a shorter Weighted Average Life to Maturity than the then outstanding Term B-5 Loans), (D) shall have a maturity date (other than with respect to the Incremental Term Loans described in the provisos to clause (C)), an amortization schedule (subject to clause (C)), and interest rates (including through fixed interest rates), interest margins, rate floors, upfront fees, funding discounts, original issue discounts and prepayment terms and premiums for the Incremental Term Loans as determined by the Canadian Borrower and the lenders of the Incremental Term Loans; provided that in the event that the Effective Yield for any Incremental Term Loans incurred within six months after the Amendment No. 6 Effective Date (other than Incremental Term Loans incurred pursuant to the proviso of Section 2.21(b)), is greater than the Effective Yield for the Term B-5 Loans by more than 0.50%, then the Applicable Margins for the Term B-5 Loans shall be increased to the extent necessary so that the Effective Yield for the Term B-5 Loans are equal to the Effective Yield for the Incremental Term Loans minus 0.50%; provided, further, that, with respect to any Incremental Term Loans that do not bear interest at a rate determined by reference to the Adjusted LIBO Rate (as defined in this Agreement as in effect immediately prior to the Amendment No. 7 Effective Date), for purposes of calculating the applicable increase (if any) in the Applicable Margins for the Term B-5 Loans in the immediately preceding proviso, the Applicable Margin for such Incremental Term Loans shall be deemed to be the interest rate (calculated after giving pro forma effect to any increases required pursuant to the immediately succeeding proviso) of such Incremental Term Loans less the then applicable ~~Reference Rate~~Benchmark; and (E) may otherwise have terms and conditions different from those of the Term B-5 Loans; provided that (x) except with respect to matters contemplated by clauses (B), (C) and (D) above, any differences shall be reasonably satisfactory to the Administrative Agent (except for covenants and other provisions applicable only to the periods after the Final Maturity Date) and (y) the documentation governing any Incremental Term Loans may include any Previously Absent Financial Maintenance Covenant so long as the Administrative Agent shall have been given prompt written notice thereof and this Agreement is amended to include such Previously Absent Financial Maintenance Covenant for the benefit of each Facility.

(ii) The Incremental Revolving Credit Commitment Increase shall be treated the same as the Class of Revolving R-3 Facility Commitments being increased (including with respect to maturity date

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thereof) and shall be considered to be part of the Class of the Revolving R-3 Facility being increased (it being understood that, if required to consummate an Incremental Revolving Credit Commitment Increase, the interest rate margins, rate floors and undrawn commitment fees on the Class of Revolving R-3 Facility Commitments being increased may be increased and additional upfront or similar fees may be payable to the lenders participating in the Incremental Revolving Credit Commitment Increase (without any requirement to pay such fees to any existing Revolving R-3 Facility Lenders)).

(d) Each notice from the Canadian Borrower pursuant to this Section 2.21 shall be given in writing and shall set forth the requested amount and proposed terms of the relevant Incremental Term Loans or Incremental Revolving Credit Commitment Increases. Incremental Term Loans may be made, and Incremental Revolving Credit Commitment Increases may be provided, subject to the prior written consent of the Canadian Borrower (not to be unreasonably withheld or delayed), by any existing Lender (it being understood that no existing Lender with an Term B-5 Loan Commitment will have an obligation to make a portion of any Incremental Term Loan, no existing Lender with a Revolving R-3 Facility Commitment will have any obligation to provide a portion of any Incremental Revolving Credit Commitment Increase) or by any other bank, financial institution, other institutional lender or other investor (any such other bank, financial institution or other investor being called an “Additional Lender”); provided that the Administrative Agent shall have consented (not to be unreasonably withheld or delayed) to such Lender’s or Additional Lender’s making such Incremental Term Loans or providing such Incremental Revolving Credit Commitment Increases if such consent would be required under Section 9.04(b) for an assignment of Loans or Commitments, as applicable, to such Lender or Additional Lender; provided, further, that, solely with respect to any Incremental Revolving Credit Commitment Increases, the Swingline Lender and the L/C Issuer shall have consented (not to be unreasonably withheld or delayed) to such Lender’s or Additional Lender’s providing such Incremental Revolving Credit Commitment Increases if such consent would be required under Section 9.04(b) for an assignment of Loans or Commitments, as applicable, to such Lender or Additional Lender.

(e) Commitments in respect of Incremental Term Loans and Incremental Revolving Credit Commitment Increases shall become Commitments (or in the case of an Incremental Revolving Credit Commitment Increase to be provided by an existing Lender with a Revolving R-3 Facility Commitment, an increase in such Lender’s applicable Revolving R-3 Facility Commitment) under this Agreement pursuant to an amendment (an “Incremental Agreement”) to this Agreement and, as appropriate, the other Loan Documents, executed by the Canadian Borrower, each Lender agreeing to provide such Commitment, if any, each Additional Lender, if any, and the Administrative Agent. The Incremental Agreement may, subject to Section 2.21(c), without the consent of any other Lenders, effect such amendments to this Agreement and the other Loan Documents as may be necessary, in the reasonable opinion of the Administrative Agent and the Canadian Borrower, to effect the provisions of this Section (including (i) in connection with an Incremental Revolving Credit Commitment Increase, to reallocate Revolving R-3 Facility Credit Exposure on a pro rata basis among the relevant Revolving R-3 Facility Lenders, (ii) to increase the Effective Yield of the applicable Class of Term Loans to the extent necessary in order to ensure that any applicable Class of Incremental Term Loans are “fungible” with such existing Class of Term Loans and/or (iii) to add or extend “soft call” or add or extend any other “call protection”, in either case for the benefit of any existing Class of Term Loans. The effectiveness of any Incremental Agreement and the occurrence of any Credit Event pursuant to such Incremental Agreement shall be subject to the satisfaction of such conditions as the parties thereto shall agree. The Canadian Borrower will use the proceeds of the Incremental Term Loans and Incremental Revolving Credit Commitment Increases for any purpose not prohibited by this Agreement; provided, however, that the proceeds of any Incremental Term Loans incurred as described in the proviso to Section 2.21(b), shall be used in accordance with the terms thereof.

(f)

(i) No Lender shall be obligated to provide any Incremental Term Loans or Incremental Revolving Credit Commitment Increases unless it so agrees, and the Canadian Borrower shall not be obligated to offer any existing Lender the opportunity to provide any Incremental Term Loans or Incremental Revolving Credit Commitment Increases.

(ii) Upon each increase in the Revolving R-3 Facility Commitments of any Class pursuant to this Section, each Lender with a Revolving R-3 Facility Commitment of such Class immediately prior to

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such increase will automatically and without further act be deemed to have assigned to each Lender providing a portion of the Incremental Revolving Credit Commitment Increase (each, an “Incremental Revolving Credit Commitment Increase Lender”) in respect of such increase, and each such Incremental Revolving Credit Commitment Increase Lender will automatically and without further act be deemed to have assumed, a portion of such Lender’s participations hereunder in outstanding Letters of Credit and Swingline Loans such that, after giving pro forma effect to each such deemed assignment and assumption of participations, the percentage of the aggregate outstanding (A) participations hereunder in Letters of Credit and (B) participations hereunder in Swingline Loans held by each Lender with a Revolving R-3 Facility Commitment of such Class (including each such Incremental Revolving Credit Commitment Increase Lender) will equal the percentage of the aggregate Revolving R-3 Facility Commitments of such Class of all Lenders represented by such Lender’s Revolving R-3 Facility Commitment of such Class. If, on the date of such increase, there are any Revolving R-3 Facility Loans of such Class outstanding, such Revolving R-3 Facility Loans shall on or prior to the effectiveness of such Incremental Revolving Credit Commitment Increase be prepaid from the proceeds of additional Revolving R-3 Facility Loans made hereunder (reflecting such increase in Revolving R-3 Facility Commitments of such Class), which prepayment shall be accompanied by accrued interest on the Revolving R-3 Facility Loans of such Class being prepaid and any costs incurred by any Lender in accordance with Section 2.17. The Administrative Agent and the Lenders hereby agree that the minimum borrowing, pro rata borrowing and pro rata payment requirements contained elsewhere in this Agreement shall not apply to the transactions effected pursuant to the immediately preceding sentence.

(g) This Section 2.21 shall supersede any provisions in Section 2.19 or 9.08 to the contrary. For the avoidance of doubt, any provisions of this Section 2.21 may be amended with the consent of the Required Lenders; provided no such amendment shall require any Lender to provide any Incremental Commitment without such Lender’s consent.

Section 2.22 Illegality. If any Lender reasonably determines that any change in law has made it unlawful, or that any Governmental Authority has asserted after the Amendment No. 6 Effective Date that it is unlawful, for any Lender or its Applicable Lending Office to make or maintain any ~~Eurodollar~~Term Benchmark Loans or BA Loans, then, on notice thereof by such Lender to the applicable Borrower through the Administrative Agent, any obligations of such Lender to make or continue ~~Eurodollar~~Term Benchmark Loans or BA Loans or to convert ABR Borrowings to ~~Eurodollar~~Term Benchmark Borrowings (if such ABR Borrowings are denominated in Dollars) or BA Loans (if such ABR Borrowings are denominated in Canadian Dollars), as applicable, shall be suspended until such Lender notifies the Administrative Agent and the applicable Borrower that the circumstances giving rise to such determination no longer exist. Upon receipt of such notice, the applicable Borrower shall upon demand from such Lender (with a copy to the Administrative Agent), either (i) for Loans denominated in Canadian Dollars (A) convert all BA Loans of such Lender to ABR Borrowings denominated in Canadian Dollars, either on the last day of the Interest Period therefor, if such Lender may lawfully maintain such BA Borrowings to such day, or immediately, prepay such BA Borrowing in the manner provided for in Section 2.06(i), if such Lender may not lawfully continue to maintain such Loans as BA Borrowing, or (ii) for Loans denominated in Dollars, convert all ~~Eurodollar~~Term Benchmark Borrowings of such Lender to ABR Borrowings, either on the last day of the Interest Period therefor, if such Lender may lawfully continue to maintain such ~~Eurodollar~~Term Benchmark Borrowings to such day, or immediately, if such Lender may not lawfully continue to maintain such Loans. Upon any such prepayment or conversion, such Borrower shall also pay accrued interest on the amount so prepaid or converted.

Section 2.23 Defaulting Lenders.

(a) Notwithstanding any provision of this Agreement to the contrary, if any Lender becomes a Defaulting Lender, then the following provisions shall apply for so long as such Lender is a Defaulting Lender:

(i) Revolving R-3 Facility Commitment Fees shall cease to accrue on the Commitment of such Defaulting Lender pursuant to Section 2.13(a);

(ii) the Commitment of and the Revolving R-3 Facility Credit Exposure of such Defaulting Lender shall not be included in determining whether all Lenders or the Required Lenders or any other

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requisite Lenders have taken or may take any action hereunder (including any consent to any amendment or waiver pursuant to Section 9.08); provided that (A) any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender which affects such Defaulting Lender differently than other affected Lenders shall require the consent of such Defaulting Lender and (B) the Commitment of any Defaulting Lender may not be increased or extended without the consent of such Lender;

(iii) if any Swingline Exposure or Letter of Credit Exposure exists at the time a Lender becomes a Defaulting Lender, then (v) all or any part of such Letter of Credit Exposure of such Defaulting Lender and such Swingline Exposure of such Defaulting Lender will, subject to the limitation in the first proviso below, automatically be reallocated (effective on the day such Lender becomes a Defaulting Lender) among the Non-Defaulting Lenders pro rata in accordance with their respective Revolving R-3 Commitment Percentages; provided that (A) each Non-Defaulting Lender’s Letter of Credit Exposure may not in any event exceed the Revolving R-3 Facility Commitment of such Non-Defaulting Lender as in effect at the time of such reallocation and (B) neither such reallocation nor any payment by a Non-Defaulting Lender pursuant thereto will constitute a waiver or release of any claim any Borrower, the Administrative Agent, the L/C Issuer, the Swingline Lender or any other Lender may have against such Defaulting Lender or cause such Defaulting Lender to be a Non-Defaulting Lender, (w) to the extent that all or any portion of the Defaulting Lender’s Letter of Credit Exposure and Swingline Exposure cannot, or can only partially, be so reallocated to Non-Defaulting Lenders, whether by reason of the first proviso in Section 2.23(a)(iii)(v) above or otherwise, the Canadian Borrower shall within two Business Days for Term Loans, and for Revolving R-3 Facility Loans that are ~~Eurodollar~~Term Benchmark Loans, three Business Days, following notice by the Administrative Agent (I) first, prepay such Swingline Exposure (after giving effect to any partial reallocation pursuant to clause (i) above) and (II) second, Cash Collateralize such Defaulting Lender’s Letter of Credit Exposure (after giving effect to any partial reallocation pursuant to clause (i) above), in accordance with the procedures set forth in Section 2.05 for so long as such Letter of Credit Exposure is outstanding, (x) if the Canadian Borrower Cash Collateralizes any portion of such Defaulting Lender’s Letter of Credit Exposure pursuant to the requirements of this Section 2.23(a)(iii), the Borrowers shall not be required to pay any fees to such Defaulting Lender pursuant to Section 2.13(b) with respect to such Defaulting Lender’s Letter of Credit Exposure during the period such Defaulting Lender’s Letter of Credit Exposure is cash collateralized, (y) if the Letter of Credit Exposure of the Non-Defaulting Lenders is reallocated pursuant to the requirements of this Section 2.23(a)(iii), then the fees payable to the Lenders pursuant to Sections 2.13(a) and (b) shall be adjusted to give effect to such reallocation and the Borrowers shall not be required to pay any fees to the Defaulting Lender pursuant to Section 2.13(b) with respect to such Defaulting Lender’s Letter of Credit Exposure during the period that such Defaulting Lender’s Letter of Credit Exposure is reallocated, or (z) if any Defaulting Lender’s Letter of Credit Exposure is neither cash collateralized nor reallocated pursuant to the requirements of this Section 2.23(a)(iii), then, without prejudice to any rights or remedies of the L/C Issuer or any Lender hereunder, all fees payable under Section 2.13(b) with respect to such Defaulting Lender’s Letter of Credit Exposure shall be payable to the L/C Issuer until such Letter of Credit Exposure is cash collateralized and/or reallocated;

(iv) any payment of principal, interest, fees or other amounts received by the Administrative Agent for the account of that Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Article VII or otherwise, and including any amounts made available to the Administrative Agent by that Defaulting Lender pursuant to Section 9.06), shall be applied at such time or times as may be determined by the Administrative Agent as follows: first, to the payment of any amounts owing by that Defaulting Lender to the Administrative Agent hereunder; second, in the case of a Revolving R-3 Facility Lender, to the payment on a pro rata basis of any amounts owing by that Defaulting Lender to each L/C Issuer and the Swingline Lender hereunder; third, as the Canadian Borrower may request (so long as no Default or Event of Default exists), to the funding of any Loan in respect of which that Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; fourth, in the case of a Revolving R-3 Facility Lender, if so determined by the Administrative Agent and the Canadian Borrower, to be held in a non-interest bearing deposit account and released in order (x) to satisfy obligations of that Defaulting Lender to fund Loans under this Agreement and (y) if such Defaulting Lender is a Revolving R-3 Facility Lender, to Cash Collateralize its pro rata share of any L/C Issuer’s future Letter of Credit Exposure with respect to such Defaulting Lender for future Letters of Credit issued under this Agreement; fifth, to the payment of any amounts owing to the Lenders, the L/C Issuers or the Swingline

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Lender as a result of any judgment of a court of competent jurisdiction obtained by any Lender, such L/C Issuer or the Swingline Lender against that Defaulting Lender as a result of that Defaulting Lender’s breach of its obligations under this Agreement; sixth, so long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrowers as a result of any judgment of a court of competent jurisdiction obtained by the Borrowers against that Defaulting Lender as a result of that Defaulting Lender’s breach of its obligations under this Agreement; and seventh, to that Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if such payment is a payment of the principal amount of any Loans or any L/C Disbursement that has not been reimbursed in accordance with Section 2.05 (any such L/C Disbursement, an “Unpaid Drawing”), such payment shall be applied solely to pay the relevant Loans of, and Unpaid Drawings owed to, the relevant non-Defaulting Lenders on a pro rata basis prior to being applied in the manner set forth in this Section 2.23(a). Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to Cash Collateralize pursuant to Section 2.05 shall be deemed paid to and redirected by that Defaulting Lender, and each Lender irrevocably consents hereto;

(v) the L/C Issuer will not be required to issue any new Letter of Credit or amend any outstanding Letter of Credit to increase the face amount thereof, alter the drawing terms thereunder or extend the expiry date thereof, unless the L/C Issuer is reasonably satisfied that any exposure that would result from the exposure to such Defaulting Lender is eliminated or fully covered by the Revolving R-3 Facility Commitments of the Non-Defaulting Lenders or by being cash collateralized or a combination thereof in accordance with the requirements of Section 2.23(a)(iii) above or otherwise in a manner reasonably satisfactory to the L/C Issuer; and

(vi) the Swingline Lender will not be required to fund any Swingline Loans unless the Swingline Lender is reasonably satisfied that any exposure that would result from the exposure to such Defaulting Lender is eliminated or fully covered by the Revolving R-3 Facility Commitments of the Non-Defaulting Lenders or a combination thereof in accordance with the requirements of Section 2.23(a)(iii) above.

(b) If the Canadian Borrower, the Administrative Agent, the Swingline Lender and the L/C Issuer agree in writing in their discretion that a Lender that is a Defaulting Lender should no longer be deemed to be a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon, as of the effective date specified in such notice and subject to any conditions set forth therein, such Lender will cease to be a Defaulting Lender and will be a Non-Defaulting Lender and any applicable cash collateral shall be promptly returned to the Canadian Borrower and any Letter of Credit Exposure and Swingline Exposure of such Lender reallocated pursuant to the requirements of Section 2.23(a)(iii) above shall be reallocated back to such Lender; provided that, except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Non-Defaulting Lender will constitute a waiver or release of any claim of any party hereunder arising from such Lender’s having been a Defaulting Lender.

Section 2.24 Amendments Effecting a Maturity Extension. In addition, notwithstanding any other provision of this Agreement to the contrary:

(a) The Canadian Borrower may at any time and from time to time request that all or a portion of each Term Loan of any Class (an “Existing Term Loan Class”) be converted or exchanged to extend the scheduled final maturity date(s) of any payment of principal with respect to all or a portion of any principal amount of such Term Loans (any such Term Loans which have been so extended, “Extended Term Loans”) and to provide for other terms consistent with this Section 2.24. Prior to entering into any Extension Agreement with respect to any Extended Term Loans, the Canadian Borrower shall provide written notice to the Administrative Agent (who shall provide a copy of such notice to each of the Lenders of the applicable Existing Term Loan Class, with such request offered equally to all such Lenders of such Existing Term Loan Class) (a “Term Loan Extension Request”) setting forth the proposed terms of the Extended Term Loans to be established, which terms shall be similar to the Term Loans of the Existing Term Loan Class from which they are to be extended except that (w) the scheduled final maturity date shall be extended and all or any of the scheduled amortization payments of all or a portion of any principal amount of such Extended Term Loans may be delayed to later dates than the scheduled amortization of principal of the Term Loans

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of such Existing Term Loan Class (with any such delay resulting in a corresponding adjustment to the scheduled amortization payments reflected in Section 2.11 or in the Extension Agreement or the Incremental Agreement, as the case may be, with respect to the Existing Term Loan Class of Term Loans from which such Extended Term Loans were extended, in each case as more particularly set forth in Section 2.24(d) below), (x)(A) the interest rates (including through fixed interest rates), interest margins, rate floors, upfront fees, funding discounts, original issue discounts and prepayment terms and premiums with respect to the Extended Term Loans may be different than those for the Term Loans of such Existing Term Loan Class and/or (B) additional fees and/or premiums may be payable to the Lenders providing such Extended Term Loans in addition to any of the items contemplated by the preceding clause (A), in each case, to the extent provided in the applicable Extension Agreement, (y) subject to the provisions set forth in Sections 2.11 and 2.12, the Extended Term Loans may have optional prepayment terms (including call protection and prepayment terms and premiums) and mandatory prepayment terms as may be agreed between the Canadian Borrower and the Lenders thereof and (z) the Extension Agreement may provide for other covenants and terms that apply to any period after the Final Maturity Date. No Lender shall have any obligation to agree to have any of its Term Loans of any Existing Term Loan Class converted into Extended Term Loans pursuant to any Term Loan Extension Request. Any Extended Term Loans of any Extension Series shall constitute a separate Class of Term Loans from the Existing Term Loan Class of Term Loans from which they were extended.

(b) The Canadian Borrower may at any time and from time to time request that all or a portion of the Revolving R-3 Facility Commitments of any Class and/or the Extended Revolving Credit Commitments of any Class (and, in each case, including any previously extended Revolving R-3 Facility Commitments), existing at the time of such request (each, an “Existing Revolving Credit Commitment” and any related revolving credit loans under any such facility, “Existing Revolving Credit Loans”; each Existing Revolving Credit Commitment and related Existing Revolving Credit Loans together being referred to as an “Existing Revolving Credit Class”) be converted or exchanged to extend the termination date thereof and the scheduled maturity date(s) of any payment of principal with respect to all or a portion of any principal amount of Existing Revolving Credit Loans related to such Existing Revolving Credit Commitments (any such Existing Revolving Credit Commitments which have been so extended, “Extended Revolving Credit Commitments” and any related revolving credit loans, “Extended Revolving Credit Loans”) and to provide for other terms consistent with this Section 2.24. Prior to entering into any Extension Agreement with respect to any Extended Revolving Credit Commitments, the Canadian Borrower shall provide a notice to the Administrative Agent (who shall provide a copy of such notice to each of the Lenders of the applicable Class of Existing Revolving Credit Commitments, with such request offered equally to all Lenders of such Class) (a “Revolving Credit Extension Request”) setting forth the proposed terms of the Extended Revolving Credit Commitments to be established thereunder, which terms shall be similar to those applicable to the Existing Revolving Credit Commitments from which they are to be extended (the “Specified Existing Revolving Credit Commitment Class”) except that (w) all or any of the final maturity dates of such Extended Revolving Credit Commitments may be delayed to later dates than the final maturity dates of the Existing Revolving Credit Commitments of the Specified Existing Revolving Credit Commitment Class, (x)(A) the interest rates, interest margins, rate floors, upfront fees, funding discounts, original issue discounts and prepayment terms and premiums with respect to the Extended Revolving Credit Commitments may be different than those for the Existing Revolving Credit Commitments of the Specified Existing Revolving Credit Commitment Class and/or (B) additional fees and/or premiums may be payable to the Lenders providing such Extended Revolving Credit Commitments in addition to or in lieu of any of the items contemplated by the preceding clause (A) and (y)(1) the undrawn revolving credit commitment fee rate with respect to the Extended Revolving Credit Commitments may be different than those for the Specified Existing Revolving Credit Commitment Class and (2) the Extension Agreement may provide for other covenants and terms that apply to any period after the Final Maturity Date; provided that, notwithstanding anything to the contrary in this Section 2.24 or otherwise, (I) the borrowing and repayment (other than in connection with a permanent repayment and termination of commitments) of the Extended Revolving Credit Loans under any Extended Revolving Credit Commitments shall be made on a pro rata basis with any borrowings and repayments of the Existing Revolving Credit Loans of the Specified Existing Revolving Credit Commitment Class (the mechanics for which may be implemented through the applicable Extension Agreement and may include technical changes related to the borrowing and repayment procedures of the Specified Existing Revolving Credit Commitment Class), (II) assignments and participations of Extended Revolving Credit Commitments and Extended Revolving Credit Loans shall be governed by the assignment and participation provisions set forth in Section 9.04 and (III) subject to the applicable limitations set forth in Section 2.09, Section 2.11 and Section 2.12, permanent repayments of Extended Revolving Credit Loans (and corresponding permanent reduction in the related Extended Revolving Credit Commitments) shall be permitted as may be agreed between the Canadian Borrower and the Lenders thereof. No

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Lender shall have any obligation to agree to have any of its Revolving R-3 Facility Loans or Revolving R-3 Facility Commitments of any Existing Revolving Credit Class converted or exchanged into Extended Revolving Credit Loans or Extended Revolving Credit Commitments pursuant to any Extension Request. Any Extended Revolving Credit Commitments of any Extension Series shall constitute a separate Class of revolving credit commitments from Existing Revolving Credit Commitments of the Specified Existing Revolving Credit Commitment Class and from any other Existing Revolving Credit Commitments (together with any other Extended Revolving Credit Commitments so established on such date).

(c) The Canadian Borrower shall provide the applicable Extension Request to the Administrative Agent at least five (5) Business Days (or such shorter period as the Administrative Agent may determine in its reasonable discretion) prior to the date on which Lenders under the Existing Class are requested to respond, and shall agree to such procedures, if any, as may be established by, or acceptable to, the Administrative Agent, in each case acting reasonably, to accomplish the purpose of this Section 2.24. The Canadian Borrower may, at its election, specify as a condition to consummating any Extension Agreement that a minimum amount (to be determined and specified in the relevant Extension Request in the Canadian Borrower’s sole discretion and as may be waived by the Canadian Borrower) of Term Loans and/or Revolving R-3 Facility Commitments (as applicable) of any or all applicable Classes be tendered. Any Lender (an “Extending Lender”) wishing to have all or a portion of its Term Loans or Revolving R-3 Facility Commitments (or any earlier Extended Revolving Credit Commitments) of an Existing Class subject to such Extension Request converted or exchanged into Extended Loans/Commitments shall notify the Administrative Agent (an “Extension Election”) on or prior to the date specified in such Extension Request of the amount of its Term Loans and/or Revolving R-3 Facility Commitments (and/or any earlier Extended Revolving Credit Commitments) which it has elected to convert or exchange into Extended Loans/Commitments (subject to any minimum denomination requirements imposed by the Administrative Agent). In the event that the aggregate amount of Term Loans and Revolving R-3 Facility Commitments (and any earlier extended Extended Revolving Credit Commitments) subject to Extension Elections exceeds the amount of Extended Loans/Commitments requested pursuant to the Extension Request, Term Loans, Revolving R-3 Facility Commitments or earlier extended Extended Revolving Credit Commitments, as applicable, subject to Extension Elections shall be converted to or exchanged to Extended Loans/Commitments on a pro rata basis (subject to such rounding requirements as may be established by the Administrative Agent) based on the amount of Term Loans, Revolving R-3 Facility Commitments and earlier extended Extended Revolving Credit Commitments included in each such Extension Election or as may be otherwise agreed to in the applicable Extension Agreement. Notwithstanding the conversion of any Existing Revolving Credit Commitment into an Extended Revolving Credit Commitment, unless expressly agreed by the holders of each affected Existing Revolving Credit Commitment of the Specified Existing Revolving Credit Commitment Class, such Extended Revolving Credit Commitment shall not be treated more favorably than all Existing Revolving Credit Commitments of the Specified Existing Revolving Credit Commitment Class for purposes of the obligations of a Revolving R-3 Facility Lender in respect of Swingline Loans and Letters of Credit, except that the applicable Extension Amendment may provide that the Swingline Termination Date and/or the last day for issuing Letters of Credit may be extended and the related obligations to make Swingline Loans and issue Letters of Credit may be continued (pursuant to mechanics to be specified in the applicable Extension Amendment) so long as the Swingline Lenders and/or each L/C Issuer have consented to such extensions (it being understood that no consent of any other Lender shall be required in connection with any such extension).

(d) Extended Loans/Commitments shall be established pursuant to an amendment (an “Extension Agreement”) to this Agreement (which, except to the extent expressly contemplated by the penultimate sentence of this Section 2.24(d) and notwithstanding anything to the contrary set forth in Section 9.08, shall not require the consent of any Lender other than the Extending Lenders with respect to the Extended Loans/Commitments established thereby) executed by the Loan Parties, the Administrative Agent and the Extending Lenders. In addition to any terms and changes required or permitted by this Section 2.24(d), each Extension Agreement in respect of Extended Term Loans shall amend the scheduled amortization payments pursuant to Section 2.11(a) or the applicable Incremental Agreement or Extension Agreement with respect to the Existing Class of Term Loans from which the Extended Term Loans were exchanged to reduce each scheduled repayment amount for the Existing Class in the same proportion as the amount of Term Loans of the Existing Class is to be reduced pursuant to such Extension Agreement (it being understood that the amount of any repayment amount payable with respect to any individual Term Loan of such Existing Class that is not an Extended Term Loan shall not be reduced as a result thereof). In connection with any Extension Agreement, the Canadian Borrower shall deliver an opinion of counsel reasonably acceptable to the Administrative Agent and addressed to the Administrative Agent and the applicable

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Extending Lenders as to the enforceability of such Extension Agreement, this Agreement as amended thereby, and such of the other Loan Documents (if any) as may be amended thereby (in the case of such other Loan Documents as contemplated by the immediately preceding sentence) and covering customary matters.

(e) Notwithstanding anything to the contrary contained in this Agreement, (A) on any date on which any Existing Term Loan Class or Class of Existing Revolving Credit Commitments is converted or exchanged to extend the related scheduled maturity date(s) in accordance with paragraph (a) above (an “Extension Date”), (I) in the case of the existing Term Loans of each Extending Lender, the aggregate principal amount of such existing Term Loans shall be deemed reduced by an amount equal to the aggregate principal amount of Extended Term Loans so converted or exchanged by such Lender on such date, and the Extended Term Loans shall be established as a separate Class of Term Loans (together with any other Extended Term Loans so established on such date), and (II) in the case of the Existing Revolving Credit Commitments of each Extending Lender under any Specified Existing Revolving Credit Commitment Class, the aggregate principal amount of such Existing Revolving Credit Commitments shall be deemed reduced by an amount equal to the aggregate principal amount of Extended Revolving Credit Commitments so converted or exchanged by such Lender on such date (or by any greater amount as may be agreed by the Canadian Borrower and such Lender), and such Extended Revolving Credit Commitments shall be established as a separate Class of revolving credit commitments from the Specified Existing Revolving Credit Commitment Class and from any other Existing Revolving Credit Commitments (together with any other Extended Revolving Credit Commitments so established on such date) and (B) if, on any Extension Date, any Existing Revolving Credit Loans of any Extending Lender are outstanding under the Specified Existing Revolving Credit Commitment Class, such Existing Revolving Credit Loans (and any related participations) shall be deemed to be converted or exchanged to Extended Revolving Credit Loans (and related participations) of the applicable Class in the same proportion as such Extending Lender’s Specified Existing Revolving Credit Commitments to Extended Revolving Credit Commitments of such Class.

(f) In the event that the Administrative Agent determines in its sole discretion that the allocation of Extended Term Loans of a given Extension Series or the Extended Revolving Credit Commitments of a given Extension Series, in each case to a given Lender was incorrectly determined as a result of manifest administrative error in the receipt and processing of an Extension Election timely submitted by such Lender in accordance with the procedures set forth in the applicable Extension Agreement, then the Administrative Agent, the Canadian Borrower and such affected Lender may (and hereby are authorized to), in their sole discretion and without the consent of any other Lender, enter into an amendment to this Agreement and the other Loan Documents within 15 days following the effective date of such Extension Agreement, as the case may be, which shall (i) provide for the conversion or exchange and extension of Term Loans under the Existing Term Loan Class or Existing Revolving Credit Commitments (and related Revolving R-3 Facility Credit Exposure), as the case may be, in such amount as is required to cause such Lender to hold Extended Term Loans or Extended Revolving Credit Commitments (and related revolving credit exposure) of the applicable Extension Series into which such other Term Loans or commitments were initially converted or exchanged, as the case may be, in the amount such Lender would have held had such administrative error not occurred and had such Lender received the minimum allocation of the applicable Loans or Commitments to which it was entitled under the terms of such Extension Agreement, in the absence of such error, (ii) be subject to the satisfaction of such conditions as the Administrative Agent, the Canadian Borrower and such Lender may agree (including conditions of the type required to be satisfied for the effectiveness of an Extension Agreement described in Section 2.24(d)), and (iii) effect such other amendments of the type (with appropriate reference and nomenclature changes) described in the penultimate sentence of Section 2.24(d).

(g) No conversion or exchange of Loans or Commitments pursuant to any Extension Agreement in accordance with this Section 2.24 shall constitute a voluntary or mandatory payment or prepayment for purposes of this Agreement.

(h) This Section 2.24 shall supersede any provisions in Section 2.19 or 9.08 to the contrary. For the avoidance of doubt, any of the provisions of this Section 2.24 may be amended with the consent of the Required Lenders; provided that no such amendment shall require any Lender to provide any Extended Loans/Commitments without such Lender’s consent.

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ARTICLE III

REPRESENTATIONS AND WARRANTIES

Each Loan Party represents and warrants to each of the Lenders that:

Section 3.01 Organization; Powers. Except as set forth on Schedule 3.01, each Loan Party and each of their Restricted Subsidiaries (a) is a partnership, limited partnership, limited liability company, exempted company or corporation duly organized and validly existing and, except where the failure to be in good standing would not reasonably be expected to have a Material Adverse Effect, in good standing (or, if applicable in a foreign jurisdiction, enjoys the equivalent status under the laws of any jurisdiction of organization outside the United States) under the laws of the jurisdiction of its organization, (b) has all requisite power and authority to own its property and assets and to carry on its business as now conducted, (c) is qualified to do business in each jurisdiction where such qualification is required, except where the failure so to qualify would not reasonably be expected to have a Material Adverse Effect, and (d) has the power and authority to execute, deliver and perform its obligations under each of the Loan Documents and each other agreement or instrument contemplated thereby to which it is or will be a party and, in the case of the Canadian Borrower, to borrow and otherwise obtain credit hereunder.

Section 3.02 Authorization. The execution, delivery and performance by each Loan Party of each of the Loan Documents to which it is a party, and the borrowings hereunder (a) have been duly authorized by all corporate, stockholder, shareholder, limited liability company, partnership or limited partnership action required to be obtained by such Loan Party and (b) will not (i) violate (A) any provision of law, statute, rule or regulation, or of the certificate or articles of incorporation, memorandum of association or other constitutive documents or by-laws or articles of association of such Loan Party, (B) any applicable order of any court or any rule, regulation or order of any Governmental Authority or (C) any provision of any indenture, certificate of designation for preferred stock, agreement or other instrument to which such Loan Party is a party or by which any of them or any of their property is or may be bound, (ii) be in conflict with, result in a breach of or constitute (alone or with notice or lapse of time or both) a default under, give rise to a right of or result in any cancellation or acceleration of any right or obligation (including any payment) or to a loss of a material benefit under any such indenture, certificate of designation for preferred stock, agreement or other instrument, where any such conflict, violation, breach or default referred to in clause (i) or (ii) of this Section 3.02, could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, or (iii) result in the creation or imposition of any Lien upon or with respect to any material property or assets now owned or hereafter acquired by any Loan Party, other than the Liens created by the Loan Documents.

Section 3.03 Enforceability. This Agreement has been duly executed and delivered by each Loan Party and constitutes, and each other Loan Document when executed and delivered by each Loan Party that is party thereto will constitute, a legal, valid and binding obligation of such Loan Party enforceable against each such Loan Party in accordance with its terms, subject to (a) the effects of bankruptcy, insolvency, moratorium, reorganization, fraudulent conveyance or other similar laws affecting creditors’ rights generally, (b) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law) and (c) implied covenants of good faith and fair dealing.

Section 3.04 Governmental Approvals. No action, consent or approval of, registration or filing with or any other action by any Governmental Authority is or will be required in connection with the Transactions, except for (a) the filing of UCC and PPSA financing statements and applications for registration in the PMRR, and filings to perfect security interests in intellectual property, (b) recordation of the Mortgages, (c) such consents, approvals, registrations, and filings with or by the FCC, U.S. Department of Justice, ISED (and, if required, the Competition Bureau or the CRTC) or any Governmental Authority outside of the United States of America or Canada as may be required in connection with the exercise of rights under the Security Documents following an Event of Default, (d) such consents, approvals, registrations, and filings with or by the FCC, U.S. Department of Justice, ISED or any Governmental Authority outside of the United States of America or Canada as may be required in the ordinary course of business of the Canadian Borrower and its Subsidiaries in connection with the use of proceeds of the Loans hereunder, (e) such as have been made or obtained and are in full force and effect, (f) such actions, consents and

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approvals the failure to be obtained or made which would not reasonably be expected to have a Material Adverse Effect and (g) filings or other actions listed on Schedule 3.04.

Section 3.05 Financial Statements. The Canadian Borrower has heretofore furnished to the Administrative Agent the consolidated balance sheets and related statements of income, shareholders’ deficit and cash flows of the Canadian Borrower and its consolidated Subsidiaries as of the end of and for each fiscal year of the Canadian Borrower in the three fiscal year period ended on December 31, 2018, audited by and accompanied by the opinion of Deloitte & Touche LLP. Such financial statements fairly present in all material respects the financial condition, results of operations and cash flows of the Canadian Borrower and its consolidated Subsidiaries as of such dates and for such periods. Such financial statements were prepared in accordance with GAAP consistently applied throughout the period covered thereby, except as otherwise expressly noted therein and subject, in the case of quarterly financial statements, to the absence of footnotes and to normal year-end adjustments.

Section 3.06 No Material Adverse Effect. Since December 31, 2018 (but after giving effect to the Transactions occurring on or prior to the Amendment No. 6 Effective Date) no Material Adverse Effect has occurred.

Section 3.07 Title to Properties; Possession Under Leases; Casualty Proceeds.

(a) Each of the Loan Parties and their Restricted Subsidiaries has good and marketable title to all real property and good title to all personal property owned by it and good and marketable title to a leasehold estate in the real and personal property leased by it, free and clear of all liens, charges, encumbrances or restrictions, except (i) as set forth in Schedule 3.07 and (ii) as created or expressly permitted by Section 6.02, except where the failure to have such title would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

(b) Each of the Loan Parties and their Restricted Subsidiaries has complied with all obligations under all leases to which it is a party, except where the failure to comply would not have a Material Adverse Effect, and all such leases are in full force and effect, except leases in respect of which the failure to be in full force and effect would not reasonably be expected to have a Material Adverse Effect. Each of the Loan Parties and each of their Subsidiaries enjoys peaceful and undisturbed possession under all such leases, other than leases in respect of which the failure to enjoy peaceful and undisturbed possession would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

(c) Each of the Loan Parties and their Restricted Subsidiaries owns or possesses, or could obtain ownership or possession of, on terms not materially adverse to it, all patents, trademarks, industrial designs, service marks, trade names, copyrights, licenses and rights with respect thereto necessary for the present conduct of its business, without any known conflict with the rights of others, and free from any burdensome restrictions, except where such conflicts and restrictions would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

(d) As of the Amendment No. 2 Effective Date, none of the Loan Parties or their Restricted Subsidiaries have received any notice of any pending or contemplated condemnation proceeding affecting any of the Mortgaged Properties or any sale or disposition thereof in lieu of condemnation that remains unresolved as of the Amendment No. 2 Effective Date.

(e) None of the Loan Parties and their Restricted Subsidiaries is obligated on the Amendment No. 2 Effective Date under any right of first refusal, option or other contractual right to sell, assign or otherwise dispose of any Mortgaged Property or any interest therein, except as permitted under Section 6.02 or 6.03.

(f) As of the Amendment No. 2 Effective Date, neither the Canadian Borrower nor any Restricted Subsidiary has received any notice of, nor has any knowledge of, the occurrence or pendency or contemplation of any Casualty Event affecting all or any portion of its property except where such Casualty Event would not reasonably be expected to have a Material Adverse Effect. 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

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special flood hazards within the meaning of the Flood Insurance Laws unless flood insurance available under the Flood Insurance Laws have been obtained in accordance with Section 5.02.

(g) As of the Amendment No. 2 Effective Date, none of the Loan Parties or their Subsidiaries have received any notice of or has any knowledge of any disputes regarding boundary lines, location, encroachments or possession of any portions of the Mortgaged Property owned by it and has no knowledge of any state of facts that may exist which could give rise to any such claims, except in each case where such dispute or claim would not be reasonably likely to have a material adverse effect on the intended use of such Mortgaged Property.

Section 3.08 Subsidiaries.

(a) As of the Amendment No. 2 Effective Date, the corporate structure of the Canadian Borrower and its Restricted Subsidiaries is in all material respects as set forth on Schedule 3.08(a).

(b) Schedule 3.08(b) sets forth as of the Amendment No. 2 Effective Date the name and jurisdiction of incorporation, formation or organization of each Material Subsidiary and, as to each such Material Subsidiary, the percentage of each class of Equity Interests owned by the Canadian Borrower or by any such Material Subsidiary, subject to such changes as are reasonably satisfactory to the Administrative Agent.

(c) As of the Amendment No. 2 Effective Date, there are no outstanding subscriptions, options, warrants, calls, rights or other similar agreements or commitments (other than stock options granted to employees or directors and directors’ qualifying shares) of any nature relating to any Equity Interests of the Loan Parties, the Canadian Borrower or any of their Restricted Subsidiaries, except as set forth on Schedule 3.08(c).

Section 3.09 Litigation; Compliance with Laws.

