Telesat Canada, the world's fourth largest fixed satellite operator, has an agreement to relinquish its leasehold interest in Telstar 10 to APT Satellite Company Limited (APT), the satellite's owner, and to transfer related customer contracts, for a total consideration of US$69,500,000, subject to adjustment.

Proceeds will be used to fund replacement satellites or repay debt, in accordance with Telesat's financing arrangements. The transaction is one of the transactions previously disclosed as being under consideration involving the possible disposition of certain of Telesat's international satellites. The parties expect to complete the transaction in July 2009. Telesat, through its predecessor company, Loral Skynet, has had a lease arrangement with APT on Telstar 10 for almost a decade. APT operates the satellite and also provides technical support to many Telesat customers.

For the first quarter of 2009, Telstar 10 accounted for approximately 5 percent of Telesat's revenue and less than 1 percent of its $5.3 Billion contracted backlog. Telstar 10, one of Telesat's 12 state-of-the-art satellites, is a hybrid satellite operating in the standard and extended C-bands and the standard Ku-band frequency ranges. The C-Band payload covers Asia, Japan, Australia, and parts of Europe and Africa. The Ku-band payload has focused coverage of China and Korea, including Hong Kong, Macau and Taiwan. As announced previously, Telesat continues to be in discussions regarding the potential sale of its interests in another of its international satellites. However, Telesat cannot at this time assess the probability of concluding any further transaction under discussion or under what terms, including price, the assets may be sold.