Final Version

LORAL SPACE & COMMUNICATIONS INC.
2005 STOCK INCENTIVE PLAN
(Amended and Restated as of April 16, 2007)

1. Purpose.

The purpose of the Plan is to assist the Company in attracting, retaining,
motivating and rewarding Eligible Persons, and to promote the creation of
long-term value for stockholders by closely aligning the interests of
Participants with those of stockholders. The Plan authorizes the award of
stock-based incentives to Participants to encourage such persons to expend their
maximum efforts in the creation of stockholder value. The Plan is also intended
to qualify certain compensation awarded under the Plan for tax deductibility
under Section 162(m) of the Code to the extent deemed appropriate by the
Committee which administers the Plan.

2. Definitions.

For purposes of the Plan, the following terms shall be defined as set forth
below:

(a) “Affiliate” means, any other entity that, directly or indirectly through one
or more intermediaries, controls, is controlled by or is under common control
with the Company.

(b) “Award” means any award of an Option, SAR, Restricted Stock, Restricted
Stock Unit, Stock granted as a bonus or in lieu of another award, or Other
Stock-Based Award.

(c) “Board” means the Board of Directors of the Company.

(d) “Cause” with respect to any Participant (A) shall have the meaning set forth
in the current effective employment or consulting agreement between the Company
or an Affiliate, as applicable, and the Participant or (B) in the event that
there is no such employment or consulting agreement or if there is no such
definition in any such employment or consulting agreement, shall mean, (i) the
Participant shall have been after the Effective Date convicted of, or shall have
pleaded guilty or nolo contendere to, any felony or any other crime that would
have constituted a felony under the laws of the State of New York; (ii) the
Participant shall have been indicted for any felony or any other crime that
would have constituted a felony under the laws of the State of New York in
connection with or arising from the Participant’s employment with the Company;
(iii) the Participant shall have breached any material provision of any
noncompetition, nonsolicitation or confidentiality agreement with the Company or
any Affiliate; (iv) the Participant shall have committed any fraud,
embezzlement, misappropriation of funds, or breach of fiduciary duty against the
Company or any Affiliate, in each case of a material nature; (v) the Participant
shall have engaged in any willful misconduct resulting in or reasonably likely
to result in a material loss to the Company or substantial damage to its
reputation; or (vi) the Participant willfully breaches in any material respect
any material provision of the Company’s Code of Conduct and, to the extent any
such breach is curable, the Participant has failed to cure such breach within
ten (10) days after written notice of the alleged breach is provided to the
Participant.

(e) “Change in Control” shall be deemed to have occurred if: (i) any person (as
defined in Section 3(a)(9) of the Exchange Act, and as used in Sections 13(d)
and 14(d) thereof, including any “group” as defined in Section 13(d)(3) thereof
(a “Person”), but excluding the Company, any Affiliate, any employee benefit
plan sponsored or maintained by the Company or any Affiliate (including any
trustee of such plan acting as trustee), and any Person who owns 20% or more of
the total number of votes that may be cast for the election of directors of the
Company (the “Voting Shares”) as of the Effective Date, becomes the beneficial
owner of 35% of the “Voting Shares”; (ii) the Company undergoes any merger,
consolidation, reorganization, recapitalization or other similar business
transaction, sale of all or substantially all of the Company’s assets or
combination of the foregoing transactions (a “Transaction”), other than a
Transaction involving only the Company and one or more Affiliates, and
immediately following such Transaction the shareholders of the Company
immediately prior to the Transaction do not continue to own at least a majority
of the voting power in the resulting entity; (iii) the persons who are the
original members of the Board pursuant to the Plan of Reorganization (the
“Incumbent Directors”) shall cease (for any reason other than death) to
constitute at least a majority of members of the Board or the board of directors
of any successor to the Company, provided that any director who was not a
director as of the Effective Date shall be deemed to be an Incumbent Director if
such director was elected to the Board by, or on the recommendation of or with
the approval of, at least a majority of the directors who then qualified as
Incumbent Directors, either actually or by prior operation of this definition;
or (iv) the shareholders of the Company approve a plan of liquidation or
dissolution of the Company, or any such plan is actually implemented.

(f) “Code” means the Internal Revenue Code of 1986, as amended from time to
time, including regulations thereunder and successor provisions and regulations
thereto.

(g) “Committee” means a committee of two or more directors designated by the
Board to administer the Plan; provided, however, that directors appointed as
members of the Committee shall not be employees of the Company or any
subsidiary. In appointing members of the Committee, the Board will consider
whether a member is or will be a Qualified Member, but such members are not
required to be Qualified Members at the time of appointment or during their term
of service on the Committee, and no action of the Committee shall be void or
invalid due to the participation of a member who is not a Qualified Member. If
no Committee has been appointed, or if the Committee has been disbanded, or if
the Board makes a determination to assume any or all powers of the Committee,
any reference herein shall be deemed to be a reference to the Board; provided,
however that if the Board acts as the Committee, each member of the Board who is
not a an independent member of the Board under the NASDAQ independence
requirements shall recuse himself or herself from any such Board action, unless
such action is for the purpose of granting awards hereunder to members of the
Board who are independent members of the Board not employed by the Company and
the Board determines to act as the full Board.

(h) “Company” means Loral Space & Communications Inc., a Delaware corporation.

(i) “Disability” means the permanent and total disability of a person within the
meaning of Section 22(e)(3) of the Code.

(j) “Dividend Equivalents” shall have the meaning set forth in Section 9 hereof.

(k) “Effective Date” shall have the meaning set forth in Section 21 hereof.

