Loral Space & Communications Inc. Severance Policy
for Corporate Officers

Summary Plan Description/Plan Document

1. General Information

(a) The Loral Space & Communications Inc. Severance Policy for Corporate
Officers (the “Plan”) provides eligible employees of Loral Space &
Communications Inc. (the “Company”) with severance benefits if they are
terminated from employment with the Company for the reasons described herein.

(b) Notwithstanding any other provision of the Plan, the Plan supersedes any and
all prior plans, policies, or practices, written or oral, which may have
previously applied governing the payment of severance benefits to “Eligible
Employees” (as defined below).

(c) The Plan is adopted and effective as of June 14, 2006.

2. Eligibility

(a) You are an “Eligible Employee,” for purposes of this Plan, if (A) you are
the Chief Executive Officer of the Company (the “CEO”) or (B) (i) you are a
regular, full-time employee of the Company who is the President, Chief Operating
Officer, Chief Financial Officer, an Executive Vice President or a Vice
President of the Company, (ii) your primary place of employment is the Company’s
corporate headquarters located at 600 Third Avenue, New York, NY 10016,
(iii) you have been employed by the Company for at least six (6) months, and
(iv) you have been designated by the Plan Administrator (as defined below) to be
an Eligible Employee and have not thereafter been disqualified by the Plan
Administrator; provided, however, that if your terms and conditions of
employment are covered by a collective bargaining agreement (unless such
agreement provides for participation in the Plan) or you have entered into a
written agreement with the Company, or received an offer letter from the
Company, that provides for benefits upon termination of employment, and such
agreement or offer letter has not expired or lapsed, you shall not be considered
an “Eligible Employee” and shall not be eligible to participate in this Plan. No
individual other than the CEO shall be eligible to participate in the Plan as an
Eligible Employee unless and until such individual meets all of the requirements
of sub clauses (i), (ii) and (iii) of clause (B) above and such individual has
been designated as an Eligible Employee by the Plan Administrator and not
thereafter disqualified. The Plan Administrator shall provide each Eligible
Employee other than the CEO with written notice of his/her status as an Eligible
Employee and any disqualification from such status thereafter.

(b) You are a “Participant,” for purposes of this Plan, if you are an Eligible
Employee whose employment is terminated by the Company without “Cause” (as
defined in Section 4 below); provided, however, that you will not be entitled to
severance benefits if you:

(i) Are terminated for Cause;

(ii) Voluntarily resign; or

(iii) Cease to be an Eligible Employee due to death, disability or retirement;

(c) Notwithstanding anything in the Plan to the contrary, no Participant will be
eligible to receive any severance benefit or payment under the Plan unless and
until, prior to the receipt of a severance payment, the Participant executes a
general release of all claims against the Company and its subsidiaries and
affiliates satisfactory to the Company, and any applicable revocation period
described in such release has expired without such Participant having revoked
all or a portion of such release.

3. Severance Benefits

(a) Severance Benefit Amounts.

(i) Category I Employees. Subject to Section 3(b) below, in the event a
Participant who is a Category I Employee (a “Category I Participant”) becomes
entitled to benefits pursuant to Section 2(b), such Category I Participant shall
receive a lump sum payment (not subject to Mitigation), within twenty days
following such Category I Participant’s termination of employment with the
Company, equal to six months Pay. Subject to Section 3(b) below, to the extent
that such Category I Participant’s option agreements or other equity award
agreements or incentive compensation agreements with the Company provide for
less than full vesting upon such termination of employment with the Company,
such Category I Participant shall be entitled to accelerated vesting upon such
termination of employment of the next full tranche that would have vested on the
next vesting date following such termination for all of such Category I
Participant’s unvested options and other equity awards and incentive
compensation awards; provided, however, that if such Category I Participant
becomes entitled to benefits pursuant to Section 2(b) within six months
following a Corporate Event, such Category I Participant shall be entitled to
accelerated vesting upon such termination of employment of all outstanding
unvested options and other equity awards and incentive compensation awards
(unless the Plan Administrator, in his or its sole discretion, determines that
such termination of employment is not because such Category I Participant’s
position with the Company is no longer necessary or is redundant as a result of
such Corporate Event). Subject to Section 3(b) below, in the event a Category I
Participant is unemployed on the date that is six months following such Category
I Participant’s termination of employment with the Company or is employed on
such date but at a rate of pay less than such Participant’s rate of pay
immediately prior to such termination based on such Category I Participant’s
Pay, such Category I Participant shall, for a period of six months thereafter,
receive (subject to Mitigation) an amount equal to six months Pay in
substantially equal biweekly installments on the Company’s regular payroll
dates. Subject to Section 3(b) below, in the event a Category I Participant is
unemployed on the date that is twelve months following such Category I
Participant’s termination of employment with the Company or is employed on such
date but at a rate of pay less than such Category I Participant’s rate of pay
immediately prior to such termination based on such Category I Participant’s
Base Salary, such Category I Participant shall, for a period of twelve months
thereafter, receive (subject to Mitigation) an amount equal to twelve months
Base Salary in substantially equal biweekly installments on the Company’s
regular payroll dates.

