Loral Space mmunications : Annual Report

• ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2016‌‌

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

(Exact name of registrant specified in the charter) Jurisdiction of incorporation: Delaware IRS identification number: 87-0748324

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 and posted on its corporate Web site, if any, every interactive Data File required to be submitted and posted 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 and post such files). Yes  no 

indicate by check mark if disclosure of delinquent filers pursuant to item 405 of regulation s-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in part iii of this Form 10-K or any amendment to this Form 10-

K. Yes  no 

indicate by check mark whether the registrant is a large accelerated filer, and accelerated filer, a non-accelerated filer, or a smaller reporting company. see the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in ruler 12b-2 of the Exchange act. (Check one):

Large accelerated filer  accelerated filer  non-accelerated filer  smaller reporting company 

(Do not check if a smaller reporting company)

indicate by check mark whether the registrant is a shell company (as defined in Exchange act rule 12b-2 of the act). Yes  no 

at February 17, 2017, 21,427,078 shares of the registrant's voting common stock and 9,505,673 shares of the registrant's non-voting common stock were outstanding.

as of June 30, 2016, the aggregate market value of the common stock, the only common equity of the registrant currently issued and outstanding, held by non- affiliates of the registrant, was approximately $448,782,710

indicate by a check mark whether the registrant has filed all documents and reports required to be filed by section 12, 13 or 15(d) of the securities Exchange act of 1934 subsequent to the distribution of securities under a plan confirmed by a court. Yes  no 

portions of the registrant's proxy statement for its 2017 annual Meeting of stockholders, which is to be filed subsequent to the date hereof, are incorporated by reference into part iii of this annual report on Form 10-K.

L ORAL SPACE AND COMMUNICATIONS INC. INDEX TO ANNUAL REPORT ON FORM 10-K

PARTI

item 1: Business3

item 1a: risk Factors16

item 1B: Unresolved staff Comments35

item 2: properties35

item 3: Legal proceedings35

item 4: Mine safety Disclosures35

PARTII

item 5: Market for registrant's Common Equity, related stockholder Matters and issuer purchases of Equity securities36

item 6: selected Financial Data39

item 7: Management's Discussion and analysis of Financial Condition and results of operations41

item 7a: Quantitative and Qualitative Disclosures about Market risk58

item 8: Financial statements and supplementary Data59

item 9: Changes in and Disagreements with accountants on accounting and Financial Disclosure59

item 9a: Controls and procedures60

item 9B: other information62

PARTIII

item 10: Directors, Executive officers and Corporate governance62

item 11: Executive Compensation62

item 12: security ownership of Certain Beneficial owners and Management and related stockholder Matters62

item 13: Certain relationships and related Transactions, and Director independence62

item 14: principal accountant Fees and services62

PARTIV

item 15: Exhibits and Financial statement schedule63

signatures 68

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Loral space & Communications inc., together with its subsidiaries ("Loral," the "Company," "we," "our" and "us"), is a leading satellite communications company engaged, through our ownership interests in affiliates, in satellite-based communications services.

Loral has one operating segment consisting of satellite-based communications services.

Loral participates in satellite services operations through its 62.7% economic interest in Telesat Canada ("Telesat"), a leading global fixed satellite services operator, with offices and facilities around the world. Effective January 1, 2017, Telesat holdings inc. completed a corporate reorganization pursuant to which Telesat holdings inc. amalgamated with Telesat interco inc., a wholly owned subsidiary, and immediately thereafter the newly amalgamated company amalgamated with Telesat Canada. The continuing entity, existing under the laws of Canada, is named Telesat Canada.

Telesat owns and leases a satellite fleet that operates in geosynchronous earth orbit approximately 22,000 miles above the equator. in this orbit, satellites remain in a fixed position relative to points on the earth's surface and provide reliable, high-bandwidth services anywhere in their coverage areas, serving as the backbone for many forms of telecommunications. Telesat is also developing a global constellation of low earth orbit ("LEo") satellites. LEo satellites operate in a circular orbit around the earth with an altitude typically between 500 and 870 miles. Unlike geosynchronous satellites that operate in a fixed orbital location above the equator, LEo 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 geosynchronous orbit 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 potentially better than terrestrial services.

at December 31, 2016, Telesat provided satellite services to customers from its fleet of 15 in-orbit geostationary satellites. in addition, Telesat owns the Canadian Ka-band payload on the viasat-1 satellite, has two other geostationary satellites under construction and has an additional two prototype Ka-band satellites under construction, which will be deployed in low earth orbit. Telesat also manages the operations of additional satellites for third parties.

Telesat provides video distribution and direct-to-home ("DTh") video, as well as end-to-end communications services using both satellite and hybrid satellite- ground networks.

our economic interest decreased from 62.8% to 62.7% in March 2016 when certain Telesat employees exercised share appreciation rights related to a total of 178,642 stock options granted under Telesat's share-based compensation plan and received 129,400 non-voting participating preferred shares.

Telesat Services

Telesat earns the majority of its revenues by providing satellite-based services to customers, who use these services for their own communications requirements or to provide services to customers further down the distribution chain for video and data services. Telesat also earns 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. Telesat categorizes its revenues into: Broadcast, Enterprise, and Consulting and other.

Broadcast

Telesat's broadcast services business provided approximately 52% of its revenue for the year ended December 31, 2016. These services include:

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