(l) “Eligible Person” means each employee of the Company or of any Affiliate,
including each such person who may also be a director of the Company, each
non-employee director of the Company or an Affiliate, each other person who
provides substantial services to the Company and/or its Affiliates and who is
designated as eligible by the Committee, and any person who has been offered
employment by the Company or an Affiliate, provided that such prospective
employee may not receive any payment or exercise any right relating to an Award
until such person has commenced employment with the Company or an Affiliate. An
employee on an approved leave of absence may be considered as still in the
employ of the Company or an Affiliate for purposes of eligibility for
participation in the Plan.

(m) “Employer” means either the Company or an Affiliate that the Participant
(determined without regard to any transfer of an Award) is employed by or
provides services to, as applicable.

(n) “Exchange Act” means the Securities Exchange Act of 1934, as amended from
time to time, including rules thereunder and successor provisions and rules
thereto.

(o) “Expiration Date” means the date upon which the term of an Option, as
determined under 6(b) hereof, or SAR, as determined under Section 7(a)(ii)
hereof expires.

(p) “Fair Market Value” means on any date (A) if the Stock is listed on a
national securities exchange, the closing sale price reported as having occurred
on the primary exchange with which the Stock is listed and traded on such date,
or, if there is no such sale on that date, then on the last preceding date on
which such a sale was reported, (B) if the Stock is not listed on any national
securities exchange but is traded in the over-the-counter market bulletin board
or pink sheets on a last sale basis, the closing sale price reported on such
date, or, if there is no such sale on that date then on the last preceding date
on which such a sale was reported; provided, however, that for purposes of the
Initial Option Grant, the Fair Market Value shall be the weighted average of the
aggregate sale prices of the Stock reported for the ten trading days immediately
preceding the grant date; and further provided, however, that if such definition
of Fair Market Value for Options granted in connection with the Plan of
Reorganization does not comply with the definition of fair market value for
purposes of Section 409A of the Code or if such definition would give rise to
variable accounting treatment of such Options, then Fair Market Value for such
Options shall have the meaning attributable thereto in clauses (A) or (B) above,
as applicable, or such other meaning which complies with Section 409A and does
not give rise to variable accounting treatment. If the Stock is not listed on an
exchange or traded in the over-the-counter market, or representative quotes are
not otherwise available, the Fair Market Value shall mean the amount determined
by the Board in good faith to be the fair market value per share of Stock, on a
fully diluted basis.

(q) “Good Reason” with respect to any Participant (A) shall have the meaning set
forth in the current effective employment or consulting agreement between the
Company or an Affiliate, as applicable, and the Participant or (B) in the event
that there is no such employment or consulting agreement or if there is no such
definition in any such employment or consulting agreement, shall mean, (i) the
assignment to the Participant of any duties inconsistent in any substantial
respect with the Participant’s position, authority or responsibilities to or
with the Company or an Affiliate, as applicable, or any duties which are illegal
or unethical or any diminution of any of the Participant’s significant duties;
(ii) any reduction in base salary, or to the extent guaranteed by a contract
with the Company or an Affiliate, as applicable, the Participant’s target annual
bonus or any of the benefits provided for in any such contract to the extent
such reduction is not permitted under the terms of any such contract; (iii) the
relocation by the Company of the Participant’s primary place of employment with
the Company to a location not within a thirty (30) mile radius of such place of
employment as of the Effective Date; provided, however, that such relocation
shall not be considered Good Reason if such location is closer to the
Participant’s home than the Participant’s primary place of employment as of the
Effective Date; (iv) any material breach of any employment or consulting
agreement with the Participant by the Company, or an Affiliate, as appropriate;
or (v) the failure of the Company to obtain the assumption in writing of its
obligation to perform any employment or consulting agreement with the
Participant by any successor to all or substantially all of the assets of the
Company.

(r) “Initial Option Grant” shall mean the automatic award of options under the
Plan as set forth in Section 6(h).

(s) “Mature Shares” means (A) shares of Stock for which the Participant has good
title, free and clear of all liens and encumbrances, and which the Participant
either (i) has held for at least six months or (ii) has purchased on the open
market or (B) such shares as determined by the Committee.

(t) “New Skynet” shall have the meaning ascribed thereto in the Plan of
Reorganization.

(u) “New Skynet Sale Event” means a sale of all or substantially all of the
common stock or assets of New Skynet.

(v) “New SS/L” shall have the meaning ascribed thereto in the Plan of
Reorganization.

(w) “New SS/L Sale Event” means a sale of all or substantially all of the common
stock or assets of New SS/L.

(x) “Option” means a conditional right, granted to a Participant under Section 6
hereof, to purchase Stock at a specified price during specified time periods.

(y) “Option Agreement” means a written agreement between the Company and a
Participant evidencing the terms and conditions of an individual Option grant.

(z) “Other Stock-Based Awards” means Awards granted to a Participant under
Section 11 hereof.

(aa) “Participant” means an Eligible Person who has been granted an Award under
the Plan which remains outstanding, or if applicable, such other person or
entity who holds an outstanding Award.

(bb) “Plan” means this Loral Space & Communications Inc. 2005 Stock Incentive
Plan.

(cc) “Plan of Reorganization” means the Fourth Amended Joint Plan of
Reorganization under Chapter 11 of the Bankruptcy Code of Loral Space &
Communications Ltd., et al.

(dd) “Proprietary Information” with respect to any Participant means all
confidential specifications, know-how, strategic or technical data, marketing
research data, product research and development data, manufacturing techniques,
confidential customer lists, sources of supply and trade secrets, all of which
are confidential to the Company, or any of its Affiliates, and may be
proprietary and are owned or used by the Company, or any of its Affiliates,
including any and all of such enumerated items coming within the scope of the
business of the Company, or any of its Affiliates, as to which the Participant
may have access, whether conceived or developed by others or by the Participant,
alone or with others, during the Participant’s period of service with the
Company, and whether or not conceived or developed during regular working hours.
However, Proprietary Information shall not include any records, data or
information which are in the public domain during the Participant’s service with
the Company or after the Participant’s service with the Company has terminated,
provided the same are not in the public domain as a consequence of disclosure by
the Participant.

