March 28, 2012

Telesat Canada (“Telesat”), a wholly owned subsidiary of Telesat Holdings Inc. (“Holdings”), today announced its entry into a new credit agreement. The new credit agreement provides for the extension of credit under the following senior credit facilities in the principal amount of up to approximately US$2,550 million (together, the “Senior Credit Facilities”):

· a revolving credit facility in the amount of up to C$/US$140 million, available in either Canadian or US dollars, maturing on March 28, 2017;

· a Term Loan A facility denominated in Canadian dollars, in the amount of C$500 million, maturing on March 28, 2017;

· a Term Loan B facility denominated in Canadian dollars, in the amount of C$175 million, maturing on March 28, 2019; and

· a Term Loan B facility denominated in US dollars, in the amount of US$1,725 million, maturing on March 28, 2019.

JP Morgan Chase Bank N.A. (“JP Morgan”) is acting as administrative agent and collateral agent with respect to the Senior Credit Facilities. Canadian Imperial Bank of Commerce (“CIBC”) and JP Morgan acted as joint lead arrangers and joint bookrunners for the revolving credit and Term Loan A facilities. CIBC acted as Syndication Agent for the revolving credit and Term Loan A facilities. Credit Suisse Securities (USA) LLC (“CS Securities”), Morgan Stanley Senior Funding, Inc. (“MS”), UBS Securities LLC (“UBSS”) and ING Bank of Canada (“ING”), acted as co-managers and co-documentation agents for the revolving credit and Term Loan A facilities. J.P. Morgan, CS Securities, MS and UBSS, acted as joint lead arrangers and joint bookrunners for the Term Loan B facility. ING and CIBC acted as co-managers and co‑documentation agents for the Term Loan B facility. MS, CS Securities, and UBSS acted as co‑syndication agents on the Term Loan B.

The proceeds from the Senior Credit Facilities will be used to refinance Telesat’s outstanding borrowings of approximately C$2.1 billion under its previous credit agreement (which agreement has been terminated), and to pay accrued interest, closing costs and other third party expenses related to the transaction. A portion of the proceeds from the Senior Credit Facilities along with approximately C$200 million of existing cash and cash from operations will be used to make payments of approximately C$705 million, including distributions to Holdings’ shareholders in respect of the stated capital of Holdings and special bonus payments to certain executives and employees of Telesat. The payments were announced on February 22, 2012. Approximately C$586 million of the C$705 million has been paid, with the majority of the balance expected to be paid during the remainder of 2012.

Also on March 28, 2012, Holdings completed the redemption of all of its issued and outstanding senior preferred shares, previously held by an affiliate of the Public Sector Pension Investment Board (“PSP Investments”), for approximately C$145.5 million in cash, equal to the principal and accrued dividends on the Holdings senior preferred shares. Following the redemption of the Holdings senior preferred shares, an affiliate of PSP Investments provided a loan in the amount of approximately C$145.5 million to Telesat, which loan is evidenced by a subordinated promissory note (the “Note”). The Note requires payment of at least 50% of the principal amount of the Note on March 31, 2014, with the balance, if any, to be repaid no later than March 31, 2016. Telesat will pay interest on the Note in the amount of 9.75% for the first two years and adjusting thereafter to reflect the then-current market rate (but no less than 11% per annum).