EXHIBIT 2.3
UNITED STATES BANKRUPTCY COURT
SOUTHERN DISTRICT OF NEW YORK
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:
In re : Chapter 11 Case Nos.
:
LORAL SPACE : LEAD CASE 03-41710 (RDD)
& COMMUNICATIONS LTD., et al., : 03-41709 (RDD) through
: 03-41728 (RDD)
Debtors. : (Jointly Administered)
:
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ORDER CONFIRMING DEBTORS' FOURTH
AMENDED JOINT PLAN OF REORGANIZATION UNDER
CHAPTER 11 OF THE BANKRUPTCY CODE, AS MODIFIED
The Debtors' Fourth Amended Joint Plan of Reorganization Under Chapter 11
of the Bankruptcy Code, dated June 3, 2005, having been filed with the United
States Bankruptcy Court for the Southern District of New York (the "Bankruptcy
Court") by Loral Space & Communications Ltd. ("Loral Ltd.") and its affiliated
debtors in the above referenced chapter 11 cases (collectively, the
"Debtors")(3); and the Plan Documents (as such documents have been or may be
further amended or supplemented, the "Plan Supplement") having been filed with
the Bankruptcy Court by the Debtors on June 29, 2005; and the Bankruptcy Court
having entered, after due notice and a hearing, an Order, dated June 3, 2005,
(i) Approving the Notice of the Disclosure Statement Hearing; (ii) Approving the
Disclosure Statement; (iii) Fixing a Record Date; (iv) Approving the Notice and
Objection Procedures in Respect of Confirmation of the Plan;
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(3) Such plan, as amended and modified as provided herein, is hereinafter
referred to as the "Plan of Reorganization." Unless otherwise defined herein,
capitalized terms shall have the meanings ascribed to such terms in the Plan of
Reorganization. A copy of the Plan of Reorganization is annexed hereto as
Exhibit A.
(v) Approving Solicitation Packages and Procedures for the Distribution Thereof;
(vi) Approving the Forms of Ballots and Establishment of Procedures for Voting
on the Plan and Setting Date for Hearing on Confirmation of Plan; (vii)
Approving the Form of Notices to Non-Voting Classes Under the Plan; and (viii)
Approving the Subscription Form for Purposes of the Rights Offering (the
"Disclosure Statement Order"); and the Disclosure Statement for Debtors' Fourth
Amended Joint Plan of Reorganization Under Chapter 11 of the Bankruptcy Code
(the "Disclosure Statement") and the Plan of Reorganization and the Solicitation
Packages (as defined below) having been distributed to holders of Claims
entitled to vote thereon as provided in the Disclosure Statement Order; and due
notice of (i) entry of the Disclosure Statement Order, (ii) the Confirmation
Hearing, (iii) the deadline for voting on, and/or objecting to, the Plan of
Reorganization having been provided to holders of Claims against and Equity
Interests in the Debtors and other parties in interest in accordance with the
Disclosure Statement Order, the Bankruptcy Code and the Federal Rules of
Bankruptcy Procedure (the "Bankruptcy Rules"), as established by the affidavits
of service, mailing, and/or publication filed with the Bankruptcy Court
(collectively, the "Notice Affidavits"),(4) and (iv) the final date by which a
holder of an Orion General Unsecured Claim may elect to subscribe to the Rights
Offering, including the subsequent notice of this extended deadline, having been
filed with the Bankruptcy Court on July 1, 2005, and such notice
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(4) The Notice Affidavits include the following: (i) Affidavit of
Publication of The Wall Street Journal (Global), sworn to on June 9, 2005 by
Mike Henley, Advertising Clerk of the Publisher of The Wall Street Journal
(Global), and filed with the Court on June 14, 2005 [Docket No. 2092]; (ii)
Affidavit of Publication of The New York Times, sworn to on June 9, 2005 by Jo
Sniderski, Principal Clerk of the Publisher of The New York Times, and filed
with the Court on June 14, 2005 [Docket No. 2093]; (iii) Affidavit of
Publication of the International Herald Tribune, sworn to on June 13, 2005 by
Judith King, principal and Legal Notice Manager of the International Herald
Tribune, and filed with the Court on June 14, 2005 [Docket No. 2094]; and (iv)
Affidavit of Service of Jane Sullivan of Financial Balloting Group LLC, sworn to
on June 15, 2005, and filed with the Court on June 16, 2005 [Docket No. 2105].
being sufficient under the circumstances and no other or further notice being
required; and the Disclosure Statement (with the Plan of Reorganization annexed
thereto as Exhibit A) and the Plan Supplement having been posted at
www.bsillc.com in accordance with the Disclosure Statement Order; and after full
consideration of (i) the Debtors' Memorandum of Law in Support of Confirmation
of Debtors' Fourth Amended Joint Plan of Reorganization Under Chapter 11 of the
Bankruptcy Code, dated July 12, 2005, (ii) the certification filed by the
Debtors' Bankruptcy Court-appointed voting and tabulation agent, Financial
Balloting Group LLC ("FBG"), dated July 11, 2005, regarding the methodology
applied to the tabulation of the voting results and the voting results with
respect to Plan of Reorganization (the "Voting Affidavit"), (iii) each of the
responses, objections and reservations filed by certain parties (collectively,
the "Objectors") with respect to confirmation of the Plan of Reorganization,
including (a) the Objection to Confirmation on the Basis That Fees Assessed by
Professionals Representing Debtor/Creditor Entity as Well as Significant
Post-Petition Increases in Executive Compensation of the Debtor Have Been
Improperly Charged to the Debtor. The Values of the Debtor Have Contracted,
Hence These Fees and Excessive Compensation Should Be Disgorged During the
Post-Petition Period and Returned to the Estates at Confirmation Which Is to Be
Heard on July 13, 2005, dated July 13, 2005 [Docket No. 2176] (the "LSPC Fee
Objection"), filed by Tony Christ on behalf of the unofficial Loral Stockholders
Protective Committee (the "LSPC"), (b) the Letter from Margaret & William
Harrison, dated July 2, 2005 [Undocketed] (the "Harrison Letter"), (c) the ERISA
Plaintiffs' Objection to Confirmation of Debtors' Fourth Amended Joint Plan of
Reorganization Under Chapter 11 of the Bankruptcy Code, dated July 7, 2005
[Docket
No. 2158] (the "ERISA Objection"), (d) the Oracle Corporation's Objection to
Debtors' Fourth Amended Joint Plan of Reorganization Under Chapter 11 of the
Bankruptcy Code, dated July 7, 2005 [Docket No. 2159] (the "Oracle Objection"),
(e) the Objection of the Official Committee of Equity Security Holders (the
"Equity Committee") to Confirmation of the Debtors' Fourth Amended Joint Plan of
Reorganization Under Chapter 11 of the Bankruptcy Code, dated July 7, 2005
[Docket No. 2160] (the "Equity Committee's Objection"), (f) the Limited
Objection of the LM Entities to Debtors' Fourth Amended Joint Plan of
Reorganization Under Chapter 11 of the Bankruptcy Code [Docket No. 2170] (the
"LM Objection"), (g) the Reservation of Rights of MHR Fund Management LLC in
Connection With the Debtors' Fourth Amended Joint Plan of Reorganization Under
Chapter 11 of the Bankruptcy Code, dated July 8, 2005 [Docket No. 2168] (the
"MHR Reservation"), (h) the Motion Objecting to Feasibility Under 1129(a) (11)
of the Fourth Amended Plan & Disclosure Statements or the Plan Significantly
Understates Loral's Values, the Fiduciaries Have Not Shown Adequate Duty or
Care, dated July 11, 2005 [Undocketed] (the "LSPC Confirmation Objection"), and
(i) the Report of Findings from Loral Ltd. Contracts for Satellites and Services
in Support of the LSPC's Opposition to Debtors' Fourth Amended Joint Plan of
Reorganization Under Chapter 11 of the Bankruptcy Code, undated [Undocketed]
(the "Ivaldy Pleading;" and, together with the LSPC Fee Objection, the Harrison
Letter, the Oracle Objection, the Equity Committee's Objection, the LM
Objection, the MHR Reservation and the LSPC Confirmation Objection,
collectively, the "Objections"), (iv) the responses to the Objections filed with
the Bankruptcy Court, including (x) the Debtors' Omnibus Response to Objections
to Confirmation of the Plan, dated July 12,
2005, and (y) the Official Committee of Unsecured Creditors' Memorandum of Law
in Support of Confirmation of Debtors' Fourth Amended Joint Plan of
Reorganization Under Chapter 11 of the Bankruptcy Code, Omnibus Reply to Plan
Confirmation Objections and Objection to Motion for Leave to Prosecute Claim,
dated July 12, 2005; and the hearing to consider confirmation of the Plan of
Reorganization having been held before the Bankruptcy Court on July 13, 15, 18,
19, 20, 21 and 25, 2005 (the "Confirmation Hearing"); and the Bankruptcy Court
having reviewed and considered the Plan of Reorganization, the Disclosure
Statement, the Disclosure Statement Order, the Plan Supplement, the Objections
and the responses thereto and all related documents; and the appearance of all
interested parties having been duly noted in the record of the Confirmation
Hearing, including the testimony therein and the exhibits admitted into
evidence; and upon all of the proceedings had before the Bankruptcy Court and
upon the entire record of the Confirmation Hearing; and the Bankruptcy Court
having determined based upon all of the foregoing that the Plan of
Reorganization should be confirmed, as reflected by the Bankruptcy Court's
rulings made herein and on the record of the Confirmation Hearing including,
without limitation, the Bankruptcy Court's decision (the "Decision") rendered at
the conclusion of the Confirmation Hearing on July 25, 2005; and after due
deliberation and sufficient cause appearing therefor, it hereby is DETERMINED,
FOUND, ADJUDGED, DECREED:
FINDINGS OF FACT
A. Findings. The findings set forth herein and in the record of
the Confirmation Hearing constitute the Bankruptcy Court's
findings of fact pursuant to Rule 52 of the Federal Rules of
Civil Procedure, as
made applicable herein by Bankruptcy Rules 7052 and 9014. To
the extent any of the following findings of fact constitute
conclusions of law, they are adopted as such.
B. Exclusive Jurisdiction, Venue, Core Proceeding (28 U.S.C.
Sections 157(b)(2), 1334(a)). This Court has jurisdiction over
the Debtors' Reorganization Cases, the confirmation of the
Plan of Reorganization and the Objections pursuant to 28
U.S.C. Section 1334. Confirmation of the Plan of
Reorganization is a core proceeding pursuant to 28 U.S.C.
Section 157(b), and this Court has jurisdiction to enter a
final order with respect thereto. Venue is proper before this
Court pursuant to 28 U.S.C. Sections 1408 and 1409.
C. Commencement of the Reorganization Cases. On July 15, 2003
(the "Commencement Date"), the Debtors commenced with this
Court voluntary cases under chapter 11 of the Bankruptcy Code.
By Order of this Court, dated July 15, 2003, the
Reorganization Cases were consolidated for procedural purposes
only and have been jointly administered. The Debtors have
operated their businesses and managed their properties as
debtors in possession pursuant to sections 1107(a) and 1108 of
the Bankruptcy Code. No trustee has been appointed in these
cases.
D. Judicial Notice. The Bankruptcy Court takes judicial notice of
the docket of the Debtors' Reorganization Cases maintained by
the Clerk of the Bankruptcy Court, including, without
limitation, all pleadings
and other documents filed, all orders entered, and all
evidence and arguments made, proffered, adduced and/or
presented at the hearings held before the Bankruptcy Court
during the pendency of the Reorganization Cases.