(a) Except as set forth on Schedule 3.09, there are no actions, suits, investigations or proceedings at law or in equity or by or on behalf of any Governmental Authority or in arbitration now pending, or, to the knowledge of the Canadian Borrower, threatened in writing against or affecting the Canadian Borrower or any of its Restricted Subsidiaries or any business, property or rights of any such person which could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

(b) None of the Loan Parties, the Material Subsidiaries and their respective properties or assets is in violation of (nor will the continued operation of their material properties and assets as currently conducted violate) any law, rule or regulation (including any zoning, building, Environmental Law, ordinance, code or approval or any building permit) or any restriction of record or agreement affecting any Mortgaged Property, or is in default with respect to any judgment, writ, injunction or decree of any Governmental Authority, where such violation or default could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

Section 3.10 Federal Reserve Regulations.

(a) None of the Loan Parties and their Restricted Subsidiaries is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying Margin Stock.

(b) No part of the proceeds of any Loan will be used, whether directly or indirectly, and whether immediately, incidentally or ultimately, for any purpose that entails a violation of, or that is inconsistent with, the provisions of the Regulations of the Board, including Regulation U or Regulation X.

Section 3.11 Investment Company Act. The Canadian Borrower is not required to register as an “investment company” within the meaning of the Investment Company Act of 1940, as amended.

Section 3.12 Use of Proceeds. After the Amendment No. 6 Effective Date, the Borrowers will use the proceeds of Revolving R-3 Facility Loans, Swingline Loans and the issuance of Letters of Credit for general corporate purposes. The Canadian Borrower will use the proceeds from the Term B-5 Loans, together with cash on hand (a) to finance the Existing Debt Refinancing and (b) to pay Transaction Expenses; provided that the proceeds of

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the Term B-5 Loans made on the Amendment No. 6 Effective Date shall be used for the repayment of Term B-4 Loans. The proceeds of Incremental Commitments shall be used for any purpose not prohibited by this Agreement.

Section 3.13 Tax Returns. Each of the Loan Parties (i) has timely filed or caused to be timely filed all U.S. and Canadian federal, state, provincial, local and other non-U.S. Tax returns required to have been filed by it and each such Tax return is true and correct, which returns, if not filed or not true and correct, could reasonably be expected to, individually or in the aggregate, have a Material Adverse Effect and (ii) has timely paid or caused to be timely paid all Taxes shown thereon to be due and payable by it and all other Taxes or assessments (including, in each case, in its capacity as a withholding agent), except Taxes or assessments that are being contested in good faith by appropriate proceedings in accordance with Section 5.03 and for which Canadian Borrower or any of the Material Subsidiaries (as the case may be) has set aside on its books adequate reserves which Taxes, if not timely paid, could reasonably be expected to, individually or in the aggregate, have a Material Adverse Effect;

Section 3.14 No Material Misstatements. (a) All written information (other than the projections described below, forward-looking information and information of a general economic or industry specific nature), that has been or is hereafter made available to the Administrative Agent or any of the Lenders by any Loan Party or Subsidiary or any of their respective representatives (or on such Loan Party or Subsidiary’s behalf) in connection with any aspect of the Transactions (the “Information”) is and will be, when taken as a whole, together with its public filings, complete and correct in all material respects as of the date such Information was furnished by the Loan Parties (or their respective representatives) to the Administrative Agent or any of their Lenders and (in the case of Information delivered prior to the Amendment No. 2 Effective Date, after giving effect to any supplements thereto delivered prior to the Amendment No. 2 Effective Date) as of the Amendment No. 2 Effective Date and does not and will not, when taken as a whole, contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements contained therein not materially misleading in light of the circumstances under which such statements were made and (b) all material financial projections concerning the Loan Parties that have been or are hereafter made available to the Administrative Agent or any of the Lenders by any Loan Party or Subsidiary or their respective representatives (or on such Loan Party or Subsidiary’s behalf) have been or will be prepared in good faith based upon assumptions believed by the maker thereof to be reasonable at the time made.

Section 3.15 Employee Benefit Plans.

(a) Except as would not reasonably be expected to have a Material Adverse Effect, each of the Canadian Borrower, the Restricted Subsidiaries and the ERISA Affiliates is in compliance with the applicable provisions of ERISA and the provisions of the Code relating to Employee Benefit Plans and the regulations and published interpretations thereunder and any similar applicable non-U.S. law. No Reportable Event has occurred during the past five years as to which the Canadian Borrower, any of the Restricted Subsidiaries or any ERISA Affiliate was required to file a report with the PBGC, except as would not reasonably be expected to have a Material Adverse Effect. The excess of the present value of all benefit liabilities under each Plan of the Canadian Borrower, the Subsidiaries and the ERISA Affiliates (based on those assumptions used to fund such Plan), as of the last annual valuation date applicable thereto for which a valuation is available, over the value of the assets of such Plan would not reasonably be expected to have a Material Adverse Effect, and the excess of the present value of all benefit liabilities of all underfunded Plans (based on those assumptions used to fund each such Plan) as of the last annual valuation dates applicable thereto for which valuations are available, over the value of the assets of all such underfunded Plans would not reasonably be expected to have a Material Adverse Effect. No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events which have occurred, could reasonably be expected to result in a Material Adverse Effect. None of the Canadian Borrower, the Restricted Subsidiaries and the ERISA Affiliates has received any written notification that any Multiemployer Plan is in “endangered” or “critical” status (within the meaning of Section 432 of the Code or Section 305 of ERISA) or has been terminated within the meaning of Title IV of ERISA, or has knowledge that any Multiemployer Plan is reasonably expected to be in endangered or critical status or to be terminated, where such status or termination has had or could reasonably be expected to have a Material Adverse Effect.

(b) Except as would not reasonably be expected to have a Material Adverse Effect, (i) each Non-U.S. Pension Plan has been maintained in compliance with its terms and with the requirements of any and all applicable

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laws, statutes, rules, regulations, orders and published interpretations thereunder and has been maintained, where required, in good standing with applicable regulatory authorities, (ii) all contributions required to be made with respect to a Non-U.S. Pension Plan have been timely made and (iii) none of the Canadian Borrower or any Restricted Subsidiary has incurred any obligation in connection with the termination of, or withdrawal from, any Non-U.S. Pension Plan. The excess, if any, of the present value of the accrued benefit liabilities (whether or not vested) under each Non-U.S. Pension Plan, determined as of the end of the Canadian Borrower’s most recently ended fiscal year on the basis of actuarial assumptions, each of which is reasonable, over the current value of the assets of such Non-U.S. Pension Plan allocable to such benefit liabilities would not reasonably be expected to have a Material Adverse Effect.

(c) Except as would not reasonably be expected to have a Material Adverse Effect, (i) all Canadian Plans are duly established, registered, administered and invested in compliance with the terms thereof, any applicable collective agreements and Applicable Canadian Pension Legislation (including the Income Tax Act (Canada)), (ii) no events have occurred and no action has been taken by any Person which would reasonably be likely to result in the wind-up or termination, in whole or in part, of any Canadian Plan, whether by declaration of any federal or provincial pension regulatory authority or otherwise, (iii) none of the obligors or any of their respective Subsidiaries has withdrawn any assets held in respect of any Canadian Plan except as permitted under the terms thereof and Applicable Canadian Pension Legislation and all reports, returns and filings required to be made thereunder have been made, (iv) no Canadian Plan has a solvency deficiency or going concern unfunded liability that is not funded in accordance with the regular funding requirements under Applicable Canadian Pension Legislation, (v) all contributions, premiums and other payments required to be paid to or in respect of each Canadian Plan have been paid in a timely fashion in accordance with the terms thereof and Applicable Canadian Pension Legislation, and no Taxes, penalties or fees are owing or eligible in respect of any Canadian Plan (vi) no actions, suits, claims or proceedings are pending or, to the knowledge of the obligors, threatened in respect of any Canadian Plan or its assets, other than routine claims for benefits, and (vii) no Canadian Plan is a multi-employer plan within the meaning of Applicable Canadian Pension Legislation.

Section 3.16 Environmental Matters. Except as to matters that would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect (a) no written notice, request for information, order, complaint or penalty has been received by the Borrowers or any of the Material Subsidiaries relating to Borrowers or any of the Material Subsidiaries, and there are no Environmental Claims relating to the Borrowers or any of the Material Subsidiaries pending or, to the knowledge of the Borrowers, threatened which allege a violation of or liability under any Environmental Laws, (b) each of the Borrowers and the Material Subsidiaries has all permits necessary for its current operations to comply with all Environmental Laws and is in compliance with the terms of such permits and with all other Environmental Laws, (c) as of the Amendment No. 2 Effective Date, there has been no written environmental audit or Phase I or Phase II Environmental Assessment conducted since October 31, 2007 by the Borrowers or any of the Material Subsidiaries of any property currently owned or leased by the Borrowers or any of the Material Subsidiaries which has not been made available to the Administrative Agent prior to the Amendment No. 2 Effective Date, (d) there has been no Release of any Hazardous Materials at, on, under or from any property currently, or, to the knowledge of the Borrowers or any of the Material Subsidiaries formerly owned or leased by the Borrowers or any of the Material Subsidiaries which would reasonably be expected to result in any liability of the Borrowers or any of the Material Subsidiaries under any Environmental Law, (e) no Hazardous Material generated, owned or controlled by the Borrowers or any of the Material Subsidiaries has been transported to, or treated or disposed of at, any location in a manner that would reasonably be expected to result in any liability of any of them under any Environmental Laws, (f) neither the Borrowers or any of the Material Subsidiaries are currently conducting or financing, either individually or together with other potentially responsible parties, any investigation, response or other corrective action at any location pursuant to any Environmental Law, (g) neither the Borrowers or any of the Material Subsidiaries has contractually assumed or undertaken responsibility for any liability or obligation of any other Person arising under or relating to Environmental Laws.

Section 3.17 Security Documents. Each of the Security Documents entered into on or, to the extent remaining outstanding, prior to the Amendment No. 2 Effective Date is effective to create in favor of the Collateral Agent (for the benefit of the Secured Creditors) a legal, valid and enforceable security interest or hypothec opposable to third parties, as applicable, in or on the Collateral described therein (subject to any limitations specified therein). In the case of the Pledged Collateral described in any of such Security Documents, and for which a security interest is perfected by delivery of such Pledged Collateral, when certificates or promissory notes, as applicable, representing

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such Pledged Collateral (and related stock or bond powers) are delivered to the Collateral Agent, and in the case of the other Collateral described in any such Security Document, when financing statements and other filings, recordings or actions specified in each Security Document in appropriate form are filed in the offices specified (or action taken as specified) in each such Security Document, the Collateral Agent (for the benefit of the Secured Creditors) shall have a fully perfected Lien on, and security interest in or published hypothec on (as applicable), all right, title and interest of each of the Loan Parties in such Collateral (subject to any limitations specified therein), as security for its Secured Obligations secured thereby, in each case prior and superior in right to any other person (except, Liens expressly permitted by Section 6.02 and Liens having priority by operation of law).

Section 3.18 Location of Real Property.

(a) Schedule 3.18(a) lists completely and correctly, in all material respects, as of the Amendment No. 2 Effective Date all material real property having a Fair Market Value (as determined in good faith by the Canadian Borrower) in excess of $10,000,000 owned by each Loan Party and the addresses thereof. As of the Amendment No. 2 Effective Date, each Loan Party owns in fee all the real property set forth as being owned by them on such Schedule.

(b) Schedule 3.18(b) lists completely and correctly, in all material respects, as of the Amendment No. 2 Effective Date all ground leased real property on which earth station equipment worth more than $10,000,000 (as determined in good faith by the Canadian Borrower) are located. As of the Amendment No. 2 Effective Date, each Loan Party has a valid lease in all the real property set forth as being leased by them on such Schedule.

Section 3.19 Solvency. Immediately after giving effect to the Transactions as of the Amendment No. 2 Effective Date (a) (i) the fair value of the assets of the Canadian Borrower and its Restricted Subsidiaries taken as a whole, at a fair valuation, will exceed the debts and liabilities, direct, subordinated, contingent or otherwise, of the Canadian Borrower and its Restricted Subsidiaries taken as a whole; (ii) the present fair saleable value of the property of the Canadian Borrower and its Restricted Subsidiaries taken as a whole will be greater than the amount that will be required to pay the probable liability of the Canadian Borrower and its Restricted Subsidiaries taken as a whole on their debts and other liabilities, direct, subordinated, contingent or otherwise, as such debts and other liabilities become absolute and matured; (iii) the Canadian Borrower and its Restricted Subsidiaries on a consolidated basis will be able to pay their debts and liabilities, direct, subordinated, contingent or otherwise, as such debts and liabilities become absolute and matured; and (iv) the Canadian Borrower and its Restricted Subsidiaries on a consolidated basis will not have unreasonably small capital with which to conduct the businesses in which they are engaged as such businesses are now conducted and are proposed to be conducted following the Amendment No. 2 Effective Date; and (b) (i) the property of the Canadian Borrower and its Restricted Subsidiaries taken as a whole, if disposed of (as a going concern) at a fairly conducted sale under legal process, would be sufficient to enable payment of all their obligations, due and accruing due, (ii) the property of the Canadian Borrower and its Restricted Subsidiaries taken as a whole, is, at a fair valuation, sufficient to enable payment of all their obligations, due and accruing due; (iii) none of the Loan Parties has ceased paying its current obligations in the ordinary course of business as they generally become due; and (iv) the Canadian Borrower and its Restricted Subsidiaries are able to meet their obligations as they generally become due.

Section 3.20 Labor Matters. Except as would not reasonably be expected to have a Material Adverse Effect, (a) there are no strikes pending or threatened against the Borrowers or any of the Material Subsidiaries, (b) the hours worked and payments made to employees of the Borrowers and the Material Subsidiaries have not been in violation in any respect of the Fair Labor Standards Act or any other applicable law dealing with such matters and (c) all payments due from the Canadian Borrower or any of the Material Subsidiaries or for which any claim may be made against the Borrowers or any of the Material Subsidiaries, on account of wages and employee health and welfare and employment insurance and other benefits have been paid or accrued as a liability on the books of the Borrowers or such Material Subsidiary to the extent required by GAAP. Except as set forth on Schedule 3.20, consummation of the Transactions will not give rise to a right of termination or right of renegotiation on the part of any union under any collective bargaining agreement to which the Borrowers or any of the Material Subsidiaries (or any predecessor) is a party or by which the Borrowers or any of the Material Subsidiaries (or any predecessor) is bound, other than collective bargaining agreements that, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect.

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Section 3.21 Foreign Assets Control Regulations, Anti-Terrorism Laws and Anti-Money Laundering Laws and the Patriot Act.

(a) None of the requesting or borrowing of the Loans, the requesting or issuance, extension or renewal of any Letters of Credit or the use of the proceeds of any thereof will violate any Requirements of Law imposed by the Trading With the Enemy Act (50 U.S.C. § 1 et seq., as amended) (“TWEA”) or any of the foreign assets control regulations of the United States Treasury Department’s Office of Foreign Assets Control (31 C.F.R., Subtitle B, Chapter V, as amended) (“OFAC”) (the “Foreign Assets Control Regulations”), or any Requirement of Law relating to Anti-Terrorism Laws, Anti-Money Laundering Laws or Anti-Corruption Laws, as defined herein, except where such violation or conduct will not result in a violation by the Lenders and is not reasonably likely to expose Lenders to liability.

(b) Neither the Canadian Borrower nor any of its Subsidiaries nor to the knowledge of the Canadian Borrower, any Affiliate, broker or agent of any Loan Party acting or benefiting in any capacity in connection with the Loans is:

(i) a Person that is listed in the annex to, or is otherwise subject to the provisions of, the Executive Order;

(ii) a Person owned or controlled by, or acting for or on behalf of, any Person that is listed in the annex to, or is otherwise subject to the provisions of, the Executive Order;

(iii) a Person with which any Lender is prohibited from dealing or otherwise engaging in any transaction by any Anti-Terrorism Laws and Anti-Money Laundering Laws;

(iv) a Person that is named on the list of “Specially Designated Nationals and Blocked Persons” on the most current list published by OFAC at its official website or any replacement website or other replacement official publication of such list;

(v) a Person that is owned or controlled by, or acting for or on behalf of, any Person that is named on the list of “Specially Designated Nationals and Blocked Persons” on the most current list published by OFAC at its official website or any replacement website or other replacement official publication of such list; or

(vi) a Person that is operating, organized or resident in a country, region or territory which is itself the subject or target of any Foreign Assets Control Regulations other than in compliance with Foreign Assets Control Regulations.

(c) Neither the Borrowers nor any of their Subsidiaries nor to the knowledge of each Borrower, any other Loan Party or Affiliate or broker or other agent of any Loan Party engages in transactions with any Person described in Sections 3.21(b)(i) through (vi), except where such transactions will not result in a violation by the Lenders and would not reasonably be likely to expose Lenders to liability.

Section 3.22 FCC Licenses, etc. As of the Amendment No. 2 Effective Date, Schedule 3.22 accurately and completely lists for each Satellite (a) all space station licenses for the launch and operation of Satellites with C-band or Ku-band transponders issued by the FCC to the Canadian Borrower or any Restricted Subsidiary and (b) all licenses and all other approvals, orders or authorizations issued or granted by any Governmental Authority outside of the United States of America (including ISED) to launch and operate any such Satellite. As of the Amendment No. 2 Effective Date, the FCC Licenses and the other licenses, approvals or authorizations listed on Schedule 3.22 with respect to any Satellite include all material authorizations, licenses and permits issued by the FCC, U.S. Department of Justice, ISED or any other Governmental Authority that are required or necessary to launch or operate such Satellite, as applicable. Except as would not reasonably be expected to have a Material Adverse Effect, each such license is validly issued and in full force and effect, and the Canadian Borrower and its Restricted Subsidiaries have fulfilled and performed in all material respects all of their obligations with respect thereto and have full power and authority to operate thereunder.

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Section 3.23 Satellites. Schedule 3.23 accurately and completely lists as of the Amendment No. 2 Effective Date each of the Satellites owned by the Canadian Borrower and its Restricted Subsidiaries on the Amendment No. 2 Effective Date, and sets forth for each such Satellite that is in orbit the orbital slot and number and frequency band of the transponders on such Satellite.

ARTICLE IV

CONDITIONS OF LENDING

The obligations of (a) the Lenders (including the Swingline Lenders) to make (but not the conversion or continuation of) Loans (other than with respect to Incremental Facilities and Extensions which shall be governed by Section 2.21 and 2.24, respectively) and (b) any L/C Issuer to issue Letters of Credit or increase the stated amounts of Letters of Credit hereunder (each, a “Credit Event”) are subject to the satisfaction of the following conditions:

Section 4.01 All Credit Events. On the date of the making (but not the conversion or continuation) of each Loan and on the date of each issuance of, or amendment that increases the stated amount of, a Letter of Credit:

(a) The Administrative Agent shall have received, in the case of a Borrowing, a Borrowing Request as required by Section 2.03 (or a Borrowing Request shall have been deemed given in accordance with the last paragraph of Section 2.03(a)) or, in the case of the issuance of a Letter of Credit, the applicable L/C Issuer and the Administrative Agent shall have received a Letter of Credit Request for such Letter of Credit as required by Section 2.05(c).

(b) The representations and warranties set forth in Article III hereof shall be true and correct in all material respects on and as of the date of such Borrowing or issuance or amendment that increases the stated amount of such Letter of Credit, as applicable, with the same effect as though made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date (in which case such representations and warranties shall be true and correct in all material respects as of such earlier date).

(c) At the time of and immediately after such Borrowing or issuance or amendment that increases the stated amount of such Letter of Credit, as applicable, no Event of Default or Default shall have occurred and be continuing.

(d) All of the conditions specified in Section 4.02 shall have been satisfied or waived on the Closing Date.

Each Borrowing and each issuance of, or amendment that increases the stated amount of, a Letter of Credit shall be deemed to constitute a representation and warranty by the applicable Borrower on the date of such Borrowing, issuance or amendment as applicable, as to the matters specified in paragraphs (b) and (c) of this Section 4.01.

Section 4.02 First Credit Event. The conditions to the Credit Events which occurred on the Closing Date were satisfied on the Closing Date.

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ARTICLE V

AFFIRMATIVE COVENANTS

Each of the Canadian Borrower and the Loan Parties covenants and agrees with each Lender that so long as this Agreement shall remain in effect and until the Commitments have been terminated and the principal of and interest on each Loan, all Fees and all other expenses or amounts payable under any Loan Document shall have been paid in full (other than contingent amounts not yet due) and all Letters of Credit have been canceled or have expired and all amounts drawn thereunder have been reimbursed in full, unless the Required Lenders shall otherwise consent in writing, each Loan Party will, and (other than Sections 5.04 and 5.05) will cause each of the Restricted Subsidiaries to:

Section 5.01 Existence; Businesses and Properties.

(a) Do or cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence, except as otherwise expressly permitted under Section 6.03 or except where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect, and except for the liquidation or dissolution of Subsidiaries if the assets of such Subsidiaries to the extent they exceed estimated liabilities are acquired by the Canadian Borrower or a Wholly Owned Subsidiary of the Canadian Borrower in such liquidation or dissolution; provided that, except as otherwise permitted under Section 6.03, Subsidiary Loan Parties may not be liquidated into Non-Subsidiary Loan Parties unless the liquidation is a Permitted Investment or an Investment permitted by Section 6.06.

(b) Except where the failure is not reasonably likely to have a Material Adverse Effect, do or cause to be done all things reasonably necessary to (i) obtain, preserve, renew, extend and keep in full force and effect the permits, franchises, authorizations, patents, industrial designs, trademarks, service marks, trade names, copyrights, licenses and rights with respect thereto necessary to the normal conduct of its business, (ii) comply in all respects with all applicable laws, rules, regulations (including any zoning, building, ordinance, code or approval or any building permits or any restrictions of record or agreements affecting the Mortgaged Properties) and judgments, writs, injunctions, decrees and orders of any Governmental Authority, whether now in effect or hereafter enacted, (iii) at all times maintain and preserve all property necessary to the normal conduct of its business and keep such property in good repair, working order and condition and from time to time make, or cause to be made, all needful and proper repairs, renewals, additions, improvements and replacements thereto necessary in order that the business carried on in connection therewith, if any, may be properly conducted at all times (in each case except as expressly permitted by this Agreement) and (iv) subject to Liens permitted by Section 6.02, keep in effect all rights and appurtenances to or that constitute a part of the Mortgaged Property and protect, preserve and defend all its right, title and interest in the Mortgaged Property and title thereto.

Section 5.02 Insurance.

(a) Generally. The Canadian Borrower will, and will cause each of the Restricted Subsidiaries to, at all times maintain in full force and effect, with insurance companies that the Canadian Borrower believes (in the good faith judgment of the management of the Canadian Borrower) are financially sound and responsible at the time the relevant coverage is placed or renewed, insurance in at least such amounts and against at least such risks (and with such risk retentions) as are usually insured against in the same general area by companies engaged in the same or a similar business; and will furnish to the Lenders, upon written request from the Administrative Agent, information presented in reasonable detail as to the insurance so carried.

(b) Covered Satellites. The Canadian Borrower will, and the Canadian Borrower will cause each of its Restricted Subsidiaries to, obtain, maintain and keep in full force and effect at all times (i) with respect to each Satellite procured by the Canadian Borrower or any of its Restricted Subsidiaries for which the risk of loss passes to the Canadian Borrower or such Restricted Subsidiary at or before launch, and for which launch insurance or commitments with respect thereto are not in place as of the Amendment No. 2 Effective Date, launch insurance with respect to each such Satellite covering the launch of such Satellite and a period of time thereafter and with such industry standard terms (including exclusions, limitations on coverage, co-insurance and deductibles) as are

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generally available on commercially reasonable terms, (ii) with respect to each Satellite it currently owns or for which it has risk of loss (or, if the entire Satellite is not owned, the portion it owns or for which it has risk of loss), other than any Excluded Satellite, In-Orbit Insurance and (iii) at all times subsequent to the coverage period of the launch insurance described in clause (i) above, if any, or if launch insurance is not procured, at all times subsequent to the initial completion of in-orbit testing, in each case with respect to each Satellite it then owns or for which it has risk of loss (or portion, as applicable), other than any Excluded Satellite, In-Orbit Insurance; provided, however, that at any time with respect to a Satellite that is not an Excluded Satellite, none of the Canadian Borrower or any of its Subsidiaries shall be required to maintain In-Orbit Insurance in excess of 33% of the aggregate net book value of any individual and 50% of the aggregate net book value of all in-orbit Satellites (and portions it owns or for which it has risk of loss) insured (it being understood that any Satellite (or portion, as applicable) protected by In-Orbit Contingency Protection shall be deemed to be insured for a percentage of its net book value as set forth in the definition of “In-Orbit Contingency Protection”). In the event that the expiration and non-renewal of In-Orbit Insurance for such a Satellite (or portion, as applicable) resulting from a claim of loss under such policy causes a failure to comply with the proviso in the immediately preceding sentence, the Canadian Borrower and its Restricted Subsidiaries shall be deemed to be in compliance with such proviso for the 120 days immediately following such expiration or non-renewal; provided that the Canadian Borrower or any of its Restricted Subsidiaries, as the case may be, procures such In-Orbit Insurance or provides such In-Orbit Contingency Protection as necessary to comply with such proviso within such 120-day period. In the event of the unavailability of any In-Orbit Contingency Protection for any reason, the Canadian Borrower or any of its Restricted Subsidiaries, as the case may be, shall, subject to the first proviso above, within 120 days of such unavailability, be required to have in effect In-Orbit Insurance complying with clause (ii) or (iii) above, as applicable, with respect to all Satellites (or portions, as applicable), other than Excluded Satellites that the unavailable In-Orbit Contingency Protection was intended to protect and for so long as such In-Orbit Contingency Protection is unavailable; provided that the Canadian Borrower and its Restricted Subsidiaries shall be considered in compliance with this insurance covenant for the 120 days immediately following such unavailability.

(c) Procurement of Insurance by Administrative Agent. Without limiting the obligations of the Canadian Borrower or any Restricted Subsidiary under this Section 5.02, in the event the Canadian Borrower or any Restricted Subsidiary shall fail to maintain in full force and effect insurance as required by this Section 5.02, then, following an Event of Default, the Administrative Agent may, but shall have no obligation to, upon reasonable prior notice to the Canadian Borrower of its intention to do so, procure insurance covering the interests of the Lenders and the Administrative Agent in such amounts and against such risks as are required hereby, and the Canadian Borrower shall reimburse the Administrative Agent in respect of any premiums paid by the Administrative Agent in respect thereof.

(d) The Canadian Borrower will, and the Canadian Borrower will cause each of its Restricted Subsidiaries to, use commercially reasonable efforts to cause all insurance in favor of the Collateral Agent required under this Section 5.02 to be endorsed to the Collateral Agent’s reasonable satisfaction for the benefit of the Collateral Agent (including, without limitation, by naming the Collateral Agent as additional insured and loss payee with respect to real property, certificate holder and loss payee with respect to personal property and additional insured with respect to general liability and umbrella liability coverage; provided that (i) insurance covering any assets or property not constituting Collateral and (ii) insurance with respect to Export Financings shall not be made in favor of the Collateral Agent, and the Canadian Borrower and the Restricted Subsidiaries shall not be required to use commercially reasonable efforts to name the Collateral Agent as additional insured, certificate holder or loss payee with respect to any such insurance.

(e) In the event that the Canadian Borrower or its Subsidiaries receive Net Cash Proceeds in excess of $10,000,000 from any Satellite insurance covering any Satellite owned by the Canadian Borrower or any of the Restricted Subsidiaries, or in the event that the Canadian Borrower or any of its Subsidiaries receives Net Cash Proceeds in excess of $10,000,000 from any insurance maintained for it by a Satellite Manufacturer or any Launch Services Provider covering any of such Satellites as a result of a Casualty Event, the Net Cash Proceeds in respect of such Casualty Event shall be applied in the manner provided for in Section 2.12(c).

(f) Without prejudice to the other provisions of this Section 5.02, the Canadian Borrower will, and will cause each of the Restricted Subsidiaries to, at all times maintain insurance on and in relation to its Mortgaged Properties with reputable underwriters or insurance companies of such type, to such extent, against such risks and in

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such amounts as are customarily insured against by companies in a similar business such as that carried on by the relevant Loan Party.

(g) The Canadian Borrower will, and will cause each of the Restricted Subsidiaries to, notify the Administrative Agent and the Collateral Agent promptly whenever any separate insurance concurrent in form or contributing in the event of loss with that required to be maintained under this Section 5.02 is taken out by the Canadian Borrower or any of the Restricted Subsidiaries; and promptly deliver to the Administrative Agent and the Collateral Agent a duplicate original copy of such policy or policies, or an insurance certificate with respect thereto.

(h) Flood Insurance. If any portion of any Mortgaged Property located in the United States is at any time located in an area identified by the Federal Emergency Management Agency (or any successor agency) as a special flood hazard area with respect to which flood insurance has been made available under the Flood Insurance Laws, then the Canadian Borrower shall, or shall cause each Loan Party to (i) maintain, or cause to be maintained, with a financially sound and reputable insurer, flood insurance in an amount and otherwise sufficient to comply with all applicable rules and regulations promulgated pursuant to the Flood Insurance Laws and (ii) deliver to the Administrative Agent evidence of such compliance in form and substance reasonably acceptable to the Administrative Agent; provided, however, that the Administrative Agent may, in its reasonable discretion, exclude any Material Real Property from the Collateral and Guarantee Requirement and the requirements of this Section 5.02(h) where the cost and time required to comply with the Flood Insurance Laws and the provisions of this Section 5.02(h) are deemed, in the reasonable discretion of the Administrative Agent, too onerous.

Section 5.03 Taxes. Pay and discharge promptly when due all material Taxes, assessments and governmental charges or levies imposed upon it or upon its income, profits or capital or in respect of its property (including, in each case, in its capacity as a withholding agent), before the same shall become delinquent or in default, as well as all lawful claims for labor, materials and supplies or otherwise that, if unpaid, might give rise to a Lien upon such properties or any part thereof; provided, however, that such payment and discharge shall not be required with respect to any such Tax, assessment, charge, levy or claim so long as either (x) the validity or amount thereof shall be contested in good faith by appropriate proceedings, and the Canadian Borrower or the affected Restricted Subsidiary, as applicable, shall have set aside on its books reserves in accordance with GAAP with respect thereto or (y) the nonpayment of the same would not reasonably be likely to, individually or in the aggregate, have a Material Adverse Effect.

Section 5.04 Financial Statements, Reports, etc. Furnish to the Administrative Agent (which will promptly furnish such information to the Lenders):

(a) within 90 days after the end of each fiscal year, commencing with the fiscal year ended December 31, 2016, (i) a consolidated balance sheet and related consolidated statements of operations, cash flows and owners’ equity showing the financial position of the Canadian Borrower and the Subsidiaries as of the close of such fiscal year and the consolidated results of their operations during such year, with all consolidated statements audited by independent public accountants of recognized national standing and accompanied by an opinion of such accountants (which shall not be qualified in any material respect (other than solely with respect to, or expressly resulting solely from, an upcoming maturity date of any Indebtedness)) to the effect that such consolidated financial statements fairly present, in all material respects, the financial position and results of operations of the Canadian Borrower and the Subsidiaries on a consolidated basis in accordance with GAAP and (ii) a management report setting forth (A) Consolidated EBITDA of the Canadian Borrower for such fiscal year, showing variance, by dollar amount and percentage, from amounts for the previous fiscal year, (B) such key operational information as the Canadian Borrower and Administrative Agent may agree to, and (C) a management discussion and analysis of the financial condition and results of operations of the Canadian Borrower for such fiscal year, as compared to amounts for the previous fiscal year (it being understood that the delivery by the Canadian Borrower of (x) financial information for such fiscal year that would be required to be contained in a filing with the SEC on Form 20-F if the Canadian Borrower were required to file such forms, (y) whether or not required by the forms referred to in clause (i) above, a “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and (z) the opinion of accountants referred to above, shall satisfy the requirements of this Section 5.04(a));

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(b) within 50 days after the end of each of the first three fiscal quarters of each fiscal year commencing with the fiscal quarter ending March 31, 2017, (i) a consolidated balance sheet and related consolidated statements of operations and cash flows showing the financial position of the Canadian Borrower and its Subsidiaries as of the close of such fiscal quarter and the consolidated results of their operations during such fiscal quarter and the then-elapsed portion of the fiscal year (cash flow is for cumulative period only), all certified by a Financial Officer of the Canadian Borrower, on behalf of the Canadian Borrower, as fairly presenting, in all material respect, the financial position and results of operations of the Canadian Borrower and its Subsidiaries on a consolidated basis in accordance with GAAP (subject to normal year-end adjustments and the absence of footnotes) and (ii) a management report setting forth (A) Consolidated EBITDA of the Canadian Borrower for such fiscal quarter and for the then elapsed portion of the fiscal year, showing variance, by dollar amount and percentage, from amounts for the comparable periods in the previous fiscal year, (B) such key operational information as the Canadian Borrower and the Administrative Agent may agree to, and (C) a management discussion and analysis of the financial condition and results of operations for such fiscal quarter as compared to the comparable period in the previous fiscal year;

(c) (x) concurrently with any delivery of financial statements under (a) or (b) above, a certificate of a Financial Officer of the Canadian Borrower on behalf of the Canadian Borrower (i) certifying that no Event of Default or Default has occurred or, if such an Event of Default or Default has occurred, specifying the nature and extent thereof and any corrective action taken or proposed to be taken with respect thereto, (ii) commencing with the fiscal period ending December 31, 2016, (iii) setting forth computations in reasonable detail demonstrating compliance with the covenant contained in Section 6.09, if then applicable, and (iv) setting forth computations of the Applicable Amounts then available, and (y) the related consolidating financial information reflecting the adjustments necessary in reasonable detail to eliminate the accounts of Unrestricted Subsidiaries;

(d) promptly after the same become publicly available, copies of all periodic and other publicly available reports, proxy statements and, to the extent reasonably requested by the Administrative Agent, other materials filed by the Canadian Borrower or any of its Subsidiaries with the SEC, or after an initial public offering, distributed to its stockholders generally, as applicable;

(e) within 90 days after the beginning of each fiscal year, an annual summary operating and capital expenditure budget prepared by the Canadian Borrower for such fiscal year prepared in reasonable detail, of the Canadian Borrower and the Subsidiaries, accompanied by the statement of a Financial Officer of the Canadian Borrower to the effect that such budget has been reviewed by the Canadian Borrower’s Board of Directors;

(f) upon the reasonable request of the Administrative Agent (which request shall not be made more than once in any 12-month period unless specifically provided otherwise in any of the Security Documents), deliver updated information reflecting all changes since the date of the information most recently received pursuant to Section 5.10(d);

(g) promptly, from time to time, (x) but subject to the limitations set forth in Section 9.16, such other information regarding the operations, business affairs and financial condition of the Canadian Borrower or any of the Subsidiaries, or compliance with the terms of any Loan Document, as in each case the Administrative Agent may reasonably request and (y) information and documentation reasonably requested by the Administrative Agent or any Lender for purposes of compliance with applicable “know your customer” and anti-money laundering rules and regulations, including the Patriot Act and the Beneficial Ownership Regulation; and

(h) promptly upon request by the Administrative Agent, but subject to the limitations set forth in Section 9.16, copies of: (i) each Schedule B (Actuarial Information) to the annual report (Form 5500 Series) filed with the Employee Benefits Security Administration with respect to a Plan; (ii) the most recent actuarial valuation report for any Plan; (iii) all notices received from a Multiemployer Plan sponsor or any Governmental Agency concerning an ERISA Event; and (iv) such other documents or governmental reports

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or filings relating to any Non-U.S. Pension Plan, Canadian Plan or Multiemployer Plan as the Administrative Agent shall reasonably request.

Documents required to be delivered pursuant to Section 5.04(a), (b) or (d) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date (i) to the extent any such documents are included in materials otherwise filed with the SEC on which the Canadian Borrower posts such documents, or provides a link thereto on the Canadian Borrower’s website on the Internet at the website address listed on Schedule 5.04; or (ii) on which such documents are posted on the Canadian Borrower’s behalf on IntraLinks/IntraAgency/SyndTrak or another relevant website, if any, to which each Lender and the Administrative Agent have access (whether a commercial, third party website or whether sponsored by the Administrative Agent); provided that the Canadian Borrower shall immediately notify (which may be by facsimile or electronic mail) the Administrative Agent of the posting of any such documents and provide to the Administrative Agent by electronic mail electronic versions (i.e., soft copies) of such documents. For the avoidance of doubt, the delivery of information pursuant to this paragraph may be satisfied by delivery of the information required pursuant to Section 5.04(a), (b) or (d) with respect to any parent entity of the Canadian Borrower, provided that, to the extent such information relates to such parent entity, such information is accompanied by consolidating information that explains in reasonable detail the differences between the information relating such parent entity, on the one hand, and the information relating to the Canadian Borrower and its consolidated Subsidiaries on a standalone basis, on the other hand.

Section 5.05 Litigation and Other Notices. Furnish to the Administrative Agent written notice of the following promptly after any Responsible Officer of any Borrower obtains actual knowledge thereof:

(a) any Event of Default or Default, specifying the nature and extent thereof and the corrective action (if any) proposed to be taken with respect thereto;

(b) the filing or commencement of, or any written threat or notice of intention of any person to file or commence, any action, suit or proceeding, whether at law or in equity or by or before any Governmental Authority or in arbitration, against the Canadian Borrower or any of the Subsidiaries as to which an adverse determination is reasonably probable and which, if adversely determined, could reasonably be expected to have a Material Adverse Effect;

(c) any other development specific to the Canadian Borrower or any of the Subsidiaries that is not a matter of general public knowledge and that has had, or could reasonably be expected to have, a Material Adverse Effect;

(d) the occurrence of any ERISA Event, that together with all other ERISA Events that have occurred, could reasonably be expected to have a Material Adverse Effect; and

(e) the occurrence of any Canadian Pension Event that, together with all other Canadian Pension Events that have occurred, could reasonably be expected to have a Material Adverse Effect.

Section 5.06 Compliance with Laws. Comply with all laws, rules, regulations and orders of any Governmental Authority (including without limitation the Telesat Canada Reorganization and Divestiture Act as in effect from time to time) applicable to it or its property, except where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect; provided that the Canadian Borrower and the Loan Parties will maintain in effect and enforce policies and procedures designed to ensure compliance by the Canadian Borrower, the Loan Parties, their Restricted Subsidiaries, and their respective directors, officers, employees and agents with applicable Foreign Assets Control Regulations, Anti-Terrorism Laws and Anti-Money Laundering Laws, in each case as defined herein; provided, further, that this Section 5.06 shall not apply to Environmental Laws, which are the subject of Section 5.09, or to laws related to Taxes, which are the subject of Section 5.03.

Section 5.07 Maintaining Records; Access to Properties and Inspections. The Canadian Borrower will, and will cause each of the Restricted Subsidiaries to, maintain proper books of record and account, in which entries that are full, true and correct in all material respects and are in conformity with GAAP consistently applied shall be

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made of all material financial transactions and matters involving the assets and business of the Canadian Borrower and such Restricted Subsidiary, as the case may be. the Canadian Borrower will, and will cause each of the Restricted Subsidiaries to, permit representatives and independent contractors of the Administrative Agent and the Required Lenders to visit and inspect any of its properties (to the extent it is within such Person’s control to permit such inspection), to examine its corporate, financial and operating records, and make copies thereof or abstracts therefrom, and to discuss its affairs, finances and accounts with its directors, officers, and independent public accountants, all at the reasonable expense of the Canadian Borrower and at such reasonable times during normal business hours and as often as may be reasonably desired, upon reasonable advance notice to the Canadian Borrower (and subject, in the case of any such meetings or advice from such independent accountants, to such accountants’ customary policies and procedures); provided that, excluding any such visits and inspections during the continuation of an Event of Default, only the Administrative Agent on behalf of the Lenders may exercise rights of the Administrative Agent and the Required Lenders under this Section 5.07, and the Administrative Agent shall not exercise such rights more often than once during any calendar year absent the existence of an Event of Default at the Canadian Borrower’s expense; and provided, further, that when an Event of Default exists, the Administrative Agent or the Required Lenders (or any of their respective representatives or independent contractors) may do any of the foregoing at the expense of the Canadian Borrower at any time during normal business hours and upon reasonable advance notice. The Administrative Agent and the Required Lenders shall give the Canadian Borrower the opportunity to participate in any discussions with the Canadian Borrower’s independent public accountants. Notwithstanding anything to the contrary in Section 5.04 or this Section 5.07, none of the Canadian Borrower or any Restricted Subsidiary will be required to disclose, permit the inspection, examination or making copies or abstracts of, or discussion of, any document, information or other matter (i) that constitutes non-financial trade secrets or non-financial proprietary information, (ii) in respect of which disclosure to any Agent or any Lender (or their respective representatives or contractors) is prohibited by Applicable Law or any binding agreement or (iii) that is subject to attorney-client or similar privilege or constitutes attorney work product.

