Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | May 11, 2021 | |
Entity Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Mar. 31, 2021 | |
Document Fiscal Year Focus | 2021 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 | |
Amendment Flag | false | |
Entity File Number | 1-14180 | |
Entity Registrant Name | LORAL SPACE & COMMUNICATIONS INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 87-0748324 | |
Entity Address, Address Line One | 600 Fifth Avenue | |
Entity Address, City or Town | New York | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10020 | |
City Area Code | 212 | |
Local Phone Number | 697-1105 | |
Entity Central Index Key | 0001006269 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Preferred Stock Purchase Rights [Member] | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Preferred Stock Purchase Rights | |
No Trading Symbol Flag | true | |
Security Exchange Name | NASDAQ | |
Voting Common Stock [Member] | ||
Entity Information [Line Items] | ||
Title of 12(b) Security | Voting Common stock, $.01 par value | |
Trading Symbol | LORL | |
Security Exchange Name | NASDAQ | |
Entity Common Stock, Shares Outstanding | 21,427,078 | |
Nonvoting Common Stock [Member] | ||
Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 9,505,673 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents | $ 25,460 | $ 31,631 |
Income tax refund receivable | 1,228 | 1,228 |
Other current assets | 1,801 | 1,232 |
Total current assets | 28,489 | 34,091 |
Right-of-use asset | 469 | 342 |
Investments in affiliates | 225,133 | 192,664 |
Deferred tax assets | 27,819 | 27,339 |
Other assets | 34 | 33 |
Total assets | 281,944 | 254,469 |
Current liabilities: | ||
Accrued employment costs | 1,379 | 2,839 |
Other current liabilities | 2,180 | 2,002 |
Total current liabilities | 3,559 | 4,841 |
Pension and other post-retirement liabilities | 19,793 | 20,181 |
Other liabilities | 20,159 | 19,914 |
Total liabilities | 43,511 | 44,936 |
Commitments and contingencies | ||
Shareholders' Equity: | ||
Preferred stock, $0.01 par value | 0 | 0 |
Common Stock: | ||
Paid-in capital | 1,019,988 | 1,019,988 |
Accumulated deficit | (698,486) | (729,202) |
Accumulated other comprehensive loss | (73,788) | (71,972) |
Total shareholders' equity | 238,433 | 209,533 |
Total liabilities and shareholders' equity | 281,944 | 254,469 |
Voting Common Stock [Member] | ||
Common Stock: | ||
Common stock, $0.01 par value | 216 | 216 |
Treasury stock (at cost), 154,494 shares of voting common stock | (9,592) | (9,592) |
Nonvoting Common Stock [Member] | ||
Common Stock: | ||
Common stock, $0.01 par value | 95 | 95 |
Series A Preferred Stock [Member] | ||
Shareholders' Equity: | ||
Preferred stock, $0.01 par value | 0 | 0 |
Series B Preferred Stock [Member] | ||
Shareholders' Equity: | ||
Preferred stock, $0.01 par value | $ 0 | $ 0 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Mar. 31, 2021 | Dec. 31, 2020 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Series A Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 50,000 | 50,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Series B Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 5 | 5 |
Preferred stock, shares issued | 5 | 5 |
Preferred stock, shares outstanding | 5 | 5 |
Voting Common Stock [Member] | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares issued | 21,581,572 | 21,581,572 |
Treasury stock, shares | 154,494 | 154,494 |
Nonvoting Common Stock [Member] | ||
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 20,000,000 | 20,000,000 |
Common stock, shares issued | 9,505,673 | 9,505,673 |
Shares issued and outstanding | 9,505,673 | 9,505,673 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Consolidated Statements of Operations [Abstract] | ||
General and administrative expenses | $ (1,729) | $ (1,648) |
Operating income (loss) | (1,729) | (1,648) |
Interest and investment income | 2 | 937 |
Interest expense | (6) | (5) |
Other expense | (2,375) | (1,437) |
Income (loss) before income taxes and equity in net income (loss) of affiliates | (4,108) | (2,153) |
Income tax (provision) benefit | 222 | (2,116) |
Income (loss) before equity in net income (loss) of affiliates | (3,886) | (4,269) |
Equity in net income (loss) of affiliates | 34,602 | (117,074) |
Net income (loss) | 30,716 | (121,343) |
Other comprehensive income (loss), net of tax | (1,816) | 31,290 |
Comprehensive income (loss) | $ 28,900 | $ (90,053) |
Net income per share: | ||
Basic | $ 0.99 | $ (3.92) |
Diluted | $ 0.98 | $ (3.92) |
Weighted average common shares outstanding: | ||
Basic | 30,933 | 30,933 |
Diluted | 31,032 | 30,933 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Shareholders' Equity - USD ($) $ in Thousands | Voting Common Stock [Member]Common Stock [Member] | Voting Common Stock [Member] | Nonvoting Common Stock [Member]Common Stock [Member] | Nonvoting Common Stock [Member] | Paid-In Capital [Member] | Treasury Stock Voting [Member] | Accumulated Deficit [Member] | Accumulated Other Comprehensive Loss [Member] | Total |
Balance at Dec. 31, 2019 | $ 216 | $ 95 | $ 1,019,988 | $ (9,592) | $ (605,766) | $ (54,914) | $ 350,027 | ||
Balance, shares at Dec. 31, 2019 | 21,582,000 | 9,506,000 | 154,000 | ||||||
Net income (loss) | (121,343) | (121,343) | |||||||
Other comprehensive income (loss) | 31,290 | 31,290 | |||||||
Comprehensive income (loss) | (90,053) | ||||||||
Balance at Mar. 31, 2020 | $ 216 | $ 95 | 1,019,988 | $ (9,592) | (727,109) | (23,624) | 259,974 | ||
Balance, shares at Mar. 31, 2020 | 21,582,000 | 9,506,000 | 154,000 | ||||||
Balance at Dec. 31, 2019 | $ 216 | $ 95 | 1,019,988 | $ (9,592) | (605,766) | (54,914) | 350,027 | ||
Balance, shares at Dec. 31, 2019 | 21,582,000 | 9,506,000 | 154,000 | ||||||
Other comprehensive income (loss) | (17,058) | ||||||||
Common dividends paid ($7.00 per share) | (216,500) | ||||||||
Balance at Dec. 31, 2020 | $ 216 | $ 95 | 1,019,988 | $ (9,592) | (729,202) | (71,972) | 209,533 | ||
Balance, shares at Dec. 31, 2020 | 21,582,000 | 21,581,572 | 9,506,000 | 9,505,673 | 154,000 | ||||
Balance at Mar. 31, 2020 | $ 216 | $ 95 | 1,019,988 | $ (9,592) | (727,109) | (23,624) | 259,974 | ||
Balance, shares at Mar. 31, 2020 | 21,582,000 | 9,506,000 | 154,000 | ||||||
Net income (loss) | 214,436 | ||||||||
Other comprehensive income (loss) | (48,348) | ||||||||
Comprehensive income (loss) | 166,088 | ||||||||
Common dividends paid ($7.00 per share) | (216,529) | (216,529) | |||||||
Balance at Dec. 31, 2020 | $ 216 | $ 95 | 1,019,988 | $ (9,592) | (729,202) | (71,972) | 209,533 | ||
Balance, shares at Dec. 31, 2020 | 21,582,000 | 21,581,572 | 9,506,000 | 9,505,673 | 154,000 | ||||
Net income (loss) | 30,716 | 30,716 | |||||||
Other comprehensive income (loss) | (1,816) | (1,816) | |||||||
Comprehensive income (loss) | 28,900 | ||||||||
Balance at Mar. 31, 2021 | $ 216 | $ 95 | $ 1,019,988 | $ (9,592) | $ (698,486) | $ (73,788) | $ 238,433 | ||
Balance, shares at Mar. 31, 2021 | 21,582,000 | 21,581,572 | 9,506,000 | 9,505,673 | 154,000 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Shareholders' Equity (Parenthetical) | 12 Months Ended |
Dec. 31, 2020$ / shares | |
Consolidated Statements of Shareholders' Equity [Abstract] | |
Common dividend paid per share | $ 7 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Operating activities: | ||
Net income (loss) | $ 30,716 | $ (121,343) |
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities: | ||
Non-cash operating items (Note 2) | (34,767) | 118,945 |
Changes in operating assets and liabilities: | ||
Other current assets | (569) | (278) |
Accrued employment costs and other current liabilities | (1,442) | (1,498) |
Income taxes receivable and payable | 34 | (903) |
Pension and other postretirement liabilities | (388) | (386) |
Other liabilities | 245 | 1,594 |
Net cash (used in) provided by operating activities | (6,171) | (3,869) |
Cash, cash equivalents and restricted cash - period (decrease) increase | (6,171) | (3,869) |
Cash, cash equivalents and restricted cash - beginning of year | 31,935 | 259,371 |
Cash, cash equivalents and restricted cash - end of period | $ 25,764 | $ 255,502 |
Organization and Principal Busi
Organization and Principal Business | 3 Months Ended |
Mar. 31, 2021 | |
Organization and Principal Business [Abstract] | |
Organization and Principal Business | 1. Organization and Principal Business Loral Space & Communications Inc., together with its subsidiaries (“Loral,” the “Company,” “we,” “our” and “us”) is a leading satellite communications company engaged, through our ownership interests in affiliates, in satellite-based communications services. On November 23, 2020, Loral entered into a Transaction Agreement and Plan of Merger (as it may be amended from time to time, the “Transaction Agreement”) with Telesat Canada, a Canadian corporation (“Telesat”), Telesat Partnership LP, a limited partnership formed under the laws of Ontario, Canada (“Telesat Partnership”), Telesat Corporation, a newly formed corporation incorporated under the laws of the Province of British Columbia, Canada and the sole general partner of Telesat Partnership (“Telesat Corporation”), Telesat CanHold Corporation, a corporation incorporated under the laws of British Columbia, Canada and wholly owned subsidiary of Telesat Partnership (“Telesat CanHoldco”), Lion Combination Sub Corporation, a Delaware corporation and wholly owned subsidiary of the Company (“Merger Sub”), Public Sector Pension Investment Board, a Canadian Crown corporation (“PSP”), and Red Isle Private Investments Inc., a Canadian corporation and wholly owned subsidiary of PSP (“Red Isle”), under which Merger Sub will merge with and into Loral, with Loral surviving the merger as a wholly owned subsidiary of Telesat Partnership (the “Merger”), and Loral stockholders receiving common shares of Telesat Corporation and/or units of Telesat Partnership that will be exchangeable for common shares of Telesat Corporation (the “Transaction”). The Transaction Agreement contains a number of customary conditions that must be fulfilled to complete the Transaction, including (i) approval of (A) a majority of the outstanding Loral voting common stock and (B) a majority of the outstanding Loral voting common stock not held by MHR, PSP, any other party to the Transaction Agreement or certain of their respective affiliates; (ii) the parties having obtained certain regulatory consents and approvals; (iii) no legal proceedings having been commenced that would enjoin or prohibit the consummation of the Transaction; (iv) the listing of the Class A and Class B shares of Telesat Corporation on a U.S. securities exchange; (v) no “Material Adverse Effect” (as defined in the Transaction Agreement) having occurred; (vi) Telesat remaining in good standing with respect to its material debt obligations; (vii) the accuracy of certain representations (subject to certain qualifications as to materiality) and material performance of certain covenants by the parties, subject to specified exceptions; (viii) effectiveness of the registration statement on Form F-4 and the issuance of a receipt for each of the Canadian preliminary and final prospectuses in respect of the Transaction; (ix) no U.S., Canadian or Spanish governmental agency having commenced civil or criminal proceeding against Loral alleging that any member of the “Loral Group” has criminally violated any law, and no member of the “Loral Group” having been indicted or convicted for, or pled nolo contendere to, any such alleged criminal violation; (x) Loral remaining solvent and not having entered into any bankruptcy or related proceeding; and (xi) the delivery by the parties of certain closing deliverables. If the parties have confirmed that all the conditions are satisfied or waived (other than those conditions that by their terms are to be satisfied at the closing of the Transaction (the “Closing”), but which conditions are capable of being satisfied at the Closing), then PSP and Loral will each have the right to extend the Closing for any number of periods of up to 30 days each and no longer than 120 days in the aggregate, from the date on which the Closing otherwise would have occurred. If the Closing is extended, the Closing will occur on the first two consecutive business days commencing on the fifth business day after the expiration of the final extension period on which the conditions are satisfied or waived (other than the conditions (i) with respect to no “Material Adverse Effect” (as defined in the Transaction Agreement) having occurred, (ii) that by their terms are to be satisfied at the Closing, but subject to the satisfaction or waiver of such conditions at the Closing and (iii) if PSP extends the Closing, with respect to a civil or criminal legal proceeding alleging that Loral or any of its subsidiaries (excluding XTAR, LLC (“XTAR”) and Globalstar de Mexico, S. de R.L. de C.V. (“GdM”) and their subsidiaries), has criminally violated a law). Subject to the satisfaction of the conditions to Closing and any extensions described above, we expect to complete the Transaction in the third quarter of 2021. Upon satisfaction of the terms and subject to the conditions set forth in the Transaction Agreement, the Transaction will result in the current stockholders of Loral, PSP and the other shareholders in Telesat (principally current or former management of Telesat) owning approximately the same percentage of equity in Telesat indirectly through Telesat Corporation and/or Telesat Partnership as they currently hold (indirectly in the case of Loral stockholders and PSP) in Telesat, Telesat Corporation becoming the publicly traded general partner of Telesat Partnership and Telesat Partnership indirectly owning all of the economic interests in Telesat, except to the extent that the other shareholders in Telesat elect to retain their direct interest in Telesat. The Transaction Agreement provides certain termination rights for both Loral and PSP and further provides that, in certain circumstances, Loral may be required to pay to Red Isle a termination fee of $6,550,000 or $22,910,000, or to pay to PSP a “breach” fee of $40,000,000, in each case as provided in the Transaction Agreement. Expenses related to the Transaction included in other expense in our statements of operations for the three months ended March 31, 2021 and 2020 were $2.3 million and $1.4 million, respectively. Description of Business Loral has one operating segment consisting of satellite-based communications services. Loral participates in satellite services operations primarily through its ownership interest in Telesat, a leading global satellite operator. Loral holds a 62.6% economic interest and a 32.6% voting interest in Telesat. We use the equity method of accounting for our ownership interest in Telesat (see Note 5). Telesat owns and leases a satellite fleet that operates in geostationary earth orbit approximately 22,000 miles above the equator. In this orbit, satellites remain in a fixed position relative to points on the earth’s surface and provide reliable, high-bandwidth services anywhere in their coverage areas, serving as the backbone for many forms of telecommunications. Telesat is also developing Telesat Lightspeed, a global constellation of low earth orbit (“LEO”) satellites. LEO satellites operate in a circular orbit around the earth with an altitude typically between 500 and 870 miles. Unlike geostationary orbit satellites that operate in a fixed orbital location above the equator, LEO satellites travel around the earth at high velocities requiring antennas on the ground to track their movement. LEO satellite systems have the potential to offer a number of advantages over geostationary orbit satellites to meet growing requirements for broadband services, both consumer and commercial, by providing increased data speeds and capacity, global coverage, and latency on par with, or potentially better than, terrestrial services. |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2021 | |