E. Burden of Proof. The Debtors have met their burden of proving
the elements of sections 1129(a) and (b) of the Bankruptcy
Code by a preponderance of the evidence.
F. Solicitation and Notice. On June 3, 2005, the Bankruptcy Court
entered the Disclosure Statement Order, which, among other
things, approved the Disclosure Statement, finding that it
contained "adequate information" within the meaning of section
1125 of the Bankruptcy Code, and established procedures for
the Debtors' solicitation of votes on the Plan of
Reorganization. The (a) Disclosure Statement, (b) Disclosure
Statement Order, (c) Notice of (i) Approval of Disclosure
Statement; (ii) Establishment of Record Date; (iii) Hearing on
Confirmation of the Plan and Procedures for Objecting to
Confirmation of the Plan; and (iv) Procedures and Deadline for
Voting on the Plan (the "Confirmation Hearing Notice"), (d)
Ballots and (e) Subscription Forms (collectively, the
"Solicitation Packages") were served in compliance with the
Bankruptcy Rules and the Disclosure Statement Order. As
described in the Disclosure Statement Order and as evidenced
by the Notice Affidavits, (i) the service of the Solicitation
Packages was adequate and sufficient under the circumstances
of these
Reorganization Cases, and (ii) adequate and sufficient notice
of the Confirmation Hearing and other requirements, deadlines,
hearings and matters described in the Disclosure Statement
Order was timely provided in compliance with the Bankruptcy
Rules, and provided due process to all parties in interest.
G. As is evidenced by the Notice Affidavits, all parties required
to be provided notice of the Confirmation Hearing (including
the deadline for filing and serving objections to confirmation
of the Plan of Reorganization) have been given due, proper,
timely and adequate notice in compliance with the Bankruptcy
Code, the Bankruptcy Rules and the Disclosure Statement Order,
and have had an opportunity to appear and be heard with
respect thereto. No other or further notice is required.
H. Voting. Votes on the Plan of Reorganization were solicited
after disclosure of "adequate information" as defined in
section 1125 of the Bankruptcy Code. As evidenced by the
Voting Affidavit, votes to accept or reject the Plan of
Reorganization have been solicited and tabulated fairly, in
good faith and in a manner consistent with the Disclosure
Statement Order, the Bankruptcy Code and the Bankruptcy Rules.
I. Plan Supplement. On June 29, 2005, the Debtors filed the Plan
Supplement, which includes the following documents: (i) draft
New Skynet Notes Indenture, (ii) Form of New Skynet Note,
(iii)
Registration Rights Agreement (New Loral Common Stock, New
Skynet Preferred Stock and New Skynet Notes), (iv)
Subscription Forms for Rights Offering, (v) New Loral
Certificate of Incorporation, (vi) New Loral Bylaws, (vii) New
Skynet Certificate of Incorporation, (viii) Certificate of
Designation of New Skynet Preferred Stock, (ix) New Skynet
Bylaws, (x) New SS/L Certificate of Incorporation, (xi) New
SS/L Bylaws, (xii) Loral SpaceCom Corporation Certificate of
Incorporation, (xiii) Loral SpaceCom Corporation Bylaws, (xiv)
Loral Space & Communications Holdings Corporation (f/k/a Loral
Space & Communications Corporation) Certificate of
Incorporation, (xv) Loral Space & Communications Holdings
Corporation (f/k/a Loral Space & Communications Corporation)
Bylaws, (xvi) Certificate of Amendment to Certificate of
Incorporation of (a) Loral Space & Communications Corporation
(n/k/a Loral Space & Communications Holdings Corporation), (b)
Loral Communications Services, Inc., (c) Loral CyberStar
Services, Inc., (d) Loral Skynet Network Services, Inc. and
(e) Loral CyberStar International, Inc., (xvii) Backstop
Commitment Agreement, (xviii) New Management Stock Plan, (xix)
Form of New Loral Employment Contract, (xx) Form of Employment
Contract of Bernard L. Schwartz, (xxi) SERP Amendment, (xxii)
List of Subsidiaries that Will Be Merged or Dissolved and
Assets to Be Transferred, (xxiii) Schedule of Executory
Contracts and Unexpired Leases to Be Assumed Pursuant to the
Plan (Schedule 8.1 to the Plan
of Reorganization) and (xxiv) List of Surviving Debtors Whose
Organizational Documents Are Not Being Revised. In addition,
on June 29, 2005 (as supplemented on June 30, 2005), an
updated draft form of the Indenture for the New Skynet Notes
(the "Indenture"), and a marked copy of the Indenture showing
changes from the form Indenture that was filed as an Exhibit
to the Form T-3 with the Securities and Exchange Commission,
were each filed by the Debtors with this Court as an exhibit
to the Plan Supplement. In addition, on or about July 1, 2005,
the Debtors filed with this Court and sent to holders of Orion
General Unsecured Claims the Notice of Extension of
Subscription Expiration Date in Connection with the Debtors'
Fourth Amended Joint Plan of Reorganization Under Chapter 11
of the Bankruptcy Code. Thereafter, the Debtors sent to each
holder of an Orion General Unsecured Claim the following: (i)
revised Subscription Forms in connection with the notice of
the extension of the Subscription Expiration Date, and (ii) a
revised term sheet (the "Revised Term Sheet") marked to show
the significant differences between the terms contained in the
term sheet attached as Exhibit B to the Plan of Reorganization
and the terms of the Indenture filed as part of the Plan
Supplement. In addition, a copy of the Revised Term Sheet and
the Indenture was posted at www.bsillc.com. All such materials
shall be included in the definition of Plan Supplement for
purposes hereof. All such materials comply with the terms of
the Plan
of Reorganization, and the notice of such documents is good
and proper in accordance with the Bankruptcy Code, the
Bankruptcy Rules and the Disclosure Statement Order.
MODIFICATIONS TO THE PLAN OF REORGANIZATION
J. The following modifications are hereby made to the Plan of
Reorganization:
a) The Plan of Reorganization is modified to include
the following Section:
11.12. LIMITATIONS ON EXCULPATION AND RELEASES OF
REPRESENTATIVES.
Nothing in Sections 11.8 or 11.9 of the Plan of
Reorganization shall (i) be construed to release or
exculpate any entity from fraud, malpractice, criminal
conduct, intentional unauthorized misuse of confidential
information that causes damages, or ultra vires acts, or
(ii) limit the liability of the professionals of the
Debtors, the Reorganized Debtors, the Creditors'
Committee or the Equity Committee to their respective
clients pursuant to DR 6-102 of the Code of Professional
Responsibility.
b) Section 8.7 of the Plan of Reorganization shall
include the following additional language:
Notwithstanding the provisions of Section 8.7 of
the Plan of Reorganization, New Loral shall indemnify,
hold harmless and reimburse all persons who are or were
directors, officers and/or employees of the Debtors on
the Commencement Date or at any time thereafter against
and for any and all obligations incurred directly or
indirectly with respect to any taxes owed by the Debtors
for the period prior to the Effective Date (including
interest and penalties) to any governmental entity and
as to which the Debtors are the primary obligors.
Nothing herein shall in any way limit any rights to
indemnification of any post-Effective Date directors,
officers and/or employees with respect to any taxes owed
by the Reorganized Debtors with respect to the period
subsequent to the Effective Date.
c) Exhibit B to the Plan of Reorganization shall be
replaced in its entirety with Exhibit B annexed
hereto.
K. The Plan of Reorganization, as modified by the above
modifications (the "Modifications"), shall constitute the Plan
of Reorganization.
L. The Modifications do not adversely affect the treatment of any
Claims against or Equity Interests in the Debtors under the
Plan of Reorganization.
M. In accordance with Bankruptcy Rule 3019, all holders of Claims
against the Debtors who voted to accept the Plan of
Reorganization are hereby deemed to have accepted the Plan of
Reorganization as amended consistent with the Modifications.
N. No holder of a Claim against the Debtors who has voted to
accept the Plan of Reorganization shall be permitted to change
its acceptance to a rejection as a consequence of the
Modifications.
O. The Debtors' disclosure of the Modifications, including on the
record of the Confirmation Hearing, constitutes due and
sufficient notice thereof.
P. The Modifications incorporated in the Plan of Reorganization
comply with section 1127 of the Bankruptcy Code and Bankruptcy
Rule 3019.
COMPLIANCE WITH THE REQUIREMENTS OF SECTION 1129 OF THE BANKRUPTCY CODE
Q. Plan of Reorganization's Compliance With the Bankruptcy Code
(11 U.S.C. Section 1129(a)(1)). The Plan of Reorganization
complies with the applicable provisions of the Bankruptcy Code
and, as required by
Bankruptcy Rule 3016(a), the Plan of Reorganization is dated
and identifies the Debtors as the Plan of Reorganization
proponents, thereby satisfying section 1129(a)(1) of the
Bankruptcy Code.
R. Proper Classification (11 U.S.C. Sections 1122, 1123(a)(1)).
As required by section 1123(a)(1) of the Bankruptcy Code, in
addition to Administrative Expense Claims and Priority Tax
Claims, which need not be classified, Section 3.1 of the Plan
of Reorganization designates twenty-two (22) Classes of Claims
against and Equity Interests in the Debtors, comprised of
seventeen (17) Classes of Claims and five (5) Classes of
Equity Interests. As required by section 1122(a) of the
Bankruptcy Code, the Claims and Equity Interests placed in
each Class are substantially similar to other Claims and
Equity Interests, as the case may be, in each such Class. A
reasonable basis exists for separately classifying the various
Classes of Claims and Equity Interests under the Plan of
Reorganization. The separate classification of various Claims
and Equity Interests under the Plan of Reorganization is
reasonable and necessary and complies with sections 1122 and
1123(a)(1) of the Bankruptcy Code.
S. Specified Unimpaired Classes (11 U.S.C. Section 1123(a)(2)).
Section 3.1 of the Plan of Reorganization specifies that Ltd.
Class 1 (Other Priority Claims against the Ltd. Debtors), Ltd.
Class 2 (Secured Tax Claims against the Ltd. Debtors),(5) Ltd.
Class 3 (Secured Claim against
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(5) No holders of Claims in Ltd. Class 2 (Secured Tax Claims against the
Ltd. Debtors), Orion Class 2 (Secured Tax Claims against the Orion Debtors) and
SS/L Class 2 (Secured Tax Claims against the SS/L
the Ltd. Debtors), Orion Class 1 (Other Priority Claims
against the Orion Debtors), Orion Class 2 (Secured Tax Claims
against the Orion Debtors), Orion Class 3 (Secured Claims
against the Orion Debtors), Orion Class 5 (Orion Equity
Interests), SpaceCom Class 1 (Other Priority Claims against
the SpaceCom Debtors), SpaceCom Class 3 (Secured Claims
against the SpaceCom Debtors), SpaceCom Class 4 (SpaceCom
General Unsecured Claims), SpaceCom Class 5 (SpaceCom Equity
Interests), SS/L Class 1 (Other Priority Claims against the
SS/L Debtors), SS/L Class 2 (Secured Tax Claims against the
SS/L Debtors), SS/L Class 3 (Secured Claims against the SS/L
Debtors), SS/L Class 4 (SS/L General Unsecured Claims) and
SS/L Class 5 (SS/L Equity Interests) are unimpaired under the
Plan of Reorganization, thereby satisfying section 1123(a)(2)
of the Bankruptcy Code.