Section 5.08 Use of Proceeds. Use the proceeds of Loans and request issuances of Letters of Credit only in compliance with the representation contained in Section 3.12; provided that the Canadian Borrower will not request any Borrowing or Letter of Credit, and the Canadian Borrower, the Loan Parties and the Restricted Subsidiaries shall not use the proceeds of any Borrowing or Letter of Credit in a manner that would violate any Requirements of Law imposed by the Foreign Assets Control Regulations, Anti-Terrorism Laws, Anti-Money Laundering Laws or Anti-Corruption Laws, in each case as defined herein, except where such violation or conduct will not result in a violation by the Lenders and is not reasonably likely to expose Lenders to liability.

Section 5.09 Compliance with Environmental Laws. Comply, and make commercially reasonable efforts to cause all lessees and other persons occupying its properties to comply, with all Environmental Laws applicable to its operations, properties and facilities, and obtain and renew all authorizations and permits required pursuant to Environmental Law for its operations, properties and facilities, in each case in accordance with Environmental Laws, except, in each case with respect to this Section 5.09, to the extent the failure to do so would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

Section 5.10 Further Assurances; Additional Mortgages. Subject to the limitations set forth in this Agreement and the Security Documents, execute any and all further documents, financing statements, agreements and instruments, and take all such further actions (including the filing and recording of financing statements, fixture filings, Mortgages and other documents and recordings of Liens in stock registries), that may be required under any applicable law or that the Administrative Agent may reasonably request, to cause the Collateral and Guarantee Requirements to be and remain satisfied, all at the expense of the Loan Parties and provide to the Administrative Agent, from time to time upon reasonable request, evidence reasonably satisfactory to the Administrative Agent as to the perfection and priority of the Liens created or intended to be created by the Security Documents.

(a) If any asset (including any owned real property (other than real property covered by Section 5.10(b) below) or improvements thereto or any interest therein) that has an individual Fair Market Value (as reasonably determined by the Canadian Borrower in good faith) in an amount greater than $10,000,000 on the date of acquisition thereof is acquired by any Loan Party after the Amendment No. 2 Effective Date or owned by an entity at the time it first becomes a Loan Party (in each case other than assets constituting Collateral under a Security Document that become subject to the Lien of such Security Document upon acquisition thereof), cause such asset to be subjected to a Lien securing the Secured Obligations and take, and cause the Loan Parties to take, such actions as

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shall be necessary or reasonably requested by the Administrative Agent to grant and perfect such Liens on such real property consistent with the applicable requirements of the Security Documents and this Section 5.10, including actions described in paragraph (a) of this Section, all at the expense of the Loan Parties, subject to paragraph (e) below.

(b) To the extent acquired after the Amendment No. 2 Effective Date, (i) in the case of owned real property having a Fair Market Value (as determined in good faith by the Canadian Borrower) at the time of acquisition in excess of $10,000,000 (each such property a “Material Owned Real Property”), grant, and cause each of the Loan Parties to grant, within 60 days after the closing of such acquisition to the Collateral Agent (or such longer period as may be consented to by the Administrative Agent, in its reasonable discretion), Mortgages in and charges on such Material Real Property of any Loan Parties as are not covered by the original Mortgages and (ii) in the case of each ground leased real property on which earth station equipment worth more than $10,000,000 (as determined in good faith by the Canadian Borrower) are located (each such property a “Material Leased Real Property”), use commercially reasonable efforts (it being understood that in no event shall such efforts require the making of payments or material concessions in exchange for such consent) to obtain from the applicable landlord consent to grant a leasehold Mortgage in such lease, and if such consent is obtained, to grant, and cause the Loan Party to grant, within 60 days after such consent is received (or such longer period as may be consented to by the Administrative Agent, in its sole discretion), to the Collateral Agent, leasehold Mortgages in and charges on such leased real property of any Loan Party as are not covered by the original Mortgages, in each case pursuant to documentation substantially in the form of the Mortgages delivered to the Collateral Agent on the Closing Date or in such other form as is reasonably satisfactory to the Collateral Agent (each, an “Additional Mortgage”) and constituting valid and enforceable perfected Liens superior to and prior to the rights of all third persons subject to no other Liens except as are permitted by Section 6.02 or arising by operation of law, at the time of perfection thereof, record or file, and cause each such Subsidiary to record or file, the Additional Mortgage or instruments related thereto in such manner and in such places as is required by law to establish, perfect, preserve and protect the Liens in favor of the Collateral Agent required to be granted pursuant to the Additional Mortgages and pay, and cause each such Subsidiary to pay, in full, all Taxes, fees and other charges payable in connection therewith, in each case subject to paragraph (e) below and otherwise comply with the Collateral and Guarantee Requirements.

(c) If any additional direct or indirect Material Subsidiary that is a Wholly Owned Subsidiary of the Canadian Borrower is formed or acquired after the Amendment No. 2 Effective Date and if such Material Subsidiary is a Subsidiary Loan Party, or if any Subsidiary otherwise becomes a Subsidiary Loan Party after the Amendment No. 2 Effective Date, within 10 Business Days after the date such Subsidiary is formed or acquired or becomes a Subsidiary Loan Party, notify the Administrative Agent and the Lenders thereof and, within 45 Business Days (or such longer period as may be permitted by the Administrative Agent, in its sole discretion) (or, in the case of any Mortgages required to be granted, 90 days (or such longer period as may be permitted by the Administrative Agent, in its reasonable discretion)) after the date such Subsidiary is formed or acquired or becomes a Subsidiary Loan Party, cause the Collateral and Guarantee Requirements to be satisfied with respect to such Subsidiary and with respect to any Equity Interest in or Indebtedness of such Subsidiary owned by or on behalf of any Loan Party.

(d) In the case of the Canadian Borrower, (i) furnish to the Collateral Agent prompt written notice (which shall in any event be provided within 30 days of such change or such longer period as the Administrative Agent may reasonably agree) of any change (A) in any Loan Party’s corporate or organization name, (B) in any Loan Party’s jurisdiction of organization or type of organization (C) in any Loan Party’s organizational identification number or (D) in the location of the chief executive office, principal place of business, registered office (pursuant to its constating documents) or (but only if actions are required to perfect the security interest therein as a result of such change) tangible Collateral (other than inventory in transit) valued in excess of $10,000,000; provided that Canadian Borrower shall cause all filings to be made within any statutory period, under the UCC, PPSA or otherwise that are required in order for the Collateral Agent to continue at all times following such change to have a valid, legal and perfected security interest in or other applicable Lien on all the Collateral for the benefit of the Secured Creditors.

(e) The Collateral and Guarantee Requirements and the other provisions of this Section 5.10 need not be satisfied with respect to: (i) any assets of the Canadian Borrower and its Subsidiaries’ network services business located outside of the United States and Canada (to the extent such assets are not material and non-essential (as determined in good faith by the Canadian Borrower) for the operations of the Canadian Borrower and its Subsidiaries), (ii) any grant of Liens over assets (or, if applicable, perfection of liens) if to do so would contravene

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the Agreed Security Principles, (iii) any other Contract that by its terms would be breached, defaulted, violated, invalidated, require the consent of a third Person not obtained or rendered unenforceable by the creation of any other Lien on such property or if the creation of any other Lien on such property would create a right of termination in favor of any party (other than to the extent that any such term would be rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC or any successor provision or provisions or similar provisions of any applicable law); provided that for satellite purchase contracts and other contracts material (as determined in good faith by the Canadian Borrower) to the operation of the Loan Parties and their Restricted Subsidiaries taken as a whole, upon the request of Collateral Agent, Guarantor shall use commercially reasonable efforts to obtain such consent (but shall not be required to make any payment or material concession in exchange for such consent); provided, further, that under no circumstances shall the Canadian Borrower or any Restricted Subsidiary be obligated to seek consent to pledge customer agreements, (iv) real estate leasehold interests (including all office leases and including requirements to deliver landlord lien waivers, estoppels and collateral access letters), other than ground leased real property on which earth station equipment worth more than $10,000,000 (as determined in good faith by the Canadian Borrower) are located, (v) vehicles and other goods for which possession of a certificate of title or ownership is required for perfection of a security interest therein, (vi) any Collateral excluded with the written consent of the Administrative Agent (such consent not to be unreasonably withheld) after taking into account the value of such assets and the burden (including tax, administrative or otherwise) of creating and perfecting liens on such assets, (vii) any application for registration of a Trademark filed with the United States Patent and Trademark Office on an intent-to-use basis until such time (if any) as a Statement of Use or Amendment to Allege Use is filed, at which time such Trademark shall automatically become part of the Collateral and subject to the security interest pledged, (viii) any property to the extent that such grant of a security interest is prohibited by the law of a Governmental Authority, or requires a consent not obtained of any Governmental Authority pursuant to such law (other than to the extent that any such law would be rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC or any successor provision or provisions or similar provisions of any applicable law), (ix) property not otherwise excluded from the Collateral and Guarantee Requirements that is subject to a Lien permitted under clauses (6) (with respect to clause (d) of the definition of Permitted Debt), (7), (9), (10) or (18) (but only to the extent permitted under clauses (6) (with respect to clause (d) of the definition of Permitted Debt), (7), (9) or (10) of the definition of Permitted Liens) of the definition of Permitted Liens, including any insurance and other proceeds thereof, (x) Excluded Collateral (as defined in the Security Agreement) owned by the Canadian Borrower or any Restricted Subsidiary, (xi) Letter of Credit Rights (as defined in the UCC) for a specified purpose to the extent the Canadian Borrower or any Restricted Subsidiary is required by applicable law to apply the proceeds of such Letter of Credit Rights for a specified purpose, (xii) any FCC Licenses to the extent (but only to the extent) that at such time the Collateral Agent may not validly possess a security interest therein pursuant to the laws, and the regulations promulgated by any Governmental Authority, as in effect at such time, but Collateral shall include, to the maximum extent permitted by law, all rights incident or appurtenant to the FCC Licenses and the right to receive all proceeds derived from or in connection with the sale, assignment or transfer of the telecommunications licenses, (xiii) a lien on the ownership interest with respect to the APT Transponders or APT’s interest in the “Common Elements” as defined in the Amended and Restated Satellite Agreement dated as of August 26, 2003, as amended (together with that certain Satellite Procurement Contract dated December 23, 2015, that certain Management Agreement dated as of December 23, 2015, that certain Satellite Transponder Agreement dated as of December 23, 2015, that certain Orbital Slot Sublicense Agreement dated as of December 31, 2015 and that certain Marketing Agreement dated as of December 31, 2015, the “APT Satellite Agreement”) between APT Satellite Company Limited (including its successors, assigns and transferees, “APT”), and Loral Orion, Inc. (as assigned to Telesat Satellite LP), that are on Telstar 18 (collectively, the “Excluded APT Elements”) so long as such prohibition exists in the APT Satellite Agreement, any other agreement with APT or the APT Security Agreement (or any replacement or successor agreement), it being understood that subject to the foregoing, a lien on the Satellite (as defined in the APT Satellite Agreement) is permitted so long as the lien thereon (which the Collateral Agent shall be permitted to release at any time in its sole discretion) is subject to the rights of APT under the APT Satellite Agreement and does not encompass the Excluded APT Elements; (xiv) Excluded Accounts (as defined in the Security Agreement), (xv) Equity Interests of Unrestricted Subsidiaries, (xvi) any Equity Interests (A) owned as of the Amendment No. 2 Effective Date or acquired after the Amendment No. 2 Effective Date in accordance with this Agreement if, and to the extent that, and for so long as (1) such grant would violate applicable law or a contractual obligation binding on such Equity Interests (other than to the extent that any such law or contractual obligation would be rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC, or any successor provision or provisions or similar provisions of any applicable law) and (2) such law or contractual obligation existed at the time of the acquisition thereof and was not created or made binding on such Equity Interests in contemplation of or in connection with the acquisition of

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such Subsidiary (provided that clause (2) shall not apply in the case of a joint venture), (B) that are excluded from clause (c) of the definition of Collateral and Guarantee Requirements or (C) that constitute Minority Investments to the extent such assets are not essential or material (as determined in good faith by the Canadian Borrower) for the operations of the Loan Parties and their Restricted Subsidiaries taken as a whole, (xvii) any assets acquired after the Closing Date, to the extent that, and for so long as, taking such actions would violate a contractual obligation binding on such assets (other than to the extent that such contractual obligation would be rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC, if applicable to such contractual obligation, or any successor provision or provisions or similar provisions of any applicable law) that existed at the time of the acquisition thereof and was not created or made binding on such assets in contemplation of or in connection with the acquisition of such assets (except in the case of assets acquired with Indebtedness permitted pursuant to Section 6.01 that is secured by a Lien permitted pursuant to Section 6.02), (xviii) any Subsidiary or real estate interest that is being dissolved or sold, as applicable, within one year of the Amendment No. 6 Effective Date and set forth on Schedule 5.10(e), such time to be extended in Administrative Agent’s sole discretion, (xix) Satellites not subject to the Lien created by the Security Documents and subject to agreements that are described in clause (26) of the definition of Permitted Liens and which the Collateral Agent (in its sole discretion) has not entered into a non-disturbance agreement as further described therein, (xx) any Subject Property; provided, however, that the exclusions pursuant to this clause (xx) shall not apply to the extent that any such prohibition, default or other term would be rendered ineffective pursuant to Section 9-406, 9-407, 9-408 or 9-409 of the UCC, or any successor provision or provisions or similar provisions of any applicable law; and provided, further, that the Security Interest shall attach immediately to any portion of such Subject Property that does not result in any of the consequences specified above including, without limitation, any Proceeds of such Subject Property, and (xxi) any property to the extent a security interest in such property would result in material adverse tax consequences to the Canadian Borrower or any Subsidiary of the Canadian Borrower as reasonably determined by the Canadian Borrower in consultation with (but without requiring the consent of) the Collateral Agent. Notwithstanding the Collateral and Guarantee Requirements or the other provisions of this Section 5.10, (i) any Person organized under the laws of Canada or the United States (or any political subdivision thereof) shall not be required to take any actions outside of the United States and Canada to perfect the security interest in any assets of any such Person (including registered intellectual property) located outside of the United States and Canada, (ii) each Loan Party (other than any Loan Party organized under the laws of Canada or the United States (or any political subdivision thereof)) shall not be required to take any actions outside of its jurisdiction of organization to perfect the security interest in any assets of such Person (including registered intellectual property) located outside of such Person’s jurisdiction of organization, and (iii) other than the Loan Parties’ pledge of their equity interest in their Subsidiaries organized in Isle of Man and Brazil (to the extent required), if a Subsidiary organized outside of the United States and Canada is excluded from being a Guarantor because it is not a Material Subsidiary (“Excluded Foreign Subsidiary”), the Loan Parties shall not be required to grant or perfect their pledge of such equity interest in the Excluded Foreign Subsidiary under any law other than the laws of the United States or Canada. The Collateral Agent agrees that its lien (which the Collateral Agent shall be permitted to release at any time in its sole discretion) on the Satellite (as defined in the APT Satellite Agreement) is subject to the rights of APT under the APT Satellite Agreement (as defined therein) and does not encompass the Excluded APT Elements.

(f) Notwithstanding the foregoing provisions of this Section 5.10 or anything in this Agreement or any other Loan Document to the contrary, (i) the foregoing provisions of this Section 5.10 and the Collateral and Guarantee Requirements shall not require the creation or perfection of pledges of or security interests in, or the obtaining of title insurance, legal opinions or other deliverables with respect to, particular assets of the Loan Parties, or the provision of Guarantees by any Subsidiary, if, and for so long as the Administrative Agent and the Canadian Borrower reasonably agree that the cost of creating or perfecting such pledges or security interests in such assets, or obtaining such title insurance, legal opinions or other deliverables in respect of such assets, or providing such Guarantees (taking into account any adverse tax consequences to the Canadian Borrower and its Affiliates (including the imposition of withholding or other material taxes)), shall be excessive in view of the benefits to be obtained by the Lenders therefrom, (ii) Liens required to be granted from time to time pursuant to the term “Collateral and Guarantee Requirement” shall be subject to exceptions and limitations set forth herein and in the Security Documents and (iii) in no event shall control agreements or other control or similar arrangements be required with respect to deposit accounts, securities accounts, commodity accounts, letter of credit rights or other assets requiring perfection by control (other than, for the avoidance of doubt, delivery of certificates or other instruments to the extent otherwise required by any Loan Document). The Collateral Agent may grant extensions of time for the creation and perfection of security interests in or the obtaining of title insurance, legal opinions or other deliverables with respect to particular assets or the provision of any Guarantee by any Subsidiary.

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ARTICLE VI

NEGATIVE COVENANTS

Each of the Loan Parties covenants and agrees with each Lender that so long as this Agreement shall remain in effect and until the Commitments have been terminated and the principal of and interest on each Loan, all Fees and all other expenses or amounts payable under any Loan Document shall have been paid in full (other than contingent amounts not yet due) and all Letters of Credit have been canceled or have expired and all amounts drawn thereunder have been reimbursed in full, unless the Required Lenders shall otherwise consent in writing, the following covenants shall apply.

Section 6.01 Limitation on Incurrence of Indebtedness. The Canadian Borrower will not, and will not permit any Restricted Subsidiary to, directly or indirectly, incur any Indebtedness (including Acquired Indebtedness) and the Canadian Borrower will not permit any Restricted Subsidiary to issue any shares of preferred stock; provided, however, that the Borrowers may incur Indebtedness (including Acquired Indebtedness), any Restricted Subsidiary may incur Indebtedness and issue shares of preferred stock (including Acquired Indebtedness) if as of the date any such Indebtedness is incurred or preferred stock is issued, on a pro forma basis after giving effect to the incurrence and application of the proceeds of such Indebtedness, the Canadian Borrower’s Total Leverage Ratio for the Test Period immediately preceding such date shall be less than or equal to 4.50 to 1.00; provided, further that the aggregate principal amount (or liquidation preference) of Indebtedness incurred or preferred stock issued pursuant to the foregoing together with any Refinancing Indebtedness in respect thereof incurred pursuant to clause (n) of the definition of Permitted Debt and amounts under clauses (a), (i) and (o) of the definition of Permitted Debt (together with any Refinancing Indebtedness in respect thereof incurred pursuant to clause (n) below) by Restricted Subsidiaries that are not Guarantors shall not exceed the greater of $300,000,000 and 6.5% of Total Assets at any time outstanding.

The foregoing limitations will not apply to (“Permitted Debt”):

(a) Indebtedness arising under the Loan Documents and any Credit Agreement Refinancing Indebtedness incurred to Refinance (in whole or in party) such Indebtedness (including successive refinancings) and any Permitted Additional Debt not otherwise permitted under this Section 6.01, which such Permitted Additional Debt is secured by Liens on the Collateral having a priority ranking equal or junior to the priority of the Liens on the Collateral securing the Secured Obligations; provided, with respect to such Permitted Additional Debt that (A) both immediately prior to and after giving effect thereto, no Event of Default shall exist or result therefrom and (B) the aggregate principal amount, determined as of the date of the incurrence of such Indebtedness and giving pro forma effect thereto and the use of the proceeds thereof, shall not, together with the aggregate principal amount of Incremental Term Loans and Incremental Revolving Credit Commitment Increases incurred and outstanding pursuant to Section 2.21(b), exceed, except as contemplated by the definition of “Permitted Refinancing Indebtedness”, the sum of (x) the amounts set forth under clauses (x) and (y) of the Incremental Limit, (y) in the case of Indebtedness that is secured by Liens on the Collateral equally and ratably with the Secured Obligations, an amount such that, after giving pro forma effect to the incurrence of any such Indebtedness and any Specified Transaction to be consummated in connection therewith, the Canadian Borrower shall be in compliance on a pro forma basis with a First Lien Leverage Ratio which shall not exceed 3.50 to 1.00 and (z) in the case of Indebtedness that shall rank junior in priority to the Liens on the Collateral securing the Secured Obligations, an amount such that, after giving pro forma effect to the incurrence of any such Indebtedness and any Specified Transaction to be consummated in connection therewith, the Canadian Borrower shall be in compliance on a pro forma basis with a Senior Secured Leverage Ratio which shall not exceed 4.25 to 1.00; provided, further that the aggregate principal amount (or liquidation preference) of Indebtedness incurred or preferred stock issued pursuant to the foregoing together with any Refinancing Indebtedness in respect thereof incurred pursuant to clause (n) of the definition of Permitted Debt and amounts under the first paragraph of this Section 6.01 and clauses (i) and (o) of the definition of Permitted Debt (together with any Refinancing Indebtedness in respect thereof incurred pursuant to clause (n) below) by Restricted Subsidiaries that are not Guarantors shall not exceed the greater of $300,000,000 and 6.5% of Total Assets at any time outstanding;

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(b) the incurrence by the Borrowers and any Guarantor of Indebtedness represented by the Senior Notes or Senior Secured Notes (including any Guarantee);

(c) Existing Indebtedness (other than Indebtedness described in clauses (a) and (b)), which in the case of such Existing Indebtedness with a principal amount in excess of $10,000,000 is set forth on Schedule 6.01;

(d) Indebtedness (including Finance Lease Obligations and Indebtedness related to a Sale Leaseback) and preferred stock incurred by the Canadian Borrower or any of its Restricted Subsidiaries, to finance the purchase, lease, construction or improvement (including, without limitation, the cost of design, development, construction, acquisition, transportation, installation, improvement and migration) of property (real or personal) or equipment that is used or useful in a Similar Business, whether through the direct purchase of assets or the Capital Stock of any Person owning such assets, in an aggregate principal amount which, when aggregated with the principal amount of all other Indebtedness and preferred stock then outstanding and incurred pursuant to this clause (d) and including all Refinancing Indebtedness incurred to refund, refinance or replace any other Indebtedness and preferred stock incurred pursuant to this clause (d), does not exceed the greater of (x) $150,000,000 and (y) 3.25% of Total Assets at the time of incurrence;

(e) Indebtedness incurred by the Canadian Borrower or any Restricted Subsidiary constituting reimbursement obligations with respect to letters of credit issued in the ordinary course of business, including letters of credit in respect of workers’ compensation claims, or other Indebtedness with respect to reimbursement type obligations regarding workers’ compensation claims; provided, however, that upon the drawing of such letters of credit or the incurrence of such Indebtedness, such obligations are reimbursed within 30 days following such drawing or incurrence;

(f) Indebtedness arising from agreements of the Canadian Borrower or a Restricted Subsidiary providing for indemnification, adjustment of purchase price or similar obligations, in each case, incurred or assumed in connection with the acquisition or disposition of any business, assets or a Subsidiary, other than guarantees of Indebtedness incurred by any Person acquiring or disposing of all or any portion of such business, assets or a Subsidiary for the purpose of financing such acquisition; provided, however, that

(i) such Indebtedness is not to be reflected on the balance sheet of the Canadian Borrower or any Restricted Subsidiary prepared in accordance with GAAP (contingent obligations referred to in a footnote to financial statements and not otherwise reflected on the balance sheet will not be deemed to be reflected on such balance sheet for purposes of this clause (f)(i)) and

(ii) the maximum assumable liability in respect of all such Indebtedness shall at no time exceed the gross proceeds including non-cash proceeds (the Fair Market Value of such non-cash proceeds being measured at the time received and without giving effect to any subsequent changes in value) actually received by the Canadian Borrower and the Restricted Subsidiaries in connection with such disposition;

(g) Indebtedness (including Indebtedness related to a Sale Leaseback) or preferred stock of the Canadian Borrower to a Restricted Subsidiary; provided that any such Indebtedness owing to a Restricted Subsidiary that is not a Guarantor is subordinated in right of payment to the Obligations; provided, further that any subsequent issuance or transfer of any Capital Stock or any other event which results in any such Restricted Subsidiary ceasing to be a Restricted Subsidiary or any other subsequent transfer of any such Indebtedness (except to the Canadian Borrower or another Restricted Subsidiary) shall be deemed in each case to be an incurrence of such Indebtedness;

(h) Indebtedness (including Indebtedness related to a Sale Leaseback) or preferred stock of a Restricted Subsidiary to the Canadian Borrower or another Restricted Subsidiary; provided that

(i) any such Indebtedness is made pursuant to an intercompany note, and

(ii) if a Guarantor incurs such Indebtedness owing to a Restricted Subsidiary that is not a Guarantor such Indebtedness is subordinated in right of payment to the Guarantee of such Guarantor;

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provided, further that any subsequent transfer of any such Indebtedness (except to the Canadian Borrower or another Restricted Subsidiary) shall be deemed in each case to be an incurrence of such Indebtedness;

(i) Indebtedness or preferred stock of Restricted Subsidiaries that are not Guarantors; provided, however, that the aggregate principal amount of Indebtedness or liquidation preference of preferred stock incurred under this clause (i), when aggregated with the principal amount of all other Indebtedness then outstanding and incurred pursuant to this clause (i) and any refinancings in respect of any of the foregoing (including any Refinancing Indebtedness incurred pursuant to clause (n) below), does not exceed the greater of $120,000,000 and 2.75% of Total Assets at the time of incurrence; provided, further that the aggregate principal amount (or liquidation preference) of Indebtedness incurred or preferred stock issued pursuant to this clause (i) together with such amounts incurred or issued by Restricted Subsidiaries that are not Guarantors pursuant to the first paragraph of this Section 6.01 and clauses (a) and (o) of the definition of Permitted Debt and any Refinancing Indebtedness in respect of the foregoing incurred pursuant to clause (n) below) shall not exceed the greater of $300,000,000 and 6.5% of Total Assets at any one time outstanding;

(j) (x) Swap Obligations entered into for bona fide (non-speculative) business purposes and (y) Indebtedness in respect of Cash Management Obligations;

(k) obligations in respect of performance, bid, appeal and surety bonds and completion guarantees provided by the Canadian Borrower or any Restricted Subsidiary in the ordinary course of business, including guarantees or obligations of the Canadian Borrower or any Restricted Subsidiary with respect to letters of credit supporting such performance, bid, appeal or surety obligations (in each case other than for an obligation for money borrowed);

(l) (i) Indebtedness or preferred stock of the Borrowers or any Guarantor not otherwise permitted hereunder in an aggregate principal amount or liquidation preference of 100% of the net cash proceeds received by the Canadian Borrower since the Measurement Date from the issue or sale of Equity Interests of the Canadian Borrower or cash contributed to the capital of the Canadian Borrower (in each case, other than Excluded Contributions or sales of Equity Interests to the Canadian Borrower or any of its Subsidiaries) as determined in accordance with clauses (B)(1) and (B)(2) of the definition of Applicable Amount to the extent such net cash proceeds or cash have not been applied pursuant to such clauses to make Restricted Payments or to make other Investments, payments or exchanges pursuant to Section 6.06(b) or to make Permitted Investments (other than Permitted Investments specified in clauses (1), (2) and (3) of the definition thereof) and (ii) Indebtedness or preferred stock of the Borrowers or any Guarantor not otherwise permitted hereunder in an aggregate principal amount or liquidation preference, which when aggregated with the principal amount and liquidation preference of all other Indebtedness or preferred stock then outstanding and incurred pursuant to this clause (l)(ii) together with any Refinancing Indebtedness in respect thereof incurred pursuant to clause (n) below, does not at any one time outstanding exceed the greater of (x) $200,000,000 or (y) 4.5% of Total Assets as of the time of incurrence (it being understood that any Indebtedness or preferred stock incurred pursuant to this clause (l)(ii) shall cease to be deemed incurred or outstanding for purposes of this clause (l)(ii) but shall be deemed incurred for the purposes of the first paragraph of this Section 6.01 from and after the first date on which the Borrowers or such Guarantor could have incurred such Indebtedness under the first paragraph of this Section 6.01 without reliance on this clause (l)(ii));

(m) Indebtedness or preferred stock incurred in connection with project financings and export credit financings (it being understood that the Canadian Borrower may determine in good faith the purpose for which Indebtedness was incurred) and any refinancing, refunding, renewal or extension of any such Indebtedness; provided that the aggregate amount of Indebtedness or preferred stock incurred pursuant to this clause (m) together with any Refinancing Indebtedness in respect thereof incurred pursuant to clause (n) below shall not exceed the greater of $700,000,000 and 15.1% of Total Assets at any time outstanding;

(n) the incurrence by the Canadian Borrower or any Restricted Subsidiary of Indebtedness or preferred stock which serves to refund or refinance any Indebtedness or preferred stock incurred as permitted under the first paragraph of this Section 6.01 and clauses (b), (c), (d), (i), (l)(b) and (m) above, this clause (n) and clause (o) below or any Indebtedness or preferred stock issued to so refund or refinance such Indebtedness or preferred stock including additional Indebtedness or preferred stock incurred to pay accrued but unpaid interest, dividends,

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premiums (including tender premiums), defeasance costs, underwriting discounts, fees, costs and expenses (including original issue discount, upfront fees or similar fees) incurred in connection with such refinancing (the “Refinancing Indebtedness”) prior to its respective maturity; provided, however, that such Refinancing Indebtedness

(i) has a Weighted Average Life to Maturity at the time such Refinancing Indebtedness is incurred that is not less than the remaining Weighted Average Life to Maturity of the Indebtedness being refunded or refinanced,

(ii) to the extent such Refinancing Indebtedness refinances Subordinated Indebtedness, such Refinancing Indebtedness is subordinated to the Obligations or such Guarantee at least to the same extent as the Indebtedness being refinanced or refunded; provided that this subclause (ii) need not be satisfied if the amount of such Refinancing Indebtedness shall not exceed the Applicable Amount (it being understood that if amounts available under the Applicable Amount are used to refinance such Subordinated Indebtedness, then the Applicable Amount shall be reduced by such amount), and

(iii) shall not include

(A) Indebtedness of a Subsidiary of the Canadian Borrower that refinances Indebtedness of the Canadian Borrower,

(B) Indebtedness of a Subsidiary of the Canadian Borrower that is not a Guarantor or a Borrower that refinances Indebtedness of a Guarantor or a Borrower or

(C) Indebtedness of the Canadian Borrower or a Restricted Subsidiary that refinances Indebtedness of an Unrestricted Subsidiary;

(o) (i) Indebtedness or preferred stock of Persons that are acquired by the Canadian Borrower or any Restricted Subsidiary or consolidated, amalgamated or merged with or into or wound up into a Restricted Subsidiary in accordance with the terms of this Agreement, provided that in the case of this clause (o)(i) immediately and after giving effect to such acquisition, amalgamation, consolidation, winding up or merger either (A) the Canadian Borrower would be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Total Leverage Ratio set forth in the first paragraph of this Section 6.01 or (B) the Canadian Borrower’s Total Leverage Ratio is less than or equal to the amount thereof immediately prior to such acquisition, amalgamation or merger; or

(ii) Indebtedness or preferred stock incurred in connection with or in contemplation of the acquisition of Persons that are acquired by the Canadian Borrower or any Restricted Subsidiary or consolidated, amalgamated or merged with or into or wound up into a Restricted Subsidiary in accordance with the terms of this Agreement; provided that in the case of this subclause (ii) immediately after giving effect to such acquisition, consolidation, amalgamation or merger either (A) the Canadian Borrower would be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Total Leverage Ratio set forth in the first paragraph of this Section 6.01 or (B) the Canadian Borrower’s Total Leverage Ratio is less than or equal to the amount thereof immediately prior to such acquisition, consolidation, amalgamation or merger;

provided, that the principal amount of any such Indebtedness and liquidation preference of any such preferred stock of any Restricted Subsidiaries that are not Guarantors permitted to remain outstanding pursuant to this subclause (o) together with the aggregate principal amount of Indebtedness incurred and liquidation preference of preferred stock issued in each case by Restricted Subsidiaries that are not Guarantors pursuant to the first paragraph of this Section 6.01, subclause (i) above or any Refinancing Indebtedness incurred pursuant to clause (n) above in respect of amounts incurred or issued by Restricted Subsidiaries that are not Guarantors under this clause (o) or the first paragraph of this Section 6.01 and clauses (a) and (i) of the definition of Permitted Debt shall not exceed an amount of the greater of $300,000,000 and 6.50% of Total Assets at any one time outstanding;

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(p) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business, provided that such Indebtedness is extinguished within two Business Days of its incurrence;

(q) Indebtedness of the Canadian Borrower or any Restricted Subsidiary supported by a Letter of Credit, in a principal amount not in excess of the stated amount of such Letter of Credit;

(r)

(i) any guarantee by the Borrowers or a Guarantor of Indebtedness or other obligations of any Restricted Subsidiary so long as the incurrence of such Indebtedness incurred by such Restricted Subsidiary is permitted under the terms of this Agreement,

(ii) any guarantee by a Restricted Subsidiary of Indebtedness of the Borrowers or any Guarantor; provided that such guarantee is incurred in accordance with Section 6.10;

(s) (i) Mezzanine Securities issued pursuant to Section 6.12(b)(xii)(A) or existing as of the Measurement Date, including pay-in-kind interest payments issued thereon, in each case in accordance with the terms of the Mezzanine Securities as in effect on the Measurement Date; and (ii) any refinancings of the foregoing so long as (x) the principal amount of such refinancing shall not exceed the principal amount of such Mezzanine Securities being refinanced together with any accrued interest and fees (including any amendment or consent fees thereon) and (y) such refinancing shall, as determined by the Canadian Borrower in good faith, have terms material to the interests of the Lenders no materially less advantageous to the Lenders than the existing terms of such Mezzanine Securities being refinanced; and

(t) the incurrence of additional Indebtedness or other obligations by the Canadian Borrower not otherwise permitted under this Section 6.01; provided that such Indebtedness or other obligations (x) satisfy the definition of Dividend Obligations, (y) do not bear any interest (in the form of accretion, PIK, cash or otherwise) and (z) shall not result in a decline in the rating of the Term B-5 Loans or the corporate family rating of Canadian Borrower by any Rating Agency by at least one notch in the gradation of the rating scale (e.g., + or – for S&P or 1, 2 and 3 for Moody’s) or of the credit outlook with respect thereto from such Rating Agency’s rating of the Loans or the corporate family rating of Canadian Borrower.

For purposes of determining compliance with this Section 6.01:

(i) in the event that an item of Indebtedness or preferred stock meets the criteria of more than one of the categories of permitted Indebtedness or preferred stock described in clauses (a) through (t) above or is entitled to be incurred pursuant to the first paragraph of this Section 6.01, the Canadian Borrower, in its sole discretion, will classify or reclassify such item of Indebtedness or preferred stock (or any portion thereof) and will only be required to include the amount and type of such Indebtedness or preferred stock in one of the above clauses;

(ii) at the time of incurrence, the Canadian Borrower will be entitled to divide and classify an item of Indebtedness or preferred stock in more than one of the types of Indebtedness or preferred stock described above;

(iii) the principal amount of Indebtedness or preferred stock outstanding under any clause of this Section 6.01 shall be determined after giving effect to the application of proceeds of any such Indebtedness or preferred stock; and

(iv) the U.S. dollar equivalent principal amount of Indebtedness or preferred stock denominated in a foreign currency shall be calculated based on the relevant currency exchange rate in effect on the date such Indebtedness or preferred stock was incurred, in the case of term debt, or first committed or first incurred (whichever yields the lower U.S. dollar equivalent), in the case of revolving credit debt; provided that (x) if such Indebtedness or preferred stock is incurred to refinance other Indebtedness or

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preferred stock denominated in the same foreign currency, and such refinancing would cause the applicable U.S. dollar-denominated restriction to be exceeded if calculated at the relevant currency exchange rate in effect on the date of such refinancing, such U.S. dollar-denominated restriction shall be deemed not to have been exceeded so long as the principal amount in such currency of such refinancing Indebtedness or preferred stock does not exceed the principal amount in such currency of such Indebtedness or preferred stock being refinanced, plus the aggregate amount of accrued but unpaid interest, dividends, premiums (including tender premiums), defeasance costs, underwriting discounts, fees, costs and expenses (including original issue discount, upfront fees or similar fees) incurred in connection with such refinancing and (y) if such Indebtedness or preferred stock is incurred to refinance other Indebtedness or preferred stock denominated in a different currency from the Indebtedness or preferred stock being refinanced, the principal amount of any such Indebtedness or preferred stock shall be calculated based on the currency exchange rate applicable to the currencies in which such respective Indebtedness or preferred stock is denominated that is in effect on the date of such refinancing.

Accrual of interest, the accretion of accreted value, the accretion or amortization of original issue discount and the payment of interest or dividends in the form of additional Indebtedness or preferred stock will not be deemed to be an incurrence of Indebtedness or preferred stock for purposes of this Section 6.01. If Indebtedness or preferred stock originally incurred in reliance upon a percentage of Total Assets under this covenant is being refinanced and such refinancing would cause the maximum amount of Indebtedness or preferred stock thereunder to be exceeded at such time, then such refinancing will nevertheless be permitted thereunder and such additional Indebtedness or preferred stock will be deemed to have been incurred under the applicable provision so long as the principal amount or liquidation preference of such refinancing Indebtedness or preferred stock does not exceed the principal amount or liquidation preference of Indebtedness or preferred stock being refinanced plus amounts permitted by the next sentence. Any Indebtedness or preferred stock permitted to be incurred to refinance Indebtedness or preferred stock above shall be permitted to include additional Indebtedness or preferred stock incurred to pay accrued but unpaid interest, dividends, premiums (including tender premiums), defeasance costs, underwriting discounts, fees, costs and expenses (including original issue discount, upfront fees or similar fees) incurred in connection with such refinancing.

Section 6.02 Limitation on Liens. The Canadian Borrower will not, and will not permit any Restricted Subsidiary to, directly or indirectly, create, incur, assume or suffer to exist any Lien (except Permitted Liens) of any kind (any such Lien, the “Initial Lien”) that secures any obligations under any Indebtedness of the Canadian Borrower or a Restricted Subsidiary against or on any asset or property now owned or hereafter acquired by the Canadian Borrower or any such Restricted Subsidiary, or any income or profits therefrom, or assign or convey any right to receive income therefrom, except, in the case of any assets that do not constitute Collateral, any Initial Lien if the Secured Obligations of the Canadian Borrower or such Restricted Subsidiary (as applicable), if any, are secured equally and ratably with or prior to such Initial Liens.

Section 6.03 Merger, Consolidation or Sale of All or Substantially All Assets.

(a) The Canadian Borrower may not consolidate, amalgamate or merge with or into or wind up into (whether or not the Canadian Borrower is the surviving Person), or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties or assets in one or more related transactions, to any Person unless:

(i) the Canadian Borrower is the surviving, resulting or continuing Person, or the Person formed by, continuing or resulting from or surviving any such consolidation, amalgamation, merger or winding up (if other than the Canadian Borrower) or to which such sale, assignment, transfer, lease, conveyance or other disposition will have been made is a corporation, limited liability company or partnership organized or existing under the laws of Canada, any province or territory thereof, the United States, any state thereof or the District of Columbia (such Person, as the case may be, being herein called the “Successor Company”); provided that, if the Successor Company is a limited liability company or partnership, then such Successor Company shall have a co-borrower that is a corporation organized or existing under the laws of Canada, any province or territory thereof, the United States, any state thereof or the District of Columbia;

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(ii) the Successor Company, if other than the Canadian Borrower, expressly assumes all the obligations of the Canadian Borrower under this Agreement pursuant to joinder documentation in form and substance reasonably satisfactory to the Administrative Agent;

(iii) immediately after such transaction no Default or Event of Default exists;

(iv) immediately after giving pro forma effect to such transaction, as if such transaction had occurred at the beginning of the applicable Test Period, (A) the Successor Company would be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Total Leverage Ratio test set forth in the first paragraph of Section 6.01 or (B) the Total Leverage Ratio for the Successor Company and the Restricted Subsidiaries would be equal to or less than such Total Leverage Ratio for the Canadian Borrower and the Restricted Subsidiaries immediately prior to such transaction;

(v) each Guarantor, unless it is the other party to the transactions described above, in which case clause (2) of the second to last paragraph of this Section 6.03(a) shall apply, shall have confirmed in writing that its Guarantee shall apply to such Person’s obligations under this Agreement; and

(vi) the Canadian Borrower shall have delivered to the Administrative Agent an officer’s certificate and opinion of counsel, each stating that such consolidation, amalgamation, merger, winding up, sale, assignment, transfer, lease, conveyance or other disposition and such supplemental indentures, if any, comply with this Agreement.

For purposes of this Section 6.03, any Indebtedness of the Successor Company which was not Indebtedness of the Canadian Borrower immediately prior to the transaction shall be deemed to have been incurred in connection with such transaction.

The Successor Company will succeed to, and be substituted for, the Canadian Borrower under this Agreement (and all references to the Canadian Borrower will be deemed references to the Successor Company, unless the context otherwise requires) and the Canadian Borrower will automatically be released and discharged from its obligations under this Agreement. For purposes of the foregoing, the transfer (by lease, assignment, sale or otherwise, in a single transaction or series of transactions) of all or substantially all of the properties or assets of one or more Restricted Subsidiaries, the Equity Interests of which constitute all or substantially all of the properties and assets of the Canadian Borrower will be deemed to be the transfer of all or substantially all of the properties and assets of the Canadian Borrower.