(ee) “Qualified Member” means a member of the Committee who is a “Non-Employee
Director” within the meaning of Rule 16b-3 and an “outside director” within the
meaning of Regulation 1.162-27(c) under Code Section 162(m).

(ff) “Restricted Stock” means Stock granted to a Participant under Section 8
hereof, that is subject to certain restrictions and to a risk of forfeiture.

(gg) “Restricted Stock Agreement” means a written agreement between the Company
and a Participant evidencing the terms and conditions of an individual
Restricted Stock grant.

(hh) “Restricted Stock Unit” means a notional unit representing the right to
receive one share of Stock on the Settlement Date.

(ii) “Restricted Stock Unit Agreement” means a written agreement between the
Company and a Participant evidencing the terms and conditions of an individual
Restricted Stock Unit grant.

(jj) “Rule 16b-3” means Rule 16b-3, as from time to time in effect and
applicable to the Plan and Participants, promulgated by the Securities and
Exchange Commission under Section 16 of the Exchange Act.

(kk) “Section 409A” shall mean Section 409A of the Code and the rules and
regulations promulgated thereunder, including Treasury Regulation 2005-1.

(ll) “Securities Act” means the Securities Act of 1933, as amended from time to
time, including rules thereunder and successor provisions and rules thereto.

(mm) “Senior Management Employee” means an employee of the Company designated by
the Chief Executive Officer of the Company as a Senior Management Employee.

(nn) “Settlement Date” shall have the meaning set forth in Section 9 hereof.

(oo) “Stock” means the Company’s Common Stock, $.01 par value, and such other
securities as may be substituted for Stock pursuant to Section 12 hereof.

(pp) “Stock Appreciation Right” or “SAR” means a conditional right granted to a
Participant under Section 7 hereof.

3. Administration.

(a) Authority of the Committee. Except as otherwise provided below, the Plan
shall be administered by the Committee. The Committee shall have full and final
authority, in each case subject to and consistent with the provisions of the
Plan, to (i) select Eligible Persons to become Participants; (ii) grant Awards;
(iii) determine the type, number, and other terms and conditions of, and all
other matters relating to, Awards; (iv) prescribe Award agreements (which need
not be identical for each Participant) and rules and regulations for the
administration of the Plan; (v) construe and interpret the Plan and Award
agreements and correct defects, supply omissions, or reconcile inconsistencies
therein; and (vi) make all other decisions and determinations as the Committee
may deem necessary or advisable for the administration of the Plan. The
foregoing notwithstanding, the Board shall perform the functions of the
Committee for purposes of granting Awards under the Plan to non-employee
directors. In any case in which the Board is performing a function of the
Committee under the Plan, each reference to the Committee herein shall be deemed
to refer to the Board, except where the context otherwise requires. Any action
of the Committee shall be final, conclusive and binding on all persons,
including, without limitation, the Company, its Affiliates, Eligible Persons,
Participants and beneficiaries of Participants.

(b) Manner of Exercise of Committee Authority. At any time that a member of the
Committee is not a Qualified Member, (i) any action of the Committee relating to
an Award intended by the Committee to qualify as “performance-based
compensation” within the meaning of Section 162(m) of the Code and regulations
thereunder may be taken by a subcommittee, designated by the Committee or the
Board, composed solely of two or more Qualified Members; and (ii) any action
relating to an Award granted or to be granted to a Participant who is then
subject to Section 16 of the Exchange Act in respect of the Company may be taken
either by such a subcommittee or by the Committee but with each such member who
is not a Qualified Member abstaining or recusing himself or herself from such
action, provided that, upon such abstention or recusal, the Committee remains
composed of two or more Qualified Members. Such action, authorized by such a
subcommittee or by the Committee upon the abstention or recusal of such
non-Qualified Member(s), shall be the action of the Committee for purposes of
the Plan. The express grant of any specific power to the Committee, and the
taking of any action by the Committee, shall not be construed as limiting any
power or authority of the Committee.

(c) Delegation. The Committee may delegate to officers or employees of the
Company or any Affiliate, or committees thereof, the authority, subject to such
terms as the Committee shall determine, to perform such functions, including but
not limited to administrative functions, as the Committee may determine
appropriate. The Committee may appoint agents to assist it in administering the
Plan. Notwithstanding the foregoing or any other provision of the Plan to the
contrary, any Award granted under the Plan to any person or entity who is not an
employee of the Company or any of its Affiliates shall be expressly approved by
the Committee.

4. Shares Available Under the Plan.

(a) Number of Shares Available for Delivery. Subject to adjustment as provided
in Section 12 hereof, the total number of shares of Stock reserved and available
for delivery in connection with Awards under the Plan shall be 2,972,452. Shares
of Stock delivered under the Plan shall consist of authorized and unissued
shares or previously issued shares of Stock reacquired by the Company on the
open market or by private purchase.

(b) Share Counting Rules. The Committee may adopt reasonable counting procedures
to ensure appropriate counting, avoid double counting (as, for example, in the
case of tandem or substitute awards) and make adjustments if the number of
shares of Stock actually delivered differs from the number of shares previously
counted in connection with an Award. To the extent that an Award expires or is
canceled, forfeited, settled in cash or otherwise terminated or concluded
without a delivery to the Participant of the full number of shares to which the
Award related, the undelivered shares will again be available for Awards. Shares
withheld in payment of the exercise price or taxes relating to an Award and
shares equal to the number surrendered in payment of any exercise price or taxes
relating to an Award shall be deemed to constitute shares not delivered to the
Participant and shall be deemed to again be available for Awards under the Plan;
provided, however, that, where shares are withheld or surrendered more than ten
years after the date of the most recent shareholder approval of the Plan or any
other transaction occurs that would result in shares becoming available under
this Section 4(b), such shares shall not become available if and to the extent
that it would constitute a material revision of the Plan subject to shareholder
approval under then applicable rules of the principle stock exchange or
automated quotation system on which the shares are then listed or designated for
trading.

