Loral Files Revised Plan Of
Reorganization And Disclosure Statement
New York NY (SPX) Oct 26, 2004
(thanks to spacedaily.com))
Loral Space & Communications
last Friday (October 22) filed a
revised plan of reorganization (the
"Plan") and a Disclosure
Statement with the Bankruptcy
Court. The company expects to
exit chapter 11 under current
management in the first-quarter of
2005.
The Plan, which revises the terms of a Plan previously filed on
August 19, 2004, reflects a consensual agreement on financial
terms between the company and the Creditors' Committee
appointed in the chapter 11 cases of Loral and certain of its
subsidiaries.
It is subject to final documentation and the resolution of certain
other issues between the company and the Creditors' Committee
and to confirmation by the bankruptcy court. 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). The Disclosure Statement establishes the enterprise
value of New Loral at between approximately $650 million and
approximately $800 million.
- 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 certain other
unsecured creditors, as follows:
- Loral bondholders and certain other unsecured creditors will
receive approximately 19.4 percent of the common stock of New
Loral.
- Loral Orion unsecured creditors, including Loral Orion
bondholders, will receive approximately 79.0 percent of New
Loral's common stock plus $200 million in new senior secured
notes to be issued by reorganized Loral Skynet.
These creditors also will be offered the right to subscribe to
purchase their pro-rata share of an additional $30 million in new
senior secured notes to be issued by reorganized Loral Skynet.
This rights offering will be backstopped by certain creditors who
will receive a fee payable in the notes.
- All other general unsecured creditors will have an option to elect
to receive their pro rata share of approximately 1.6 percent of New
Loral common stock or their pro rata share of $30 million in cash,
subject to adjustment for over-subscription or under-subscription.
- Existing common and preferred stock will be cancelled and no
distribution will be made to current shareholders.
- New Loral will emerge as a public company and will seek listing
on a major stock exchang |