(b) Subject to Section 10.09 hereof, no Guarantor nor the U.S. Borrower will, and the Canadian Borrower will not permit any Guarantor or the U.S. Borrower to, consolidate, amalgamate or merge with or into or wind up into (whether or not such Guarantor or the U.S. Borrower is the surviving Person), or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties or assets in one or more related transactions to, any Person unless:

(A) (i) (x) such Guarantor or the U.S. Borrower, as applicable, is the surviving, resulting or continuing Person or (y) the Person formed by, continuing or resulting from or surviving any such consolidation, amalgamation, merger or winding up (if other than such Guarantor or the U.S. Borrower, as applicable) or to which such sale, assignment, transfer, lease, conveyance or other disposition will have been made is a corporation, limited liability company or partnership organized or existing under the laws of Canada, any province or territory thereof (except that in the case of the U.S. Borrower, such surviving Person shall be organized or existing under the laws of the United States, any state thereof, the District of Columbia, or any territory thereof) (such Guarantor or the U.S. Borrower or such Person, as the case may be, being herein called the “Successor Person”) (provided that, in the case of this subclause (y), if the Guarantor or U.S. Borrower, as applicable, that is not the Successor Person of such transaction (a “Non-Successor Person”) had, immediately prior to such transaction, been formed, organized or existing under the laws of a jurisdiction other than those referenced immediately above and/or existed in or was organized as a legal entity other than a corporation, limited liability company or partnership, then the Successor Person of such transaction may be formed, organized or existing under the laws of the same

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jurisdiction as such Non-Successor Person had then been and may be of the same corporate or other organizational type as such Non-Successor Person had then been);

(vii) the Successor Person, if other than such Guarantor or the U.S. Borrower, as applicable, expressly assumes all the obligations of such Guarantor or the U.S. Borrower, as applicable, under this Agreement and, in the case of a Guarantor, such Guarantor’s Guarantee, pursuant to joinder documentation in form and substance reasonably satisfactory to the Administrative Agent;

(viii) immediately after such transaction no Default or Event of Default exists; and

(ix) the Canadian Borrower shall have delivered to the Administrative Agent an officer’s certificate and opinion or counsel, each stating that such consolidation, merger, winding up, sale, assignment, transfer, lease, conveyance or other disposition and such supplemental indentures, if any, comply with this Agreement; or

(B) in the case of a Guarantor, the transaction is made in compliance with Section 6.04.

Subject to Section 10.09 hereof, the Successor Person will succeed to, and be substituted for, such Guarantor or the U.S. Borrower, as applicable, under this Agreement and such Guarantor’s Guarantee (and references to such Guarantor or the U.S. Borrower, as applicable, will be deemed references to the Successor Person, unless the context requires otherwise), as applicable, and such Guarantor will automatically be released and discharged from its obligations under this Agreement and such Guarantor’s Guarantee. Notwithstanding the foregoing, any Guarantor may merge into, amalgamate or consolidate with, wind up into or sell, assign, transfer, lease, convey or otherwise dispose of all or part of its properties and assets to another Guarantor or the Canadian Borrower.

Notwithstanding anything to the contrary in this Agreement:

(1) any Restricted Subsidiary may consolidate, amalgamate with, merge into or transfer all or part of its properties and assets to the Canadian Borrower or any Guarantor;

(2) the Canadian Borrower, the U.S. Borrower or any Guarantor may merge or amalgamate with an Affiliate of the Canadian Borrower solely for the purpose of reincorporating the Canadian Borrower, the U.S. Borrower or such Guarantor in another jurisdiction of the United States or Canada so long as the amount of Indebtedness of the Canadian Borrower and the Restricted Subsidiaries is not increased thereby; and

(3) The Canadian Borrower and any of its direct or indirect parent companies, if any, may combine (whether by consolidation, amalgamation, merger or otherwise) if the beneficial owners of the Canadian Borrower’s Voting Stock and the resulting or continuing entity’s Voting Stock are the persons set forth in clauses (i), (ii), (iii), (x) (as it relates to clause (i), (ii) or (iii)), or (xi) of the definition of “Permitted Holders” and the aggregate principal amount of Indebtedness of the resulting or continuing entity is no greater than that of the Canadian Borrower immediately prior thereto or is permitted to be incurred under Section 6.01.

(c) Upon any consolidation, amalgamation, merger or winding up, or any sale, assignment, transfer, lease, conveyance or disposition of all or substantially all of the assets or properties of the Canadian Borrower, U.S. Borrower or any Guarantor in accordance with Sections 6.03(a) and 6.03(b) hereof, the successor Person formed by such consolidation or into which the Canadian Borrower, U.S. Borrower or such Guarantor, as the case may be, is merged or would up into or the successor Person to which such sale, assignment, transfer, lease, conveyance or disposition is made, shall succeed to, and be substituted for, and may exercise every right and power of, the Canadian Borrower, U.S. Borrower or such Guarantor, as the case may be, under this Agreement or the Guarantees, as the case may be, with the same effect as if such successor Person had been named as the Canadian Borrower, U.S. Borrower or such Guarantor, as the case may be, herein or the Guarantees, as the case may be. When a successor Person assumes all obligations of its predecessor hereunder or the Guarantees, as the case may be, such predecessor

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shall be released from all obligations; provided that in the event of a lease, the predecessor shall not be released from the payment of principal and interest or other obligations under this Agreement or the Guarantees, as the case may be.

Section 6.04 Limitation on Sale of Assets.

The Canadian Borrower will not, and will not permit any Restricted Subsidiary to, cause, make or suffer to exist an Asset Sale, unless:

(a) the Canadian Borrower or such Restricted Subsidiary, as the case may be, receives consideration at the time of such Asset Sale at least equal to the Fair Market Value (measured at the time of contractually agreeing to such Asset Sale) of the assets sold or otherwise disposed of; and

(b) except in the case of a Permitted Asset Swap, at least 75% of the consideration therefor received by the Canadian Borrower or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; provided that the amount of:

(i) any liabilities (as shown on the Canadian Borrower’s, or such Restricted Subsidiary’s, most recent balance sheet or in the footnotes thereto or if incurred, accrued or increased subsequent to the date of such balance sheet, such liabilities that would have been reflected on the Canadian Borrower’s or such Restricted Subsidiary’s balance sheet or in the footnotes thereto if such incurrence, accrual or increase had taken place on or prior to the date of such balance sheet, as determined by the Canadian Borrower) of the Canadian Borrower or any Restricted Subsidiary, other than liabilities that are by their terms subordinated in right of payment to the Obligations, that are assumed by the transferee of any such assets (or are directly associated with such assets and are otherwise extinguished in connection with the transactions relating to such Asset Sale) and for which the Canadian Borrower and all Restricted Subsidiaries have been unconditionally released by all creditors or their representatives in writing,

(ii) any notes or other obligations or securities or assets received by the Canadian Borrower or such Restricted Subsidiary from such transferee that are converted by the Canadian Borrower or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash or Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Sale, and

(iii) any Designated Non-cash Consideration received by the Canadian Borrower or any Restricted Subsidiary in such Asset Sale having an aggregate Fair Market Value, taken together with all other Designated Non-cash Consideration received pursuant to this subclause (iii) that is at that time outstanding, not to exceed an amount equal to the greater of $120,000,000 or 2.75% of Total Assets at the time of the receipt of such Designated Non-cash Consideration, with the Fair Market Value of each item of Designated Non-cash Consideration being measured at the time received and without giving effect to subsequent changes in value,

shall be deemed to be Cash Equivalents for purposes of this provision and for no other purpose.

Section 6.05 [Reserved].

Section 6.06 Limitation on Restricted Payments. (a) The Canadian Borrower will not, and will not permit any Restricted Subsidiary to, directly or indirectly:

(i) declare or pay any dividend or make any distribution on account of the Canadian Borrower’s or any Restricted Subsidiary’s Equity Interests, including any dividend or distribution payable on account of the Canadian Borrower’s or any Restricted Subsidiary’s Equity Interests in connection with any merger or consolidation other than:

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(A) dividends or distributions by the Canadian Borrower payable in Equity Interests (other than Disqualified Capital Stock) of the Canadian Borrower or in options, warrants or other rights to purchase such Equity Interests, or

(B) dividends or distributions by a Restricted Subsidiary so long as, in the case of any dividend or distribution payable on or in respect of any class or series of securities issued by a Subsidiary other than a Wholly Owned Subsidiary, the Canadian Borrower or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution in accordance with its Equity Interests in such class or series of securities;

(ii) purchase, redeem, defease or otherwise acquire or retire for value any Equity Interests of the Canadian Borrower or any direct or indirect parent of the Canadian Borrower, including any dividend or distribution payable in connection with any merger, amalgamation or consolidation;

(iii) make any principal payment on, or redeem, repurchase, defease or otherwise acquire or retire for value in each case, prior to any scheduled repayment, sinking fund payment or maturity, any Subordinated Indebtedness, other than the purchase, repurchase or other acquisition of Subordinated Indebtedness purchased in anticipation of satisfying a sinking fund obligation, principal installment or final maturity, in each case due within one year of the date of purchase, repurchase or acquisition; or

(iv) make any Restricted Investment

(all such payments and other actions set forth in clauses (i) through (iv) above being collectively referred to as “Restricted Payments”), unless, at the time of such Restricted Payment:

(1) no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof;

(2) the Canadian Borrower can incur at least $1.00 of additional Indebtedness pursuant to the provisions of the first paragraph of Section 6.01; and

(3) such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by the Canadian Borrower and its Restricted Subsidiaries after the Measurement Date (including Restricted Payments permitted by Sections 6.06(b)(i), (b)(v) and (b)(xvii), but excluding all other Restricted Payments permitted by Section 6.06(b)), is less than the Applicable Amount.

(b) The foregoing provisions will not prohibit:

(i) the payment of any dividend or distribution or the consummation of any irrevocable redemption within 60 days after the date of declaration thereof or the giving of such irrevocable notice, as applicable, if, at the date of declaration or the giving of such notice, such payment would have complied with the provisions of this Agreement (assuming, in the case of a redemption payment, the giving of the notice of such redemption payment would have been deemed to be a Restricted Payment at such time);

(ii) the redemption, repurchase, retirement, defeasance or other acquisition of any Equity Interests (“Retired Capital Stock”) or Subordinated Indebtedness of the Canadian Borrower, in exchange for, or out of the proceeds of the substantially concurrent sale (other than to a Restricted Subsidiary) of, Equity Interests of the Canadian Borrower (in each case, other than any Disqualified Capital Stock) (“Refunding Capital Stock”);

(iii) the redemption, repurchase, defeasance, exchange or other acquisition or retirement of Subordinated Indebtedness of the Canadian Borrower or any Restricted Subsidiary made by exchange for, or out of the proceeds of the substantially concurrent sale of, new Indebtedness of the Canadian Borrower or any Restricted Subsidiary which is incurred in compliance with Section 6.01 so long as:

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(A) the principal amount (or accreted value, in the case of Indebtedness issued at a discount) of such new Indebtedness does not exceed the principal amount (or accreted value, if applicable) of the Subordinated Indebtedness being so redeemed, repurchased, acquired, defeased, exchanged or retired, plus the amount of any reasonable fees, expenses and premium incurred or paid in connection with such redemption, repurchase, acquisition, defeasance, exchange or retirement and the incurrence of such new Indebtedness;

(B) such new Indebtedness is subordinated to the Obligations at least to the same extent as such Subordinated Indebtedness so redeemed, repurchased, defeased, exchanged, acquired or retired; provided that this subclause (B) need not be satisfied if (1) such new Indebtedness can be incurred pursuant to the first paragraph of Section 6.01 or (2) the amount of such new Indebtedness shall not exceed the Applicable Amount (it being understood that if amounts available under the Applicable Amount are used to redeem, repurchase, defease, exchange, acquire or retire such Subordinated Indebtedness, then the Applicable Amount shall be reduced by such amounts);

(C) such new Indebtedness has a final scheduled maturity date equal to or later than the final scheduled maturity date of the Subordinated Indebtedness being so redeemed, repurchased, defeased, exchanged, acquired or retired;

(D) such new Indebtedness has a Weighted Average Life to Maturity at the time incurred which is not less than the shorter of (1) the remaining Weighted Average Life to Maturity of the Subordinated Indebtedness being so redeemed, repurchased, defeased, exchanged, acquired or retired and (2) the Weighted Average Life to Maturity that would result if all payments of principal on the Indebtedness being so redeemed, repurchased, defeased, acquired or retired that were due on or after the date one year following the Final Maturity Date were instead due on such date one year following the Final Maturity Date; and

(E) the obligor of such Indebtedness does not include any Person (other than the Borrowers or any Guarantor) that is not an obligor of the Indebtedness being so redeemed, repurchased, defeased, exchanged, acquired or retired;

(iv) a Restricted Payment to pay for the repurchase, redemption, retirement, defeasance or other acquisition of Equity Interests of the Canadian Borrower or any of its direct or indirect parent companies held by any future, present or former employee, director, officer or consultant of the Canadian Borrower, any of its Subsidiaries or any of its direct or indirect parent companies pursuant to any management equity plan or stock option plan or any other management or employee benefit plan or agreement; provided, however, that the aggregate Restricted Payments made under this subclause (iv) do not exceed in any calendar year $15,000,000 (which shall increase to $30,000,000 subsequent to the consummation of a Qualified IPO) with unused amounts in any calendar year in an amount not to exceed $30,000,000 (which shall increase to $60,000,000 subsequent to the consummation of a Qualified IPO) being carried over to the succeeding calendar years; provided, further that such amount in any calendar year may be increased by an amount (without duplication of any increase in respect of any other calendar year) not to exceed:

(A) the cash proceeds from the sale of Equity Interests of the Canadian Borrower and, to the extent contributed to the Canadian Borrower, Equity Interests of any of the Canadian Borrower’s direct or indirect parent companies, in each case to members of management, directors or consultants of the Canadian Borrower, any of its Subsidiaries or any of its direct or indirect parent companies that occurs or occurred after the Measurement Date, to the extent the cash proceeds from the sale of such Equity Interests have not otherwise been applied to the payment of Restricted Payments by virtue of clause (B)(3) of the definition of the term “Applicable Amount”; plus

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(B) the cash proceeds of key man life insurance policies received by the Canadian Borrower (or any direct or indirect parent company of the Canadian Borrower to the extent contributed to the Canadian Borrower) and its Restricted Subsidiaries after the Measurement Date; less

(C) the amount of any Restricted Payments previously made since the Measurement Date pursuant to clauses (A) and (B) of this clause (iv);

and provided, furtherthat cancellation of Indebtedness owing to the Canadian Borrower, U.S. Borrower or any Guarantor from members of management of the Canadian Borrower, any of its direct or indirect parent companies or any Restricted Subsidiary in connection with a repurchase of Equity Interests of the Canadian Borrower or any of its direct or indirect parent companies will not be deemed to constitute a Restricted Payment for purposes of this Section 6.06 or any other provision of this Agreement;

(v) the declaration and payment of dividends or distributions to holders of any class or series of Disqualified Capital Stock of the Canadian Borrower or any other Restricted Subsidiary issued in accordance with Section 6.01 to the extent such dividends are included in the definition of Cumulative Interest Expense;

(vi) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants if such Equity Interests represent a portion of the exercise price or taxes payable in respect of such options or warrants;

(vii) Restricted Payments that are made with Excluded Contributions;

(viii) the repurchase, redemption or other acquisition of Equity Interests deemed to occur in connection with paying cash in lieu of fractional shares in connection with any dividend (including in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests), share split, reverse share split or combination thereof or any acquisition or other Investment and to honor any conversion request by a holder of convertible Indebtedness and make cash payments in lieu of fractional shares in connection with any such conversion and may make payments on convertible Indebtedness in accordance with its terms;

(ix) [reserved];

(x) the Canadian Borrower making and paying dividends:

(A) for any taxable period for which the Canadian Borrower is a member of a consolidated, combined, unitary or aggregate income tax group (a “Tax Group”) of which a direct or indirect parent company of the Canadian Borrower is the common parent, the proceeds of which shall be used to pay (or to make dividends to allow any parent entity of the Canadian Borrower to pay) any income Tax liability of such Tax Group in respect of taxable income attributable to the Canadian Borrower and its applicable Subsidiaries, but not in excess of the Tax liability that the Canadian Borrower would incur if it filed tax returns as the parent of a Tax Group for itself and its applicable Subsidiaries (and net of any payment already made and to be made by the Canadian Borrower or any of its Restricted Subsidiaries to a taxing authority to satisfy such Tax liability); provided that a dividend attributable to any Taxes attributable to an Unrestricted Subsidiary shall be permitted only to the extent such Unrestricted Subsidiary distributed cash to the Canadian Borrower or its Restricted Subsidiaries for such purpose; provided further that with respect to any taxable period or portion thereof ending prior to the Measurement Date, payments pursuant to this clause (A) shall be permitted only to the extent relating to Tax adjustments that arise after the Measurement Date as a result of audits or other Tax proceedings;

(B) the proceeds of which shall be used to pay (or to make dividends to allow any parent entity of the Canadian Borrower to pay) its operating expenses incurred in the ordinary

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course (including related to maintenance of organizational existence), general administrative costs and other overhead costs and expenses (including customary salary, bonus and other benefits payable to present or former officers and employees of any parent entity and administrative, legal, accounting, professional and similar fees and expenses provided by third parties, including the Canadian Borrower’s proportionate share of such amount relating to such parent entity being a public company, if applicable), plus any indemnification claims made by employees, managers, consultants, independent contractors, directors or officers of any parent entity of the Canadian Borrower; and

(C) the proceeds of which shall be used to pay (or to make dividends to allow any parent entity of the Canadian Borrower to pay) franchise, excise and similar taxes and other fees and expenses, in each case, required to maintain its (or any of its parent entities’) corporate or other legal existence;

(xi) Restricted Payments made to fund payments made in accordance with Sections 6.12(b)(vii) or 6.12(b)(xii); and

(xii) the declaration and payment of dividends or distributions to, or repurchase or redemption of shares from, the equity holders of the Canadian Borrower in an amount equal to the greater of (x) 6.0% per annum of the net proceeds received by the Canadian Borrower, as applicable, from any Qualified IPO and (y) 5.0% per annum of Market Capitalization;

(xiii) the prepayment, repurchase, redemption or other retirement or defeasance of the Mezzanine Securities at any time, so long as no Default or Event of Default has occurred and is continuing;

(xiv) Investments in Unrestricted Subsidiaries having an aggregate Fair Market Value, taken together with all other Investments made pursuant to this subclause (xiv) that are at that time outstanding, not to exceed the greater of $500,000,000 and 11% of Total Assets at the time of such Investment (with the Fair Market Value of each Investment being measured at the time made and without giving effect to subsequent changes in value); plus, to the extent such amounts are not otherwise applied to clause (B)(4) of the definition of the term “Applicable Amount,” the amount of any returns (including dividends, payments, interest, distributions, returns of principal, profits on sale, repayments, income and similar amounts) on or in respect of such Investments;

(xv) the distribution, as a dividend or otherwise, of shares of Capital Stock of, or Indebtedness owed to the Canadian Borrower or a Restricted Subsidiary by, Unrestricted Subsidiaries (other than Unrestricted Subsidiaries, the primary assets of which are cash and/or Cash Equivalents);

(xvi) any Investment in respect of an Unrestricted Subsidiary Support Transaction;

(xvii) other Restricted Payments, so long as on a pro forma basis after giving effect to such Restricted Payment and the incurrence of any related Indebtedness, the Total Leverage Ratio for the Test Period immediately preceding such date shall be less than or equal to 3.25 to 1.00;

(xviii) payments by the Canadian Borrower or any Restricted Subsidiary in respect of withholding or similar taxes payable or expected to be payable by any future, current or former employee, director, manager, consultant or independent contractor (or any of their respective immediate family members (which, for the avoidance of doubt, shall mean with respect to any individual, such individual’s estate, heirs, legatees, distributees, child, stepchild, grandchild or more remote descendant, parent, stepparent, grandparent, spouse, former spouse, qualified domestic partner, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law or sister-in-law (including adoptive relationships), any person sharing an individual’s household (other than an unrelated tenant or employee) and any trust, partnership or other bona fide estate-planning vehicle the only beneficiaries of which are any of the foregoing individuals or any private foundation or fund that is controlled by any of the foregoing individuals or any donor-advised fund of which any such individual is the donor)) of the

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Canadian Borrower, any parent entity of the Canadian Borrower or any other Subsidiary in connection with the exercise or vesting of Equity Interests or other equity awards or any repurchases, redemptions, acquisitions, retirements or withholdings of Equity Interests in connection with any exercise of Equity Interests or other equity options or warrants or the vesting of Equity Interests or other equity awards if such Equity Interests represent all or a portion of the exercise price of, or withholding obligation with respect to, such options or, warrants or other Equity Interests or equity awards;

(xix) the payment, on or after the Measurement Date, of one or more dividends to the shareholders and/or option holders of the Canadian Borrower in an aggregate amount not to exceed $10,000,000;

(xx) the repayment, redemption, repurchase, defeasance, exchange or other acquisition or retirement of Dividend Obligations (excluding the payment of any interest (in the form of accretion, PIK, cash or otherwise), expenses or premium related thereto); and

(xxi) payment of dividends by the Canadian Borrower on Director Voting Preferred Shares in an amount not to exceed $50,000 per year.

For purposes of determining compliance with this Section 6.06, in the event that a proposed Restricted Payment or Investment (or a portion thereof) meets the criteria of more than one of the categories of Restricted Payments described in the preceding clauses (i) through (xxi) above and/or one or more of the clauses contained in the definition of Permitted Investments, or is entitled to be made pursuant to the first paragraph of this covenant the Canadian Borrower shall be entitled to divide or classify (or later divide, classify or reclassify in whole or in part in its sole discretion) such Restricted Payment or Investment (or portion thereof) among such subclauses (i) through (xxi) and such first paragraph and/or one or more of the clauses contained in the definition of Permitted Investments, in a manner that otherwise complies with this Section 6.06.

The Canadian Borrower will not permit any Unrestricted Subsidiary to become a Restricted Subsidiary except pursuant to the definition of “Unrestricted Subsidiary.” For purposes of designating any Restricted Subsidiary as an Unrestricted Subsidiary, all outstanding Investments by the Canadian Borrower and its Restricted Subsidiaries (except to the extent repaid) in the Subsidiary so designated will be deemed to be Restricted Payments in an amount determined as set forth in the last sentence of the definition of “Investment.” Such designation will be permitted only if a Restricted Payment in such amount would be permitted at such time, whether pursuant to the this Section 6.06 or the definition of Permitted Investments, and if such Subsidiary otherwise meets the definition of an Unrestricted Subsidiary. Unrestricted Subsidiaries will not be subject to any of the restrictive covenants set forth in this Agreement and will not guarantee the Obligations.

Section 6.07 [Reserved].

Section 6.08 [Reserved].

Section 6.09 First Lien Leverage Ratio. Solely with respect to the Revolving R-3 Facility and subject to the following proviso, beginning with the Test Period ending December 31, 2019, the Canadian Borrower will not permit the First Lien Leverage Ratio as of the last day of any Test Period to be greater than 5.75:1.00; provided, however, that the Canadian Borrower shall be required to be in compliance with this Section 6.09 with respect to any Test Period only if the sum of (A) the aggregate principal amount of all Revolving R-3 Facility Loans and Swingline Loans plus (B) the aggregate L/C Obligations (other than (i) those cash collateralized in an amount equal to the stated amount thereof and (ii) without duplication of amounts described in clause (i) above, L/C Obligations the aggregate stated amount of which do not exceed $1,000,000), in each case outstanding on the last day of such Test Period, exceeds an amount equal to 35.0% of the Revolving R-3 Committed Amount.

Section 6.10 Limitation on Guarantees of Indebtedness by Restricted Subsidiaries. The Canadian Borrower will not permit any Restricted Subsidiary, other than a Guarantor, to guarantee the payment of the Senior Notes, the Senior Secured Notes or any Public Debt issued by the Canadian Borrower or a Restricted Subsidiary, unless:

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(a) such Restricted Subsidiary within 30 days executes and delivers a Guarantee of the Obligations by such Restricted Subsidiary, except that with respect to a guarantee of Indebtedness of any Canadian Borrower or any Guarantor if such Indebtedness is by its express terms subordinated in right of payment to the Obligations or such Guarantor’s Guarantee, any such guarantee of such Restricted Subsidiary with respect to such Indebtedness shall be subordinated in right of payment to such Restricted Subsidiary’s Guarantee substantially to the same extent as such Indebtedness is subordinated to the Obligations or such Guarantor’s Guarantee;

(b) such Guarantee shall provide that such Restricted Subsidiary waives and will not in any manner whatsoever claim or take the benefit or advantage of, any rights of reimbursement, indemnity or subrogation or any other rights against the Canadian Borrower or any other Restricted Subsidiary as a result of any payment by such Restricted Subsidiary under its Guarantee until all amounts then due and payable by the Borrowers with respect to the Senior Notes and the Senior Secured Notes shall have been paid in full; and

(c) such Restricted Subsidiary shall have delivered to the Administrative Agent an officer’s certificate stating that all conditions precedent providing for or relating to the Guarantee of the Obligations by such Restricted Subsidiary have been complied with;

provided that this Section 6.10 shall not be applicable to any guarantee of any Restricted Subsidiary that existed at the time such Person became a Restricted Subsidiary and was not incurred in connection with, or in contemplation of, such Person becoming a Restricted Subsidiary. The Canadian Borrower may elect, in its sole discretion, to cause any Subsidiary that is not otherwise required to be a Guarantor to become a Guarantor, in which case such Subsidiary shall not be required to comply with the 30 day period described in clause (a) above.

Each Guarantee shall be released in accordance with the provisions of Section 10.09 of this Agreement.

Section 6.11 [Reserved].

Section 6.12 Limitations on Transactions with Affiliates. (a) The Canadian Borrower will not, and will not permit any Restricted Subsidiary to, make any payment to, or sell, lease, transfer or otherwise dispose of any of its properties or assets to, or purchase any property or assets from, or enter into or make or amend any transaction, contract, agreement, understanding, loan, advance or guarantee with, or for the benefit of, any Affiliate of the Canadian Borrower (each of the foregoing, an “Affiliate Transaction”) in any one or series of related transactions involving aggregate payments or consideration in excess of $15,000,000, unless:

(i) such Affiliate Transaction is on terms that are not materially less favorable to the Canadian Borrower or the relevant Restricted Subsidiary than those that could have been obtained in a comparable transaction by the Canadian Borrower or such Restricted Subsidiary with an unrelated Person (or, in the event that there are no comparable transactions involving Persons who are not Affiliates of the Canadian Borrower or the relevant Restricted Subsidiary to apply for comparative purposes, is otherwise on terms that, taken as a whole, the Canadian Borrower has determined to be fair to the Canadian Borrower or the relevant Restricted Subsidiary), and

(ii) the Canadian Borrower delivers to the Administrative Agent (x) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate payments or consideration in excess of $35,000,000, a resolution adopted by the majority of the Board of Directors of the Canadian Borrower (and a majority of the Independent Directors) approving such Affiliate Transaction and set forth in an officer’s certificate certifying that such Affiliate Transaction complies with clause (i) above and (y) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate payments or consideration in excess of $75,000,000, a written opinion of a Nationally Recognized Independent Financial Advisor stating that such Affiliate Transaction meets the requirements of clause (i).

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(b) The foregoing provisions will not apply to the following:

(i) transactions between or among the Canadian Borrower or any of the Restricted Subsidiaries; provided that in the case of non-wholly owned Restricted Subsidiaries, no Affiliate of the Canadian Borrower (other than another Restricted Subsidiary) owns more than 10% of the Equity Interests in such Restricted Subsidiary;

(ii) (x) Restricted Payments permitted by Section 6.06 and (y) Permitted Investments;

(iii) the payment of reasonable and customary fees paid to, and indemnities provided on behalf of, and ordinary course employment and severance agreements entered into with, officers, directors, employees or consultants of the Canadian Borrower, any of its direct or indirect parent companies or any Restricted Subsidiary;

(iv) transactions in which the Canadian Borrower or any Restricted Subsidiary, as the case may be, delivers to the Administrative Agent a letter from a Nationally Recognized Independent Financial Advisor stating that such transaction is fair to the Canadian Borrower or such Restricted Subsidiary from a financial point of view or meets the requirements of clause (a) of the preceding paragraph;

(v) other than in respect of the Consulting Services Agreement (which is addressed in clause (12) below), any agreement as in effect as of the Measurement Date, or any amendment thereto (so long as any such agreement, together with all amendments thereto, taken as a whole, is not more disadvantageous as determined by the Canadian Borrower to the Lenders in any material respect than the agreement in effect as of the Measurement Date) or any transactions contemplated thereby;

(vi) the existence of, or the performance by the Canadian Borrower or any of its Restricted Subsidiaries of its obligations under the terms of, any stockholders agreement (including any registration rights agreement or purchase agreement related thereto) to which it is a party as of the Measurement Date and any similar agreements which it may enter into thereafter; provided, however, that the existence of, or the performance by the Canadian Borrower or any Restricted Subsidiary of obligations under any future amendment to any such existing agreement or under any similar agreement entered into after the Measurement Date shall only be permitted by this subclause (vi) to the extent that the terms of any such agreement, together with all amendments thereto, taken as a whole, or new agreement are not more disadvantageous as determined by the Canadian Borrower to the Lenders or the Canadian Borrower and its Restricted Subsidiaries in any material respect than the agreement in effect as of the Measurement Date;

(vii) any payments of tax distributions in accordance with Section 3.7 of the Ancillary Agreement that do not exceed $2,000,000 per calendar year and any payments of tax distributions in accordance with Section 6.06(b)(x)(A);

(viii) any transaction with a joint venture or similar entity which would constitute an Affiliate Transaction solely because the Canadian Borrower or a Restricted Subsidiary owns an equity interest in or otherwise controls such joint venture or similar entity; provided that no Affiliate of the Canadian Borrower or any of its Subsidiaries other than the Canadian Borrower or a Restricted Subsidiary shall have a beneficial interest in such joint venture or similar entity;

(ix) the issuance of Equity Interests (other than Disqualified Capital Stock) of the Canadian Borrower to any Person;

(x) payments or loans (or cancellation of loans) to employees or consultants of the Canadian Borrower, any of its direct or indirect parent companies or any Restricted Subsidiary which are approved by a majority of the Board of Directors of the Canadian Borrower in good faith;

(xi) any Spectrum Repurposing;

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(xii) (A) the annual fee of $5,000,000 to be paid to Loral pursuant to the Consulting Services Agreement as in effect on the Measurement Date, which fee may be payable in the form of cash or Mezzanine Securities, (B) reimbursements for payments to non-affiliated third parties made by any Permitted Holders on behalf of the Canadian Borrower and/or its Restricted Subsidiaries pursuant to the Consulting Services Agreement not to exceed $2,000,000 in the aggregate in any calendar year, (C) payment for services rendered under the Consulting Services Agreement as in effect on the Measurement Date not to exceed $5,000,000 per calendar year to the extent such payments are approved by the Independent Directors in accordance with the provisions of the Consulting Services Agreement as in effect on the Measurement Date and (D) the payment to any purchaser who purchases all or a majority of the Equity Interests of the Canadian Borrower in accordance with the terms of this Agreement (and such purchase does not result in a Change of Control and a Rating Decline) of reasonable management, monitoring, consulting and advisory fees, indemnities and related expenses, as reasonably determined by the Canadian Borrower and such purchaser in an aggregate amount pursuant to this clause (d) not to exceed 2% of Consolidated EBITDA in any year;

(xiii) any Unrestricted Subsidiary Support Transaction;

(xiv) pledges of Equity Interests of Unrestricted Subsidiaries;

(xv) transactions permitted by, and complying with, the provisions of Section 6.03;

(xvi) any contribution of capital to the Canadian Borrower;

(xvii) (A) transactions with customers, clients, suppliers or purchasers or sellers of goods or services, or transactions otherwise relating to the purchase or sale of goods or services, in each case in the ordinary course of business and otherwise in compliance with the terms of this Agreement, which are fair to the Canadian Borrower and its Restricted Subsidiaries in the reasonable determination of the Board of Directors or the senior management of the Canadian Borrower, or are on terms at least as favorable as might reasonably have been obtained at such time from an unaffiliated party or (B) transactions with joint ventures or Unrestricted Subsidiaries entered into in the ordinary course of business; and

(xviii) the incurrence by the Canadian Borrower of Dividend Obligations and payments of interest and principal related thereto.

Section 6.13 Limitation on Activities of the U.S. Borrower. The U.S. Borrower may not hold any material assets, become liable for any material obligations, engage in any trade or business, or conduct any business activity, other than (1) the issuance of its Equity Interests to the Canadian Borrower or any Restricted Subsidiary of the Canadian Borrower that is a Wholly Owned Subsidiary, (2) the incurrence of Indebtedness as a co-obligor or guarantor, as the case may be, of the Senior Notes or the Senior Secured Notes, the Obligations and any other Indebtedness that is permitted to be incurred by the Canadian Borrower under Section 6.01; provided that the net proceeds of such Indebtedness are not retained by the U.S. Borrower, and (3) activities incidental thereto. Neither the Canadian Borrower nor any Restricted Subsidiary shall engage in any transactions with the U.S. Borrower in violation of the immediately preceding sentence.

Section 6.14 Limitations on Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries. The Canadian Borrower will not, and will not permit any Restricted Subsidiary to, directly or indirectly, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or consensual restriction on the ability of any such Restricted Subsidiary to:

(a) (1) pay dividends or make any other distributions to the Canadian Borrower or any Restricted Subsidiary:

(x) on its Capital Stock, or

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(y) with respect to any other interest or participation in, or measured by, its profits, or

(i) pay any Indebtedness owed to the Canadian Borrower or any Restricted Subsidiary;

(b) make loans or advances to the Canadian Borrower or any Restricted Subsidiary; or

except (in each case) for such encumbrances or restrictions existing under or by reason of:

(i) contractual encumbrances or restrictions in effect on the Measurement Date, including pursuant to the Senior Notes, and contractual encumbrances or restrictions in effect on the Amendment No. 6 Effective Date pursuant to the Senior Secured Notes;

(ii) this Agreement and Guarantees;

(iii) purchase money obligations and Finance Lease Obligations for property acquired in the ordinary course of business that impose restrictions of the nature discussed in clause (c) above on the property so acquired or leased;

(iv) applicable law or any applicable rule, regulation or order;

(v) any agreement or other instrument of a Person acquired by the Canadian Borrower or any Restricted Subsidiary in existence at the time of such acquisition (but not created in contemplation thereof), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired;

(vi) contracts for the sale of assets, including customary restrictions with respect to a Subsidiary pursuant to an agreement that has been entered into for the sale or disposition of all or substantially all of the Capital Stock or assets of such Subsidiary;

(vii) Secured Indebtedness otherwise permitted to be incurred pursuant to Section 6.01 and Section 6.02 that limit the right of the debtor to dispose of the assets securing such Indebtedness;

(viii) restrictions on cash or other deposits or net worth imposed by customers under contracts entered into in the ordinary course of business;

(ix) customary provisions in joint venture agreements and other similar agreements;

(x) customary provisions contained in leases and other agreements entered into in the ordinary course of business;

(xi) other Indebtedness of the Canadian Borrower or any Restricted Subsidiary that is incurred subsequent to the Measurement Date pursuant to Section 6.01; provided that such encumbrances or restrictions (A) are no less favorable to the Canadian Borrower or such Restricted Subsidiary, taken as a whole, than those included in this Agreement (as determined by the Canadian Borrower in good faith) or (B) will not materially affect the Borrowers’ ability to make anticipated principal or interest payments pursuant to this Agreement (as determined by the Canadian Borrower in good faith); and

(xii) any encumbrances or restrictions of the type referred to in clauses (a), (b) and (c) above imposed by any amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings of the contracts, instruments or obligations referred to in subclauses (i) through (xi) above, provided that such amendments, modifications, restatements, renewals, increases,

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supplements, refundings, replacements or refinancings are, as determined by the Canadian Borrower in good faith, not materially more restrictive with respect to such encumbrance and other restrictions than those prior to such amendment, modification, restatement, renewal, increase, supplement, refunding, replacement or refinancing.

Section 6.15 Fiscal Year. The Canadian Borrower will not, and will not permit any of the Restricted Subsidiaries to change its fiscal year-end to a date other than December 31.

Section 6.16 Changes in Business. The Canadian Borrower will not, and will not permit any of its Restricted Subsidiaries to, engage in any business other than the Permitted Business.

