DD Support Board and Research Team

[1manband]

Does this mean shareholders lose everything?

In this case, no, they don't. Just most of it.

The answer to what happens to the common shares is included in the Plan of Reorganization. It is included in full in today's 8-K filing.

https://www.sec.gov/Archives/edgar/data/1525773/000119312521040121/0001193125-21-040121-index.htm

This is the specific language dealing with the common shares:

"Treatment: No distributions shall be made under the Plan in respect of Interests in Intelsat. On the Effective Date, Holders of Interests in Intelsat shall retain their Interests in Intelsat, subject to dilution by the equity distributions made pursuant to the Plan, and shall receive no distribution on account of such Interests."

In other words, shareholders get to keep their existing shares BUT will be diluted down substantially as the debtholders and other creditors will be receiving newly issued common shares. So how many shares are being issued?

Also from the Plan:

"The Equity Issuer will issue 95% of the authorized but unissued New Common Stock to Holders of Allowed Jackson Unsecured Claims, 3.043%, to Holders of ICF Unsecured Claims, and 1.957% to Holders of LuxCo Unsecured Claims, each subject to dilution in accordance with the Dilution Principles set forth in the Plan."

So, 100% of the authorized but unissued common shares will be issued under the Plan. They also get a lot of warrants, which will further dilute the existing common shareholders. According to the current articles, the company's authorized is 1 billion common shares with 142 million outstanding. So, 858 million new common shares will be issued, thus diluting existing shareholders down by 83.5% before the warrants are issued.

Assuming my math is correct, and the company is not raising the authorized, of course.