Basis of Presentation [Abstract] | |
Basis of Presentation | 2. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared pursuant to the rules of the Securities and Exchange Commission (“SEC”) and, in our opinion, include all adjustments (consisting of normal recurring accruals) necessary for a fair presentation of results of operations, financial position and cash flows as of the balance sheet dates presented and for the periods presented. Certain information and footnote disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted pursuant to SEC rules. We believe that the disclosures made are adequate to keep the information presented from being misleading. The results of operations for the three months ended March 31, 2021 are not necessarily indicative of the results to be expected for the full year. The December 31, 2020 balance sheet has been derived from the audited consolidated financial statements at that date. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in our latest Annual Report on Form 10-K filed with the SEC. Investments in Affiliates Our ownership interest in Telesat is accounted for using the equity method of accounting under U.S. GAAP. Telesat’s financial statements are prepared in accordance with international financial reporting standards (“IFRS”). To allow our reporting of our investment in Telesat under U.S. GAAP, Telesat provides us with a reconciliation of its financial statements from IFRS to U.S. GAAP. Income and losses of Telesat are recorded based on our economic interest. The contribution of Loral Skynet, a wholly owned subsidiary of Loral prior to its contribution to Telesat in 2007, was recorded by Loral at the historical book value of our retained interest combined with the gain recognized on the contribution. However, the contribution was recorded by Telesat at fair value. Accordingly, the amortization of Telesat fair value adjustments applicable to the Loral Skynet assets and liabilities acquired by Telesat in 2007 is proportionately eliminated in determining our share of the net income of Telesat. Our equity in net income or loss of Telesat also reflects amortization of profits eliminated, to the extent of our economic interest in Telesat, on satellites we constructed for Telesat while we owned Space Systems/Loral, LLC (formerly known as Space Systems/Loral, Inc.) (“SSL”) and on Loral’s sale to Telesat in April 2011 of its portion of the payload on the ViaSat-1 satellite and related assets. Non-refundable cash distributions received from Telesat in excess of our initial investment and our share of cumulative equity in comprehensive income of Telesat, net of cash distributions received in prior periods, are recorded as equity in net income of Telesat (“Excess Cash Distribution”) since we have no obligation to provide future financial support to Telesat. After receiving an Excess Cash Distribution, we do not record additional equity in net income of Telesat until our share of Telesat’s future net income exceeds the Excess Cash Distribution. Equity in losses of affiliates is not recognized after the carrying value of an investment, including advances and loans, has been reduced to zero, unless guarantees or other funding obligations exist. We had no guarantees or other funding obligations for our equity method investments as of March 31, 2021 and December 31, 2020. We use the nature of distribution approach to classify distributions from equity method investments on the statements of cash flows. The Company monitors its equity method investments for factors indicating other-than-temporary impairment. An impairment loss is recognized when there has been a loss in value of the affiliate that is other-than-temporary. Use of Estimates in Preparation of Financial Statements The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the amount of income (loss) reported for the period. Actual results could materially differ from estimates. Significant estimates also included the allowances for doubtful accounts, income taxes, including the valuation of deferred tax assets, the fair value of liabilities indemnified, the dilutive effect of Telesat stock options (see Note 10) and our pension liabilities. Cash, Cash Equivalents and Restricted Cash As of March 31, 2021, the Company had $25.5 million of cash and cash equivalents. Cash and cash equivalents include liquid investments, primarily money market funds, with maturities of less than 90 days at the time of purchase. Management determines the appropriate classification of its investments at the time of purchase and at each balance sheet date. On April 30, 2020, the Company’s Board of Directors declared a special dividend of $5.50 per share for an aggregate dividend of approximately $170.1 million. The special dividend was paid on May 28, 2020 to holders of record of Loral voting and non-voting common stock as of the close of business on May 14, 2020. On November 23, 2020, the Company’s Board of Directors declared a special dividend of $1.50 per share for an aggregate dividend of approximately $46.4 million. The special dividend was paid on December 17, 2020 to holders of record of Loral voting and non-voting common stock as of the close of business on December 4, 2020. As of March 31, 2021 and December 31, 2020, the Company had restricted cash of $0.3 million, representing the amount pledged as collateral to the issuer of a standby letter of credit (the “LC”). The LC, which expires in February 2022, has been provided as a guaranty to the lessor of our corporate offices. The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheet to the condensed consolidated statement of cash flows (in thousands): March 31, December 31, 2021 2020 Cash and cash equivalents $ 25,460 $ 31,631 Restricted cash included in other current assets 304 304 Cash, cash equivalents and restricted cash shown in the statement of cash flows $ 25,764 $ 31,935 Concentration of Credit Risk Financial instruments which potentially subject us to concentrations of credit risk consist principally of cash and cash equivalents and receivables. Our cash and cash equivalents are maintained with high-credit-quality financial institutions. As of March 31, 2021 and December 31, 2020, our cash and cash equivalents were invested primarily in two liquid government AAA money market funds. Such funds are not insured by the Federal Deposit Insurance Corporation. The dispersion across funds reduces the exposure of a default at any one fund. As a result, management believes that its potential credit risks are minimal. Fair Value Measurements U.S. GAAP defines fair value as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants. U.S. GAAP also establishes a fair value hierarchy that gives the highest priority to observable inputs and the lowest priority to unobservable inputs. The three levels of the fair value hierarchy are described below: Level 1: Level 2: Level 3: Assets and Liabilities Measured at Fair Value The following table presents our assets and liabilities measured at fair value on a recurring and non-recurring basis (in thousands): March 31, 2021 December 31, 2020 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Assets Cash and cash equivalents: Money market funds $ 22,167 $ — $ — $ 29,166 $ — $ — Other current assets: Indemnification - Sale of SSL — — 598 — — 598 Liabilities Other liabilities: Indemnification - Globalstar do Brasil S.A. $ — $ — $ 145 $ — $ — $ 145 The carrying amount of money market funds approximates fair value as of each reporting date because of the short maturity of those instruments. The Company did not have any non-financial assets or non-financial liabilities that were recognized or disclosed at fair value as of March 31, 2021 and December 31, 2020. Assets and Liabilities Measured at Fair Value on a Non-recurring Basis We review the carrying values of our equity method investments when events and circumstances warrant and consider all available evidence in evaluating when declines in fair value are other-than-temporary. The fair values of our investments are determined based on valuation techniques using the best information available and may include quoted market prices, market comparables and discounted cash flow projections. An impairment charge is recorded when the carrying amount of the investment exceeds its current fair value and is determined to be other-than-temporary. The asset resulting from the indemnification of SSL is for certain pre-closing taxes and reflects the excess of payments since inception over refunds and the estimated liability, which was originally determined using the fair value objective approach. The estimated liability for indemnifications relating to Globalstar do Brasil S.A. (“GdB”), originally determined using expected value analysis, is net of payments since inception. Contingencies Contingencies by their nature relate to uncertainties that require management to exercise judgment both in assessing the likelihood that a liability has been incurred as well as in estimating the amount of potential loss, if any. We accrue for costs relating to litigation, claims and other contingent matters when such liabilities become probable and reasonably estimable. Such estimates may be based on advice from third parties or on management’s judgment, as appropriate. Actual amounts paid may differ from amounts estimated, and such differences will be charged to operations in the period in which the final determination of the liability is made. Income Taxes Loral and its subsidiaries are subject to U.S. federal, state and local income taxation on their worldwide income and foreign taxation on certain income from sources outside the United States. Telesat is subject to tax in Canada and other jurisdictions, and Loral will provide in each period any additional U.S. current and deferred tax required on actual or deemed distributions from Telesat, including Global Intangible Low Taxed Income (“GILTI”). Deferred income taxes reflect the future tax effect of temporary differences between the carrying amount of assets and liabilities for financial and income tax reporting and are measured by applying anticipated statutory tax rates in effect for the year during which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent it is more likely than not that the deferred tax assets will not be realized. The tax benefit of an uncertain tax position (“UTP”) taken or expected to be taken in income tax returns is recognized only if it is “more likely than not” to be sustained on examination by the taxing authorities, based on its technical merits as of the reporting date. The tax benefit recognized in the financial statements from such a position is measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. The Company recognizes interest and penalties related to income taxes in income tax expense on a quarterly basis. The unrecognized tax benefit of a UTP is recognized in the period when the UTP is effectively settled. Previously recognized tax positions are derecognized in the first period in which it is no longer more likely than not that the tax position would be sustained upon examination. Earnings per Share Basic earnings per share are computed based upon the weighted average number of shares of voting and non-voting common stock outstanding during each period. Shares of non-voting common stock are in all respects identical to and treated equally with shares of voting common stock except for the absence of voting rights (other than as provided in Loral’s Amended and Restated Certificate of Incorporation which was ratified by Loral’s stockholders on May 19, 2009). Diluted earnings per share are based on the weighted average number of shares of voting and non-voting common stock outstanding during each period, adjusted for the effect of unconverted restricted stock units. For diluted earnings per share, earnings are adjusted for the dilutive effect of Telesat stock options and restricted share units. Recent Accounting Pronouncements In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2019- 12, Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes Additional Cash Flow Information The following represents non-cash activities and supplemental information to the condensed consolidated statements of cash flows (in thousands): Three Months Ended March 31, 2021 2020 Non-cash operating items: Equity in net (income) loss of affiliates $ (34,602) $ 117,074 Deferred taxes (562) 1,569 Depreciation and amortization 1 1 Right-of-use asset, net of lease liability (3) (1) Amortization of prior service credit and actuarial loss 399 302 Net non-cash operating items $ (34,767) $ 118,945 Supplemental information: Interest paid $ 6 $ 5 Income tax refunds $ 2 $ 178 Income tax payments $ 63 $ 63 |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 3 Months Ended |
Mar. 31, 2021 | |
