UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-Q


     /x/ Quarterly report pursuant to Section 13 or 15(d) of the Securities
         Exchange Act of 1934 for the period ended March 31, 2005, or


     / / Transition report pursuant to Section 13 or 15(d) of the
                        Securities Exchange Act of 1934

                        Commission file number 000-13865

                         SKYTERRA COMMUNICATIONS, INC.
             (Exact name of registrant as specified in its charter)

          Delaware                                     23-2368845
(State or other jurisdiction of          (I.R.S. Employer Identification Number)
incorporation or organization)

     19 West 44th Street, Suite 507
        New York, New York                               10036
 (Address of principal executive offices)              (Zip Code)

       Registrant's telephone number, including area code: (212) 730-7540

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter periods that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

                           Yes /x/          No / /

Indicate by check mark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Act).

                           Yes / /          No /x/

Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.

As of May 13, 2005, 8,714,809 shares of the registrant's voting common stock
and 8,990,212 shares of the registrant's non-voting common stock were
outstanding.
<PAGE>


                         SKYTERRA COMMUNICATIONS, INC.
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                       (in thousands, except share data)
                                  (unaudited)
<TABLE>
<CAPTION>

                                                                                           March 31,         December 31,
                                                                                             2005                2004
                                                                                        ----------------    ----------------
                                        Assets
Current assets:
<S>                                                                                             <C>                 <C>
   Cash and cash equivalents                                                                    $58,015             $34,759
   Short-term investments                                                                        32,424              59,748
                                                                                        ----------------    ----------------
     Total cash, cash equivalents and short-term investments                                     90,439              94,507
   Accounts receivable, net                                                                          53                  29
   Prepaid expenses                                                                                 349                 452
   Deferred transaction costs                                                                     7,244               4,989
   Other current assets                                                                             266                 399
                                                                                        ----------------    ----------------
     Total current assets                                                                        98,351             100,376

Property and equipment, net                                                                         526                 605
Investment in Mobile Satellite Ventures LP                                                       46,375              50,098
Investments in affiliates                                                                         2,280               3,361
Other assets                                                                                        126                 130
                                                                                        ----------------    ----------------
       Total assets                                                                            $147,658            $154,570
                                                                                        ================    ================

                          Liabilities and Stockholders' Equity
Current liabilities:
   Accounts payable                                                                              $1,992              $2,210
   Accrued liabilities                                                                            9,665               8,281
   Deferred revenue                                                                                   -                  21
                                                                                        ----------------    ----------------
     Total current liabilities                                                                   11,657              10,512
                                                                                        ----------------    ----------------
Series A Convertible Preferred Stock, $.01 par value, net of unamortized
  discount of $31,490 and $32,589, respectively                                                  89,805              88,706
                                                                                        ----------------    ----------------
Minority interest                                                                                 9,229               9,974
                                                                                        ----------------    ----------------
Stockholders' equity:
   Preferred stock, $.01 par value. Authorized 10,000,000 shares; issued
     1,199,007 shares as Series A Convertible Preferred Stock at March 31,
     2005 and December 31, 2004                                                                       -                   -
   Common stock, $.01 par value.  Authorized 200,000,000 shares; issued and
     outstanding 8,414,809 shares at March 31, 2005 and 8,384,809 shares at
     December 31, 2004                                                                               84                  84
   Non-voting common stock, $.01 par value.  Authorized 100,000,000 shares;
     issued and outstanding 8,990,212 shares at each of March 31, 2005 and
     December 31, 2004                                                                               90                  90
   Additional paid-in capital                                                                   585,345             584,798
   Accumulated other comprehensive income (loss)                                                     14                  (3)
   Accumulated deficit                                                                         (548,566)           (539,591)
                                                                                        ----------------    ----------------
       Total stockholders' equity                                                                36,967              45,378
                                                                                        ----------------    ----------------
       Total liabilities and stockholders' equity                                              $147,658            $154,570
                                                                                        ================    ================


     See accompanying notes to condensed consolidated financial statements.

</TABLE>
<PAGE>

                         SKYTERRA COMMUNICATIONS, INC.
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                       (in thousands, except share data)
                                  (unaudited)
<TABLE>
<CAPTION>

                                                                                 Three Months Ended March 31,
                                                                                 ------------------------------
                                                                                     2005             2004
                                                                                 -------------    -------------
<S>                                                                                      <C>              <C>
Revenues                                                                                 $197             $817
Costs of revenues                                                                         199              748
                                                                                 -------------    -------------
  Gross margin                                                                             (2)              69
Expenses:
   Selling, general and administrative                                                  2,574            1,764
   Depreciation and amortization                                                           55               15
                                                                                 -------------    -------------
     Total expenses                                                                     2,629            1,779
                                                                                 -------------    -------------
Loss from operations                                                                   (2,631)          (1,710)
Interest income, net                                                                      541            2,161
Equity in loss of Mobile Satellite Ventures LP                                         (3,723)               -
Loss on investments in affiliates                                                      (1,456)            (151)
Other income, net                                                                          41               36
Minority interest                                                                         746             (300)
                                                                                 -------------    -------------
Net (loss) income                                                                      (6,482)              36
Cumulative dividends and accretion of convertible preferred stock to
  liquidation value                                                                    (2,493)          (2,461)
                                                                                 -------------    -------------
Net loss attributable to common stockholders                                          $(8,975)         $(2,425)
                                                                                 =============    =============
Basic and diluted loss per share                                                       $(0.52)          $(0.16)
                                                                                 =============    =============
Basic weighted average common shares outstanding                                   17,401,685       15,063,807
                                                                                 =============    =============


     See accompanying notes to condensed consolidated financial statements.
</TABLE>

<PAGE>

                         SKYTERRA COMMUNICATIONS, INC.
                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (in thousands)
                                  (unaudited)
<TABLE>
<CAPTION>

                                                                                      Three Months Ended March 31,
                                                                                     -------------------------------
                                                                                         2005              2004
                                                                                     -------------     -------------
<S>                                                                                       <C>                <C>
Cash flows from operating activities:
   Net (loss) income                                                                     $(6,482)              $36
   Adjustments to reconcile net loss to net cash used in operating activities:
     Depreciation and amortization                                                            55                15
     Equity in loss of Mobile Satellite Ventures LP                                        3,723                 -
     Loss on investments in affiliates                                                     1,456               151
     Minority interest                                                                      (746)              300
     Gain on sale of property and equipment                                                  (49)                -
     Non-cash compensation expense                                                           699               263
     Non-cash charge for issuance of warrants by consolidated subsidiary                      53                 -
     Changes in assets and liabilities:
       Accounts receivable, net                                                              (24)              (68)
       Prepaid expenses, deferred transaction costs and other assets                      (2,019)           (2,451)
       Accounts payable, accrued and other liabilities                                       885              (324)
       Deferred revenue                                                                      (21)              (86)
                                                                                     -------------     -------------
           Net cash used in operating activities                                          (2,470)           (2,164)
                                                                                     -------------     -------------
Cash flows from investing activities:
   Sales of short-term investments                                                        39,404             5,150
   Purchases of short-term investments                                                   (12,080)           (6,581)
   Cash paid for investments in affiliates                                                  (375)             (334)
   Sales of property and equipment                                                            74                 -
   Purchases of property and equipment                                                        (9)               (3)
                                                                                     -------------     -------------
           Net cash provided by (used in) investing activities                            27,014            (1,768)
                                                                                     -------------     -------------
Cash flows from financing activities:
   Payment of dividend on preferred stock                                                 (1,394)                -
   Proceeds from issuance of common stock in connection with the exercise
     of options                                                                               77                 6
                                                                                     -------------     -------------
           Net cash (used in) provided by financing activities                            (1,317)                6
Effect of exchange rate changes on cash and cash equivalents                                  29                 -
                                                                                     -------------     -------------
Net increase (decrease) in cash and cash equivalents                                      23,256            (3,926)
Cash and cash equivalents, beginning of period                                            34,759             6,897
                                                                                     -------------     -------------
Cash and cash equivalents, end of period                                                 $58,015            $2,971
                                                                                     =============     =============


     See accompanying notes to condensed consolidated financial statements.
</TABLE>
<PAGE>




                         SKYTERRA COMMUNICATIONS, INC.
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                  (unaudited)

(1)  Description of the Business

     SkyTerra Communications, Inc. (the "Company") operates its business
through a group of complementary companies in the telecommunications industry.
These companies include: (i) the Mobile Satellite Venture, L.P. joint venture
("MSV Joint Venture"), a joint venture which provides mobile digital voice and
data communications services via satellite; (ii) Electronic System Products,
Inc. ("ESP"), a product development and engineering services firm and (iii)
AfriHUB, LLC ("AfriHUB"), an early stage company that provides a limited amount
of satellite based Internet access and domestic and international calling
services through exclusive partnerships with certain Nigerian based
universities while it actively pursues opportunities to provide technical
training in the Nigerian market. Further, in April 2005, the Company completed
its acquisition of 50% of the equity interests of Hughes Network Systems, LLC
("HNS"), a leading provider of broadband satellite networks and services to the
enterprise market and satellite Internet access to the North American consumer
market. Following the acquisition, the Company serves as the managing member of
HNS.

     The Company is headquartered in New York, New York.

 (2) Basis of Presentation

     The accompanying condensed consolidated financial statements have been
prepared by the Company in accordance with generally accepted accounting
principles for interim financial information and with the instructions to Form
10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do not include all of
the information and footnotes required by generally accepted accounting
principles for complete financial statements. In the opinion of management, the
accompanying condensed consolidated financial statements contain all
adjustments, consisting only of those of a normal recurring nature, necessary
for a fair presentation of the Company's financial position, results of
operations and cash flows at the dates and for the periods indicated. While the
Company believes that disclosures presented are adequate to make the
information not misleading, these condensed consolidated financial statements
should be read in conjunction with the audited financial statements and related
notes for the year ended December 31, 2004 which are contained in the Company's
Annual Report on Form 10-K filed with the Securities and Exchange Commission.
The results of the three months ended March 31, 2005 are not necessarily
indicative of the results to be expected for the full year. Certain prior year
amounts in the accompanying condensed consolidated financial statements have
been reclassified to conform to the current year's presentation.

(3)  Interest in the MSV Joint Venture

     The Company's 80% owned MSV Investors, LLC subsidiary (the "MSV Investors
Subsidiary") owns approximately 23% of the limited partnership interests (on an
undiluted basis) of the MSV Joint Venture, a joint venture that also includes
TMI Communications, Inc. ("TMI"), Motient Corporation ("Motient") and certain
other investors (the "Other MSV Investors"). The Company accounts for its
interest in the MSV Joint Venture under the equity method and, accordingly,
records its proportionate share of the net income (loss) of the MSV Joint
Venture, subject to certain adjustments. These adjustments relate primarily to
the amortization of the excess of the Company's carrying amount over its
proportionate share of the MSV Joint Venture's net assets on the date of
conversion. This excess is being amortized over the remaining useful life of
certain MSV Joint Venture long-lived assets on a straight line basis. As of
March 31, 2005, the Company's book investment exceeded its proportionate share
of the MSV Joint Venture's net assets by approximately $1.5 million.

     The following table presents summarized consolidated financial information
for the MSV Joint Venture for the periods indicated:

<TABLE>
<CAPTION>

                                                                                 March 31, 2005     December 31, 2004
                                                                                 ---------------    ------------------
                                                                                            (in thousands)
Consolidated balance sheet information:
<S>                                                                                    <C>                   <C>
     Current assets                                                                    $129,476              $139,978
     Noncurrent assets                                                                  102,246               106,245
     Current liabilities                                                                 11,899                11,772
     Noncurrent liabilities                                                              22,570                21,386
     Minority interest                                                                      237                   101
     Partners' equity                                                                   197,016               212,964

                                                                                  Three Months
                                                                                     Ended
                                                                                 March 31, 2005
                                                                                 ---------------
                                                                                 (in thousands)
Consolidated statement of operations:
     Revenues                                                                            $7,190
     Loss from operations                                                               (17,565)
     Net loss                                                                           (16,186)
</TABLE>

     The MSV Investors Subsidiary and the other partners of the MSV Joint
Venture have agreed that the acquisition or disposition by the MSV Joint
Venture of its assets, certain acquisitions or dispositions of a limited
partner's interest in the MSV Joint Venture, subsequent investment into the MSV
Joint Venture by any person, and any merger or other business combination of
the MSV Joint Venture, are subject to the control restrictions contained in the
Amended and Restated Limited Partnership Agreement, the Amended and Restated
Stockholders Agreement and the Voting Agreement. The control restrictions
include, but are not limited to, rights of first refusal, tag along rights and
drag along rights. Many of these actions, among others, cannot occur without
the consent of the majority of the ownership interests of the MSV Joint
Venture. In addition, pursuant to the Voting Agreement, the MSV Investors
Subsidiary and two of the three other joint venture partner groups have agreed
that three of the four joint venture partner groups must consent to certain
transactions involving the MSV Joint Venture or the partners or none of the
parties to the Voting Agreement will support such actions, including permitting
any partner to acquire control of the MSV Joint Venture.

