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Globalstar gets extension on financing repayments

Globalstar has entered into an amendment to its COFACE credit facility agreement, which has extended the initial principal repayment date on its debt beyond 2012.

In June 2009, Globalstar entered into a $586.3 million senior secured credit facility agreement. Ninety-five per cent of the company's obligations under the facility agreement are guaranteed by COFACE, the French export credit agency.

The facility bears interest at a floating 6-month LIBOR rate, plus a margin of 2.07 per cent through December 2012, increasing to 2.25 per cent through December 2017 and 2.40 per cent thereafter.

According to the amendment, the first repayment date will now be as late as June 2013 instead of June 2012. The precise date is dependent on the date of Globalstar's fourth launch of second-generation satellites, and will be the earlier of June 2013 or eight months post-launch.

The deal also makes further adjustments to the facility's financial and operating covenants.

"We are pleased to announce these important changes to the financing agreement as it provides Globalstar with the added flexibility to complete the four launches of our new satellite constellation, restore our network coverage and begin revenue recovery prior to making principal facility payments," said Jay Monroe, chairman and CEO of Globalstar, Inc.

"I would like to acknowledge and thank both COFACE and members of the French lending group for the consideration they have shown permitting the completion of this milestone amendment."

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