Accumulated Other Comprehensive Loss [Abstract] | |
Accumulated Other Comprehensive Loss | 3. Accumulated Other Comprehensive Loss The components of accumulated other comprehensive loss, net of tax, are as follows (in thousands): Equity in Pension and Telesat-related Accumulated Other Other Other Post-retirement Comprehensive Comprehensive Benefits Loss Loss Balance, January 1, 2020 $ (16,167) $ (38,747) $ (54,914) Other comprehensive loss before reclassification (3,852) (14,232) (18,084) Amounts reclassified from accumulated other comprehensive loss 1,026 — 1,026 Net current-period other comprehensive loss (2,826) (14,232) (17,058) Balance, December 31, 2020 (18,993) (52,979) (71,972) Other comprehensive loss before reclassification — (2,131) (2,131) Amounts reclassified from accumulated other comprehensive loss 315 — 315 Net current-period other comprehensive loss 315 (2,131) (1,816) Balance, March 31, 2021 $ (18,678) $ (55,110) $ (73,788) The components of other comprehensive income (loss) and related tax effects are as follows (in thousands): Three Months Ended March 31, 2021 2020 Before-Tax Tax (Provision) Net-of-Tax Before-Tax Tax Net-of-Tax Amount Benefit Amount Amount Provision Amount Amortization of prior service credits and net actuarial loss $ 399 (a) $ (84) $ 315 $ 302 (a) $ (63) $ 239 Equity in Telesat-related other comprehensive (loss) income (2,133) 2 (2,131) 31,063 (12) 31,051 Other comprehensive (loss) income $ (1,734) $ (82) $ (1,816) $ 31,365 $ (75) $ 31,290 (a) Reclassifications are included in other expense. |
Other Current Assets
Other Current Assets | 3 Months Ended |
Mar. 31, 2021 | |
Other Current Assets [Abstract] | |
Other Current Assets | 4. Other Current Assets Other current assets consists of (in thousands): March 31, December 31, 2021 2020 Restricted cash (see Note 2) $ 304 $ 304 Indemnification receivable from SSL for pre-closing taxes (see Note 13) 598 598 Due from affiliates 59 88 Prepaid expenses 838 240 Other 2 2 $ 1,801 $ 1,232 |
Investments in Affiliates
Investments in Affiliates | 3 Months Ended |
Mar. 31, 2021 | |
Investments in Affiliates [Abstract] | |
Investments in Affiliates | 5. Investments in Affiliates Investments in affiliates consist of (in thousands): March 31, December 31, 2021 2020 Telesat $ 225,133 $ 192,664 Equity in net income (loss) of affiliates consists of (in thousands): Three Months Ended March 31, 2021 2020 Telesat $ 34,602 $ (117,074) Telesat As of March 31, 2021 and December 31, 2020, we held a 62.6% economic interest and a 32.6% voting interest in Telesat. We use the equity method of accounting for our majority economic interest in Telesat because we own 32.6% of the voting stock and do not exercise control by other means to satisfy the U.S. GAAP requirement for treatment as a consolidated subsidiary. We have also concluded that Telesat is not a variable interest entity for which we are the primary beneficiary. Loral’s equity in net income or loss of Telesat is based on our proportionate share of Telesat’s results in accordance with U.S. GAAP and in U.S. dollars. Our proportionate share of Telesat’s net income or loss is based on our economic interest as our holdings consist of common stock and non-voting participating preferred shares that have all the rights of common stock with respect to dividends, return of capital and surplus distributions, but have no voting rights. In addition to recording our share of equity in net income of Telesat, we also recorded our share of equity in other comprehensive loss of Telesat of $2.1 million for the three months ended March 31, 2021. The ability of Telesat to pay dividends or certain other restricted payments in cash to Loral is governed by applicable covenants in Telesat’s debt and shareholder agreements. Telesat’s credit agreement governing its senior secured credit facilities limits, among other items, Telesat’s ability to incur debt and make dividend payments if the total leverage ratio (“Total Leverage Ratio”) is above 4.50:1.00, with certain exceptions. As of March 31, 2021, Telesat’s Total Leverage Ratio was 4.38:1.00. Telesat is permitted to pay annual consulting fees of $5.0 million to Loral in cash under a consulting agreement which expires in October 2021 (see Note 14). On April 27, 2021 , Telesat issued $500 million in aggregate principal amount of 5.625% senior secured notes maturing on December 6, 2026 (the “ 5.625% Senior Secured Notes”). Interest on the 5.625% Senior Secured Notes will be payable on June 1 and December 1 of each year, commencing on December 1, 2021, to holders of record on the immediately preceding May 15 or November 15, as the case may be. The 5.625% Senior Secured Notes indenture includes covenants and terms that restrict Telesat’s ability to, among other things, incur additional indebtedness, incur liens, pay dividends or make certain other restricted payments, investments or acquisitions, enter into certain transactions with affiliates, modify or cancel its satellite insurance, effect mergers with another entity, and redeem the 5.625% Senior Secured Notes, without penalty, before December 6, 2022, in each case subject to exceptions provided in the 5.625% Senior Secured Notes indenture. In April 2021, Telesat cancelled 6,197,776 issued and outstanding vested and unvested stock options. In April 2021, Telesat approved the adoption of a restricted share unit (“Telesat RSU”) plan. A total of 3,660,000 non-voting participating preferred shares are reserved for issuance upon vesting of the Telesat RSUs awarded under the Telesat RSU plan, provided that the aggregate number of non-voting participating preferred shares issuable under the Telesat RSU plan (and under all other share compensation arrangements) does not exceed 10% of the total number of non-voting participating preferred shares outstanding from time to time (on a non-diluted basis) . In April 2021, 3,530,000 Telesat RSUs were granted under the Telesat RSU plan with 130,000 Telesat RSUs remaining available for grant under the Telesat RSU plan. The following table presents summary financial data for Telesat in accordance with U.S. GAAP as of March 31, 2021 and December 31, 2020 and for the three months ended March 31, 2021 and 2020 (in thousands): March 31, December 31, 2021 2020 Balance Sheet Data: Current assets $ 759,747 $ 703,210 Total assets 4,018,684 3,943,875 Current liabilities 157,117 129,849 Long-term debt 2,483,716 2,483,256 Total liabilities 3,158,126 3,140,747 Shareholders’ equity 860,558 803,128 Three Months Ended March 31, 2021 2020 Statement of Operations Data: Revenues $ 150,054 $ 158,565 Operating expenses (31,540) (35,316) Depreciation and amortization (42,713) (45,417) Other operating expense (495) (167) Operating income 75,306 77,665 Interest expense (33,100) (41,547) Foreign exchange gain (loss) 27,427 (221,643) Gain (loss) on financial instruments 1,585 (7,005) Other (loss) income (797) 3,539 Income tax (provision) benefit (16,910) 682 Net income (loss) $ 53,511 $ (188,309) Other We own 56% of the ordinary membership interests of XTAR, a joint venture between us and Hisdesat Servicios Estrategicos, S.A. (“Hisdesat”) of Spain. Hisdesat owns the remaining 44% of the ordinary membership interests and all of XTAR’s Class A membership interests, which have liquidation priority over the ordinary membership interests. We account for our ownership interest in XTAR under the equity method of accounting because we do not control certain of its significant operating decisions. We have also concluded that XTAR is not a variable interest entity for which we are the primary beneficiary. As of March 31, 2021 and December 31, 2020, the carrying value of our investment in XTAR was zero. Beginning January 1, 2016, we discontinued providing for our allocated share of XTAR’s net losses as our investment was reduced to zero and we have no commitment to provide further financial support to XTAR. Prior to July 1, 2020, XTAR owned and operated an X-band satellite, XTAR–EUR (the “Satellite”) located at the 29° E.L. orbital slot (the “Orbital Slot”). In addition, prior to July 1, 2020, XTAR leased from Hisdesat 7.2 72MHz X-band transponders on the Spainsat satellite located at 30° W.L. (the “Transponder Lease”). On July 1, 2020, Loral, XTAR and Hisdesat restructured their relationship, including, among other things, the following: (i) Hisdesat purchased the Satellite and certain assets related to operation of the Satellite (the “Purchased Assets”) from XTAR; (ii) XTAR’s agreement with Hisdesat to operate the Satellite at the Orbital Slot was terminated and the rights and licenses to operate the Satellite at the Orbital Slot reverted to Hisdesat; (iii) the Transponder Lease was terminated; (iv) XTAR and Hisdesat entered into an agreement under which XTAR will continue to market and sell capacity on the Satellite and on the Spainsat satellite; (v) XTAR and Loral terminated the management agreement between them (the “Loral Management Agreement”) under which, until December 31, 2013, XTAR was charged a quarterly management fee for services provided by Loral; and (vi) Loral granted to Hisdesat an option to acquire for nominal consideration, subject to receipt of all required regulatory approvals, Loral’s membership interests in XTAR. As of the date of this report, Hisdesat has not exercised this option. On July 2, 2020, Loral received from XTAR $5.9 million from the proceeds of the sale of the Purchased Assets in full and final settlement of the past due receivable outstanding of $6.6 million under the Loral Management Agreement. As of March 31, 2021 and December 31, 2020, the Company also held an indirect ownership interest in GdM which currently serves as the exclusive service provider for Globalstar service in Mexico. The Company accounts for this ownership interest using the equity method of accounting. As of March 31, 2021 and December 31, 2020, the carrying value of this investment was zero. Loral has written-off its investment in this company and has no future funding requirements relating to this investment. Accordingly, there is no requirement for us to provide for our allocated share of GdM’s net losses. GdM is currently in the process of dissolution and liquidation in Mexico, and Loral believes that it will not have any liability associated with GdM upon completion of this process. |
Other Current Liabilities
Other Current Liabilities | 3 Months Ended |
Mar. 31, 2021 | |
Other Current Liabilities [Abstract] | |
Other Current Liabilities | 6. Other Current Liabilities Other current liabilities consists of (in thousands): March 31, December 31, 2021 2020 Operating lease liability $ 470 $ 345 Due to affiliate 198 98 Accrued professional fees 1,163 1,287 Pension and other post-retirement liabilities 83 82 Income tax payable 34 — Accrued liabilities 232 190 $ 2,180 $ 2,002 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2021 | |
Income Taxes [Abstract] | |
Income Taxes | 7. Income Taxes The following summarizes our income tax benefit (provision) (in thousands): Three Months Ended March 31, 2021 2020 Current income tax provision $ (340) $ (547) Deferred income tax benefit (provision) 562 (1,569) Income tax benefit (provision) $ 222 $ (2,116) For the three-month periods ended March 31, 2021 and 2020, our income tax benefit (provision) is computed by applying an expected effective annual tax rate against the pre-tax results for each period (after adjusting for certain tax items that are discrete to each period). The current income tax provision for each period includes our anticipated income tax liability related to GILTI from Telesat and our provision for UTPs. After utilizing our net operating loss (“NOL”) carryforwards and allowable tax credits, federal income tax on GILTI from Telesat was zero for each period. The deferred income tax benefit (provision) for each period includes the impact of equity in net income (loss) of affiliates from our condensed consolidated statement of operations and the periodic effect of our accounting for GILTI. For the three months ended March 31. 2020, our deferred provision included a benefit of $3.1 million from the Coronavirus Aid, Relief, and Economic Security Act which was signed into law on March 27, 2020. Since our deferred tax assets related to the investment in Telesat will be realized from the future recognition of GILTI, the federal portion of these deferred tax assets was valued at zero as of March 31, 2021 and December 31, 2020. To the extent that profitability from operations is not sufficient to realize the benefit from our remaining net deferred tax assets, we would generate sufficient taxable income from the appreciated value of our Telesat investment, subject to the provisions of the Transaction Agreement, in order to prevent federal NOLs from expiring and realize the benefit of all remaining deferred tax assets. The following summarizes amounts for UTPs included in our income tax benefit (provision) (in thousands): Three Months Ended March 31, 2021 2020 Current provision for UTPs $ (245) $ (476) Deferred benefit for UTPs 9 100 Tax provision for UTPs $ (236) $ (376) As of March 31, 2021, we had unrecognized tax benefits relating to UTPs of $43 million. The Company recognizes interest and penalties related to income taxes in income tax expense on a quarterly basis. As of March 31, 2021, we have accrued no penalties and approximately $3.6 million for the potential payment of tax-related interest. With few exceptions, the Company is no longer subject to U.S. federal, state or local income tax examinations by tax authorities for years prior to 2014. Earlier years related to certain foreign jurisdictions remain subject to examination. To the extent allowed by law, the tax authorities may have the right to examine prior periods where NOLs were generated and carried forward, and make adjustments up to the amount of the NOL carryforward. While we intend to contest any future tax assessments for uncertain tax positions, no assurance can be provided that we would ultimately prevail. During 2021, the statute of limitations for assessment of additional tax will expire with regard to certain UTPs, potentially resulting in a $16.4 million reduction to our unrecognized tax benefits. Pursuant to the purchase agreement for the sale of SSL, we are obligated to indemnify SSL for certain taxes related to periods prior to the closing of the transaction. As of March 31, 2021, if our positions are sustained by the taxing authorities, the Company’s income tax provision would be reduced by approximately $8.7 million. Other than as described above, we anticipate no other significant changes to our unrecognized tax benefits during the next twelve months. |