     In December 2004, the MSV Joint Venture issued rights (the "TerreStar
Rights") to receive all of the shares of common stock of TerreStar Networks
Inc. ("TerreStar"), then a wholly-owned subsidiary of the MSV Joint Venture, to
the limited partners of the MSV Joint Venture, pro rata in accordance with each
limited partner's percentage ownership. TerreStar was formed by the MSV Joint
Venture to develop business opportunities related to the proposed receipt of
certain licenses in the 2 GHz band. The TerreStar Rights were to automatically
be exchanged for shares of TerreStar common stock on May 20, 2005. In
connection with the distribution of the TerreStar Rights, TerreStar issued
warrants to purchase shares of its common stock representing 3% of the
outstanding equity for an exercised price of $0.21 per share to certain of the
Other MSV Investors. These warrants were exercised in March 2005. On May 11,
2005, TerreStar raised $200.0 million in cash by selling common stock to
Motient at a purchase price of $24.42 per share (the "TerreStar Private
Placement"), raising Motient's ownership of TerreStar to approximately 61% on
an undiluted basis. In connection with the TerreStar Private Placement, the
TerreStar Rights were exchanged for shares of TerreStar common stock. Following
these transactions, the Company's MSV Investors Subsidiary owns 5,303,315
shares of TerreStar common stock, or approximately 17% of TerreStar on an
undiluted basis, and will account for its interest in TerreStar under the cost
method.

     In connection with the TerreStar Private Placement, the minority
shareholders of TerreStar, including the Company's MSV Investors Subsidiary,
TMI and the Other MSV Investors, entered into certain agreements with TerreStar
and Motient providing the MSV Investors Subsidiary (and the other minority
shareholders) with certain protections, including tag along rights, pre-emptive
rights and representation on the TerreStar Board of Directors. In addition, the
TerreStar shares held by the minority shareholders, including the MSV Investors
Subsidiary, under certain conditions, may be subject to drag along rights of
Motient. In connection with the TerreStar Private Placement, the MSV Joint
Venture licensed TerreStar certain intellectual property and agreed to provide
TerreStar with certain services. Also, in connection with the transaction,
Motient agreed, subject to satisfaction of certain conditions, to waive certain
rights in order to facilitate a transaction in which the one of the minority
shareholders in TerreStar acquires all of the interests in the MSV Joint
Venture held by the other minority shareholders in TerreStar, resulting in
control of the MSV Joint Venture being held by such party. The minority
shareholders have not agreed to such a transaction or committed to consummate
such a transaction. There can be no assurance that any such discussions will
take place among the minority shareholders or otherwise result in a definitive
binding agreement.

(4)  Business Transactions

     (a)  Interest in Hughes Network Systems

     In April 2005, the Company completed its acquisition of 50% of the equity
interests of HNS from Hughes Network Systems, Inc. ("HNSI"), a wholly owned
subsidiary of The DIRECTV Group, Inc. ("DIRECTV"), for $50.0 million in cash
and 300,000 shares of the Company's common stock. The acquisition occurred
pursuant to an agreement among the Company, DIRECTV, HNSI and HNS, dated
December 3, 2004, as amended. Immediately prior to the acquisition, HNSI
contributed substantially all of the assets and certain liabilities of its very
small aperture terminal, mobile satellite and carrier businesses, as well as
the certain portions of its SPACEWAY Ka-band satellite communications platform
that is under development, to HNS, which at the time was a wholly-owned
subsidiary of HNSI. In consideration for the contribution of assets by HNSI,
HNS paid HNSI $190.7 million of cash. This payment represents the $201.0
million stated in the agreement less an estimated purchase price adjustment of
$10.3 million, which is subject to further adjustment depending principally
upon the closing value of HNS' working capital (as defined in the agreement).
Concurrently, HNS incurred $325.0 million of term indebtedness and obtained a
$50.0 million revolving credit facility. The Company and HNSI have each granted
a security interest in their respective equity interest in HNS to secure the
obligations of HNS under the term indebtedness. Following the acquisition, the
Company serves as the managing member of HNS. The Company will account for its
interest in HNS under the equity method in accordance with Financial Accounting
Standards Board Interpretation No. 46R, "Consolidation of Variable Interest
Entities, an Interpretation of ARB No. 51" ("FIN 46R"), as HNS is a variable
interest entity as defined in FIN 46R and the Company is not the primary
beneficiary as defined in FIN 46R.

     As of March 31, 2005 and December 31, 2004, the Company had incurred
approximately $7.2 million and $5.0 million, respectively, of transaction
costs, including legal, accounting and other costs directly related to the
transaction. These costs are included in deferred transaction costs on the
accompanying condensed consolidated balance sheets. At closing of the
acquisition, HNS paid $6.6 million of these costs directly and reimbursed the
Company for the remaining $0.6 million.

     (b) Interest in Navigauge

     As of March 31, 2005, the Company owned approximately 39% of the
outstanding equity interests of Navigauge, Inc. ("Navigauge") on an undiluted
basis. Navigauge is a privately held media and marketing research firm that
collects data on in-car radio usage and driving habits of consumers and intends
to market the aggregate data to radio broadcasters, advertisers and advertising
agencies in the United States. From January 2005 through March 2005, the
Company purchased additional short-term promissory notes from Navigauge with an
aggregate principal amount of approximately $0.4 million. As of March 31, 2005,
the Company holds short-term promissory notes from Navigauge with an aggregate
principal amount of approximately $0.9 million and, following the impairment
discussed below, no carrying amount on the accompanying condensed consolidated
balance sheets.

     Although Navigauge is a variable interest entity as defined in FIN 46R,
the Company is not the primary beneficiary as defined in FIN 46R. Accordingly,
prior to the impairment discussed below, this investment was included in
investments in affiliates on the accompanying condensed consolidated balance
sheets and was being accounted for under the equity method with the Company's
share of Navigauge's loss being recorded in loss on investments in affiliates
on the accompanying condensed consolidated statements of operations. For the
three months ended March 31, 2005 and 2004, the Company's share of Navigauge's
loss was $0.3 million and $0.2 million, respectively.

     As Navigauge has been unsuccessful in raising the capital necessary to
expand its service beyond the Atlanta market and in light of its prospects, as
of March 31, 2005, the Company recognized a loss of $1.2 million relating to
the impairment of the aggregate remaining carrying amount of its equity
interest in Navigauge and the short-term promissory notes. This loss is
included in loss on investments in affiliates on the accompanying condensed
consolidated statements of operations.

     (c) Interest in Miraxis

     As of March 31, 2005, the Company owned approximately 40% of the ownership
interests of Miraxis on an undiluted basis. Miraxis is a development stage
company that has access to a Ka-band license so long as it implements its
business plan to provide satellite based multi-channel, broadband data and
video services in North America. The Company's President and Chief Executive
Officer holds an approximate 1% interest in Miraxis. As Miraxis is a variable
interest entity as defined in FIN 46R and the Company is the primary
beneficiary as defined in FIN 46R, the operating results and financial position
of Miraxis have been included in the condensed consolidated financial
statements.

 (5) Stock Option Plans

     The Company accounts for its stock option plan in accordance with SFAS No.
123, "Accounting for Stock-Based Compensation" ("SFAS No. 123"), which allows
entities to continue to apply the provisions of APB Opinion No. 25, "Accounting
for Stock Issued to Employees" ("APB Opinion No. 25"), as clarified by FASB
Interpretation No. 44, "Accounting For Certain Transactions Involving Stock
Compensation," and provides pro forma net income and pro forma earnings per
share disclosures for employee stock option grants as if the fair-value-based
method, as defined in SFAS No. 123, had been applied. The Company has elected
to apply the provisions of APB Opinion No. 25 and provide the pro forma
disclosure required by SFAS No. 123.

     APB Opinion No. 25 does not require the recognition of compensation
expense for stock options granted to employees at fair market value. However,
any modification to previously granted awards generally results in compensation
expense or contra-expense recognition using the cumulative expense method,
calculated based on quoted prices of the Company's common stock and vesting
schedules of underlying awards. As a result of the re-pricing of certain stock
options, for the three months ended March 31, 2005 and 2004, the Company
recognized compensation expense of approximately $0.4 million and $0.3 million,
respectively.

     The following table provides a reconciliation of net loss to pro forma net
loss as if the fair value method had been applied to all awards:

<TABLE>
<CAPTION>

                                                                               Three Months Ended March 31,
                                                                              --------------------------------
                                                                                   2005              2004
                                                                              ---------------    -------------
<S>                                                                                 <C>                  <C>
Net (loss) income, as reported                                                      $(6,482)             $36
Add:  Stock-based compensation expense, as reported                                     699              263
Deduct:  Total stock-based compensation expense determined under fair value
   based method for all awards                                                         (494)             (65)
                                                                              ---------------    -------------
Pro forma net (loss) income                                                         $(6,277)            $234
                                                                              ===============    =============
Basic and diluted net loss attributable to common stockholders per share:
   As reported                                                                       $(0.52)          $(0.16)
   Pro forma                                                                         $(0.50)          $(0.15)
</TABLE>

     For the three months ended March 31, 2005, the Company issued options to
purchase 80,000 shares of common stock at a weighted average fair value of
$17.77 using the Black-Scholes option pricing model. For the three months ended
March 31, 2004, the Company issued options to purchase 145,000 shares of common
stock at a weighted average fair value of $1.77 using the Black-Scholes option
pricing model.

(6)    Segment Information

     The segment information is reported along the same lines that our chief
operating decision maker reviews the operating results in assessing performance
and allocating resources. Accordingly, the Company's consolidated operations
have been classified into four reportable segments: the MSV Joint Venture, ESP,
AfriHUB and Parent and other. The MSV Joint Venture, which became a reportable
segment following the November 2004 conversion of the notes receivable into
limited partnership interests of the MSV Joint Venture, provides mobile digital
voice and data communications services via satellite. ESP, which became a
reportable segment following the August 2003 acquisition by the Company, is an
engineering services firm with expertise in the design and manufacturing of
electronic products and systems across many disciplines of electrical
engineering. AfriHUB, which became a reportable segment following the April
2004 acquisition by the Company, provides a limited amount of satellite based
Internet access and domestic and international calling services through
exclusive partnerships with certain Nigerian based universities while it
explores opportunities to provide technical training in the Nigerian market.
Parent and other includes the Company, other consolidated entities other than
ESP and AfriHUB and eliminations.

     The following table presents certain financial information on the
Company's reportable segments as of or for the three months ended March 31,
2005. Since our 23% share of the results MSV Joint Venture's operations is
already included in the Parent and Other column, the MSV Joint Venture
Elimination column removes the results of the MSV Joint Venture shown in the
MSV Joint Venture column.

<TABLE>
<CAPTION>

                                                                                                  Eliminate
                                      MSV Joint                                    Parent         MSV Joint
                                       Venture          ESP          AfriHUB       and Other       Venture       Consolidated
                                     ------------    -----------    -----------    -----------    -----------    -------------
                                                                          (in thousands)
<S>                                       <C>              <C>             <C>             <C>      <C>                <C>
Revenues                                  $7,190           $135            $62             $-       $(7,190)           $197
Operating expenses                       (24,755)          (256)          (537)        (2,035)       24,755          (2,828)
                                     ------------    -----------    -----------    -----------    -----------    -------------
Loss from operations                     (17,565)          (121)          (475)        (2,035)       17,565          (2,631)
Interest income (expense), net               635            (15)           (14)           570          (635)            541
Equity in loss of Mobile Satellite
  Ventures LP                                  -              -              -         (3,723)            -          (3,723)
Loss on investments in affiliates              -              -              -         (1,456)            -          (1,456)
Other income (expense), net                  738             52            (26)            15          (738)             41
Minority interest                              6              -              -            746            (6)            746
                                     ------------    -----------    -----------    -----------    -----------    -------------
Net (loss) income                       $(16,186)          $(84)         $(515)       $(5,883)      $16,186         $(6,482)
                                     ============    ===========    ===========    ===========    ===========    =============
Total assets                            $231,722           $124           $631       $146,903     $(231,722)       $147,658
                                     ============    ===========    ===========    ===========    ===========    =============
</TABLE>

     The following table presents certain financial information on the
Company's reportable segments as of or for the three months ended March 31,
2004:

<TABLE>
<CAPTION>

                                                           ESP         Parent         Consolidated
                                                                       and Other
                                                        -----------    -----------    -------------
                                                                      (in thousands)
<S>                                                          <C>              <C>            <C>
Revenues                                                     $817             $-             $817
Operating expenses                                         (1,076)        (1,451)          (2,527)
                                                        -----------    -----------    -------------
Loss from operations                                         (259)        (1,451)          (1,710)
Interest (expense) income, net                                (17)         2,178            2,161
Loss on investments in affiliates                             (75)           (76)            (151)
Other income, net                                              19             17               36
Minority interest                                               -           (300)            (300)
                                                        -----------    -----------    -------------
Net (loss) income                                           $(332)          $368              $36
                                                        ===========    ===========    =============
Total assets                                                 $582        $97,712          $98,294
                                                        ===========    ===========    =============
</TABLE>

     As of March 31, 2005 and December 31, 2004, all of the Company's
long-lived assets were located in the United States, excluding $0.5 million
located in Nigeria.

(7)  Discontinued Operations

     From 1998 through the third quarter of 2001, the Company's principal
business was conducted through Rare Medium, Inc., which developed Internet
e-commerce strategies, business processes, marketing communications, branding
strategies and interactive content using Internet-based technologies and
solutions. As a result of the weakening of general economic conditions that
caused many companies to reduce spending on Internet-focused business solutions
and in light of their performance and prospects, a decision to discontinue Rare
Medium, Inc.'s operations, along with those of its LiveMarket, Inc. subsidiary
("LiveMarket"), was made at the end of the third quarter of 2001. As of March
31, 2005, cash of approximately $14,000 (excluding the $0.3 million of cash
collateralizing a letter of credit) was the remaining asset of Rare Medium,
Inc. and LiveMarket. The liabilities of these subsidiaries totaled
approximately $2.3 million, consisting of accounts payable and accrued
expenses. Included in the total liabilities of these subsidiaries is $1.0
million related to a lease obligation which is guaranteed by the Company. The
total maximum potential liability of this guarantee is approximately $3.7
million, subject to certain defenses by the Company. Rare Medium, Inc. holds
$0.3 million of cash in a certificate of deposit which is maintained as
collateral for a letter of credit supporting the lease obligation. For the
three months ended March 31, 2005 and 2004, the Company did not recognized any
gains or losses as a result of the settlement of Rare Medium, Inc. liabilities
at amounts less than or greater than their recorded amounts.

