PALO ALTO, CALIF. - October 15, 2003 - Space Systems/Loral (SS/L), a subsidiary of Loral Space & Communications (OTCBB: LRLSQ), announced today that PanAmSat Corporation has agreed to issue SS/L an authorization to proceed (ATP) with the design and construction of a new satellite. Revenue for the construction of the satellite will be in excess of $100 million. In addition, PanAmSat has agreed to enter into an option for an in-orbit spare for one of its existing satellites on terms and conditions to be agreed to.

The ATP from PanAmSat is for the Galaxy 16 program, a C- and Ku-band satellite with 48 transponders to be delivered December 31, 2005.

At the same time, Hughes Electronics Corporation, majority owner of PanAmSat and parent of DIRECTV, notified Loral that the ATPs for two satellites previously issued to SS/L by DIRECTV are now fully enforceable and binding. Further, Hughes advised that DIRECTV will make advance payments of $25 million on each of those two satellite orders and PanAmSat will make an advance payment of $25 million on its new satellite order, for a combined total advance of $75 million. Proceeding with the construction of the satellite for PanAmSat and the two satellites for DIRECTV is subject to the approval of the Bankruptcy Court at a hearing scheduled for October 21, 2003.

In connection with this matter, on October 9, 2003, Loral received a proposal from EchoStar Communications Corporation to acquire the DIRECTV 7S satellite (now under construction) for $100 million and to provide ATPs for two additional satellites. Loral, however, has indicated that it intends to proceed with the DIRECTV and PanAmSat agreements rather than the EchoStar proposal.

Space Systems/Loral is a premier designer, manufacturer, and integrator of powerful satellites and satellite systems. SS/L also provides a range of related services that include mission control operations and procurement of launch services. Based in Palo Alto, Calif., the company has an international base of commercial and governmental customers whose applications include broadband digital communications, direct-to-home broadcast, defense communications, environmental monitoring, and air traffic control. SS/L is ISO 9001:2000 certified. For more information, visit www.ssloral.com.

Loral Space & Communications is a satellite communications company. Through its Skynet subsidiary, it owns and operates a global fleet of telecommunications satellites used by television and cable networks to broadcast video entertainment programming, and by communication service providers, resellers, corporate and government customers for broadband data transmission, Internet services and other value-added communications services. Loral also is a world-class leader in the design and manufacture of satellites and satellite systems through its Space Systems/Loral subsidiary.

This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In addition, Loral Space & Communications Ltd. or its representatives have made or may make forward-looking statements, orally or in writing, which may be included in, but are not limited to, various filings made by the company with the Securities and Exchange Commission, press releases or oral statements made with the approval of an authorized executive officer of the company. Actual results could differ materially from those projected or suggested in any forward-looking statements as a result of a wide variety of factors and conditions. These factors include those related to the filing, on July 15, 2003 by Loral and certain of its subsidiaries, of voluntary petitions for reorganization under Chapter 11 of Title 11 of the United States Code in the United States District Court for the Southern District of New York and parallel insolvency proceedings in the Supreme Court of Bermuda in which certain partners of KPMG were appointed as joint provisional liquidators. Additional factors and conditions are also described in the section of the company's annual report on Form 10-K for the fiscal year ended December 31, 2002, entitled "Certain Factors That May Affect Future Results," and the company's other filings with the Securities and Exchange Commission. The reader is specifically referred to these documents.