Other Liabilities
Other Liabilities | 3 Months Ended |
Mar. 31, 2021 | |
Other Liabilities [Abstract] | |
Other Liabilities | 8. Other Liabilities Other liabilities consists of (in thousands): March 31, December 31, 2021 2020 Indemnification liabilities - other (see Note 13) $ 145 $ 145 Liabilities for uncertain tax positions 20,014 19,769 $ 20,159 $ 19,914 |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2021 | |
Stock-Based Compensation [Abstract] | |
Stock-Based Compensation | 9. Stock-Based Compensation Stock Plans The Loral amended and restated 2005 stock incentive plan (the “Stock Incentive Plan”) which allowed for the grant of several forms of stock-based compensation awards including stock options, stock appreciation rights, restricted stock, restricted stock units, stock bonuses and other stock-based awards, had a ten-year term and has expired. As of March 31, 2021 and 2020, outstanding and unconverted restricted stock units (“RSUs”) were 98,917 and 75,262, respectively, that are vested and do not expire. During 2020, we paid special dividends of $7.00 per share for an aggregate dividend amount of $216.5 million (see Note 2). In accordance with Loral’s Stock Incentive Plan, an equitable adjustment was made to outstanding stock-based awards to reflect the cash dividend. As a result, RSUs outstanding under the Stock Incentive Plan increased by 23,655 during 2020. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2021 | |
Net income per share: | |
Earnings Per Share | 10. Earnings Per Share Telesat has awarded employee stock options, which, if exercised, would result in dilution of Loral’s economic ownership interest in Telesat from 62.6% to approximately 62.4%. The following table presents the dilutive impact of Telesat stock options on Loral’s reported net income for the purpose of computing diluted earnings per share (in thousands): Three Months Ended March 31, 2021 Net income — basic $ 30,716 Less: Adjustment for dilutive effect of Telesat stock options (155) Net income — diluted $ 30,561 Telesat stock options are excluded from the calculation of diluted loss per share for the three months ended March 31, 2020 as the effect would be antidilutive. Basic income per share is computed based upon the weighted average number of share of voting and non-voting common stock outstanding. The following is the computation of common shares outstanding for diluted earnings per share (in thousands): Three Months Ended March 31, 2021 Weighted average common shares outstanding 30,933 Unconverted restricted stock units 99 Common shares outstanding for diluted earnings per share 31,032 For the three months ended March 31, 2020, the following unconverted restricted stock units are excluded from the calculation of diluted loss per share as the effect would have been antidilutive (in thousands): Three Months Ended March 31, 2020 Unconverted restricted stock units 75 |
Pensions and Other Employee Ben
Pensions and Other Employee Benefit Plans | 3 Months Ended |
Mar. 31, 2021 | |
Pensions and Other Employee Benefit Plans [Abstract] | |
Pensions and Other Employee Benefit Plans | 11. Pensions and Other Employee Benefit Plans The following table provides the components of net periodic cost for our qualified retirement plan (the “Pension Benefits”) and health care and life insurance benefits for retired employees and dependents (the “Other Benefits”) for the three months ended March 31, 2021 and 2020 (in thousands): Pension Benefits Other Benefits Three Months Ended Three Months Ended March 31, March 31, 2021 2020 2021 2020 Service cost (1) $ 187 $ 181 $ — $ — Interest cost (2) 375 440 3 4 Expected return on plan assets (2) (688) (669) — — Amortization of net actuarial loss (gain) (2) 399 303 — (1) Net periodic cost $ 273 $ 255 $ 3 $ 3 (1) Included in general and administrative expenses. (2) Included in other expense. |
Financial Instruments, Derivati
Financial Instruments, Derivative Instruments and Hedging | 3 Months Ended |
Mar. 31, 2021 | |
Financial Instruments, Derivative Instruments and Hedging [Abstract] | |
Financial Instruments, Derivative Instruments and Hedging | 12. Financial Instruments, Derivative Instruments and Hedging Financial Instruments The carrying amount of cash equivalents approximates fair value because of the short maturity of those instruments. Foreign Currency We are subject to the risks associated with fluctuations in foreign currency exchange rates. To limit this foreign exchange rate exposure, we attempt to denominate all contracts in U.S. dollars. Where appropriate, derivatives are used to minimize the risk of foreign exchange rate fluctuations to operating results and cash flows. We do not use derivative instruments for trading or speculative purposes. Derivatives and Hedging Transactions There were no derivative instruments as of March 31, 2021 and December 31, 2020. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | 13. Commitments and Contingencies Financial Matters In 2012, we sold our former subsidiary, SSL, to MDA Communications Holdings, Inc., a subsidiary of Maxar Technologies Inc. In connection with the sale in 2008 by Loral and certain of its subsidiaries and DASA Globalstar LLC to Globalstar Inc. of their respective interests in GdB, the Globalstar Brazilian service provider, Loral agreed to indemnify Globalstar Inc. and GdB for certain GdB pre-closing liabilities, primarily related to Brazilian taxes. Our condensed consolidated balance sheets include liabilities of $0.1 million as of March 31, 2021 and December 31, 2020 for indemnification liabilities relating to the sale of GdB. See Note 14 — Related Party Transactions — Transactions with Affiliates — Telesat Lease Arrangements We lease a facility and certain equipment under agreements expiring at various dates. We may renew, extend or modify the lease covering our facilities as needed. In March 2021, the operating lease for our corporate offices was modified by extending the lease expiration date from June 30, 2021 to December 31, 2021 and decreasing the rent for the extension period. The facility lease modification was accounted for by remeasuring the lease liability and adjusting the carrying amount of the right-of-use asset by the amount of the remeasurement of the lease liability as of March 31, 2021. We have no sublease income in any of the periods presented. Lease costs expensed for the three months ended March 31, 2021 and 2020 were as follows (in thousands): Lease Expense Three months ended March 31, 2021 $ 174 Three months ended March 31, 2020 174 Lease payments for the three months ended March 31, 2021 were $0.2 million. The remaining lease term as of March 31, 2021 is nine months and we used a discount rate of 7.5% to compute the lease liability. The following is a reconciliation of the lease liability to future lease payments as of March 31, 2021 (in thousands): Operating lease payments - (April 1, 2021 to December 31, 2021) $ 481 Less: Future interest 11 Operating lease liability $ 470 Amounts recognized in Balance Sheet Other current liabilities $ 470 Legal Proceedings Litigation Related to the Transaction On May 5, 2021, Guy Coffman filed a complaint (Civil Action No. 1:21-cv-04007, the “Coffman Complaint”) in the United States District Court for the Southern District of New York against the Company and the members of our Board of Directors (the “Individual Defendants”). Also on May 5, 2021, Shiva Stein filed a complaint (Civil Action No. 1:21-cv-04018, the “Stein Complaint”) in the United States District Court for the Southern District of New York against the Company and the Individual Defendants. On May 7, 2021, Julia Marshall filed a complaint (Civil Action No. 1:21-cv-04128, the “Marshall Complaint” and, together with the Coffman Complaint and the Stein Complaint, the “Complaints”) in the United States District Court for the Southern District of New York against the Company, the Individual Defendants and Merger Sub (collectively, the “Loral Defendants”); the Marshall Complaint also names as defendants Telesat, Telesat Corporation, Telesat Partnership and Telesat CanHoldCo (together, the “Telesat Defendants”) and PSP and Red Isle (the “PSP Defendants” and, together with the Loral Defendants and the Telesat Defendants, the “Defendants”). The Complaints allege, among other things, that the Registration Statement on Form F-4 (the “Registration Statement”) filed in April 2021 with the SEC by Telesat Corporation and Telesat Partnership, which contained a preliminary proxy statement/prospectus of the Company for use in connection with soliciting stockholder approval of the Transaction, contained materially incomplete and misleading information. Specifically, the Complaints allege (i) violation by the Loral Defendants of Section 14(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and SEC Rule 14(a)(9) in that the Registration Statement misrepresents or omits information concerning, among other things, financial projections of Loral and financial analyses of Loral’s financial advisor, LionTree Advisors LLC; and (ii) violation by the Individual Defendants, by virtue of their positions as controlling persons of the Company, of Section 20(a) of the Exchange Act in that they had the power to influence and control, and did influence and control, directly or indirectly, the decision making of the Company, including the content and dissemination of the various statements that plaintiffs contend are materially incomplete and misleading. In addition, the Coffman Complaint alleges a violation of Delaware law in that the Individual Defendants breached their fiduciary duty of candor/disclosure by approving and/or causing the alleged materially deficient Registration Statement to be disseminated. The Marshall Complaint also alleges violation by the Telesat Defendants and the PSP Defendants, by virtue of their positions as controlling persons, of Section 20(a) of the Exchange Act in that they had supervisory control over the composition of the Registration Statement and the information disclosed therein, as well as the information that they claim was omitted and/or misrepresented in the Registration Statement. Each of the Complaints seeks, among other things, to enjoin Defendants from proceeding with, consummating or closing the Transaction, unless and until Defendants disclose the material information which plaintiffs claim has been omitted from the Registration Statement; awarding plaintiffs the costs and disbursements of their actions, including reasonable attorneys’ and expert fees and expenses; and such other and further equitable relief as the court may deem just and proper. In addition, the Coffman Complaint and the Stein Complaint seek that the Loral Defendants account to plaintiffs for all damages suffered as a result of their alleged wrongdoing. The Stein Complaint and the Marshall Complaint also seek rescission, to the extent already implemented, of the Transaction Agreement or any of the terms thereof, or granting to plaintiff rescissory damages. The Marshall Complaint also seeks a declaration that the Individual Defendants disseminate a Registration Statement that does not contain any untrue statements of material fact and that states all material facts required in it or necessary to make the statements contained therein not misleading and a declaration that Defendants violated Sections 14(a) and/or 20(a) of the Exchange Act, as well as Rule 14a-9 promulgated thereunder. The Loral Defendants believe that they have, and intend vigorously to pursue, meritorious defenses to plaintiffs’ claims. There can be no assurance, however, that the Loral Defendants’ defenses will be successful with respect to all or some of plaintiffs’ claims, that resolution of the lawsuits will not result in additional unanticipated expense to the Company or that the lawsuits filed by plaintiffs will not cause a delay in consummation of the Transaction. Although no assurance can be provided, we do not believe that this matter will have a material adverse effect on Loral’s financial position or results of operations or on Loral’s ability to consummate the Transaction. Other and Routine Litigation Other than as set forth above, we are not currently subject to any legal proceedings that, if decided adversely, could have a material adverse effect on our financial position or results of operations. In the future, however, we may become subject to legal proceedings and claims, either asserted or unasserted, that may arise in the ordinary course of business or otherwise. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 14. Related Party Transactions MHR Fund Management LLC Mark H. Rachesky, President and Chief Investment Officer of MHR Fund Management LLC (“MHR”), and Janet T. Yeung, a principal and the General Counsel of MHR, are members of Loral’s board of directors. Various funds affiliated with MHR and Dr. Rachesky held, as of March 31, 2021 and December 31, 2020, approximately 39.9% of the outstanding voting common stock and 58.4% of the combined outstanding voting and non-voting common stock of Loral. Transactions with Affiliates Telesat Recent Developments Transaction Agreement. Upon satisfaction of the terms and subject to the conditions set forth in the Transaction Agreement, the Transaction will result in the current stockholders of Loral, PSP and the other shareholders in Telesat (principally current or former management of Telesat) owning approximately the same percentage of equity in Telesat indirectly through Telesat Corporation and/or Telesat Partnership as they currently hold (indirectly in the case of Loral stockholders and PSP) in Telesat, Telesat Corporation becoming the publicly traded general partner of Telesat Partnership and Telesat Partnership indirectly owning all of the economic interests in Telesat, except to the extent that the other shareholders in Telesat elect to retain their direct interest in Telesat. The Transaction Agreement provides for certain economic adjustments and contractual protections with respect to Loral’s assets and liabilities other than its indirect interest in Telesat. These include among others: ● One Time Payment . To compensate PSP and Red Isle for certain tax inefficiencies for PSP and Red Isle related to the structure of the Transaction, Loral will make a payment of $7 million to Red Isle, subject to the extent of Loral’s available cash; however, if such payment is less than $7 million due to a lack of available cash, Telesat Partnership will be required to pay the balance of such unpaid amount to Red Isle no later than 35 trading days following consummation of the Transaction . ● Absolute Indemnities . Loral, Telesat Corporation and Telesat CanHoldco will indemnify PSP for PSP’s pro rata share of costs relating to: (a) certain losses and litigation proceedings related to the Transaction, (b) certain out-of-pocket expenses of Loral after the Closing and (c) certain tax matters. This indemnification will be (i) independent of the accuracy of the underlying representations and warranties, (ii) in the case of the tax indemnification, subject to a cap of $50 million and (iii) subject to additional, customary limitations. The Transaction Agreement also provides certain termination rights for both Loral and PSP and further provides that, in certain circumstances, Loral may be required to pay to Red Isle a termination fee of $6,550,000 or $22,910,000, or to pay to PSP a “breach” fee of $40,000,000, in each case as provided in the Transaction Agreement. In connection with the Transaction, Loral entered into the following agreements with related parties or their subsidiaries: Subscription Agreement for Series B Preferred Stock Full and Final Release and Amendment of Tolling Agreement Standstill Agreement Transaction. The MHR Standstill Agreement will terminate immediately upon the first to occur of the conclusion of the Loral stockholder meeting and termination of the Transaction Agreement. Ownership Interest. Shareholders Agreement. Under the Shareholders Agreement, in the event that, except in certain limited circumstances, either (i) ownership or control, directly or indirectly, by Dr. Rachesky of Loral’s voting stock falls below certain levels other than in connection with certain specified circumstances, including an acquisition by a Strategic Competitor (as defined in the Shareholders Agreement) or (ii) there is a change in the composition of a majority of the members of the Loral Board of Directors over a consecutive two-year period without the approval of the incumbent directors, Loral will lose its veto rights relating to certain extraordinary actions by Telesat and its subsidiaries. In addition, after either of these events, PSP will have certain rights to enable it to exit from its investment in Telesat, including a right to cause Telesat to conduct an initial public offering in which PSP’s shares would be the first shares offered or, if no such offering has occurred within one year due to a lack of cooperation from Loral or Telesat, to cause the sale of Telesat and to drag along the other shareholders in such sale, subject to Loral’s right to call PSP’s shares at fair market value. The Shareholders Agreement provides for a board of directors of Telesat consisting of 10 directors, three nominated by Loral, three nominated by PSP and four independent directors to be selected by a nominating committee comprised of one PSP nominee, one nominee of Loral and one of the independent directors then in office. Each party to the Shareholders Agreement is obligated to vote all of its Telesat shares for the election of the directors nominated by the nominating committee. Pursuant to action by the board of directors taken on October 31, 2007, Dr. Rachesky, who is non-executive Chairman of the Board of Directors of Loral, was appointed non-executive Chairman of the board of directors of Telesat. In addition, Michael B. Targoff, Loral’s Vice Chairman, serves on the board of directors of Telesat. Consulting Services Agreement. Tax Indemnification. Administrative Fee. Grant Agreements. The Goldberg Stock Option Grant Agreement documents a grant to Mr. Goldberg of Telesat stock options (including tandem SAR rights) and provides for certain rights, obligations and restrictions related to such stock options, which include, among other things: (w) the possible obligation of the Special Purchaser to purchase the shares in the place of Telesat should Telesat be prohibited by applicable law or under the terms of any credit agreement applicable to Telesat from purchasing such shares, or otherwise default on such purchase obligation, pursuant to the terms of the Goldberg Stock Option Grant Agreement; (x) the obligation of the Special Purchaser to purchase shares upon exercise by Telesat of its call right under Telesat’s Management Stock Incentive Plan in the event of Mr. Goldberg’s termination of employment; (y) the right of Mr. Goldberg to require the Special Purchaser or Loral to purchase a portion of the shares in Telesat owned by him in the event of exercise after termination of employment to cover taxes that are greater than the minimum withholding amount; and (z) the right of Mr. Goldberg to require Telesat to cause the Special Purchaser or Loral to purchase a portion of the shares in Telesat owned by him, or that are issuable to him under Telesat’s Management Stock Incentive Plan at the relevant time, in the event that more than 90% of Loral’s common stock is acquired by an unaffiliated third party that does not also purchase all of PSP’s and its affiliates’ interest in Telesat. Under an option cancellation agreement between Telesat and Mr. Goldberg, 220,000 options under the Goldberg Stock Option Agreement were cancelled, with the balance of the options under that agreement remaining outstanding. The Goldberg RSU Grant Agreement documents a grant to Mr. Goldberg of restricted stock units with respect to shares in Telesat and provides for certain rights, obligations and restrictions related to such restricted stock units, which include, among other things: (x) the possible obligation of the Special Purchaser to purchase the shares in the place of Telesat should Telesat be prohibited by applicable law or under the terms of any credit agreement applicable to Telesat from purchasing such shares, or otherwise default on such purchase obligation, pursuant to the terms of the Goldberg RSU Grant Agreement; and (y) the obligation of the Special Purchaser to purchase shares upon exercise by Telesat of its call right under Telesat’s Management Stock Incentive Plan in the event of the termination of Mr. Goldberg’s employment. The 2021 RSU Grant Agreements document grants to the Participants of restricted share units with respect to shares in Telesat and provide for certain rights, obligations and restrictions related to such restricted share units, which include, among other things, the obligation of the Special Purchaser, prior to the occurrence of the Transaction, to purchase Telesat shares upon exercise by Telesat of its call right under Telesat’s Restricted Share Unit Plan in the event of the termination of a Participant’s employment. The Goldberg Stock Option Grant Agreement and the RSU Grant Agreements further provide that, in the event the Special Purchaser is required to purchase Telesat shares pursuant to such agreements, such shares, together with the obligation to pay for such shares, shall be transferred to a subsidiary of the Special Purchaser, which subsidiary shall be wound up into Telesat, with Telesat agreeing to the acquisition of such subsidiary by Telesat from the Special Purchaser for nominal consideration and with the purchase price for the shares being paid by Telesat within ten (10) business days after completion of the winding-up of such subsidiary into Telesat. Other than the stock options that remain outstanding under the Goldberg Stock Option Grant Agreement as discussed above, stock options to purchase shares in Telesat previously granted by Telesat to certain Telesat executives (Messrs. Goldberg, Browne, Hudson and Schwartz) and a former Telesat executive (Mr. Cayouette) under stock option grant agreements among Telesat, such Telesat executives or former executive, PSP, Loral and the Special Purchaser have been either exercised for Telesat shares or cancelled, and, accordingly, neither Loral nor the Special Purchaser has any further obligations under those agreements. Other We of the ordinary membership interests of XTAR, a joint venture between Loral and Hisdesat and account for our investment in XTAR under the equity method of accounting. On July 1, 2020, Loral, XTAR and Hisdesat restructured their relationship (see Note 5). As part of the restructuring, XTAR and Loral terminated the Loral Management Agreement pursuant to which Loral provided general and specific services of a technical, financial and administrative nature to XTAR. For the services provided by Loral, XTAR, until December 31, 2013, was charged a quarterly management quarterly gross revenues. Amounts due to Loral at the time of the restructuring, primarily due to the Loral Management Agreement, and we had an against these receivables. On July 2, 2020, Loral received from XTAR $5.9 million in full and final settlement of the past due receivable outstanding of $6.6 million under the Loral Management Agreement. As of March 31, 2021 and December 31, 2020, Loral had a receivable of $0.1 million from XTAR. Consulting Agreement On December 14, 2012, Loral entered into a consulting agreement with Michael B. Targoff, Vice Chairman of the Company and former Chief Executive Officer and President. Pursuant to this agreement, Mr. Targoff is engaged as a part-time consultant to the Board to assist the Board with respect to the oversight of strategic matters relating to Telesat and XTAR. Under the agreement, Mr. Targoff receives consulting fees of $120,000 per month and reimburses the Company for certain expenses. For each of the three-month periods ended March 31, 2021 and 2020, Mr. Targoff earned $360,000 in consulting fees and reimbursed Loral net expenses of $11,250. |
Basis of Presentation (Policy)
Basis of Presentation (Policy) | 3 Months Ended |
Mar. 31, 2021 | |
Basis of Presentation [Abstract] | |
Investments in Affiliates | Investments in Affiliates Our ownership interest in Telesat is accounted for using the equity method of accounting under U.S. GAAP. Telesat’s financial statements are prepared in accordance with international financial reporting standards (“IFRS”). To allow our reporting of our investment in Telesat under U.S. GAAP, Telesat provides us with a reconciliation of its financial statements from IFRS to U.S. GAAP. Income and losses of Telesat are recorded based on our economic interest. The contribution of Loral Skynet, a wholly owned subsidiary of Loral prior to its contribution to Telesat in 2007, was recorded by Loral at the historical book value of our retained interest combined with the gain recognized on the contribution. However, the contribution was recorded by Telesat at fair value. Accordingly, the amortization of Telesat fair value adjustments applicable to the Loral Skynet assets and liabilities acquired by Telesat in 2007 is proportionately eliminated in determining our share of the net income of Telesat. Our equity in net income or loss of Telesat also reflects amortization of profits eliminated, to the extent of our economic interest in Telesat, on satellites we constructed for Telesat while we owned Space Systems/Loral, LLC (formerly known as Space Systems/Loral, Inc.) (“SSL”) and on Loral’s sale to Telesat in April 2011 of its portion of the payload on the ViaSat-1 satellite and related assets. Non-refundable cash distributions received from Telesat in excess of our initial investment and our share of cumulative equity in comprehensive income of Telesat, net of cash distributions received in prior periods, are recorded as equity in net income of Telesat (“Excess Cash Distribution”) since we have no obligation to provide future financial support to Telesat. After receiving an Excess Cash Distribution, we do not record additional equity in net income of Telesat until our share of Telesat’s future net income exceeds the Excess Cash Distribution. Equity in losses of affiliates is not recognized after the carrying value of an investment, including advances and loans, has been reduced to zero, unless guarantees or other funding obligations exist. We had no guarantees or other funding obligations for our equity method investments as of March 31, 2021 and December 31, 2020. We use the nature of distribution approach to classify distributions from equity method investments on the statements of cash flows. The Company monitors its equity method investments for factors indicating other-than-temporary impairment. An impairment loss is recognized when there has been a loss in value of the affiliate that is other-than-temporary. |
Use of Estimates in Preparation of Financial Statements | Use of Estimates in Preparation of Financial Statements The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the amount of income (loss) reported for the period. Actual results could materially differ from estimates. Significant estimates also included the allowances for doubtful accounts, income taxes, including the valuation of deferred tax assets, the fair value of liabilities indemnified, the dilutive effect of Telesat stock options (see Note 10) and our pension liabilities. |
Cash, Cash Equivalents and Restricted Cash | Cash, Cash Equivalents and Restricted Cash As of March 31, 2021, the Company had $25.5 million of cash and cash equivalents. Cash and cash equivalents include liquid investments, primarily money market funds, with maturities of less than 90 days at the time of purchase. Management determines the appropriate classification of its investments at the time of purchase and at each balance sheet date. On April 30, 2020, the Company’s Board of Directors declared a special dividend of $5.50 per share for an aggregate dividend of approximately $170.1 million. The special dividend was paid on May 28, 2020 to holders of record of Loral voting and non-voting common stock as of the close of business on May 14, 2020. On November 23, 2020, the Company’s Board of Directors declared a special dividend of $1.50 per share for an aggregate dividend of approximately $46.4 million. The special dividend was paid on December 17, 2020 to holders of record of Loral voting and non-voting common stock as of the close of business on December 4, 2020. As of March 31, 2021 and December 31, 2020, the Company had restricted cash of $0.3 million, representing the amount pledged as collateral to the issuer of a standby letter of credit (the “LC”). The LC, which expires in February 2022, has been provided as a guaranty to the lessor of our corporate offices. The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheet to the condensed consolidated statement of cash flows (in thousands): March 31, December 31, 2021 2020 Cash and cash equivalents $ 25,460 $ 31,631 Restricted cash included in other current assets 304 304 Cash, cash equivalents and restricted cash shown in the statement of cash flows $ 25,764 $ 31,935 |