 (8) Related Party Transactions

     During the three months ended March 31, 2005 and 2004, ESP recognized
revenues totaling approximately $11,000 and $0.4 million, respectively, for
certain services provided to Navigauge and the MSV Joint Venture.

(9)  Contingencies

   Litigation

     On November 19, 2001, five of the Company's former shareholders filed a
complaint against the Company, certain of its subsidiaries and certain of the
then current and former officers and directors in the United States District
Court for the Southern District of New York, Dovitz v. Rare Medium Group, Inc.
et al., No. 01 Civ. 10196. Plaintiffs became owners of restricted Company stock
when they sold the company that they owned to the Company. Plaintiffs assert
the following four claims against defendants: (1) common-law fraud; (2)
violation of Section 10(b) of the Securities Exchange Act of 1934 and Rule
10b-5 promulgated thereunder; (3) violation of the Michigan Securities Act; and
(4) breach of fiduciary duty. These claims arise out of alleged representations
by defendants to induce plaintiffs to enter into the transaction. The complaint
sought compensatory damages of approximately $5.6 million, exemplary and/or
punitive damages in the same amount, as well as attorney fees. On January 25,
2002, the Company filed a motion to dismiss the complaint in its entirety. On
June 3, 2002, the Court dismissed the matter without prejudice. On or about
July 17, 2002, the plaintiffs filed an amended complaint asserting similar
causes of action to those asserted in the original complaint. On September 12,
2002, the Company filed a motion to dismiss the amended complaint. On March 7,
2003, the Court denied the motion to dismiss, and discovery commenced.
Following the completion of discovery, the Company filed a motion for summary
judgment on July 30, 2004. Plaintiffs opposed the motion (the "Plaintiffs'
Opposition"), and the Company responded.

     On September 14, 2004 and again on November 1, 2004, the Company notified
the plaintiffs that, upon a final adjudication of the matter, it intended to
seek sanctions pursuant to Rule 11 of the Federal Rules of Civil Procedure,
based upon what were believed to be numerous falsehoods contained in the
plaintiffs' complaint and various other filings in the case, including the
Plaintiffs' Opposition. In response, on November 12, 2004, the plaintiffs
withdrew certain of the assertions contained in Plaintiffs' Opposition. The
Company then filed the motion for sanctions (the "Sanctions Motion") against
the plaintiffs seeking attorney's fees and expenses incurred in connection with
the action. The plaintiffs opposed the sanctions motion on December 17, 2004
and the Company replied. On January 13, 2005, the case was dismissed by the
Court with prejudice, subject to reinstatement by either party within 30 days
of the order, in light of an agreement in principle to resolve the matter. On
February 11, 2005, the parties executed a settlement agreement pursuant to
which all parties denied liability relating to all matters, including but not
limited to the original complaint and the Sanctions Motion, exchanged mutual
releases, and the Company agreed to transfer to the plaintiffs an indirect
nominal interest in a former subsidiary of the Company. The Company did not
recognize a charge in connection with this settlement as the interest in the
former subsidiary had no carrying value on the accompanying condensed
consolidated balance sheets.

     The Company and certain of its subsidiaries (along with the Engelhard
Corporation) are parties to an arbitration relating to certain agreements that
existed between or among the claimant and ICC Technologies, Inc., the Company's
former name, and the Engelhard/ICC ("E/ICC") joint venture arising from the
desiccant air conditioning business that the Company and its subsidiaries sold
in 1998. The claimant has sought $8.5 million for (1) its alleged out of pocket
losses in investing in certain of E/ICC's technology; (2) unjust enrichment
resulting from the reorganization of E/ICC in 1998; and (3) lost profits
arising from the fact that it was allegedly forced to leave the air
conditioning business when the E/ICC joint venture was dissolved. The Company
intends to vigorously dispute this action.

     In August 2003, a former employee of the Company's discontinued services
subsidiary, filed a putative class action against Rare Medium, Inc. and the
Company, and certain other former subsidiaries that were merged into Rare
Medium, Inc., in Los Angeles County Superior Court captioned Joe Robuck,
individually and on behalf of all similarly situated individuals v. Rare Medium
Group, Inc., Rare Medium L.A., Inc., Rare Medium, Inc., and Rare Medium Dallas,
Inc., Los Angeles County Superior Court Case No. BC300310. The plaintiff filed
the action as a putative class action and putative representative action
asserting that: (i) certain payments were purportedly due and went unpaid for
overtime for employees with five job titles; (ii) certain related violations of
California's overtime statute were committed when these employees were not paid
such allegedly due and unpaid overtime at the time of their termination; and
(iii) certain related alleged violations of California's unfair competition
statute were committed. Plaintiff seeks to recover for himself and all of the
putative class, alleged unpaid overtime, waiting time penalties (which can be
up to 30 days' pay for each person not paid all wages due at the time of
termination), interest, attorneys' fees, costs and disgorgement of profits
garnered as a result of the alleged failure to pay overtime. The plaintiff has
served discovery requests and all of the defendants have submitted objections
and do not intend to provide substantive responses until the Court determines
whether the plaintiff must arbitrate his individual claims. In February 2005,
the Company and Rare Medium, Inc. reached an agreement in principle with the
plaintiff pursuant to which the class action will be dismissed without
prejudice. As part of the agreement, the Company and Rare Medium, Inc. will
receive releases from certain individuals and the certain individuals will each
receive an immaterial settlement payment. Should the settlement agreement not
be finalized, the Company and Rare Medium, Inc. intend to vigorously dispute
this action.

     Though it intends to continue to vigorously contest each of the
aforementioned cases to the extent not settled, the Company is unable to
predict their respective outcomes, or reasonably estimate a range of possible
losses, if any, given the current status of these cases. Additionally, from
time to time, the Company is subject to litigation in the normal course of
business. The Company is of the opinion that, based on information presently
available, the resolution of any such additional legal matters will not have a
material adverse effect on the Company's financial position or results of its
operations.

(10)   Subsequent Events

     On April 22, 2005, the Company completed its acquisition of 50% of the
equity interests of HNS from HNSI, a wholly owned subsidiary of DIRECTV, for
$50.0 million in cash and 300,000 shares of the Company's common stock. The
acquisition occurred pursuant to an agreement among the Company, DIRECTV, HNSI
and HNS, dated December 3, 2004, as amended. Immediately prior to the
acquisition, HNSI contributed substantially all of the assets and certain
liabilities of its very small aperture terminal, mobile satellite and carrier
businesses, as well as the certain portions of its SPACEWAY Ka-band satellite
communications platform that is under development, to HNS, which at the time
was a wholly-owned subsidiary of HNSI. In consideration for the contribution of
assets by HNSI, HNS paid HNSI $190.7 million of cash. This payment represents
the $201.0 million stated in the agreement less an estimated purchase price
adjustment of $10.3 million, which is subject to further adjustment depending
principally upon the closing value of HNS' working capital (as defined in the
agreement). Concurrently, HNS incurred $325.0 million of term indebtedness and
obtained a $50.0 million revolving credit facility. The Company and HNSI have
each granted a security interest in their respective equity interest in HNS to
secure the obligations of HNS under the term indebtedness. Following the
acquisition, the Company serves as the managing member of HNS. The Company will
account for its interest in HNS under the equity method in accordance with FIN
46R, as HNS is a variable interest entity as defined in FIN 46R and the Company
is not the primary beneficiary, as defined in FIN 46R.

     On May 11, 2005, TerreStar raised $200.0 million in cash by selling common
stock to Motient at a purchase price of $24.42 per share (the "TerreStar
Private Placement"), raising Motient's ownership of TerreStar to approximately
61% on an undiluted basis (see Note 3). In connection with the TerreStar
Private Placement, the TerreStar Rights were exchanged for shares of TerreStar
common stock. Following these transactions, the Company's MSV Investors
Subsidiary owns 5,303,315 shares of TerreStar common stock, or approximately
17% of TerreStar on an undiluted basis, and will account for its interest in
TerreStar under the cost method.

Item 2. Management's Discussion and Analysis of Financial Condition and
        Results of Operations

     This report contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934 that involve risks and uncertainties, including statements
regarding our capital needs, business strategy, expectations and intentions. We
urge you to consider that statements that use the terms "believe," "do not
believe," "anticipate," "expect," "plan," "estimate," "intend" and similar
expressions are intended to identify forward-looking statements. These
statements reflect our current views with respect to future events and because
our business is subject to numerous risks, uncertainties and risk factors, our
actual results could differ materially from those anticipated in the
forward-looking statements, including those set forth below under this "Item 2.
Management's Discussion and Analysis of Financial Condition and Results of
Operations" and elsewhere in this report. Actual results will most likely
differ from those reflected in these statements, and the differences could be
substantial. We disclaim any obligation to publicly update these statements, or
disclose any difference between our actual results and those reflected in these
statements. The information constitutes forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995.

Overview

     We operate our business through a group of complementary companies in the
telecommunications industry, including the MSV Joint Venture, ESP and AfriHUB.
Consistent with this approach, in April 2005, we acquired a 50% interest in
HNS, a leading provider of broadband satellite networks and services to the
enterprise market and satellite Internet access to the North American consumer
market. Furthermore, we are currently engaged in a number of other separate and
unrelated preliminary discussions concerning possible joint ventures and other
transactions. We are in the early stages of such discussions and have not
entered into any definitive agreements with respect to any material
transaction, other than what has been described in this Form 10-Q. Prior to
consummating any transaction, we will have to, among other things, initiate and
satisfactorily complete a due diligence investigation, negotiate the financial
and other terms (including price) and conditions of such transaction, obtain
appropriate board of directors', regulatory and other necessary consents and
approvals and secure financing, to the extent deemed necessary.

     In November 2004, the FCC granted the MSV Joint Venture's application to
operate an ancillary terrestrial component ("ATC") in the L-Band, subject to
certain conditions. This authorization was the first license for ATC operation
granted by the FCC, allowing the MSV Joint Venture to offer an ATC with its
commercial service. In February 2005, the FCC issued an order (the "February
2005 Order") which set forth new rules for the deployment and operation of an
ATC and provided the MSV Joint Venture with substantial additional flexibility
in its system implementation. Furthermore, the February 2005 Order allows the
MSV Joint Venture to significantly lower the cost of deploying an ATC and
increases the capacity of the MSS/ATC hybrid system. This additional
flexibility provided by the FCC's decision is expected to allow the MSV Joint
Venture to offer users affordable and reliable voice and high-speed data
communications service from virtually anywhere on the North American continent.

     As a result of the FCC's authorizations, the value of our stake in the MSV
Joint Venture has significantly increased; however, even with ATC authority,
the ability of the MSV Joint Venture to succeed is subject to significant risks
and uncertainties, including the ability of the MSV Joint Venture to raise the
capital necessary for the implementation of the next generation satellite
system including ATC or to identify and reach an agreement with one or more
strategic partners. Additional risks include the ability of the MSV Joint
Venture to attract and retain customers, the increased potential competition
from other satellite and wireless service providers, as well as the uncertainty
with respect to the outcome of the court challenges to the FCC's ATC orders.

     During 2004, our consolidated revenues were primarily derived from fees
generated from services performed by ESP. During the fourth quarter of 2004,
ESP experienced a significant decline in demand for its services, including
from its existing customers. As a result, in January 2005, ESP reduced its
workforce from 21 employees to four employees to compensate for the reduced
cash inflows. ESP is still performing services for a limited number of clients,
including the MSV Joint Venture and Navigauge; however, it is no longer seeking
new client engagements and is instead focusing on exploiting its intellectual
property portfolio.

     In April 2004, we acquired a controlling interest in AfriHUB. AfriHUB's
plan was to provide instructor led and distance based technical training and
satellite based broadband Internet access and domestic and international
calling services through exclusive partnerships with certain Nigerian based
universities. While establishing centers which provide these services on two
university campuses during the fourth quarter of 2004, AfriHUB experienced
significant unanticipated delays and costs in opening these facilities, as well
as greater price sensitivity within the university communities. As a result,
AfriHUB has suspended its planned roll out of service to additional campuses
and is actively pursuing other opportunities to provide technical training in
the Nigerian market.

     Since October 2004, Navigauge has been attempting to raise capital to
expand its data measurement capabilities beyond the Atlanta market. Other than
an aggregate of $1.0 million of short-term promissory notes purchased by us
from October 2004 through April 2005 and an aggregate of $1.0 million of
short-term promissory notes purchased by other existing investors during the
same time period, Navigauge has been unsuccessful in raising such capital.
Accordingly, in light of its prospects, Navigauge's board of directors is
evaluating whether to cease the operations of the company. Accordingly, as of
March 31, 2005, we recognized a loss of $1.2 million relating to the impairment
of the aggregate remaining carrying amount of our equity interest in Navigauge
and the short-term promissory notes. This loss is included in loss on
investments in affiliates on the condensed consolidated statements of
operations.

     To execute its business plan, Miraxis needed to raise significant amounts
of capital in order to launch several satellites. Other than an aggregate of
$0.1 million of promissory notes purchased by us from January 2004 through
March 2005, Miraxis has been unsuccessful in raising capital. Accordingly,
Miraxis' board of directors is expected to dissolve the company in the near
future. The dissolution of Miraxis would not have a material impact on our
financial position or results of operations.

