WorldSpace, Inc. Gains Access to $2M in Interim Dip Financing and Commences Sale Process

  
    
  
  
    
      WorldSpace®, Inc. (NASDAQ:WRSP) a 
      leading provider of satellite radio services outside the U.S., today 
      announced it has received approval of the United States Bankruptcy Court 
      in Delaware for the first part of an interim Debtor-in-Possession (DIP) 
      financing in an amount up to $2M which will enable the Company to meet 
      payroll obligations to critical employees and commence a process to sell 
      the Company or its assets.
    
    
      The Company, along with its U.S. subsidiaries WorldSpace Systems 
      Corporation and AfriSpace, Inc., filed voluntary petitions for 
      reorganization under Chapter 11 of the U.S. Bankruptcy Code in the U.S. 
      Bankruptcy Court in Delaware on Friday, October 17, 2008. In accordance 
      with the terms of the DIP financing facility for which the Company has 
      received initial court approval and intends to seek further approvals in 
      the coming weeks, the Company has commenced a process to market and sell 
      the Company or its assets, or complete an alternative restructuring 
      transaction. The Bank Street Group LLC (www.bankstreetgroup.com) 
      has been appointed as the Company’s financial 
      advisor in support of the sale and/or restructuring process and all 
      interested parties should contact Bank Street (Gary Grant, [e-mail] 
      or Richard Lukaj, [e-mail]) 
      for further information.
    
    
      In other announcements, WorldSpace appointed Robert Schmitz of Quest 
      Turnaround Advisors, LLC as its Chief Restructuring Officer reporting to 
      Chairman and Chief Executive Officer Noah Samara to assist the Company 
      through an orderly sale or recapitalization process.
    
    
      WorldSpace India, a wholly owned independent business unit operating in 
      the market where most of the Company’s 
      customers are located and revenues are generated, has not filed for 
      protection from its creditors and continues its business activities in 
      the ordinary course.
    
    
      As previously stated, WorldSpace will continue to operate its business 
      and manage its assets as a ”debtor-in-possession” 
      under the jurisdiction of the court and in accordance with the 
      applicable provisions of the Bankruptcy Code and the orders of the court.
    
    
      The holders of the Company’s existing senior 
      secured and convertible notes have agreed to provide, subject to the 
      satisfaction of certain conditions, a DIP financing facility of up to 
      $13M for a period of 90 days in order to facilitate a sale transaction. 
      The financing facility is expected to enable the Company to continue to 
      pay salaries of critical employees and continue operations which are 
      critical to preserving the value of its core assets through the term of 
      the facility.
    
    
      About 1worldspaceTM
    
    
      Based in the Washington, DC metropolitan area, 1worldspaceTM 
      is the world's only global media and entertainment company positioned to 
      offer a satellite radio experience to consumers in more than 130 
      countries with five billion people, driving 300 million cars. 1worldspace 
      award-winning programming provides subscribers with a combination of 
      news, sports, music, talk and entertainment, as well as brand-name 
      content and educational programming. Leading brands from around the 
      globe found on 1worldspace include the BBC, Absolute Radio 
      (formerly Virgin Radio UK), and RFI.
    
    
      1worldspace satellites cover two-thirds of the earth and enable 
      the Company to offer a wide range of innovative services for enterprises 
      and governments globally, including distance learning, alert delivery, 
      data delivery, and disaster readiness and response systems. 1worldspace 
      is a pioneer of satellite-based digital radio services and was 
      instrumental in the early development of the technology infrastructure 
      used today by XM Satellite Radio. For more information, visit www.1worldspace.com.
    
    
      Forward Looking Statements
    
    
      This press release may contain certain forward-looking statements 
      within the meaning of the Private Securities Litigation Reform Act of 
      1995. These statements are based on management's current expectations or 
      beliefs about future events and financial, political and social trends 
      and assumptions it has made based on information currently available to 
      it. The Company cannot assure that any expectations, forecasts or 
      assumptions made by management in preparing these forward-looking 
      statements will prove accurate, or that any projections will be 
      realized. Such forward-looking statements may be affected by inaccurate 
      assumptions or by known or unknown risks or uncertainties. Actual 
      results may vary materially from those expressed or implied by the 
      statements herein. For factors that could cause actual results to vary, 
      perhaps materially, from these forward-looking statements, please refer 
      to the Company's Form 10-K, filed with the Securities and Exchange 
      Commission, and other subsequent filings. Forward-looking statements 
      contained herein speak only as of the date of this release. The Company 
      does not undertake any obligation to update or revise publicly any 
      forward-looking statements, whether to reflect new information, future 
      events or otherwise.