ARTICLE VII

EVENTS OF DEFAULT

Section 7.01 Events of Default. In case of the happening of any of the following events (“Events of Default”):

(a) any representation or warranty made or deemed made by the Canadian Borrower or any other Loan Party in any Loan Document, or any representation, warranty or material statement contained in any report, certificate, financial statement or other instrument furnished in connection with or pursuant to any Loan Document, shall prove to have been false or misleading in any material respect when so made, deemed made or furnished by the Canadian Borrower or any other Loan Party;

(b) default shall be made in the payment of any principal of any Loan or the reimbursement with respect to any L/C Disbursement when and as the same shall become due and payable, whether at the due date thereof or at a date fixed for prepayment thereof or by acceleration thereof or otherwise;

(c) default shall be made in the payment of any interest on any Loan or on any L/C Disbursement or in the payment of any Fee (other than an amount referred to in (b) above) due under any Loan Document, when and as the same shall become due and payable, and such default shall continue unremedied for a period of five Business Days;

(d) default shall be made in the due observance or performance by the Canadian Borrower or any of the Restricted Subsidiaries of any covenant, condition or agreement contained in Section 5.01(a) (with respect to the Borrowers), 5.05(a), 5.08 or in Article VI (subject to the cure rights contained in Section 7.02);

(e) default shall be made in the due observance or performance by the Canadian Borrower or any of the Restricted Subsidiaries of any covenant, condition or agreement contained in any Loan Document (other than those specified in paragraphs (b), (c) and (d) above) and such default shall continue unremedied for a period of 30 days after written notice thereof from the Administrative Agent to the Canadian Borrower;

(f) (i) any event or condition occurs that (A) results in any Material Indebtedness becoming due prior to its scheduled maturity or (B) enables or permits (with all applicable grace periods having expired) the holder or holders of any Material Indebtedness or any trustee or agent on its or their behalf to cause any Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity; provided that such event or condition remains unremedied or has not been waived (including in the form of an amendment) by the holders of such Indebtedness or (ii) the Canadian Borrower or any of the Restricted Subsidiaries shall fail to pay the principal of any Material Indebtedness at the stated final maturity thereof; provided that this clause (f) shall not apply to secured Indebtedness that becomes due as a result of the voluntary sale or transfer of the property or assets securing such Indebtedness if such sale or transfer is permitted hereunder and under the documents providing for such Indebtedness; provided, further, that this clause (f) shall not apply to (A) Indebtedness outstanding under any Swap Agreements that becomes due pursuant to a termination event or

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equivalent event under the terms of such Swap Agreements, (B) secured Indebtedness that becomes due as a result of a disposition or a Casualty Event with respect to the property or assets securing such Indebtedness, (C) Indebtedness that is convertible into Equity Interests and converts to Equity Interests in accordance with its terms or (D) any Indebtedness permitted to exist or be incurred under the terms of this Agreement that is required to be repurchased, prepaid, acquired, defeased or redeemed in connection with any asset sale event, casualty, eminent domain or condemnation event, change of control (without limiting the rights of the Administrative Agent and the Lenders under Section 7.01(g)), excess cash flow or other customary provision in such Indebtedness giving rise to such requirement to repurchase, prepay, acquire, defease or redeem in the absence of any default thereunder;

(g) there shall have occurred a Change of Control (other than a Permitted Change of Control);

(h) an involuntary proceeding shall be commenced or an involuntary petition or application shall be filed in a court of competent jurisdiction seeking (i) relief in respect of any Borrower or any of the Material Subsidiaries, or of a substantial part of the property or assets of any Borrower or any Material Subsidiary, under Title 11 of the United States Code, as now constituted or hereafter amended, or any other federal, state or Canadian, provincial or other foreign bankruptcy, liquidation, insolvency, receivership or similar law, including the BIA, CCAA, and WURA, (ii) the appointment of a receiver, trustee, monitor, liquidator, custodian, sequestrator, conservator or similar official for any Borrower or any of the Material Subsidiaries or for a substantial part of the property or assets of any Borrower or any of the Material Subsidiaries or (iii) the winding-up, dissolution or liquidation of any Borrower or any Material Subsidiary (except, in the case of any Material Subsidiary (other than any Borrower), in a transaction permitted by Section 6.03); and such proceeding or petition or application shall continue undismissed for 60 days or an order or decree approving or ordering any of the foregoing shall be entered;

(i) any Borrower or any Material Subsidiary shall (i) voluntarily commence any proceeding or file any petition or application seeking relief under Title 11 of the United States Code, as now constituted or hereafter amended, or any other federal, state or Canadian, provincial or other foreign bankruptcy, insolvency, receivership or similar law, including the BIA, CCAA, and WURA, (ii) seek, or consent to, the institution of, or fail to contest in a timely and appropriate manner, any proceeding or the filing of any petition or application described in paragraph (h) above, (iii) apply for or consent to the appointment of a receiver, trustee, custodian, monitor, liquidator, sequestrator, conservator or similar official for any Borrower or any of the Material Subsidiaries or for a substantial part of the property or assets of any Borrower or any Material Subsidiary or (iv) file an answer or response admitting the material allegations of a petition or application filed against it in any such proceeding;

(j) the failure by any Borrower or any Material Subsidiary to pay one or more final monetary judgments (not covered by insurance) aggregating in excess of $110,000,000, which judgments are not discharged, vacated or effectively waived or stayed for a period of 60 consecutive days, or any action shall be legally taken by a judgment creditor to levy upon any material assets or properties of any Borrower or any Material Subsidiary to enforce any such judgment;

(k) (i) An ERISA Event (or similar event with respect to a Non-U.S. Pension Plan) shall have occurred; (ii) a trustee shall be appointed by a United States district court to administer any Plan, (iii) the Canadian Borrower or any Restricted Subsidiary or any ERISA Affiliate shall have been notified by the sponsor of a Multiemployer Plan that it has incurred or will be assessed Withdrawal Liability to such Multiemployer Plan and such person does not have reasonable grounds for contesting such Withdrawal Liability or is not contesting such Withdrawal Liability in a timely and appropriate manner, (iv) the Canadian Borrower or any Restricted Subsidiary or any ERISA Affiliate shall have been notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is in “endangered” or “critical” status (within the meaning of Section 432 of the Code or Section 305 of ERISA) or is being terminated, within the meaning of Title IV of ERISA, (v) the Canadian Borrower or any Subsidiary or any ERISA Affiliate shall engage in any “prohibited transaction” (as defined in Section 406 of ERISA or Section 4975 of the Code) involving any Plan, (vi) any other similar event or condition shall occur or exist with respect to a Plan, a Non-U.S. Pension Plan or a Multiemployer Plan or (vii) a Canadian Pension Event shall have occurred with respect to a Canadian Plan; and in each case in clauses (i) through (vii) above, such event or condition, together with all other such events or conditions under this Section 7.01(k), if any, could reasonably be expected to have a Material Adverse Effect;

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(l) (i) any Loan Document shall for any reason be asserted in writing by any Borrower or any Subsidiary Loan Party not to be a legal, valid and binding obligation of any party thereto, (ii) any security interest or other Lien purported to be created by any Security Document and to extend to assets that are not immaterial to any Borrower and the Subsidiaries on a consolidated basis shall cease to be, or shall be asserted in writing by any Borrower or any other Loan Party not to be, a valid and perfected security interest or Lien, respectively, (having the priority required by this Agreement or the relevant Security Document) in the securities, assets or properties covered thereby, except to the extent that any such loss of perfection or priority results from the failure of the Collateral Agent to maintain possession of certificates actually delivered to it representing securities pledged under the Security Documents or to file UCC continuation statements or PPSA financing charges and except to the extent that such loss is covered by a lender’s title insurance policy and the Administrative Agent shall be reasonably satisfied with the credit of such insurer or (iii) the Guarantees pursuant to the Loan Documents by any Borrower or the Subsidiary Loan Parties of any of the Obligations shall cease to be in full force and effect (other than in accordance with the terms thereof), or shall be asserted in writing by any Borrower or any Subsidiary Loan Party not to be in effect or not to be legal, valid and binding obligations;

then, subject to Section 7.02, and in every such event (other than an event with respect to the Canadian Borrower or the U.S. Borrower described in paragraph (h) or (i) above), and at any time thereafter during the continuance of such event, the Administrative Agent, at the request of the Required Lenders, shall, by notice to the Canadian Borrower, take any or all of the following actions, at the same or different times: (i) terminate forthwith the Commitments, (ii) declare the Loans then outstanding to be forthwith due and payable in whole or in part, whereupon the principal of the Loans (including the face amount of all BAs outstanding) so declared to be due and payable, together with accrued interest thereon and any unpaid accrued Fees and all other liabilities of the Borrowers accrued hereunder and under any other Loan Document, shall become forthwith due and payable, without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived by the Borrowers, anything contained herein or in any other Loan Document to the contrary notwithstanding, (iii) demand cash collateral pursuant to Section 2.05(i) and (iv) exercise, or direct the Collateral Agent to exercise, any or all rights and remedies under the Security Documents; and, in any event, with respect to the Canadian Borrower or the U.S. Borrower described in paragraph (h) or (i) above, the Commitments shall automatically terminate, the principal of the Loans then outstanding (including the face amount of all BAs outstanding), together with accrued interest thereon and any unpaid accrued Fees and all other liabilities of the Borrowers accrued hereunder and under any other Loan Document, shall automatically become due and payable and the Administrative Agent shall be deemed to have made a demand for cash collateral to the full extent permitted under Section 2.05(i), without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived by the Borrowers, anything contained herein or in any other Loan Document to the contrary notwithstanding.

Section 7.02 Right to Cure.

(a) Notwithstanding anything to the contrary contained in Section 7.01, in the event that the Canadian Borrower reasonably expects to fail (or has failed) to comply with the requirements of the Financial Performance Covenant as of the end of any Test Period, at any time from the end of such Test Period through and until the expiration of the 10th Business Day subsequent to the date the certificate calculating such Financial Performance Covenant is required to be delivered pursuant to Section 5.04(c), the Canadian Borrower (or any parent entity thereof) shall have the right to issue Equity Interests (other than Disqualified Capital Stock) for cash or otherwise receive cash contributions to the capital of the Canadian Borrower, and, in each case, to contribute any such cash to the capital of the Canadian Borrower (collectively, the “Cure Right”), and upon the receipt by the Canadian Borrower of such cash (the “Cure Amount”) pursuant to the exercise by the Canadian Borrower of such Cure Right and request to the Administrative Agent to effect such recalculation, such Financial Performance Covenant shall be recalculated giving effect to the following pro forma adjustments:

(i) Consolidated EBITDA shall be increased with respect to such applicable fiscal quarter with respect to which such Cure Amount is received and any Test Period that includes such fiscal quarter, solely for the purpose of determining whether an Event of Default has occurred and is continuing as a result of a violation of the Financial Performance Covenant and, subject to clause (iii) below, not for any other purpose under this Agreement, by an amount equal to the Cure Amount and there shall be no pro forma reduction in Indebtedness (by netting or otherwise) with the proceeds of any Cure Amount for determining

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compliance with the Financial Performance Covenant for the fiscal quarter for which such Cure Amount is deemed applied;

(ii) if, after giving pro forma effect to such increase in Consolidated EBITDA, the Canadian Borrower shall then be in compliance with the requirements of the Financial Performance Covenant, the Canadian Borrower shall be deemed to have satisfied the requirements of the Financial Performance Covenant as of the relevant date of determination with the same effect as though there had been no failure to comply therewith at such date, and the applicable breach or default of the Financial Performance Covenant that had occurred shall be deemed cured for purposes of this Agreement; and

(iii) Consolidated First Lien Secured Debt with respect to any Test Period subsequent to the Test Period for which the Cure Amount is deemed applied that includes such fiscal quarter with respect to which such Cure Amount is received shall be decreased solely to the extent proceeds of the Cure Amount are applied to prepay any Indebtedness (provided that any such Indebtedness so prepaid shall be a permanent repayment of such Indebtedness and termination of commitments thereunder) included in the calculation of Consolidated First Lien Secured Debt.

(b) Limitation on Exercise of Cure Right. Notwithstanding anything herein to the contrary, (i) in each four fiscal-quarter period there shall be at least two fiscal quarters in which the Cure Right is not exercised, (ii) there shall be no more than five exercises of the Cure Right and (iii) the Cure Amount shall be no greater than the amount required for purposes of complying with the Financial Performance Covenant as of the end of such fiscal quarter.

ARTICLE VIII

THE AGENTS

Section 8.01 Appointment and Authorization of the Agents.

(a) Appointment. Each Lender and L/C Issuer hereby irrevocably appoints, designates and authorizes JPMCB, as Administrative Agent and Collateral Agent, each of CIBC, BMO Capital Markets Corp., RBC Capital Markets and TD SECURITIES, as Revolving R-2 Facility joint lead arrangers and bookrunners, JPMCB, Credit Suisse Securities (USA) LLC, Goldman Sachs Bank USA and Morgan Stanley Senior Funding, Inc., as Revolving R-2 Facility co-arrangers, JPMCB, Credit Suisse Securities (USA) LLC, Goldman Sachs USA and Morgan Stanley Senior Funding, Inc. as Term B-3 Loan Facility joint lead arrangers and bookrunners, CIBC, BMO Capital Markets Corp., RBC Capital Markets and TD SECURITIES, as Term B-3 Loan Facility co-arrangers, in each case in connection with Amendment No. 2, JPMCB as sole lead arranger and bookrunner for the Term B-4 Loan Facility in connection with Amendment No. 4, JPMCB, Credit Suisse Loan Funding LLC, Goldman Sachs Bank USA and Morgan Stanley Senior Funding, Inc. as lead arrangers in connection with Amendment No. 5, and Goldman Sachs Bank USA, JPMCB, BMO Capital Markets, CIBC, Credit Suisse Loan Funding LLC, Morgan Stanley Senior Funding, Inc., RBC Capital Markets, ING Bank N.V., The Bank of Nova Scotia and TD SECURITIES, as joint lead arrangers and bookrunners for the Revolving R-3 Facility, and JPMCB and Goldman Sachs Bank USA as joint lead arrangers and bookrunners for the Term B-5 Loan Facility in connection with Amendment No. 6, and each Lender and each L/C Issuer authorizes each such institutions to take such action on its behalf under the provisions of this Agreement and each other Loan Document and to exercise such powers and perform such duties as are expressly delegated to it by the terms of this Agreement or any other Loan Document, together with such powers as are reasonably incidental thereto. Without limiting the foregoing, each Lender and each L/C Issuer hereby authorizes the Collateral Agent to execute and deliver, and to perform its obligations under, each of the Loan Documents to which the Collateral Agent is a party, to exercise all rights, powers and remedies that such Agent may have under such Loan Documents and, in the case of the Security Documents, to act as agent under such Security Documents for the Lenders. Each Swap Counterparty shall be deemed to have appointed JPMCB, as Collateral Agent, as its agent for the purposes stated herein and the other Loan Documents. Notwithstanding any provision to the contrary contained elsewhere herein or in any other Loan Document, the Agents shall not have any duties or responsibilities, except those expressly set forth herein or therein, nor shall the Agents have or be deemed to have any fiduciary relationship with any Lender or participant, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or any other Loan Document or otherwise exist against any Agent.

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Without limiting the generality of the foregoing sentence, the use of the term “agent” herein and in the other Loan Documents with reference to any Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable Law. Instead, such term is used merely as a matter of market custom, and is intended to create or reflect only an administrative relationship between independent contracting parties.

(b) L/C Issuers. Each L/C Issuer shall act on behalf of the Revolving R-3 Facility Lenders with respect to any Letters of Credit issued by it and the documents associated therewith, and each L/C Issuer shall have all of the benefits and immunities (i) provided to the Administrative Agent in this Article VIII with respect to any acts taken or omissions suffered by such L/C Issuer in connection with Letters of Credit issued by it or proposed to be issued by it and the applications and agreements for letters of credit pertaining to such Letters of Credit as fully as if the term “Administrative Agent” as used in this Article VIII and in the definition of “Agent-Related Person” included the L/C Issuer with respect to such acts or omissions, and (ii) as additionally provided herein with respect to the L/C Issuer.

(c) Instructions of Required Lenders. Without limiting an Agent’s right to exercise the discretion granted hereunder or under any other Loan Document, as to any matters not expressly provided for by this Agreement and the other Loan Documents (including enforcement or collection), (i) the Administrative Agent shall not be required to exercise any discretion or take any action, but shall be required to act or to refrain from acting (and shall be fully protected in so acting or refraining from acting) upon the instructions of the Required Lenders, and such instructions shall be binding upon all Lenders and each L/C Issuer, (ii) the Collateral Agent shall not be required to exercise any discretion or take any action, but shall be required to act or to refrain from acting (and shall be fully protected in so acting or refraining from acting) upon the instructions of the Required Lenders, and such instructions shall be binding upon the Lenders; provided, however, that neither the Administrative Agent nor the Collateral Agent shall be required to take any action that (x) the Administrative Agent or the Collateral Agent in good faith believes exposes it to personal liability unless such Agent receives an indemnification satisfactory to it from the Lenders and the L/C Issuers with respect to such action or (y) is contrary to any Loan Document or applicable Law. Each of the Administrative Agent and the Collateral Agent agrees to give to each other Agent and each Lender and each L/C Issuer prompt notice of each notice given to it by any Loan Party pursuant to the terms of this Agreement or the other Loan Documents.

(d) Agency Duties Limited to Applicable Classes. Neither the Administrative Agent nor the Collateral Agent assumes or shall be deemed to have assumed any obligation other than as expressly set forth herein and in the other Loan Documents or any other relationship as the agent, fiduciary or trustee of or for any Lender, L/C Issuer or holder of any other Secured Obligation.

(e) Quebec Appointment. Without limiting the foregoing, each Lender, acting for itself and on behalf of all other present and future Secured Parties, hereby irrevocably appoints and authorizes the Collateral Agent (and any successor acting as Collateral Agent) to act as hypothecary representative (fondé de pouvoir) (within the meaning of Article 2692 of the Civil Code of Québec) for all present and future creditors of the obligations secured by each deed of hypothec referred to below (in such capacity the “Attorney”) in order to hold any hypothec granted under the laws of the Province of Quebec as security for the Secured Obligations or for any debenture, bond or other title of indebtedness that may be issued and secured pursuant to a deed of hypothec and to exercise such rights and duties as are conferred upon a fondé de pouvoir under any such deed of hypothec and applicable laws (with the power to delegate any such rights or duties). Moreover, without prejudice to such appointment and authorization to act as Attorney, each Lender, for itself and for all other present and future Secured Parties, hereby irrevocably appoints and authorizes the Collateral Agent (and any successor acting as Collateral Agent) (in such capacity, the “Custodian”) to act as agent and custodian for and on behalf of the Lenders and the other Secured Parties to hold and to be the sole registered holder of any bond, debenture or other title of indebtedness which may be issued under or secured by any deed of hypothec, the whole notwithstanding Section 32 of the Act respecting the specialpowers of legal persons (Quebec) or any other applicable law. In this respect: (i) the Custodian shall keep a record indicating the names and addresses of, and the pro rata portion of the obligations and indebtedness secured by any pledge of any such bond, debenture or other title of indebtedness and owing to each Lender and each other Secured Party, and (ii) each Lender and each other Secured Party will be entitled to the benefits of any charged property covered by any deed of hypothec and will participate in the proceeds of realization of any such charged property, the whole in accordance with the terms hereof. The execution prior to the Amendment No. 2 Effective Date by the Collateral

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Agent, as fondé de pouvoir of any deed of hypothec or as Custodian of any other security documents made pursuant to the laws of the Province of Quebec, is hereby ratified and confirmed.

Each of the Attorney and the Custodian shall: (a) have the sole and exclusive right and authority to exercise, except as may be otherwise specifically restricted by the terms hereof, all rights and remedies given to the Attorney and the Custodian (as applicable) pursuant to any deed of hypothec, pledge agreement, applicable laws or otherwise, (b) benefit from and be subject to all provisions hereof with respect to the Collateral Agent, including, without limitation, all such provisions with respect to the liability or responsibility to and indemnification by the Lenders, and (c) be entitled to delegate from time to time any of its powers or duties under any deed of hypothec or pledge agreement on such terms and conditions as it may determine from time to time. Any person who becomes a Secured Party shall be deemed to have consented to and confirmed: (i) the Attorney as hypothecary representative (fondé de pouvoir) as aforesaid and to have ratified, as of the date it becomes a Secured Party, all actions taken by the Attorney in such capacity, and (ii) the Custodian as the agent and custodian as aforesaid and to have ratified, as of the date it becomes a Secured Party, all actions taken by the Custodian in such capacity.

In the event of the appointment of a successor Collateral Agent, such successor Collateral Agent shall also act as successor Attorney under each deed of hypothec referred to above without any further agreement, action or other formality (subject to, prior to the successor Attorney exercising the rights relating to a hypothec created under any such deed of hypothec, the publication by registration of a notice of replacement in the applicable registers in accordance with the terms of Article 2692 of the Civil Code of Québec).

Section 8.02 Delegation of Duties. The Administrative Agent and the Collateral Agent may execute any of its duties hereunder or under the other Loan Documents by or through agents, employees or attorneys-in-fact and shall be entitled to advice of counsel and other consultants or experts concerning all matters pertaining to such duties. The Administrative Agent and the Collateral Agent shall not be responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by it in the absence of gross negligence or willful misconduct.

Section 8.03 Exculpatory Provisions. No Agent-Related Person shall be (i) liable for any action lawfully taken or omitted to be taken by any of them under or in connection herewith or in connection with any of the other Loan Documents or the transactions contemplated hereby or thereby (except for its own gross negligence or willful misconduct in connection with its duties expressly set forth herein) or (ii) responsible in any manner to any of the Lenders or participants for any recitals, statements, representations or warranties made by any of the Loan Parties contained herein or in any of the other Loan Documents or in any certificate, report, document, financial statement or other written or oral statement referred to or provided for in, or received by an Agent under or in connection herewith or in connection with the other Loan Documents, or enforceability or sufficiency therefor of any of the other Loan Documents, or for any failure of any Loan Party to perform its obligations hereunder or thereunder. No Agent-Related Person shall be under any obligation to any Lender or participant or be required to ascertain or inquire as to the performance or observance of any of the terms, conditions, provisions, covenants or agreements contained herein or therein or as to the use of the proceeds of the Loans or the use of the Letters of Credit or of the existence or possible existence of any Default or Event of Default or to inspect the properties, books or records of the Loan Parties or any Affiliate thereof. The Administrative Agent shall not be responsible or have any liability for, or have any duty to ascertain, inquire into, monitor or enforce, compliance with the provisions hereof relating to Disqualified Lenders and Net Short Lenders. Without limiting the generality of the foregoing, the Administrative Agent shall not (x) be obligated to ascertain, monitor or inquire as to whether any Lender or prospective Lender is a Disqualified Lender or a Net Short Lender or (y) have any liability with respect to or arising out of any assignment of Loans, or disclosure of confidential information to, any Disqualified Lender, or any direction or instruction given to the Administrative Agent by any Net Short Lender.

Section 8.04 Reliance on Communications.

(a) Each Agent shall be entitled to rely, and shall be fully protected in relying, upon any writing, communication, signature, resolution, representation, notice, consent, certificate, affidavit, letter, telegram, facsimile, telex or telephone message, electronic mail message, statement 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 any Loan Party), independent accountants and other experts

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selected by such Agent. Each Agent shall be fully justified in failing or refusing to take any action under any Loan Document unless it shall first receive such advice or concurrence of the Required Lenders as it deems appropriate and, if it so requests, it shall first be indemnified to its satisfaction by the Lenders against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action. Each Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement or any other Loan Document in accordance with a request or consent of the Required Lenders (or such greater number of Lenders as may be expressly required hereby in any instance) and such request and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders.

(b) For purposes of determining compliance with the conditions specified in Section 4.01, each Lender that has signed this Agreement shall be deemed to have consented to, approved or accepted or to be satisfied with, each document or other matter required thereunder to be consented to or approved by or acceptable or satisfactory to a Lender unless the Administrative Agent shall have received notice from such Lender prior to the proposed Amendment No. 2 Effective Date specifying its objection thereto.

Section 8.05 Notice of Default. No Agent shall be deemed to have knowledge or notice of the occurrence of any Default, except with respect to defaults in the payment of principal, interest and fees required to be paid to the Agent for the account of the Lenders, unless the Agent shall have received written notice from a Lender or any Borrower referring to this Agreement, describing such Default and stating that such notice is a “notice of default.” The Administrative Agent will notify the Lenders of its receipt of any such notice. The Administrative Agent shall take such action with respect to such Default as may be directed by the Required Lenders in accordance with Article VII; provided, however, that unless and until the Administrative Agent has received any such direction, the Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Default as it shall deem advisable or in the best interest of the Lenders.

Section 8.06 Credit Decision; Disclosure of Information by Administrative Agent; No Reliance on Arrangers’ or Agents’ Customer Identification Program.

(a) Independent Credit Decision. Each Lender acknowledges that no Agent-Related Person has made any representation or warranty to it, and that no act by the Administrative Agent hereafter taken, including any consent to and acceptance of any assignment or review of the affairs of any Loan Party or any Affiliate thereof, shall be deemed to constitute any representation or warranty by any Agent-Related Person to any Lender as to any matter, including whether Agent-Related Persons have disclosed material information in their possession. Each Lender represents to the Administrative Agent that it has, independently and without reliance upon any Agent-Related Person and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, prospects, operations, property, financial and other condition and creditworthiness of the Loan Parties and their respective Subsidiaries, and all applicable bank or other regulatory Laws relating to the transactions contemplated hereby, and made its own decision to enter into this Agreement and to extend credit to any Borrower and the other Loan Parties hereunder. Each Lender also represents that it will, independently and without reliance upon any Agent-Related Person 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 Loan Documents, and to make such investigations as it deems necessary to inform itself as to the business, prospects, operations, property, financial and other condition and creditworthiness of any Borrower and the other Loan Parties. Except for notices, reports and other documents expressly required to be furnished to the Lenders by the Administrative Agent herein, the Agents and the Joint Lead Arrangers shall not have any duty or responsibility to provide any Lender with any credit or other information concerning the business, prospects, operations, property, financial and other condition or creditworthiness of any of the Loan Parties or any of their respective Affiliates which may come into the possession of any Agent-Related Person.

(b) U.S. Patriot Act Customer Identification Programs. Each Lender acknowledges and agrees that neither such Lender nor any of its Affiliates, participants or assignees may rely on the Joint Lead Arranger or any Agent to carry out such Lender’s, Affiliate’s, participant’s or assignee’s customer identification program or other obligations required or imposed under or pursuant to the Patriot Act or the regulations thereunder, including the regulations contained in 31 C.F.R. 103.121 (as hereafter amended or replaced, the “CIP Regulations”), or any other Anti-Terrorism Laws and Anti-Money Laundering Laws, or the Beneficial Ownership Regulation, including any

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programs involving any of the following items relating to or in connection with any of the Loan Parties, their Affiliates or agents, the Loan Documents or the transactions hereunder or contemplated hereby: (i) any identification procedures; (ii) and recordkeeping; (iii) comparisons with government lists, (iv) customer notices; or (v) other procedures required under the CIP Regulations, the Beneficial Ownership Regulation or such other Laws.

Section 8.07 Indemnification. Whether or not the transactions contemplated hereby are consummated, the Lenders agree to indemnify each Agent-Related Person (to the extent not reimbursed by or on behalf of any Loan Party and without limiting the obligation of the Borrowers and the other Loan Parties to do so), ratably according to their respective Commitments (or if the Commitments have expired or been terminated, in accordance with the respective principal amounts of outstanding Loans and Participation Interests of the Lenders), from and against any and all indemnified liabilities which may at any time (including, without limitation, at any time following payment in full of the Secured Obligations) be imposed on, incurred by or asserted against any Agent-Related Person; provided that no Lender shall be liable for the payment to any Agent-Related Person of any portion of such indemnified liabilities resulting from such Agent-Related Person’s gross negligence or willful misconduct (as determined by a court of competent jurisdiction by a final and non-appealable judgment); provided, however, that no action taken in accordance with the directions of the Required Lenders shall be deemed to constitute gross negligence or willful misconduct for purposes of this Section 8.07; provided, further, that to the extent that a L/C Issuer is entitled to indemnification under this Section 8.07 solely in its capacity and role as L/C Issuer, only the Revolving R-3 Facility Lenders shall be required to indemnify such L/C Issuer in accordance with this Section 8.07. Without limitation of the foregoing, each Lender shall reimburse the Administrative Agent and the Collateral Agent upon demand for its ratable share of any costs or out-of-pocket expenses (including Attorney Costs) incurred by the Administrative Agent or the Collateral Agent in connection with the preparation, execution, delivery, administration, modification, amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in respect of rights or responsibilities under, this Agreement, any other Loan Document or any document contemplated by or referred to herein, to the extent that the Administrative Agent or the Collateral Agent is not reimbursed for such expenses by or on behalf of any Borrower or any other Loan Party. The agreements in this Section 8.07 shall survive the payment of the Secured Obligations and all other obligations and amounts payable hereunder and under the other Loan Documents and the resignation of the Administrative Agent and the Collateral Agent.

Section 8.08 Agents in Their Individual Capacity. JPMCB and its Affiliates may make loans to, issue letters of credit for the account of, accept deposits from, acquire Equity Interests in and generally engage in any kind of banking, trust, financial advisory, underwriting or other business with each of the Loan Parties and their respective Affiliates as though JPMCB were not the Administrative Agent, an L/C Issuer, the Swingline Lender, or the Collateral Agent hereunder or under another Loan Document and without notice to or consent of the Lenders. The Lenders acknowledge that, pursuant to such activities, JPMCB or its Affiliates may receive information regarding any Loan Party or its Affiliates (including information that may be subject to confidentiality obligations in favor of such Loan Party or such Affiliate) and acknowledge that the Administrative Agent and the Collateral Agent shall be under no obligation to provide such information to them. With respect to its Loans, JPMCB shall have the same rights and powers under this Agreement as any other Lender and may exercise such rights and powers as though it were not the Administrative Agent, an L/C Issuer, the Swingline Lender or a Collateral Agent, and the terms “Lender” and “Lenders” include JPMCB in its individual capacity.

Section 8.09 Successor Agents. Each of the Administrative Agent and the Collateral Agent may resign as Administrative Agent (as to one or more Classes) or Collateral Agent, as applicable, upon 30 days’ notice to the Lenders and the Borrowers; provided that any such resignation by JPMCB shall also constitute its resignation as L/C Issuer and Swingline Lender. If the Administrative Agent and/or Collateral Agent becomes a Defaulting Lender, then such Administrative Agent or Collateral Agent, as the case may be, may be removed as the Administrative Agent or Collateral Agent, as the case may be, at the reasonable request of the Canadian Borrower and the Required Lenders. Upon any such resignation or removal, the Required Lenders of the applicable Class or Classes shall have the right, in consultation with the Borrowers, to appoint a successor Administrative Agent, which shall be a bank with an office in the United States, or an Affiliate of any such bank with an office in the United States. Upon any such resignation or removal, the Required Lenders shall have the right, in consultation with the Borrowers, to appoint a successor Collateral Agent, which shall be a bank with an office in the United States, or an Affiliate of any such bank with an office in the United States. If no successor Agent shall have been so appointed, and shall have accepted such appointment, within 30 days after the retiring Agent’s giving of notice of resignation, then the retiring Agent may, on behalf of the Lenders of the applicable Class or Classes, appoint a successor Administrative Agent or

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Collateral Agent, as the case may be, selected from among the Lenders, and meeting the qualifications set forth above. In any case, such appointment shall be subject to the prior written approval of the Borrowers (which approval may not be unreasonably withheld and shall not be required upon the occurrence and during the continuance of an Event of Default). Upon the acceptance of any appointment as Administrative Agent or Collateral Agent by a successor Agent, such successor Agent shall succeed to, and become vested with, all the rights, powers, privileges and duties of the retiring Agent, and the retiring Agent shall be discharged from its duties and obligations under this Agreement and the other Loan Documents. Prior to any retiring Agent’s resignation hereunder as Administrative Agent or Collateral Agent, the retiring Agent shall take such action as may be reasonably necessary to assign to the successor Agent its rights as Administrative Agent or Collateral Agent, as the case may be, under the Loan Documents. After such resignation, the retiring Agent shall continue to have the benefit of this Article VIII as to any actions taken or omitted to be taken by it while it was an Agent under this Agreement and the other Loan Documents. Upon the acceptance of its appointment as successor Agent hereunder, the Person acting as such successor Agent shall succeed to all the rights, powers and duties of the retiring Agent (and, if applicable, L/C Issuer and Swingline Lender) and the respective terms “Administrative Agent,” “L/C Issuer,” “Swingline Lender,” and “Collateral Agent” shall mean such successor Administrative Agent, L/C Issuer, Swingline Lender or Collateral Agent, and the retiring Administrative Agent’s appointment, powers and duties as Administrative Agent shall be terminated, the retiring L/C Issuer’s and Swingline Lender’s rights, powers and duties as such shall be terminated and the retiring Collateral Agent’s rights, powers and duties as such shall be terminated shall be terminated, without any other or further act or deed on the part of such retiring Administrative Agent, L/C Issuer, Swingline Lender, Collateral Agent or any other Lender, other than the obligation of the successor L/C Issuer to issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or to make other arrangements satisfactory to the retiring L/C Issuer to effectively assume the obligations of the retiring L/C Issuer with respect to such Letters of Credit. After any retiring Administrative Agent’s or Collateral Agent’s resignation hereunder as Administrative Agent or Collateral Agent, as applicable, the provisions of this Article VIII and Sections 9.05 and 9.24 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent or Collateral Agent under this Agreement. If no successor administrative agent has accepted appointment as Administrative Agent by the date which is 30 days following a retiring or removed Administrative Agent’s notice of resignation or removal, the retiring Administrative Agent’s resignation or removal shall nevertheless thereupon become effective and the Lenders shall 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. If no successor Collateral Agent has accepted appointment as Collateral Agent by the date which is 30 days following a retiring or removed Collateral Agent’s notice of resignation or removal, the retiring or removed Collateral Agent’s resignation or removal shall nevertheless thereupon become effective and the Lenders shall perform all of the duties of the Collateral Agent hereunder until such time, if any, as the Required Lenders appoint a successor agent as provided for above.

Any resignation or replacement of JPMCB as Administrative Agent pursuant to this Section shall also constitute its resignation or replacement as L/C Issuer and Swingline Lender. If JPMCB resigns or is replaced as L/C Issuer, it shall retain all the rights, powers, privileges and duties of the L/C Issuer hereunder with respect to all Letters of Credit outstanding as of the effective date of its resignation or replacement as L/C Issuer and all L/C Obligations with respect thereto, including the right to require the Lenders to make Revolving R-3 Facility Loans or fund risk participations in Unpaid Drawings. After such resignation or replacement, JPMCB shall not be required to issue additional Letters of Credit or amend or renew Existing Letters of Credit or issue additional Swingline Loans. If JPMCB resigns as Swingline Lender, it shall retain all the rights of the Swingline Lender provided for hereunder with respect to Swingline Loans made by it and outstanding as of the effective date of such resignation, including the right to require the Lenders to make Revolving R-3 Facility Loans or fund risk participations in outstanding Swingline Loans. Upon the appointment by the Canadian Borrower of a successor L/C Issuer or Swingline Lender hereunder (which successor shall in all cases be a Lender other than a Defaulting Lender), (a) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring L/C Issuer or Swingline Lender, as applicable, (b) the retiring L/C Issuer and Swingline Lender shall be discharged from all of their respective duties and obligations hereunder or under the other Loan Documents, and (c) the successor L/C Issuer shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or make other arrangements satisfactory to JPMCB to effectively assume the obligations of JPMCB with respect to such Letters of Credit.

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Section 8.10 Administrative Agent May File Proofs of Claim. In case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial proceeding relative to any Loan Party, the Administrative Agent (irrespective of whether the principal of any Loan or L/C Obligation shall then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on the Borrowers) shall be entitled and empowered, by intervention in such proceeding or otherwise:

(i) to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans, L/C Obligations and all other Secured Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the claims of the Lenders and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Lenders and the Administrative Agent and their respective agents and counsel and all other amounts due the Lenders and the Administrative Agent under Sections 2.12 and 9.24) allowed in such judicial proceeding; and

(ii) to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Lender to make such payments to the Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such payments directly to the Lenders, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements and advances of the Administrative Agent and its agents and counsel, and any other amounts due the Administrative Agent under Sections 2.13 and 9.05.

Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on behalf of any Lender any plan of reorganization, arrangement, adjustment or composition affecting the Secured Obligations or the rights of any Lender or to authorize the Administrative Agent to vote in respect of the claim of any Lender in any such proceeding.

Section 8.11 Collateral and Guaranty Matters.

(a) Actions Taken by Agents or Required Lenders. Each Lender and each L/C Issuer agrees that any action taken by the Collateral Agent or the Required Lenders (or, where required by the express terms of this Agreement, a greater or lesser proportion of the Lenders) in accordance with the provisions of this Agreement or of the other Loan Documents, and the exercise by the Collateral Agent or Required Lenders (or, where so required, such greater or lesser proportion) of the powers set forth herein or therein, together with such other powers as are reasonably incidental thereto, shall be authorized and binding upon all of the Lenders, L/C Issuers, Secured Parties. Without limiting the generality of the foregoing, (i) the Administrative Agent shall have the sole and exclusive right and authority to act as the disbursing and collecting agent for the Lenders and the L/C Issuers with respect to all payments and collections arising in connection herewith and with the Security Documents, (ii) the Collateral Agent shall have the sole authority to (A) execute and deliver each Security Document and accept delivery of each such agreement delivered by the Borrowers or any of its Subsidiaries, (B) act as Collateral Agent for the Lenders, the L/C Issuers, the Secured Parties for purposes of the perfection of all security interests and Liens created by such agreements and all other purposes stated therein; provided, however, that the Collateral Agent hereby appoints, authorizes and directs each Lender and L/C Issuer to act as collateral sub-agent for the Collateral Agent, the Lenders and the L/C Issuers for purposes of the perfection of all security interests and Liens with respect to the Collateral, including any deposit accounts maintained by a Loan Party with, and cash and Cash Equivalents held by, such Lender or such L/C Issuer, (C) manage, supervise and otherwise deal with the Collateral, (D) take such action as is necessary or desirable to maintain the perfection and priority of the security interests and Liens created or purported to be created by the Security Documents and (E) except as may be otherwise specifically restricted by the terms hereof or of any other Loan Document, exercise to the exclusion of the other Secured Parties all remedies given to the Collateral Agent, the Lenders, the L/C Issuers, and the other Secured Parties with respect to the Collateral under the Loan Documents relating thereto, applicable law or otherwise.

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(b) Certain Actions in Respect of Security Interests and Guarantees. The Lenders irrevocably authorize the Administrative Agent or Collateral Agent, as applicable, at its option and in its discretion:

(i) to release or subordinate any Lien or release any Guarantor, in each case, to the extent permitted or required pursuant to Section 9.18 and to take any other action, approved, authorized or ratified in writing by the Required Lenders in accordance with Section 9.08; and

(ii) in connection with the incurrence by the Borrowers or any Restricted Subsidiary of any Indebtedness that is secured by Liens permitted by clauses (6) (to the extent securing Indebtedness incurred under clause (a) or, with respect to the Senior Secured Notes, (b) of the definition of Permitted Debt) or (29) of the definition of Permitted Liens, at the request of Canadian Borrower, the Administrative Agent (including in its capacity as “collateral agent” under the Loan Documents) agrees to execute and deliver a Customary Intercreditor Agreement and any amendments, amendments and restatements, restatements or waivers of or supplements thereto. In connection with any such amendment, restatement, waiver, supplement or other modification, the Loan Parties shall deliver such officers’ certificates and supporting documentation as the Administrative Agent may reasonably request. The Lenders hereby authorize the Administrative Agent to take any action contemplated by the preceding sentence, and any such amendment, amendment and restatement, restatement, waiver of or supplement to or other modification of any such Loan Document shall be effective notwithstanding the provisions of Section 9.08.

(c) Upon request by the Administrative Agent at any time, the Required Lenders will confirm in writing the authority of the Administrative Agent or the Collateral Agent, as applicable, to take any action permitted under this Section 8.11.

Section 8.12 Other Agents; Arrangers and Managers. None of the Lenders or other Persons identified on the facing page or signature pages of this Agreement as a “Syndication Agent,” “Joint Book Runner,” or “Joint Lead Arranger” shall have any right, power, obligation, liability, responsibility or duty under this Agreement other than, in the case of such Lenders, those applicable to all Lenders as such. Without limiting the foregoing, none of the Lenders or other Persons so identified shall have or be deemed to have any fiduciary relationship with any Lender. Each Lender acknowledges that it has not relied, and will not rely, on any of the Lenders or other Persons so identified in deciding to enter into this Agreement or in taking or not taking action hereunder.

Section 8.13 Certain ERISA Matters.

(a) Each Lender (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent and not, for the avoidance of doubt, to or for the benefit of the Borrowers or any other Loan Party, that at least one of the following is and will be true:

(i) such Lender is not using “plan assets” (within the meaning of Section 3(42) of ERISA or otherwise) of one or more Benefit Plans with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments or this Agreement,

(ii) the transaction exemption set forth in one or more PTEs, such as PTE 84-14 (a class exemption for certain transactions determined by independent qualified professional asset managers), PTE 95-60 (a class exemption for certain transactions involving insurance company general accounts), PTE 90-1 (a class exemption for certain transactions involving insurance company pooled separate accounts), PTE 91-38 (a class exemption for certain transactions involving bank collective investment funds) or PTE 96-23 (a class exemption for certain transactions determined by in-house asset managers), is applicable with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement,

(iii) (A) such Lender is an investment fund managed by a “Qualified Professional Asset Manager” (within the meaning of Part VI of PTE 84-14), (B) such Qualified Professional Asset Manager made the investment decision on behalf of such Lender to enter into, participate in, administer and perform

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the Loans, the Letters of Credit, the Commitments and this Agreement, (C) the entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement satisfies the requirements of sub-sections (b) through (g) of Part I of PTE 84-14 and (D) to the best knowledge of such Lender, the requirements of subsection (a) of Part I of PTE 84-14 are satisfied with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement, or

(iv) such other representation, warranty and covenant as may be agreed in writing between the Administrative Agent, in its sole discretion, and such Lender.

(b) In addition, unless either (1) sub-clause (i) in the immediately preceding clause (a) is true with respect to a Lender or (2) a Lender has provided another representation, warranty and covenant in accordance with sub-clause (iv) in the immediately preceding clause (a), such Lender further (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the Administrative Agent and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Loan Party, that the Administrative Agent is not a fiduciary with respect to the assets of such Lender involved in such Lender’s entrance into, participation in, administration of and performance of the Loans, the Letters of Credit, the Commitments and this Agreement (including in connection with the reservation or exercise of any rights by the Administrative Agent under this Agreement, any Loan Document or any documents related hereto or thereto).

ARTICLE IX

MISCELLANEOUS

Section 9.01 Notices.

(a) General. Unless otherwise expressly provided herein, all notices and other communications provided for hereunder or any other Loan Document shall be in writing (including by facsimile transmission). All such written notices shall be mailed, faxed or delivered to the applicable address, facsimile number or electronic mail address, as follows:

(i) if to the Borrowers, the Administrative Agent, the L/C Issuer or the Swingline Lender, to the address, facsimile number or electronic mail address specified for such Person on Schedule 9.01 or to such other address, facsimile number or electronic mail address as shall be designated by such party in a notice to the other parties; and

(ii) if to any other Lender, to the address, facsimile number or electronic mail address specified in its Administrative Questionnaire or to such other address, facsimile number or electronic mail address as shall be designated by such party in a notice to the Borrowers, the Administrative Agent, the L/C Issuer and the Swingline Lender.

All such notices and other communications shall be deemed to be given or made upon the earlier to occur of (i) actual receipt by the relevant party hereto and (ii) (A) if delivered by hand or by courier, when signed for by or on behalf of the relevant party hereto; (B) if delivered by mail, four (4) Business Days after deposit in the mails, postage prepaid; (C) if delivered by facsimile, when sent and receipt has been confirmed; and (D) if delivered by electronic mail, when delivered; provided that notices and other communications to the Administrative Agent, the L/C Issuer and the Swingline Lender pursuant to Article 2 shall not be effective until actually received by such Person. In no event shall a telephone or voice-mail message be effective as a notice, communication or confirmation hereunder.

(b) Effectiveness of Facsimile Documents and Signatures. Loan Documents may be transmitted and/or signed by facsimile. The effectiveness of any such documents and signatures shall, subject to applicable Law, have the same force and effect as manually signed originals and shall be binding on all Loan Parties, the Agents and the Lenders. The Administrative Agent may also require that any such documents and signatures be confirmed by a

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manually signed original thereof; provided that the failure to request or deliver the same shall not limit the effectiveness of any facsimile document or signature.

(c) Reliance by Agents and Lenders. The Administrative Agent and the Lenders shall be entitled to rely and act upon any notices (including telephonic Borrowing Requests and Swingline Borrowing Requests) purportedly given by or on behalf of the Borrowers even if (i) such notices were not made in a manner specified herein, were incomplete or were not preceded or followed by any other form of notice specified herein, or (ii) the terms thereof, as understood by the recipient, varied from any confirmation thereof. The Borrowers shall indemnify each Agent-Related Person and each Lender from all losses, costs, expenses and liabilities resulting from the reliance by such Person on each notice purportedly given by or on behalf of the Borrowers in accordance with Section 9.05.