5. Eligibility; Limitations on Awards.

(a) Grants to Eligible Persons. Awards may be granted under the Plan only to
Eligible Persons.

(b) 162(m) Limitation. Subject to Section 12 relating to adjustments, no
Employee shall be eligible to be granted Options or Stock Appreciation Rights
covering more than 1,000,000 shares of Stock during any calendar year.

6. Options.

(a) General. Except as provided in the Initial Option Grant, Options granted
hereunder shall be in such form and shall contain such terms and conditions as
the Committee shall deem appropriate. The provisions of separate Options shall
be set forth in an Option Agreement, which agreements need not be identical.

(b) Term. Except as provided in the Initial Option Grant, the term of each
Option shall be set by the Committee at the time of grant; provided, however,
that no Option granted hereunder shall be exercisable after the expiration of
ten (10) years from the date it was granted.

(c) Exercise Price. Except as provided in the Initial Option Grant, the exercise
price per share of Stock for each Option shall be set by the Committee at the
time of grant but shall not be less than the par value of a share of Stock.

(d) Payment for Stock. Payment for shares of Stock acquired pursuant to Options
granted hereunder shall be made in full, upon exercise of the Options in
immediately available funds in United States dollars, by certified or bank
cashier’s check or, in the discretion of the Committee, (i) by surrender to the
Company of Mature Shares held by the Participant; (ii) by delivering to the
Committee a copy of irrevocable instructions to a stockbroker to deliver
promptly to the Company an amount of sale or loan proceeds sufficient to pay the
aggregate Option exercise price; (iii) through a net exercise of the Options
whereby the Participant instructs the Company to withhold that number of shares
of Stock having a Fair Market Value equal to the aggregate exercise price of the
Options being exercised and deliver to the Participant the remainder of the
shares subject to exercise or (iv) by any other means approved by the Committee.
Anything herein to the contrary notwithstanding, the Company shall not directly
or indirectly extend or maintain credit, or arrange for the extension of credit,
in the form of a personal loan to or for any director or executive officer of
the Company through the Plan in violation of Section 402 of the Sarbanes-Oxley
Act of 2002 (“Section 402 of SOX”), and to the extent that any form of payment
would, in the opinion of the Company’s counsel, result in a violation of
Section 402 of SOX, such form of payment shall not be available.

(e) Vesting. Except as provided in the Initial Option Grant, Options shall vest
and become exercisable in such manner and on such date or dates set forth in the
Option Agreement, as may be determined by the Committee; provided, however, that
notwithstanding any vesting dates contained herein or otherwise set by the
Committee, the Committee may in its sole discretion accelerate the vesting of
any Option, which acceleration shall not affect the terms and conditions of any
such Option other than with respect to vesting. Unless otherwise specifically
determined by the Committee and except for Options that are specifically subject
to automatic accelerated vesting upon termination of employment, the vesting of
an Option shall occur only while the Participant is employed or rendering
services to the Company or an Affiliate and all vesting shall cease upon a
Participant’s termination of employment or services for any reason. If an Option
is exercisable in installments, such installments or portions thereof which
become exercisable shall remain exercisable until the Option expires either on
the Expiration Date or earlier following a termination of employment as set
forth in the Option Agreement. Unless otherwise determined by the Committee,
Options shall vest only as to full shares of Stock, rounded down to the nearest
full share, except that the last tranche to vest with respect to any Option
Award shall encompass the full number of shares subject to the Option Award.

(f) Transferability of Options. An Option shall not be transferable except by
will or by the laws of descent and distribution and shall be exercisable during
the lifetime of the Participant only by the Participant. Notwithstanding the
foregoing, Options shall be transferable to the extent provided in the Option
Agreement or as otherwise determined by the Committee.

(g) Termination of Employment or Service. Except as provided in the Initial
Option Grant or as may otherwise be provided by the Committee in the Option
Agreement other than with respect to the Initial Option Grant:

(i) If prior to the Expiration Date, a Participant’s employment or service, as
applicable, with the Employer terminates for any reason other than (A) by the
Employer for Cause, or (B) by reason of the Participant’s death or Disability,
(1) all vesting with respect to the Options shall cease, (2) any unvested
Options shall expire as of the date of such termination, and (3) any vested
Options shall remain exercisable until the earlier of the Expiration Date or the
date that is three (3) months after the date of such termination.

(ii) If prior to the Expiration Date, a Participant’s employment or service, as
applicable, with the Employer terminates by reason of such Participant’s death
or Disability, (A) all vesting with respect to the Options shall cease, (B) any
unvested Options shall expire as of the date of such termination, and (C) any
vested Options shall expire on the earlier of the Expiration Date or the date
that is twelve (12) months after the date of such termination due to death or
Disability of the Holder. In the event of a Participant’s death, the Options
shall remain exercisable by the person or persons to whom a Participant’s rights
under the Options pass by will or the applicable laws of descent and
distribution until its expiration, but only to the extent the Options were
vested by such Participant at the time of such termination due to death.

(iii) If prior to the Expiration Date, a Participant’s employment or service, as
applicable, with the Employer is terminated by the Employer for Cause, all
Options (whether or not vested) shall immediately expire as of the date of such
termination.

(h) Initial Option Grant. On the date that is thirty days following the
Effective Date, the individuals listed on the schedule approved by the Board of
Directors of Loral Space & Communications Ltd. to be granted Options pursuant to
the Plan upon the Company’s emergence from bankruptcy (the “Approved List”)
shall automatically be granted Options with respect to the number of shares
listed across from each individuals name on the Approved List. The Options
granted to those individuals identified as Senior Management on the Approved
List shall have such terms and conditions as set forth in the Option Agreement
for Senior Management, attached as Exhibit A to the Plan as in effect on
November 21, 2005. The Options granted to those individuals identified as
Non-Senior Management on the Approved List shall have such terms and conditions
as set forth in the Option Agreement for Non-Senior Management, attached as
Exhibit B to the Plan as in effect on November 21, 2005.

