[Satellite TODAY 12-27-10] TerreStar Networks and its creditors have agreed to allow EchoStar to buy $125 million of preferred stock as part of TerreStar Network’s reorganization plan out of bankruptcy, the company announced Dec. 23.
    The agreement was reached during a New York State Bankruptcy Court hearing, where creditors were given until Feb. 7 to decide whether or not to participate. The court also agreed to give TerreStar until Feb. 2 to file its corporate governance plan. The confirmation hearing, at which the court will decide whether to put the reorganization in place, is scheduled for March 7.
    TerreStar Networks will conduct a preferred stock sale to raise cash to emerge from bankruptcy. Under the plan of reorganization, TerreStar’s debt will be converted to equity, and 97 percent of it would go to the current debt holders. Most of that value would go to EchoStar, which owns a majority of TerreStar’s $943.9 million of secured debt in the form of 15 percent bonds due in 2014.