While further negotiations remain scheduled between creditor advisors, SoftBank, OneWeb and Intelsat with respect to the company’s proposed merger-related exchange offers, the multibillion-dollar ad hoc group of Jackson noteholders represented by Houlihan Lokey and Kirkland & Ellis is developing a standalone exchange offer proposal for the 2019 and 2020 Jackson notes in the event that the company’s merger with OneWeb falls through, according to sources. Intelsat’s currently outstanding exchange offers and consent solicitations expire at midnight on May 10 after being extended last week.

Separately, certain Jackson 2019 and Jackson 2020 holders have been in discussions with advisors at Perella Weinberg and Stroock & Stroock in order to develop their own standalone proposal to extend the near-term Jackson maturities in the event the merger deal falls through, sources add. While Perella and Stroock earlier sought to organize a group of Jackson 2019 and 2020 bondholders to negotiate terms of merger exchange counterproposals, Intelsat chose to work with the broader Jackson ad hoc group, represented by Houlihan and Kirkland, which includes holders of each series of the Jackson notes.

Neither group has actually submitted an alternative standalone exchange proposal to the company, according to sources, who add that given the notes’ respective maturity dates, in the event the merger falls through, the company is more likely to discuss an alternative standalone proposal that addresses the 2019 notes as opposed to the 2020 notes.

As these standalone proposals are being developed among creditors and their advisors, merger exchange proposals are still being negotiated between OneWeb, SoftBank, Intelsat and bondholders, and it remains a possibility that the current exchange offers are either extended or modified, potentially with more coercive terms and a lower participation threshold (the threshold is currently 85% of outstanding principal of each series of notes), according to sources, who add that this would likely be accompanied by some increase in value offered by SoftBank. It is also possible that there is neither an extension nor a modification to terms, the sources warn.

The combination agreement indicates that Intelsat has agreed to refrain from officially engaging bondholders or their advisors in negotiations about alternative transactions while the company’s merger exchange offers remain outstanding.

SoftBank and OneWeb are separately being presented alternative options to enhance their satellite portfolio should the transaction with Intelsat fall through. At a meeting with bondholders last Friday, OneWeb and SoftBank’s advisors informed Jackson bondholders that third parties, including those with geosynchronous, or GEO, satellite capabilities, had reached out to OneWeb to propose alternative transactions in the case that the merger deal with Intelsat falls through, according to sources. Under the current merger terms, OneWeb seeks to combine its low earth orbit, or LEO, satellite fleet with Intelsat’s capabilities to create a “a hybrid of GEO and LEO satellite service.” PJT Partners acts as lead financial advisor to OneWeb and SoftBank.

Representatives from the Lux bondholder group, advised by White & Case and Centerview, were not in attendance at Friday’s meeting and have not been engaged by Intelsat’s advisors, sources add. Intelsat has, however, committed to paying fees for Houlihan and Kirkland in their capacity as advisors to the ad hoc Jackson group in the merger exchange negotiations, sources report.

SoftBank is not restricted from negotiating alternative transactions but cannot definitively agree to such an alternative deal until May 9, after which the obligation can be terminated (with the consent of Intelsat) upon “SoftBank’s reasonable determination that the Exchange Offer Condition is unlikely to be satisfied.”

The outside date for the combination and share purchase agreements is Feb. 28, 2018, with an early outside date of May 29, 2017, if the requisite tenders necessary to satisfy the exchange offer condition have not been obtained, according to publicly released excerpts from the company’s confidential offering memo dated March 24.