     Following our April 2005 acquisition of a 50% interest in HNS, we will
account for our interest in HNS under the equity method in accordance with FIN
46R, as HNS is a variable interest entity as defined in FIN 46R and we are not
the primary beneficiary as defined in FIN 46R.

Results of Operations for the Three Months Ended March 31, 2005 Compared to
the Three Months Ended March 31, 2004

   Revenues

     Revenues are derived primarily from fees generated from (i) contracts for
product development, consulting and engineering services performed by ESP,
including reimbursable travel and other out-of pocket expenses, (ii) licensing
the right to use certain intellectual property owned by ESP and (iii) the sale
of prepaid cards for Internet access and calling services by AfriHUB. Revenues
from services performed by ESP are recognized using the
percentage-of-completion method for fixed price contracts and as time is
incurred for time and materials contracts, provided the collection of the
resulting receivable is reasonably assured. Revenues from licensing the right
to use intellectual property are recognized as the licensee manufactures
products incorporating or using the licensed intellectual property. Licensees
typically pay a nonrefundable license issuance fee which is recognized as
revenue upon receipt. Revenues from the sale of prepaid cards for Internet
access and calling services are recognized as the customer utilizes the card or
when the card expires.

     Revenues for the three months ended March 31, 2005 decreased to $0.2
million from $0.8 million for the three months ended March 31, 2004, a decrease
of $0.6 million. This decrease was due to a significant decline in demand for
ESP's services in the fourth quarter of 2004, partially offset by revenues from
license fees generated by ESP's intellectual property portfolio and services
provided by AfriHUB at centers opened on two university campuses in Nigeria
during the fourth quarter of 2004. As ESP is no longer seeking new client
engagements and continues to focus on exploiting its intellectual property
portfolio and AfriHUB has suspended its planned roll out of service to
additional campuses, we expect revenues in the remaining quarters of 2005 to
remain relatively unchanged.

   Cost of Revenues

     Cost of revenues includes the salaries and related employee benefits for
ESP employees that provide billable product development, consulting and
engineering services, as well as the cost of reimbursable expenses. Cost of
revenues also includes the costs incurred by AfriHUB to provide Internet access
and calling services. Cost of revenues for the three months ended March 31,
2005 decreased to $0.2 million from $0.7 million for the three months ended
March 31, 2004, a decrease of $0.5 million. This decrease was due to the
reduction in ESP's workforce in January 2005, partially offset by costs
incurred by AfriHUB following the opening of two centers at two university
campuses in Nigeria during the fourth quarter of 2004. As these costs relate to
our current operations, we expect cost of revenues to remain relatively
unchanged in future period as ESP has substantially completed the reduction in
its workforce and AfriHUB has suspended its planned roll out of service to
additional campuses.

   Selling, General and Administrative Expense

     Selling, general and administrative expense includes facilities costs,
finance, legal and other corporate costs, as well as the salaries and related
employee benefits for those employees that support such functions. Selling,
general and administrative expense for the three months ended March 31, 2005
increased to $2.6 million from $1.8 million for the three months ended March
31, 2004, an increase of $0.8 million. This increase relates primarily to the
recognition of non-cash expense in the three months ended March 31, 2005 for
the following items:

     o   approximately $0.4 million of compensation expense related to the 2002
         and 2001 repricing of certain options;
     o   approximately $0.3 million of compensation expense related to an
         option to purchase our common stock issued to a consultant in June
         2004; and
     o   approximately $0.1 million of compensation expense related to warrants
         contingently issuable to certain employees of AfriHUB if certain
         operating and financial milestones are achieved.

For the three months ended March 31, 2004, we recognized $0.3 million of
non-cash expense relating to the option repricing.

     Other factors contributing to the increase include the approximately $0.4
million of expenses incurred by AfriHUB in the three months ended March 31,
2005 (excluding the non-cash expense related to the contingently issuable
warrants described above), partially offset by a $0.2 million decrease in
expenses incurred by ESP in the three months ended March 31, 2005 as compared
to the three months ended March 31, 2004. As these costs relate to our current
operations, we expect our selling, general and administrative expense,
excluding fluctuations arising from the non-cash items noted above, to decrease
in future periods as ESP has significantly reduced the size of its operations
and AfriHUB has suspended the planned roll out of its service to additional
university campuses.

   Depreciation and Amortization Expense

     Depreciation and amortization expense consists of the depreciation of
property and equipment and the amortization of the financing costs associated
with the issuance of our Series A convertible preferred stock. Depreciation and
amortization expense for the three months ended March 31, 2005 increased to
approximately $55,000 from approximately $15,000 for the three months ended
March 31, 2004, an increase of approximately $40,000. This increase is
primarily the result of the capital expenditures made by AfriHUB to build the
network infrastructure necessary for it to launch its service. Given the
reduction in ESP's workforce and the suspension of AfriHUB's planned roll out
to additional university campuses, we anticipate that our capital expenditures
with respect to these two entities will remain nominal in future periods.

   Interest Income, Net

     Interest income, net for the three months ended March 31, 2005 is
comprised primarily of the interest earned on our cash, cash equivalents, and
short-term investments. Interest income, net for the three months ended March
31, 2004 is comprised primarily of the interest earned on our cash, cash
equivalents, and short-term investments and on our notes receivable from the
MSV Joint Venture, Verestar and Motient. Interest income, net for the three
months ended March 31, 2005 decreased to $0.5 million from $2.2 million for the
three months ended March 31, 2004, a decrease of $1.7 million. This decrease
relates primarily to the conversion of our notes receivable from the MSV Joint
Venture in November 2004 and the collection of all amounts due under the notes
receivable from Motient and Verestar in 2004.

   Equity in Loss of Mobile Satellite Ventures LP

     In November 2004, our notes receivable from the MSV Joint Venture, held
through our 80% owned MSV Investors Subsidiary, converted into approximately
23% of the outstanding limited partnership interests in the MSV Joint Venture.
Following the conversion, we account for our interest in the MSV Joint Venture
under the equity method and record expense relating to our proportionate share
of the MSV Joint Venture's net loss. For the three months ended March 31, 2005,
we recorded expense of approximately $3.7 million. We do not expect the MSV
Joint Venture to be profitable in the near future.

   Loss on Investment in Affiliates

     For the three months ended March 31, 2005, we recorded a loss on
investments in affiliates of approximately $1.5 million consisting of $1.2
million relating to the impairment of the aggregate remaining carrying value of
our equity interest in Navigauge and short-term promissory notes purchased from
Navigauge and $0.3 million relating to our proportionate share of Navigauge's
net loss. For the three months ended March 31, 2004, recorded a loss on
investments in affiliates of approximately $0.2 million relating to our
proportionate share of Navigauge's net loss. We will continue to monitor the
carrying value of our remaining investments in affiliates.

   Minority Interest

     For the three months ended March 31, 2005, we recorded minority interest
of approximately $0.7 million relating to the equity in loss, primarily the
equity in loss of the MSV Joint Venture, which is attributable to the group of
unaffiliated third parties who own approximately 20% of our MSV Investors
Subsidiary. For the three months ended March 31, 2004, we recorded minority
interest of approximately $0.3 million relating to the equity in earnings,
primarily the interest income earned on the convertible notes from the MSV
Joint Venture, which is attributable to the group of unaffiliated third parties
who invested in our MSV Investors Subsidiary.

   Net Loss Attributable to Common Stockholders

     For the three months ended March 31, 2005, we recorded net loss
attributable to common stockholders of approximately $9.0 million. For the
three months ended March 31, 2004, we recorded a net loss attributable to
common stockholders of approximately $2.4 million. Included in net loss
attributable to common stockholders for each of the three months ended March
31, 2005 and 2004 was $2.5 million of dividends and accretion related to our
Series A convertible preferred stock. Dividends were accrued related to amounts
payable quarterly on our Series A convertible preferred stock and to the
accretion of the carrying amount of the Series A convertible preferred stock up
to its $100 per share face redemption amount over 13 years.

Liquidity and Capital Resources

     We had approximately $90.4 million in cash, cash equivalents and
short-term investments as of March 31, 2005. Cash used in operating activities
was approximately $2.5 million for the three months ended March 31, 2005 and
resulted primarily from cash used for general corporate overhead including
payroll and professional fees.

     For the three months ended March 31, 2005, cash used in investing
activities, excluding purchases and sales of short-term investments, was $0.3
million and resulted primarily from the $0.4 million used to purchase
investments in Navigauge. Other than the $50.0 million of cash consideration
payable in connection with the HNS transaction, we do not have any future
funding commitments with respect to any of our investments. However, we expect
that the MSV Joint Venture, AfriHUB, Miraxis and Navigauge will require
additional funding from time to time, and we may choose to provide additional
funding, subject to our liquidity and capital resources at the time.

   Hughes Network System Transaction

     On April 22, 2005, we completed the acquisition of 50% of the equity
interests of HNS for $50.0 million in cash and 300,000 shares of the Company's
common stock. Immediately prior to the acquisition, HNSI, a wholly-owned
subsidiary of DIRECTV, contributed substantially all of the assets and certain
liabilities of its very small aperture terminal, mobile satellite and carrier
businesses, as well as the certain portions of its SPACEWAY Ka-band satellite
communications platform that is under development, to HNS, which at the time
was a wholly-owned subsidiary of HNSI. In consideration for the contribution of
assets by HNSI, HNS paid HNSI $190.7 million of cash. This payment represents
the $201.0 million stated in the agreement less an estimated purchase price
adjustment of $10.3 million, which is subject to further adjustment depending
principally upon the closing value of HNS' working capital (as defined in the
agreement). Concurrently, HNS incurred $325.0 million of term indebtedness and
obtained a $50.0 million revolving credit facility. We and HNSI have each
granted a security interest in our respective equity interest in HNS to secure
the obligations of HNS under the term indebtedness. Following the acquisition,
we serve as the managing member of HNS. We will account for our interest in HNS
under the equity method in accordance with FIN 46R, as we will not be the
primary beneficiary, as defined in FIN 46R, of HNS.

   Series A Convertible Preferred Stock Dividend

     In accordance with the terms of our preferred stock, the holders are
entitled to receive quarterly cash dividends commencing on July 1, 2004. The
quarterly payment of approximately $1.4 million, for the three months ended
December 31, 2004, was declared and paid on January 13, 2005. The quarterly
payment of approximately $1.4 million, for the three months ended March 31,
2005, was declared on April 18, 2005 and paid on April 22, 2005. The aggregate
annual dividend payment will be approximately $5.6 million through the
mandatory redemption on June 30, 2012 or such earlier time as the terms of the
preferred stock are renegotiated.

Recently Issued Accounting Standards

     In December 2004, the FASB issued SFAS No. 123R, "Share-Based Payment"
("SFAS No. 123R"), a revision of SFAS No. 123. SFAS No. 123R requires entities
to recognize compensation expense for all share-based payments to employees,
including stock options, based on the estimated fair value of the instrument on
the date it is granted. The expense will be recognized over the vesting period
of the award. SFAS No. 123R is effective for annual periods beginning after
June 15, 2005 and provides entities two transition methods. Under the modified
prospective method, compensation expense is recognized beginning with the
effective date for all awards granted to employees prior to the effective date
that are unvested on the effective date. The modified retrospective method is a
variation of the modified prospective method, except entities can restate all
prior periods presented or prior interim period in the year of adoption using
the amounts previously presented in the pro forma disclosure required by SFAS
No. 123. As we currently account for share-based payments using the intrinsic
value method as allowed by APB Opinion No. 25, the adoption of the fair value
method under SFAS No. 123R will have an impact on our results of operations.
However, the extent of the impact cannot be predicted at this time because it
will depend on levels of share-based payments granted in the future. Had we
adopted SFAS No. 123R in prior periods, the impact of that standard would have
approximated the impact of SFAS No. 123 as described in the disclosure of pro
forma net (loss) income and loss per share in Note 5 to our condensed
consolidated financial statements.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

   Interest Rate Risk

     As of March 31, 2005, we had $90.4 million of cash, cash equivalents and
short-term cash investments. These cash, cash equivalents and short-term cash
investments are subject to market risk due to changes in interest rates. In
accordance with our investment policy, we diversify our investments among
United States Treasury securities and other high credit quality debt
instruments that we believe to be low risk. We are averse to principal loss and
seek to preserve our invested funds by limiting default risk and market risk.

   Foreign Currency Risk

     Through March 31, 2005, our results of operations, financial condition and
cash flows have not been materially affected by changes in the relative value
of non-U.S. currencies to the U.S. dollars. Financial statements of AfriHUB's
Nigerian operations are prepared using the Nigerian Naira as the functional
currency. As we do not use derivative financial instruments to limit our
exposure to fluctuations in the exchange rate with the Naira, we may experience
gains or losses in future periods. The impact of a hypothetical 10% adverse
change in exchange rates on the fair value of Naira denominated assets and
liabilities would be an estimated loss of $0.1 million as of March 31, 2005.

Item 4.  Controls and Procedures

   Evaluation of Disclosure Controls and Procedures

     Our management, with the participation of our chief executive officer and
principal accounting officer, has evaluated the effectiveness of our disclosure
controls and procedures (as such term is defined in Rules 13a-15(e) and
15d-15(e) under the Exchange Act) as of the end of the period covered by this
report. Based on such evaluation, our chief executive officer and principal
accounting officer have concluded that, as of the end of such period, our
disclosure controls and procedures are effective in recording, processing,
summarizing and reporting, on a timely basis, information required to be
disclosed by us in the reports that we file or submit under the Exchange Act.

   Changes in Internal Control Over Financial Reporting

     There has been no change in our internal control over financial reporting
during the first quarter of 2005 that has materially affected, or is reasonably
likely to materially affect, our internal control over financial reporting.

