Consensual Plan Supported by Creditors' Committee
NEW YORK, Aug. 19 /PRNewswire-FirstCall/ -- Loral Space & Communications
Ltd. (OTC Bulletin Board: LRLSQ) and certain of its subsidiaries today filed a
proposed plan of reorganization (the Plan) with the U.S. Bankruptcy Court for
the Southern District of New York. The Plan is supported by the Official
Committee of Unsecured Creditors appointed in Loral's chapter 11 case. The
company expects to exit chapter 11 under current management before the end of
the year.
The Plan, which is subject to confirmation by the bankruptcy court,
resulted from negotiations between the company and the Creditors' Committee to
implement the previously announced agreement in principle. It provides, among
other things, that:
* Loral's two businesses, Space Systems/Loral and Loral Skynet, will
emerge intact as separate subsidiaries of reorganized Loral (New Loral).
* Space Systems/Loral, the satellite design and manufacturing business,
will emerge debt-free.
* The common stock of New Loral will be owned by Loral bondholders, Loral
Orion bondholders and other unsecured creditors. In addition,
bondholders and other creditors of Loral Orion will receive an aggregate
of $200 million in new senior secured notes to be issued by reorganized
Loral Skynet, New Loral's satellite services subsidiary.
* New Loral will emerge as a public company and will seek listing on a
major stock exchange.
* Existing common and preferred stock will be cancelled and no
distribution will be made to current shareholders.
The plan of reorganization is available via the court's website, at
http://www.nysb.uscourts.gov/. Please note that a PACER password is required
to access documents on the Bankruptcy Court's website. Loral's bankruptcy
case number is 03-41710 (RDD).
Loral Space & Communications is a satellite communications company. It
owns and operates a fleet of telecommunications satellites used to broadcast
video entertainment programming, distribute broadband data, and provide access
to Internet services and other value-added communications services. Loral also
is a world-class leader in the design and manufacture of satellites and
satellite systems for commercial and government applications including
direct-to-home television, broadband communications, wireless telephony,
weather monitoring and air traffic management.
This document contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. In addition, Loral Space &
Communications Ltd. or its representatives have made or may make forward-
looking statements, orally or in writing, which may be included in, but are
not limited to, various filings made by the company with the Securities and
Exchange Commission, press releases or oral statements made with the approval
of an authorized executive officer of the company. Actual results could differ
materially from those projected or suggested in any forward-looking statements
as a result of a wide variety of factors and conditions. These factors include
those related to the filing, on July 15, 2003 by Loral and certain of its
subsidiaries, of voluntary petitions for reorganization under chapter 11 of
title 11 of the United States Code in the United States District Court for the
Southern District of New York and parallel insolvency proceedings in the
Supreme Court of Bermuda in which certain partners of KPMG were appointed as
joint provisional liquidators. Additional factors and conditions are also
described in the section of the company's annual report on Form 10-K for the
fiscal year ended December 31, 2003, entitled "Commitments and Contingencies,"
and the company's other filings with the Securities and Exchange Commission.
The reader is specifically referred to these documents.
Contact: Jeanette Clonan
(212) 697-1105
SOURCE Loral Space & Communications Ltd.
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Related links:
http://www.loral.com
http://www.nysb.uscourts.gov
CONTACT:
Jeanette Clonan of Loral, +1-212-697-1105
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