7. Stock Appreciation Rights.

(a) General. The Committee is authorized to grant SARs to Participants on the
following terms and conditions:

(i) Right to Payment. A SAR shall confer on the Participant to whom it is
granted a right to receive, upon exercise, or if necessary to conform to the
requirements of 409A, on each vesting date thereof, the value of the excess of
(A) the Fair Market Value of one share of Stock on the date of exercise over
(B) the grant price of the SAR as determined by the Committee.

(ii) Term. The term of each SAR shall be set by the Committee at the time of
grant; provided, however, that no SAR granted hereunder shall be exercisable
after the expiration of ten (10) years from the date it was granted.

(iii) Grant Price. The grant price per share of Stock for each SAR shall be set
by the Committee at the time of grant.

(iv) Other Terms. The Committee shall determine at the date of grant or
thereafter: (A) the time or times at which and the circumstances under which a
SAR may be exercised in whole or in part (including based on achievement of
performance goals and/or future service requirements); (B) the method of
exercise; (C) the method of settlement; (D) whether cash or Stock will be
payable to the Participant upon exercise of the SAR; (E) the method by or forms
in which Stock will be delivered or deemed to be delivered to Participants;
(F) whether or not a SAR shall be alone, in tandem or in combination with any
other Award; and (G) and any other terms and conditions of any SAR.

(b) Termination of Employment or Service. Except as may otherwise be provided by
the Committee in the applicable Award agreement:

(i) If prior to the Expiration Date, a Participant’s employment or service, as
applicable, with the Employer terminates for any reason other than (A) by the
Employer for Cause, or (B) by reason of the Participant’s death or Disability,
(1) all vesting with respect to the SARs shall cease, (2) any unvested SARs
shall expire as of the date of such termination, and (3) any vested SAR shall
remain exercisable until the earlier of the Expiration Date or the date that is
ninety (90) days after the date of such termination.

(ii) If prior to the Expiration Date, a Participant’s employment or service, as
applicable, with the Employer terminates by reason of such Participant’s death
or Disability, (A) all vesting with respect to the SARs shall cease, (B) any
unvested SARs shall expire as of the date of such termination, and (C) any
vested SARs shall expire on the earlier of the Expiration Date or the date that
is twelve (12) months after the date of such termination due to death or
Disability of the Holder. In the event of a Participant’s death, the SARs shall
remain exercisable by the person or persons to whom a Participant’s rights under
the SARs pass by will or the applicable laws of descent and distribution until
its expiration, but only to the extent the SARs were vested by such Participant
at the time of such termination due to death.

(iii) If prior to the Expiration Date, a Participant’s employment or service, as
applicable, with the Employer is terminated by the Employer for Cause, all SARs
(whether or not vested) shall immediately expire as of the date of such
termination, and such Participant shall have no further rights with respect
thereto.

8. Restricted Stock.

(a) General. Restricted Stock granted hereunder shall be in such form and shall
contain such terms and conditions as the Committee shall deem appropriate. The
terms and conditions of each Restricted Stock grant shall be evidenced by a
Restricted Stock Agreement, which agreements need not be identical. Subject to
the restrictions set forth in Section 8(b), except as otherwise set forth in the
applicable Restricted Stock Agreement, the Participant shall generally have the
rights and privileges of a stockholder as to such Restricted Stock, including
the right to vote such Restricted Stock. The Committee shall determine whether
or not dividends shall accrue on shares of Restricted Stock. At the discretion
of the Committee, cash dividends and stock dividends, if any, with respect to
the Restricted Stock may be either currently paid to the Participant or withheld
by the Company for the Participant’s account. A Participant’s Restricted Stock
Agreement may provide that cash dividends or stock dividends so withheld shall
be subject to forfeiture to the same degree as the shares of Restricted Stock to
which they relate. Except as otherwise determined by the Committee, no interest
will accrue or be paid on the amount of any cash dividends withheld.

(b) Restrictions on Transfer. In addition to any other restrictions set forth in
a Participant’s Restricted Stock Agreement, until such time that the Restricted
Stock has vested pursuant to the terms of the Restricted Stock Agreement, which
vesting the Committee may in its sole discretion accelerate at any time, the
Participant shall not be permitted to sell, transfer, pledge, or otherwise
encumber the Restricted Stock. Notwithstanding anything contained herein to the
contrary, the Committee shall have the authority to remove any or all of the
restrictions on the Restricted Stock whenever it may determine that, by reason
of changes in applicable laws or other changes in circumstances arising after
the date of the Restricted Stock Award, such action is appropriate.

(c) Certificates. Restricted Stock granted under the Plan may be evidenced in
such manner as the Committee shall determine. If certificates representing
Restricted Stock are registered in the name of the Participant, the Committee
may require that such certificates bear an appropriate legend referring to the
terms, conditions and restrictions applicable to such Restricted Stock, that the
Company retain physical possession of the certificates, and that the Participant
deliver a stock power to the Company, endorsed in blank, relating to the
Restricted Stock. Notwithstanding the foregoing, the Committee may determine, in
its sole discretion, that the Restricted Stock shall be held in book entry form
rather than delivered to the Participant pending the release of the applicable
restrictions.

(d) Termination of Employment or Service. Except as may otherwise be provided by
the Committee in the Restricted Stock Agreement, if, prior to the time that the
Restricted Stock has vested, a Participant’s employment or service, as
applicable, terminates for any reason, (i) all vesting with respect to the
Restricted Stock shall cease, and (ii) at any time following such termination,
and upon written notice to the Participant, the Company shall have the right to
repurchase from the Participant any unvested shares of Restricted Stock at a
purchase price equal to the original purchase price paid for the Restricted
Stock, or if the original purchase price is $0, such unvested shares of
Restricted Stock shall be forfeited by the Participant for no consideration.

