SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
February 15, 2002
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LORAL SPACE & COMMUNICATIONS LTD.
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(Exact name of registrant as specified in its charter)
Islands of Bermuda 1-14180 13-3867424
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation) Number
c/o Loral SpaceCom Corporation,
600 Third Avenue, New York, New York 10016
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code:
(212) 697-1105
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Item 5. Other Events.
On February 15, 2002 (the "Petition Date"), Globalstar, L.P.
("Globalstar") and certain of its direct subsidiaries filed voluntary
petitions under Chapter 11 of Title 11, United States Code in the United
States Bankruptcy Court for the District of Delaware (the "Court"). In
connection therewith, Loral/Qualcomm Satellite Services, L.P., the managing
general partner of Globalstar, its general partner, Loral/Qualcomm
Partnership, L.P. ("LQP"), and certain of registrant's subsidiaries that serve
as general partners of LQP also filed voluntary petitions with the Court. As
of December 31, 2001, registrant's direct and indirect investment in
connection with Globalstar-related activities as set forth on its balance
sheet was approximately $32 million. This investment is comprised primarily of
registrant's investment in Globalstar's $500 million credit facility, which
was fully written off by registrant in December 2000.
Prior to the Petition Date, Globalstar reached an agreement with
registrant and an informal committee of noteholders regarding the substantive
terms of a financial and legal restructuring of Globalstar's business. The
proposed restructuring plan, which will have to be submitted for and will be
subject to Court approval, calls for the establishment of a new Globalstar
company which will, in addition to taking ownership of all of Globalstar's
existing assets, acquire certain service provider operations, including
registrant's Canadian service provider company. Under the proposed
restructuring plan, the new company will initially be owned by Globalstar's
existing noteholders and other unsecured creditors, including registrant. The
proposed plan also calls for the cancellation of all existing partnership
interests in Globalstar, but contemplates, subject to the satisfaction of
certain conditions, a rights offering to common and preferred shareholders in
Globalstar Telecommunications Limited and Globalstar's creditors which could
give them the option to purchase shares in the new company. The proposed plan
will also provide for mutual releases of claims related to Globalstar to be
granted to and by various persons, including, among others, Globalstar,
Globalstar's officers and directors, the registrant and its affiliates,
Globalstar partners, service providers acquired by Globalstar and the members
of any official and informal committees of creditors.
For a complete description of terms of the agreement among Globalstar,
registrant and the informal committee of noteholders, see the Memorandum of
Understanding dated February 15, 2002 and the Plan Support Agreement dated
February 15, 2002, copies of which are filed herewith and which are
incorporated by reference herein.
Item 7. Financial Statements, Pro Forma Financial Information and
Exhibits.
(c) Exhibits.
Exhibit 99.1 Memorandum of Understanding dated February 15, 2002
Exhibit 99.2 Plan Support Agreement dated February 15, 2002
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
LORAL SPACE & COMMUNICATIONS LTD.
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(Registrant)
Date: February 27, 2002 By: /s/ Avi Katz
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Avi Katz
Vice President, General
Counsel and Secretary
Exhibit Index
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Exhibit 99.1 Memorandum of Understanding dated February 15, 2002
Exhibit 99.2 Plan Support Agreement dated February 15, 2002