TerreStar gets final approval to access $75 million of DIP loan

By Lisa Kerner

Charlotte, N.C., Nov. 18 - TerreStar Networks Inc. was granted final access to its $75 million debtor-in-possession facility from EchoStar Corp., according to a Thursday filing with the U.S. Bankruptcy Court for the Southern District of New York.

The company was granted interim access to $18 million of the facility in October.

As previously reported, the facility will mature on the earliest of nine months from the bankruptcy filing date, 35 days after entry of the interim order if a final order has not been entered, upon a sale of substantially all of TerreStar's assets and the effective date of a plan of reorganization.

Interest will be 15%, paid in kind and added to the principal amount of the DIP loan.

The Bank of New York Mellon is the administrative and collateral agent.

The DIP financing agreement requires TerreStar to file a plan and disclosure statement by Nov. 5 and have the plan confirmed by Feb. 14.

As previously reported, TerreStar filed a plan of reorganization and related disclosure statement on Nov. 5. The plan is based on restructuring transactions supported by EchoStar, its largest secured creditor.

Based in Reston, Va., TerreStar operates satellite-based digital mobile communications systems. The company filed for bankruptcy on Oct. 19, and its Chapter 11 case number is 10-15446.

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