                                    PART II

Item 1.  Legal Proceedings

     On November 19, 2001, five of our former shareholders filed a complaint
against us, certain of our subsidiaries and certain of the then current and
former officers and directors in the United States District Court for the
Southern District of New York, Dovitz v. Rare Medium Group, Inc. et al., No. 01
Civ. 10196. Plaintiffs became owners of restricted stock when they sold the
company that they owned to us. Plaintiffs assert the following four claims
against defendants: (1) common-law fraud; (2) violation of Section 10(b) of the
Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder; (3)
violation of the Michigan Securities Act; and (4) breach of fiduciary duty.
These claims arise out of alleged representations by defendants to induce
plaintiffs to enter into the transaction. The complaint sought compensatory
damages of approximately $5.6 million, exemplary and/or punitive damages in the
same amount, as well as attorney fees. On January 25, 2002, we filed a motion
to dismiss the complaint in its entirety. On June 3, 2002, the Court dismissed
the matter without prejudice. On or about July 17, 2002, the plaintiffs filed
an amended complaint asserting similar causes of action to those asserted in
the original complaint. On September 12, 2002, we filed a motion to dismiss on
behalf of our self and our current and former officers and directors. On March
7, 2003, the Court denied the motion to dismiss, and discovery commenced.
Following the completion of discovery, we filed a motion for summary judgment
on July 30, 2004. Plaintiffs opposed the motion (the "Plaintiffs' Opposition"),
and we responded.

     On September 14, 2004 and again on November 1, 2004, we notified the
plaintiffs that, upon a final adjudication of the matter, we intended to seek
sanctions pursuant to Rule 11 of the Federal Rules of Civil Procedure, based
upon what were believed to be numerous falsehoods contained in the plaintiffs'
complaint and various other filings in the case, including the Plaintiffs'
Opposition. In response, on November 12, 2004, the plaintiffs withdrew certain
of the assertions contained in Plaintiffs' Opposition. We then filed a motion
for sanctions (the "Sanctions Motion") against the plaintiffs seeking
attorney's fees and expenses incurred in connection with the action. The
plaintiffs opposed the sanctions motion on December 17, 2004, and we replied.
On January 13, 2005, the case was dismissed by the Court with prejudice,
subject to reinstatement by either party within 30 days of the order, in light
of an agreement in principle to resolve the matter. On February 11, 2005, the
parties executed a settlement agreement pursuant to which all parties denied
liability relating to all matters, including but not limited to the original
complaint and the Sanctions Motion, exchanged mutual releases, and we agreed to
transfer to the plaintiffs an indirect nominal interest in a former subsidiary
of ours. We did not recognize a charge in connection with this settlement as
the interest in the former subsidiary had no carrying value on our condensed
consolidated balance sheets.

     We and certain of our subsidiaries (along with the Engelhard Corporation)
are parties to an arbitration relating to certain agreements that existed
between or among the claimant and ICC Technologies, Inc., our former name, and
the Engelhard/ICC ("E/ICC") joint venture arising from the desiccant air
conditioning business that we and our subsidiaries sold in 1998. The claimant
has sought $8.5 million for (a) its alleged out of pocket losses in investing
in certain of E/ICC's technology, (b) unjust enrichment resulting from the
reorganization of E/ICC in 1998, and (c) lost profits arising from the fact
that it was allegedly forced to leave the air conditioning business when the
E/ICC joint venture was dissolved. We intend to vigorously dispute this action.

     In August 2003, a former California employee of our discontinued services
subsidiary, filed a putative class action against Rare Medium, Inc. and the
Company, and certain other former subsidiaries that were merged into Rare
Medium, Inc., in Los Angeles County Superior Court captioned Joe Robuck,
individually and on behalf of all similarly situated individuals v. Rare Medium
Group, Inc., Rare Medium L.A., Inc., Rare Medium, Inc., and Rare Medium Dallas,
Inc., Los Angeles County Superior Court Case No. BC300310. The plaintiff filed
the action as a putative class action and putative representative action
asserting that: (i) certain payments were purportedly due and went unpaid for
overtime for employees with five job titles; (ii) certain related violations of
California's overtime statute were committed when these employees were not paid
such allegedly due and unpaid overtime at the time of their termination; and
(iii) certain related alleged violations of California's unfair competition
statute were committed. Plaintiff seeks to recover for himself and all of the
putative class, alleged unpaid overtime, waiting time penalties (which can be
up to 30 days' pay for each person not paid all wages due at the time of
termination), interest, attorneys' fees, costs and disgorgement of profits
garnered as a result of the alleged failure to pay overtime. In February 2005,
we reached an agreement in principle with the plaintiff's counsel pursuant to
which the class action will be dismissed without prejudice. As part of the
agreement, we will receive releases from certain individuals in exchange for an
immaterial settlement payment to each of the individuals. The effectiveness of
a settlement agreement will be subject to court approval. Should the settlement
agreement not be finalized, we intend to vigorously dispute this action.

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds

     None

Item 3.  Defaults Upon Senior Securities

     None

Item 4.  Submission of Matters to a Vote of Security Holders

     None

Item 5.  Other Information

     None

Item 6.  Exhibits

     The following sets forth those exhibits filed pursuant to Item 601 of
Regulation S-K:

     Exhibit
      Number                     Description
     -------                     -----------

       10.1    -  Stockholders Agreement, dated as of May 11, 2005, by and
                  among TerreStar Networks, Inc., MSV Investors, LLC, et al.
       10.2    -  Parent Transfer/Drag Along Agreement, dated as of May 11,
                  2005, by and among TerreStar Networks, Inc., the Company, et
                  al.
       10.3    -  Conditional Waiver and Consent Agreement, dated as of May
                  11, 2005, by and among the Company, Motient Corporation, et
                  al.
       31.1    -  Certification of Jeffrey A. Leddy, Chief Executive Officer
                  and President of SkyTerra Communications, Inc., required by
                  Rule 13a-14(a) of the Securities Exchange Act of 1934,
                  as adopted pursuant to Section 302 of the Sarbanes-Oxley
                  Act of 2002.
       31.2    -  Certification of Craig J. Kaufmann, Controller and Treasurer
                  of SkyTerra Communications, Inc., required by Rule 13a-14(a)
                  of the Securities Exchange Act of 1934, as adopted pursuant
                  to Section 302 of the Sarbanes-Oxley Act of 2002.
       32.1    -  Certification of Jeffrey A. Leddy, Chief Executive Officer
                  and President of SkyTerra Communications, Inc., Pursuant to
                  18 U.S.C Section 1350, as adopted pursuant to Section 906
                  of the Sarbanes-Oxley Act of 2002.
       32.2    -  Certification of Craig J. Kaufmann, Controller and Treasurer
                  of SkyTerra Communications, Inc., Pursuant to 18 U.S.C
                  Section 1350, as adopted pursuant to Section 906 of the
                  Sarbanes-Oxley Act of 2002.

<PAGE>

                                   SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, this Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.


Date:  May 16, 2005                   By: /s/ JEFFREY A. LEDDY
                                          -----------------------------
                                          Jeffrey A. Leddy
                                          Chief Executive Officer and President
                                          (Principal Executive Officer and
                                          Principal Financial Officer)

Date:  May 16, 2005                   By: /s/ CRAIG J. KAUFMANN
                                          ------------------------------
                                          Craig J. Kaufmann
                                          Controller and Treasurer
                                          (Principal Accounting Officer)


<PAGE>

                                                                   Exhibit 10.1


                            TERRESTAR NETWORKS INC.

                            STOCKHOLDERS' AGREEMENT

         STOCKHOLDERS' AGREEMENT (this "Agreement"), dated as of May 11, 2005,
by and among TerreStar Networks Inc., a Delaware corporation (the "Company"),
and the stockholders of the Company listed on Schedule I hereto.

                                    RECITALS

         WHEREAS, the Company and Motient Ventures Holding Inc. ("Motient Sub")
have entered into a purchase agreement (the "Purchase Agreement"), pursuant to
which Motient Sub will purchase shares of common stock, par value $0.001 per
share, of the Company (the "Shares");

         WHEREAS, immediately prior to consummation of the transactions
contemplated by the Purchase Agreement, those certain Rights to Receive Shares
of Common Stock of the Company, dated as of December 20, 2004, as amended
(collectively, the "Rights"), held by the limited partners (or affiliates of
such limited partners) of Mobile Satellite Ventures LP, a Delaware limited
partnership ("MSV LP"), were exchanged for all of the 23,265,428 Shares then
owned by MSV LP, pursuant to the terms and subject to the conditions set forth
in the Rights;

         WHEREAS, certain of the parties hereto are parties to that certain
Securityholders' Agreement, dated as of December 20, 2004 (as amended, the
"Securityholders' Agreement");

         WHEREAS, in connection with the transactions contemplated by the
Purchase Agreement, the Securityholders' Agreement was terminated by the
parties thereto;

         WHEREAS, pursuant to the Company's 2002 Stock Incentive Plan (the
"Option Plan"), the Company has granted, or is obligated to grant, options to
its employees, directors and certain employees of MSV LP (the "Option Holders")
to purchase an aggregate of 3,861,673 Shares (the "Options"); and

         WHEREAS, the Company and the other parties hereto desire to enter into
this Agreement in order to provide, among other things, for certain mutual
restrictions relating to the transfer of the Shares and other rights and
responsibilities as set forth herein.

         NOW, THEREFORE, in consideration of the agreements contained herein
and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereby agree as follows:

         Section 1. Definitions. The terms defined in this Section 1 shall, for
the purposes of this Agreement, have the meanings herein specified.

         "Affiliate" means with respect to a specified Person, any Person that
directly or indirectly controls, is controlled by, or is under common control
with, the specified Person. As used in this definition, the term "control"
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of a Person, whether through
ownership of voting securities, by contract or otherwise.

         "Agreement" has the meaning set forth in the introduction.

         "Business Day" means a day of the year on which banks are not required
or authorized to close in New York City.

         "Columbia/Spectrum Investor Group" means collectively, the
Stockholders set forth under the "Columbia/Spectrum Investor Group" heading in
Schedule I hereto and any Person to whom any member of the Columbia/Spectrum
Investor Group Transfers (as hereinafter defined) Shares pursuant to Section
8.2(b); provided, that the Spectrum Entities shall no longer be included in the
Columbia/Spectrum Investor Group upon the first date on which any of the
Spectrum Entities ceases to own at least the number of Shares owned by such
Spectrum Entity as of the date of this Agreement (as adjusted for stock splits,
reverse stock splits, stock dividends, combinations, recapitalizations and
similar events).

         "Company" has the meaning set forth in the introduction.

         "Consent and Waiver" means that certain Conditional Waiver and Consent
Agreement, dated as of the date hereof, by and among Motient, Motient Sub and
the other signatories thereto.

         "Control Party" means (i) an Affiliate that has direct or indirect
majority voting control of a Stockholder, or (ii) an Affiliate that has a
majority of its voting interests held, directly or indirectly, by a Stockholder
or by Persons that have direct or indirect voting control of a Stockholder.

         "Exchange Act" means the Securities Exchange Act of 1934 and the rules
and regulations promulgated thereunder, as amended.

         "Excluded Securities" means (A) any equity securities in the Company
(i) issued in connection with the acquisition of the business of another
entity, whether by the purchase of equity securities, assets or otherwise,
provided, that such equity securities are issued at a price no less than fair
market value as reasonably determined by the board of directors of the Company,
(ii) issued as part of an Initial Public Offering or other registered
underwritten public offering of the Company's securities, (iii) issued under
the Option Plan or any other equity compensation plan approved by the board of
directors of Company, (iv) issued to financial institutions, financial
syndicates, lessors, vendors or other third parties in connection with bona
fide commercial credit arrangements, equipment financings, or similar
transactions for primarily other than equity financing purposes, and (v) issued
pursuant to the Purchase Agreement, and (B) any debt securities of the Company
(i) issued in connection with the acquisition of the business of another
entity, whether by the purchase of equity securities, assets or otherwise, (ii)
issued as part of a registered underwritten public offering of the Company's
securities, and (iii) issued to lessors, vendors, financial institutions or
other third parties in connection with bona fide equipment financings or
similar transactions in which the proceeds of the borrowings are not intended
to be used by the Company for general corporate purposes or working capital,
including without limitation Purchase Money Indebtedness.

         "Expiration Date" means the date that is the earlier of (i) the first
date on which no Stockholder constitutes a Minority Stockholder or (ii) 60
months after the date of this Agreement; provided, that such date shall be
extended with respect to any Stockholder that is still a Minority Stockholder
as of such date if and for so long as such Stockholder continues to be a
Minority Stockholder and such Minority Stockholder's Proportionate Share (as
hereinafter defined) in the Company is at least 90% of such Minority
Stockholder's Proportionate Share in the Company as of the date of this
Agreement; and provided, further, that any issued and outstanding securities of
the Company that are Excluded Securities will not be included in the
determination of such Minority Stockholder's Proportionate Share. For the
avoidance of doubt, following the Second Transaction the Proportionate Share in
the Company of the Roll-Up Entity will be compared to the aggregate
Proportionate Share in the Company of MSV Investors, TMI Sub and any other
Stockholder that transfers Shares to the Roll-Up Entity in connection with the
Second Transaction, as of the date of this Agreement.

         "Family Member" means, with respect to any Person (i) the spouse,
parents, children, siblings, mother and father-in-law, sons and
daughters-in-law and brothers and sisters-in-law of such Person or of any of
the beneficial owners of such Person, (ii) any trust whose beneficiaries
consist of only one or more of such Person and such persons or (iii) any
partnership or other entity whose owners are one or more of such Person and
such persons.

         "GP Shares" means shares of common stock, par value $0.01 per share,
of MSV GP.

