NOTICE OF PROPOSED SETTLEMENT OF CLASS ACTION, HEARING ON PROPOSED SETTLEMENT AND ATTORNEYS FEE PETITION AND RIGHT TO SHARE IN SETTLEMENT FUND

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1 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK IN RE GLOBALSTAR SECURITIES LITIGATION 01 Civ (PKC) NOTICE OF PROPOSED SETTLEMENT OF CLASS ACTION, HEARING ON PROPOSED SETTLEMENT AND ATTORNEYS FEE PETITION AND RIGHT TO SHARE IN SETTLEMENT FUND TO: ALL PERSONS WHO PURCHASED OR OTHERWISE ACQUIRED DURING THE PERIOD DECEMBER 6, 1999 THROUGH OCTOBER 27, 2000, INCLUSIVE (THE CLASS PERIOD ) GLOBALSTAR TELECOMMUNICATIONS LIMITED COM- MON STOCK OR GLOBALSTAR, L.P./GLOBALSTAR CAPITAL CORPORATION SENIOR NOTES. PLEASE READ THIS NOTICE CAREFULLY AND IN ITS ENTIRETY. YOUR RIGHTS WILL BE AFFECTED BY PROCEEDINGS IN THESE ACTIONS. CLAIMS DEADLINE: CLAIMANTS MUST SUBMIT PROOFS OF CLAIM AND RELEASE, ON THE FORM ACCOMPANYING THIS NOTICE, POSTMARKED ON OR BEFORE JANUARY 6, EXCLUSION DEADLINE: REQUESTS FOR EXCLUSION MUST BE SUBMITTED POSTMARKED NO LATER THAN NOVEMBER 18, SECURITIES BROKERS AND OTHER NOMINEES: PLEASE SEE INSTRUCTIONS BELOW IN 56. SUMMARY OF PROPOSED SETTLEMENT AND RELATED MATTERS A. Purpose of this Notice 1. This notice is given pursuant to Rule 23 of the Federal Rules of Civil Procedure and an Order dated September 20, 2005 of the United States District Court for the Southern District of New York (the Court ). The purpose of this Notice is to inform you of the proposed Settlement of this Class Action (the Action ), of the terms of the proposed Settlement, which will affect all Class Members rights, and of a hearing to be held by the Court to consider the fairness, reasonableness and adequacy of the proposed Settlement. This Notice describes rights you may have under the proposed Settlement and what steps you may now take in relation to the Action. This Settlement Notice is not an expression of any opinion by the Court as to the merits of any claims or any defenses asserted by any party in the Action, or the fairness or adequacy of the proposed Settlement. B. Statement of Plaintiffs Recovery 2. Pursuant to the proposed Settlement described herein, a Settlement Fund consisting of twenty million dollars ($20,000,000) in cash, plus interest (the Gross Settlement Fund ), has been established. a. Plaintiffs estimate that there were approximately million shares of Globalstar Telecommunications Limited ( GTL ) common stock traded during the Class Period, which may have been damaged as a result of the alleged wrongdoing described below. While the parties do not agree on the average amount of damages per share that would be recoverable if Plaintiffs prevailed on all claims, Plaintiffs believe that the maximum amount recoverable would have been on average approximately $3.79 per share.