(ii) Category II Employees. Subject to Section 3(b) below, in the event a
Participant who is a Category II Employee (a “Category II Participant”) becomes
entitled to benefits pursuant to Section 2(b), such Category II Participant
shall receive a lump sum payment (not subject to Mitigation), within twenty days
following such Category II Participant’s termination of employment with the
Company, equal to three months Pay. Subject to Section 3(b) below, to the extent
that such Category II Participant becomes entitled to benefits pursuant to
Section 2(b), such Category II Participant’s option agreements or other equity
award agreements or incentive compensation award agreements with the Company
provide for less than full vesting upon such termination of employment with the
Company, such Category II Participant shall be entitled to accelerated vesting
upon such termination of employment of the next full tranche that would have
vested on the next vesting date following such termination for all of such
Category II Participant’s unvested options and other equity awards and incentive
compensation awards; provided, however, that if such Category II Participant
becomes entitled to benefits pursuant to Section 2(b) within six months
following a Corporate Event, such Category II Participant shall be entitled to
accelerated vesting upon such termination of employment of all outstanding
unvested options and other equity awards and incentive compensation awards
(unless the Plan Administrator, in his or its sole discretion, determines that
such termination of employment is not because such Category II Participant’s
position with the Company is no longer necessary or is redundant as a result of
such Corporate Event). Subject to Section 3(b) below, in the event a Category II
Participant, is unemployed on the date that is three months following such
Category II Participant’s termination of employment with the Company or is
employed on such date but at a rate of pay less than such Category II
Participant’s rate of pay immediately prior to such termination based on such
Category II Participant’s Pay, such Category II Participant shall thereafter
receive (subject to Mitigation) an amount equal to (A) three months Pay plus
(B) two weeks Base Salary for every Year of Service plus (C) one-twelfth (1/12)
of two weeks Base Salary for every Month of Service in excess of such Category
II Participant’s full Years of Service, subject to a limit of twenty-six Years
of Service, in substantially equal biweekly installments on the Company’s
regular payroll dates for the number of biweekly pay periods derived by dividing
the sum of (A), (B) and (C) by such Category II Participant’s biweekly Base
Salary. Any fractional number resulting from such calculation shall be rounded
up to the nearest whole number.

(b) Discretionary Severance Option. Notwithstanding Section 3(a) above, in the
event any Participant becomes entitled to severance benefits pursuant to
Section 2(b), the Plan Administrator, in his or its sole discretion, may offer
such Participant an alternative severance benefit in lieu of the severance
benefit set forth in Section 3(a) above. In that event, the Participant will
have a choice between the severance benefits set forth in Section 3(a) and the
alternative severance benefit offered under this Section 3(b).

(c) Taxes on Severance Pay. The severance benefits pursuant to this Section 3
are considered taxable income. All appropriate federal, state and local taxes
will be withheld from all severance benefits.