9. Restricted Stock Units

(a) General. Restricted Stock Units granted hereunder shall be in such form and
shall contain such terms and conditions as the Committee shall deem appropriate.
The terms and conditions of each Restricted Stock Unit grant shall be evidenced
by a Restricted Stock Unit Agreement. No shares of Stock shall be issued at the
time a Restricted Stock Unit grant is made, and the Company will not be required
to set aside a fund for the payment of any such Award; provided, however, that
for purposes of Section 4(a) hereof, a share of Stock shall be deemed awarded at
the time of grant. The Committee shall determine whether or not dividends shall
accrue on Restricted Stock Units. If the Committee so determines, recipients of
Restricted Stock Units shall be entitled to an amount equal to the cash
dividends paid by the Company upon one share of Stock for each Restricted Stock
Unit then credited to such recipient’s account (“Dividend Equivalents”). The
Committee shall, in its sole discretion, determine whether to credit to the
account of, or to currently pay to, such Participant the Dividend Equivalents. A
Participant’s Restricted Stock Unit Agreement may provide that Dividends
Equivalents shall be subject to forfeiture to the same degree as the shares of
Restricted Stock Units to which they relate. Except as otherwise determined by
the Committee, no interest will accrue or be paid on Dividend Equivalents
credited to a recipient’s account.

(b) Conditions of Grant. Restricted Stock Units awarded to any Eligible Person
shall be subject to (i) forfeiture until the expiration of the restricted
period, to the extent provided in the Restricted Stock Unit Agreement, and to
the extent such Awards are forfeited, all rights of the recipient to such Awards
shall terminate without further obligation on the part of the Company, and
(ii) such other terms and conditions as may be set forth in the applicable Award
agreement. Notwithstanding anything contained herein to the contrary, the
Committee shall have the authority to remove any or all of the restrictions on
the Restricted Stock Units whenever it may determine that, by reason of changes
in applicable laws or other changes in circumstances arising after the date of
the Restricted Stock Unit Award, such action is appropriate.

(c) Settlement of Restricted Stock Units. Upon a date or dates on or following
the expiration of the restricted period as shall be determined by the Committee
and set forth in a Participant’s Restricted Stock Unit Agreement (the
“Settlement Date(s)”), unless earlier forfeited, the Company shall settle the
Restricted Stock Unit by delivering (i) a number of shares of Stock equal to the
number of Restricted Stock Units then vested and not otherwise forfeited, and
(ii) if applicable, a number of shares of Stock having a value equal to any
unpaid Dividend Equivalents accrued with respect to the Restricted Stock Units.
The Company may, in the Committee’s sole discretion, settle a Restricted Stock
Unit Award in (A) cash, (B) in the delivery of shares of Stock or other
property, (C) partially in cash and partially in the delivery of shares of Stock
and/or other property, or (D) partially in the delivery of shares of Stock and
partially in the delivery of other property. A settlement in cash or other
property shall be based on the value of the shares of Stock otherwise to be
delivered on the Settlement Date.

(d) Creditor’s Rights. A holder of Restricted Stock Units shall have no rights
other than those of a general creditor of the Company. Restricted Stock Units
represent an unfunded and unsecured obligation of the Company, subject to the
terms and conditions of the applicable Restricted Stock Unit Agreement.

(e) Termination of Employment or Service. Except as may otherwise be provided in
by the Committee in the Restricted Stock Unit Agreement, if, prior to the time
that the Restricted Stock Unit has vested, a Participant’s employment or
service, as applicable, terminates for any reason, all Restricted Stock Units
that have not vested on or prior the date of such termination shall be
forfeited, and vested Restricted Stock Units shall be settled as soon as
practicable following the date of such termination; provided, however, if such
Participant’s employment or service, as applicable, was terminated by the
Employer for Cause, all Restricted Stock Units, whether or not then vested,
shall be forfeited, and such Participant shall have no further rights with
respect thereto.

10. Bonus Stock and Awards in Lieu of Obligations.

The Committee is authorized to grant Stock as a bonus, or to grant Stock or
other Awards in lieu of obligations of the Company or a subsidiary of the
Company under the Plan or under other plans or compensatory arrangements,
subject to such terms and conditions as shall be determined by the Committee.

11. Other Stock-Based Awards.

The Committee is authorized, subject to limitations under applicable law, to
grant to Participants such other Awards that may be denominated or payable in,
valued in whole or in part by reference to, or otherwise based on, or related
to, Stock, as deemed by the Committee to be consistent with the purposes of the
Plan.

12. Adjustment for Recapitalization, Merger, etc.

(a) Capitalization Adjustments. In the event of any change in the outstanding
Stock or in the capital structure of the Company by reason of stock dividends or
extraordinary dividends payable in cash or any other form of consideration,
stock splits, reverse stock splits, recapitalizations, reorganizations, mergers,
consolidations, combinations, exchanges, or other relevant changes in
capitalization or any change in applicable laws or any change in circumstances
which results in or would result in any substantial dilution or enlargement of
the rights granted to, or available for, Participants in the Plan, the Committee
shall make such substitution or adjustment, if any, as is equitable and
proportional (as determined by the Committee in good faith), as to (i) the
number and/or kind of Stock or other securities issued or reserved for issuance
(including the maximum number and/or kind of Stock or other securities with
respect to which one person may be granted Options or SARs in any given year)
pursuant to the Plan or any outstanding Award, and/or (ii) the exercise price of
any Option or SAR. Absent manifest error, any adjustment shall be conclusively
determined by the Committee; provided, in each case, the fair value of the Award
immediately following any such adjustment shall be equal to the fair value of
the Award immediately prior to such adjustment.