2 The likely average recovery per damaged share of GTL common stock under the proposed Settlement will substantially depend on the number of claims filed. Plaintiffs estimate that the average recovery per share will be in the range of $0.31 to $0.77 per share before deduction of Court awarded attorneys fees and expenses; however, such amount may be higher or lower. b. Plaintiffs are unable to estimate the face amount of Globalstar, L.P./Globalstar Capital Corporation Senior Notes traded during the Class Period which may have been damaged as a result of the alleged wrongdoing described below and which claims have not been released pursuant to the bankruptcy reorganization of those issuers. The Senior Notes issued by Globalstar, L.P. ( Globalstar ) and Globalstar Capital Corporation ( Globalstar Capital ) and traded during the Class Period are a) $500 million of % Senior Notes due 2004; b) $325 million of % Senior Notes due 2004; c) $325 million of % Senior Notes due 2004; and d) $300 million of % Senior Notes due While the parties do not agree on the average damage per Note that would be recoverable if Plaintiffs prevailed on all claims, Plaintiffs believe that the maximum amount recoverable per $1,000 face amount of each series of Globalstar/Globalstar Capital Senior Notes are those amounts set forth in the chart in paragraph 39(b) below. Because of the uncertainty created by the release in bankruptcy, Plaintiffs are not able to estimate the likely average recovery for purchasers of the four series of Senior Notes. 3. Under the relevant securities laws, a claimant s recoverable damages are limited to the losses attributable to the alleged securities law violations. Losses which resulted from factors other than an alleged securities law violations are not recoverable from the Settlement Fund. For purposes of the proposed Settlement herein, a Class Member s distribution from the Net Settlement Fund will be governed by the proposed Plan of Allocation described below at 36-43, or such other Plan of Allocation as may be approved by the Court. C. Statement of Potential Outcome of Case 4. The parties disagreed on both liability and damages and do not agree on the average amount of damages per security that would be recoverable if Plaintiffs were to have prevailed on each claim alleged. The issues on which the parties disagree include: (a) the appropriate economic model for determining the amount by which any GTL, Globalstar, or Globalstar Capital securities ( Globalstar securities ) were allegedly artificially inflated (if at all) during the relevant time period; (b) the amount by which any Globalstar securities were allegedly artificially inflated (if at all) during the relevant time period; (c) the effect of various market forces influencing the trading prices of the various Globalstar securities at various times during the relevant time period; (d) the extent to which external factors, such as general market and industry conditions, influenced the trading prices of each of the Globalstar securities at various times during the relevant time period; (e) the extent to which the various matters that Plaintiffs alleged were materially false or misleading influenced (if at all) the trading prices of the various Globalstar securities at various times during the relevant time period; (f) the extent to which the various allegedly adverse material facts that Plaintiffs alleged were omitted influenced (if at all) the trading prices of Globalstar securities at various times during the relevant time period; and (g) whether the statements made or facts allegedly omitted were false, misleading, material or otherwise actionable under the federal securities laws. 5. Plaintiffs Counsel recognizes that there are substantial obstacles that Plaintiffs and the Class would have had to overcome to prevail on their liability claims and that there were risks to establishing damages, including risks that the decline in the prices of Globalstar could be attributed, in whole or in part, to other, non-actionable, factors. Therefore, Plaintiffs could have recovered nothing or substantially less than the amount of the Settlement. For example, during the trial, the Court granted summary judgment to Defendant Bernard L. Schwartz with respect to purchases made during approximately the last three months of the Class Period, from July 20, 2000 through October 27, In addition, the Court, applying the ruling of the bankruptcy court overseeing Globalstar s bankruptcy, determined that a release provided in the bankruptcy reorganization plan of Globalstar and Globalstar Capital was effective against the claims of certain purchasers of Senior Notes during the Class Period who had claims for such Senior Notes under that bankruptcy plan, eliminating the claims of those Senior Notes purchasers. Most significantly, Plaintiffs faced the risk that the jury 2

3 that was empaneled to hear the case, and that heard evidence for seven days of trial, would return a verdict finding the defendant not liable in whole or in part for the injuries alleged by Plaintiffs, and/or that the jury would determine that Plaintiffs and the Class were entitled to little or no damages as a result of this verdict. 6. Defendant Schwartz denies that he is liable to the Plaintiffs or the Class and denies that Plaintiffs or the Class have suffered any damages. D. Statement of Attorneys Fees and Costs Sought 7. Plaintiffs Counsel intends to apply for fees of up to one-third (33 1 3%) of the Gross Settlement Fund, and for reimbursement of expenses incurred in connection with the prosecution of this Action in the approximate amount of $800,000 (exclusive of ongoing costs in conjunction with the administration of the Settlement). The requested fees and expenses would amount to an average of $.057 per damaged share of GTL common stock. Plaintiff s Counsel has expended considerable time and effort in the prosecution and trial of this litigation on a contingent fee basis, and has advanced the expenses of the litigation and trial, in the expectation that if they were successful in obtaining a recovery for the Class they would be paid from such recovery. In this type of litigation it is customary for counsel to be awarded a percentage of the common fund recovery as their attorneys fees. E. Further Information 8. Further information regarding the Action and this Settlement Notice may be obtained by contacting Plaintiff s Lead Counsel: Steven J. Toll, Esq. or Andrew N. Friedman, Esq., Cohen, Milstein, Hausfeld & Toll, P.L.L.C., 1100 New York Avenue, N.W., West Tower, Suite 500, Washington, D.C , Telephone: (202) ; or In re Globalstar Securities Litigation c/o Berdon Claims Administration LLC, P.O. Box 9014, Jericho, New York, , Telephone: (800) , Facsimile: (516) , Website: F. Reasons for the Proposed Settlement 9. The principal reasons for the proposed Settlement is the benefit to be provided to the Class of a certain settlement, compared to the risk that the Class would recover substantially less or nothing at all if the case were to be decided by the jury, and the benefit of providing a settlement to the Class now, compared to the risk that any verdict partially or wholly favorable to the Class would likely be appealed, delaying any recovery well into the future. NOTICE OF SETTLEMENT FAIRNESS HEARING 10. NOTICE IS HEREBY GIVEN, pursuant to Rule 23 of the Federal Rules of Civil Procedure and an Order of the United States District Court for the Southern District of New York, dated September 20, 2005, that a hearing will be held before the Honorable P. Kevin Castel, in the United States District Courthouse, 500 Pearl Street, Courtroom 12C, New York, New York at 10:00 a.m., on December 9, 2005 (the Settlement Fairness Hearing ) to determine whether a proposed settlement (the Proposed Settlement ) of the Action, as set forth in the Stipulation and Agreement of Settlement dated September 19, 2005 (the Stipulation ), is fair, reasonable and adequate, and to consider the proposed Plan of Allocation for the Settlement proceeds and the application of Plaintiffs Counsel for attorneys fees and reimbursement of expenses. BACKGROUND OF THE LITIGATION 11. Beginning on February 28, 2001, seventeen class actions alleging violations of federal securities laws were filed in the United States District Court for the Southern District of New York. After the seventeen actions were consolidated and selection of Plaintiffs Lawrence Phillips, Mark Phillips, Michael Phillips and Julianna Maio (the Phillips Family ) as the Lead Plaintiffs, a Consolidated Amended Class Action Complaint (the Complaint ) was filed on November 13,

