Equity

9 Months Ended

Sep. 30, 2012

Equity

14. Equity

Special Dividend

On March 28, 2012, our Board of Directors declared a special dividend of $13.60 per share for an aggregate dividend of $418 million. The dividend was paid on April 20, 2012 to holders of record of Loral voting and non-voting common stock as of April 10, 2012.

In accordance with Loral’s stock incentive plan, an equitable adjustment was made to outstanding stock-based awards to reflect the special dividend. As a result, options outstanding increased by 19,058 and restricted stock units (“RSUs”) increased by 6,875. Certain RSU holders, who elected to receive the dividend in cash, will receive additional payments totaling $2.5 million on their RSU settlement dates.

On November 7, 2012, our Board of Directors declared a special distribution of $29.00 per share (see Note 1). In accordance with Loral’s stock incentive plan, an equitable adjustment will be made to outstanding stock-based awards to reflect the special distribution.

Treasury Stock

In November 2011, our Board of Directors authorized the purchase of up to 800,000 shares of our voting common stock. These purchases may be made from time to time in the open market or private transactions, as conditions may warrant. Under the repurchase program, as of December 31, 2011, we had purchased 136,494 shares of our voting common stock at a total cost of $8.4 million (an average cost of $61.54 per share), of which $0.5 million was settled in January 2012. For the period commencing January 1, 2012 and ending September 30, 2012, 18,000 shares were purchased for $1.2 million (an average cost of $66.22 per share), and, as of September 30, 2012, 154,494 shares were held at a total cost of $9.6 million (an average cost of $62.09 per share). We intend to hold repurchased shares of our voting common stock in treasury. We account for the treasury shares using the cost method.