Section 9.02 Survival of Agreement. All covenants, agreements, representations and warranties made by the Loan Parties herein, in the other Loan Documents and in the certificates or other instruments prepared or delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the Lenders and each L/C Issuer and shall survive the making by the Lenders of the Loans, the execution and delivery of the Loan Documents and the issuance of the Letters of Credit, regardless of any investigation made by such persons or on their behalf, and shall continue in full force and effect as long as the principal of or any accrued interest on any Loan or L/C Disbursement or any Fee or any other amount payable under this Agreement or any other Loan Document is outstanding and unpaid or any Letter of Credit is outstanding and so long as the Commitments have not been terminated. Without prejudice to the survival of any other agreements contained herein, indemnification and reimbursement obligations contained herein (including pursuant to Sections 2.16, 2.17, 2.18 and 9.05) shall survive the payment in full of the principal and interest hereunder, the expiration of the Letters of Credit and the termination of the Commitments or this Agreement.

Section 9.03 Binding Effect. This Agreement shall become effective when it shall have been executed by each of the Loan Parties and the Administrative Agent and when the Administrative Agent shall have received copies hereof which, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the applicable Loan Party, each L/C Issuer, the Administrative Agent and each Lender and their respective permitted successors and assigns.

Section 9.04 Successors and Assigns.

(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 any L/C Issuer that issues any Letter of Credit), except that (i) other than as permitted by Section 6.03, no Borrower may 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 a 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. Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective successors and assigns permitted hereby (including any Affiliate of any L/C Issuer that issues any Letter of Credit), Loan Participants (to the extent provided in paragraph (c) of this Section) and, to the extent expressly contemplated hereby, the Related Parties of each of the Agents, each L/C Issuer and the Lenders) any legal or equitable right, remedy or claim under or by reason of this Agreement.

(b)

(i) Subject to the conditions set forth in paragraph (b)(ii) below, any Lender may assign to one or more assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and/or the Loans at the time owing to it) with the prior written consent (such consent not to be unreasonably withheld or delayed) of:

(A) the Canadian Borrower; provided that no consent of the Canadian Borrower shall be required for an assignment (x) of any Term Loan to a Lender or an Affiliate of a Lender or an Approved Fund (unless increased costs would result therefrom), (y) of any Term Loan, Revolving R-3 Facility Commitment and/or Revolving R-3 Facility Loan by Goldman Sachs Bank

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USA to Goldman Sachs Lending Partners LLC or (z) if an Event of Default under Sections 7.01(b), (c), (h) or (i) has occurred and is continuing, any other assignee (provided that any liability of the Borrowers to an assignee that is an Approved Fund or Affiliate of the assigning Lender under Section 2.16, 2.17 or 2.18 shall be limited to the amount, if any, that would have been payable hereunder by such Borrower in the absence of such assignment, except to the extent the assignee’s entitlement to a greater payment results from a Change in Law after the assignment); provided, further, that the Canadian Borrower shall be deemed to have consented to any assignment of a Term Loan unless it shall object to such assignment by written notice to the Administrative Agent within ten Business Days after having received notice of such assignment; provided, further, that it shall be understood that, without limitation, the Canadian Borrower shall have the right to withhold its consent to any assignment if, in order for such assignment to comply with applicable law, the Canadian Borrower would be required to obtain the consent of, or make any filing or registration with, any Governmental Authority; and

(B) the Administrative Agent; provided that no consent of the Administrative Agent shall be required for an assignment of (i) a Revolving R-3 Facility Commitment and/or Revolving R-3 Facility Loan to an assignee that is a Lender with a Revolving R-3 Facility Commitment and/or Revolving R-3 Facility Loan immediately prior to giving effect to such assignment, or (ii) a Term Loan to a Lender, an Affiliate of a Lender or Approved Fund immediately prior to giving effect to such assignment or (iii) of Loans to any Purchasing Borrower Party or any Affiliated Lender; and

(C) in the case of an assignment of Revolving R-3 Facility Loans and/or Commitments, the L/C Issuer; provided that no consent of the L/C Issuer shall be required for an assignment of (i) a Revolving R-3 Facility Commitment and/or Revolving R-3 Facility Loan to an assignee that is a Lender with a Revolving R-3 Facility Commitment and/or Revolving R-3 Facility Loan, immediately prior to giving effect to such assignment, or (ii) of Loans to any Affiliated Lender.

Notwithstanding the foregoing or anything to the contrary set forth herein, any assignment of any Loans to a Purchasing Borrower Party or any Affiliated Lender shall also be subject to the requirements of Section 9.04(e).

(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 Commitment, the amount of the commitment of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Acceptance with respect to such assignment is delivered to the Administrative Agent) shall not be less than (x) $5,000,000, in the case of Revolving R-3 Facility Commitments or Revolving R-3 Facility Loans and (y) $1,000,000 in the case of Term Loans, unless each of the Canadian Borrower and the Administrative Agent otherwise consent; provided that multiple contemporaneous assignments by Approved Funds may be aggregated for the purpose of compliance with clauses (x) and (y) above; and further provided that no such consent of the Canadian Borrower shall be required if an Event of Default under paragraph (b), (c), (h) or (i) of Section 7.01 has occurred and is continuing; and

(B) each partial assignment shall be made as an assignment of a proportionate part of the assigning Lender’s rights and obligations being so assigned under this Agreement;

(C) the parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Acceptance, together with a processing and recordation fee of $3,500; and

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(D) no assignment shall be made to any Disqualified Lender, it being understood that the Administrative Agent and any Lender may share the list of Disqualified Lenders with any Lender or potential Lender at any time in their sole discretion.

(iii) Subject to acceptance and recording thereof pursuant to paragraphs (b)(i) and (b)(iv) of this Section, from and after the effective date specified in each Assignment and Acceptance, the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Acceptance, have the rights and obligations of a Lender under this Agreement, and the assigning Lender hereunder shall, to the extent of the interest assigned by such Assignment and Acceptance, be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance 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 2.16, 2.17, 2.18 and 9.05). Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section 9.04 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 a non-fiduciary agent of the Borrowers, shall maintain at one of its offices a copy of each Assignment and Acceptance delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitment of, and principal amount (and stated interest) of the Loans and L/C Disbursements 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 Borrowers, the Agents, each L/C Issuer and the Lenders shall 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. The Register shall be available for inspection by the Borrowers and any Lender (solely with respect to its own outstanding Loans and Commitments), at any reasonable time and from time to time upon reasonable prior notice.

(v) Upon its receipt of a duly completed Assignment and Acceptance executed by an assigning Lender and an assignee and any written consent to such assignment required by paragraph (b) of this Section, the Administrative Agent acting for itself and, in any situation wherein the consent of the Canadian Borrower is not required, the Canadian Borrower shall accept such Assignment and Acceptance 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 Canadian Borrower, the Administrative Agent, any L/C Issuer or any Swingline Lender, sell participations to one or more banks or other entities (a “Loan Participant”) in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of its Commitment 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 Borrowers, the Agents, each L/C Issuer 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 or instrument (oral or written) pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and the other Loan Documents and to approve any amendment, modification or waiver of any provision of this Agreement and the other Loan Documents; provided that (x) such agreement or instrument may provide that such Lender will not, without the consent of the Loan Participant, agree to any amendment, modification or waiver described in Section 9.04(a)(i) or clauses (i), (ii), (iii), (iv) or (v) of the first proviso to Section 9.08(b) that affects such Loan Participant and (y) no other agreement (oral or written) with respect to such participation may exist between such Lender and such Loan Participant. Subject to paragraph (c)(ii) of this Section, each of the Borrowers agree that each Loan Participant shall be entitled to the benefits of Sections 2.16, 2.17 and 2.18 (subject to the requirements and limitations therein, including the requirements under Section 2.18(e)) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section (provided that

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any documentation required pursuant to Section 2.18(e) shall be provided solely to the participating Lender). Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrowers, maintain a register on which it enters the name and address of each Loan Participant and the principal and interest amounts of each Loan Participant’s interest in the Loans held by it (the “Participant Register”). The entries in the Participant Register shall be conclusive, absent manifest error, and such Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such Loan or other obligation hereunder for all purposes of this Agreement notwithstanding any notice to the contrary. To the extent permitted by law, each Loan Participant also shall be entitled to the benefits of Section 9.06 as though it were a Lender; provided such Loan Participant agrees to be subject to Section 2.19(e) as though it were a Lender.

(ii) A Loan Participant shall not be entitled to receive any greater payment under Section 2.16, 2.17 or 2.18 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Loan Participant, except to the extent that the entitlement to any greater payment results from any Change in Law after the Person becomes a Loan Participant, unless the sale of the participation to such Loan Participant is made with the Canadian Borrower’s prior written consent.

(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 (i) any pledge or assignment to secure obligations to a Federal Reserve Bank or central bank and (ii) in the case of any Lender that is an Approved Fund, any pledge or assignment to any holders of obligations owed, or securities issued, by such Lender including to any trustee for, or any other representative of, such holders, 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)

(i) Notwithstanding anything else to the contrary contained in this Agreement, any Lender may assign all or a portion of its Term Loans to any Purchasing Borrower Party or any Affiliated Lender in accordance with Section 9.04(b) (which assignment, if to a Purchasing Borrower Party, will not, except for purposes of making the calculations set forth in Section 2.12(d), constitute a prepayment of Loans for any purposes of this Agreement and the other Loan Documents); provided that:

(A) with respect to any assignment to a Purchasing Borrower Party, no Event of Default has occurred or is continuing or would result therefrom;

(B) with respect to any such assignment to a Purchasing Borrower Party, either (x) such Purchasing Borrower Party shall offer to all Lenders within any Class of Term Loans (but not, for the avoidance of doubt, to every Class) to buy the Term Loans within such Class on a pro rata basis based on the then outstanding principal amount of all Term Loans of such Class, pursuant to procedures to be reasonably agreed between the Administrative Agent and the Canadian Borrower or (y) such assignment shall be effected pursuant to an open market purchase;

(C) the assigning Lender and Purchasing Borrower Party or Non-Debt Fund Affiliate purchasing such Lender’s Term Loans, as applicable, shall execute and deliver to the Administrative Agent an assignment agreement substantially in the form of Exhibit Q or such other form as shall be reasonably acceptable to the Canadian Borrower and the Administrative Agent (an “Affiliated Lender Assignment and Acceptance”) in lieu of an Assignment and Acceptance;

(D) for the avoidance of doubt, Lenders shall not be permitted to assign Revolving R-3 Facility Commitments, Revolving R-3 Facility Loans, Extended Revolving Credit Commitments or Extended Revolving Credit Loans to any Purchasing Borrower Party or any Affiliated Lender;

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(E) any Term Loans assigned to any Purchasing Borrower Party shall be automatically and permanently cancelled upon the effectiveness of such assignment and will thereafter no longer be outstanding for any purpose hereunder;

(F) no Purchasing Borrower Party may use the proceeds from Revolving R-3 Facility Loans, Extended Revolving Credit Loans or Swingline Loans to purchase any Term Loans;

(G) no Term Loan may be assigned to a Non-Debt Fund Affiliate pursuant to this Section 9.04(e) if, after giving pro forma effect to such assignment, Non-Debt Fund Affiliates in the aggregate would own in excess of 25% of the Term Loans of any Class then outstanding (determined as of the time of such purchase); and

(H) any purchases or assignments of Loans by a Purchasing Borrower Party or a Non-Debt Fund Affiliate made through “dutch auctions” shall (i) be conducted pursuant to procedures to be established by the applicable “auction agent” that are consistent with this Section 9.04(e) and are otherwise reasonably acceptable to the Canadian Borrower and (ii) require that such Person clearly identify itself as a Purchasing Borrower Party or an Affiliated Lender, as the case may be, in any assignment and acceptance agreement executed in connection with such purchases or assignments.

(ii) Notwithstanding anything to the contrary in this Agreement, no Non-Debt Fund Affiliate shall have any right to (A) attend (including by telephone) any meeting or discussions (or portion thereof) among the Administrative Agent, the Collateral Agent or any Lender to which representatives of the Loan Parties are not invited, (B) receive any information or material prepared by the Administrative Agent, the Collateral Agent or any Lender or any communication by or among the Administrative Agent, the Collateral Agent and/or one or more Lenders, except to the extent such information or materials have been made available to any Loan Party or its representatives (and in any case, other than the right to receive notices of prepayments and other administrative notices in respect of its Loans required to be delivered to Lenders pursuant to Sections 2 of this Agreement) or (C) make or bring (or participate in, other than as a passive participant in or recipient of its pro rata benefits of) any claim, in its capacity as a Lender, against the Administrative Agent or the Collateral Agent with respect to any duties or obligations or alleged duties or obligations of such Agent under the Loan Documents or to challenge such Agent’s attorney-client privilege.

(iii) By its acquisition of Term Loans, a Non-Debt Fund Affiliate shall be deemed to have acknowledged and agreed that if a case under the U.S. Bankruptcy Code is commenced against any Loan Party, such Loan Party shall seek (and each Non-Debt Fund Affiliate shall consent) to provide that the vote of any Non-Debt Fund Affiliate (in its capacity as a Lender) with respect to any plan of reorganization or liquidation of such Loan Party shall not be counted except that such Non-Debt Fund Affiliate’s vote (in its capacity as a Lender) may be counted to the extent any such plan of reorganization or liquidation proposes to treat the Obligations held by such Non-Debt Fund Affiliate in a manner that is less favorable to such Non-Debt Fund Affiliate than the proposed treatment of similar Obligations held by Lenders that are not Affiliates of the Canadian Borrower; each Non-Debt Fund Affiliate hereby irrevocably appoints the Administrative Agent (such appointment being coupled with an interest) as such Non-Debt Fund Affiliate’s attorney-in-fact, with full authority in the place and stead of such Non-Debt Fund Affiliate and in the name of such Non-Debt Fund Affiliate (solely in respect of Loans and participations therein and not in respect of any other claim or status such Non-Debt Fund Affiliate may otherwise have) from time to time in the Administrative Agent’s discretion to take any action and to execute any instrument that the Administrative Agent may deem reasonably necessary to carry out the provisions of this clause (iii).

(iv) Any Lender may assign all or a portion of the Term Loans of any Class (but not any Revolving R-3 Facility Commitments, Revolving R-3 Facility Loans, Extended Revolving Credit Loans or Extended Revolving Credit Commitments) held by it to a Debt Fund Affiliate in accordance with Section 9.04(b).

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(f) Notwithstanding any provision to the contrary, any Lender may assign to one or more wholly owned special purpose funding vehicles (each, an “SPV”) all or any portion of its funded Loans (without the corresponding Commitment), without the consent of any Person or the payment of a fee, by execution of a written assignment agreement in a form agreed to by such assigning Lender and such SPV, and may grant any such SPV the option, in such SPV’s sole discretion, to provide the Borrowers all or any part of any Loans that such assigning Lender would otherwise be obligated to make pursuant to this Agreement. Such SPVs shall have all the rights which a Lender making or holding such Loans would have under this Agreement, but no obligations. Any such assigning Lender shall remain liable for all its original obligations under this Agreement, including its Commitment (although the unused portion thereof shall be reduced by the principal amount of any Loans held by an SPV). Notwithstanding such assignment, the Administrative Agent and the Canadian Borrower may deliver notices to such assigning Lender (as agent for the SPV) and not separately to the SPV unless the Administrative Agent and the Canadian Borrower are requested in writing by the SPV to deliver such notices separately to it. Notwithstanding anything herein to the contrary, (i) neither the grant to the SPV nor the exercise by any SPV of such option will increase the costs or expenses or otherwise change the obligations of the Borrower under this Agreement and the other Loan Documents, except, in the case of Sections 2.16, 2.17 or 2.18, where (A) the increase or change results from a Change in Law after the SPV becomes an SPV and the assigning Lender notifies the Canadian Borrower in writing of such increase or change no later than ninety (90) days after such applicable Change in Law or (B) the grant was made with the Canadian Borrower’s prior written consent, (ii) the assigning Lender shall for all purposes, including the approval of any amendment, waiver or other modification of any provision of any Loan Document and the receipt of any notices provided by the Administrative Agent and the Canadian Borrower (as agent for the SPV) remain the Lender of record hereunder and (iii) no SPV shall be liable for any indemnity or similar payment obligation under this Agreement (all liability for which shall remain with the assigning Lender). The Canadian Borrower shall, at the request of any such assigning Lender, execute and deliver to such Person as such assigning Lender may designate, a promissory note, substantially in the form of Exhibit E-1 or E-2, as applicable, in the amount of such assigning Lender’s original promissory note to evidence the Loans of such assigning Lender and related SPV.

Section 9.05 Expenses; Indemnity.

(a) The Canadian Borrower agrees to pay all reasonable out-of-pocket expenses incurred by the Administrative Agent in connection with the preparation of this Agreement and the other Loan Documents or the administration of this Agreement and by the Joint Lead Arrangers and their affiliates in connection with the syndication of the Commitments (including expenses incurred prior to the Closing Date in connection with due diligence and the reasonable fees, disbursements and the charges for no more than one counsel in each jurisdiction where Collateral is located) or in connection with any amendments, modifications or waivers of the provisions hereof or thereof (whether or not the Transactions hereby contemplated shall be consummated) or incurred by the Agents and any Lender in connection with the enforcement or protection of their rights in connection with this Agreement and the other Loan Documents, in connection with the Loans made or the Letters of Credit issued hereunder, including the reasonable fees, charges and disbursements of Cahill Gordon & Reindel llp, counsel for the Administrative Agent, and Osler, Hoskin & Harcourt LLP, special Canadian counsel to the Administrative Agent, and, in connection with any such enforcement or protection, the reasonable fees, charges and disbursements of one other counsel (including the reasonable allocated costs of internal counsel if a Lender elects to use internal counsel in lieu of outside counsel) for the Agents, any L/C Issuer or all Lenders (but no more than one such counsel for all Lenders).

(b) Each Borrower agrees to indemnify the Agents, each L/C Issuer, each Lender and each of their respective affiliates, directors, trustees, officers, employees, advisors and agents (each such person being called an “Indemnitee”) against, and to hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses, including reasonable counsel fees, charges and disbursements, incurred by or asserted against any Indemnitee arising out of, in any way connected with, or as a result of (i) any claim, litigation, investigation or proceeding relating to any of the foregoing, whether or not any Indemnitee is a party thereto, (ii) the execution or delivery of this Agreement or any other Loan Document or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto and thereto of their respective obligations thereunder or the consummation of the Transactions and the other transactions contemplated hereby and (iii) the use of the proceeds of the Loans or the use of any Letter of Credit; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses (x) result from the gross negligence, willful misconduct, bad faith or material breach of its obligations under the terms of this Agreement or

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any other Loan Document (as determined in a final and non-appealable judgment of a court of competent jurisdiction) of such Indemnitee (treating, for this purpose only, any Agent, any Joint Lead Arranger, any L/C Issuer, any Lender and any of their respective Related Parties as a single Indemnitee), (y) do not result from any act or omission by any Borrower, its subsidiaries or any of their respective officers, directors, employees, agents, advisors or other representatives or (z) result from any claim, litigation, investigation or proceeding that is brought by an Indemnitee solely against one or more other Indemnitees (and not by one or more Indemnitees against the Administrative Agent or any Joint Lead Arranger in such capacity). Subject to and without limiting the generality of the foregoing sentence, each Borrower agrees to indemnify each Indemnitee against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses, including reasonable counsel or consultant fees, charges and disbursements, incurred by or asserted against any Indemnitee arising out of, in any way connected with, or as a result of (A) any Environmental Claim related in any way to the Canadian Borrower or any of the Subsidiaries, or (B) any actual or alleged presence, Release or threatened Release of Hazardous Materials at, under, on or from any Mortgaged Property or any property owned, leased or operated by any predecessor of the Canadian Borrower or any of the Subsidiaries; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence, willful misconduct, bad faith or material breach (as determined in a final and nonappealable judgment of a court of competent jurisdiction) of such Indemnitee or any of its Related Parties. The provisions of this Section 9.05 shall remain operative and in full force and effect regardless of the expiration of the term of this Agreement, the consummation of the transactions contemplated hereby, the repayment of any of the Obligations, the invalidity or unenforceability of any term or provision of this Agreement or any other Loan Document, or any investigation made by or on behalf of any Agent, any L/C Issuer or any Lender. All amounts due under this Section 9.05 shall be payable on written demand therefor accompanied by reasonable documentation with respect to any reimbursement, indemnification or other amount requested.

(c) Unless an Event of Default shall have occurred and be continuing, each Borrower shall be entitled to assume the defense of any action for which indemnification is sought hereunder with counsel of its choice at its expense (in which case any Borrower shall not thereafter be responsible for the fees and expenses of any separate counsel retained by an Indemnitee except as set forth below); provided, however, that such counsel shall be reasonably satisfactory to each such Indemnitee. Notwithstanding a Borrower’s election to assume the defense of such action, each Indemnitee shall have the right to employ separate counsel and to participate in the defense of such action, and each Borrower shall bear the reasonable fees, costs and expenses of such separate counsel, if (i) the use of counsel chosen by a Borrower to represent such Indemnitee would present such counsel with a conflict of interest; (ii) the actual or potential defendants in, or targets of, any such action include both any Borrower and such Indemnitee and such Indemnitee shall have reasonably concluded that there may be legal defenses available to it that are different from or additional to those available to a Borrower (in which case a Borrower shall not have the right to assume the defense or such action on behalf of such Indemnitee); (iii) either Borrower shall not have employed counsel reasonably satisfactory to such Indemnitee to represent it within a reasonable time after notice of the institution of such action; or (iv) a Borrower shall authorize in writing such Indemnitee to employ separate counsel at such Borrower’s expense. The Borrowers will not be liable under this Agreement for any amount paid by an Indemnitee to settle any claims or actions if the settlement is entered into without such Borrower’s consent, which consent may not be withheld or delayed unless such settlement is unreasonable in light of such claims or actions against, and defenses available to, such Indemnitee.

(d) This Section 9.05 shall not apply to Taxes, other than Taxes in respect of losses, claims, damages, liabilities and related expenses indemnifiable under Section 9.05(b) arising out of any non-Tax claim.

Section 9.06 Right of Set-off. If an Event of Default shall have occurred and be continuing, each Lender, each L/C Issuer and each of their respective Affiliates, is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other indebtedness (including Swap Obligations) at any time held and owing by such Lender, such L/C Issuer, their respective Affiliates and such Swap Counterparties to or for the credit or the account of the Canadian Borrower or any Subsidiary against any of and all the obligations of the Canadian Borrower or any Subsidiary then due and owing under this Agreement or any other Loan Document held by such Lender, such L/C Issuer, their respective Affiliates and such Swap Counterparties, irrespective of whether or not such Lender, such L/C Issuer, their respective Affiliates or such Swap Counterparties shall have made any

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demand under this Agreement or such other Loan Document and although the obligations may be unmatured. The rights of each Lender, each L/C Issuer, each of their respective Affiliates and each Swap Counterparty under this Section 9.06 are in addition to other rights and remedies (including other rights of set-off) that such Lender, such L/C Issuer, their respective Affiliates and such Swap Counterparties may have.

Section 9.07 Applicable Law. THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS (OTHER THAN LETTERS OF CREDIT AND AS EXPRESSLY SET FORTH IN OTHER LOAN DOCUMENTS) SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.

Section 9.08 Waivers; Amendment.

(a) No failure or delay of the Administrative Agent, any L/C Issuer or any Lender in exercising any right or power hereunder or under any Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the Administrative Agent, each L/C Issuer and the Lenders hereunder and under the other Loan Documents are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of this Agreement or any other Loan Document or consent to any departure by any Borrower or any other Loan Party therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) below, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. No notice or demand on any Borrower or any other Loan Party in any case shall entitle such person to any other or further notice or demand in similar or other circumstances.

(b) Except as otherwise set forth herein or in any other Loan Documents, neither this Agreement nor any other Loan Document nor any provision hereof or thereof may be waived, amended or modified except (x) in the case of this Agreement, pursuant to an agreement or agreements in writing entered into by the Borrowers and the Required Lenders and (y) in the case of any other Loan Document, pursuant to an agreement or agreements as provided for therein; provided, however, that no such agreement shall

(i) decrease or forgive the principal amount of, or extend the final maturity of, or decrease the rate of interest on, any Loan or any L/C Disbursement, without the prior written consent of each Lender adversely affected thereby; provided that (x) a waiver of any condition precedent set forth in Section 4 or waiver or amendment of any Default, Event of Default or mandatory prepayment shall not constitute a reduction or forgiveness of principal and (y) and any amendment to the financial definitions in this Agreement shall not constitute a reduction in the rate of interest,

(ii) increase or extend the Commitment of any Lender or decrease the Fees or other fees of any Lender without the prior written consent of each Lender adversely affected thereby (it being understood that waivers or modifications of conditions precedent, covenants, Defaults or Events of Default or of a mandatory reduction in the aggregate Commitments shall not constitute an increase of the Commitments of any Lender),

(iii) extend or waive any scheduled amortization payment or extend any date on which payment of interest on any Loan or any L/C Disbursement is due, without the prior written consent of each Lender adversely affected thereby,

(iv) amend or modify the provisions of Section 2.19(c) in a manner that would by its terms alter the pro rata sharing of payments required thereby, without the prior written consent of each Lender adversely affected thereby,

(v) amend or modify the provisions of this Section or reduce the percentages specified in the definition of the terms “Required Lenders,” “Majority Lenders” or any other provision hereof specifying the number or percentage of Lenders required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder, without the prior written consent of each Lender adversely

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affected thereby (it being understood that, with the consent of the Required Lenders, additional extensions of credit pursuant to this Agreement may be included in the determination of the Required Lenders on substantially the same basis as the Loans and Commitments are included on the Amendment No. 2 Effective Date),

(vi) subject to any applicable Customary Intercreditor Agreement, effect any waiver, amendment or modification to release all or substantially all value of the Collateral or all or substantially all value of the Guarantees, taken as a whole, given by Guarantors under the applicable Security Document, without the prior written consent of each of the Lenders (provided, for the avoidance of doubt, this provision shall not limit those releases that are made pursuant to Section 9.18 in connection with transactions permitted by this Agreement),

(vii) effect any amendment that by its terms directly adversely affects the rights in respect of payments or collateral of Lenders participating in any Facility (to the extent such Lenders are entitled to such payments or collateral) differently from those of Lenders participating in other Facilities, without the consent of majority lenders participating in the adversely affected Facility (it being agreed that the Required Lenders may waive, in whole or in part, any prepayment or Commitment reduction required by Section 2.12 so long as the application of any prepayment or Commitment reduction still required to be made is not changed),

provided, further, that no such agreement shall amend, modify or otherwise affect the rights or duties of the Administrative Agent or a L/C Issuer hereunder without the prior written consent of the Administrative Agent or such L/C Issuer acting as such at the effective date of such agreement, as applicable. Each Lender shall be bound by any waiver, amendment or modification authorized by this Section 9.08 and any consent by any Lender pursuant to this Section 9.08 shall bind any assignee of such Lender. This Agreement and all other Loan Documents may be amended or modified without the consent or signature of the Loan Parties (other than the Borrowers) and, after giving effect to each such amendment and modification, all Loan Documents shall continue in full force and effect except no such amendment, waiver or modification to Article X of this Agreement or any other Loan Document to which such Loan Party is a party may be effective without the consent of such Loan Party. The Canadian Borrower and the Administrative Agent may, without the input or consent of the other Lenders, effect technical changes to this Agreement that are required in connection with a Permitted Change of Control Termination Event.

(c) Without the consent of any Lender, the Loan Parties and the Administrative Agent and/or Collateral Agent may (in their respective sole discretion, or shall, to the extent required by any Loan Document) enter into any amendment, modification or waiver of any Loan Document, or enter into any new agreement or instrument, to effect the granting, perfection, protection, expansion or enhancement of any security interest in any Collateral or additional property to become Collateral for the benefit of the Secured Creditors, or as required by local law to give effect to, or protect any security interest for the benefit of the Secured Creditors, in any property or so that the security interests therein comply with applicable law.

(d) Without the consent of any Lender, the Canadian Borrower and the Administrative Agent and/or Collateral Agent may (in their respective sole discretion) enter into any amendment or modification of any Loan Document to cure any ambiguity, omission, defect or inconsistency (including, without limitation, amendments, supplements or waivers to any of the Security Documents, guarantees, intercreditor agreements or related documents executed by any Loan Party or any other Subsidiary in connection with this Agreement if such amendment, supplement or waiver is delivered in order to cause such Security Documents, guarantees, intercreditor agreements or related documents to be consistent with this Agreement and the other Loan Documents), so long as, in each case, the Lenders shall have received at least five Business Days’ prior written notice thereof and the Administrative Agent shall not have received, within five Business Days of the date of such notice to the Lenders, a written notice from the Required Lenders stating that the Required Lenders object to such amendment.

(e) Notwithstanding the foregoing, this Agreement may be amended (or amended and restated) with the written consent of the Required Lenders, the Administrative Agent, the Borrowers (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

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the other Loan Documents with the Term Loans and the Revolving R-3 Facility Loans 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.

(f) In addition, notwithstanding the foregoing, this Agreement may be amended with the written consent of the Administrative Agent, the Borrowers and the Lenders providing the relevant Replacement Term Loans to permit the refinancing of all outstanding Term Loans (“Refinanced Term Loans”) with replacement term loan tranches hereunder which shall be Loans hereunder (“Replacement Term Loans”); provided that (i) the aggregate principal amount of such Replacement Term Loans shall not exceed the aggregate principal amount of such Refinanced Term Loans, (ii) the Applicable Margin for such Replacement Term Loans shall not be higher than the Applicable Margin for such Refinanced Term Loans, (iii) the Weighted Average Life to Maturity of such Replacement Term Loans shall not be shorter than the Weighted Average Life to Maturity of such Refinanced Term Loans at the time of such refinancing and (iv) all other terms applicable to such Replacement Term Loans shall be substantially identical to, or less favorable to the Lenders providing such Replacement Term Loans than, those applicable to such Refinanced Term Loans, except to the extent necessary to provide for covenants and other terms applicable to any period after the latest final maturity of the Term Loans in effect immediately prior to such refinancing.

(g) Notwithstanding anything to the contrary herein, no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder (and any amendment, waiver or consent which by its terms requires the consent of all Lenders or each affected Lender may be effected with the consent of the applicable Lenders other than Defaulting Lenders), except that (x) the Commitment of such Lender may not be increased or extended without the consent of such Lender (if being understood that a waiver of any condition precedent set forth in Section 4.01 or 4.02 or the waiver of any Default, Event of Default or mandatory prepayment shall not constitute an extension or increase of any Commitment of any Lender) and (y) any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender that by its terms affects any Defaulting Lender more adversely than other affected Lenders shall require the consent of such Defaulting Lender.

(h) Notwithstanding the foregoing, the Administrative Agent and the Collateral Agent may, without the consent of any Lender, enter into any amendment to the Security Documents or a Customary Intercreditor Agreement contemplated hereby.

Notwithstanding anything to the contrary herein, in connection with any determination as to whether the requisite Lenders have directed or required the Administrative Agent to exercise any rights or remedies under Article VII (or under any other Loan Document), any Lender (other than (x) any Lender that is a Regulated Bank and (y) any Revolving R-3 Facility Lender) that, as a result of its interest in any total return swap, total rate of return swap, credit default swap or other derivative contract (other than any such total return swap, total rate of return swap, credit default swap or other derivative contract entered into pursuant to bona fide market making activities), has a net short position that is at least 5% short with respect to the Loans and/or Commitments (each, a “Net Short Lender”) shall, unless the Canadian Borrower otherwise elects (in its sole discretion), have no right, in its capacity as a Lender, to direct or require the Administrative Agent to exercise any rights or remedies under Article VII (or under any other Loan Document) and shall be deemed, in its capacity as a Lender, to have directed or required the Administrative Agent to exercise any rights or remedies under Article VII (or under any other Loan Document) in the same proportion as the allocation of voting with respect to such matter by Lenders who are not Net Short Lenders.

For purposes of determining whether a Lender has a “net short position” on any date of determination: (i) derivative contracts with respect to the Loans and Commitments and such contracts that are the functional equivalent thereof shall be counted at the notional amount thereof in Dollars, (ii) notional amounts in other currencies shall be converted to the Dollar Equivalent thereof by such Lender in a commercially reasonable manner consistent with generally accepted financial practices and based on the prevailing conversion rate (determined on a mid-market basis) on the date of determination, (iii) derivative contracts in respect of an index that includes any of the Canadian Borrower or other Loan Parties or any instrument issued or guaranteed by any of the Canadian Borrower or other Loan Parties shall not be deemed to create a short position with respect to the Loans and/or Commitments, so long as (x) such index is not created, designed, administered or requested by such Lender and (y) the Canadian Borrower and other Loan Parties and any instrument issued or guaranteed by any of the Canadian Borrower or other Loan

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Parties, collectively, shall represent less than 5% of the components of such index, (iv) derivative transactions that are documented using either the 2014 ISDA Credit Derivatives Definitions or the 2003 ISDA Credit Derivatives Definitions (collectively, the “ISDA CDS Definitions”) and for which the Canadian Borrower or any other Loan Party is designated as a “Reference Entity” under the terms of such derivative transactions shall be deemed to create (x) a short position with respect to the Loans and/or Commitments if such Lender is a protection buyer or the equivalent thereof for such derivative transaction and (y) a long position with respect to the Loans and/or Commitments if such Lender is a protection seller or the equivalent thereof for such derivative transaction, (v) credit derivative transactions or other derivatives transactions not documented using the ISDA CDS Definitions shall be deemed to create (x) a short position with respect to the Loans and/or Commitments if such transactions are functionally equivalent to a transaction that offers the Lender protection in respect of the Loans or the Commitments, or as to the credit quality of any of the Canadian Borrower or other Loan Parties and (y) a long position with respect to the Loans and/or Commitments if such transactions are functionally equivalent to a transaction pursuant to which the Lender provides protection in respect to the Loans or the Commitments, or as to the Credit Quality of the Canadian Borrower or other Loan Parties, other than, in each case, as part of an index so long as (1) such index is not created, designed, administered or requested by such Lender and (2) the Canadian Borrower and other Loan Parties and any instrument issued or guaranteed by any of the Canadian Borrower or other Loan Parties, collectively, shall represent less than 5% of the components of such index, (vi) any bond, loan or other credit instrument issued or guaranteed by the Canadian Borrower or any other Loan Party and held by the relevant Lender shall be deemed to create a long position equal to the outstanding principal balance in respect of such instrument, and (vii) any ownership interest in the equity of the Canadian Borrower or any other Loan Party held by the relevant Lender shall be deemed to create a long position equal to the higher of (A) the current market value and (B) the price at which the Lender purchased such equity position. In connection with any such determination, each Lender shall promptly notify the Administrative Agent in writing that it is a Net Short Lender, or shall otherwise be deemed to have represented and warranted to the Canadian Borrower and the Administrative Agent that it is not a Net Short Lender (it being understood and agreed that the Canadian Borrower and the Administrative Agent shall be entitled to rely on each such representation and deemed representation).

Section 9.09 Interest Rate Limitation. Notwithstanding anything herein to the contrary, and without limiting Sections 2.14(f)(ii) through (iv), if at any time the applicable interest rate, together with all fees and charges that are treated as interest under applicable law (collectively, the “Charges”), as provided for herein or in any other document executed in connection herewith, or otherwise contracted for, charged, received, taken or reserved by any Lender or any L/C Issuer, shall exceed the maximum lawful rate (the “Maximum Rate”) that may be contracted for, charged, taken, received or reserved by such Lender in accordance with applicable law, the rate of interest payable hereunder, together with all Charges payable to such Lender or such L/C Issuer, shall be limited to the Maximum Rate; provided that such excess amount shall be paid to such Lender or such L/C Issuer on subsequent payment dates to the extent not exceeding the legal limitation.

Section 9.10 Entire Agreement. This Agreement, the other Loan Documents and the agreements regarding certain Fees referred to herein constitute the entire contract between the parties relative to the subject matter hereof. Any previous agreement among or representations from the parties or their Affiliates with respect to the subject matter hereof is superseded by this Agreement and the other Loan Documents except as expressly set forth in such agreement. Notwithstanding the foregoing, the Fee Letter and any other fee letter related to the Transactions shall survive the execution and delivery of this Agreement and remain in full force and effect. Nothing in this Agreement or in the other Loan Documents, expressed or implied, is intended to confer upon any party other than the parties hereto and thereto any rights, remedies, obligations or liabilities under or by reason of this Agreement or the other Loan Documents.

Section 9.11 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS

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AGREEMENT AND THE OTHER LOAN DOCUMENTS, AS APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 9.11.

Section 9.12 Severability. In the event any one or more of the provisions contained in this Agreement or in any other Loan Document should be held invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein and therein shall not in any way be affected or impaired thereby. The parties shall endeavor in good-faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions.

Section 9.13 Counterparts. This Agreement may be executed in two or more counterparts, each of which shall constitute an original but all of which, when taken together, shall constitute but one contract, and shall become effective as provided in Section 9.03. Delivery of an executed counterpart to this Agreement by facsimile transmission shall be as effective as delivery of a manually signed original.

Section 9.14 Headings. Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and are not to affect the construction of, or to be taken into consideration in interpreting, this Agreement.

Section 9.15 Jurisdiction; Consent to Service of Process.

(a) Each party hereto hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of any New York State court or federal court of the United States of America sitting in New York City, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement or the other Loan Documents, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such federal court. Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.

(b) Each party hereto hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or the other Loan Documents in any New York State or federal court. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

(c) Each Loan Party party hereto irrevocably and unconditionally appoints Corporation Service Company, with an office on the Amendment No. 2 Effective Date at 80 State Street, Albany, NY (Albany County) 12207-2543, and its successors hereunder (the “Process Agent”), as its agent to receive on behalf of each such Loan Party and its property all writs, claims, process, and summonses in any action or proceeding brought against it in the State of New York. Such service may be made by mailing or delivering a copy of such process to the respective Loan Party in care of the Process Agent at the address specified above for the Process Agent, and such Loan Party irrevocably authorizes and directs the Process Agent to accept such service on its behalf. Failure by the Process Agent to give notice to the respective Loan Party, or failure of the respective Loan Party, to receive notice of such service of process shall not impair or affect the validity of such service on the Process Agent or any such Loan Party, or of any judgment based thereon. Each Loan Party party hereto covenants and agrees that it shall take any and all reasonable action, including the execution and filing of any and all documents, that may be necessary to continue the designation of the Process Agent above in full force and effect, and to cause the Process Agent to act as such. Each Loan Party hereto further covenants and agrees to maintain at all times an agent with offices in New York City to act as its Process Agent. Nothing herein shall in any way be deemed to limit the ability to serve any such writs, process or summonses in any other manner permitted by applicable law. Corporation Service Company consents to serve as such agent.

SECTION 9.16 Confidentiality. Each of the Lenders, each L/C Issuer and the Administrative Agent agrees that it shall maintain in confidence any information relating to the Canadian Borrower and the other Loan

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Parties furnished to it by or on behalf of the Canadian Borrower or the other Loan Parties (other than information that (a) has become generally available to the public other than as a result of a disclosure by such party, (b) has been independently developed by such Lender, such L/C Issuer or the Administrative Agent without violating this Section 9.16 or (c) was available to such Lender, such L/C Issuer or the Administrative Agent from a third party having, to such person’s knowledge, no obligations of confidentiality to the Canadian Borrower or any other Loan Party) and shall not reveal the same other than to its directors, trustees, officers, employees and advisors with a need to know or to any person that approves or administers the Loans on behalf of such Lender (so long as each such person shall have been instructed to keep the same confidential in accordance with this Section 9.16), except: (A) to the extent necessary to comply with law or any legal process or the requirements of any Governmental Authority, the National Association of Insurance Commissioners or of any securities exchange on which securities of the disclosing party or any Affiliate of the disclosing party are listed or traded, (B) as part of normal reporting or review procedures to, or as requested in connection with the exercise of its regulatory authority by, any Governmental Authorities or the National Association of Insurance Commissioners, (C) to its parent companies, Affiliates, agents, advisors or auditors (so long as each such person shall have been instructed to keep the same confidential in accordance with this Section 9.16), (D) to any prospective assignee (other than any Disqualified Lender) of, or prospective Loan Participant in, any of its rights under this Agreement (so long as such person shall have been instructed to keep the same confidential in accordance with this Section 9.16), (E) to any direct or indirect contractual counterparty in Swap Agreements or such contractual counterparty’s professional advisor (so long as such contractual counterparty or professional advisor to such contractual counterparty agrees to be bound by the provisions of this Section) and (F) in connection with the enforcement of its rights and exercise of remedies under the Loan Documents in any litigation or proceeding relating thereto, to the extent such disclosure is reasonably necessary in connection with such litigation or proceeding (provided that the Canadian Borrower shall be given notice thereof and a reasonable opportunity to seek a protective court order with respect to such information prior to such disclosure (it being understood that the refusal by a court to grant such a protective order shall not prevent the disclosure of such information thereafter)).

Section 9.17 Conversion of Currencies.