4 12. Defendant Bernard L. Schwartz was the Chief Executive Officer and Chairman of Globalstar. Globalstar was a limited partnership founded by Loral Space & Communications Ltd. ( Loral ) along with Qualcomm Incorporated, to develop and provide a satellite-based global telecommunications network. GTL was formed to permit public equity ownership in Globalstar, and issued common stock for this purpose before and during the Class Period. The common stock traded on the NASDAQ exchange under the ticker symbol GSTRF. These corporate entities (Globalstar, GTL, and Loral as well as Globalstar Capital (collectively, Former Defendants )), were initially named as defendants in this Action but are no longer parties due to bankruptcy proceedings, as explained below. 13. Lead Plaintiffs in this Action, on behalf of the Class, generally have alleged that Defendant Schwartz, along with the Former Defendants made false and misleading statements regarding Globalstar s financial prospects and condition. In particular, Plaintiffs alleged that Defendant Schwartz and the Former Defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the Exchange Act ), and Rule 10b-5 promulgated thereunder, by knowingly or recklessly making false and misleading statements and omissions in several public statements during the period between December 6, 1999 and October 27, The Plaintiffs also alleged that Defendant Schwartz and the Former Defendants violated Sections 11 and 15 of the Securities Act of 1933 (the Securities Act ) by issuing a materially misleading registration statement and prospectus in January The particular false and misleading statements are set forth in Plaintiffs Consolidated Amended Class Action Complaint (the Complaint ). You may review a copy of the Complaint by visiting Lead Counsel s website at The Plaintiffs further alleged that Plaintiffs and the other Class Members purchased common stock issued by GTL and Senior Notes issued by Globalstar and Globalstar Capital during the Class Period at prices that were artificially inflated as a result of the dissemination by Defendant Schwartz and the Former Defendants of materially false and misleading statements regarding Globalstar in violation of Sections 10(b) and 20(a) of the Exchange Act and Rule 10b-5 promulgated thereunder, and in violation of Sections 11 and 15 of the Securities Act. 15. Defendant Schwartz has denied and continues to deny all of the Plaintiffs allegations of wrongdoing. SUBSEQUENT EVENTS 16. In 2001, Globalstar and Globalstar Capital filed for bankruptcy protection and, on June 17, 2004, the Bankruptcy Court confirmed the Debtors plan of reorganization, as amended ( Globalstar Reorganization Plan ). GTL also sought protection under Chapter 7 of the Bankruptcy Code and was liquidated thereafter. As a result of the bankruptcy filings, which stayed all claims against GTL, Globalstar and Globalstar Capital, and the Globalstar Reorganization Plan, which discharged and released the claims of purchasers of Globalstar securities against any and all of the Debtors, and GTL s liquidation, GTL, Globalstar and Globalstar Capital are no longer parties to this Action. The Globalstar Reorganization Plan further provided that holders of Senior Notes as of the effective date of the reorganization plan released their securities claims against the Debtors, Defendant Schwartz, and others. Accordingly, those Class Members who held Globalstar Senior Notes as of the distribution record date of June 21, 2004 under the Globalstar Reorganization Plan were determined to have released their claims for purchases of Senior Notes that might be otherwise cognizable under the Settlement. However, Plaintiffs believe there is nonetheless some value attributable to such claims, and such purchasers may claim a distribution from the Settlement Fund. Due to this release, the recognized claim of such purchasers shall be discounted such that purchasers of Globalstar Senior Notes who held such Notes as of June 21, 2004, shall be allotted 25% of the Recognized Claim that would otherwise be calculated by the plan of allocation set forth below for such Notes. Class Members who purchased Senior Notes and did not hold such notes as of June 21, 2004 will receive the full pro rata allocation of their recognized loss. 4