T. Specified Treatment of Impaired Classes (11 U.S.C. Section
1123(a)(3)). Section 3.1 of the Plan of Reorganization
designates Ltd. Class 4 (Ltd. General Unsecured Claims), Ltd.
Class 5 (Ltd. Preferred Stock Interests), Ltd. Class 6 (Ltd.
Equity Interests), Ltd. Class 7 (Securities Litigation
Claims), Orion Class 4 (Orion General Unsecured Claims) and
SpaceCom Class 2 (Secured Tax Claims against the SpaceCom
Debtors) as impaired, and Sections 4.4, 4.5, 4.6, 4.7, 4.11
and 4.14 of
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Debtors) voted to accept or reject the Plan of Reorganization. As authorized
under Sections 4.2, 4.9 and 4.19 of the Plan of Reorganization, the Debtors have
determined to pay holders of Allowed Secured Tax Claims against the Ltd.
Debtors, the Orion Debtors and the SS/L Debtors, if any, in full, plus interest.
As a result, Ltd. Class 2, Orion Class 2 and SS/L Class 2 are unimpaired and are
deemed to have accepted the Plan. 11 U.S.C. Sections 1124 and 1126(f).
the Plan of Reorganization, respectively, set forth the
treatment of such impaired Claims and Equity Interests,
thereby satisfying section 1123(a)(3) of the Bankruptcy Code.
U. No Discrimination (11 U.S.C. Section 1123(a)(4)). Section 4 of
the Plan of Reorganization provides for the same treatment by
the Debtors for each Claim or Equity Interest in each
respective Class unless the holder of a particular Claim or
Equity Interest has agreed to a less favorable treatment of
such Claim or Equity Interest, thereby satisfying section
1123(a)(4) of the Bankruptcy Code.
V. Implementation of the Plan of Reorganization (11 U.S.C.
Section 1123(a)(5)). Section 5 of the Plan of Reorganization
provides for adequate means for implementation of the Plan of
Reorganization with respect to each Debtor, thereby satisfying
section 1123(a)(5) of the Bankruptcy Code. Specifically, the
Plan of Reorganization and the various documents and
agreements set forth in the Plan Supplement provide adequate
and proper means for the implementation of the Plan of
Reorganization, including (i) substantive consolidation of the
Ltd. Debtors, the Orion Debtors, the SpaceCom Debtors and the
SS/L Debtors, respectively, pursuant to section 105(a) of the
Bankruptcy Code, effective as of the Effective Date, for all
purposes related to the Plan of Reorganization, including,
without limitation, for purposes of voting, confirmation and
distribution, (ii) effectuation of the Restructuring
Transactions, including the transfer of certain assets in
connection therewith and the treatment of Debtor Intercompany
Claims, including the reduction and discharge of such claims
owed by Ltd. to Loral Satellite, Inc. (or its successor) and
SpaceCom in accordance with the Restructuring Transactions,
(iii) the Rights Offering, (iv) the issuance of the New Loral
Common Stock, the New Skynet Preferred Stock and the New
Skynet Notes and (v) the deemed automatic cancellation of the
promissory notes, share certificates for the existing common
stock of Loral Ltd., share certificates for the existing
preferred stock of Loral Ltd., Ltd. Notes, Orion 10% Notes,
Orion Stub Notes, the Indentures and other instruments
evidencing any Claims or Equity Interests, provided, however,
that the Ltd. Notes, Orion 10% Notes, Orion Stub Notes and
Indentures shall remain in effect solely for the purposes of
(a) allowing the holders of Note Claims to receive their
distributions under the Plan of Reorganization, (b) allowing
the Indenture Trustee to make distributions on account of the
Ltd. Notes, Orion 10% Notes and Orion Stub Notes and (c)
permitting each Indenture Trustee to assert its Charging Lien
against such distributions for payment of the Indenture
Trustee Fees.
W. Nonvoting Equity Securities/Allocation of Voting Power (11
U.S.C. Section 1123(a)(6)). Section 10.3 of the Plan of
Reorganization provides that the New Loral Certificate of
Incorporation, the New Skynet Certificate of Incorporation and
the Reorganized Subsidiary Debtors' Certificates of
Incorporation shall contain provisions necessary to prohibit
the
issuance of nonvoting equity securities, thereby satisfying
section 1123(a)(6) of the Bankruptcy Code.
X. Designation of Directors and Officers (11 U.S.C. Section
1123(a)(7)). Section 10 of the Plan of Reorganization sets
forth the procedures for the selection of directors and
officers of the Reorganized Debtors that are consistent with
the interests of creditors and equity security holders and
public policy. On July 1, 2005, the Debtors timely filed with
the Bankruptcy Court the List of Directors and Officers for
the Reorganized Debtors in Connection with the Debtors' Fourth
Amended Joint Plan Under Chapter 11 of the Bankruptcy Code (as
amended on July 10, 2005, the "List of Directors and
Officers"), which discloses, among other things, the names of
the members of the initial New Loral Board, the initial New
Skynet Board, the initial New SS/L Board, the initial
Reorganized Subsidiary Debtors' Boards and the officers for
the Reorganized Debtors. Section 1123(a)(7) of the Bankruptcy
Code has been satisfied.
Y. Additional Plan Provisions (11 U.S.C. Section 1123(b)). The
provisions of the Plan of Reorganization are appropriate and
consistent with the applicable provisions of the Bankruptcy
Code, thereby satisfying section 1123(b) of the Bankruptcy
Code.
i. Impairment/Unimpairment of Any Class of Claims or
Interests (Section 1123(b)(1)). Pursuant to
Section 3.1 of the Plan of Reorganization, (i)
Ltd. Class 4 (Ltd. General
Unsecured Claims), Ltd. Class 5 (Ltd. Preferred
Stock Interests), Ltd. Class 6 (Ltd. Equity
Interests), Ltd. Class 7 (Securities Litigation
Claims), Orion Class 4 (Orion General Unsecured
Claims) and SpaceCom Class 2 (Secured Tax Claims
against the SpaceCom Debtors) are impaired; and
(ii) Ltd. Class 1 (Other Priority Claims against
the Ltd. Debtors), Ltd. Class 2 (Secured Tax
Claims against the Ltd. Debtors), Ltd. Class 3
(Secured Claim against the Ltd. Debtors), Orion
Class 1 (Other Priority Claims against the Orion
Debtors), Orion Class 2 (Secured Tax Claims
against the Orion Debtors), Orion Class 3 (Secured
Claims against the Orion Debtors), Orion Class 5
(Orion Equity Interests), SpaceCom Class 1 (Other
Priority Claims against the SpaceCom Debtors),
SpaceCom Class 3 (Secured Claims against the
SpaceCom Debtors), SpaceCom Class 4 (SpaceCom
General Unsecured Claims), SpaceCom Class 5
(SpaceCom Equity Interests), SS/L Class 1 (Other
Priority Claims against the SS/L Debtors), SS/L
Class 2 (Secured Tax Claims against the SS/L
Debtors), SS/L Class 3 (Secured Claims against the
SS/L Debtors), SS/L Class 4 (SS/L General
Unsecured Claims) and SS/L Class 5 (SS/L
Equity Interests) are unimpaired, as contemplated
by section 1123(b)(1) of the Bankruptcy Code.
ii. Assumption and Rejection of Executory Contracts
(11 U.S.C. Section 1123(b)(2)). Section 8.1 of the
Plan of Reorganization provides for the rejection
of the executory contracts and unexpired leases of
the Debtors as of the Effective Date, except for
any executory contract or unexpired lease (i) that
has been assumed pursuant to an order of the
Bankruptcy Court entered prior to the Effective
Date, (ii) as to which a motion for approval of
the assumption of such executory contract or
unexpired lease has been filed and served prior to
the Confirmation Date, or (iii) that is
specifically designated as an executory contract
or unexpired lease to be assumed on Schedule 8.1
to the Plan of Reorganization.
Z. The Debtors' Compliance With the Bankruptcy Code (11 U.S.C.
Section 1129(a)(2)). The Debtors have complied with the
applicable provisions of the Bankruptcy Code, except as
otherwise provided or permitted by orders of the Bankruptcy
Court. The Debtors have complied with the applicable
provisions of the Bankruptcy Code, the Bankruptcy Rules and
the Local Bankruptcy Rules for the Southern District of New
York (the "Local Rules") in transmitting the
Solicitation Packages and related documents and notices, and
in soliciting and tabulating the votes on the Plan of
Reorganization.
AA. Plan of Reorganization Proposed in Good Faith (11 U.S.C.
Section 1129(a)(3)). The Debtors have proposed the Plan of
Reorganization in good faith and not by any means forbidden by
law, thereby satisfying section 1129(a)(3) of the Bankruptcy
Code. The Debtors' good faith is evident from the facts and
record of these Reorganization Cases, the Disclosure
Statement, and the record of the Confirmation Hearing and
other proceedings held in these Reorganization Cases. The Plan
of Reorganization was proposed with the legitimate and honest
purpose of maximizing the value of the Debtors' estates and to
effectuate a successful reorganization of the Debtors. The
Plan of Reorganization was negotiated at arms'-length among
representatives of the Debtors, the Creditors' Committee, the
Backstop Purchasers and the ad hoc committee of certain trade
creditors of Space Systems/Loral, Inc. and Loral SpaceCom
Corporation. The Plan of Reorganization is supported by the
Creditors' Committee and the Backstop Purchasers. Further, the
Plan of Reorganization's classification, indemnification,
exculpation, release and injunction provisions have been
negotiated in good faith and at arms'-length, are each
necessary for the Debtors' successful reorganization and are
consistent with sections 105, 1122, 1123(b)(3)(A), 1129 and
1142 of the Bankruptcy Code. All Objections based on an
alleged lack of good
faith are overruled based on the Decision and the record of
the Confirmation Hearing.
BB. Payment for Services or Costs and Expenses (11 U.S.C. Section
1129(a)(4)). Any payment made or to be made by the Debtors, or
by a person issuing securities or acquiring property under the
Plan of Reorganization, for services or for costs and expenses
in connection with the Reorganization Cases, or in connection
with the Plan of Reorganization and incident to the
Reorganization Cases, has been approved by, or is subject to
the approval of, this Court as reasonable, thereby satisfying
section 1129(a)(4) of the Bankruptcy Code.
CC. Directors, Officers and Insiders (11 U.S.C. Section
1129(a)(5)). The Debtors have complied with section 1129(a)(5)
of the Bankruptcy Code. The identity and affiliations of the
persons proposed to serve as the initial directors and
officers of the Reorganized Debtors after confirmation of the
Plan of Reorganization have been fully disclosed, and the
appointment to, or continuance in, such offices of such
persons is consistent with the interests of holders of Claims
against and Equity Interests in the Debtors and with public
policy. The identity of any insider that will be employed or
retained by the Reorganized Debtors and the nature of such
insider's compensation have also been fully disclosed.
DD. No Rate Changes (11 U.S.C. Section 1129(a)(6)). The Plan of
Reorganization does not provide for rate changes subject to
the
jurisdiction of any governmental regulatory agency by the
Reorganized Debtors. Accordingly, section 1129(a)(6) of the
Bankruptcy Code is inapplicable to these Reorganization Cases.
EE. Best Interests of Creditors (11 U.S.C. Section 1129(a)(7)).