(a) If, for the purpose of obtaining judgment in any court, it is necessary to convert a sum owing hereunder in one currency into another currency, each party hereto agrees, to the fullest extent that it may effectively do so, that the rate of exchange used shall be that at which in accordance with normal banking procedures in the relevant jurisdiction the first currency could be purchased with such other currency on the Business Day immediately preceding the day on which final judgment is given.

(b) The obligations of each Borrower in respect of any sum due to any party hereto or any holder of the obligations owing hereunder (the “Applicable Creditor”) shall, notwithstanding any judgment in a currency (the “Judgment Currency”) other than the currency in which such sum is stated to be due hereunder (the “Agreement Currency”), be discharged only to the extent that, on the Business Day following receipt by the Applicable Creditor of any sum adjudged to be so due in the Judgment Currency, the Applicable Creditor may in accordance with normal banking procedures in the relevant jurisdiction purchase the Agreement Currency with the Judgment Currency; if the amount of the Agreement Currency so purchased is less than the sum originally due to the Applicable Creditor in the Agreement Currency, such Borrower agrees, as a separate obligation and notwithstanding any such judgment, to indemnify the Applicable Creditor against such loss. The obligations of the Borrowers contained in this Section 9.17 shall survive the termination of this Agreement and the payment of all other amounts owing hereunder.

Section 9.18 Release of Liens and Guarantees. In the event that (x) any Loan Party conveys, sells, leases, assigns, transfers or otherwise disposes of all or any portion of any of its assets (including the Equity Interests of any Loan Party) to a person that is not (and is not required to become) a Loan Party in a transaction not prohibited by this Agreement, or (y) any Initial Lien on any assets of a Loan Party which results in a Lien on such assets being granted to secure the Secured Obligations pursuant to the last clause of Section 6.02 shall be discharged, the Liens granted to the Collateral Agent by the Loan Parties on any such assets or Equity Interests shall automatically be released, and the Administrative Agent shall promptly (and the Lenders hereby authorize the Administrative Agent to) take such action and execute any such documents as may be reasonably requested by the Borrowers and at the Canadian Borrower’s expense to evidence and confirm the release of Liens created by any Loan Document in respect of such assets or Equity Interests, and, in the case of a disposition of the Equity Interests of any Subsidiary Loan Party in a transaction permitted by Section 6.03 or 6.04 and as a result of which such Subsidiary Loan Party would cease to be a Subsidiary, or in the case that a Subsidiary is designated as an Unrestricted Subsidiary in accordance

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with this Agreement, or is otherwise not required to be a Guarantor pursuant to Section 5.10(e), such Subsidiary Loan Party’s obligations under its Guarantee and the Loan Documents shall automatically be terminated and the Administrative Agent shall promptly (and the Lenders hereby authorize the Administrative Agent to) take such action and execute any such documents as may be reasonably requested by the Borrowers and at the Canadian Borrower’s expense to evidence and confirm the release of such Subsidiary Loan Party’s obligations under its Guarantee and the Loan Documents.

In addition, the Administrative Agent and the Collateral Agent agree (and the Lenders hereby authorize the Administrative Agent and the Collateral Agent) to take such actions as are reasonably requested by the Borrowers (including the execution and delivery of such documents as Borrowers may reasonably request to evidence the release or subordination of Liens and Guarantees contemplated hereby and in accordance with the Loan Documents) and at the Canadian Borrower’s expense:

(a) to terminate the Liens and security interests created by the Loan Documents (1) when all the Obligations (other than (A) contingent indemnification obligations not yet accrued and payable and (B) those Secured Obligations constituting Cash Management Agreements or Swap Agreements) are paid in full and all Commitments are terminated and all Letters of Credit are either terminated or cash collateralized in full or such other arrangements reasonably satisfactory to the Administrative Agent and the L/C Issuer shall have been made, (2) on assets or property that constitutes “Excluded Collateral” (as such term is defined in the Security Agreement), (3) on assets or property that is excluded pursuant to Section 5.10 or the definition of “Collateral and Guarantee Requirements”, (4) to the extent the property constituting Collateral is owned by any Guarantor, upon the release of such Guarantor from its obligations under the Guarantee and Loan Documents, (5) on each Mortgaged Property set forth on Annex 1(f) to Amendment No. 6, in each case in reliance on the Loan Parties’ representation in the Perfection Certificate dated as of the Amendment No. 6 Effective Date that such properties are not owned or ground leased real properties with a Fair Market Value in excess of $10,000,000, (6) on each Brazilian law governed Quota Pledge Agreement existing on the Amendment No. 6 Effective Date in favor of the Collateral Agent for the benefit of the Secured Creditors, subject in all respects to the execution, delivery and filing with all governmental authorities required to perfect the Liens thereunder, in each case on the date of such release, of each Brazilian law governed Quota Pledge Agreement set forth on Annex 5 to Amendment No. 6 within the time period set forth on such Annex or (7) otherwise, if approved, authorized or ratified in writing in accordance with Section 9.08;

(b) notwithstanding anything to the contrary contained herein or in any other Loan Document, upon the reasonable request of the Canadian Borrower in connection with any Liens permitted by the Loan Documents, the Collateral Agent shall (without notice to, or vote or consent of, any Secured Party) take such actions as shall be required to release (or subordinate if a junior Lien held by the Collateral Agent is permitted under the documents relating to the Lien permitted under Section 6.02) any Lien on any property to or held by the Collateral Agent under any Loan Document to the holder of any Lien on such property that is permitted under Section 6.02 (including any agreement entered into among the Collateral Agent, the Canadian Borrower and Cancom Alta Holdings Inc. (the “Cancom Agreement”) and agreements to implement and recognize any Lien permitted under clause (26) of the definition of Permitted Lien). In addition, notwithstanding anything to the contrary contained herein or in any other Loan Document, upon reasonable request of the Canadian Borrower, the Administrative Agent and the Collateral Agent shall (without notice to, or vote or consent of, any Secured Party) enter into subordination or intercreditor agreements with respect to Indebtedness to the extent the Administrative Agent or Collateral Agent is otherwise contemplated herein as a party to such subordination or intercreditor agreements; and

(c) to release any Guarantor from its obligations under the Loan Documents if such Person ceases to be a Restricted Subsidiary as a result of a transaction or designation permitted hereunder.

The Collateral Agent shall be entitled to release its Lien on any Satellite subject to any Lien permitted under clause (26) of the definition of Permitted Lien, any non-disturbance agreement or the Cancom Agreement if a Governmental Authority requires it or the Lenders to perform any obligations under the relevant non-disturbance, revenue or condosat agreement. Any representation, warranty or covenant contained in any Loan Document relating to any such Equity Interests, asset or subsidiary of the Canadian Borrower shall no longer be deemed to be made

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once such Equity Interests or asset is so conveyed, sold, leased, assigned, transferred or disposed of. The Administrative Agent also agrees to enter into any Customary Intercreditor Agreement in the circumstances and on those terms contemplated by this Agreement and to take such actions (and execute all documents) as are reasonably requested by the Borrowers in connection with such Customary Intercreditor Agreement.

Section 9.19 Patriot Act. Each Lender subject to the Patriot Act, the Beneficial Ownership Regulation or PCTFA hereby notifies the Borrowers that pursuant to the requirements of the Patriot Act, the Beneficial Ownership Regulation or PCTFA, as applicable, it is required to obtain, verify and record information that identifies the Loan Parties and other information that will allow such Lender to identify the Loan Parties in accordance with the Patriot Act, the Beneficial Ownership Regulation or PCTFA, as applicable.

Section 9.20 Regulatory Matters. The Lenders and the Collateral Agent hereby agree that they will not take action pursuant to the Security Documents which would constitute or result in an assignment or a change of control of the FCC Licenses, ISED Authorizations or other governmental permits, licenses, or other authorizations now held by or to be issued to the Canadian Borrower or any of its subsidiaries, that would require prior notice to or approval from a Governmental Authority, without first providing such notice or obtaining such prior approval. The Canadian Borrower agrees to take any action which any Lender may reasonably request in order to obtain from the FCC, U.S. Department of Justice, ISED, CRTC or any other relevant Governmental Authority such approval as may be necessary to enable the Lenders to exercise the full rights and benefits granted to the Lenders pursuant to this Agreement, including the use of the Canadian Borrower’s best efforts to assist in obtaining the approval of the FCC, U.S. Department of Justice, ISED, CRTC or any other relevant Governmental Authority for any action or transaction contemplated by the Security Documents for which such approval is required by law and specifically, without limitation, upon request, to prepare, sign and file with the FCC, U.S. Department of Justice, ISED, CRTC or any other relevant Governmental Authority the assignor’s or transferor’s and licensee’s portions of any application or applications for consent to the assignment or transfer of control of any FCC, U.S. Department of Justice, ISED, CRTC or other governmental construction permit, license or other authorization that may be necessary or appropriate under the rules of the FCC, U.S. Department of Justice, ISED, CRTC or such other Governmental Authority for approval of any sale or transfer of control of the Collateral pursuant to the exercise of the Collateral Agent’s and the Lenders’ rights and remedies under the Security Documents. The Canadian Borrower further consents, subject to obtaining any necessary approvals, to the assignment or transfer of control of any FCC, U.S. Department of Justice, CRTC, ISED Authorizations or other governmental construction permit, license, or other authorization to operate to a receiver, trustee, or similar official or to any purchaser of the Collateral pursuant to any public or private sale, judicial sale, foreclosure, or exercise of other remedies available to the Collateral Agent or Lenders as permitted by applicable law.

Notwithstanding anything herein or in any of the Loan Documents to the contrary, prior to the occurrence of an Event of Default and the consent of the FCC, U.S. Department of Justice, ISED, CRTC and of any other applicable Governmental Authority to the assignment or transfer of control of FCC Licenses, ISED Authorizations, CRTC approvals or other governmental permits, licenses, or other authorizations, including those of any other Governmental Authority, this Agreement, the Security Documents and the transactions contemplated hereby and thereby may not be effectuated if and to the extent they would constitute, create, or have the effect of constituting or creating directly or indirectly, actual or practical ownership of any FCC Licenses, ISED Authorizations, CRTC approvals or other governmental permits, licenses or other authorizations, including those of any other Governmental Authority, by the Secured Creditors, the Collateral Agents or the Administrative Agent or control, affirmative or negative, direct or indirect, by Lenders, the Secured Creditors, the Collateral Agent or the Administrative Agent over the management or any other aspect of the operation of any FCC Licenses, ISED Authorizations, CRTC approvals or other governmental permits, licenses, or other authorizations, including those of any other Governmental Authority.

The exercise of rights by the Lenders under the Security Documents is subject to the provisions of Schedule 1.01(b).

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Section 9.21 Application of Proceeds.

(a) All moneys collected by the Collateral Agent upon any sale or other disposition of any Collateral, together with all other moneys received by the Collateral Agent under any Security Document, shall be applied as follows:

(i) first, to the payment of all amounts owing the Collateral Agent for (x) any and all sums advanced by the Collateral Agent in order to preserve the Collateral or preserve its security interest and other Liens in the Collateral, (y) the reasonable expenses of retaking, holding, preparing for sale or lease, selling or otherwise disposing of or realizing on the Collateral, or of any exercise by the Collateral Agent of its rights under this Agreement or any Security Document, together with reasonable attorneys’ fees and court costs, in each case, in the event of any proceeding for the collection or enforcement of any indebtedness, obligations, or liabilities of the Canadian Borrower or its Subsidiaries and after an Event of Default shall have occurred and be continuing and (z) all amounts paid by the Collateral Agent for which the Collateral Agent is indemnified by the Canadian Borrower or any of its Subsidiaries and for which the Collateral Agent is entitled to reimbursement pursuant to Section 9.05 or the indemnification provisions contained in the Security Documents;

(ii) second, to the extent proceeds remain after the application pursuant to the preceding clause (i), to the payment of all amounts owing to any Agent for (x) all amounts paid by such Agent for which such Agent is indemnified by the Canadian Borrower or any of its Subsidiaries and for which such Agent is entitled to reimbursement pursuant to Section 9.05 or the indemnification provisions contained in the Security Documents and (y) all amounts owing to any Agent pursuant to any of the Loan Documents in its capacity as such;

(iii) third, to the extent proceeds remain after the application pursuant to the preceding clauses (i) and (ii), an amount equal to the outstanding Primary Obligations shall be paid to the Secured Creditors as provided in Section 9.21(d), with each Secured Creditor receiving an amount equal to its outstanding Primary Obligations or, if the proceeds are insufficient to pay in full all such Primary Obligations, its Pro Rata Share of the amount remaining to be distributed;

(iv) fourth, to the extent proceeds remain after the application pursuant to the preceding clauses (i) through (iii), inclusive, an amount equal to the outstanding Secondary Obligations shall be paid to the Secured Creditors as provided in Section 9.21(d), with each Secured Creditor receiving an amount equal to its outstanding Secondary Obligations or, if the proceeds are insufficient to pay in full all such Secondary Obligations, its Pro Rata Share of the amount remaining to be distributed; and

(v) fifth, to the extent proceeds remain after the application pursuant to the preceding clauses (i) through (iv), inclusive, and following the termination of this Agreement and the Security Documents, to the Canadian Borrower or its relevant Subsidiary or to whomever may be lawfully entitled to receive such surplus.

(b) When payments to Secured Creditors are based upon their respective Pro Rata Shares, the amounts received by such Secured Creditors shall be applied (for purposes of making determinations under this Section 9.21 only) (i) first, to their Primary Obligations and (ii) second, to their Secondary Obligations. If any payment to any Secured Creditor of its Pro Rata Share of any distribution would result in overpayment to such Secured Creditor, such excess amount shall instead be distributed in respect of the unpaid Primary Obligations or Secondary Obligations, as the case may be, of the other Secured Creditors, with each Secured Creditor whose Primary Obligations or Secondary Obligations, as the case may be, have not been paid in full to receive an amount equal to such excess amount multiplied by a fraction the numerator of which is the unpaid Primary Obligations or Secondary Obligations, as the case may be, of such Secured Creditor and the denominator of which is the unpaid Primary Obligations or Secondary Obligations, as the case may be, of all Secured Creditors entitled to such distribution.

(c) Each of the Secured Creditors, by their acceptance of the benefits of the Security Documents, agrees and acknowledges that if the Lenders receive a distribution on account of undrawn amounts with respect to

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Letters of Credit issued under this Agreement (which shall only occur after all outstanding Revolving R-3 Facility Loans and unreimbursed L/C Disbursements have been paid in full), such amounts shall be paid to the Administrative Agent and held by it, for the equal and ratable benefit of the Lenders, as cash security for the repayment of all obligations owing to the Lenders as such. If any amounts are held as cash security pursuant to the immediately preceding sentence, then upon the termination of all outstanding Letters of Credit, and after the application of all such cash security to the repayment of all obligations owing to the Lenders after giving effect to the termination of all such Letters of Credit, if there remains any excess cash, such excess cash shall be returned by the Administrative Agent to the Collateral Agent for distribution in accordance with Section 9.21(a).

(d) All payments required to be made hereunder shall be made (x) if to the Lenders, to the Administrative Agent for the account of the Lenders and (y) if to the Swap Counterparties, to the trustee, paying agent or other similar representative (each, a “Representative”) for the Swap Counterparties or, in the absence of such a Representative, directly to the Swap Counterparties.

(e) For purposes of applying payments received in accordance with this Section 9.21, the Collateral Agent shall be entitled to rely upon (i) the Administrative Agent and (ii) the Representative or, in the absence of such a Representative, upon the Swap Counterparties for a determination (which the Administrative Agent, each Representative and the Swap Counterparties agree (or shall agree) to provide upon request of the Collateral Agent) of the outstanding Primary Obligations and Secondary Obligations owed to the Secured Parties. Unless it has received written notice from a Lender or a Swap Counterparty to the contrary, the Administrative Agent and each Representative, in furnishing information pursuant to the preceding sentence, and the Collateral Agent, in acting hereunder, shall be entitled to assume that no Secondary Obligations are outstanding.

(f) It is understood that the Canadian Borrower and the other Loan Parties shall remain jointly and severally liable to the extent of any deficiency between the amount of the proceeds of the Collateral and the aggregate amount of the Secured Obligations (other than (A) contingent indemnification obligations not yet accrued and payable and (B) those Secured Obligations constituting Cash Management Agreements or Swap Agreements).

Section 9.22 Withholding Tax.

(a) If the Internal Revenue Service, Canada Revenue Agency or any authority of the United States of America, Canada or any other jurisdiction asserts a claim that the Administrative Agent did not properly withhold Tax from amounts paid to or for the account of any Lender for any reason (including because the appropriate form was not delivered or was not properly executed, or because such Lender failed to notify the Administrative Agent of a change in circumstances that rendered the exemption from, or reduction of, withholding Tax ineffective), or if the Administrative Agent reasonably determines that a payment was made to a Lender pursuant to any Loan Document without deduction of applicable withholding Tax from such payment, such Lender shall indemnify the Administrative Agent (to the extent that the Administrative Agent has not already been reimbursed and without limiting the obligation of any applicable Loan Party to do so) fully for all amounts paid, directly or indirectly, by the Administrative Agent as Tax or otherwise, including penalties and interest, together with all expenses incurred, including legal expenses, allocated staff costs and any out of pocket expenses, whether or not such Tax was correctly or legally imposed or asserted. A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under this Agreement or any other Loan Document against any amount due to the Administrative Agent under this Section 9.22.

(b) The agreements in this Section 9.22 shall survive the resignation of the Administrative Agent, the replacement of any Lender, the termination of this Agreement, the termination of the Commitments and the repayment, satisfaction or discharge of all other Obligations.

(c) For the avoidance of doubt, the term “Lender,” for purposes of this Section 9.22, shall include any Swingline Lender and any L/C Issuer.

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Section 9.23 Intercreditor Agreement Authorization. Each Lender hereby agrees that it will be bound by, and will take no actions contrary to, the provisions of any Customary Intercreditor Agreement contemplated hereby. Each Lender authorizes and instructs the Administrative Agent and the Collateral Agent to enter into any Customary Intercreditor Agreement on behalf of such Lender and to take all actions (and execute all documents) required (or deemed advisable) by the Administrative Agent or the Collateral Agent in accordance with the terms of such Customary Intercreditor Agreement.

Section 9.24 Obligations of the Borrowers Joint and Several. With respect to the Term B-5 Loans made hereunder, each of the Canadian Borrower and the U.S. Borrower hereby acknowledges that such Loans are made for the benefit of each of the Canadian Borrower and the U.S. Borrower and, in consideration thereof, agrees to be jointly and severally liable with each other for such Loans and the Obligations related thereto.

Section 9.25 Acknowledgement and Consent to Bail-In of EEA Financial Institutions. Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among any such parties, each party hereto acknowledges that any liability of any EEA Financial Institution arising under any Loan Document, to the extent such liability is unsecured, may be subject to the write-down and conversion powers of an EEA Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:

(a) the application of any Write-Down and Conversion Powers by an EEA Resolution Authority to any such liabilities arising hereunder which may be payable to it by any party hereto that is an EEA Financial Institution; and

(b) the effects of any Bail-in Action on any such liability, including, if applicable:

(i) a reduction in full or in part or cancellation of any such liability;

(ii) a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such EEA Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it, and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability under this Agreement or any other Loan Document; or

(iii) the variation of the terms of such liability in connection with the exercise of the write-down and conversion powers of any EEA Resolution Authority.

Section 9.26 Acknowledgement Regarding Any Supported QFCs. To the extent that the Loan Documents provide support, through a guarantee or otherwise, for Swap Agreements or any other agreement or instrument that is a QFC (such support “QFC Credit Support” and each such QFC a “Supported QFC”), the parties acknowledge and agree as follows with respect to the resolution power of the Federal Deposit Insurance Corporation under the Federal Deposit Insurance Act and Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act (together with the regulations promulgated thereunder, the “U.S. Special Resolution Regimes”) in respect of such Supported QFC and QFC Credit Support (with the provisions below applicable notwithstanding that the Loan Documents and any Supported QFC may in fact be stated to be governed by the laws of the State of New York and/or of the United States or any other state of the United States):

In the event a Covered Entity that is party to a Supported QFC (each, a “Covered Party”) becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer of such Supported QFC and the benefit of such QFC Credit Support (and any interest and obligation in or under such Supported QFC and such QFC Credit Support, and any rights in property securing such Supported QFC or such QFC Credit Support) from such Covered Party will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if the Supported QFC and such QFC Credit Support (and any such interest, obligation and rights in property) were governed by the laws of the United States or a state of the United States. In the event a Covered Party or a BHC Act Affiliate of a Covered Party becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under the Loan Documents that might otherwise apply to such supported QFC or any QFC Credit Support that may be exercised against

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such Covered Party are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if the Supported QFC and the Loan Documents were governed by the laws of the United States or a state of the United States. Without limitation of the foregoing, it is understood and agreed that rights and remedies of the parties with respect to a Defaulting Lender shall in no event affect the rights of any Covered Party with respect to a Supported QFC or any QFC Credit Support.

ARTICLE X

GUARANTEE

Section 10.01 The Guarantee. The Guarantors hereby, jointly and severally guarantee, as a primary obligor and not as a surety to each Secured Party and their respective successors and assigns, the prompt payment in full when due (whether at stated maturity, by required prepayment, declaration, demand, by acceleration or otherwise) of the principal of and interest (including any interest, fees, costs or charges that would accrue but for the provisions of the Title 11 of the United States Code or other applicable bankruptcy or insolvency legislation after any bankruptcy or insolvency petition under Title 11 of the United States Code, the BIA, the CCAA, the WURA or other applicable bankruptcy or insolvency legislation) on the Loans made by the Lenders to, and the promissory notes held by each Lender of, the Borrowers, all Secured Obligations of the Borrowers and the other Loan Parties under Permitted Swap Agreements and all other Secured Obligations from time to time owing to the Secured Parties by any Loan Party under any Loan Document or pursuant to any agreement as described in clause (c) of the definition of “Secured Obligations,” in each case strictly in accordance with the terms thereof (such obligations being herein collectively called the “Guaranteed Obligations”).The Guarantors hereby jointly and severally agree that if the Borrowers or other Guarantor(s) shall fail to pay in full when due (whether at stated maturity, by acceleration or otherwise) any of the Guaranteed Obligations, the Guarantors will promptly pay the same in cash, without any demand or notice whatsoever, and that in the case of any extension of time of payment or renewal of any of the Guaranteed Obligations, the same will be promptly paid in full when due (whether at extended maturity, by acceleration or otherwise) in accordance with the terms of such extension or renewal.

Section 10.02 Obligations Unconditional. The obligations of the Guarantors under Section 10.01 shall constitute a guaranty of payment and to the fullest extent permitted by applicable law, are absolute, irrevocable and unconditional, joint and several, irrespective of the value, genuineness, validity, regularity or enforceability of the Guaranteed Obligations of the Borrowers under this Agreement, the promissory notes, if any, or any other agreement or instrument referred to herein or therein, or any substitution, release or exchange of any other guarantee of or security for any of the Guaranteed Obligations, and, irrespective of any other circumstance whatsoever that might otherwise constitute a legal or equitable discharge or defense of a surety or Guarantor (except for payment in full). Without limiting the generality of the foregoing, it is agreed that the occurrence of any one or more of the following shall not alter or impair the liability of the Guarantors hereunder which shall remain absolute, irrevocable and unconditional under any and all circumstances as described above:

(i) at any time or from time to time, without notice to the Guarantors, the time for any performance of or compliance with any of the Guaranteed Obligations shall be extended, or such performance or compliance shall be waived;

(ii) any of the acts mentioned in any of the provisions of this Agreement or the promissory notes, if any, or any other agreement or instrument referred to herein or therein shall be done or omitted;

(iii) the maturity of any of the Guaranteed Obligations shall be accelerated, or any of the Guaranteed Obligations shall be amended in any respect, or any right under the Loan Documents or any other agreement or instrument referred to herein or therein shall be amended or waived in any respect or any other guarantee of any of the Guaranteed Obligations or any security therefor shall be released or exchanged in whole or in part or otherwise dealt with;

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(iv) any Lien or security interest granted to, or in favor of, L/C Issuer or any Lender or Agent as security for any of the Guaranteed Obligations shall fail to be perfected; or

(v) the release of any other Guarantor pursuant to Section 10.09.

The Guarantors hereby expressly waive diligence, presentment, demand of payment, protest and all notices whatsoever, and any requirement that any Secured Party exhaust any right, power or remedy or proceed against any Borrower under this Agreement or the promissory notes, if any, or any other agreement or instrument referred to herein or therein, or against any other person under any other guarantee of, or security for, any of the Guaranteed Obligations. The Guarantors waive any and all notice of the creation, renewal, extension, waiver, termination or accrual of any of the Guaranteed Obligations and notice of or proof of reliance by any Secured Party upon this Guarantee or acceptance of this Guarantee, and the Guaranteed Obligations, and any of them, shall conclusively be deemed to have been created, contracted or incurred in reliance upon this Guarantee, and all dealings between the Borrowers and the Secured Parties shall likewise be conclusively presumed to have been had or consummated in reliance upon this Guarantee. This Guarantee shall be construed as a continuing, absolute, irrevocable and unconditional guarantee of payment without regard to any right of offset with respect to the Guaranteed Obligations at any time or from time to time held by Secured Parties, and the obligations and liabilities of the Guarantors hereunder shall not be conditioned or contingent upon the pursuit by the Secured Parties or any other person at any time of any right or remedy against any Borrower or against any other person which may be or become liable in respect of all or any part of the Guaranteed Obligations or against any collateral security or guarantee therefor or right of offset with respect thereto. This Guarantee shall remain in full force and effect and be binding in accordance with and to the extent of its terms upon the Guarantors and the successors and assigns thereof, and shall inure to the benefit of the Secured Parties, and their respective successors and assigns, notwithstanding that from time to time during the term of this Agreement there may be no Guaranteed Obligations outstanding.

Section 10.03 Reinstatement. The obligations of the Guarantors under this Article X shall be automatically reinstated if and to the extent that for any reason any payment by or on behalf of the Borrowers or other Loan Party in respect of the applicable Guaranteed Obligations is rescinded or must be otherwise restored by any holder of any of the applicable Guaranteed Obligations, whether as a result of any proceedings in bankruptcy or reorganization or otherwise.

Section 10.04 Subrogation; Subordination. Each Guarantor hereby agrees that until the indefeasible payment and satisfaction in full in cash of all applicable Guaranteed Obligations and the expiration and termination of the Commitments of the Lenders under this Agreement it shall waive any claim and shall not exercise any right or remedy, direct or indirect, arising by reason of any performance by it of its guarantee in Section 10.01, whether by subrogation or otherwise, against any Borrower or any other Guarantor of any of the applicable Guaranteed Obligations or any security for any of the applicable Guaranteed Obligations. Any Indebtedness of any Loan Party permitted pursuant to clauses (g) or (h) of the definition of Permitted Debt shall be subordinated to such Loan Party’s Obligations in the manner set forth in the Intercompany Note evidencing such Indebtedness.

Section 10.05 Remedies. The Guarantors jointly and severally agree that, as between the Guarantors and the Lenders, the obligations of either Borrower under this Agreement, the promissory notes, if any, and any other agreement or instrument referred to herein or therein may be declared to be forthwith due and payable as provided in Article VII (and shall be deemed to have become automatically due and payable in the circumstances provided in said Article VII) for purposes of Section 10.01, notwithstanding any stay, injunction or other prohibition preventing such declaration (or such obligations from becoming automatically due and payable) as against the Borrowers and that, in the event of such declaration (or such obligations being deemed to have become automatically due and payable), such obligations (whether or not due and payable by the Borrowers) shall forthwith become due and payable by the applicable Guarantors for purposes of Section 10.01.

Section 10.06 Instrument for the Payment of Money. Each Guarantor hereby acknowledges that the guarantee in this Article X constitutes an instrument for the payment of money, and consents and agrees that any Lender or Agent, at its sole option, in the event of a dispute by such Guarantor in the payment of any moneys due hereunder, shall have the right to bring a motion-action under New York CPLR Section 3213.

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Section 10.07 Continuing Guarantee. The guarantee in this Article X is a continuing guarantee of payment, and shall apply to all applicable Guaranteed Obligations whenever arising.

Section 10.08 General Limitation on Guarantee Obligations. In any action or proceeding involving any state corporate limited partnership or limited liability company law, or any applicable state, federal or foreign bankruptcy, insolvency, reorganization or other law affecting the rights of creditors generally, if the obligations of any Guarantor under Section 10.01 would otherwise be held or determined to be void, voidable, invalid or unenforceable, or subordinated to the claims of any other creditors, on account of the amount of its liability under Section 10.01, then, notwithstanding any other provision to the contrary, the amount of such liability shall, without any further action by such Guarantor, any Loan Party or any other person, be automatically limited and reduced to the highest amount that is valid and enforceable and not subordinated to the claims of other creditors as determined in such action or proceeding. Each Guarantor that makes a payment under its Guarantee will be entitled upon payment in full of all guaranteed Obligations under this Agreement to a contribution from each other Guarantor in an amount equal to such other Guarantor’s pro rata portion of such payment based on the respective net assets of all of the Guarantors at the time of such payment determined in accordance with GAAP, each such claim or right being subordinated to the Obligations.

Section 10.09 Release of Guarantors. If, in compliance with the terms and provisions of the Loan Documents, all or substantially all of the Equity Interests or property of any Guarantor are sold or otherwise transferred (by merger, amalgamation or otherwise) (a “Transferred Guarantor”) to a person or persons, none of which is Borrowers or a Restricted Subsidiary, such Transferred Guarantor shall, upon the consummation of such sale or transfer, automatically be released from its obligations under this Agreement (including under Section 9.05 hereof) and its obligations to pledge and grant any Collateral owned by it pursuant to any Security Document and, in the case of a sale of all or substantially all of the Equity Interests of the Transferred Guarantor, the pledge of such Equity Interests to the Collateral Agent pursuant to the Security Documents shall automatically be released, and the Collateral Agent shall take such actions as are necessary or reasonably requested by the Canadian Borrower to evidence and confirm each release described in this Section 10.09 in accordance with the relevant provisions of the Security Documents and with Section 9.18 hereof.

Section 10.10 Brazilian Guarantors. To the extent concerning Brazilian Guarantors, each Guarantor hereby expressly waives the legal benefits provided for in articles 333 (sole paragraph), 366, 827, 828, 831, 834, 835, 837, 838 and 839 of Law 10,406/2002 (the “Brazilian Civil Code”) and articles 130 and 794 of Law 13,105/2015 (the “Brazilian Code of Civil Procedure”), until the payment and satisfaction in full of all applicable Guaranteed Obligations and the expiration and termination of the Commitments of the Lenders under this Agreement.

[Signature Pages Intentionally Omitted]

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ExhibitB

[Attached]

Exhibit****B-1

page 1

[FORM OF]

BORROWING REQUEST

JPMorgan Chase Bank, N.A.,

as the Administrative Agent

for the Lenders referred to below

JPMorgan Loan Services

500 Stanton Christiana Road, NCC5 Floor 01

Newark, DE 197130

Attention: Robert Madak

Tel: 302-634-1392

Fax: 302-634-1028

Email: Robert.madak@jpmorgan.com

For loan activity notices, a copy to: 14698287788@TLS.ldsprod.com

[Date]

Ladies and Gentlemen:

Reference is made to the Credit Agreement, dated as of March 28, 2012 (as amended by that certain Amendment No. 1, dated as of April 2, 2013, Amendment No. 2, dated as of November 17, 2016, Amendment No. 3, dated as of December 19, 2016, Amendment No. 4, dated as of February 1, 2017, Amendment No. 5, dated as of April 26, 2018, Amendment No. 6, dated as of December 6, 2019, Amendment No. 7, dated as of May 9, 2023, and as further amended, supplemented, waived or otherwise modified from time to time, the “Credit Agreement”), among TELESAT CANADA, a Canada corporation (the “Canadian Borrower”), TELESAT LLC, a Delaware limited liability company (the “U.S. Borrower” and, together with the Canadian Borrower, the “Borrowers”), the Guarantors party thereto, the Lenders party thereto and JPMORGAN CHASE BANK, N.A., as Administrative Agent (in such capacity, the “Administrative Agent”), Collateral Agent (in such capacity, the “Collateral Agent”), Swingline Lender and L/C Issuer. Terms defined in the Credit Agreement are used herein with the same meanings. This notice constitutes a Borrowing Request and the Canadian Borrower hereby requests Borrowings under the Credit Agreement, and in connection with such request, the Canadian Borrower specifies the following information with respect to such Borrowings requested hereby:

(A) Facility: ____________________

(B) Aggregate Amount of Borrowing: ___________________

| **Exhibit B-1** |

| --- | | page 2 |

(D) Type of Borrowing (ABR or Term Benchmark/BA Borrowing or Canadian Prime Rate Borrowing): ___________________

(E) Currency: ______________ __

(F) Interest/BA Contract Period (if a Term Benchmark/BA Borrowing): ________________

(G) Location and number of the applicable Borrower’s account to which proceeds of Borrowing are to be disbursed: ___________________

The Borrower named below hereby represents and warrants that the conditions specified in paragraphs (b) and (c) of Section 4.01 of the Credit Agreement are satisfied.

Very truly yours,
TELESAT CANADA
By:
	Name:
	Title:

Exhibit 8.1

SUBSIDIARIES OF TELESAT CORPORATION^1^

Subsidiary	State or Other Jurisdiction of<br><br>Incorporation or Organization
Telesat Canada	Canada
Telesat International Limited	England and Wales
Telesat Spectrum General Partnership	Ontario
Telesat (IOM) Holdings Limited	Isle of Man
Telesat LEO Holdings Inc.	Canada
Telesat Technology Corporation	Canada
Telesat Spectrum Holdings Corporation	Canada
Telesat Spectrum Corporation	Canada
Telesat LEO Inc.	Canada
1	Excludes certain subsidiaries which, considered in the aggregate<br>as a single subsidiary, do not constitute a significant subsidiary (as defined in Rule 1-02(w) of Regulation S-X) as of December 31,<br>2023.
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Exhibit 11.1

InsiderTrading Policy

Policy

Section 1 Purpose

As a publicly-traded company, Telesat Corporation (together with its subsidiaries, “Telesat” the “Company” or “we”) and its directors, officers, employees, and other persons in a special relationship with Telesat are subject to legal restrictions relating to the treatment of undisclosed material information. In particular, trading or recommending or encouraging others to trade while in possession of undisclosed material information, or informing others of undisclosed material information, may be a violation of securities, corporate and criminal laws (the “Applicable Laws”).

The policies, procedures and guidelines (collectively, the “policies”) set out in this Insider Trading Policy (the “Policy”) have been developed to protect the Company and those to whom this Policy applies by preventing improper trading, and the appearance of improper trading, in Telesat’s securities. Given the connection with the protection and dissemination of undisclosed material information, this Policy should be read in conjunction with and supplements the requirements set out in the Company’s Disclosure Policy.

It is essential that everyone to whom this Policy applies understands and complies with this Policy. If you are ever unsure of whether or not you are permitted to trade in the Company’s securities or the securities of another public company, contact the General Counsel before you act.

Certain terms used in this Policy have very specific meanings and are explained further in Appendix “A” to this Policy.

The Board has approved this Policy, which, together with the mandate of the Board, the charters for the committees of the Board, the position descriptions for the Board chair, lead director and committee chairs, the articles of Telesat, as amended and restated (the “Telesat Corporation Articles”) and the separate investor rights agreements dated November 23, 2020 entered into between Telesat and each of MHR Fund Management LLC (“MHR”) and Public Sector Pension Investment Board (“PSP”) (as may be amended from time to time, the “Investor Rights Agreements”) provide the general framework for the governance of the Company. In the event of any conflict between this policy and the Telesat Corporation Articles or the Investor Rights Agreements, or any of the rights, privileges, arrangements, or powers set forth therein, the Telesat Corporation Articles and the Investor Rights Agreements shall prevail and this policy shall not and shall be interpreted not to, directly or indirectly interfere with, limit or restrict or otherwise disrupt, any of such rights, privileges, arrangements or powers. The Board intends that policy will

Adopted: November 19, 2021

Last Amended: November 2, 2023

InsiderTrading Policy

continue to evolve to address all applicable regulatory and stock exchange requirements relating to corporate governance and will be modified and updated as circumstances warrant.

Section 2 Scope

This Policy applies to all members of the board of directors, officers and employees of the Company and its subsidiaries worldwide and any consultants, contractors and agents of the Company and its subsidiaries worldwide who receive or have access to undisclosed material information. In addition, it should be noted that similar restrictions apply under Applicable Laws to all persons or companies in a “special relationship” with the Company as described in Appendix “A” of this Policy.

The Company securities covered by this Policy include the Company’s common shares, securities convertible or exchangeable into shares or other securities of the Company, debt instruments, puts, calls, options, warrants and any other rights or obligations to purchase or sell securities of the Company. It also applies to derivative securities, such as exchange-traded put or call options or swaps relating to the Company’s securities, whether or not issued by the Company, including any security, the market price of which varies materially with the market price of the securities of the Company. Any reference in this Policy to Company “shares”, “securities” or other similar terms when used in reference to the Company’s shares has the foregoing meaning.

It is important to understand that this Policy applies to all shares that directors, officers, employees, consultants, contractors or agents of the Company or its subsidiaries (“you”) beneficially own and/or over which you have direct or indirect control or direction, which includes securities owned by family or household members where you direct or influence their investment decisions or other corporations, partnerships or trusts under your influence or control.

While this Policy does not directly extend to your family members or household members, you should be particularly sensitive to ensuring that your spouse, partner and other family members and household members do not, intentionally or unintentionally, gain access to undisclosed material information about the Company. The restrictions under Applicable Laws, as well as the potential consequences for violation, may apply to your spouse, partner or other family members or household members if they gain access to undisclosed material information from you.

Section 3 Individual Responsibility

Persons subject to this Policy are individually responsible for complying with this Policy and ensuring the compliance of any family member, household member or entity whose transactions are subject to this Policy. Although the restrictions

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InsiderTrading Policy

contained in this Policy do not directly apply to family members (unless you control or direct investments in Company securities on their behalf) it is nevertheless important that your family members understand the importance of confidentiality as it relates to material nonpublic information. In all cases, the responsibility for determining whether an individual is in possession of material nonpublic information rests with that individual, and any action on the part of the Company or any other employee pursuant to this Policy (or otherwise) does not insulate an individual from liability under applicable securities laws.

Section 4 What is ‘Material Information’?

“Materialinformation” means either a “material fact” or a “material change”.

A “material fact” means: (i) when used in relation to the Company’s shares issued or proposed to be issued, a fact that would reasonably be expected to have a significant effect on the market price or value of the Company’s shares, or (ii) information where there is a substantial likelihood that a reasonable investor would consider the information important in making an investment decision regarding whether to trade in or hold a security.

A “material change” means: (i) a change in the business, operations or capital of the Company that would reasonably be expected to have a significant effect on the market price or value of the Company’s shares; or (ii) a decision to implement such a change made by: (A) the directors of the Company; or (B) senior management of the Company who believe that confirmation of the decision by the directors is probable.

Information may be material even if it relates to future or contingent events and even if it is significant only when considered in combination with publicly available information. Material information can be positive or negative.

Due to the difficulties in defining all categories of material information, the ultimate determination of materiality by enforcement authorities will be based on an assessment of all of the facts and circumstances with the benefit of hindsight. Information that is material at one point in time may cease to be material at another point in time, and vice versa. It is not possible to define all categories of material information; however, some examples of information (not intended to be an exhaustive list or a determination that it actually constitutes material information, or a substitute for the exercise of judgment in making materiality determinations) that could be considered material in particular situations include:

●	operating<br>and financial results;
●	business<br> plans, strategies, or negotiations;
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InsiderTrading Policy

●	proposed<br> mergers, acquisitions or joint ventures involving the Company or divestitures of significant<br> assets or a subsidiary by the Company;
●	changes<br> in share ownership that may affect control of the Company;
---	---
●	Board<br> of Directors or senior management changes;
---	---
●	public<br> or private sales of the Company’s securities;
---	---
●	proposed<br> or pending financings;
---	---
●	events<br> of default under financing or other agreements;
---	---
●	financial<br> or liquidity problems, bankruptcy, corporate restructuring, or receivership;
---	---
●	material<br> transactions involving directors, officers or principal shareholders of the Company;
---	---
●	labour<br> disputes or disputes with important suppliers;
---	---
●	significant<br> write-downs of assets or additions to reserves for bad debts or contingent liabilities;
---	---
●	cyber<br> intrusions or other data breaches;
---	---
●	changes<br> in the Company’s auditors;
---	---
●	pending<br> or threatened litigation outside of the ordinary course of business;
---	---
●	decisions<br> or recommendations regarding dividend payments or policies, or other modifications to the<br> rights of the Company’s security holders;
---	---
●	significant<br> new products or significant developments regarding customers or business partners;
---	---
●	changes<br> in the Company’s credit ratings; and
---	---
●	changes<br> in capital or corporate structure.
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InsiderTrading Policy

Section 5 What is ‘Undisclosed Material Information’?