5 17. In 2003, Loral filed for bankruptcy protection, and on August 1, 2005, the Bankruptcy Court confirmed the Debtors plan of reorganization. As a result of the bankruptcy filing, which stayed all claims against Loral, and the amended plan of reorganization, which discharged and released the claims of purchasers of Globalstar securities against Loral, Loral is no longer a party to this Action. 18. As a result of the bankruptcies of the four former corporate defendants, the only remaining defendant to this Action was and is Defendant Bernard L. Schwartz. Defendant Schwartz, referred to below as the Settling Defendant, has entered into the Settlement described herein. BACKGROUND TO THE PROPOSED SETTLEMENT 19. This Action was the subject of a jury trial which lasted for nearly two weeks before the Settlement was reached during Defendant s case. Plaintiffs had presented and rested their case to a jury of ten persons empaneled by Judge P. Kevin Castel in the United States District Court for the Southern District of New York located in New York City. Plaintiffs claims under Sections 11 and 15 of the Securities Act were dismissed as a matter of law pursuant to Defendant s motion, and the period for which damages could be claimed at the trial had been curtailed by evidentiary and other rulings that could have substantially reduced the recovery to the Class. Moreover, prior to the start of the trial, the Court partially granted the Settling Defendant s motion for summary judgment, dismissing the Action with respect to Globalstar securities purchased between July 20, 2000 and October 27, 2000, inclusive. Further, the Court, applying the ruling of the bankruptcy court overseeing Globalstar s bankruptcy, determined that certain purchasers of Globalstar/Globalstar Capital Senior Notes had released their claims against the Defendant arising from those Senior Note purchases pursuant to the release contained in the bankruptcy reorganization plan of those entities. 20. The Settling Defendant has denied all averments of wrongdoing or liability in the Action and all other accusations of wrongdoing or violations of law. The Proposed Settlement is not and shall not be construed or be deemed to be evidence or an admission or a concession on the part of the Settling Defendant of any fault or liability or damages whatsoever, and the Settling Defendant does not concede any infirmity in the defenses which he has asserted or intended to assert in the Action. 21. Prior to entering into the proposed Settlement, Plaintiffs Counsel conducted a thorough investigation relating to the events and transactions underlying Plaintiffs claims, conducted extensive discovery, acted to oppose Settling Defendant s motion for summary judgment, and litigated this case through seven days of trial, up to and including all of Plaintiffs case in chief, Settling Defendant s motion for judgment as a matter of law, and a substantial portion of Settling Defendant s case in opposition. Plaintiffs Counsel s decision to enter into this proposed Settlement was made with full knowledge of the facts and circumstances underlying Plaintiffs claims and the strengths and weaknesses of those claims. In determining to settle this litigation, they have taken into account the substantial risks of having part or all of Plaintiffs claims dismissed if the Court granted Settling Defendant s motion for judgment as a matter of law in whole or in part, and the substantial risk that the jury would render a verdict partially or wholly in favor of the Settling Defendant with respect to liability and/or damages. Along with these significant risks, Plaintiffs Counsel has also considered the expense and length of time necessary to prosecute the litigation through the end of trial, post-trial motions, and likely appeals, taking into consideration the significant uncertainties in predicting the outcome of this complex litigation. 22. Counsel for Plaintiffs believes that the proposed Settlement described herein confers very substantial benefits upon the Class. Based upon their consideration of all of these factors, Plaintiffs and their counsel have concluded that it is in the best interests of Plaintiffs and the Class to settle the Action on the terms described herein. 23. Plaintiffs recognized the uncertainty and the risk of the outcome of any litigation, especially complex litigation such as this, and the difficulties and risks inherent in the outcome of the ongoing trial of this Action. Plaintiffs desired to settle the claims of the Class against the Settling Defendant on the terms and conditions 5

6 described herein which provide substantial benefits to the Class. Plaintiffs Counsel deems such settlement to be fair, reasonable and adequate, and in the best interests of the members of the Class. 24. The Settling Defendant has denied, and continues to deny, all allegations of wrongdoing, violations of law or liability made by Plaintiffs in the Action. The Settling Defendant has expressly denied that he made any misstatements, that the price of any Globalstar security was artificially inflated by reason of any alleged misstatement, or that the Class was harmed by the conduct alleged in the Action. The proposed Settlement is not, and shall not be, construed or be deemed to be evidence or an admission or a concession on the part of the Settling Defendant of any fault or liability or damages whatsoever, and the Settling Defendant does not concede any infirmity in the defenses that he has asserted or intended to assert in the Action. 25. Nevertheless, while continuing to deny all allegations of wrongdoing or liability whatsoever, the Settling Defendant desires to settle and terminate all existing or potential claims against him, without in any way acknowledging any fault or liability. 26. The amount of damages, if any, that Plaintiffs could prove was also a matter of serious dispute, and the proposed Settlement s use of a Recognized Claim formula for distributing the Settlement proceeds does not constitute a finding, admission or concession that provable damages could be measured by the Recognized Claim formula. No determination has been made by the Court as to liability or, the amount, if any, of damages suffered by the Class, or the proper measure of any such damages. The determination of damages, like the determination of liability, is a complicated and uncertain process, typically involving conflicting expert opinions. The proposed Settlement herein provides an immediate and substantial cash benefit and avoids the risks that liability or damages might not have been proven at trial. 27. The Court has not determined the merits of the Plaintiffs claims or the defenses thereto. This Settlement Notice does not imply that there has been or would be any finding of violation of the law or that recovery could be had in any amount if the Action was not settled. TERMS OF THE PROPOSED SETTLEMENT 28. On December 1, 2004, the Court conditionally ordered the certification of a class of Globalstar securities purchasers (the Class ). The Class consists of all persons and entities who purchased or otherwise acquired Globalstar Telecommunications, Ltd. ( GTL ), Globalstar Capital Corporation ( Globalstar Capital ), or Globalstar, L.P. ( Globalstar ) securities between December 6, 1999 and October 27, 2000, inclusive, and were damaged thereby (the Class ). Excluded from the Class are the defendants named in Plaintiffs Consolidated Amended Class Action Complaint GTL, Globalstar Capital, Globalstar, Loral Space & Communications Ltd., and Bernard Schwartz (collectively, Defendants) members of the immediate family of each of the Defendants, any person, firm, trust, corporation, officer, director or other individual or entity of which any Defendant has a controlling interest or which is related to or affiliated with any of the Defendants, including all partners of Globalstar, and the legal representatives, agents, affiliates, heirs, successors-in-interest or assigns of any such excluded party. Related to or affiliated with means all partners of Globalstar, L.P., including legal and otherwise, Globalstar service providers, Globalstar, Schwartz or Loral controlled companies, subsidiaries, joint ventures, joint subsidiaries, or other entities with common corporate ownership or control. Also excluded from the Class are any putative Class Members who have properly requested exclusion from the Class in response to a prior notice in this Action (the Notice of Pendency ) or who exclude themselves by filing a request for exclusion in accordance with the requirements set forth in this Notice. If you have previously requested exclusion from the Class, you need not and should not request exclusion again. 29. In full and complete settlement of the Settled Claims (as defined below), and subject to the terms and conditions of the Stipulation, Settling Defendant caused to be paid $20 million (the Cash Settlement Amount ) into escrow on behalf of Plaintiffs and the Class. 6