The Plan of Reorganization satisfies section 1129(a)(7) of the
Bankruptcy Code. There was no objection to the Plan of
Reorganization on this basis. The liquidation analyses
provided in the Disclosure Statement, as supported by evidence
proffered, adduced and/or presented at the Confirmation
Hearing, including the claims that would arise upon the
termination of the Debtors' businesses and the liquidation of
their assets, (i) are persuasive and credible, (ii) have not
been controverted by other evidence and (iii) establish that
each holder of an impaired Claim or Equity Interest either has
accepted the Plan of Reorganization or will receive or retain
under the Plan of Reorganization, on account of such Claim or
Equity Interest, property of a value, as of the Effective
Date, that is not less than the amount that such holder would
receive or retain if the Ltd. Debtors, the Orion Debtors, the
SpaceCom Debtors and the SS/L Debtors, as applicable, were
liquidated under chapter 7 of the Bankruptcy Code on such
date.
FF. Acceptance by Certain Classes (11 U.S.C. Section 1129(a)(8)).
Ltd. Class 1 (Other Priority Claims against the Ltd. Debtors),
Ltd. Class 2 (Secured Tax Claims against the Ltd. Debtors),
Ltd. Class 3 (Secured Claims against the Ltd. Debtors), Orion
Class 1 (Other Priority Claims against
the Orion Debtors), Orion Class 2 (Secured Tax Claims against
the Orion Debtors), Orion Class 3 (Secured Claims against the
Orion Debtors), Orion Class 5 (Orion Equity Interests),
SpaceCom Class 1 (Other Priority Claims against the SpaceCom
Debtors), SpaceCom Class 3 (Secured Claims against the
SpaceCom Debtors), SpaceCom Class 4 (SpaceCom General
Unsecured Claims), SpaceCom Class 5 (SpaceCom Equity
Interests), SS/L Class 1 (Other Priority Claims against the
SS/L Debtors), SS/L Class 2 (Secured Tax Claims against the
SS/L Debtors), SS/L Class 3 (Secured Claims against the SS/L
Debtors), SS/L Class 4 (SS/L General Unsecured Claims) and
SS/L Class 5 (SS/L Equity Interests) are Classes of unimpaired
Claims and Equity Interests, as applicable, that are
conclusively presumed to have accepted the Plan of
Reorganization in accordance with section 1126(f) of the
Bankruptcy Code. Ltd Class 4 (Ltd. General Unsecured Claims),
Orion Class 4 (Orion General Unsecured Claims), and SpaceCom
Class 2 (Secured Tax Claims against the SpaceCom Debtors) have
voted to accept the Plan of Reorganization in accordance with
sections 1126(b) and (c) of the Bankruptcy Code. Ltd. Class 5
(Ltd. Preferred Stock Interests), Ltd. Class 6 (Ltd. Equity
Interest) and Ltd. Class 7 (Securities Litigation Claims) are
impaired by the Plan of Reorganization and are not entitled to
receive or retain any property under the Plan of
Reorganization and, therefore, are deemed to have rejected the
Plan of Reorganization pursuant to section
1126(g) of the Bankruptcy Code. Although section 1129(a)(8) of
the Bankruptcy Code is not satisfied as a result of the deemed
rejection of Ltd. Class 5, Ltd. Class 6 and Ltd. Class 7, the
Plan of Reorganization may nevertheless be confirmed because
the Plan of Reorganization satisfies section 1129(b) of the
Bankruptcy Code with respect to Ltd. Class 5, Ltd. Class 6 and
Ltd. Class 7.
GG. Treatment of Administrative Expense Claims, Tax Claims and
Other Priority Claims (11 U.S.C. Section 1129(a)(9)). The
treatment of Allowed Administrative Expense Claims pursuant to
Sections 2.1(a) - (d) of the Plan of Reorganization, and
Priority Non-Tax Claims pursuant to Sections 4.1, 4.8, 4.13
and 4.18 of the Plan of Reorganization, satisfies the
requirements of sections 1129(a)(9)(A) and (B) of the
Bankruptcy Code. The treatment of Priority Tax Claims pursuant
to Section 2.4 of the Plan of Reorganization satisfies the
requirements of section 1129(a)(9)(C) of the Bankruptcy Code.
HH. Acceptance By Impaired Class of Claims (11 U.S.C. Section
1129(a)(10)). At least one Class of impaired Claims against
the Ltd. Debtors, the Orion Debtors, and the SpaceCom Debtors,
respectively, has accepted the Plan of Reorganization,
determined without including any acceptance of the Plan of
Reorganization by insiders. Specifically, Ltd Class 4 (Ltd.
General Unsecured Claims), Orion Class 4 (Orion General
Unsecured Claims) and SpaceCom Class 2 (Secured Tax Claims
against the SpaceCom Debtors) voted to accept the Plan of
Reorganization by the requisite majorities mandated under
section 1126 of the Bankruptcy Code, determined without
including any acceptance of the Plan of Reorganization by any
insider, thereby satisfying the requirements of section
1129(a)(10) of the Bankruptcy Code. Additionally, as there is
no impaired Class of Claims against the SS/L Debtors, section
1129(a)(10) of the Bankruptcy Code is inapplicable thereto.
II. Feasibility (11 U.S.C. Section 1129(a)(11)). The evidence
proffered, adduced and/or presented at the Confirmation
Hearing with respect to the showing required by section
1129(a)(11) of the Bankruptcy Code (i) is persuasive and
credible, (ii) has not been controverted by other evidence and
(iii) establishes that the Plan of Reorganization is feasible
and that there is a reasonable prospect of the Reorganized
Debtors being able to meet their financial obligations under
the Plan of Reorganization and in the ordinary course of their
businesses, and that confirmation of the Plan of
Reorganization is not likely to be followed by the liquidation
or the need for further financial reorganization of the
Reorganized Debtors, thereby satisfying the requirements of
section 1129(a)(11) of the Bankruptcy Code.
JJ. Payment of Fees (11 U.S.C. Section 1129(a)(12)). Pursuant to
Section 14.6 of the Plan of Reorganization, on the Effective
Date, and thereafter as may be required, the Debtors shall pay
all fees payable pursuant to section 1930, chapter 123, of
title 28 of the United States Code,
thereby satisfying the requirements of section 1129(a)(12) of
the Bankruptcy Code.
KK. Continuation of Retiree Benefits (11 U.S.C. Section
1129(a)(13)). Section 8.10 of the Plan of Reorganization
provides that the Reorganized Debtors shall continue to pay
all retiree benefits of the Debtors for the duration of the
period for which the Debtors had obligated themselves to
provide such benefits and subject to the right of the
Reorganized Debtors to modify or terminate such retiree
benefits in accordance with the terms thereof. Accordingly,
the Plan of Reorganization satisfies the requirements of
section 1129(a)(13) of the Bankruptcy Code.
LL. No Unfair Discrimination; Fair and Equitable (11 U.S.C.
Section 1129(b)). Ltd. Class 5 (Ltd. Preferred Stock
Interests), Ltd. Class 6 (Ltd. Equity Interests) and Ltd.
Class 7 (Securities Litigation Claims) (collectively, the
"Rejecting Classes") are deemed to have rejected the Plan of
Reorganization. Based upon the evidence proffered, adduced
and/or presented at the Confirmation Hearing, the Plan of
Reorganization does not discriminate unfairly and is fair and
equitable with respect to the Rejecting Classes, as required
by sections 1129(b)(1) and (b)(2) of the Bankruptcy Code,
because there is no holder of any interest that is junior to
any of the Rejecting Classes that is receiving or retaining
any property under the Plan of Reorganization on account of
such junior interest, and the holders of Claims in Classes
senior to the Rejecting
Classes are receiving distributions the value of which, on the
Effective Date, is less than 100% of the allowed amount of
their Claims. Thus, the Plan of Reorganization may be
confirmed notwithstanding the deemed rejection by the
Rejecting Classes, thereby satisfying the requirements of
sections 1129(b)(1) and (b)(2) of the Bankruptcy Code.
MM. Principal Purpose of the Plan of Reorganization (11 U.S.C.
Section 1129(d)). The principal purpose of the Plan of
Reorganization is not the avoidance of taxes or the avoidance
of the application of Section 5 of the Securities Act of 1933,
as amended, thereby satisfying the requirements of section
1129(d) of the Bankruptcy Code.
NN. Good Faith Solicitation (11 U.S.C. Section 1125(e)). Based on
the record before the Bankruptcy Court in these Reorganization
Cases, (i) the Debtors are deemed to have solicited
acceptances of the Plan of Reorganization in good faith and in
compliance with the applicable provisions of the Bankruptcy
Code, including without limitation, sections 1125(a) and (e)
of the Bankruptcy Code, and any applicable non-bankruptcy law,
rule, or regulation governing the adequacy of disclosure in
connection with such solicitation and (ii) based on the
foregoing, the Debtors, the members of the Creditors'
Committee, the Backstop Purchasers and each of their
respective affiliates, agents, directors, officers, employees,
advisors and attorneys shall be deemed to have participated in
good faith and in compliance with the
applicable provisions of the Bankruptcy Code in the offer and
issuance of any securities under the Plan of Reorganization,
and therefore are not, and on account of such offer, issuance
and solicitation will not be, liable at any time for any
violation of any applicable law, rule, or regulation governing
the solicitation of acceptances or rejections of the Plan of
Reorganization or the offer, issuance, sale or purchase of any
securities under the Plan of Reorganization.
OO. Exculpation, Injunction and Releases. The Bankruptcy Court has
jurisdiction under sections 1334(a) and (b) of title 28 of the
United States Code to approve the exculpation, injunctions and
releases set forth in Sections 11.8, 11.5 and 11.9 of the Plan
of Reorganization, respectively. Section 105(a) of the
Bankruptcy Code permits issuance of the injunctions and
approval of the unopposed releases set forth in Sections 11.5
and 11.9 of the Plan of Reorganization, respectively, if, as
has been established here, such provisions (i) are essential
to the formulation and implementation of the Plan of
Reorganization, as provided in section 1123 of the Bankruptcy
Code, (ii) confer substantial benefits on the Debtors'
estates, (iii) are fair and reasonable and (iv) are in the
best interests of the Debtors, their estates and holders of
Claims and Equity Interests. Further, the exculpation
provision in the Plan of Reorganization does not relieve any
party of liability for an act or omission to the extent such
act or omission is determined by a Final Order to have
constituted willful misconduct or
gross negligence or the other exceptions set forth therein.
Based upon the record of the Reorganization Cases and the
evidence proffered, adduced and/or presented at the
Confirmation Hearing, this Court finds that the exculpation,
injunction and releases set forth in Section 11 of the Plan of
Reorganization are consistent with the Bankruptcy Code and
applicable law.
PP. Satisfaction of Confirmation Requirements. Based upon the
foregoing, the Plan of Reorganization satisfies the
requirements for confirmation set forth in section 1129 of the
Bankruptcy Code.
QQ. Assumption of Executory Contracts and Unexpired Leases. The
Debtors have satisfied the provisions of section 365 of the
Bankruptcy Code with respect to the assumption and/or the
assumption and assignment of executory contracts and unexpired
leases pursuant to the Plan of Reorganization.
RR. Transfers by Debtors. The revesting, on the Effective Date, of
the property of the Debtors' estates: (a) vests the
appropriate Reorganized Debtors or their successors or
assigns, as the case may be, with good title to such property,
free and clear of all Claims and Equity Interests, except as
expressly provided in the Plan of Reorganization or this
Confirmation Order; and (b) does not constitute a voidable
transfer under the Bankruptcy Code or applicable nonbankruptcy
law.
SS. Retention of Jurisdiction. On and after the Effective Date,
the Bankruptcy Court shall retain jurisdiction over all
matters, including,
but not limited to, those matters set forth in Sections 8 and
13 of the Plan of Reorganization, arising in and under, and
related to, the Reorganization Cases for, among other things,
the purposes set forth in Sections 8.1 and 13 of the Plan of
Reorganization and section 1142 of the Bankruptcy Code, as
well as any (i) motions filed prior to the Effective Date
requiring authorization to use, sell, or lease assets outside
the ordinary course of business pursuant to section 363 of the
Bankruptcy Code and (ii) motions to assume, assume and assign,
or reject executory contracts or unexpired leases pursuant to
Sections 8.1 and 8.5 of the Plan of Reorganization.
CONCLUSIONS OF LAW
1. Conclusions of Law. The conclusions of law set forth herein
and by the Bankruptcy Court at the conclusion of the
Confirmation Hearing constitute the Bankruptcy Court's
conclusions of law pursuant to Rule 52 of the Federal Rules of
Civil Procedure, as made applicable herein by Bankruptcy Rules
7052 and 9014. To the extent any of the following conclusions
of law constitute findings of fact, they are adopted as such.
2. Confirmation. The Plan of Reorganization and each of its
provisions shall be, and hereby are, CONFIRMED under section
1129 of the Bankruptcy Code.
3. Solicitation and Notice. Notice of the Confirmation Hearing
complied with the terms of the Disclosure Statement Order, was
appropriate and
satisfactory based upon the circumstances of the Debtors'
Reorganization Cases, and was in compliance with the
provisions of the Bankruptcy Code, the Bankruptcy Rules and
the Local Rules. The solicitation of votes on the Plan of
Reorganization complied with the solicitation procedures in
the Disclosure Statement Order, was appropriate and
satisfactory based upon the circumstances of the Debtors'
Reorganization Cases, and was in compliance with the
provisions of the Bankruptcy Code, the Bankruptcy Rules and
the Local Rules. Notice of the Plan Supplement, and all
related documents, was appropriate and satisfactory based upon
the circumstances of the Debtors' Reorganization Cases, and
was in compliance with the provisions of the Bankruptcy Code,
the Bankruptcy Rules and the Local Rules.
4. Objections. All parties have had a full and fair opportunity
to litigate all issues raised by the Objections, or which
might have been raised, and the Objections have been fully and
fairly litigated. All Objections, responses, statements and
comments in opposition to the Plan of Reorganization, other
than those withdrawn with prejudice in their entirety prior to
the Confirmation Hearing or otherwise resolved on the record
of the Confirmation Hearing and/or herein, shall be, and
hereby are, overruled for the reasons stated on the record. As
noted on the record of the Confirmation Hearing, the ERISA
Objection is withdrawn as an objection to confirmation of the
Plan of
Reorganization, and the issues raised therein will be
addressed in the claims resolution process with the rights of
all parties reserved with respect thereto.
5. Binding Effect. Except as otherwise provided in section
1141(d)(3) of the Bankruptcy Code, upon entry of this
Confirmation Order and subject to the occurrence of the
Effective Date, the provisions of the Plan of Reorganization
and the Plan Supplement shall bind (i) any holder of a Claim
against or Equity Interest in the Debtors and their respective
successors and assigns, whether or not such Claim or Equity
Interest of such holder is impaired under the Plan of
Reorganization and whether or not such holder has accepted the
Plan of Reorganization, (ii) any and all non-Debtor parties to
assumed executory contracts and unexpired leases with any of
the Debtors, (iii) the Objectors, (iv) every other party in
interest in the Reorganization Cases and (v) all parties
receiving property under the Plan of Reorganization and the
Plan Supplement documents, and their respective heirs,
executors, administrators, successors, or assigns.
6. Vesting of Assets (11 U.S.C. Section 1141(b), (c)). Pursuant
to Section 11.1 of the Plan of Reorganization, upon the
Effective Date, pursuant to sections 1141(b) and (c) of the
Bankruptcy Code, all property of the Debtors shall vest in
each of the Reorganized Debtors free and clear of all Claims,
Liens, encumbrances, charges and other interests, except as
provided in the Plan of Reorganization. Upon the Effective
Date, the
Reorganized Debtors may operate their businesses and may use,
acquire and dispose of property free of any restrictions of
the Bankruptcy Code or the Bankruptcy Rules and in all
respects as if there were no pending case under any chapter or
provision of the Bankruptcy Code, including any and all
actions to be taken to effectuate the Restructuring
Transactions.
7. Objections to Claims. The Reorganized Debtors shall be
entitled to object to all Claims. Any objections to Claims
shall be served and filed on or before the later of (i) one
hundred twenty (120) days after the Effective Date, as such
time may be extended by order of the Bankruptcy Court, and
(ii) such later date as may be fixed by the Bankruptcy Court,
whether fixed before or after the date specified in clause (i)
above.
8. Disputed Claims. If any portion of a Claim is disputed, then
no payment or distribution shall be made on account of the
portion of such Claim that is disputed unless and until such
Disputed Claim becomes an Allowed Claim. On the next
Distribution Date after a Disputed Claim becomes an Allowed
Claim, the Disbursing Agent shall distribute to the holder of
such Claim, the property distributable with respect to such
Claim in accordance with Sections 4.4, 4.11, 4.16 and 4.21 of
the Plan of Reorganization, as applicable, and any net
earnings attributable thereto. To the extent that all or a
portion of a Disputed Claim is disallowed, the holder of such
Claim shall not
receive any distribution on account of the portion of such
Claim that is disallowed, and any property withheld pending
the resolution of such Claim shall be reallocated in
accordance with Sections 4.4, 4.11, 4.16 and 4.21 of the Plan
of Reorganization, as applicable, together with any net
earnings attributable thereto.
9. Assumption or Rejection of Executory Contracts and Unexpired
Leases (11 U.S.C. Section 1123(b)(2)). Pursuant to Section 8.1
of the Plan of Reorganization, as of the Effective Date all
executory contracts and unexpired leases that exist between
the Debtors and any person or entity shall be deemed rejected
by the Debtors, except for any executory contract or unexpired
lease (i) that has been assumed pursuant to an order of the
Bankruptcy Court entered prior to the Effective Date, (ii) as
to which a motion for approval of the assumption of such
executory contract or unexpired lease has been filed and
served prior to the Confirmation Date, or (iii) that is
specifically designated on Schedule 8.1 to the Plan of
Reorganization as an executory contract or unexpired lease to
be assumed. The parties to such executory contracts or
unexpired leases to be assumed or assumed and assigned by the
Debtors shall have twenty (20) days from the date of service
of the Assumption Notice to file and serve any objection to
the assumption by the Debtors of such executory contracts or
unexpired leases and/or the proposed cure amounts listed by
the Debtors. If there are any objections filed, the Bankruptcy
Court shall
hold a hearing on a date to be set by the Bankruptcy Court.
Notwithstanding Section 8.1 of the Plan of Reorganization, the
Debtors shall retain their rights (after giving notice to the
Creditors' Committee) to reject any of their executory
contracts or unexpired leases that are subject to a dispute
concerning amounts necessary to cure any defaults.
Notwithstanding any omission from Schedule 8.1 to the Plan of
Reorganization, all non-disclosure agreements to which any of
the Debtors is a counterparty shall be deemed assumed upon
entry of the confirmation order expressly conditioned upon and
subject to the occurrence of the Effective Date and the cure
costs in connection with each such agreement shall be fixed at
$0.00.
10. Bar Date for Filing Proofs of Claim Relating to Executory
Contracts and Unexpired Leases Rejected Pursuant to the Plan
of Reorganization. In the event that the rejection of an
executory contract or unexpired lease by the Debtors pursuant
to the Plan of Reorganization results in damages to the other
party or parties to such contract or lease, a Claim for such
damages, if not heretofore evidenced by a filed proof of
claim, shall be forever barred and shall not be enforceable
against the Debtors or the Reorganized Debtors, or their
properties or interests in property as agents, successors, or
assigns, unless a proof of claim is filed with the Bankruptcy
Court and served upon the attorneys for the Debtors on or
before the date that is thirty (30) days after the later of
(i) the date of service of notice of the
Confirmation Date, (ii) notice of modification to Schedule 8.1
to the Plan of Reorganization, or (iii) the date of service of
notice of such later rejection date that occurs as a result of
a dispute concerning amounts necessary to cure any defaults.
11. General Authorization. Each of the officers of New Loral, New
Skynet, New SS/L and the other Reorganized Debtors is
authorized, in accordance with his or her authority under the
resolutions of the applicable Board of Directors, to execute,
deliver, file, or record such contracts, instruments,
releases, indentures and other agreements or documents and
take such actions as may be necessary or appropriate to
effectuate and further evidence the terms and conditions of
the Plan of Reorganization.
12. Substantive Consolidation. Entry of this Confirmation Order
shall constitute the approval, pursuant to section 105(a) of
the Bankruptcy Code, effective as of the Effective Date, of
the substantive consolidation of the Ltd. Debtors, the Orion
Debtors, the SpaceCom Debtors and the SS/L Debtors,
respectively, for all purposes related to the Plan of
Reorganization, including, without limitation, for purposes of
voting, confirmation and distribution, and subject to the
terms outlined in Section 5.1 of the Plan of Reorganization.
The substantive consolidation effected pursuant to Section 5.1
of the Plan of Reorganization shall not (other than for
purposes related to funding distributions under the Plan of
Reorganization and as set forth in
Section 5.1 of the Plan of Reorganization) affect: (i) the
legal and organizational structure of the Debtors; (ii) pre
and post-Commencement Date guarantees, Liens and security
interests that are required to be maintained (A) in connection
with executory contracts or unexpired leases that were entered
into during the Reorganization Cases or that have been or will
be assumed, or (B) pursuant to the Plan of Reorganization; or
(iii) distributions out of any insurance policies or proceeds
of such policies.
13. Subordination of Securities Litigation Claims. Subject to
paragraph 4 of this Confirmation Order as it applies to the
ERISA Objection, Entry of this Confirmation Order shall
constitute the approval, pursuant to section 510(b) of the
Bankruptcy Code, of the subordination of the Securities
Litigation Claims classified in Ltd. Class 7 (Securities
Litigation Claims); each holder of an Allowed Securities
Litigation Claim shall not receive or retain any interest or
property under the Plan of Reorganization on account of such
Securities Litigation Claim.
14. Plan Supplement. The documents contained in the Plan
Supplement and any amendments, modifications and supplements
thereto permitted by the Plan of Reorganization or this
Confirmation Order, and all documents and agreements
introduced into evidence by the Debtors at the Confirmation
Hearing (including all exhibits and attachments thereto and
documents referenced therein), are authorized and approved,
including, but not limited to the (i) draft New Skynet Notes
Indenture, (ii) Form of New Skynet Note, (iii) Registration
Rights Agreement (New Loral Common Stock, New Skynet Preferred
Stock and New Skynet Notes), (iv) Subscription Forms for
Rights Offering, (v) New Loral Certificate of Incorporation,
(vi) New Loral Bylaws, (vii) New Skynet Certificate of
Incorporation, (viii) Certificate of Designation of New Skynet
Preferred Stock, (ix) New Skynet Bylaws, (x) New SS/L
Certificate of Incorporation, (xi) New SS/L Bylaws, (xii)
Loral SpaceCom Corporation Certificate of Incorporation,
(xiii) Loral SpaceCom Corporation Bylaws, (xiv) Loral Space &
Communications Holdings Corporation (f/k/a Loral Space &
Communications Corporation) Certificate of Incorporation, (xv)
Loral Space & Communications Holdings Corporation (f/k/a Loral
Space & Communications Corporation) Bylaws, (xvi) Certificate
of Amendment to Certificate of Incorporation of (a) Loral
Space & Communications Corporation (n/k/a Loral Space &
Communications Holdings Corporation), (b) Loral Communications
Services, Inc., (c) Loral CyberStar Services, Inc., (d) Loral
Skynet Network Services, Inc. and (e) Loral CyberStar
International, Inc., (xvii) Backstop Commitment Agreement,
(xviii) New Management Stock Plan, (xix) Form of New Loral
Employment Contract, (xx) Form of Employment Contract of
Bernard L. Schwartz, (xxi) SERP Amendment, (xxii) List of
Subsidiaries that Will Be Merged or Dissolved and Assets to Be
Transferred, (xxiii) Schedule of Executory Contracts and
Unexpired
Leases to Be Assumed Pursuant to the Plan (Schedule 8.1 to the
Plan) and (xxiv) List of Surviving Debtors Whose
Organizational Documents Are Not Being Revised. Subject to the
terms of the Plan of Reorganization, without need for further
order or authorization of this Court, with the consent of the
Creditors' Committee, the Reorganized Debtors are authorized
and empowered to make any and all modifications to any and all
documents included as part of the Plan Supplement that do not
materially modify the terms of such documents and are
consistent with the Plan of Reorganization. The Debtors are
authorized to enter into the Backstop Commitment Agreement and
to pay all fees and expenses thereunder in accordance with the
terms thereof.
15. Cancellation of Existing Securities and Agreements. Except (i)
as otherwise expressly provided in the Plan of Reorganization,
(ii) with respect to executory contracts or unexpired leases
that have been assumed by the Debtors, (iii) for purposes of
evidencing a right to distributions under the Plan of
Reorganization, and/or (iv) with respect to any Claim that is
reinstated and rendered unimpaired under the Plan of
Reorganization, on the Effective Date, the promissory notes,
share certificates for the existing common stock of Loral
Ltd., share certificates for the existing preferred stock of
Loral Ltd., Ltd. Notes, Orion 10% Notes, Orion Stub Notes,
Indentures and other instruments evidencing any Claims or
Equity Interests shall be deemed
automatically cancelled without further act or action under
any applicable agreement, law regulation, order, or rule and
the obligations of the Debtors under the agreements,
indentures and certificates of designations governing such
Claims and Equity Interests, as the case may be, shall be
discharged; provided, however, that the Ltd. Notes, Orion 10%
Notes, Orion Stub Notes and Indentures shall continue in
effect solely for the purposes of (i) allowing the holders of
Allowed Note Claims to receive their distributions under the
Plan of Reorganization, (ii) allowing the applicable Indenture
Trustee to make the distributions to be made on account of the
Ltd. Notes, Orion 10% Notes and Orion Stub Notes and (iii)
permitting each Indenture Trustee to assert its Charging Lien
against such distributions for payment of the Indenture
Trustee Fees.
16. Authorization of New Securities. Pursuant to Section 10.4 of
the Plan of Reorganization, New Loral and New Skynet, as
applicable, are authorized without further act or action under
applicable law, regulation, order, or rule, to issue (a) the
New Loral Common Stock, (b) the New Skynet Preferred Stock,
(c) the New Skynet Notes, (d) the Subscription Rights and (e)
the Options.
17. Securities Laws Exemption. To the maximum extent provided by
section 1145 of the Bankruptcy Code and applicable
nonbankruptcy law, the issuance under the Plan of
Reorganization of the New Loral Common Stock, the New Skynet
Preferred Stock, the New Skynet
Notes and the Subscription Rights shall be, and hereby is
exempt from the registration requirements of the Securities
Act of 1933, as amended, and all rules and regulations
promulgated thereunder, and any State or local law requiring
registration for the offer of sale of a security.
18. New Management Stock Plan. Entry of this Confirmation Order
constitutes the approval of the New Management Stock Plan,
which shall be and shall be deemed to be adopted by New Loral
and effective as of the Effective Date. The solicitation of
votes on the Plan of Reorganization includes and is deemed to
be a solicitation for approval of the New Management Stock
Plan by the holders of the New Loral Common Stock.
19. Payment of Statutory Fees. All fees due and payable pursuant
to section 1930 of title 28 of the United States Code, as
determined by the Bankruptcy Court shall be paid on the
Effective Date, and thereafter as may be required.
20. Exemption From Transfer Taxes. Pursuant to section 1146(c) of
the Bankruptcy Code, the issuance, transfer, or exchange of
notes or equity securities under the Plan of Reorganization,
the creation of any mortgage, deed of trust, or other security
interest, the making or assignment of any lease or sublease,
or the making or delivery of any deed or other instrument of
transfer under, in furtherance of, or in connection with the
Plan of Reorganization, including, without
limitation, any merger agreements or agreements of
consolidation, deeds, bills of sale, or assignments executed
in connection with any of the transactions contemplated under
the Plan of Reorganization, shall not be subject to any stamp,
real estate transfer, mortgage recording, or other similar
tax. All sale transactions consummated by the Debtors and
approved by the Bankruptcy Court on and after the Commencement
Date through and including the Effective Date, including,
without limitation, the transfers effectuated under the Plan
of Reorganization, the Restructuring Transactions, the sale by
the Debtors of owned property pursuant to section 363(b) of
the Bankruptcy Code, and the assumption, assignment and sale
by the Debtors of unexpired leases of non-residential real
property pursuant to section 365(a) of the Bankruptcy Code,
shall be deemed to have been made under, in furtherance of, or
in connection with the Plan of Reorganization and, thus, shall
not be subject to any stamp, real estate transfer, mortgage
recording, or other similar tax.
21. Date of Distributions. Pursuant to Section 6.4 of the Plan of
Reorganization, except as otherwise provided in the Plan of
Reorganization, any distributions and deliveries to be made
under the Plan of Reorganization shall occur on the Effective
Date or as soon thereafter as is practicable. In the event
that any payment or act under the Plan of Reorganization is
required to be made or performed on a date that is not a
Business Day, then the making of such payment or
the performance of such act may be completed on or as soon as
reasonably practicable after the next succeeding Business Day,
but shall be deemed to have been completed as of the required
date.
22. Allocation of Distributions. To the extent that any Allowed
Claim entitled to a distribution under the Plan of
Reorganization consists of indebtedness and accrued but unpaid
interest thereon, such distribution shall be allocated first
to the principal amount of the Claim (as determined for
federal income tax purposes) and then, to the extent the
consideration exceeds the principal amount of the Claim, to
accrued but unpaid interest.
23. Final Fee Applications. Notwithstanding Section 2.2 of the
Plan of Reorganization, any and all entities seeking an award
by the Bankruptcy Court of compensation for services rendered
or reimbursement of expenses incurred through and including
the Confirmation Date, including any such applications under
sections 503(b)(2), 503(b)(3), 503(b)(4), or 503(b)(5) of the
Bankruptcy Code, (i) shall file their respective final
applications for allowance of compensation for services
rendered and reimbursement of expenses incurred by the date
that is thirty (30) days after the Effective Date and (ii)
shall be paid in full in such amounts as are allowed by this
Court (A) five (5) Business Days after the date upon which the
order relating to any such Administrative Expense Claim is
entered or (B) upon such other terms as may be mutually agreed
upon between the holder of
such an Administrative Expense Claim and the Debtors, or, if
on or after the Effective Date, the Reorganized Debtors. The
Debtors and the Reorganized Debtors, as applicable, are
authorized to pay compensation for services rendered or
reimbursement of expenses incurred after the Confirmation Date
and until the Effective Date in the ordinary course of
business and without the need for Bankruptcy Court approval.
In accordance with Section 2.2 of the Plan of Reorganization,
the Debtors will support (and the Creditor's Committee will
not object to) applications for the reimbursement of
reasonable fees and expenses (x) pursuant to section 503(b) of
the Bankruptcy Code of attorneys for MHR Fund Management LLC
and its affiliates, Contrarian Capital Trade Claims, LP and
Angelo, Gordon & Co., L.P. and (y) for MHR Fund Management LLC
and its affiliates, incurred in connection with the
preparation and filing, including filing fees, of submissions
under the Hart-Scott-Rodino Antitrust Improvement Act of 1976
or fees and expenses associated with other regulatory filings.
24. Discharge of Debtors. Pursuant to Section 11.4 of the Plan of
Reorganization, upon the Effective Date and in consideration
of the distributions to be made under the Plan of
Reorganization, except as otherwise expressly provided in the
Plan of Reorganization, each holder (as well as any trustees
and agents on behalf of each holder) of a Claim or Equity
Interest and any affiliate of such holder shall be
deemed to have forever waived, released and discharged the
Debtors, to the fullest extent permitted by section 1141 of
the Bankruptcy Code, of and from any and all Claims, Equity
Interests, rights and liabilities that arose prior to the
Effective Date. Upon the Effective Date, all such persons
shall be forever precluded and enjoined, pursuant to section
524 of the Bankruptcy Code, from prosecuting or asserting any
such discharged Claim against or terminated Equity Interest in
the Debtors.
25. Exculpation. Pursuant to Section 11.8 of the Plan of
Reorganization, notwithstanding anything contained therein to
the contrary, as of the Effective Date, none of (i) the
Debtors and the Debtors' officers, directors and employees,
(ii) the Creditors' Committee and any subcommittee thereof,
(iii) the Equity Committee, (iv) the Agent, (v) the Indenture
Trustees, (vi) the JPLs, (vii) the accountants, financial
advisors, investment bankers, agents and attorneys for the
Debtors, (viii) the Backstop Purchasers and their affiliates
and (ix) the directors, officers, partners, members, agents,
representatives, accountants, financial advisors, investment
bankers, or attorneys for any of the persons or entities
described in (ii), (iii), (iv), (v), (vi) and (viii) above
(but solely in their capacities as such) shall have or incur
any liability for any claim, cause of action, or other
assertion of liability for any action taken or omitted to be
taken since the Commencement Date in connection with, or
arising out of, the Reorganization Cases, the
formulation, dissemination, confirmation, consummation, or
administration of the Plan of Reorganization, property to be
distributed under the Plan of Reorganization, or any other act
or omission in connection with the Reorganization Cases, the
provisional liquidation of the Bermudian Debtors, the Plan of
Reorganization, the Disclosure Statement, or any contract,
instrument, document or other agreement related thereto;
provided, however, that the foregoing shall not affect the
liability of any person that otherwise would result from any
such act or omission to the extent such act or omission is
determined by a Final Order to have constituted willful
misconduct or gross negligence; and provided, further that
such exculpation shall not be more broad than section 11.12 of
the Plan of Reorganization, as set forth in Paragraph J.(a) of
this Confirmation Order.
26. Releases of Representatives. Pursuant to Section 11.9 of the
Plan of Reorganization, effective as of the Confirmation Date
but subject to the occurrence of the Effective Date, and in
consideration of: (a) the services provided by the present and
former directors, officers, employees, affiliates, agents,
financial advisors, attorneys and representatives of the
Debtors to the Debtors who acted in such capacities after the
Commencement Date; (b) the services of the Creditors'
Committee and the Backstop Purchasers and their affiliates;
(c) the services of the Equity Committee; (d) the services of
the Agent; (e) the services of each Indenture Trustee; and (f)
the services of the
JPLs, and their respective professionals in connection with
the Reorganization Cases and the provisional liquidations of
the Bermudian Debtors, (x) the Debtors and the Reorganized
Debtors; (y) each holder of a Claim or Equity Interest that
votes to accept the Plan of Reorganization (or is deemed to
accept the Plan of Reorganization); and (z) to the fullest
extent permissible under applicable law, as such law may be
extended or integrated after the Effective Date, each holder
of a Claim or Equity Interest that does not vote to accept the
Plan of Reorganization, shall release unconditionally and
forever each present or former director, officer, employee,
agent, financial advisor, attorney and representative (and
their respective affiliates) of the Debtors who acted in such
capacity after the Commencement Date, the Creditors'
Committee, each member of the Creditors' Committee, the
Backstop Purchasers, the Equity Committee, each member of the
Equity Committee, the Agent, the Indenture Trustees, the JPLs,
and each of their respective members, officers, directors,
agents, financial advisors, attorneys, employees, equity
holders, parent corporations, subsidiaries, partners,
affiliates and representatives from any and all claims or
causes of action whatsoever in connection with, related to, or
arising out of the Reorganization Cases, the pursuit of
confirmation of the Plan of Reorganization, the consummation
thereof, the administration thereof, or the property to be
distributed thereunder, and the provisional liquidation of the
Bermudian Debtors; provided,
that the foregoing shall not operate as a waiver of or release
from any causes of action arising out of the willful
misconduct or gross negligence of any such person or entity;
and provided, further that such release shall not be more
broad than section 11.12 of the Plan of Reorganization, as set
forth in Paragraph J.(a) of this Confirmation Order.
27. Injunction. Pursuant to Section 11.5 of the Plan of
Reorganization, except as otherwise expressly provided in the
Plan of Reorganization, all persons or entities who have held,
hold or may hold Claims or Equity Interests and all other
parties in interest, along with their respective present and
former employees, agents, officers, directors, principals and
affiliates, are permanently enjoined, from and after the
Effective Date, from (i) commencing or continuing in any
manner any action or other proceeding of any kind with respect
to any such Claim or Equity Interest against the Debtors or
Reorganized Debtors, (ii) the enforcement, attachment,
collection or recovery by any manner or means of any judgment,
award, decree or order against the Debtors or Reorganized
Debtors, (iii) creating, perfecting, or enforcing any
encumbrance of any kind against the Debtors or Reorganized
Debtors or against the property or interests in property of
the Debtors or Reorganized Debtors, or (iv) asserting any
right of setoff, subrogation or recoupment of any kind against
any obligation due from the Debtors or Reorganized Debtors or
against the property or interests in property
of the Debtors or Reorganized Debtors, with respect to any
such Claim or Equity Interest. The terms of such injunction
shall extend to any successors of the Debtors and Reorganized
Debtors and their respective properties and interest in
properties.
28. Notwithstanding the foregoing, Section 11.5 of the Plan of
Reorganization shall not in any way adversely impact the LM
Entities' alleged setoff and recoupment rights as set forth in
the adversary proceeding styled Space Systems/Loral, Inc. v.
International Launch Services, Inc., Lockheed Martin Comm'l
Launch Services, Inc. and Lockheed Khrunichev-Energio Int'l,
Inc., Adv. Proc. No. 04-2955 (RDD).
29. Injunction Against Interference With the Plan of
Reorganization. Pursuant to Section 11.7 of the Plan of
Reorganization and subject to all parties' rights under the
Bankruptcy Code and Bankruptcy Rules, (a) upon entry of the
Confirmation Order, all holders of Claims and Equity Interests
and other parties in interest, along with their respective
present or former employees, agents, officers, directors,
principals and affiliates, shall be enjoined from taking any
actions to interfere with the implementation or consummation
of the Plan of Reorganization and (b) nothing in the Plan of
Reorganization or this Confirmation Order shall affect,
release, enjoin, or impact in any way the prosecution of any
violations of fiduciary obligations under the Employee
Retirement Income Security Act of 1974, as amended, 29
U.S.C. 1001 et seq., against any Non-Debtor entity, including
but not limited to, the claims asserted against the Non-Debtor
defendants in the pending action in the United States District
Court for the Southern District of New York styled In re Loral
Space ERISA Litigation, Master File No. 03-CV-9729 (CTS).
30. Avoidance Actions. Pursuant to Section 11.10 of the Plan of
Reorganization, other than any actions covered by releases
granted in the Plan of Reorganization, or by this Confirmation
Order, from and after the Effective Date, the Reorganized
Debtors shall have the right to prosecute any avoidance or
equitable subordination or recovery actions under sections
105, 502(d), 510, 542 through 551, and 553 of the Bankruptcy
Code that belong to the Debtors or Debtors in Possession. Any
rights of the Equity Committee to prosecute claims set forth
in the complaint filed in Adversary Proceeding No. 05-02309
(RDD), if any, are subject to the Order Denying Motion of the
Official Committee of Equity Security Holders for Leave to
Prosecute Claim, entered of even date herewith.
31. Retention of Causes of Action/Reservation of Rights. Pursuant
to Section 11.11 of the Plan of Reorganization, nothing
contained in the Plan of Reorganization or this Confirmation
Order shall be deemed to be a waiver or the relinquishment of
any rights or causes of action that the Debtors or the
Reorganized Debtors may have or which the Reorganized Debtors
may choose to assert on behalf of their respective
estates under any provision of the Bankruptcy Code or any
applicable nonbankruptcy law, including, without limitation,
(i) any and all Claims against any person or entity, to the
extent such person or entity asserts a crossclaim,
counterclaim, and/or Claim for setoff which seeks affirmative
relief against the Debtors, the Reorganized Debtors, their
officers, directors, or representatives and (ii) any and all
Claims for the turnover of any property of the Debtors'
estates. Nothing contained in the Plan of Reorganization or
this Confirmation Order shall be deemed to be a waiver or
relinquishment of any claim, cause of action, right of setoff,
or other legal or equitable defense which the Debtors had
immediately prior to the Commencement Date, against or with
respect to any Claim left unimpaired by the Plan of
Reorganization. The Reorganized Debtors shall have, retain,
reserve, and be entitled to assert all such claims, causes of
action, rights of setoff, and other legal or equitable
defenses which the Debtors had immediately prior to the
Commencement Date fully as if the Reorganization Cases had not
been commenced, and all of the Reorganized Debtors' legal and
equitable rights respecting any Claim left unimpaired by the
Plan of Reorganization may be asserted after the Confirmation
Date to the same extent as if the Reorganization Cases had not
been commenced.
32. Terms of Injunctions or Stays. Pursuant to Section 11.6 of the
Plan of Reorganization, unless otherwise provided, all
injunctions or stays arising under or entered during the
Reorganization Cases under section
105 or 362 of the Bankruptcy Code or otherwise, and in
existence on the Confirmation Date, shall remain in full force
and effect until the later of the Effective Date and the date
indicated in the order providing for such injunction or stay.
33. Exit Financing. The terms and conditions of the Amended and
Restated Letter of Credit Reimbursement Agreement (the "Exit
L/C Agreement") between SS/L, as borrower, and JPMorgan Chase
Bank, N.A., as issuing lender (the "Issuing Lender"), any
security documents and all other documents related thereto
(together with the Exit L/C Agreement, the "Exit L/C Loan
Documents") are approved and ratified as being entered into in
good faith and being critical to the success of the Plan of
Reorganization. New SS/L is hereby authorized to execute and
deliver the Exit L/C Loan Documents and to perform all of its
obligations thereunder. The Exit L/C Loan Documents shall
constitute legal, valid, binding and authorized obligations of
SS/L, as a Reorganized Debtor, enforceable in accordance with
their terms. New SS/L is hereby authorized to pay all fees,
costs and expenses in connection with the Exit L/C Loan
Documents. On the Effective Date, all of the liens and
security interests to be granted in accordance with the Exit
L/C Loan Documents shall be deemed approved and shall be
legal, valid, binding and enforceable first priority liens on
the collateral securing the obligations under the Exit L/C
Loan Documents. In furtherance of the foregoing, SS/L, as a
Reorganized
Debtor, is hereby authorized to make all filings and
recordings, and to obtain all governmental approvals and
consents necessary to establish and perfect such liens and
security interests under the provisions of any applicable
federal, state or other law that would be applicable in the
absence of this Confirmation Order, and will thereafter
cooperate with the Issuing Lender to make all other filings
and recordings that otherwise would be reasonably necessary
under applicable law to give notice of such liens and security
interests to third parties.
34. Notwithstanding anything to the contrary contained in the Plan
of Reorganization or in this Confirmation Order, all
obligations incurred by SS/L under (i) the Letter of Credit
Reimbursement Agreement, dated as of April 2, 2004, between
SS/L, as borrower, and JPMorgan Chase Bank, N.A. (the
"Postpetition L/C Agreement") and (ii) the Cash Collateral
Agreement, dated as of April 2, 2004, between SS/L, as
pledgor, and JPMorgan Chase Bank, N.A. (the "Cash Collateral
Agreement" and together with the Postpetition L/C Agreement,
any security documents and all other documents related
thereto, the "Postpetition L/C Loan Documents"), shall not be
discharged and all liens and security interests granted in
connection therewith shall remain in full force and effect
(and SS/L hereby waives any such discharge pursuant to
Bankruptcy Code Section 1141(d)(4)). All fees, costs and
expenses paid by SS/L in connection with the Postpetition
L/C Loan Documents are hereby ratified and approved, and are
not subject to any defense, counterclaim, offset, or
avoidance.
35. Dissolution of Statutory Committees. Pursuant to Section 14.7
of the Plan of Reorganization, effective thirty (30) days
after the Effective Date if no appeal of this Confirmation
Order is then pending, the Creditors' Committee and the Equity
Committee shall dissolve with respect to the Debtors and their
respective members shall be released and discharged from all
further authority, duties, responsibilities and obligations
relating to the Reorganization Cases, with the exception that
the Creditors' Committee and the Equity Committee and their
respective professionals shall continue to be authorized to
perform their duties with respect to (i) applications filed
pursuant to sections 330 and 331 of the Bankruptcy Code, (ii)
motions seeking the enforcement of the provisions of the Plan
of Reorganization and the transactions contemplated under the
Plan of Reorganization or this Confirmation Order and (iii)
with respect to any adversary proceeding or appeal commenced
on or prior to the Effective Date.
36. Plan Modifications. Subject to Section 14.11(a) of the Plan of
Reorganization, after the Confirmation Date, so long as such
action does not materially adversely affect the treatment of
holders of Claims or Equity Interests under the Plan of
Reorganization, the Debtors or the Reorganized Debtors,
subject to the consent of the Creditors' Committee, may
institute proceedings in the Bankruptcy Court to
remedy any defect or omission or reconcile any inconsistencies
in the Plan of Reorganization or the Confirmation Order, with
respect to such matters as may be necessary to carry out the
purposes and effects of the Plan of Reorganization.
37. Other Amendments to the Plan of Reorganization. Prior to the
Effective Date, the Debtors, subject to the consent of the
Creditors' Committee, may make appropriate technical
adjustments and modifications to the Plan of Reorganization
without further order or approval of the Bankruptcy Court,
provided that such technical adjustments and modifications do
not adversely affect in a material way the treatment of
holders of Claims or Equity Interests.
38. Notice of Entry of Confirmation Order. On or before the date
that is ten (10) days after entry of this Confirmation Order,
the Debtors shall serve by first class mail a notice of the
entry of this Confirmation Order, in substantially the form
annexed hereto as Exhibit C (the "Confirmation Notice"), to
each of the following at their respective addresses last known
to the Debtors: (i) the Office of the United States Trustee
for the Southern District of New York, (ii) the attorneys for
the Creditors' Committee, (iii) the attorneys for the Equity
Committee, (iv) the attorneys for the Agent, (v) the attorneys
for the Backstop Purchaser, (vi) all parties entitled to
notice pursuant to this Court's Order, dated July 15, 2003,
establishing notice procedures in these chapter 11 cases,
(vii) the Securities and Exchange Commission
and the District Director of the Internal Revenue Service for
the Southern District of New York, (viii) all persons or
entities listed in the Debtors' schedules of assets and
liabilities, or any amendments thereto, (ix) all
counterparties to executory contracts and unexpired leases to
be assumed pursuant to the Plan of Reorganization and (x) any
other known holders of Claims against or Equity Interests in
the Debtors. Such service shall constitute good and sufficient
notice pursuant to Bankruptcy Rule 2002(f)(7) and 2002(i)-(l)
of the confirmation of the Plan of Reorganization and entry of
this Confirmation Order. The Debtors shall also cause the
Confirmation Notice to be published as promptly as practicable
after the Effective Date once in each of The Wall Street
Journal (national and international editions) and The New York
Times (national edition).
39. Conditions Precedent to the Effective Date. Pursuant to
Section 12.1 of the Plan of Reorganization, the occurrence of
the Effective Date of the Plan of Reorganization is subject to
the conditions precedent enumerated in Section 12.1 of the
Plan of Reorganization. The conditions precedent specified in
Section 12.1 of the Plan of Reorganization may be waived in
whole or in part by the Debtors and the Creditors' Committee
in each of their sole discretion, except with respect to
Section 12.1(f) of the Plan of Reorganization, which may be
waived only by the Backstop Purchasers, in their sole
discretion, but subject to the terms of and as provided in the
Backstop Commitment
Agreement. Any such waiver may be effected at any time,
without notice or leave or order of this Court, and must be in
writing.
40. Corporate Action. On the Effective Date, all matters provided
for under the Plan of Reorganization that would otherwise
require approval of the stockholders or directors of one or
more of the Debtors or Reorganized Debtors, including, without
limitation, the authorization to issue or cause to be issued
the New Loral Common Stock, the New Skynet Preferred Stock,
the New Skynet Notes, or the Subscription Rights, the issuance
of the New Loral Common Stock, the New Skynet Preferred Stock,
the New Skynet Notes and the Subscription Rights, the New
Management Stock Plan, the effectiveness of the New Loral
Certificate of Incorporation and the New Loral Bylaws, the
effectiveness of the New Skynet Certificate of Incorporation
and the New Skynet Bylaws, the effectiveness of the New SS/L
Certificate of Incorporation and the New SS/L Bylaws, the
effectiveness of the Reorganized Subsidiary Debtors'
Certificates of Incorporation and Reorganized Subsidiary
Debtors' Bylaws, all Restructuring Transactions to be
effectuated pursuant to the Plan of Reorganization, the
election or appointment, as the case may be, of directors and
officers of the Reorganized Debtors, including New Loral,
pursuant to the Plan of Reorganization and the authorization
and approval of the New Loral Employment Contracts, and the
qualification, of each of New Loral, New Skynet and New SS/L
as a
foreign corporation wherever the conduct of business by such
entities requires such qualification shall be deemed to have
occurred and shall be in effect from and after the Effective
Date pursuant to the applicable general corporation law of the
states in which the Debtors or the Reorganized Debtors are
incorporated, without any requirement of further action by the
stockholders or directors of the Debtors or the Reorganized
Debtors; provided, however, that in accordance with Section
10.2(a) of the Plan of Reorganization, the election or
appointment, as the case may be, of each of Messrs. Mark H.
Rachesky, Hal Goldstein and Sai S. Devabhaktuni (or any other
director of the applicable Reorganized Debtors who is,
immediately prior to the Effective Date, employed by or
otherwise associated with MHR Fund Management LLC) as
directors of the applicable Reorganized Debtors shall be
deemed to have occurred and shall be in effect only from and
after the date that is two (2) Business Days after the
Effective Date. On the Effective Date, or as soon thereafter
as is practicable, the Reorganized Debtors, including New
Loral, shall, if required, file their amended certificates of
incorporation with the Secretary of State of the state in
which each such entity is (or will be) organized, in
accordance with the applicable general business law of each
such jurisdiction. Additionally, it is hereby ordered that (a)
the directors of New Loral who were disclosed to the
Bankruptcy Court pursuant to Section 10.2 of the Plan of
Reorganization shall be deemed
to have been elected by the action of the stockholders of New
Loral at an annual meeting of the stockholders for the
election of directors which shall be deemed to have validly
occurred on the Effective Date, effective, with respect to the
election of the directors specified in the proviso to the
first sentence of this paragraph 40, two (2) Business Days
thereafter and (b) in accordance with Section 10.2(a) of the
Plan of Reorganization, the next annual meeting of the
stockholders of New Loral shall take place not earlier than
twelve (12) months after the Effective Date.
41. No Further Action. All actions authorized to be taken pursuant
to the Plan of Reorganization, including, without limitation,
the Restructuring Transactions set forth in Section 5.2 of the
Plan of Reorganization, shall be effective on or as of the
Effective Date pursuant to this Confirmation Order, without
further application to, or order of this Court, or further
action by the respective officers, directors, members, or
stockholders of New Loral, New Skynet, New SS/L, or the other
Reorganized Debtors, and with the effect that such actions had
been taken by unanimous action of such officers, directors,
members, or stockholders.
42. GlobalTel. On June 17, 2004, the United States Bankruptcy
Court for the District of Delaware with jurisdiction over the
chapter 11 cases of Globalstar, L.P. (the "Globalstar
Bankruptcy Court") entered that certain Order Confirming the
Debtors' First Modified Fourth
Amended Joint Plan Under Chapter 11 of the Bankruptcy Code
(the "Globalstar Confirmation Order"). On June 29, 2004, the
Globalstar Bankruptcy Court entered that certain Notice of (A)
Entry of Order Confirming the Debtors' First Modified Fourth
Amended Joint Plan Under Chapter 11 of the Bankruptcy Code,
(B) Occurrence of the Effective Date, (C) Deadline to File
Proof of Certain Rejection Damage Claims and (D) Deadline to
File Proof of Certain Administrative Claims (the "Globalstar
Effective Date Notice"). Pursuant to the Globalstar
Confirmation Order and the Globalstar Effective Date Notice,
Ltd. is the owner by legal succession from Globalstar, L.P. of
a 49% equity interest in Russian Closed Joint Stock Company
"Globalstar-Space Telecommunications" ("CJSC GlobalTel").
Pursuant to the Plan of Reorganization, without further motion
to or order of the Bankruptcy Court, (i) Ltd. will be
liquidated under the laws of Bermuda, and (ii) on the
Effective Date of the Plan of Reorganization, title to the
equity interests in CJSC GlobalTel held by Ltd. shall
irrevocably pass to New Loral or its affiliate designee (which
shall be designated by New Loral no later than ten (10) days
prior to the Effective Date of the Plan of Reorganization)
such that New Loral or such affiliate designee shall be Ltd.'s
legal successor with respect to Ltd.'s interest in the equity
interest in CJSC GlobalTel. On or promptly after the Effective
Date of the Plan of Reorganization,
Ltd. shall execute and provide to New Loral any documents
reasonably requested by New Loral to evidence such legal
succession.
43. Effect of Failure of Conditions to Effective Date. Pursuant to
Section 12.2 of the Plan of Reorganization, in the event the
conditions precedent specified in Section 12.1 of the Plan of
Reorganization have not been satisfied or waived by 120 days
after the Confirmation Date, or, if such conditions would have
been satisfied by such date but were not so satisfied as a
result of the condition in Section 12.1(g) of the Plan of
Reorganization not being so satisfied, then, such 120 day
period shall be 180 days after the Confirmation Date, then (i)
this Confirmation Order shall be vacated, (ii) no
distributions under the Plan of Reorganization shall be made,
(iii) the Debtors and all holders of Claims and Equity
Interests shall be restored to the status quo ante as of the
day immediately preceding the Confirmation Date as though the
Confirmation Date never occurred and (iv) all of the Debtors'
obligations with respect to the Claims and Equity Interests
shall remain unchanged and nothing contained herein shall be
deemed to constitute a waiver or release of any claims by or
against the Debtors or any other entity or to prejudice in any
manner the rights of the Debtors, the Backstop Purchasers, the
Creditors' Committee, or any other entity in any further
proceedings involving the Debtors.
44. Revocation or Withdrawal of the Plan of Reorganization. The
Debtors reserve the right to revoke or withdraw the Plan of
Reorganization
prior to the Effective Date. If the Debtors take such action,
the Plan of Reorganization shall be deemed null and void. In
such event, nothing contained in the Plan of Reorganization
shall constitute or be deemed a waiver or release of any
Claims by or against the Debtors or any other person or to
prejudice in any manner the rights of the Debtors or any
person in any further proceedings involving the Debtors.
45. Governing Law. Except to the extent that the Bankruptcy Code
or other federal law is applicable, or to the extent an
exhibit to the Plan of Reorganization or a schedule or
document in the Plan Supplement provides otherwise, the
rights, duties and obligations arising under the Plan of
Reorganization shall be governed by, and construed and
enforced in accordance with, the laws of the State of New
York, without giving effect to the principles of conflict of
laws thereof.
46. Severability. Each term and provision of the Plan of
Reorganization, as it may have been altered or interpreted by
this Court, is valid and enforceable pursuant to its terms.
47. Conflicts Between Confirmation Order and Plan of
Reorganization. The failure to specifically include any
particular provision of the Plan of Reorganization in this
Confirmation Order will not diminish the effectiveness of such
provision, it being the intent of this Court that the Plan of
Reorganization is confirmed in its entirety and it and the
Plan Supplement are incorporated herein by this reference. To
the extent of any inconsistency between the provisions of the
Plan of
Reorganization and this Confirmation Order, the terms and
conditions contained in this Confirmation Order shall govern.
The provisions of this Confirmation Order are integrated with
each other and are nonseverable and mutually dependent unless
expressly stated by further order of this Court.
48. Reference. The failure specifically to include or reference
any particular provision of the Plan of Reorganization or any
related agreement in this Confirmation Order shall not
diminish or impair the efficacy of such provision or such
related agreements, it being understood that it is the intent
of this Court that the Plan of Reorganization be confirmed and
such related agreements be approved in their entirety.
49. Retention of Jurisdiction. This Court may properly, and upon
the Effective Date shall, to the extent authorized by law,
retain jurisdiction over the matters arising in and under, and
related to, the Reorganization Cases, as set forth in Article
13 of the Plan of Reorganization and section 1142 of the
Bankruptcy Code.
Dated: August 1, 2005
New York, New York
/s/ ROBERT D. DRAIN
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HONORABLE ROBERT D. DRAIN
UNITED STATES BANKRUPTCY JUDGE