Courts Okays Globalstar Initial Bankruptcy Plan

CONSTELLATIONS

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Arbitration Upholds Loral's Termination Of Alcatel Alliance
New York - Feb 25, 2002 - Loral Space & Communications said Monday today that it was notified by an International Chamber of Commerce arbitration panel in Geneva, Switzerland, that the panel has affirmed the validity of Space System/Loral's termination of its agreements with Paris-based Alcatel Space concerning the satellite manufacturing business, effective February 22, 2002.

The agreements between Alcatel and SS/L were terminable on one year's notice and, on February 22, 2001, Loral gave notice to Alcatel that they would expire on February 22, 2002. While Alcatel maintained that the notice was not effective, the panel ruled in Loral's favor on this matter. The agreements are therefore terminated.

The agreements with Alcatel date back to 1991 and have outlived their usefulness due to the evolution of the space industry and the emergence of Alcatel as a direct competitor of Loral's.

In the arbitration, Alcatel's assertion that there were various breaches of the agreements was upheld. Alcatel claimed that certain provisions of the agreements relating to the exchange of information, along with certain procedural or administrative provisions, were violated by Loral. Loral believes that Alcatel's claims for damages are completely without merit. The panel will decide whether those breaches gave rise to damages at a later date.

San Jose - Feb 25, 2002
Globalstar, the global mobile satellite telephone service, today announced that the U.S. Bankruptcy Court in Delaware has approved all of the company's first day motions, allowing Globalstar to continue normal course operations and, with the support of the Company's service providers, further assuring uninterrupted telecommunications service for its customers.

The Court approval, which was granted on February 21, follows Globalstar's filing on February 15 of a voluntary petition under Chapter 11 of the U.S. Bankruptcy Code with the same court.

Globalstar will conduct business as usual with respect to customers, employees and most suppliers. This includes payment of employee salaries and benefits and payment for goods and services provided after February 15, 2002.

As a result, Globalstar will continue its work on finalizing and implementing its new business plan as outlined in last week's announcement, and the company expects to file a complete plan of restructuring with the Court in the coming weeks.

SPACEMART

Globalstar Reports Loss As Bankruptcy Looms

San Jose - Nov. 13, 2001
Globalstar reported continuing losses for the quarter ended September 30, 2001. The company also announced that it is finalizing a new business plan aimed at ensuring uninterrupted service for Globalstar customers as discussions of this plan with its principal creditors continue with the objective of achieving a negotiated financial restructuring in the near future.

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