7 30. Pursuant to the proposed Settlement, and on the Effective Date, Plaintiffs and other members of the Class who do not exclude themselves therefrom on behalf of themselves, their heirs, executors, administrators, successors and assigns, shall release and forever discharge, and shall forever be enjoined from prosecuting each and every Settled Claim (defined below) against the Released Parties (defined below). 31. The Settling Defendant is Bernard L. Schwartz, who shall be released from all Settled Claims, as defined below. In addition, the proposed Settlement will release all Class Members Settled Claims against any and all of the Defendants and their respective present and former affiliates, predecessors, successors, and assigns, and each of their respective family members, heirs, executors, and administrators, and any corporate entity affiliated with any of the Defendants, including but not limited to Loral, Globalstar, GTL, and Globalstar Capital, each of their present and former officers, directors, employees, partners, principals, trustees, attorneys, auditors, accountants, investment bankers, consultants, agents, insurers and co-insurers and each of their respective heirs, executors, administrators, predecessors, successors (including but not limited to successors in bankruptcy) and assigns (collectively, the Released Parties ). 32. Settled Claims means any and all claims, demands, rights, liabilities and causes of action of every nature and description whatsoever, known or Unknown (as Unknown Claims is defined herein), including but not limited to the Class Claim filed by Lead Plaintiffs in the Chapter 11 proceeding entitled In re: Loral Space & Communications Ltd., et al., lead Case No (RDD) pending in the United States Bankruptcy Court, Southern District of New York, whether or not concealed, including claims for negligence, gross negligence, breach of fiduciary duty or care and/or breach of duty of loyalty, fraud or violations of any state or federal statutes, rules or regulations, by any individual, derivative or class plaintiff against Defendants and the Released Parties arising out of, based upon or related to the purchase of GTL common stock and Globalstar and Globalstar Capital Senior Notes during the Class Period and the facts, transactions, events, occurrences, acts disclosures, statements, omissions or failures to act that were or could have been alleged in the Action. 33. Unknown Claims means any and all Settled Claims which Plaintiffs or any Class Member does not know or suspect to exist in his, her or its favor at the time of the release of the Released Parties, and any Settled Defendant s Claims which the Settling Defendant does not know or suspect to exist in his favor, which if known by him might have affected his decision(s) with respect to the proposed Settlement. With respect to any and all Settled Claims and Settled Defendant s Claims, the parties stipulate and agree that upon the Effective Date, the Plaintiffs and the Settling Defendant shall expressly, and each Class Member shall be deemed to have, and by operation of the Order and Final Judgment shall have, expressly waived any and all provisions, rights and benefits conferred by any law of any state or territory of the United States, or principle of common law, which is similar, comparable, or equivalent to Cal. Civ. Code 1542, which provides: A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor. 34. If the proposed Settlement is approved by the Court, all Settled Claims will be dismissed on the merits and with prejudice as to all Class Members and all Class Members shall be forever barred from prosecuting a class action or any other action raising any Settled Claims against any of the Released Parties. 35. The proposed Settlement will become effective at such time as an Order entered by the Court approving the Settlement shall become final and not subject to appeal (the Effective Date ). PROPOSED PLAN OF ALLOCATION OF SETTLEMENT PROCEEDS AMONG CLASS MEMBERS 36. The $20 million Cash Settlement Amount and the interest earned thereon shall be the Gross Settlement Fund. The Gross Settlement Fund, less all taxes, approved costs, fees and expenses (the Net Settlement Fund ) shall be distributed to members of the Class who submit acceptable Proofs of Claim and Release ( Authorized Claimants ). 7