         "Initial Public Offering" means the closing of a firm commitment
underwritten public offering of equity securities in the Company or its
successor with aggregate net proceeds to the Company and any selling
stockholders of greater than $75 million; provided, that following such
offering, the Shares are listed on a United States national securities exchange
or the Nasdaq Stock Market.

         "Intervening Entity" means, as applied to any Stockholder at any time,
any Person the value of which at such time consists principally of its direct
or indirect ownership of equity securities in, or obligations of, the Company.
Without limiting the foregoing, the parties stipulate that, as of the date
hereof, (i) TMI and TMI's general partner are Intervening Entities with respect
to TMI Sub, (ii) Motient Ventures Holding Inc. and MVH Holding Inc. are
Intervening Entities with respect to Motient Sub, and (iii) MSV Investor
Holdings, Inc. is an Intervening Entity with respect to MSV Investors.

         "Limited Holder" means, collectively, (i) Dean Ventures VII, LLC, (ii)
Fabian Souza and (iii) any owners of Shares who acquire or have acquired such
Shares pursuant to the exercise of an Option or similar security granted under
the Option Plan or any other employee stock option plan, stock bonus plan,
stock purchase plan or other equity compensation program approved by the Board
of Directors of the Company; provided, that a Stockholder who acquires Shares
pursuant to clause (iii) and is also either an Affiliate of Motient Sub, MSV
Investors, TMI Sub, the Columbia/Spectrum Investor Group or Dr. Rajendra Singh,
will not constitute a Limited Holder.

         "Limited Investor" has the meaning set forth in that certain Amended
and Restated Stockholders' Agreement, dated as of November 12, 2004, as
amended, by and among MSV GP and the stockholders of MSV GP named therein.

         "Minority Stockholder" means, prior to the consummation of the Second
Transaction, each of MSV Investors, TMI Sub and the Columbia/Spectrum Investor
Group, and, following the consummation of the Second Transaction, the Roll-Up
Entity; provided, however, that (i) each such Stockholder shall no longer
constitute a Minority Stockholder upon the first date on which such Stockholder
ceases to own at least the number of Shares owned by such Stockholder as of the
date of this Agreement (as adjusted for stock splits, reverse stock splits,
stock dividends, combinations, recapitalizations and similar events) (except
that, for the avoidance of doubt, the Columbia/Spectrum Investor Group shall
not cease to constitute a Minority Stockholder solely as a result of a
transaction that causes the Spectrum Entities to cease to be included in the
Columbia/Spectrum Investor Group as contemplated by the proviso to the
definition of "Columbia/Spectrum Investor Group"), and (ii) the Roll-Up Entity
shall no longer be a Minority Stockholder on the first date on which the
Roll-Up Entity ceases to own at least the number of Shares it owns as of the
date of the consummation of the Second Transaction; and provided, further, that
if any Minority Stockholder exercises its right to participate in a Transfer
(as hereinafter defined) as a Tag Along Participant (as hereinafter defined)
pursuant to Section 8.2(a) and Motient Sub (or an Affiliate thereof)
participates in or initiates such Transfer, then such Stockholder still shall
constitute a Minority Stockholder following such Transfer if and to the extent
that the Percentage Reduction of such Stockholder is no greater than the
Percentage Reduction of Motient Sub (or an Affiliate thereof).

         "Motient" means Motient Corporation.

         "Motient Change of Control" means the following: (i) any Person or
group of Persons (within the meaning of Section 13(d) and 14(d) of the Exchange
Act) and their Affiliates have acquired, directly or indirectly, beneficial
ownership (within the meaning of Rule 13d-3 under the Exchange Act) of
securities of Motient representing more than 50% of (a) the voting power or (b)
the issued and outstanding equity securities of Motient; or (ii) any Person or
group of Persons (within the meaning of Section 13(d) and 14(d) of the Exchange
Act) and their Affiliates has become entitled to designate or appoint a
majority of the directors on the board of directors of Motient.

         "Motient Sub" has the meaning set forth in the recitals.

         "Motient Transaction Agreements" means the documents set forth on
Schedule II attached hereto.

         "MSV GP" means Mobile Satellite Ventures GP Inc.

         "MSV LP" has the meaning set forth in the recitals.

         "MSV Investors" means MSV Investors, LLC and any Person to whom MSV
Investors Transfers Shares pursuant to Section 8.2(b).

         "Option Holder" has the meaning set forth in the recitals.

         "Option Holder Representative" means the Company, in its capacity as
the representative of the Option Holders under this Agreement.

         "Option Plan" has the meaning set forth in the recitals.

         "Options" has the meaning set forth in the recitals.

         "Percentage Reduction" means, with respect to a Transfer by a
Stockholder, a fraction, the numerator of which is the difference between the
Stockholder's Proportionate Share immediately prior to the Transfer and the
Stockholder's Proportionate Share immediately following the Transfer, and the
denominator is such Stockholder's Proportionate Share immediately prior to the
Transfer.

         "Person" means any individual, corporation, association, partnership
(general or limited), joint venture, trust, estate, limited liability company,
or other legal entity or organization.

         "Pledge Agreement" means that certain Pledge and Guarantee Agreement,
dated as of November 26, 2001, by and among TMI Sub and the other parties
thereto, as amended, supplemented or revised from time to time.

         "Purchase Agreement" has the meaning set forth in the recitals.

         "Purchase Money Indebtedness" means any debt incurred or assumed by
the Company to finance the cost (including the cost of construction) of an item
of real or personal property or the improvement to such property, the aggregate
principal amount of which debt does not exceed the sum of (i) 100% of such cost
and (ii) reasonable fees and expenses of the Company incurred in connection
therewith.

         "Qualified Sale" means, with respect to a particular corporation (a)
the merger or consolidation of a corporation into or with another corporation
in which the stockholders of the corporation and the Affiliates of such
stockholders immediately preceding such merger or consolidation (solely by
virtue of their shares or other securities of the corporation) shall own less
than 50% of the outstanding voting securities of the surviving corporation; (b)
the sale, Transfer or lease (but not including a Transfer or lease by pledge or
mortgage to a bona fide lender for so long as such lender has no right to
accelerate the maturity of the indebtedness to which such pledge or mortgage
relates), whether in a single transaction or pursuant to a series of related
transactions or plan, of all or substantially all the assets of the
corporation, which assets shall include for these purposes 50% or more of the
outstanding voting capital stock of any subsidiaries of the corporation, the
assets of which constitute all or substantially all the assets of the
corporation and its subsidiaries taken as a whole; (c) the sale, Transfer or
lease (but not including a Transfer or lease by pledge or mortgage to a bona
fide lender for so long as such lender has no right to accelerate the maturity
of the indebtedness to which such pledge or mortgage relates), whether in a
single transaction or pursuant to a series of related transactions, of all or
substantially all the assets of any subsidiaries of the corporation, the assets
of which constitute all or substantially all of the assets of the corporation
and its subsidiaries taken as a whole; (d) the liquidation, dissolution or
winding up the corporation or of such of the corporation's subsidiaries, as
applicable, the assets of which constitute all or substantially all of the
assets of the business of the corporation and its subsidiaries taken as a
whole, whether voluntarily or involuntarily; or (e) any merger, consolidation
or other business combination of the Company into or with another corporation
(i) that is not otherwise a Qualified Sale, (ii) in which the Company is not
the surviving corporation and (iii) as a result of which, the Minority
Stockholders no longer have the minority protections set forth in this
Agreement.

         "Rights" has the meaning set forth in the recitals.

         "Roll-Up Entity" means a single entity or group of related entities
that, upon the consummation of the Second Transaction, directly or indirectly
owns or controls any Shares, units of limited partnership interest in MSV LP,
GP Shares or outstanding employee options granted under an employee option plan
of MSV LP, pursuant to the Second Transaction, and any person to whom the
Roll-Up Entity Transfers Shares pursuant to Section 8.2(b)(ii) or Section
8.2(b)(iii); provided, that in the event the Roll-Up Entity controls, but does
not itself own, or does not own directly, all of the Shares owned by MSV
Investors, TMI Sub and any other Stockholder that Transfers direct or indirect
ownership or control of its Shares to such entity (or their respective
Affiliates), the term "Roll-Up Entity" shall also include all other entities
which directly own such Shares and as to which the Roll-Up Entity has control
and/or indirect ownership. In the event that the Roll-Up Entity includes more
than one entity, such Roll-Up Entity shall deliver a written instrument to the
Company, signed by each entity that comprises the Roll-Up Entity, stating the
method by which the Roll-Up Entity will exercise the minority rights set forth
in this Agreement. Such methodology shall be selected by the entities
comprising the Roll-Up Entity in their discretion, but the methodology
indicated in such written instrument shall be binding on the Roll-Up Entity
unless and until a subsequent written instrument is delivered to the Company,
signed by each entity comprising the Roll-Up Entity, changing such methodology.

         "Second Transaction" means a transaction or series of transactions
involving the consolidation of control, directly or indirectly (by transfer of
ownership or through contract), of the Shares, the units of limited partnership
interest in MSV LP, and the GP Shares, owned by MSV Investors and TMI Sub (or
their respective Affiliates), and which also may involve the consolidation of
control (by transfer of ownership or through contract) of units of limited
partnership interest in MSV LP, GP Shares, Shares and/or outstanding employee
options granted under an employee option plan of MSV LP owned or held by any
member of the Columbia/Spectrum Investor Group (and/or the Spectrum Entities if
such entities cease to be members of the Columbia/Spectrum Investor Group), the
Limited Holders, the TSTR Group and/or the Limited Investors (or their
respective Affiliates), into the Roll-Up Entity; provided, that immediately
prior to the consummation of such transaction or series of transactions, either
MSV Investors or TMI Sub constitutes a Minority Stockholder; and provided,
further, that should any such consolidation of control occur other than by way
of a transfer of direct or indirect ownership (and all rights associated
therewith) in the Shares, or the units of limited partnership interest in MSV
LP and the GP Shares, the transaction or series of transactions giving rise to
such consolidation of control shall be deemed to fall within this definition of
"Second Transaction" only if any and all rights and obligations of the Roll-Up
Entity and any Minority Stockholder are allocated among the Roll-Up Entity and
such Minority Stockholder.

         "Securityholders' Agreement" has the meaning set forth in the
recitals.

         "Shares" has the meaning set forth in the recitals.

         "SkyTerra" means SkyTerra Communications, Inc.

         "Spectrum Entities" means Spectrum Equity Investors IV, L.P., Spectrum
IV Investment Managers Fund, L.P., and Spectrum Equity Investors Parallel IV,
L.P. and any Person to whom any of the Spectrum Entities Transfers Shares
pursuant to Section 8.2(b).

         "Stockholders" means each holder of Shares listed on Schedule I hereof
and, subject to Section 8.3 of this Agreement, any Person acquiring all or a
part of a Stockholder's Shares after the date hereof.

         "TMI" means TMI Communications and Company, Limited Partnership.

         "TMI Sub" means TMI Communications Delaware, Limited Partnership and
any Person to whom TMI Sub Transfers Shares pursuant to Section 8.2(b).

         "Transaction Documents" means (i) this Agreement; (ii) that certain
Cooperation Agreement, dated as of the date hereof, by and among MSV LP and the
Company; (iii) the Consent and Waiver; (iv) the Purchase Agreement; (v) that
certain Assignment of Contracts, dated as of the date hereof, by and between
TerreStar and MSV LP; (vi) that certain Third Amendment to Pledge and Guarantee
Agreement, dated as of the date hereof, by and among TMI Sub and the other
parties thereto; and (vii) that certain Parent Transfer/Drag Along Agreement,
dated as of the date hereof, by and among TerreStar and the parent entities and
their respective subsidiaries named therein.

         "TSTR Group" means TSTR Investors, LLC and its members including Dr.
Rajendra Singh and any Person to whom each such Person Transfers Shares
pursuant to Section 8.2(b).

         Section 2. Board Composition.

         (a) Qualifications of Directors. No person shall be elected or
appointed a director if that person is less than 18 years of age, is of unsound
mind and has been found so by a court, is not an individual, or has the status
of a bankrupt. Directors may, but need not, be Stockholders.

         (b) Number and Designation of Directors. The Board shall consist of
seven (7) directors. Subject to Section 2(c) below, each Stockholder agrees to
use all commercially reasonable efforts (including approving all necessary or
advisable amendments to the Company's certificate of incorporation and/or
bylaws) to cause the board of directors of the Company (the "Board") to be
composed as follows:

                  (i) If and for so long as the Second Transaction has not
occurred:

                           (A) TMI Sub shall be entitled to designate one (1)
director for so long as either (A) TMI Sub is a Minority Stockholder or (B) TMI
or an Affiliate of TMI is the License Holder (as defined below); provided,
that, in the event that TMI or an Affiliate of TMI is neither the License
Holder nor a Minority Stockholder, such director shall be selected by the
affirmative vote of a majority of the Shares held by the Stockholders (other
than Limited Holders);

                           (B) MSV Investors shall be entitled to designate one
(1) director for so long as MSV Investors is a Minority Stockholder; provided,
that, in the event that MSV Investors is not a Minority Stockholder, such
director shall be selected by the affirmative vote of a majority of the Shares
held by the Stockholders (other than Limited Holders);

                           (C) the Minority Stockholders shall be entitled to
designate one (1) director. Such director shall be selected by the affirmative
vote of a majority of the Shares represented by such Minority Stockholders;
provided, that in the event that no Stockholders are Minority Stockholders,
such director shall be selected by the affirmative vote of a majority of the
Shares held by the Stockholders (other than Limited Holders); and

                           (D) Motient Sub shall be entitled to designate four
(4) directors.

