NEW YORK, Sept. 22, 2008 (GLOBE NEWSWIRE) -- Loral Space & Communications Inc. (Nasdaq:LORL) today announced that, on September 19, 2008, the Delaware Chancery Court issued its decision in the shareholder derivative and Loral Skynet noteholder actions pending before the court.
In the shareholder derivative action, the court held that the MHR Fund Management LLC's $300 million investment in Loral did not meet the entire fairness standard under Delaware law. The Court ordered that MHR's preferred shares be converted into 9,505,673 non-voting common shares. As a result of the decision, MHR will own 56% of Loral's total equity and 35.5% of the voting power, the same level of voting power it had prior to the financing.
Additionally, the Court dismissed the action brought by the Loral Skynet noteholders, concluding that the early redemption of Loral Skynet's 14% Senior Secured Cash/PIK Notes due 2015 was proper and did not violate the covenant of good faith and fair dealing implied in the indenture governing the notes.
The court directed that the parties collaborate on an order to implement the decision and present it to the court within 15 days.
About Loral Space & Communications
Loral Space & Communications is a satellite communications company. It is a world-class leader in the design and manufacture of satellites and satellite systems for commercial and government applications including direct-to-home television, broadband communications, wireless telephony, weather monitoring and air traffic management. Loral also owns 64 percent of Telesat Canada, a global operator of telecommunications and direct broadcast satellites used to distribute video entertainment programming, broadband data, and provide access to Internet services and other value-added communications services. For more information, visit Loral's web site at www.loral.com.
This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In addition, Loral Space & Communications Inc. or its representatives have made or may make forward-looking statements, orally or in writing, which may be included in, but are not limited to, various filings made from time to time with the Securities and Exchange Commission, and press releases or oral statements made with the approval of an authorized executive officer of the company. Actual results could differ materially from those projected or suggested in any forward-looking statements as a result of a wide variety of factors and conditions. Many of these factors and conditions are described under the caption "Risk Factors" in the company's annual report on Form 10-K for the fiscal year ended December 31, 2007 and in its subsequent reports on Form 10-Q. The reader is specifically referred to these documents, as well as the company's other filings with the Securities and Exchange Commission.