Loral files reorganization plan; Loral bondholders get 19.4% of stock, Orion creditors get 79.0% plus notes

New York, Oct. 22 - Loral Space & Communications Ltd. said it filed its revised plan of reorganization and a disclosure statement with the U.S. Bankruptcy Court for the U.S. Bankruptcy Court for the Southern District of New York.

Under the plan, bondholders and other unsecured creditors will own the company.

Loral bondholders and some other unsecured creditors will receive 19.4% of the reorganized Loral's common stock.

Unsecured creditors of Loral Orion including bondholders will receive 79.0% of new Loral's common stock plus $200 million in new senior secured notes to be issued by reorganized Loral Skynet.

The Orion creditors also will be offered the right to subscribe to an additional $30 million in new Skynet senior secured notes. The rights offering will be backstopped by certain creditors who will receive a fee payable in the notes.

All other general unsecured creditors can choose their share of either 1.6% of the new stock or $30 million in cash.

The revised terms leave Loral's Space Systems/Loral and Loral Skynet intact as separate subsidiaries of the reorganized company. Space Systems/Loral, which designs and manufactures satellites, will emerge debt-free.

Preferred and common stockholders will get nothing.

Loral, a New York satellite company, filed for bankruptcy on July 15, 2003. Its Chapter 11 case number is 03-41710.

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