(d) Severance Benefit Offsets. Notwithstanding anything herein to the contrary,
the amount of the severance benefit which any Participant is entitled to receive
under the Plan shall be the amount calculated in accordance with this Section 3
of the Plan, less all amounts, if any, which such Participant is entitled to
receive as a result of the circumstances of his or her termination under the
Federal Worker Adjustment and Retraining Notification Act (Pub. L. 100-379) and
other similar federal, state or local statute. Each Participant shall be
obligated to cooperate with and respond to the Company’s requests for
documentation, at any time such Participant is subject to Mitigation, relating
to any Compensation then earned by such Participant.

(e) Forfeiture of Severance Benefits. If the Plan Administrator determines, in
its sole discretion, after the commencement of severance benefits hereunder to
any Participant that (A) the Company had Cause to terminate such Participant’s
employment with the Company prior to actual termination, (B) such Participant
has failed to cooperate or respond to the Company’s request for documentation
relating to Compensation earned by such Participant, as required by
Section 3(d), or has falsely responded or (C) following termination of
employment, such Participant acts in a manner detrimental to the best interest
of the Company in any material respect, all rights to receive further severance
benefits will be forfeited.

(f) Continuation of Benefits in the Event of Death. In the event a Participant
dies after termination of employment with the Company but prior to receipt of
his or her entire severance benefit, the remaining portion of such severance
benefit shall continue to be paid, in the same form as it was scheduled to be
paid prior to death, to the Participant’s spouse, or if the Participant is not
married on the date of death, in a lump sum to the Participant’s estate.

4. Definitions. For purposes of the Plan, the following definitions shall apply:

(a) “Base Salary” with respect to any Participant, means such Participant’s
annual base salary in effect immediately prior to such Participant’s termination
of employment with the Company.

(b) “Break in Service” for any Participant shall mean the termination of such
Participant’s full-time employment with the Company followed by such
Participant’s re-employment with the Company on a full-time basis.

(c) “Category I Employees” shall consist of any Eligible Employee who is the
CEO, President, Chief Operating Officer, Chief Financial Officer, or an
Executive Vice President of the Company.

(d) “Category II Employees” shall consist of any Eligible Employee with the
title of Vice President.

(e) “Cause” shall have the meaning set forth in the Company’s 2005 Stock
Incentive Plan or any successor thereto. The determination of whether any
conduct, action or failure to act on the part of any Eligible Employee
constitutes Cause shall be made by the Plan Administrator in his or its sole
discretion.

(f) “Compensation” means compensation income derived from rendering services.

(g) “Corporate Event” means (i) a Change in Control (as defined in the Company’s
2005 Stock Incentive Plan), (ii) a New Skynet Sale Event (as defined in the
Company’s 2005 Stock Incentive Plan), (iii) a New SS/L Sale Event (as defined in
the Company’s 2005 Stock Incentive Plan), (iv) the merger, consolidation or
other business combination of the Company, Loral Skynet Corporation (“Skynet”),
Space Systems/Loral, Inc. (“SS/L”) or any of their subsidiaries with another
entity or (v) the acquisition by the Company, Skynet, SS/L or any of their
subsidiaries of all or substantially all of the stock or assets of another
entity.

(h) “Employment” means the state of being an employee, consultant, sole
proprietor, director or any other position (including self employment) through
which a Participant receives Compensation.

(i) “Mitigation” means the reduction of any severance benefits to which a
Participant is entitled to pursuant to Section 3 herein by an amount equal to
the Compensation then being received by such Participant from Employment with
any entity other than the Company.

(j) “Month” shall mean a period of 30 days.

(k) “Months of Service” shall mean a Participant’s completed full Months of
full-time employment with the Company. For purposes of this definition, a
Participant will receive credit for an additional full Month of Service in
excess of the number of full Months (of 30 days each) of full-time employment
with the Company to the extent he or she has at least an additional 16 days of
full-time employment with the Company.

(l) “Pay” with respect to any Participant means the sum of (x) the Participant’s
Base Salary plus (y) the average of the annual incentive bonus compensation paid
to the Participant in the two years immediately prior to the year of such
Participant’s termination of employment with the Company.

(m) “Prior Employment” for any Participant shall mean full-time employment with
the Company prior to one or more Breaks in Service for such Participant.

(n) “Section 409A” means Section 409A of the Internal Revenue Code of 1986, as
amended.