Concentration of Credit Risk | Concentration of Credit Risk Financial instruments which potentially subject us to concentrations of credit risk consist principally of cash and cash equivalents and receivables. Our cash and cash equivalents are maintained with high-credit-quality financial institutions. As of March 31, 2021 and December 31, 2020, our cash and cash equivalents were invested primarily in two liquid government AAA money market funds. Such funds are not insured by the Federal Deposit Insurance Corporation. The dispersion across funds reduces the exposure of a default at any one fund. As a result, management believes that its potential credit risks are minimal. |
Fair Value Measurements | Fair Value Measurements U.S. GAAP defines fair value as the price that would be received for an asset or the exit price that would be paid to transfer a liability in the principal or most advantageous market in an orderly transaction between market participants. U.S. GAAP also establishes a fair value hierarchy that gives the highest priority to observable inputs and the lowest priority to unobservable inputs. The three levels of the fair value hierarchy are described below: Level 1: Level 2: Level 3: Assets and Liabilities Measured at Fair Value The following table presents our assets and liabilities measured at fair value on a recurring and non-recurring basis (in thousands): March 31, 2021 December 31, 2020 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Assets Cash and cash equivalents: Money market funds $ 22,167 $ — $ — $ 29,166 $ — $ — Other current assets: Indemnification - Sale of SSL — — 598 — — 598 Liabilities Other liabilities: Indemnification - Globalstar do Brasil S.A. $ — $ — $ 145 $ — $ — $ 145 The carrying amount of money market funds approximates fair value as of each reporting date because of the short maturity of those instruments. The Company did not have any non-financial assets or non-financial liabilities that were recognized or disclosed at fair value as of March 31, 2021 and December 31, 2020. Assets and Liabilities Measured at Fair Value on a Non-recurring Basis We review the carrying values of our equity method investments when events and circumstances warrant and consider all available evidence in evaluating when declines in fair value are other-than-temporary. The fair values of our investments are determined based on valuation techniques using the best information available and may include quoted market prices, market comparables and discounted cash flow projections. An impairment charge is recorded when the carrying amount of the investment exceeds its current fair value and is determined to be other-than-temporary. The asset resulting from the indemnification of SSL is for certain pre-closing taxes and reflects the excess of payments since inception over refunds and the estimated liability, which was originally determined using the fair value objective approach. The estimated liability for indemnifications relating to Globalstar do Brasil S.A. (“GdB”), originally determined using expected value analysis, is net of payments since inception. |
Contingencies | Contingencies Contingencies by their nature relate to uncertainties that require management to exercise judgment both in assessing the likelihood that a liability has been incurred as well as in estimating the amount of potential loss, if any. We accrue for costs relating to litigation, claims and other contingent matters when such liabilities become probable and reasonably estimable. Such estimates may be based on advice from third parties or on management’s judgment, as appropriate. Actual amounts paid may differ from amounts estimated, and such differences will be charged to operations in the period in which the final determination of the liability is made. |
Income Taxes | Income Taxes Loral and its subsidiaries are subject to U.S. federal, state and local income taxation on their worldwide income and foreign taxation on certain income from sources outside the United States. Telesat is subject to tax in Canada and other jurisdictions, and Loral will provide in each period any additional U.S. current and deferred tax required on actual or deemed distributions from Telesat, including Global Intangible Low Taxed Income (“GILTI”). Deferred income taxes reflect the future tax effect of temporary differences between the carrying amount of assets and liabilities for financial and income tax reporting and are measured by applying anticipated statutory tax rates in effect for the year during which the differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance to the extent it is more likely than not that the deferred tax assets will not be realized. The tax benefit of an uncertain tax position (“UTP”) taken or expected to be taken in income tax returns is recognized only if it is “more likely than not” to be sustained on examination by the taxing authorities, based on its technical merits as of the reporting date. The tax benefit recognized in the financial statements from such a position is measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. The Company recognizes interest and penalties related to income taxes in income tax expense on a quarterly basis. The unrecognized tax benefit of a UTP is recognized in the period when the UTP is effectively settled. Previously recognized tax positions are derecognized in the first period in which it is no longer more likely than not that the tax position would be sustained upon examination. |
Earnings Per Share | Earnings per Share Basic earnings per share are computed based upon the weighted average number of shares of voting and non-voting common stock outstanding during each period. Shares of non-voting common stock are in all respects identical to and treated equally with shares of voting common stock except for the absence of voting rights (other than as provided in Loral’s Amended and Restated Certificate of Incorporation which was ratified by Loral’s stockholders on May 19, 2009). Diluted earnings per share are based on the weighted average number of shares of voting and non-voting common stock outstanding during each period, adjusted for the effect of unconverted restricted stock units. For diluted earnings per share, earnings are adjusted for the dilutive effect of Telesat stock options and restricted share units. |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Basis of Presentation [Abstract] | |
Reconciliation of Cash, Cash Equivalents and Restricted Cash | The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the condensed consolidated balance sheet to the condensed consolidated statement of cash flows (in thousands): March 31, December 31, 2021 2020 Cash and cash equivalents $ 25,460 $ 31,631 Restricted cash included in other current assets 304 304 Cash, cash equivalents and restricted cash shown in the statement of cash flows $ 25,764 $ 31,935 |
Assets and Liabilities Measured at Fair Value on Recurring and Non-Recurring basis | The following table presents our assets and liabilities measured at fair value on a recurring and non-recurring basis (in thousands): March 31, 2021 December 31, 2020 Level 1 Level 2 Level 3 Level 1 Level 2 Level 3 Assets Cash and cash equivalents: Money market funds $ 22,167 $ — $ — $ 29,166 $ — $ — Other current assets: Indemnification - Sale of SSL — — 598 — — 598 Liabilities Other liabilities: Indemnification - Globalstar do Brasil S.A. $ — $ — $ 145 $ — $ — $ 145 |
Additional Cash Flow Information | The following represents non-cash activities and supplemental information to the condensed consolidated statements of cash flows (in thousands): Three Months Ended March 31, 2021 2020 Non-cash operating items: Equity in net (income) loss of affiliates $ (34,602) $ 117,074 Deferred taxes (562) 1,569 Depreciation and amortization 1 1 Right-of-use asset, net of lease liability (3) (1) Amortization of prior service credit and actuarial loss 399 302 Net non-cash operating items $ (34,767) $ 118,945 Supplemental information: Interest paid $ 6 $ 5 Income tax refunds $ 2 $ 178 Income tax payments $ 63 $ 63 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Accumulated Other Comprehensive Loss [Abstract] | |
Components of Accumulated Other Comprehensive Loss | The components of accumulated other comprehensive loss, net of tax, are as follows (in thousands): Equity in Pension and Telesat-related Accumulated Other Other Other Post-retirement Comprehensive Comprehensive Benefits Loss Loss Balance, January 1, 2020 $ (16,167) $ (38,747) $ (54,914) Other comprehensive loss before reclassification (3,852) (14,232) (18,084) Amounts reclassified from accumulated other comprehensive loss 1,026 — 1,026 Net current-period other comprehensive loss (2,826) (14,232) (17,058) Balance, December 31, 2020 (18,993) (52,979) (71,972) Other comprehensive loss before reclassification — (2,131) (2,131) Amounts reclassified from accumulated other comprehensive loss 315 — 315 Net current-period other comprehensive loss 315 (2,131) (1,816) Balance, March 31, 2021 $ (18,678) $ (55,110) $ (73,788) |
Schedule of Other Comprehensive Income (Loss) and Related Income Tax Effects | The components of other comprehensive income (loss) and related tax effects are as follows (in thousands): Three Months Ended March 31, 2021 2020 Before-Tax Tax (Provision) Net-of-Tax Before-Tax Tax Net-of-Tax Amount Benefit Amount Amount Provision Amount Amortization of prior service credits and net actuarial loss $ 399 (a) $ (84) $ 315 $ 302 (a) $ (63) $ 239 Equity in Telesat-related other comprehensive (loss) income (2,133) 2 (2,131) 31,063 (12) 31,051 Other comprehensive (loss) income $ (1,734) $ (82) $ (1,816) $ 31,365 $ (75) $ 31,290 (a) Reclassifications are included in other expense. |
Other Current Assets (Tables)
Other Current Assets (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Other Current Assets [Abstract] | |
Schedule of Other Current Assets | Other current assets consists of (in thousands): March 31, December 31, 2021 2020 Restricted cash (see Note 2) $ 304 $ 304 Indemnification receivable from SSL for pre-closing taxes (see Note 13) 598 598 Due from affiliates 59 88 Prepaid expenses 838 240 Other 2 2 $ 1,801 $ 1,232 |
Investments in Affiliates (Tabl
Investments in Affiliates (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Investments in and Advances to Affiliates [Line Items] | |
Investments in Affiliates | Investments in affiliates consist of (in thousands): March 31, December 31, 2021 2020 Telesat $ 225,133 $ 192,664 |
Equity in Net (Loss) Income of Affiliates | Equity in net income (loss) of affiliates consists of (in thousands): Three Months Ended March 31, 2021 2020 Telesat $ 34,602 $ (117,074) |
Telesat Canada [Member] | |
Investments in and Advances to Affiliates [Line Items] | |
Summary Financial Data, Equity Method Investment | The following table presents summary financial data for Telesat in accordance with U.S. GAAP as of March 31, 2021 and December 31, 2020 and for the three months ended March 31, 2021 and 2020 (in thousands): March 31, December 31, 2021 2020 Balance Sheet Data: Current assets $ 759,747 $ 703,210 Total assets 4,018,684 3,943,875 Current liabilities 157,117 129,849 Long-term debt 2,483,716 2,483,256 Total liabilities 3,158,126 3,140,747 Shareholders’ equity 860,558 803,128 Three Months Ended March 31, 2021 2020 Statement of Operations Data: Revenues $ 150,054 $ 158,565 Operating expenses (31,540) (35,316) Depreciation and amortization (42,713) (45,417) Other operating expense (495) (167) Operating income 75,306 77,665 Interest expense (33,100) (41,547) Foreign exchange gain (loss) 27,427 (221,643) Gain (loss) on financial instruments 1,585 (7,005) Other (loss) income (797) 3,539 Income tax (provision) benefit (16,910) 682 Net income (loss) $ 53,511 $ (188,309) |
Other Current Liabilities (Tabl
Other Current Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Other Current Liabilities [Abstract] | |
Schedule of Other Current Liabilities | Other current liabilities consists of (in thousands): March 31, December 31, 2021 2020 Operating lease liability $ 470 $ 345 Due to affiliate 198 98 Accrued professional fees 1,163 1,287 Pension and other post-retirement liabilities 83 82 Income tax payable 34 — Accrued liabilities 232 190 $ 2,180 $ 2,002 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Income Taxes [Abstract] | |
Summary of Income Tax Benefit (Provision) | The following summarizes our income tax benefit (provision) (in thousands): Three Months Ended March 31, 2021 2020 Current income tax provision $ (340) $ (547) Deferred income tax benefit (provision) 562 (1,569) Income tax benefit (provision) $ 222 $ (2,116) |
Summary of Uncertain Tax Positions Included in Income Tax Provision | The following summarizes amounts for UTPs included in our income tax benefit (provision) (in thousands): Three Months Ended March 31, 2021 2020 Current provision for UTPs $ (245) $ (476) Deferred benefit for UTPs 9 100 Tax provision for UTPs $ (236) $ (376) |
Other Liabilities (Tables)
Other Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Other Liabilities [Abstract] | |
Schedule of Long Term Liabilities | Other liabilities consists of (in thousands): March 31, December 31, 2021 2020 Indemnification liabilities - other (see Note 13) $ 145 $ 145 Liabilities for uncertain tax positions 20,014 19,769 $ 20,159 $ 19,914 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Net income per share: | |
Schedule of Dilutive Impact of Equity Method Investee Stock Options | The following table presents the dilutive impact of Telesat stock options on Loral’s reported net income for the purpose of computing diluted earnings per share (in thousands): Three Months Ended March 31, 2021 Net income — basic $ 30,716 Less: Adjustment for dilutive effect of Telesat stock options (155) Net income — diluted $ 30,561 |