8 37. The Claims Administrator, Berdon Claims Administration LLC, shall determine each Authorized Claimant s pro rata share of the Net Settlement Fund based upon each Authorized Claimant s Recognized Claim. The Recognized Claim formula is not intended to be an estimate of the amount that a Class Member might have been able to recover after a trial; nor is it an estimate of the amount that will be paid to Authorized Claimants pursuant to the Settlement. The Recognized Claim formula is the basis upon which the Net Settlement Fund will be proportionately allocated to the Authorized Claimants. 38. The following proposed Plan of Allocation reflects the Court s partial grant of the Settling Defendant s motion for summary judgment, dismissing the Action with respect to Globalstar securities purchased between July 20, 2000 and October 27, 2000, inclusive. There will be no Recognized Claim with respect to any Globalstar securities purchased during that period. The plan of allocation further recognizes the Court s granting of a motion in limine filed by Defendant which enforced the release in bankruptcy against certain purchasers of Globalstar Senior Notes who had claims for such Notes in the Globalstar bankruptcy proceedings. With respect to the remainder of the Class Period, wherein Plaintiffs allege the Settling Defendant made material misrepresentations that inflated the prices of Globalstar securities, Settling Defendant denies that he made any material misrepresentations or omitted to disclose any material information and asserts that he is not liable to Plaintiffs and the Class for anything. Without admitting any liability, the Settling Defendant further contends that even if liability were shown, the Plaintiffs and the Class suffered no compensable damages. The Settling Defendant asserts that the prices of Globalstar securities were not artificially inflated during the relevant period and that the prices of its securities reflected market valuations prevalent at that time. The Court did not make any finding that the Settling Defendant is liable to Plaintiffs or the Class, or that the Plaintiffs or the Class have suffered any compensable damages. 39. Berdon Claims Administration shall determine each Authorized Claimant s pro rata share of the Net Settlement Fund based upon each Authorized Claimant s Recognized Claim calculated under the following formulae: 1 Common Stock a. Recognized Claims shall be calculated using the following amounts per share for shares purchased during the period indicated and sold during the period indicated, or the difference in the purchase price of the shares and the selling price of the shares, whichever is less; except that for shares held as of the close of trading on July 19, 2000, the Recognized Claim per share shall be the lesser of the amount shown below or: for shares sold during the period July 20, 2000 through October 18, 2000, the difference between the purchase price and the greater of the selling price or $8.529; or, for shares held as of the close of trading on October 18, 2000, the difference between the purchase price and $ [SEE TABLE ON FOLLOWING PAGE] 1 Pursuant to the Private Securities Litigation Reform Act, plaintiffs damages are limited in securities class actions by the mean stock trading price for the 90-day period subsequent to the corrective disclosure. Similarly, if the plaintiff sold the stock in the same 90-day period, his or her damages may not exceed the difference between the sale price and the mean trading price of the security during the 90-day period. Because the Court granted summary judgment as to the period July 20, 2000 through the end of the Class Period, October 27, 2000, the 90-day period in this case starts on July 20, 2000 and ends on October 18,

9 Sale Dates 12/6/99-2/23/00-3/7/00-3/10/00-3/25/00-5/5/00-5/9/00 - Held as of 3/9/00 2/22/00 3/6/00 3/8/00 3/24/00 5/4/00 5/8/00 7/19/00 7/19/0 12/6/99-2/22/00 $0.000 $0.000 $0.000 $2.444 $4.222 $5.670 $6.433 $7.549 $ /23/00-3/6/00 $0.000 $3.812 $7.006 $8.784 $ $ $ $ /7/00-3/8/00 $0.000 $3.194 $4.972 $6.420 $7.183 $8.299 $ /9/00 $0.000 $1.778 $3.226 $3.989 $5.105 $ /10/00-3/24/00 $0.000 $1.448 $2.211 $3.327 $ /25/00-5/4/00 $0.000 $0.763 $1.879 $ /5/00-5/8/00 $0.000 $1.116 $ /9/00-7/19/00 $0.000 $1.235 Purchase Dates 9

10 Senior Notes b. Recognized Claims for Senior Notes purchases for which no release has been given pursuant to the Globalstar Reorganization Plan shall be calculated using the following amounts per $1,000 face value of senior note purchased during the period indicated and sold during the period indicated, or the difference in the purchase price of the notes and the selling price of the notes, whichever is less; except that for notes held as of the close of trading on July 19, 2000, the Recognized Claim per $1,000 face value of senior note shall be the lesser of the amount shown below or: for notes sold during the period July 20, 2000 through October 18, 2000, the difference between the purchase price and the greater of the selling price or $28.69; or, for notes held as of the close of trading on October 18, 2000, the difference between the purchase price and $ For class members who held Senior Notes on June 21, 2004, and whose claims were determined to have been released pursuant to the bankruptcy plan of reorganization of Globalstar, the Recognized Claim on all Senior Notes purchased during the Class Period shall be reduced such that the Recognized Claims for such purchases shall be 25% of the Recognized Claim calculated as above. [SEE TABLE ON FOLLOWING PAGE] 10

11 Sale Dates 12/6/99-2/23/00-3/7/00-3/10/00-5/5/00-5/9/00 - Held as of 3/9/00 2/22/00 3/6/00 3/8/00 5/4/00 5/8/00 7/19/00 7/19/00 12/6/99-2/22/00 $0.00 $0.00 $0.00 $50.90 $72.63 $62.83 $ $ /23/00-3/6/00 $0.00 $20.33 $92.82 $ $ $ $ /7/00-3/8/00 $0.00 $72.49 $94.22 $84.42 $ $ /9/00 $00.00 $21.73 $11.93 $53.86 $ /10/00-5/4/00 $0.00 $0.00 $32.13 $ /5/00-5/8/00 $0.00 $41.93 $ /9/00-7/19/00 $0.00 $9.80 Purchase Dates 11

12 40. In processing claims, the following criteria will be used: a. The first-in-first-out ( FIFO ) basis will be applied to purchases and sales. b. Transactions resulting in recognized gains will be excluded from calculation of the net Recognized Claim. c. Where securities were purchased or sold by reason of having exercised an option or warrant, the cost/proceeds associated with such option or warrant shall be incorporated into the price accordingly. d. Shares originally sold short shall have a Recognized Claim of zero. e. No cash payments will be made on a claim where the potential distribution amount is $5.00 or less. 41. Each Authorized Claimant shall be allocated a pro rata share of the Net Settlement Fund based on his, her or its Recognized Claim as compared to the total Recognized Claims of all Authorized Claimants. 42. Class Members who do not submit timely, acceptable and valid Proofs of Claim and Release are not Authorized Claimants and will not share in the settlement proceeds, but will nevertheless be bound by the Settlement and by the Order and Final Judgment of the Court dismissing this Action. 43. Checks will be distributed to Authorized Claimants after all claims have been processed and after the Court has finally approved the Settlement. If any funds remain in the Net Settlement Fund by reason of uncashed checks or otherwise, then, after Berdon Claims Administration has made reasonable and diligent efforts to have Class Members, who are entitled to participate in the distribution of the Net Settlement Fund, cash their distribution checks, any balance remaining in the Net Settlement Fund one (1) year after the initial distribution of such funds shall be redistributed to Class Members who have cashed their checks and who would receive at least $5.00 each from such redistribution. If, after six months after such redistribution any funds shall remain in the Net Settlement Fund, then such balance shall be contributed to non-sectarian, notfor-profit, 501(c)(3) organization(s) designated by agreement of Plaintiffs Lead Counsel and counsel for the Settling Defendant. THE RIGHTS OF CLASS MEMBERS 44. Class Members shall be bound by all determinations and judgments in this Action, whether favorable or unfavorable, unless such persons request exclusion from the Class in a timely and proper manner, as hereinafter provided. A Class Member wishing to make such request shall mail the request in written form by first-class mail postmarked no later than November 18, 2005 to: In re Globalstar Securities Litigation c/o Berdon Claims Administration LLC P.O. Box 9014 Jericho, New York Such request for exclusion shall clearly indicate the name and address of the person seeking exclusion, that the sender requests to be excluded from the Class in the Globalstar Securities Litigation, and must be signed by such person. Such persons requesting exclusion are also requested to state: their telephone number and the date(s), price(s), and number(s) of shares of all purchases and sales of Globalstar securities during the Class Period. The request for exclusion shall not be effective unless it provides the required information and is made within the time stated above, or the exclusion is otherwise accepted by the Court. 46. Class Members requesting exclusion from the Class shall not be entitled to receive any payment out of the Net Settlement Fund as described herein. Class Members who have previously requested exclusion from the Class need not make an additional request for exclusion, and will not share in the distribution of the Net Settlement Fund. 12

13 SUBMISSION AND PROCESSING OF PROOFS OF CLAIM 47. In order to be eligible to receive any distribution from the Net Settlement Fund, you must complete and sign the accompanying Proof of Claim and Release form and send it by first class mail postmarked on or before January 6, 2006, addressed as follows: In re Globalstar Securities Litigation c/o Berdon Claims Administration LLC P.O. Box 9014 Jericho, New York If you do not submit an acceptable Proof of Claim and Release, you will not be entitled to any share of the Net Settlement Fund. 49. All Proofs of Claim and Release must be submitted by the date specified in this Notice unless such period is extended by Order of the Court. 50. Each Claimant shall be deemed to have submitted to the jurisdiction of the United States District Court for the Southern District of New York with respect to his, her or its Proof of Claim and Release. FINAL APPROVAL HEARING 51. At the Final Approval Hearing, the Court will determine whether to finally approve this proposed Settlement and dismiss the Action and the claims of the Plaintiffs and the Class Members. The Court will also determine whether the proposed Plan of Allocation for the Settlement proceeds is fair and reasonable. The Final Approval Hearing may be adjourned from time to time by the Court without further written notice to the Class. If you intend to attend the Final Approval Hearing, you should confirm the date and time with Plaintiffs Lead Counsel. If the Settlement is approved, the Court will also consider the application of Plaintiffs Counsel for attorneys fees and reimbursement of costs and expenses. 52. At the Final Approval Hearing, any Class Member who has not submitted a request for exclusion from the Class, as described in above, may appear in person or by counsel and be heard to the extent allowed by the Court in opposition to the fairness, reasonableness and adequacy of the proposed Settlement, the proposed Plan of Allocation, or the application for an award of attorneys fees and reimbursement of expenses. However, in no event shall any person be heard in opposition to the proposed Settlement, the proposed Plan of Allocation, or Plaintiffs Counsel s application for attorneys fees and expenses, and in no event shall any paper or brief submitted by any such person be accepted or considered by the Court, unless, on or before November 28, 2005, such person (a) files with the Clerk of the Court at the United States Courthouse located at 500 Pearl Street, New York, New York 10007, notice of such person s intention to appear, showing proof of such person s membership in the Class, and providing a statement that indicates the basis for such opposition, along with any documentation in support of such objection; and (b) simultaneously serves copies of such notice, proof, statement and documentation, together with copies of any other papers or briefs such person files with the Court, in person or by mail upon: Steven J. Toll, Esq. Francis J. Menton Andrew N. Friedman, Esq. Jeanne M. Luboja COHEN, MILSTEIN, HAUSFELD WILLKIE FARR & & TOLL, P.L.L.C. GALLAGHER LLP 1100 New York Avenue, N.W. 787 Seventh Avenue West Tower, Suite 500 New York, New York Washington, D.C Telephone: (212) Telephone: (202) Facsimile: (212) Facsimile: (202) Lead Plaintiffs and Class Counsel Settling Defendant s Counsel 13