                  (ii) If the Second Transaction has occurred, then, following
the Second Transaction:

                           (A) the Roll-Up Entity shall be entitled to
designate the number of directors that the Minority Stockholders (including TMI
Sub and MSV Investors) had the right to designate pursuant to Section 2(b)(i)
above immediately prior to the consummation of the Second Transaction;
provided, that in no event will the Roll-Up Entity be entitled to designate
more than three (3) directors; provided, further, that upon such time as either
(1) the Roll-Up Entity is not a Minority Stockholder or (2) the Expiration Date
has occurred, then any directors designated under this Section 2(b)(ii)(A)
shall be selected by the affirmative vote of a majority of the Shares held by
the Stockholders (other than Limited Holders); and provided, further, that TMI
Sub shall be entitled to designate one (1) director that otherwise would be
designated or selected under this Section 2(b)(ii)(A) for so long as TMI or an
Affiliate of TMI is the License Holder (any director designated pursuant to
Sections 2(b)(i)(A), (B) or (C) or this Section 2(b)(ii)(A), a "Minority
Director"); and

                           (B) Motient Sub shall be entitled to designate four
(4) directors.

         (c) Observer Rights. The Company shall provide the legal holder of the
2 GHz mobile satellite services authorization from Industry Canada relating to
the Company's business (the "License Holder") and the Columbia/Spectrum
Investor Group with notice of each meeting of the Board and shall permit one
designated representative of the License Holder and the Columbia/Spectrum
Investor Group to attend and participate in all discussions of each such
meeting in a nonvoting capacity, and, in this respect shall give the License
Holder and the Columbia/Spectrum Investor Group copies of all notices, minutes,
consents and other material that it provides to directors (collectively, the
"Observation Rights"); provided, that the Company shall not be obligated to
provide the License Holder with Observation Rights if such License Holder
otherwise has the right to select a director pursuant to Sections 2(b)(i)(A) or
2(b)(ii)(A); provided, further, that the License Holder, the Columbia/Spectrum
Investor Group and each of their designated representatives that attend any
Board meeting shall, except as otherwise required by law, hold all matters
discussed at any such meeting in strict confidence as if each such License
Holder, the Columbia/Spectrum Investor Group and each of their designated
representatives were voting members of the Board; provided further, that the
License Holder shall be entitled to Observation Rights in accordance with the
terms of this Section 2(c) only for so long as such License Holder continues to
be the holder of the 2 GHz mobile satellite services authorization from
Industry Canada relating to the Company's business; and provided, further, that
the Columbia/Spectrum Investor Group shall be entitled to Observation Rights in
accordance with the terms of this Section 2(c) only for so long as the
Columbia/Spectrum Investor Group constitutes a Minority Stockholder.

         (d) Resignation. Any director may resign at any time by giving written
notice to the chief executive officer (the "CEO") or the other current
directors. Such resignation shall take effect at the time specified in such
notice or, if the time be not specified, upon receipt thereof by the CEO.
Unless otherwise specified therein, acceptance of such resignation shall not be
necessary to make it effective. In the event of the death, disability,
resignation or removal of any director, the Stockholder(s) which designated
such director shall designate his or her replacement.

         (e) Independence. At least one director designated by Motient Sub
pursuant to Sections 2(b)(i)(D) or 2(b)(ii)(B) and the director designated by
the Minority Stockholders pursuant to Section 2(b)(i)(C) shall (i) be
"independent" within the meaning of the Nasdaq Stock Market's listing standards
in effect from time to time and (ii) have substantial professional experience
in, and familiarity with, the wireless telecommunications industry.

         Section 3. Board Meeting.

         (a) Regular Meetings. The Board shall meet no less often than
quarterly, unless otherwise agreed by at least 80% of the directors. Such
meetings shall be held on such date as shall be determined by the CEO or a
majority of the Board.

         (b) Other Meetings. Other meetings of the Board shall be held at such
times as the Chairman of the Company (the "Chairman"), a vice-chairman of the
Company (a "Vice-Chairman"), the CEO, a majority of the Board or a majority of
the Minority Stockholders shall from time to time determine.

         (c) Notice of Meetings. The Secretary of the Company (the "Secretary")
or any person that the Board or the Secretary delegate to act in the capacity
of the Secretary shall give written notice to the CEO, the President of the
Company (the "President") and each director of each meeting of the Board, which
notice shall state the place, date, time and purpose of such meeting. Notice of
each such meeting shall be given to each director, if by mail, addressed to him
at his residence or usual place of business, at least five (5) Business Days
before the day on which such meeting is to be held, or shall be sent to him at
such place by telecopy, telegraph, cable, or other form of recorded
communication, or may be delivered by electronic mail or be delivered
personally or by telephone not later than forty-eight (48) hours before the
time at which such meeting is to be held; provided, however, that if any
director objects to the holding of such Board meeting at the requested time and
date, such meeting shall be held five (5) Business Days following the date of
such notice; and provided, further, that the foregoing proviso shall not apply
to any adjournment pursuant to the last sentence of Section 3(e)(i) below. A
written waiver of notice, signed by the director entitled to notice, whether
before or after the time of the meeting referred to in such waiver, shall be
deemed equivalent to notice. Neither the business to be transacted at, nor the
purpose of any meeting of the Board, need be specified in any written waiver of
notice thereof. Attendance of a director at a meeting of the Board, without
protest before the conclusion of the meeting that such meeting is not lawfully
called or convened, shall constitute a waiver of notice of such meeting.

         (d) Place of Meetings. The Board may hold its meetings at such place
or places within or without the State of Delaware as the Chairman or CEO may
from time to time determine, or as shall be designated in the respective
notices or waivers of notice of such meetings.

         (e) Quorum and Manner of Acting.

                  (i) A majority of the directors then in office including at
least one Minority Director (or who are members of any committee of the Board)
shall be present in person or by proxy (provided in writing) at any meeting of
the Board (or a committee thereof, as the case may be) in order to constitute a
quorum for the transaction of business at such meeting, and the vote of a
majority of those directors, or members of such committee, present at any such
meeting at which a quorum is present shall be necessary for the passage of any
resolution or act of the Board or such committee, except as otherwise expressly
required by this Agreement. In the absence of a quorum for any such meeting, a
majority of the directors present thereat may adjourn such meeting from time to
time until a quorum shall be present. In the event that (a) the absence of a
quorum is due solely to the absence of a Minority Director and (b) the
directors present adjourn such meeting to a date that is no less than two
business days after the date of the original meeting and provide proper notice
of such meeting to all directors, quorum at such rescheduled meeting shall not
require a Minority Director.

                  (ii) Organization. At each meeting of the Board, one of the
following shall act as chairman of the meeting and preside, in the following
order of precedence:

                           (A) the Chairman;

                           (B) the Vice-Chairman; or

                           (C) any director chosen by a majority of the
directors present.

The Secretary or, in the case of his absence, any person whom the chairman of
the meeting shall appoint shall act as secretary of such meeting and keep the
minutes thereof.

         (f) Committees of the Board. The Board may, by resolution passed by a
majority of the whole Board, designate one or more committees consisting of
three or more directors; provided, that each committee shall consist of at
least one designee of the Minority Stockholders. Except as otherwise expressly
required by this Agreement, any committee of the Board, to the extent provided
in the resolution of the Board designating such committee, shall have and may
exercise all the powers and authority of the Board in the management of the
business and affairs of the Company, and may authorize the seal of the Company
to be affixed to all papers which may require it. Each committee of the Board
shall keep regular minutes of its proceedings and report the same to the Board
and upon request of the Stockholders, to the Stockholders. The notice
provisions set forth in Section 3(c) and the quorum provisions set forth in
Section 3(e) shall apply to any meeting of a committee of the Board.

         (g) Directors' Consent in Lieu of Meeting. Any action required or
permitted to be taken at any meeting of the Board or of any committee thereof
may be taken without a meeting, without prior notice and without a vote, if a
consent in writing, setting forth the action so taken, shall be signed by all
the directors of the Board, in the case of a Board meeting, or all the members
of a committee, in the case of a committee meeting, and such consent is filed
with the minutes of the proceedings of the Board or such committee.

         (h) Action by Means of Telephone or Similar Communications Equipment.
Any one or more members of the Board, or of any committee thereof, may
participate in a meeting of the Board or such committee by means of conference
telephone or similar communications equipment by means of which all persons
participating in the meeting can hear each other, and participation in a
meeting by such means shall constitute presence in person at such meeting.

         (i) Compensation. Directors who are independent in accordance with
Section 2(e) shall receive such compensation as is determined from time to time
by the Board. All other directors shall not receive any salary or compensation
for their services as directors or as members of committees. The directors
shall be entitled to be reimbursed for traveling expenses properly incurred by
them in attending meetings of the Board or any committee thereof. Nothing
herein shall preclude any director from serving the Company in any other
capacity and receiving compensation therefor.

         (j) Selection of Officers. Any changes to the officers of the Company
shall be approved by a vote of the majority of the Board members.

         Section 4. Agreement to Vote Shares to Elect Directors. Each
Stockholder hereby agrees to take all action necessary (including voting or
causing to be voted, or acting by written consent with respect to, any and all
Shares held by him or it, or entitled to be voted by him or it, on the record
date for establishing the Stockholders entitled to vote for the election of
directors of the Company) to cause the designees of Motient Sub, TMI Sub, MSV
Investors and the Minority Stockholders to be elected to the Board, in
accordance with the provisions hereof.

         Section 5. Stockholder Meetings.

         (a) Regular Meetings. The Stockholders shall meet annually, unless
otherwise agreed by the Board. Such meetings shall be held on such date as
shall be determined by a majority of the Board.

         (b) Special Meetings. Special meetings of the Stockholders shall be
held at such times as the Board, the President or a majority in interest of the
Stockholders shall from time to time determine.

         (c) Notice of Meetings. The Secretary shall give written notice to the
President and each Stockholder of each meeting of the Stockholders, which
notice shall state the place, date, time and purpose of such meeting. Notice of
each such meeting shall be given to each Stockholder, if by mail, to the
address set forth with respect to such Stockholder in Schedule I, at least five
(5) Business Days before the day on which such meeting is to be held, or shall
be sent to such Stockholder by telecopy, telegraph, cable, or other form of
recorded communication, or be delivered personally or by telephone not later
than forty-eight (48) hours before the time at which such meeting is to be
held; provided, however, that if any Stockholder objects to the holding of such
Stockholder meeting at the requested time and date, such meeting shall be held
five (5) Business Days following the date that such notice was given. A written
waiver of notice, signed by the Stockholder entitled to notice, whether before
or after the time of the meeting referred to in such waiver, shall be deemed
equivalent to notice. Neither the business to be transacted at, nor the purpose
of any meeting of the Stockholders need be specified in any written waiver of
notice thereof. Attendance of a Stockholder at a meeting of the Stockholders,
without protest before the conclusion of the meeting that such meeting is not
lawfully called or convened, shall constitute a waiver of notice of such
meeting.

         (d) Place of Meetings. The Stockholders may hold their meetings at
such place or places within or without the State of Delaware as the President
may from time to time determine, or as shall be designated in the respective
notices or waivers of notice of such meetings.

         (e) Quorum and Manner of Acting. The Stockholders holding the majority
of the Shares then issued and outstanding and entitled to vote shall be present
in person or by proxy at any meeting of the Stockholders in order to constitute
a quorum for the transaction of business at such meeting, and, except as
otherwise provided herein, the vote of those Stockholders holding a majority of
the Shares, present at any such meeting at which a quorum is present, shall be
necessary for the passage of any resolution or act of the Stockholders, except
as otherwise expressly required by this Agreement. In the absence of a quorum
for any such meeting, holders of a majority of the Shares then issued and
outstanding and entitled to vote present thereat may adjourn such meeting from
time to time until a quorum shall be present.

         (f) Stockholders' Consent in Lieu of Meeting. Any action that has been
authorized, approved or consented to by the Board and is required or permitted
to be taken at any meeting of the Stockholders may be taken without a meeting,
without prior notice and without a vote, if a consent in writing, setting forth
the action so taken, shall be signed by the Stockholders holding the requisite
number of Shares for the taking the relevant action and such consent is filed
with the minutes of the proceedings of the Stockholders.

         (g) Action by Means of Telephone or Similar Communications Equipment.
Any one or more Stockholders may participate in a meeting of the Stockholders
by means of conference telephone or similar communications equipment by means
of which all persons participating in the meeting can hear each other, and
participation in a meeting by such means shall constitute presence in person at
such meeting.

         Section 6. Transfer of Board Designation Rights. The rights of the
Stockholders to designate directors hereunder may not be Transferred (as
hereinafter defined) other than pursuant to Section 8.2(b)(iii).

         Section 7. Financial and Other Information.