Schedule of Weighted Average Number of Shares for Calculating Diluted Earnings per Share | Basic income per share is computed based upon the weighted average number of share of voting and non-voting common stock outstanding. The following is the computation of common shares outstanding for diluted earnings per share (in thousands): Three Months Ended March 31, 2021 Weighted average common shares outstanding 30,933 Unconverted restricted stock units 99 Common shares outstanding for diluted earnings per share 31,032 |
Summary of Unvested Restricted Stock Units Excluded from the Calculation of Diluted Loss Per Share | For the three months ended March 31, 2020, the following unconverted restricted stock units are excluded from the calculation of diluted loss per share as the effect would have been antidilutive (in thousands): Three Months Ended March 31, 2020 Unconverted restricted stock units 75 |
Pensions and Other Employee B_2
Pensions and Other Employee Benefit Plans (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Pensions and Other Employee Benefit Plans [Abstract] | |
Components of Net Periodic Cost | The following table provides the components of net periodic cost for our qualified retirement plan (the “Pension Benefits”) and health care and life insurance benefits for retired employees and dependents (the “Other Benefits”) for the three months ended March 31, 2021 and 2020 (in thousands): Pension Benefits Other Benefits Three Months Ended Three Months Ended March 31, March 31, 2021 2020 2021 2020 Service cost (1) $ 187 $ 181 $ — $ — Interest cost (2) 375 440 3 4 Expected return on plan assets (2) (688) (669) — — Amortization of net actuarial loss (gain) (2) 399 303 — (1) Net periodic cost $ 273 $ 255 $ 3 $ 3 (1) Included in general and administrative expenses. (2) Included in other expense. |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies [Abstract] | |
Operating Leases Expense Net of Sublease Income | Lease costs expensed for the three months ended March 31, 2021 and 2020 were as follows (in thousands): Lease Expense Three months ended March 31, 2021 $ 174 Three months ended March 31, 2020 174 |
Reconciliation of the Lease Liability to Future Lease Payments | The following is a reconciliation of the lease liability to future lease payments as of March 31, 2021 (in thousands): Operating lease payments - (April 1, 2021 to December 31, 2021) $ 481 Less: Future interest 11 Operating lease liability $ 470 Amounts recognized in Balance Sheet Other current liabilities $ 470 |
Organization and Principal Bu_2
Organization and Principal Business (Narrative) (Details) | 3 Months Ended | ||
Mar. 31, 2021USD ($)segment | Dec. 31, 2020 | Mar. 31, 2020USD ($) | |
Organization And Principal Business [Line Items] | |||
Number of operating segment | segment | 1 | ||
Telesat Canada [Member] | |||
Organization And Principal Business [Line Items] | |||
Economic interest in affiliate | 62.60% | 62.60% | |
Voting interest in affiliate | 32.60% | 32.60% | |
Common Control Reorganization [Member] | Other Expense [Member] | |||
Organization And Principal Business [Line Items] | |||
Transaction expenses | $ 2,300,000 | $ 1,400,000 | |
Common Control Reorganization [Member] | Plan [Member] | Public Sector Pension Investment Board [Member] | |||
Organization And Principal Business [Line Items] | |||
Loss contingency, contract breach | 40,000,000 | ||
Common Control Reorganization [Member] | Plan [Member] | Minimum [Member] | Red Isle Private Investments Inc. [Member] | |||
Organization And Principal Business [Line Items] | |||
Loss contingency, contract termination | 6,550,000 | ||
Common Control Reorganization [Member] | Plan [Member] | Maximum [Member] | Red Isle Private Investments Inc. [Member] | |||
Organization And Principal Business [Line Items] | |||
Loss contingency, contract termination | $ 22,910,000 |
Basis of Presentation (Narrativ
Basis of Presentation (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | Nov. 23, 2020 | Apr. 30, 2020 | Mar. 31, 2021 | Dec. 31, 2020 |
Basis of Presentation [Line Items] | ||||
Cash and cash equivalents | $ 25,460 | $ 31,631 | ||
Restricted Cash | 300 | 300 | ||
Special Dividend I [Member] | ||||
Basis of Presentation [Line Items] | ||||
Dividends payable, date declared | Apr. 30, 2020 | |||
Common stock, dividends, per share | $ 5.50 | |||
Dividends, cash | $ 170,100 | |||
Dividends payable, date paid | May 28, 2020 | |||
Dividends payable, date of record | May 14, 2020 | |||
Special Dividend II [Member] | ||||
Basis of Presentation [Line Items] | ||||
Dividends payable, date declared | Nov. 23, 2020 | |||
Common stock, dividends, per share | $ 1.50 | |||
Dividends, cash | $ 46,400 | |||
Dividends payable, date paid | Dec. 17, 2020 | |||
Dividends payable, date of record | Dec. 4, 2020 | |||
Equity Method Investee [Member] | ||||
Basis of Presentation [Line Items] | ||||
Investments in affiliates, guarantee or other funding obligations | $ 0 | $ 0 |
Basis of Presentation (Reconcil
Basis of Presentation (Reconciliation of Cash, Cash Equivalents and Restricted Cash) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 | Mar. 31, 2020 | Dec. 31, 2019 |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents [Abstract] | ||||
Cash and cash equivalents | $ 25,460 | $ 31,631 | ||
Restricted cash included in other current assets | 304 | 304 | ||
Cash, cash equivalents and restricted cash shown in the statement of cash flows | $ 25,764 | $ 31,935 | $ 255,502 | $ 259,371 |
Basis of Presentation (Assets a
Basis of Presentation (Assets and Liabilities Measured at Fair Value) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Money Market Funds [Member] | Level 1 [Member] | ||
Assets, Fair Value | ||
Cash and cash equivalents | $ 22,167 | $ 29,166 |
Money Market Funds [Member] | Level 2 [Member] | ||
Assets, Fair Value | ||
Cash and cash equivalents | 0 | 0 |
Money Market Funds [Member] | Level 3 [Member] | ||
Assets, Fair Value | ||
Cash and cash equivalents | 0 | 0 |
Sale of SSL, Nov. 02, 2012 [Member] | Level 1 [Member] | ||
Assets, Fair Value | ||
Indemnification - sale of SSL | 0 | 0 |
Sale of SSL, Nov. 02, 2012 [Member] | Level 2 [Member] | ||
Assets, Fair Value | ||
Indemnification - sale of SSL | 0 | 0 |
Sale of SSL, Nov. 02, 2012 [Member] | Level 3 [Member] | ||
Assets, Fair Value | ||
Indemnification - sale of SSL | 598 | 598 |
Globalstar do Brasil S.A. [Member] | Level 1 [Member] | ||
Liabilities, Fair Value | ||
Indemnification - Globalstar do Brasil S.A. | 0 | 0 |
Globalstar do Brasil S.A. [Member] | Level 2 [Member] | ||
Liabilities, Fair Value | ||
Indemnification - Globalstar do Brasil S.A. | 0 | 0 |
Globalstar do Brasil S.A. [Member] | Level 3 [Member] | ||
Liabilities, Fair Value | ||
Indemnification - Globalstar do Brasil S.A. | $ 145 | $ 145 |
Basis of Presentation (Addition
Basis of Presentation (Additional Cash Flow Information) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Non-cash operating items: | ||
Equity in net (income) loss of affiliates | $ (34,602) | $ 117,074 |
Deferred taxes | (562) | 1,569 |
Depreciation | 1 | 1 |
Right-of-use asset, net of lease liability | (3) | (1) |
Amortization of prior service credit and actuarial (gain) loss | 399 | 302 |
Net non-cash operating items - continuing operations | (34,767) | 118,945 |
Supplemental information: | ||
Interest paid - continuing operations | 6 | 5 |
Income tax refunds | 2 | 178 |
Income tax payments | $ 63 | $ 63 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) (Components of Accumulated Other Comprehensive Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2020 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Accumulated other comprehensive income (loss), beginning balance | $ (71,972) | |||
Other comprehensive income (loss), Net-of-tax Amount | (1,816) | $ 31,290 | ||
Accumulated other comprehensive income (loss), ending balance | (73,788) | $ (71,972) | $ (71,972) | |
Postretirement Benefits [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Accumulated other comprehensive income (loss), beginning balance | (18,993) | (16,167) | (16,167) | |
Other comprehensive income (loss) before reclassification | 0 | (3,852) | ||
Amounts reclassified from accumulated other comprehensive income (loss) | 315 | 1,026 | ||
Other comprehensive income (loss), Net-of-tax Amount | 315 | (2,826) | ||
Accumulated other comprehensive income (loss), ending balance | (18,678) | (18,993) | (18,993) | |
Equity in Telesat-related Other Comprehensive Loss [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Accumulated other comprehensive income (loss), beginning balance | (52,979) | (38,747) | (38,747) | |
Other comprehensive income (loss) before reclassification | (2,131) | (14,232) | ||
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | 0 | ||
Other comprehensive income (loss), Net-of-tax Amount | (2,131) | (14,232) | ||
Accumulated other comprehensive income (loss), ending balance | (55,110) | (52,979) | (52,979) | |
Accumulated Other Comprehensive Loss [Member] | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Accumulated other comprehensive income (loss), beginning balance | (71,972) | (54,914) | (54,914) | |
Other comprehensive income (loss) before reclassification | (2,131) | (18,084) | ||
Amounts reclassified from accumulated other comprehensive income (loss) | 315 | 1,026 | ||
Other comprehensive income (loss), Net-of-tax Amount | (1,816) | $ 31,290 | (48,348) | (17,058) |
Accumulated other comprehensive income (loss), ending balance | $ (73,788) | $ (71,972) | $ (71,972) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Income (Loss) (Components of Other Comprehensive Income and Related Tax Effects) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | ||
Accumulated Other Comprehensive Loss [Abstract] | |||
Amortization of prior service credits and net actuarial loss, Before-Tax Amount | [1] | $ 399 | $ 302 |
Equity in Telesat-related other comprehensive income (loss), Before-Tax Amount | (2,133) | 31,063 | |
Other comprehensive income (loss), Before-Tax Amount | (1,734) | 31,365 | |
Amortization of prior service credits and net actuarial loss, Tax (Provision) Benefit | (84) | (63) | |
Equity in Telesat-related other comprehensive income (loss), Tax (Provision) Benefit | 2 | (12) | |
Other comprehensive income, Tax (Provision) Benefit | (82) | (75) | |
Amortization of prior service credits and net actuarial gain (loss), Net-of-Tax Amount | 315 | 239 | |
Equity in Telesat-related other comprehensive income (loss), Net-of-Tax Amount | (2,131) | 31,051 | |
Other comprehensive income (loss), Net-of-tax Amount | $ (1,816) | $ 31,290 | |
[1] | Reclassifications are included in other expense. |
Other Current Assets (Schedule
Other Current Assets (Schedule of Other Current Assets) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Other Current Assets [Abstract] | ||
Restricted cash (see Note 2) | $ 304 | $ 304 |
Indemnification receivable from SSL for pre-closing taxes (see note 13) | 598 | 598 |
Due from affiliates | 59 | 88 |
Prepaid expenses | 838 | 240 |
Other | 2 | 2 |
Total other current assets | $ 1,801 | $ 1,232 |
Investments in Affiliates (Narr
Investments in Affiliates (Narrative) (Details) - USD ($) $ in Thousands | Apr. 27, 2021 | Jul. 02, 2020 | Apr. 30, 2021 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Jul. 01, 2020 | Dec. 31, 2019 |
Investments in and Advances to Affiliates [Line Items] | ||||||||
Investments in affiliates | $ 225,133 | $ 192,664 | ||||||
Equity in Telesat-related other comprehensive income (loss), Before-Tax Amount | $ (2,133) | $ 31,063 | ||||||
Telesat Canada [Member] | ||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||
Economic interest in affiliate | 62.60% | 62.60% | ||||||
Voting interest in affiliate | 32.60% | 32.60% | ||||||
Investments in affiliates | $ 225,133 | $ 192,664 | ||||||
Equity in Telesat-related other comprehensive income (loss), Before-Tax Amount | (2,100) | |||||||
Annual Consulting fees payable in cash | $ 5,000 | |||||||
Telesat Canada [Member] | Subsequent Event [Member] | ||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||
Number os stock options cancelled | 6,197,776 | |||||||
Telesat Canada [Member] | Subsequent Event [Member] | Restricted Stock Units (RSUs) [Member] | ||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||
Telesat Restricted Stock Units available for grant | 3,660,000 | |||||||
Telesat Restricted Stock Units, issuance terms | aggregate number of non-voting participating preferred shares issuable under the Telesat RSU plan (and under all other share compensation arrangements) does not exceed 10% of the total number of non-voting participating preferred shares outstanding from time to time (on a non-diluted basis) | |||||||
Telesat Restricted Stock Units granted | 3,530,000 | |||||||
Restricted Stock Units remaining available for grant | 130,000 | |||||||
Telesat Canada [Member] | Senior Secured Credit Facility [Member] | ||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||
Minimum total leverage ratio | 4.50 | |||||||
Minimum total leverage ratio to incur debt and make payments | 4.38 | |||||||
XTAR, LLC [Member] | ||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||
Investments in affiliates | $ 0 | 0 | ||||||
Percentage of ownership interest | 56.00% | |||||||
Commitment to provide further financial support | $ 0 | |||||||
XTAR, LLC [Member] | Hisdesat Servicios Estrategicos, S.A. [Member] | ||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||
Percentage of ownership interest | 44.00% | |||||||
Globalstar de Mexico [Member] | ||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||
Investments in affiliates | $ 0 | $ 0 | ||||||
Senior Secured Notes 5.625% [Member] | Telesat Canada [Member] | Subsequent Event [Member] | ||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||
Debt instrument, issuance date | Apr. 27, 2021 | |||||||
Senior notes issued and outstanding | $ 500,000 | |||||||
Interest on notes | 5.625% | |||||||
Indenture maturity date | Dec. 6, 2026 | |||||||
Transaction, Management Agreement [Member] | XTAR, LLC [Member] | ||||||||
Investments in and Advances to Affiliates [Line Items] | ||||||||
Amount due to Loral under the Loral Management Agreement | $ 6,600 | $ 6,600 | ||||||
Allowance for doubtful receivable | $ 6,600 | |||||||
Increase (decrease) in due from affiliates | $ (5,900) |
Investments in Affiliates (Inve