Material information that has not yet been generally disclosed to the public is referred to as “undisclosed material information”. As a general rule, in order for material information to be considered “generally disclosed” to the public, it must be published and widely disseminated, including but not limited to, by way of a press release (making it generally available to investors), and sufficient time must have elapsed in order for the market to digest and react to the information.

Generally, this means two (2) full trading days (including the date of publication if during trading hours), unless otherwise advised by the General Counsel that the sufficient period is longer or shorter. The term “trading day” means a day on which the stock exchange(s) on which the Company’s securities are traded (currently the Toronto Stock Exchange and NASDAQ) are open for trading. You may not attempt to “beat the market” by trading simultaneously with, or shortly after, the official release of material information.

If securities transactions ever become the subject of scrutiny, they are likely to be viewed after-the-fact with the benefit of hindsight. As a result, before engaging in any transaction you should carefully consider how the transaction may be construed in the bright light of hindsight. If you have any questions or uncertainties about this Policy or a proposed transaction, please ask the General Counsel.

Section 6 Insider Trading and Tipping Restrictions

*(a)*Persons in a “special relationship” with the Company

You may come into possession of material information about the Company or other companies in the normal course of your work (such as news about financial results prior to public disclosure, financings, major projects, significant management changes, etc.). Under Applicable Laws, significant shareholders, directors, officers, employees, contractors and consultants of the Company, among others, may be considered to be in a “special relationship” with the Company and, as a result, caught by the prohibitions against insider trading, tipping and recommending described below. The concept of a special relationship with a public company is defined very broadly and extends to any person or company who falls within one of the categories summarized in Appendix “A”. Importantly, it also captures a potentially infinite chain of persons who receive undisclosed material information about the Company from any person who is in a special relationship with the Company.

*(b)*No trading on undisclosed material information

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InsiderTrading Policy

It is illegal and strictly prohibited by this Policy to directly or indirectly engage in any transaction involving a purchase or sale of the Company’s shares at any time when you have knowledge of undisclosed material information. To do so would be “insider trading”.

You may, from time to time, have to forego a proposed transaction in the Company’s securities even if you planned to complete the transaction before learning of the undisclosed material information if completing such transaction would violate the terms of this Policy or Applicable laws. If you have questions about whether material information is public or has been “generally disclosed”, or has ceased to be material, you may contact the General Counsel or any other person otherwise designated under the Disclosure Policy.

*(c)*No “tipping” or “recommending”

It is strictly prohibited by this Policy to disclose, other than in the necessary course of business or as permitted by the Disclosure Policy, undisclosed material information relating to the Company to any other person (such as, but not limited to, family members, neighbors, friends, acquaintances, investment professionals, financial planners, family companies or family trusts), or to make recommendations or encourage, other than in the necessary course of business, the purchase or sale of the Company’s shares on the basis of undisclosed material information. To do so would be “tipping”.

The question of whether a particular disclosure is being made in the “necessary course of business” is a mixed question of law and fact that must be determined on a case-by-case basis. While communications between employees, officers and board members, legal counsel, auditors and other professional advisors is generally acceptable, disclosure of information to analysts, institutional investors, other market professionals and members of the press and other media may be a form of “tipping” and will not be considered to be in the necessary course of business. Generally, you should refrain from making such disclosure unless you have been specifically advised by the General Counsel or Investor Relations Department that it is permitted.

Applicable Laws in the U.S. prohibits directors and others who owe a fiduciary duty to the Company from conveying material undisclosed information to a third party if such person knows or has reason to believe that the third party will misuse such information by trading in securities or passing such information to other third parties who will trade on such information, in each case, in violation of Applicable Laws.

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InsiderTrading Policy

Section 7 Restrictions on Short Selling, Hedging and Other Speculative Trading

*(a)*Short Selling Transactions

Investing in the Company’s shares provides an opportunity to share in the Company’s future growth and, accordingly, directors, officers and employees are encouraged to make investments in the Company for the long-term. As a general guideline, directors, officers and employees should acquire Telesat’s securities only if such individuals intend to hold the securities for a period of at least six months, and always with due observance of the terms of this Policy.

Directors, officers and employees must refrain from active or speculative trading involving the Company’s shares based on short-term fluctuations in the price of the shares or other market conditions. This includes, but is not limited to, short sales, trading in puts, calls or options or similar rights or obligations to buy or sell Telesat’s securities or derivative securities relating to Telesat’s securities, and the purchase of Company securities with the intention of quickly reselling them. In addition, directors, officers and employees are not permitted to buy Telesat securities on margin. Directors, officers and employees may, of course, exercise stock options granted to them by Telesat and, subject to the restrictions discussed in this Policy, sell shares acquired through the exercise of those options.

A put is a right to sell a security at a specific price before or at a set date, and a call is a right to buy a security at a specific price before or at a set date. Transactions in options may also focus the attention of our directors, officers and employees on short-term performance at the expense of the Telesat’s long-term objectives. Accordingly, directors, officers and employees may not engage in a put, call or other derivative security transaction relating to Telesat’s securities on an exchange or in any other organized market.

*(b)*Hedging Transactions

Directors, officers and employees are also prohibited from purchasing or using, directly or indirectly, financial instruments (such as prepaid variable forward contracts, equity swaps or collars) designed to hedge or offset a decrease in the market value of the Company’s securities.

Certain forms of hedging or monetization transactions, including zero-cost collars, equity swaps, exchange funds and forward sale contracts, allow a securityholder to lock in much of the value of their securities holdings, often in exchange for all or part of the potential for upside appreciation in the securities. These transactions allow the securityholder to continue to own the

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covered securities, but without the full risks and rewards of ownership. Because participating in these transactions may cause an individual to no longer have the same objectives as Telesat’s other securityholders, directors, officers and employees may not engage in such transactions.

*(c)*Margin Accounts and Pledges

Securities held in margin accounts for collateral as a margined loan may be sold by the broker without the customer’s consent if the customer fails to meet a margin call. Similarly, securities pledged (or hypothecated) as collateral for a loan may be sold in foreclosure if the borrower defaults on the loan. A margin sale or foreclosure sale that occurs at a time when the pledger is aware of undisclosed material information or otherwise is not permitted to trade in the Company’s securities would fall under the restrictions in this Policy on trading during such times. Therefore, directors, officers and employees may not hold Telesat’s securities in a margin account or pledge the Company’s securities as collateral for a loan.

The terms of this Section 7 shall not apply to any affiliates or other related persons of any director, officer or employee of the Company except as otherwise required by Applicable Laws.

Section 8 Trading Blackouts

The period beginning at the end of each quarter (or fiscal year) and ending two (2) trading days following the date of public disclosure of the financial results for that quarter (or fiscal year) (a “Blackout Period”) is particularly sensitive, as directors, and certain officers and other employees may often possess undisclosed material information about the expected financial results for the quarter and year end.

Accordingly, to ensure compliance with this Policy and Applicable Laws, all Restricted Persons must refrain from any trading activities involving the Company’s shares during the Blackout Periods, confirmed and communicated by the General Counsel; provided that in respect of Restricted Persons who are non-executive directors, the blackout period shall begin instead at market close on the date that is fifteen (15) calendar days prior to the scheduled date of public disclosure of the financial results for that quarter (or fiscal year), and all references in this Policy to “Blackout Period” in respect of such persons shall mean such shorter period.

The Company may from time to time impose additional non-scheduled Blackout Periods on account of the existence of or potential for undisclosed material information. In such event, Restricted Persons will be advised of the start and end of the non-scheduled Blackout Period, during which time they are prohibited from trading in the Company’s shares, as well as from disclosing to others the facts

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giving rise to or the existence of a non-scheduled Blackout Period. The imposition of a special Blackout Period is itself confidential information, and the fact that it has been imposed shall not be disclosed to others.

Even in the absence of a Blackout Period, any person possessing undisclosed material information about the Company should not engage in any transactions in the Company’s shares until after two (2) trading days has elapsed from the public disclosure of such information.

Equity-based awards under the Company’s long-term compensation plans may not be exercised while a Blackout Period is in effect. In the event that equity-based awards expire during a Blackout Period, such expiry date will be extended as provided in the Company’s Long-Term Incentive Plan, or such other plan(s) governing securities compensation matters, as applicable.

Section 9 Pre-clearance of Trades

For the purposes of Section 8 and Section 9, “Restricted Persons” include all “reporting insiders” (as discussed below) and all other officers or employees who are specifically designated as Restricted Persons for the purposes of this Policy from time to time (as noted below).

Before initiating any trade in the Company’s shares or gifting any Company shares, any Restricted Person must obtain pre-clearance from the General Counsel, or in the case of the General Counsel, the Chief Financial Officer, whether or not a Blackout Period is in effect. For greater certainty, Restricted Persons must obtain pre-clearance before the exercise of any equity-based awards and/or subsequent trades in underlying Telesat shares. Each proposed transaction will be evaluated to determine if it raises potential insider trading or other concerns under Applicable Laws.

Clearance of a transaction is generally only valid for a five (5) day period or such other time period as expressly provided for in the clearance, unless, in all cases, earlier revoked. If the transaction order is not completed within the clearance period, approval of the proposed transaction must be re-requested. If clearance is denied, the fact of such denial must be kept confidential by the person requesting the approval. The General Counsel, or the Chief Financial Officer as applicable, is under no obligation to approve a transaction submitted for pre-clearance.

Section 10 Insider Reporting Requirements

Under Applicable Laws, certain “insiders” of the Company who are deemed “reporting insiders” are required to comply with insider reporting requirements and to report their activities in respect of the Company’s shares. Reporting insiders include all directors of the Company, as well as certain executive officers and other

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employees who have routine access to undisclosed material information and the ability, directly or indirectly, to exercise influence over the business, operations, affairs, capital or development of the Company. See Appendix “B” to this Policy for the definition of reporting insider. Designation as a reporting insider may change over time and the Company will advise you if you are considered a reporting insider.

Reporting insiders are required to file insider trading reports in accordance with National Instrument 55-104 – Insider Reporting Requirementsand Exemptions. Reporting insiders are required to file an initial insider trading report within ten (10) calendar days of first becoming a reporting insider, disclosing any direct or indirect beneficial ownership of or control or direction over a share of the Company, and interest in, or right or obligation associated with, a related financial instrument involving a share of the Company. Reporting insiders are also required to file an insider trading report within five (5) days of the date of any change in such direct or indirect beneficial ownership or control or direction, or such interest, right or obligation. Insider reports are filed with securities regulators electronically through the System for Electronic Disclosure by Insiders (SEDI) at www.sedi.ca.

Reporting insiders (not Telesat) are personally and legally responsible for ensuring the accurate and timely disclosure of their trading activities. However, Telesat’s Legal Department (the “Legal Department”) is available to assist you in the preparation and filing of insider trading reports and, where such assistance is requested, reporting insiders must provide the Legal Department with all required information to allow for timely submission of reports. Reporting insiders who file their own reports are asked to provide a copy to the Legal Department so that the Company’s records may be updated.

Consequences of contravening insider reporting requirements include the imposition of late filing fees, being identified as a late filer on public databases maintained by securities regulators, the issuance of cease trade orders or, in appropriate circumstances, enforcement proceedings.

Section 11 Certain Exceptions (when applicable)

Employee Stock Purchase Plan: This Policy does not apply to purchases of Telesat shares resulting from your periodic contribution of money to the employee share purchase plan pursuant to the election made by you at the time of enrollment. This Policy does apply, however, to (1) an election to participate in the plan for any enrollment period, (2) sales of Telesat shares purchased pursuant to the plan, and (3) an election to increase or decrease the amount of automatic periodic contributions by payroll deduction to the plan.

Automatic Securities Purchase or Disposition Plan or similar arrangement: This Policy does not apply to a plan or agreement whereby your Telesat securities are purchased or sold on an automatic basis and in accordance with a pre-determined schedule

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which includes clear trading parameters, through your dealer or plan administrator. This includes trading plans in accordance with Rule 10b5-1(c) of the U.S. Exchange Act of 1934 and otherwise pursuant to Telesat’s procedure for adopting such a trading plan. All such trading plans or agreements, or any changes thereto, must be pre-cleared with the General Counsel.

Restricted Share, Restricted Share Unit Awards and Deferred Share Unit Awards: This Policy does not apply to the vesting and settlement of restricted shares, deferred share units and restricted share units, or the withholding or sale of shares back to Telesat to satisfy tax withholding obligations upon the vesting of any restricted shares, deferred share units or restricted share units. The Policy does apply, however, to any market sale of shares after vesting.

Dividend Reinvestment Plan: This Policy does not apply to purchases of Telesat shares under Telesat’s dividend reinvestment plan, if any, resulting from your reinvestment of dividends paid on Telesat shares. This Policy does apply, however, to voluntary purchases of Telesat shares resulting from additional contributions you choose to make to the dividend reinvestment plan, if any, and to an election to participate in the plan or to increase their level of participation in the plan. This Policy also applies to your sale of any Telesat shares purchased pursuant to the plan.

Bonafide gifts: This Policy does not apply to bona fide gifts of Telesat securities. Because circumstances under which a gift may be considered bona fide vary based on context, you are required to consult the General Counsel when contemplating a gift.

Section 12 Trading in Securities of Other Companies

This Policy is not restricted to information affecting the Company and its shares. You may obtain material information about other companies in the course of your work for the Company. As such, Applicable Law may also apply to undisclosed material information about other companies or entities with which we do business, including but not limited to joint venture partners, service providers, shareholders, security holders, customers, vendors, contractors, partners, vendors and suppliers of the Company. This also includes a potential take-over bid, merger or acquisition candidates (collectively, “business counterparties”), when that information is obtained in the course of employment with, or providing services to, or on behalf of, the Company.

Criminal and civil penalties and termination of your relationship with the Company may result from trading in the securities of, or tipping in relation to, any business counterparty when in possession of undisclosed material information about that business counterparty. Undisclosed material information about the Company’s business counterparties should be treated with the same care as information

Page **11** of **15**

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related directly to the Company.

Section 13 Confidentiality

You must maintain the confidentiality of the Company’s non-public information. In the event you receive any inquiry or request for information (particularly financial results and/or projections, and including any inquiry or request to affirm or deny information about Telesat), from any person or entity outside the Company, such as a stock analyst, and it is not part of your regular corporate duties to respond to such inquiry or request, you should not respond to such inquiry and the inquiry may be referred to the Investor Relations Department, who will determine whether such inquiry should also be forwarded to the Disclosure Committee. See the Company’s Disclosure Policy for further guidance on confidentiality and related restrictions.

Section 14 Policy Awareness and Consequences for Violation

A final copy of this Policy will be reviewed and acknowledged annually. Any amendments made to it from time to time will be made available either directly or by posting a revised policy to all employees for review and signoff.

Insider trading or tipping are serious offences and the consequences can be severe. Those who violate this Policy will be subject to disciplinary action by the Company, including possible termination of their relationship with the Company. This is in addition to facing significant fines and penalties and/or imprisonment. Under Applicable Laws in Canada, penalties for violations of insider trading laws currently include fines of up to $5 million or triple any profit made or loss avoided, whichever is greater, as well as imprisonment for up to 5 years. Under Applicable Laws in the U.S., individuals who engage in illegal insider trading or tipping can be liable for substantial criminal and civil penalties, including (i) imprisonment for up to 20 years; (ii) criminal fines of up to $5 million; and (iii) civil penalties of up to three times the profits gained or losses avoided. You should carefully consider how your trading activities may be construed by enforcement authorities who have the benefit of hindsight. Moreover, every director and officer, as representatives of Telesat, may cause serious reputational harm to the Company if they engage in an improper transaction in trading the Company’s securities.

Insiders may also be liable for improper transactions by any person to whom they have disclosed undisclosed material information regarding the Company or to whom they have made recommendations or expressed opinions based on such information (commonly referred to as a “tippee”). Large penalties have been imposed even when the disclosing person did not profit from the trading.

Potential violation of this Policy may be reported through the Audit Committee or the Company’s third party service provider in accordance with the Company’s

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Whistleblower Policy and will be duly treated and investigated by the Audit Committee. Such committee will evaluate and address proper disciplinary actions.

Section 15 Post-Termination Transactions

The restrictions set out in this Policy may continue to apply even after termination of employment or service with Telesat under Applicable Law. If you are in possession of undisclosed material information when your employment or service terminates, you may not trade in the Company’s securities (or another company’s securities, as described in this Policy) until such information has become public or is no longer material.

Section 16 Review of the Policy and Waivers

The Company will review this Policy periodically to ensure it continues to comply with Applicable Laws and good corporate governance practices. The review will be undertaken by the General Counsel with assistance from outside counsel.

The Board may, from time to time, permit departures from the terms of this Policy, either prospectively or retrospectively. This Policy is not intended to give rise to civil liability on the part of the Company or its directors or officers to shareholders, security holders, customers, suppliers, competitors, employees or other persons, or to any other liability whatsoever on their part.

Section 17 Questions

If you have questions about general insider trading matters or your responsibilities under this Policy, or your plan to trade in Telesat securities but are unsure as to whether the transaction might be in conflict with Applicable Laws and/or this Policy, please contact the General Counsel.

Section 18 RELATED DOCUMENTS

Disclosure Policy

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Appendix“A”

PERSONSIN A SPECIAL RELATIONSHIP WITH TELESAT

Under Applicable Laws, persons in a “special relationship” with Telesat include:

(a)	all<br> directors, officers and employees of Telesat;
(b)	all<br> directors, officers and employees of any subsidiary of Telesat;
---	---
(c)	any<br> person or company who beneficially owns, controls or directs more than 10% of the shares<br> of Telesat;
---	---
(d)	every<br> director or officer of a company referred to in (c) and every director, officer or employee<br> of any company that holds more than 50% of the shares of Telesat;
---	---
(e)	a<br> person or company that is: (i) considering or evaluating whether or proposing to make a takeover<br> bid for the shares of Telesat; or (ii) considering or evaluating whether or proposing to<br> become a party to a reorganization, amalgamation, merger, arrangement, or other business<br> combination with Telesat; or (iii) considering or evaluating whether or proposing to acquire<br> a substantial portion of Telesat property; (each of (i), (ii), or (iii) is herein referred<br> to as a “Merger Partner”), and every director, officer or employee of<br> a Merger Partner and any person who beneficially owns, controls or directs more than 10%<br> of the voting shares of the Merger Partner;
---	---
(f)	a<br> person or company (for example, consultants, advisers, contractors) that is engaging in or<br> considering or evaluating whether or proposing to engage in any business or professional<br> activity with or on behalf of Telesat or a Merger Partner, and every director, officer or<br> employee thereof;
---	---
(g)	a<br> person or company that learns of undisclosed material information while the person or company<br> was any of the persons or companies described in (a) through (f) above; and
---	---
(h)	a<br> person or company that learns of undisclosed material information with respect to Telesat<br> (a “tippee”) from any other person or company in a special relationship<br> with Telesat (a “tipper”) where the tippee knows or ought reasonably to<br> have known that the tipper is in a special relationship with Telesat. This includes a “tippee”<br> who is tipped by a previous “tippee”. The significance of clause (h) is that<br> it creates an indefinite chain so that any person who either trades on or discloses undisclosed<br> material information acquired directly or indirectly from someone “on the inside”<br> will be subject to the criminal and/or civil liabilities described in this Insider Trading<br> Policy.
---	---

Page **14** of **15**

Appendix“B”

REPORTINGINSIDER DEFINITION

Certain persons are designated or determined to be insiders for reporting purposes under Canadian National Instrument 55-104. These include:

(a)	the<br> CEO, CFO or COO of a reporting issuer, of a significant shareholder of a reporting issuer<br> or of a major subsidiary of a reporting issuer;
(b)	a<br> director of a reporting issuer, of a significant shareholder or of a major subsidiary of<br> a reporting issuer;
---	---
(c)	a<br> person or company responsible for a principal business unit, division or function of a reporting<br> issuer;
---	---
(d)	a<br> significant shareholder of a reporting issuer;
---	---
(e)	a<br> significant shareholder based on post-conversion beneficial ownership of a reporting issuer’s<br> securities and the CEO, CFO, COO and every director of the significant shareholder based<br> on post-conversion beneficial ownership;
---	---
(f)	a<br> management company that provides significant management or administrative services to a reporting<br> issuer or to major subsidiary of it, every director of the management company, every CEO,<br> CFO and COO of the management company, and every significant shareholder of the management<br> company;
---	---
(g)	an<br> individual performing functions similar to the functions performed by any of the insiders<br> described in paragraphs (a) to (f);
---	---
(h)	the<br> listed company itself, if it has purchased, redeemed or otherwise acquired a security of<br> its own issue, for so long as it continues to hold that security; or
---	---
(i)	any<br> other insider that:
---	---

(x) in the ordinary course receives or has access to information as to material facts or material changes concerning a reporting issuer before the material facts or material changes are generally disclosed; and

(y) directly or indirectly exercises, or has the ability to exercise, significant power or influence over the business, operations, capital or development of a reporting issuer.

Page 15 of 15

Exhibit 12.1

CERTIFICATION

I, Daniel S. Goldberg, certify that:

1.	I have reviewed this annual report on Form 20-F of Telesat Corporation;
2.	Based on my knowledge, this report does not contain any untrue<br>statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under<br>which such statements were made, not misleading with respect to the period covered by this report;
---	---
3.	Based on my knowledge, the financial statements, and other financial<br>information included in this report, fairly present in all material respects the financial condition, results of operations and cash<br>flows of the company as of, and for, the periods presented in this report;
---	---
4.	The company’s other certifying officer(s) and I are responsible<br>for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal<br>control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have:
---	---
(a)	designed such disclosure controls and procedures, or caused<br>such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company,<br>including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which<br>this report is being prepared;
---	---
(b)	designed such internal control over financial reporting,<br>or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding<br>the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally<br>accepted accounting principles;
---	---
(c)	evaluated the effectiveness of the company’s disclosure<br>controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures,<br>as of the end of the period covered by this report based on such evaluation; and
---	---
(d)	disclosed in this report any change in the company’s<br>internal control over financial reporting that occurred during the period covered by the annual report that has materially affected,<br>or is reasonably likely to materially affect, the company’s internal control over financial reporting; and
---	---
5.	The company’s other certifying officer(s) and I have disclosed,<br>based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee<br>of the company’s board of directors (or persons performing the equivalent functions):
---	---
(a)	All significant deficiencies and material weaknesses in the<br>design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s<br>ability to record, process, summarize and report financial information; and
---	---
(b)	Any fraud, whether or not material, that involves management<br>or other employees who have a significant role in the company’s internal control over financial reporting.
---	---

Date: March 28, 2024

/s/ Daniel S. Goldberg
Daniel S. Goldberg
President and Chief Executive Officer

Exhibit 12.2

CERTIFICATION

I, Andrew Browne, certify that:

1.	I have reviewed this annual report on Form 20-F of Telesat Corporation;
2.	Based on my knowledge, this report does not contain any untrue<br>statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under<br>which such statements were made, not misleading with respect to the period covered by this report;
---	---
3.	Based on my knowledge, the financial statements, and other financial<br>information included in this report, fairly present in all material respects the financial condition, results of operations and cash<br>flows of the company as of, and for, the periods presented in this report;
---	---
4.	The company’s other certifying officer(s) and I are responsible<br>for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal<br>control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have:
---	---
(a)	designed such disclosure controls and procedures, or caused<br>such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company,<br>including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which<br>this report is being prepared;
---	---
(b)	designed such internal control over financial reporting,<br>or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding<br>the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally<br>accepted accounting principles;
---	---
(c)	evaluated the effectiveness of the company’s disclosure<br>controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures,<br>as of the end of the period covered by this report based on such evaluation; and
---	---
(d)	disclosed in this report any change in the company’s<br>internal control over financial reporting that occurred during the period covered by the annual report that has materially affected,<br>or is reasonably likely to materially affect, the company’s internal control over financial reporting; and
---	---
5.	The company’s other certifying officer(s) and I have disclosed,<br>based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee<br>of the company’s board of directors (or persons performing the equivalent functions):
---	---
(a)	All significant deficiencies and material weaknesses in the<br>design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s<br>ability to record, process, summarize and report financial information; and
---	---
(b)	Any fraud, whether or not material, that involves management<br>or other employees who have a significant role in the company’s internal control over financial reporting.
---	---

Date: March 28, 2024

/s/ Andrew Browne
Andrew Browne
Chief Financial Officer

Exhibit 13.1

CERTIFICATION PURSUANT TO18 U.S.C. SECTION 1350,AS ADOPTED PURSUANT TOSECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Telesat Corporation (the “Company”) on Form 20-F for the fiscal year ended December 31, 2023 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Daniel S. Goldberg, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: March 28, 2024

/s/ Daniel S. Goldberg
Name:	Daniel S. Goldberg
Title:	President and Chief Executive Officer

Exhibit 13.2

CERTIFICATION PURSUANT TO18 U.S.C. SECTION 1350,AS ADOPTED PURSUANT TOSECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Telesat Corporation (the “Company”) on Form 20-F for the fiscal year ended December 31, 2023 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Andrew Browne, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: March 28, 2024

/s/ Andrew Browne
Name:	Andrew Browne
Title:	Chief Financial Officer

Exhibit 15.1

Consent of Independent Registered Public Accounting Firm

We consent to the incorporation by reference in Registration Statement No. 333-261257 on Form S-8 of our reports dated March 27, 2024 relating to the financial statements of Telesat Corporation (the “Company”) and the effectiveness of the Company’s internal control over financial reporting appearing in this Annual Report on Form 20-F for the year ended December 31, 2023.

/s/ Deloitte LLP

Chartered Professional Accountants

Licensed Public Accountants

Toronto, Canada

March 27, 2024

Exhibit 97.1

TELESATCORPORATION

COMPENSATIONRECOVERY POLICY

(Adopted on November 30, 2023

and effective as of October 2, 2023)

1.	Purpose

Telesat Corporation (collectively with its subsidiaries, the “Company”) is committed to promoting high standards of honest and ethical business conduct and compliance with applicable laws, rules and regulations. As part of this commitment, the Company has adopted this Compensation Recovery Policy (this “Policy”). This Policy is designed to comply with Section 10D of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and explains when the Company will be required to seek recovery of Incentive Compensation awarded or paid to a Covered Person. Please refer to Exhibit A attached hereto (the “Definitions Exhibit”) for the definitions of capitalized terms used throughout this Policy.

2.	Miscalculation of Financial Reporting Measure Results

In the event of a Restatement, the Company will seek to recover, reasonably promptly, all Recoverable Incentive Compensation from a Covered Person. Such recovery will be made without regard to any individual knowledge or responsibility related to the Restatement. Notwithstanding the foregoing, if the Company is required to undertake a Restatement, the Company will not be required to recover the Recoverable Incentive Compensation if the Human Resources & Compensation Committee determines it Impracticable to do so, after exercising a normal due process review of all the relevant facts and circumstances.

If such Recoverable Incentive Compensation was not awarded or paid on a formulaic basis, the Company will seek to recover the amount that the Human Resources & Compensation Committee determines in good faith should be recouped.

3.	Other Actions

The Human Resources & Compensation Committee may, subject to applicable law, seek recovery in the manner it chooses, including by seeking reimbursement from the Covered Person of all or part of the compensation awarded or paid, by electing to withhold unpaid compensation, by set-off, or by rescinding or canceling unvested stock.

In the reasonable exercise of its business judgment under this Policy, the Human Resources & Compensation Committee may in its sole discretion determine whether and to what extent additional action is appropriate to address the circumstances surrounding a Restatement to minimize the likelihood of any recurrence and to impose such other discipline as it deems appropriate.

4.	No Indemnification or Reimbursement

Notwithstanding the terms of any other policy, program, agreement or arrangement, in no event will the Company or any of its affiliates indemnify or reimburse a Covered Person for any loss under this Policy and in no event will the Company or any of its affiliates pay premiums on any insurance policy that would cover a Covered Person’s potential obligations with respect to Recoverable Incentive Compensation under this Policy.

5.	Administration of Policy

The Human Resources & Compensation Committee will have full authority to administer this Policy. The Human Resources & Compensation Committee will, subject to the provisions of this Policy and Rule 10D-

1 of the Exchange Act, and the Company’s applicable exchange listing standards, make such determinations and interpretations and take such actions in connection with this Policy as it deems necessary, appropriate or advisable. All determinations and interpretations made by the Human Resources & Compensation Committee will be final, binding and conclusive.

6.	Other Claims and Rights

The remedies under this Policy are in addition to, and not in lieu of, any legal and equitable claims the Company or any of its affiliates may have or any actions that may be imposed by law enforcement agencies, regulators, administrative bodies, or other authorities. Further, the exercise by the Human Resources & Compensation Committee of any rights pursuant to this Policy will not impact any other rights that the Company or any of its affiliates may have with respect to any Covered Person subject to this Policy.

7.	Acknowledgement by Covered Persons; Condition to Eligibility for Incentive Compensation

The Company will provide notice and seek acknowledgement of this Policy from each Covered Person, provided that the failure to provide such notice or obtain such acknowledgement will have no impact on the applicability or enforceability of this Policy. After the Effective Date, the Company must be in receipt of a Covered Person’s acknowledgement as a condition to such Covered Person’s eligibility to receive further Incentive Compensation. All Incentive Compensation subject to this Policy will not be earned, even if already paid, until the Policy ceases to apply to such Incentive Compensation and any other vesting conditions applicable to such Incentive Compensation are satisfied.

8.	Amendment; Termination

The Board or the Human Resources & Compensation Committee may amend or terminate this Policy at any time.

9.	Effectiveness

Except as otherwise determined in writing by the Human Resources & Compensation Committee, this Policy will apply to any Incentive Compensation that is Received by a Covered Person on or after the Effective Date. Further, as of the Effective Date, this Policy amends and supersedes in their entirety any prior recovery of incentive compensation policy and any recoupment provisions which appear in a Covered Person’s equity award agreements or otherwise (the “Prior Policies”). Notwithstanding the foregoing, the Prior Policies shall remain in full force and effect as to any compensation that, without the existence, and satisfaction, of conditions as set forth in the Prior Policies, may otherwise have been deemed earned prior to the Effective Date. This Policy will survive and continue notwithstanding any termination of a Covered Person’s employment with the Company and its affiliates.

10.	Successors

This Policy shall be binding and enforceable against all Covered Persons and their successors, beneficiaries, heirs, executors, administrators, or other legal representatives.

Exhibit A

TELESAT CORPORATION

COMPENSATION RECOVERY POLICY

DEFINITIONS EXHIBIT

“ApplicablePeriod” means the three completed fiscal years of the Company immediately preceding the earlier of (i) the date the Board, a committee of the Board, or the officer or officers of the Company authorized to take such action if Board action is not required, concludes (or reasonably should have concluded) that a Restatement is required or (ii) the date a court, regulator, or other legally authorized body directs the Company to prepare a Restatement. The “Applicable Period” also includes any transition period (that results from a change in the Company’s fiscal year) within or immediately following the three completed fiscal years identified in the preceding sentence.

“Board” means the Board of Directors of the Company.

“HumanResources & Compensation Committee” means the Company’s committee of directors responsible for executive compensation decisions, or in the absence of such a committee, a majority of the independent directors serving on the Board.

“CoveredPerson” means any person who is, or was at any time, during the Applicable Period, an Executive Officer of the Company. For the avoidance of doubt, a Covered Person may include a former Executive Officer that left the Company, retired, or transitioned to an employee role (including after serving as an Executive Officer in an interim capacity) during the Applicable Period.

“EffectiveDate” means October 2, 2023.

“ExecutiveOfficer” means the Company’s president, principal executive officer, principal financial officer, principal accounting officer (or if there is no such accounting officer, the controller), any vice-president in charge of a principal business unit, division, or function (such as sales, administration, or finance), any other officer who performs a policy-making function, or any other person (including an officer of the Company’s parent(s) or subsidiaries) who performs similar policy-making functions for the Company.

“FinancialReporting Measure” means a measure that is determined and presented in accordance with the accounting principles used in preparing the Company’s financial statements (including, but not limited to, “non-GAAP” financial measures, such as those appearing in the Company’s earnings releases or Management Discussion and Analysis), and any measure that is derived wholly or in part from such measure. Stock price and total shareholder return (and any measures derived wholly or in part therefrom) shall be considered Financial Reporting Measures.

“Impracticable.” The Human Resources & Compensation Committee may determine in good faith that recovery of Recoverable Incentive Compensation is “Impracticable” if: (i) pursuing such recovery would violate home country law of the jurisdiction of incorporation of the Company where that law was adopted prior to November 28, 2022 and the Company provides an opinion of home country counsel to that effect acceptable to the Company’s applicable listing exchange; (ii) the direct expense paid to a third party to assist in enforcing this Policy would exceed the Recoverable Incentive Compensation and the Company has (A) made a reasonable attempt to recover such amounts and (B) provided documentation of such attempts to recover to the Company’s applicable listing exchange; or (iii) recovery would likely cause an otherwise tax-qualified retirement plan, under which benefits are broadly available to employees of the Company, to fail to meet the requirements of Section 401(a)(13) or Section 411(a) of the Internal Revenue Code of 1986, as amended.

“IncentiveCompensation” means any compensation that is granted, earned, or vested based wholly or in part upon the attainment of a Financial Reporting Measure. Incentive Compensation does not include any base salaries (except with respect to any salary increases earned wholly or in part based on the attainment of a Financial Reporting Measure performance goal); bonuses paid solely at the discretion of the Human Resources & Compensation Committee or Board that are not paid from a “bonus pool” that is determined by satisfying a Financial Reporting Measure performance goal; bonuses paid solely upon satisfying one or more subjective standards and/or completion of a specified employment period; non-equity incentive plan awards earned solely upon satisfying one or more strategic measures or operational measures; and equity awards that vest solely based on the passage of time and/or attaining one or more non-Financial Reporting Measures.

“Received.” Incentive Compensation is deemed “Received” in the Company’s fiscal period during which the Financial Reporting Measure specified in the Incentive Compensation award is attained, even if the payment or grant of the Incentive Compensation occurs after the end of that period.

“RecoverableIncentive Compensation” means the amount of any Incentive Compensation (calculated on a pre-tax basis) Received by a Covered Person during the Applicable Period that is in excess of the amount that otherwise would have been Received if the calculation were based on the Restatement. For the avoidance of doubt, Recoverable Incentive Compensation does not include any Incentive Compensation Received by a person (i) before such person began service in a position or capacity meeting the definition of an Executive Officer, (ii) who did not serve as an Executive Officer at any time during the performance period for that Incentive Compensation, or (iii) during any period the Company did not have a class of its securities listed on a national securities exchange or a national securities association. For Incentive Compensation based on (or derived from) stock price or total shareholder return where the amount of Recoverable Incentive Compensation is not subject to mathematical recalculation directly from the information in the applicable Restatement, the amount will be determined by the Human Resources & Compensation Committee based on a reasonable estimate of the effect of the Restatement on the stock price or total shareholder return upon which the Incentive Compensation was Received (in which case, the Company will maintain documentation of such determination of that reasonable estimate and provide such documentation to the Company’s applicable listing exchange).

“Restatement” means an accounting restatement of any of the Company’s financial statements filed with the Securities and Exchange Commission under the Exchange Act, or the Securities Act of 1933, as amended, due to the Company’s material noncompliance with any financial reporting requirement under U.S. securities laws, regardless of whether the Company or Covered Person misconduct was the cause for such restatement. “Restatement” includes any required accounting restatement to correct an error in previously issued financial statements that is material to the previously issued financial statements (commonly referred to as “Big R” restatements), or that would result in a material misstatement if the error were corrected in the current period or left uncorrected in the current period (commonly referred to as “little r” restatements).

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

FORM 20-F

(Mark One)

☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2023

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☐ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________________________ to ________________________

Commission file number 001-41083

TELESAT CORPORATION

Not Applicable(Translation of Registrant’s name into English)

British Columbia, Canada(Jurisdiction of incorporation or organization)

c/o Telesat Canada160 Elgin StreetSuite 2100Ottawa, Ontario, Canada K2P 2P7Tel: (613) 748-8700

Christopher S. DiFrancescoVice President, General Counsel and Secretaryc/o Telesat Canada160 Elgin StreetSuite 2100Ottawa, Ontario, Canada K2P 2P7Tel: (613) 748-8700 ext. 2268cdifrancesco@telesat.com(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)

Telesat Corporation

Table of Contents

INTRODUCTION

EXPLANATORY NOTE

PRESENTATION OF FINANCIAL INFORMATION

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

INDUSTRY AND MARKET DATA

FREQUENTLY USED TERMS

“BCBCA” means the Business Corporations Act (British Columbia).

“CBCA” means the Canada Business Corporations Act.

PART I

ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE

ITEM 3. KEY INFORMATION

A. Reserved

B. Capitalization and Indebtedness

C. Reasons for the Offer and Use of Proceeds

D. Risk Factors

RISK FACTORS

Summary of Risks

Risks Relating to the Business of Telesat

Risks Relating to Telesat’s Lightspeed Constellation

Risks Relating to Regulatory Matters

Risks Relating to Telesat’s Liquidity and Capital Resources

Risks Relating to Tax Matters

Risks Relating to the Ownership of Telesat Public Shares and Telesat Partnership Units

Risks Relating to the Business of Telesat Corporation

Telesat’s in-orbit satellites may fail to operate as expected due to operational anomalies resulting in lost revenues, increased costs and/or termination of contracts.

Because Telesat’s satellites are complex and are deployed in complex environments, Telesat’s satellites may have defects that are discovered only after full deployment, which could seriously harm Telesat’s business.

Some of Telesat’s satellites have experienced in-orbit anomalies and may in the future experience further anomalies that may affect their performance.

Nimiq Satellites:

Anik Satellites:

Telstar Satellites:

The actual orbital maneuver lives of Telesat satellites may be shorter than it anticipates, and it may be required to reduce available capacity on its satellites prior to the end of their orbital maneuver lives.

Telesat’s business is capital intensive and it may not be able to raise adequate capital to finance its business strategies, or it may be able to do so only on terms that significantly restrict its ability to operate its business.

Replacing a satellite upon the end of its service life will require Telesat to make significant expenditures and may require it to obtain shareholder approval and Telesat may choose not to, or be unable to, replace some of its satellites upon their end of life.

Telesat’s dependence on outside contractors could result in delays related to the design, manufacture and launch of new satellites, or could limit its ability to sell its services, which could adversely affect operating results and prospects.

Changes in consumer demand for traditional television services and expansion of terrestrial networks have adversely impacted the growth in subscribers to DTH television services in North America, which have adversely impacted current and may adversely impact future revenues.

Reductions in government spending could reduce demand for Telesat’s services.

Telesat’s failure to maintain or obtain authorizations under and comply with the U.S. export control and trade sanctions laws and regulations could have a material adverse effect on results of operations, business prospects and financial condition.

The content of third-party transmissions over Telesat satellites could subject Telesat to sanctions by various governmental entities for the transmission of certain content.

Fluctuations in available satellite capacity could adversely affect Telesat’s results.

Telesat is subject to risks associated with doing business internationally.

Spectrum values historically have been volatile, which could cause the value of Telesat’s business to fluctuate.

Changes in technology could have a material adverse effect on Telesat’s results of operations, business prospects and financial condition.

Pandemics could have a material adverse effect on Telesat’s business, financial condition and results of operations.

Telesat may pursue acquisitions, dispositions and strategic transactions which could result in the incurrence of additional costs, liabilities or expenses in connection with the implementation of such transactions.

Telesat could experience the departure of key employees or may be unable to recruit the employees needed for its success.

Telesat’s future reported net income and asset values could be adversely affected by impairments of the value of goodwill and intangible assets.

Significant changes in exchange rates could have a material adverse effect on financial results.

Significant changes in exchange rates could materially increase interest and other payment obligations under Telesat’s financing arrangements.

The soundness of financial institutions and counterparties could adversely affect Telesat.

Risks Relating to Telesat’s Lightspeed Constellation

There are numerous technological risks and uncertainties associated with Telesat’s planned Lightspeed constellation which may cause it to be unsuccessful and have a material adverse effect on Telesat’s results of operations, business prospects and financial condition.

Telesat may be unable to raise sufficient capital to fund the Lightspeed constellation and Telesat may ultimately be unable to, or choose to not, proceed with the project.

Even if Telesat is able to successfully build and deploy the Lightspeed constellation, Telesat may nonetheless fail to generate anticipated revenues due to slow market adoption or because the total addressable market for the Lightspeed constellation may be smaller than Telesat expects.

Telesat faces robust competition to build and effectively deploy its Lightspeed constellation, and/or the pursuit of a LEO constellation may negatively impact Telesat’s existing business.

Risks Relating to Intellectual Property

We may not identify relevant third-party patents or may incorrectly interpret the relevance, scope or expiration of a third-party patent, which might adversely affect our ability to develop and market our services.

We may become a party to intellectual property litigation or administrative proceedings that could be costly and could interfere with our ability to sell and market our services.

Because of the expense and uncertainty of litigation, we may not be in a position to enforce our intellectual property rights against third parties.

If we are unable to protect the confidentiality of our trade secrets and other proprietary information, our business and competitive position may be harmed.

Intellectual property rights do not necessarily address all potential threats to our competitive advantage.

Risks Relating to Regulatory Matters

For the transition period from to