(o) “Year” shall mean a year consisting of 365 days (or 366 days for leap years)
(for example, an employee who is hired on September 7 and remains employed until
the following September 7 shall receive credit for a full Year, regardless of
whether such service spans a leap year).

(p) “Years of Service” shall mean a Participant’s completed full Years of
full-time employment with the Company measured from his/her date of hire by the
Company.

5. Administrative Information

(a) Plan Name. The full name of the Plan is the Loral Space & Communications
Inc. Severance Policy for Corporate Officers.

(b) Plan’s Sponsor. The Plan is sponsored by Loral Space & Communications Inc.,
600 Third Avenue, New York, NY 10016, (212) 697-1105.

(c) Employer Identification Number. The employer identification number
(EIN) assigned by the Internal Revenue Service to the Plan Sponsor is
87-0748324.

(d) Type of Plan and Funding. The Plan is a severance plan for the benefit of
employees of the Company who are members of a select group of management or
highly compensated employees. The benefits provided under the Plan are paid from
the Company’s general assets. No fund has been established for the payment of
Plan benefits. No contributions are required under the Plan.

(e) Plan Administrator.

(i) The Plan shall be administered by the CEO, provided, that, with respect to
the CEO, the Plan shall be administered by Compensation Committee of the Board
of Directors of the Company (the “Compenstion Committee”). The term “Plan
Administrator” shall refer to the CEO or the Compensation Committee, as
applicable.

(ii) The Plan Administrator has full responsibility for the operation of the
Plan. No supervisor or other officers of the Company are authorized to interpret
provisions of the Plan or make representations which are contrary to the
provisions of the Plan document as interpreted by the Plan Administrator. All
correspondence and requests for information should be directed as follows: Loral
Space & Communications Inc., Plan Administrator, Loral Space & Communications
Inc. Severance Policy for Corporate Officers, 600 Third Avenue, New York, NY
10016, (212) 697-1105.

(iii) Subject to the express provisions of this Plan, the Plan Administrator
shall have sole authority to interpret the Plan (including any vague or
ambiguous provisions) and to make all other determinations deemed necessary or
advisable for the administration of the Plan; provided, however that the Plan
Administrator shall have absolute discretion to determine whether, and the
extent to which, a Participant’s Prior Employment shall be considered in
determining such Participant’s Years of Service or Months of Service and such
determination may be different for different Participants under similar or
different circumstances. All determinations and interpretations of the Plan
Administrator shall be final, binding and conclusive as to all persons.

(f) Agent for Service of Process. Should it ever be necessary, legal process may
be served on the Plan Administrator at: Loral Space & Communications Inc., 600
Third Avenue, New York, NY 10016, Attn: General Counsel.

(g) Type of Administration. The Plan is administered by Loral Space &
Communications Inc.

(h) Plan Year. January 1 — December 31.

6. Plan Amendment or Termination. The Company reserves the right, in its sole
and absolute discretion to amend or terminate, in whole or in part, any or all
of the provisions of the Plan, including an amendment that reduces or eliminates
the benefits hereunder, by action of the Board of Directors of the Company (the
“Board”) (or a duly authorized committee thereof) at any time; provided,
however, that, following a Change in Control of the Company, as defined in the
Company’s 2005 Stock Incentive Plan, no termination or amendment of the Plan
that negatively impacts the rights or benefits of any Eligible Employee or
Participant hereunder shall be effective as to such Eligible Employee or
Participant and no Eligible Employee may be disqualified without such Eligible
Employee’s or Participant’s consent thereto; and further provided, however, that
any termination or amendment of the Plan, however, shall not negatively affect
the severance benefits payable under the Plan to any Participant whose
termination date has occurred prior to the date of the amendment or termination
of the Plan without such Participant’s consent.

7. Other Important Plan Information

(a) Employment Rights Not Implied. Participation in the Plan does not give any
Eligible Employee the right to be retained in the employ of the Company, nor
does it guarantee any right to claim any benefit except as outlined in the Plan.

(b) Governing Law. This Plan shall be construed and interpreted in accordance
with ERISA, to the extent applicable, and the laws of the State of Delaware,
without regard to the principles of conflicts of law thereof.