Investments in Affiliates (Investments in Affiliates) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Schedule of Equity Method Investments [Line Items] | ||
Investments in affiliates | $ 225,133 | $ 192,664 |
Telesat Canada [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Investments in affiliates | $ 225,133 | $ 192,664 |
Investments in Affiliates (Equi
Investments in Affiliates (Equity in Net Income (Losses) of Affiliates) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Schedule of Equity Method Investments [Line Items] | ||
Equity in net income (loss) of affiliates | $ 34,602 | $ (117,074) |
Telesat Canada [Member] | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity in net income (loss) of affiliates | $ 34,602 | $ (117,074) |
Investments in Affiliates (Eq_2
Investments in Affiliates (Equity Method Investment, Summarized Financial Data) (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | |
Assets: | ||||
Current assets | $ 28,489 | $ 34,091 | ||
Total assets | 281,944 | 254,469 | ||
Liabilities and Shareholder's Equity: | ||||
Current liabilities | 3,559 | 4,841 | ||
Total liabilities | 43,511 | 44,936 | ||
Stockholder's Equity | 238,433 | $ 259,974 | 209,533 | $ 350,027 |
Statement of Operations Data: | ||||
Operating income (loss) | (1,729) | (1,648) | ||
Interest expense | (6) | (5) | ||
Income tax (provision) benefit | 222 | (2,116) | ||
Telesat Canada [Member] | ||||
Assets: | ||||
Current assets | 759,747 | 703,210 | ||
Total assets | 4,018,684 | 3,943,875 | ||
Liabilities and Shareholder's Equity: | ||||
Current liabilities | 157,117 | 129,849 | ||
Long-term debt | 2,483,716 | 2,483,256 | ||
Total liabilities | 3,158,126 | 3,140,747 | ||
Stockholder's Equity | 860,558 | $ 803,128 | ||
Statement of Operations Data: | ||||
Revenues | 150,054 | 158,565 | ||
Operating expenses | (31,540) | (35,316) | ||
Depreciation and amortization | (42,713) | (45,417) | ||
Other operating income (expense) | (495) | (167) | ||
Operating income (loss) | 75,306 | 77,665 | ||
Interest expense | (33,100) | (41,547) | ||
Foreign exchange gain (loss) | 27,427 | (221,643) | ||
Gain (loss) on financial instruments | 1,585 | (7,005) | ||
Other income (expense) | (797) | 3,539 | ||
Income tax (provision) benefit | (16,910) | 682 | ||
Net income (loss) | $ 53,511 | $ (188,309) |
Other Current Liabilities (Sche
Other Current Liabilities (Schedule of Other Current Liabilities) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Other Current Liabilities [Abstract] | ||
Operating lease liability, current | $ 470 | $ 345 |
Operating lease liability, current statement of financial position | Other current liabilities, total | Other current liabilities, total |
Due to affiliate | $ 198 | $ 98 |
Accrued professional fees | 1,163 | 1,287 |
Pension and other post-retirement liabilities | 83 | 82 |
Income taxes payable | 34 | 0 |
Accrued liabilities | 232 | 190 |
Other current liabilities, total | $ 2,180 | $ 2,002 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Contingency [Line Items] | ||||
Coronavirus Aid Relief and Economic Security Act, Income Tax Expense (Benefit) | $ (3,100) | |||
Deferred tax assets | $ 27,819 | $ 27,339 | ||
Accrued tax penalties | 0 | |||
Unrecognized tax benefits, interest on income taxes accrued | 3,600 | |||
Unrecognized tax benefits that would reduce the income tax provision | 8,700 | |||
Unrecognized Tax Benefits | 43,000 | |||
Forecast [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Reduction to unrecognized tax benefits | $ 16,400 | |||
Telesat Canada [Member] | Federal [Member] | ||||
Income Tax Contingency [Line Items] | ||||
Fed Tax On GILTI | 0 | 0 | ||
Deferred tax assets | $ 0 | $ 0 |
Income Taxes (Summary of Income
Income Taxes (Summary of Income Tax Benefit (Provision)) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Taxes [Abstract] | ||
Current income tax provision | $ (340) | $ (547) |
Deferred income tax benefit (provision) | 562 | (1,569) |
Income tax benefit (provision) | $ 222 | $ (2,116) |
Income Taxes (Summary of Uncert
Income Taxes (Summary of Uncertain Tax Positions Included in Income Tax Provision) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Taxes [Abstract] | ||
Current (provision) benefit for UTPs | $ (245) | $ (476) |
Deferred benefit (provision) for UTPs | 9 | 100 |
Tax (provision) benefit for UTPs | $ (236) | $ (376) |
Other Liabilities (Schedule of
Other Liabilities (Schedule of Long Term Liabilities) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Other Liabilities [Abstract] | ||
Indemnification liabilities - other (see Note 13) | $ 145 | $ 145 |
Liabilities for uncertain tax positions | 20,014 | 19,769 |
Long-term liabilities | $ 20,159 | $ 19,914 |
Stock-Based Compensation (Narra
Stock-Based Compensation (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2020 | |
Stock-Based Compensation [Abstract] | ||||
Weighted Average Number of Shares, Restricted Stock | 98,917 | 75,262 | ||
Common Stock, Dividends, Per Share, Cash Paid | $ 7 | |||
Dividends, Common Stock, Cash | $ 216,529 | $ 216,500 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Non-Option Equity Instruments, Period Increase (Decrease) | 23,655 |
Earnings Per Share (Narrative)
Earnings Per Share (Narrative) (Details) - Telesat Canada [Member] | 3 Months Ended | |
Mar. 31, 2021 | Dec. 31, 2020 | |
Percentage of economic interest as result of dilution upon exercise of stock options | 62.40% | |
Economic interest in affiliate | 62.60% | 62.60% |
Earnings Per Share (Schedule of
Earnings Per Share (Schedule of Dilutive Impact of Equity Method Investee Stock Options) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Net income per share: | ||
Net income - basic | $ 30,716 | $ (121,343) |
Less: Adjustment for dilutive effect of Telesat stock options | (155) | |
Net income - diluted | $ 30,561 |
Earnings Per Share (Schedule _2
Earnings Per Share (Schedule of Weighted Average Number of Shares for Calculating Diluted Earnings Per Share) (Details) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Net income per share: | ||
Weighted average common shares outstanding | 30,933 | 30,933 |
Unconverted restricted stock units | 99 | |
Common shares outstanding for diluted earnings per share | 31,032 | 30,933 |
Earnings Per Share (Summary of
Earnings Per Share (Summary of Unvested Restricted Stock Units Excluded from the Calculation of Diluted Loss Per Share) (Details) shares in Thousands | 3 Months Ended |
Mar. 31, 2020shares | |
Net income per share: | |
Unconverted restricted stock units | 75 |
Pensions and Other Employee B_3
Pensions and Other Employee Benefits Plans (Components of Net Periodic Cost) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | ||
Pension Benefits [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost | [1] | $ 187 | $ 181 |
Interest cost | [2] | 375 | 440 |
Expected return on plan assets | [2] | (688) | (669) |
Amortization of net actuarial loss (gain) | [2] | 399 | 303 |
Net periodic cost | 273 | 255 | |
Other Benefits [Member] | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Service cost | [1] | 0 | 0 |
Interest cost | [2] | 3 | 4 |
Expected return on plan assets | [2] | 0 | 0 |
Amortization of net actuarial loss (gain) | [2] | 0 | (1) |
Net periodic cost | $ 3 | $ 3 | |
[1] | Included in general and administrative expenses. | ||
[2] | Included in other expense. |
Financial Instruments, Deriva_2
Financial Instruments, Derivative Instruments and Hedging (Details) - USD ($) $ in Millions | Mar. 31, 2021 | Dec. 31, 2020 |
Financial Instruments, Derivative Instruments and Hedging [Abstract] | ||
Derivative instruments | $ 0 | $ 0 |
Commitments and Contingencies_2
Commitments and Contingencies (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Sep. 30, 2019 | Dec. 31, 2020 | |
Contingencies And Commitments [Line Items] | ||||
Sublease income | $ 0 | $ 0 | ||
Operating lease payments | $ 200 | |||
Operating lease, term of contract | 9 months | |||
Operating lease, discount rate | 7.50% | |||
Sale of SSL, Nov. 02, 2012 [Member] | Pre Closing Taxes Indemnification [Member] | ||||
Contingencies And Commitments [Line Items] | ||||
Indemnification refund receivable | $ 600 | $ 600 | ||
Indemnification refund received | $ 1,800 | |||
Globalstar do Brasil S.A. [Member] | ||||
Contingencies And Commitments [Line Items] | ||||
Loss contingency accrual | $ 100 | $ 100 |
Commitments and Contingencies_3
Commitments and Contingencies (Operating Leases Expense Net of Sublease Income) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Commitments and Contingencies [Abstract] | ||
Rent expense | $ 174 | $ 174 |
Commitments and Contingencies_4
Commitments and Contingencies (Reconciliation of the Lease Liability to Future Lease Payments) (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Commitments and Contingencies [Abstract] | ||
Operating lease payments (April 1, 2021 to December 31, 2021) | $ 481 | |
Less: Future interest | 11 | |
Operating lease liability | $ 470 | |
Operating lease liability, statement of financial position | us-gaap:OtherLiabilitiesCurrent | us-gaap:OtherLiabilitiesCurrent |
Operating lease liability, current | $ 470 | $ 345 |
Operating lease liability, current statement of financial position | us-gaap:OtherLiabilitiesCurrent | us-gaap:OtherLiabilitiesCurrent |
Related Party Transactions (Nar
Related Party Transactions (Narrative) (Details) - USD ($) | Jul. 02, 2020 | Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2013 | Dec. 31, 2020 | Jul. 01, 2020 | Dec. 31, 2019 |
Related Party Transaction [Line Items] | |||||||
Due to affiliate | $ 198,000 | $ 98,000 | |||||
Amounts due under the transaction | $ 59,000 | $ 88,000 | |||||
Transaction, Consulting Agreement [Member] | Director [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Related party transaction, start date | Dec. 14, 2012 | ||||||
Transaction fee | $ 360,000 | $ 360,000 | |||||
Transaction income during the period | 11,250 | 11,250 | |||||
Monthly Fee [Member] | Transaction, Consulting Agreement [Member] | Director [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Transaction fee | $ 120,000 | ||||||
Telesat Canada [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Economic interest in affiliate | 62.60% | 62.60% | |||||
Voting interest in affiliate | 32.60% | 32.60% | |||||
Common stock, percentage acquired by an unaffiliated third party | 90.00% | ||||||
Duration for shares to be paid, days | 10 days | ||||||
Telesat Canada [Member] | Transaction, Consulting Agreement [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Related party transaction, start date | Oct. 31, 2007 | ||||||
Consulting agreement term | seven-years with an automatic renewal for an additional seven-year | ||||||
Transaction income during the period | $ 1,250,000 | 1,250,000 | |||||
Transaction payments received during the period | 1,200,000 | $ 1,200,000 | |||||
Telesat Canada [Member] | Annual Fee [Member] | Transaction, Consulting Agreement [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Transaction fee | 5,000,000 | ||||||
Telesat Canada [Member] | Annual Fee [Member] | Transaction Participation In Welfare Plans Administrative Fee [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Due to affiliate | 200,000 | $ 100,000 | |||||
Transaction fee | 100,000 | ||||||
Telesat Canada [Member] | Years 2003 to 2006 [Member] | Brazil [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Tax assessment imposed audit | $ 600,000 | ||||||
XTAR, LLC [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Percentage of ownership interest | 56.00% | ||||||
XTAR, LLC [Member] | Transaction, Management Agreement [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Due from affiliates | $ 100,000 | $ 100,000 | |||||
Amount due to Loral under the Loral Management Agreement | $ 6,600,000 | $ 6,600,000 | |||||
Increase (decrease) in due from affiliates | $ (5,900,000) | ||||||
Allowance for doubtful receivable | $ 6,600,000 | ||||||
Management fee charged as a percentage of revenue | 3.70% | ||||||
Common Control Reorganization [Member] | Plan [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Counterparties indemnifying | Loral, Telesat Corporation and Telesat CanHoldco | ||||||
Counterparty indemnified | Public Sector Pension Investment Board | ||||||
Transaction indemnities | (a) certain losses and litigation proceedings related to the Transaction, (b) certain out-of-pocket expenses of Loral after the Closing and (c) certain tax matters. This indemnification will be (i) independent of the accuracy of the underlying representations and warranties, (ii) in the case of the tax indemnification, subject to a cap of $50 million and (iii) subject to additional, customary limitations. | ||||||
Tax indemnification - maximum | $ 50,000,000 | ||||||
Series B Preferred Stock [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Preferred stock, shares issued | 5 | 5 | |||||
Red Isle Private Investments Inc. [Member] | Common Control Reorganization [Member] | Plan [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Related Party Transaction, Description of Transaction | if such payment is less than $7 million due to a lack of available cash, Telesat Partnership will be required to pay the balance of such unpaid amount to Red Isle no later than 35 trading days following consummation of the Transaction | ||||||
Transaction fee | $ 7,000,000 | ||||||
Red Isle Private Investments Inc. [Member] | Minimum [Member] | Common Control Reorganization [Member] | Plan [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Loss contingency, contract termination | 6,550,000 | ||||||
Red Isle Private Investments Inc. [Member] | Maximum [Member] | Common Control Reorganization [Member] | Plan [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Loss contingency, contract termination | 22,910,000 | ||||||
Public Sector Pension Investment Board [Member] | Common Control Reorganization [Member] | Plan [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Loss contingency, contract breach | $ 40,000,000 | ||||||
MHR Funds [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Percentage of outstanding voting common stock | 39.90% | 39.90% | |||||
Percentage of combined ownership of voting and non-voting common stock | 58.40% | 58.40% | |||||
MHR Funds [Member] | Maximum [Member] | Additional Voting Common Stock [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Percentage of outstanding voting common stock | 6.00% |