14 Attendance at the hearing is not necessary; however, persons wishing to be heard orally in opposition to the approval of the proposed Settlement, the proposed Plan of Allocation, and/or the request for attorneys fees are required to indicate in their written objection their intention to appear at the hearing. Persons who intend to object to the proposed Settlement, the proposed Plan of Allocation, and/or counsel s application for an award of attorneys fees and expenses and desire to present evidence at the Final Approval Hearing must include in their written objections the identity of any witnesses they may call to testify and exhibits they intend to introduce into evidence at the Final Approval Hearing. Class Members do not need to appear at the hearing or take any other action to indicate their approval of the proposed Settlement, the proposed Plan of Allocation, or of Plaintiffs Counsel s application for recovery of attorneys fees and expenses. ATTORNEYS FEES AND DISBURSEMENTS 53. At the Final Approval Hearing, or at such other time as the Court may direct, Plaintiffs Counsel intends to apply to the Court for an award of attorneys fees from the Settlement Fund in an amount not greater than one-third (33 1 3%) of the Gross Settlement Fund and for reimbursement of their expenses in the approximate amount of $800,000, plus interest at the same rate as earned by the Settlement Fund. Plaintiffs Counsel, without further notice to the Class, may subsequently apply to the Court for fees and expenses incurred in connection with administering and distributing the Net Settlement proceeds to the members of the Class and any proceedings subsequent to the Final Approval Hearing. FURTHER INFORMATION 54. For a more detailed statement of the matters involved in this Action, reference is made to the pleadings, to the Stipulation, to the Orders entered by the Court and to the other papers filed in the Action, which may be inspected at the Office of the Clerk of the United States District Court for the Southern District of New York, United States Courthouse, 500 Pearl Street, New York, New York 10007, during regular business hours. 55. ALL INQUIRIES BY CLASS MEMBERS CONCERNING THIS SETTLEMENT NOTICE OR THE PROOF OF CLAIM AND RELEASE SHOULD BE MADE TO BERDON CLAIMS ADMINISTRATION AS INDICATED BELOW. SPECIAL NOTICE TO SECURITIES BROKERS AND OTHER NOMINEES 56. If you purchased or otherwise acquired during the period from December 6, 1999, through and including October 27, 2000: (a) GTL common stock or (b) Globalstar/Globalstar Capital %, %, %, or % Senior Notes for the beneficial interest of a person or organization other than yourself, the Court has directed that, WITHIN TEN (10) DAYS OF YOUR RECEIPT OF THIS SETTLEMENT NOTICE, you either: (a) provide to Berdon Claims Administration the name and last known address of each person or organization for whom or which you so acted, preferably in electronic format MS Word or WordPerfect files (label size Avery #5162) or MS Excel data table setting forth (i) title/registration, (ii) street address, (iii) city/state/zip code or on computer-generated mailing labels; or (b) send copies of the Settlement Notice and Proof of Claim ( Notice ) directly to all beneficial owners by first class mail and provide Berdon claims Administration with written confirmation of having done so. Additional copies of the Notice may be requested by contacting: In re Globalstar Securities Litigation c/o Berdon Claims Administration LLC P.O. Box 9014 Jericho, New York Telephone: (800) Facsimile: (516) Website: 14

15 If you previously provided name and address information to Berdon Claims Administration in connection with in this Action, you need only provide Berdon Claims Administration with updated information if changes have occurred. You are entitled to reimbursement from the Settlement Fund of your reasonable expenses actually incurred in connection with the foregoing, including the research of records and the generating of labels or the cost of postage. Those expenses will be paid after submission of a written request and appropriate supporting documentation. All communications concerning the foregoing should be addressed to Berdon Claims Administration. DO NOT CONTACT THE COURT CONCERNING THE SETTLEMENT OR THIS NOTICE Dated: New York, New York September 30, 2005 BY ORDER OF THE COURT 15