         (a) The Company agrees to furnish to TMI Sub, MSV Investors and
Motient Sub, and following the Second Transaction, the Roll-up Entity and
Motient Sub, for so long as such Stockholder is required to account for its
investment in the Company on a consolidated basis or under the equity method of
accounting (determined in accordance with generally accepted accounting
principles in the United States ("GAAP") consistently applied), the following
financial statements and other information:

                  (i) as soon as available, and in any event within 30 days
after the end of each calendar month, copies of the unaudited consolidated and
consolidating statements of income and retained earnings and cash flows for
such month and for the portion of the fiscal year then ended, all in reasonable
detail, all certified by the Company's chief financial officer as complete and
correct and as presenting fairly the information contained therein in
accordance with GAAP, subject to (x) recurring non-material changes resulting
from year-end audit adjustments, and (y) absence of the notes required by GAAP;

                  (ii) as soon as available, and in any event no later than 10
days prior to each date which is the earliest date on which a Stockholder is
required to file a Quarterly Report on Form 10-Q under Section 13(a) or 15(d)
of the Exchange Act for each of the first, second and third quarterly
accounting periods in each fiscal year of the Company, copies of the unaudited
consolidated and consolidating balance sheets of the Company as of the end of
such quarterly accounting period, and of the related consolidated and
consolidating statements of income and retained earnings and cash flows for
such accounting period and for the portion of the fiscal year then ended, all
in reasonable detail and stating in comparative form the unaudited consolidated
and consolidating figures as of the end of and for the corresponding date and
period in the previous fiscal year, all certified by the Company's chief
financial officer as complete and correct and as presenting fairly the
information contained therein in accordance with GAAP, subject to (x) recurring
non-material changes resulting from year-end audit adjustments and (y) absence
of the notes required by GAAP;

                  (iii) as soon as available and in any event no later than 15
days prior to each date which is the earliest date on which a Stockholder is
required to file an Annual Report on Form 10-K under Section 13(a) or 15(d) of
the Exchange Act for the each fiscal year of the Company, copies of the audited
consolidated and consolidating balance sheets of the Company as of the end of
such fiscal year, and of the related audited consolidated and consolidating
statements of income and retained earnings and cash flows for such fiscal year,
all in reasonable detail and stating in comparative form the respective
consolidated and consolidating figures as of the end of and for the previous
fiscal year, complete and correct and as presenting fairly the information
contained therein in accordance with GAAP, and, in the case of such audited
consolidated statements, accompanied by a report thereon of Friedman LLP or a
nationally recognized firm of independent certified public accountants selected
by the Company (the "Accountants") following an examination by the Accountants
in connection with such consolidated financial statements in accordance with
generally accepted auditing standards;

                  (iv) copies of any proxy statements, financial statements and
other reports as the Company shall send or make available generally to its
stockholders;

                  (v) as soon as available, the information that would be
required to be disclosed on a Current Report on Form 8-K filed or furnished
under Section 13(a) or 15(d) of the Exchange Act with respect to any material
event, transaction or other matter that would require a company (in the
Company's position) subject to the reporting requirements of such sections of
the Exchange Act, to file such a Form 8-K with the Securities and Exchange
Commission; and

                  (vi) any other information, including, without limitation,
annual budgets and financial statements or other information concerning the
affairs of the Company that such Stockholder may from time to time reasonably
request and that is capable of being obtained, produced, or generated without
undue effort or expense by the Company or of which it has knowledge (including,
without limitation, a brief statement containing a management discussion and
analysis of the financial condition of the Company and describing the results
of operations and significant events relating to the Company for any fiscal
period).

         (b) In addition, in the event that the Company becomes a "significant
subsidiary" (as defined in Section 1-02(w) of Regulation S-X under the Exchange
Act and applied in Section 3-09 of such Regulation S-X) of a Stockholder, the
Company shall cooperate fully with such Stockholder by providing such
assistance as is required for the Stockholder to prepare its Quarterly Reports
on Form 10-Q in accordance with the requirements of the Exchange Act, and all
of the rules and regulations promulgated thereunder, including, without
limitation, by arranging for the Accountants to prepare quarterly reports in
connection with the Company's quarterly financial statements referred to in
Section 7(a)(iii).

         (c) The Company agrees to furnish to the TSTR Investor Group and the
Columbia/Spectrum Investor Group (and to the Spectrum Entities if such entities
cease to be members of the Columbia/Spectrum Investor Group), and to Motient
Sub, TMI Sub, MSV Investors and the Roll-Up Entity after each such entity is no
longer entitled to receive information pursuant to Section 7(a), for so long as
each such investor group or entity continues to be a Stockholder, the financial
statements and other information set forth in Sections 7(a)(i), (ii), (iii) and
(vi).

         (d) If the Company indicates at the time it provides any financial or
other information to a Stockholder pursuant to this Section 7 that such
information is material non-public information relating to it or any of its
Affiliates ("Non-Public Information"), such Stockholder agrees not to disclose
or reveal any Non-Public Information to any other Person until such time as the
Non-Public Information is disclosed in a press release or a filing with the
Securities and Exchange Commission, unless such Stockholder is required by
applicable law to disclose such Non-Public Information. In the event that such
Stockholder is requested pursuant to, or required by, applicable law to
disclose or reveal any Non-Public Information, such Stockholder agrees that,
prior to disclosing such information, it will provide the Company with notice
of such request or requirement in order to enable the Company to seek an
appropriate protective order or other remedy, or to consult with such
Stockholder with respect to steps that may be taken to resist or narrow the
scope of such request or legal process. Such Stockholder acknowledges that it
is aware that the United States securities laws prohibit any person possessing
Non-Public Information from purchasing or selling any securities on the basis
of the Non-Public Information. Consequently, such Stockholder agrees not to
effect any trades in securities on the basis of the Non-Public Information.
Further, such Stockholder agrees that while it is in possession of the
Non-Public Information, it will refrain from making recommendations about
buying, selling or exercising or redeeming securities. To the extent that the
Stockholder is a public company (or an Affiliate of a public company), the
Company and such Stockholder shall coordinate their efforts with respect to
planning for the public disclosure of the Non-Public Information in connection
with such Stockholder's obligations under the federal securities laws. For
purposes of this Section 7(d), TSTR Investors, LLC and Dr. Rajendra Singh shall
not constitute Affiliates of Motient.

         Section 8. Additional Issuances of Debt or Equity Securities;
Transfers; Drag-Along Rights; Actions Requiring Consent.

         Section 8.1 Additional Issuances of Debt or Equity Securities.

         (a) In order to raise capital for the Company's operations or to
acquire assets, to redeem or retire the Company's debt, or for any other valid
corporate purposes, the Company may, subject to the provisions of this Section
8.1, from time to time determine that it is in the best interests of the
Company to cause the Company to issue additional debt or equity securities to
the Stockholders or other Persons. The Company shall determine the
consideration for and the terms and conditions with respect to any future
issuance of equity securities in the Company.

         (b) The Company shall not issue any debt or equity securities to a
proposed purchaser unless it first:

                  (i) reasonably determines in good faith that there is a bona
fide transaction contemplated and achievable pursuant to which a proposed
purchaser will acquire debt or equity securities of the Company; and

                  (ii) delivers to each Minority Stockholder and the TSTR Group
(each such Person being referred to in this Section 8.1 as a "Buyer") a written
notice (the "Notice of Proposed Issuance") specifying the type and amount of
such equity securities that the Company then intends to issue (the "Offered
Securities"), all of the material terms, including the price (cash or non-cash)
upon which the Company proposes to issue the Offered Securities and stating
that the Buyers shall have the right to purchase the Offered Securities in the
manner specified in this Section 8.1 for the same price per share and in
accordance with the same terms and conditions specified in such Notice of
Proposed Issuance, provided, that if such price consists of non-cash
consideration, a Buyer may purchase the Offered Securities with the same type
and amount of non-cash consideration described in such Notice of Proposed
Issuance or, may instead, pay for such Offered Securities with the cash
equivalent of such price, such equivalent to be agreed to by the parties or
else determined by an independent Expert (as hereinafter defined) or another
nationally recognized investment bank agreed to by the parties. Anything to the
contrary contained herein notwithstanding, (i) a Stockholder who is a Minority
Stockholder shall no longer constitute a Buyer, and shall no longer have the
rights provided in this Section 8.1, upon the first date that such person
ceases to be a Minority Stockholder, and (ii) the TSTR Group shall no longer
constitute a Buyer, and shall no longer have the rights provided in this
Section 8.1, upon the first date that the TSTR Group ceases to own at least the
number of Shares (including, for the avoidance of doubt, all Shares that are
issuable to Dr. Rajendra Singh upon the exercise of any outstanding Options)
owned or held by the TSTR Group (including Dr. Singh) as of April 1, 2005 (as
adjusted for stock splits, reverse stock splits, stock dividends, combinations,
recapitalizations and similar events).

         (c) During the thirty (30) calendar day period commencing on the date
the Company delivers to all of the Buyers the Notice of Proposed Issuance (the
"Thirty Day Period"), the Buyers shall have the option to purchase up to their
Proportionate Share (as defined below) of the Offered Securities at the same
price and upon the same terms and conditions specified in the Notice of
Proposed Issuance. Each Buyer electing to purchase Offered Securities must give
written notice of its election to the Company prior to the expiration of the
Thirty Day Period.

         (d) Each Buyer shall have the right to purchase a portion of the
Offered Securities equal to a percentage determined by dividing (i) the number
of Shares held by such Buyer, by (ii) the total number of Shares then issued
and outstanding to all Buyers. The amount of such Offered Securities that each
Buyer is entitled to purchase under this Section 8.1 shall be referred to as
its "Proportionate Share."

         (e) Each Buyer that exercises in full its right to purchase its
Proportionate Share (each an "Exercising Buyer") shall have a right of
oversubscription such that if any other Buyer fails to elect to purchase his or
its full Proportionate Share of the Offered Securities, the Exercising Buyer(s)
shall, among them, have the right to purchase up to the balance of such Offered
Securities not so purchased. The Exercising Buyers may exercise such right of
oversubscription by electing to purchase more than their Proportionate Share of
the Offered Securities by so indicating in a written notice given within five
(5) days after receiving written notice from the Company of the number of
Shares that were not purchased by any Buyer. If, as a result thereof, such
oversubscription elections exceed the total number of the Offered Securities
available in respect to such oversubscription privilege, the oversubscribing
Exercising Buyers shall be cut back with respect to oversubscriptions such that
each is entitled to purchase a percentage of the balance of such Offered
Securities determined by dividing (i) the number of Shares held by such
Exercising Buyer by (ii) the total number of Shares then issued and outstanding
to all Exercising Buyers, or as they may otherwise agree among themselves.

         (f) The Company shall have the right, until the expiration of, seventy
five (75) consecutive days in the case of a private offering of securities or
one hundred and twenty (120) consecutive days in the case of a public offering
of securities, commencing on the first day immediately following the expiration
of the Thirty Day Period, to issue the Offered Securities not purchased by the
Buyers to the proposed purchaser identified in the Notice of Proposed Issuance
on the terms set forth in such Notice of Proposed Issuance or to any other
party or parties at not less than, and on terms no more favorable in any
material respect to such party or parties thereof than, the price and terms
specified in the Notice of Proposed Issuance. If such remaining Offered
Securities are not issued within such period and at such price and on such
terms, the right to issue in accordance with the Commitment or this Section
8.1(f) shall expire and the provisions of this Agreement shall continue to be
applicable to the Offered Securities.

         (g) Notwithstanding the foregoing, the rights described in this
Section 8.1 shall not apply with respect to the issuance of Excluded
Securities.

         Section 8.2 Transfers. Each Stockholder agrees not to, directly or
indirectly, sell, assign, transfer, pledge, encumber, hypothecate, mortgage or
otherwise dispose of, either voluntarily or involuntarily but not including a
Transfer or lease by pledge or mortgage to a bona fide lender (or to enter into
any contract, option or other arrangement or understanding to do any of the
foregoing) (a "Transfer"), any Shares, except in compliance with this Section
8.2; provided, however, that TMI Sub shall be permitted to pledge its Shares
pursuant to the Pledge Agreement.

         (a) Tag Along Rights.

                  (i) General. No Stockholder (a "Selling Party") may Transfer
(other than pursuant to Section 8.2(b)) any Shares held by such Selling Party
to any Person, unless the terms and conditions of such Transfer shall include a
written offer by the transferee (the "Transfer Notice") to each other
Stockholder (other than Motient Sub and any Affiliates of Motient Sub who also
are Stockholders) and each Option Holder (each, a "Tag Along Participant"), at
the same price (such price, the "Tag Along Price") and on the same terms and
conditions as the Selling Party has agreed to sell its Shares to include in the
Transfer to the transferee a portion of Shares determined in accordance with
this Section 8.2(a); provided, however, that the Transfer by a Stockholder of
any Shares that were issued promptly following the exercise of an Option by
such Stockholder shall not be subject to this Section 8.2(a); and provided,
further, that Option Holders shall not constitute Tag Along Participants with
respect to any Transfer of Shares to the Roll-Up Entity in connection with the
Second Transaction. All rights of the Option Holders under this Section 8.2(a)
shall be exercised by the Option Holder Representative, and any notices or
communications required to be given to the Option Holders may instead be
provided solely to the Option Holder Representative.

                  (ii) Obligation of Transferee to Purchase. The transferee of
the Selling Party shall purchase from the Selling Party and each Tag Along
Participant the portion of such Selling Party's and Tag Along Participant's
Shares that such Selling Party and Tag Along Participant desire to sell;
provided, that in the event that the transferee is not willing to purchase all
of the shares the Selling Party and the Tag Along Participants desire to sell,
the transferee shall purchase from the Selling Party and each Tag Along
Participant a portion of such securities that shall not exceed the Maximum Tag
Along Portion (as hereinafter defined) and, if such portion does exceed the
Maximum Tag Along Portion, the transferee shall purchase only the Maximum Tag
Along Portion. For purposes hereof, the term "Maximum Tag Along Portion" means
a portion of the Selling Party's or a Tag Along Participant's Shares equal to
the aggregate number of Shares the transferee actually proposes to purchase
multiplied by a fraction, the numerator of which shall be the number of Shares
issued and owned by such Selling Party or Tag Along Participant (including, for
the avoidance of doubt, in the case of participating Option Holders, Shares to
be acquired upon the exercise of any vested Options owned by such Option Holder
and to be included in such Transfer) and the denominator of which shall be the
aggregate number of Shares owned by the Selling Party and each Tag Along
Participant exercising its rights under this Section 8.2(a) (including, for the
avoidance of doubt, