RELATED ACTIONS

Proceedings Before the Judicial Panel on Multidistrict Litigation

Since April 2002, numerous class actions and individual actions relating to the fraud at WorldCom have been filed in various jurisdictions around the country. On October 8, 2002, the Judicial Panel on Multidistrict Litigation ordered that forty-two class actions arising out of the fraud at WorldCom be centralized in the United States District Court for the Southern District of New York and assigned to The Honorable Denise L. Cote for consolidated or coordinated pretrial proceedings with the WorldCom Securities Litigation or the WorldCom ERISA Litigation, as applicable. See Order. Since that time, numerous WorldCom-related actions -- whether on behalf of a class or individual plaintiffs -- have been and continue to be transferred to the Southern District of New York for consolidation or coordination with the WorldCom Securities Litigation or the WorldCom ERISA Litigation.

WorldCom ERISA Litigation

In an order dated September 18, 2002, Judge Cote consolidated under the caption In re WorldCom, Inc. ERISA Litigation two class actions brought on behalf of participants in the WorldCom 401(k) Salary Savings Plan (the "Plan") pursuant to the Employment Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. 1001, et seq. While the WorldCom ERISA Litigation and the WorldCom Securities Litigation arise out of the same fraud at WorldCom, the legal claims in these two actions are separate and distinct. The WorldCom Securities Litigation is brought on behalf of all persons who purchased or acquired publicly traded securities of WorldCom, including WorldCom stock and publicly traded debt securities during the Class Period and asserts claims pursuant to the federal securities laws. The WorldCom ERISA Litigation is brought on behalf of the Plan's participants -- WorldCom's employees -- and asserts claims for breach of fiduciary duties against the Plan's fiduciaries. On November 18, 2002, Judge Cote appointed Keller Rohrback LLP as Lead Counsel in this litigation. For more information on the WorldCom ERISA Litigation, click here.

Salomon Analyst Litigation

Beginning on May 14, 2002, a number of so-called "analyst cases" relating to the WorldCom debacle were filed in the Southern District of New York. Many of these cases, like the cases filed in connection with the WorldCom Securities Litigation, asserted federal securities law claims on behalf of purchasers of WorldCom securities against Salomon Smith Barney, Inc., Citigroup, Inc., Jack B. Grubman, and other related defendants. Because these analyst cases were not identified as being related to the WorldCom Securities Litigation when filed, they were not initially assigned to Judge Cote -- who is presiding over the WorldCom Securities Litigation -- but to several other judges.

Subsequently, numerous additional Salomon-related cases were filed in the Southern District of New York on behalf of purchasers of securities of Global Crossings, AT&T, Level 3 Communications, Winstar, Metromedia, Rhythms Netconnection, Inc., XO Communications, Inc. and Williams Communications Group, Inc.

These cases were initially grouped together under the caption In re Salomon Analyst Litigation for consolidation or coordination. On January 24, 2003, Judge Barbara S. Jones, who was then presiding over the Salomon Analyst Litigation, sub-divided the Salomon-related cases according to the issuer of securities. As a result, nine separate actions were created, including the Salomon Analyst WorldCom Litigation. See Order. All of these cases were subsequently transferred to Judge Gerard E. Lynch. On March 20, 2003, Judge Lynch appointed the New York State Common Retirement Fund to serve as Lead Plaintiff in the Salomon Analyst WorldCom Litigation. See Order. On April 3, 2003, Judge Lynch appointed Bernstein Litowitz Berger & Grossmann LLP and Barrack Rodos & Bacine as Co-Lead Counsel for the Salomon Analyst WorldCom Litigation. See Order.

On March 24, 2003, Judge Cote denied the motion of Salomon, Citigroup and Grubman to sever certain Grubman-related claims from the WorldCom Securities Litigation and transfer these claims to the Salomon Analyst WorldCom Litigation. See Order. The Court determined that all of the claims asserted on behalf of the purchasers of WorldCom securities against Salomon, Grubman and Citigroup could and should be presented in the WorldCom Securities Litigation, rather than forcing plaintiffs to assert some of the claims in the WorldCom Securities Litigation and others in the Salomon Analyst WorldCom Litigation. Accordingly, the Salomon Analyst WorldCom Litigation has been stayed until further order of the court. See Order.

Bankruptcy Proceedings

On July 21, 2002, WorldCom and its affiliated debtors filed a voluntary petition for relief under Chapter 11, Title 11 of the United States Code, 11 U.S.C. 101-1330. On January 21, 2003, the New York State Common Retirement Fund -- Lead Plaintiff in the WorldCom Securities Litigation -- filed proofs of claim on behalf of the Class in the Bankruptcy Court. The disposition of the claims filed has not yet been adjudicated.

On October 21, 2003, the Bankruptcy Judge entered an Order confirming the Debtors' proposed plan of reorganization, which is available by accessing the Bankruptcy Court's website, http://www.nysb.uscourts.gov, or a separate website, www.elawforworldcom.com. The Bankruptcy Court has further approved a settlement of claims brought by the SEC against WorldCom, in the amount of $750 million ($500 million in cash and $250 million in new Company stock), the allocation of which will be determined separately by the U.S. District Court Judge presiding over the SEC case. You are encouraged to consult with your own counsel should you have any questions concerning the Bankruptcy proceedings.

Individual WorldCom Actions

In addition to numerous class actions commenced as a result of the fraud at WorldCom, a number of plaintiffs have also brought individual actions (the "Individual WorldCom Actions"). Many of the Individual WorldCom Actions were filed in state courts around the country and later removed by defendants to federal court on the ground that they were related to the WorldCom bankruptcy proceedings. As noted above, many of the Individual WorldCom Actions that were removed to federal court were subsequently transferred by the Judicial Panel on Multidistrict Litigation to the Southern District of New York for consolidation or coordination with the WorldCom Securities Litigation. On December 23, 2002, Judge Cote entered an order consolidating for pretrial purposes the Individual WorldCom Actions already before her with the WorldCom Securities Litigation. See Order.

A remand motion was filed by the plaintiffs in New York City Employees' Retirement System v. Bernard J. Ebbers, 02 Civ. 8981 (DLC) -- one of the Individual WorldCom Actions pending before Judge Cote -- seeking to send the case back to state court ("Motion to Remand"). Some of the other plaintiffs in the Individual WorldCom Actions intervened and filed papers with the Court in support of the Motion to Remand, which the defendants in the New York City case opposed. The NYSCRF, which is not a party in the Individual WorldCom actions, took no position on the Motion to Remand. On March 3, 2003, Judge Cote denied the Motion to Remand. See Opinion.

Since the March 3 Opinion, the Court has entered a number of other orders and opinions in certain of the Individual WorldCom Actions, including Opinions and Orders of May 5, May 22, May 28, November 17 and November 21, 2003. See Orders. The Court has also directed that a Court-Ordered Notice To All Investors Who Have Filed Individual WorldCom Actions be sent to all plaintiffs who filed Individual WorldCom Actions, along with the Notice of Class Action that is being disseminated to Class members generally. See Notices.