(c) No Liability. No director, officer, agent or employee of the Company shall
be personally liable in the event the Company is unable to make any payments
under the Plan due to a lack of, or inability to access, funding or financing,
legal prohibition (including statutory or judicial limitations) or failure to
obtain any required consent. In addition, neither the Plan Administrator nor any
employee, officer or director of the Company shall be personally liable by
reason of any action taken with respect to the Plan for any mistake of judgment
made in good faith, and the Company shall indemnify and hold harmless each
employee, officer or director of the Company, including the Plan Administrator,
to whom any duty or power relating to the administration or interpretation of
the Plan may be allocated or delegated, against any reasonable cost or expense
(including counsel fees) or liability (including any sum paid in settlement of a
claim with the approval of the Board of Directors of the Company) arising out of
any act or omission to act in connection with the Plan unless arising out of
such person’s own fraud, bad faith or gross negligence.

(d) 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 Plan to comply with the standards for nonqualified
deferred compensation established by Section 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 the Plan to ensure that benefits hereunder comply with or are
exempt from Section 409A. Notwithstanding any provision herein to the contrary,
any payment otherwise required to be made hereunder to a Participant at any date
as a result of the termination of the Participant’s employment shall be delayed
for such period of time as may be necessary to satisfy Section 409A(a)(2)(B)(i).
On the earliest date on which such delayed payments can be made without
violating the requirements of section 409A(a)(2)(B)(i), there shall be paid to
the Participant, in a single cash lump sum, an amount equal to the aggregate
amount of all payments delayed pursuant to the preceding sentence.

8. Claims Appeal Procedure

The following information is intended to comply with the requirements of ERISA
and provides the procedures an Eligible Employee may follow if he or she
disagrees with any decision about eligibility for Plan payments. The
determination by the Plan Administrator as to whether any person is an Eligible
Employee is final and binding and is not subject to review.

(a) An Eligible Employee will be informed as to whether or not he/she will be a
Participant under the Plan, and thereby entitled to benefits under the Plan, on
or before the last day worked. Eligible Employees who believe they are entitled
to benefits under the Plan and do not receive notice of their status as a
Participant, or who have questions about the amounts they receive, must write to
the Plan Administrator within thirty (30) days of the date of their respective
termination.

(b) If the Plan Administrator denies an Eligible Employee’s claim for benefits
under the Plan, the Eligible Employee will be sent a letter within ninety
(90) days (in special cases, more than 90 days may be needed and you will be
notified if this is the case) explaining:

(i) the specific reason or reasons for the denial;

(ii) the specific provisions on which the denial is based;

(iii) any additional material or information necessary for the Participant to
perfect the claim and an explanation of why such material or information is
necessary; and

(iv) an explanation of the Plan’s claim review procedure.

(c) If payment is denied or the Eligible Employee disagrees with the amount of
the payment, he or she may file a written request for review within sixty
(60) days after receipt of such denial. This request should be filed with the
Plan Administrator. The letter which constitutes the filing of an appeal should
ask for a review and include the reasons why the Eligible Employee believes the
claim was improperly denied, as well as any other appropriate data, questions,
or comments. In addition, an Eligible Employee is entitled to:

(i) review documents pertinent to his or her claim at such reasonable time and
location as shall be mutually agreeable to the Eligible Employee and the Plan
Administrator; and

(ii) submit issues and comments in writing to the Plan Administrator relating to
his or its review of the claim.

(d) A final decision will normally be reached within sixty (60) days, unless
special circumstances require an extension of time for processing, in which case
a decision will be rendered as soon as possible. The Eligible Employee will
receive a written notice of the decision on the appeal, indicating the specific
reasons for the decision as well as specific references to the Plan provisions
on which the decision is based.

9. The Plan Supersedes All Prior Severance Arrangements. Except as expressly
provided in a written employment or other agreement or written offer letter
between the Company and an individual, the Plan and the Loral Space &
Communications Inc. Severance Policy for Corporate Office Employees (the
“Severance Policies”) represent the only policies, plans, arrangements or
practices providing severance benefits upon termination of employment and the
Severance Policies supersede all prior written or oral policies, plans,
arrangements or practices providing severance benefits upon termination of
employment.