(b) Fractional Shares. Any such adjustment may provide for the elimination of
any fractional share which might otherwise become subject to an Award.

13. Change in Control

(a) Change in Control of the Company. In the event of a Change in Control all
outstanding Awards shall become immediately vested and exercisable, the
restrictions thereon shall lapse and all such Awards shall become immediately
payable or subject to settlement. In the event of a Change in Control, it will
not be a violation of Section 19 hereunder for the Committee to cancel any or
all outstanding Awards in exchange for a cash payment to each Award holder
having a value equal to the value of each such Award at the time of such Change
in Control. Furthermore, it will not be a violation of Section 19 hereunder for
the Committee to cancel, without any such payment, any or all outstanding Awards
having no value at the time of such Change in Control.

(b) New Skynet or New SS/L Sale Event/Subsidiary Employees. In the event of a
New Skynet Sale Event, all outstanding Awards held by employees or service
providers of New Skynet shall become immediately vested and exercisable, the
restrictions thereon shall lapse and all such Awards shall become immediately
payable or subject to settlement. In the event of a New SS/L Sale Event, all
outstanding Awards held by employees or service providers of New SS/L shall
become immediately vested and exercisable, the restrictions thereon shall lapse
and all such Awards shall become immediately payable or subject to settlement.
Moreover, notwithstanding any limits on the exercisability of any Option
following a Participant’s termination of employment with New Skynet or New SS/L,
as applicable, as set forth in any Option Agreement, Options held by employees
or service providers of New Skynet or New SS/L, as applicable, shall remain
exercisable for the shorter of (i) one year following the New Skynet Sale Event
or New SS/L Sale Event, as applicable or (ii) the remaining term of the Option
as set forth in the Option Agreement.

(c) New Skynet or New SS/L Sale Event/Corporate Headquarters Employees. In the
event of a New Skynet Sale Event or a New SS/L Sale Event, (i) 50% of all
outstanding unvested Awards held by employees of the Company assigned to the
Company’s corporate headquarters shall become immediately vested and
exercisable, the restrictions thereon shall lapse and all such Awards shall
become immediately payable or subject to settlement if the New Skynet Sale Event
or a New SS/L Sale Event occurs on or prior to the first anniversary of the
Effective Date, or (ii) one-third of all outstanding unvested Awards held by
employees of the Company assigned to the Company’s corporate headquarters shall
become immediately vested and exercisable, the restrictions thereon shall lapse
and all such Awards shall become immediately payable or subject to settlement if
the New Skynet Sale Event or a New SS/L Sale Event occurs after the first
anniversary but on or prior to the second anniversary of the Effective Date.

(d) Change in Control under Section 409A. Notwithstanding anything herein to the
contrary, to the extent that any Award hereunder, either in whole or in part, is
deemed to provide for the deferral of compensation within the meaning of
Section 409A, there shall be no distribution of any such deferred compensation
on account of a Change in Control, a New Skynet Sale Event or a New SS/L Sale
Event unless such event also constitutes a “Change in Control Event” within the
meaning of Section 409A or such distribution is otherwise allowable under
Section 409A.

14. Use of Proceeds.

The proceeds received from the sale of Stock pursuant to the Plan shall be used
for general corporate purposes.

15. Rights and Privileges as a Stockholder.

Except as otherwise specifically provided in the Plan, no person shall be
entitled to the rights and privileges of stock ownership in respect of shares of
Stock which are subject to Awards hereunder until such shares have been issued
to that person.

16. Employment or Service Rights.

No individual shall have any claim or right to be granted an Award under the
Plan or, having been selected for the grant of an Award, to be selected for a
grant of any other Award. Neither the Plan nor any action taken hereunder shall
be construed as giving any individual any right to be retained in the employ or
service of the Company or an Affiliate.

17. Compliance With Laws.

The obligation of the Company to make payment of Awards in Stock or otherwise
shall be subject to all applicable laws, rules, and regulations, and to such
approvals by governmental agencies as may be required. Notwithstanding any terms
or conditions of any Award to the contrary, the Company shall be under no
obligation to offer to sell or to sell and shall be prohibited from offering to
sell or selling any shares of Stock pursuant to an Award unless such shares have
been properly registered for sale pursuant to the Securities Act with the
Securities and Exchange Commission or unless the Company has received an opinion
of counsel, satisfactory to the Company, that such shares may be offered or sold
without such registration pursuant to an available exemption therefrom and the
terms and conditions of such exemption have been fully complied with. The
Company shall be under no obligation to register for sale or resale under the
Securities Act any of the shares of Stock to be offered or sold under the Plan
or any shares of Stock issued upon exercise or settlement of Awards. If the
shares of Stock offered for sale or sold under the Plan are offered or sold
pursuant to an exemption from registration under the Securities Act, the Company
may restrict the transfer of such shares and may legend the Stock certificates
representing such shares in such manner as it deems advisable to ensure the
availability of any such exemption.

18. Withholding Obligations.

As a condition to the exercise or vesting, as applicable, of any Award, the
Committee may require that a Participant satisfy, through deduction or
withholding from any payment of any kind otherwise due to the Participant, or
through such other arrangements as are satisfactory to the Committee, the
minimum amount of all Federal, state and local income and other taxes of any
kind required to be withheld in connection with such vesting or exercise. The
Committee, in its discretion, may permit shares of Stock to be used to satisfy
tax withholding requirements and such shares shall be valued at their Fair
Market Value as of the settlement date of the Award.

19. Amendment of the Plan or Awards.

(a) Amendment of Plan. The Board at any time, and from time to time, may amend
the Plan; provided, however, that without further stockholder approval the Board
shall not make any amendment to the Plan which would increase the maximum number
of shares of Stock which may be issued pursuant to Awards under the Plan, except
as contemplated by Section 12 hereof, or, which would otherwise violate the
shareholder approval requirements of the national securities exchange on which
the Stock is listed or Nasdaq, as applicable.

(b) No Impairment of Rights. Rights under any Award granted before amendment of
the Plan shall not be impaired by any amendment of the Plan unless the
Participant consents in writing.

(c) Amendment of Stock Awards. The Committee, at any time, and from time to
time, may amend the terms of any one or more Awards; provided, however, that the
rights under any Award shall not be impaired by any such amendment unless the
Participant consents in writing.

20. Termination or Suspension of the Plan.

The Plan shall terminate on the day before the tenth (10th) anniversary of the
date the Plan is adopted by the Board and no Awards may be granted under the
Plan after it is terminated; provided, however, that the Plan shall continue to
be administered with respect to outstanding Awards until all such Awards have
been fully exercised or otherwise expire by their terms.

21. Effective Date of the Plan.

The Plan shall become effective as of the effective date of the Plan of
Reorganization.

22. Miscellaneous.

(a) Awards to Participants Outside of the United States. The Committee may
modify the terms of any Award under the Plan made to or held by a Participant
who is then resident or primarily employed outside of the United States in any
manner deemed by the Committee to be necessary or appropriate in order that such
Award shall conform to laws, regulations and customs of the country in which the
Participant is then resident or primarily employed, or so that the value and
other benefits of the Award to the Participant, as affected by foreign tax laws
and other restrictions applicable as a result of the Participant’s residence or
employment abroad, shall be comparable to the value of such Award to a
Participant who is resident or primarily employed in the United States. An Award
may be modified under this Section 22(a) in a manner that is inconsistent with
the express terms of the Plan, so long as such modifications will not contravene
any applicable law or regulation or result in actual liability under Section
16(b) of the Exchange Act for the Participant whose Award is modified.

(b) No Liability of Committee Members. No member of the Committee shall be
personally liable by reason of any contract or other instrument executed by such
member or on his behalf in his capacity as a member of the Committee nor for any
mistake of judgment made in good faith, and the Company shall indemnify and hold
harmless each member of the Committee and each other employee, officer or
director of the Company to whom any duty or power relating to the administration
or interpretation of the Plan may be allocated or delegated, against any cost or
expense (including counsel fees) or liability (including any sum paid in
settlement of a claim) arising out of any act or omission to act in connection
with the Plan unless arising out of such person’s own fraud or willful bad
faith; provided, however, that approval of the Board shall be required for the
payment of any amount in settlement of a claim against any such person. The
foregoing right of indemnification shall not be exclusive of any other rights of
indemnification to which such persons may be entitled under the Company’s
Certificate of Incorporation or By-Laws, as a matter of law, or otherwise, or
any power that the Company may have to indemnify them or hold them harmless.

(c) Payments Following Accidents or Illness. If the Committee shall find that
any person to whom any amount is payable under the Plan is unable to care for
his affairs because of illness or accident, or is a minor, or has died, then any
payment due to such person or his estate (unless a prior claim therefor has been
made by a duly appointed legal representative) may, if the Committee so directs
the Company, be paid to his spouse, child, relative, an institution maintaining
or having custody of such person, or any other person deemed by the Committee to
be a proper recipient on behalf of such person otherwise entitled to payment.
Any such payment shall be a complete discharge of the liability of the Committee
and the Company therefor.

(d) Designation and Change of Beneficiary. Each Participant may file with the
Company a written designation of one or more persons as the beneficiary who
shall be entitled to receive the rights or amounts payable with respect to an
Award due under the Plan upon his death. A Participant may, from time to time,
revoke or change his beneficiary designation without the consent of any prior
beneficiary by filing a new designation with the Committee. The last such
designation received by the Company shall be controlling; provided, however,
that no designation, or change or revocation thereof, shall be effective unless
received by the Company prior to the Participant’s death, and in no event shall
it be effective as of a date prior to such receipt. If no beneficiary
designation is filed by the Participant, the beneficiary shall be deemed to be
his or her spouse or, if the Participant is unmarried at the time of death, his
or her estate. Any beneficiary of the Participant receiving an Award hereunder
shall remain subject to the terms of the Plan and the applicable Award
agreement.

(e) Governing Law. The Plan shall be governed by and construed in accordance
with the internal laws of the State of Delaware without reference to the
principles of conflicts of laws thereof.

(f) Funding. No provision of the Plan shall require the Company, for the purpose
of satisfying any obligations under the Plan, to purchase assets or place any
assets in a trust or other entity to which contributions are made or otherwise
to segregate any assets, nor shall the Company maintain separate bank accounts,
books, records or other evidence of the existence of a segregated or separately
maintained or administered fund for such purposes. Participants shall have no
rights under the Plan other than as unsecured general creditors of the Company,
except that insofar as they may have become entitled to payment of additional
compensation by performance of services, they shall have the same rights as
other employees under general law.

(g) Reliance on Reports. Each member of the Committee and each member of the
Board shall be fully justified in relying, acting or failing to act, and shall
not be liable for having so relied, acted or failed to act in good faith, upon
any report made by the independent public accountant of the Company and its
Affiliates and upon any other information furnished in connection with the Plan
by any person or persons other than himself.

(h) Titles and Headings. The titles and headings of the sections in the Plan are
for convenience of reference only, and in the event of any conflict, the text of
the Plan, rather than such titles or headings shall control.

(i) Section 409A Compliance. To the extent that any payments or benefits
provided hereunder are considered deferred compensation subject to Section 409A,
the Company intends for this Agreement to comply with the standards for
nonqualified deferred compensation established by 409A (the “409A Standards”).
To the extent that any terms of the Plan would subject Participants to gross
income inclusion, interest or an additional tax pursuant to Section 409A, those
terms are to that extent superseded by the 409A Standards. The Company reserves
the right to amend Awards granted hereunder to cause such Awards to comply with
or be exempt from Section 409A.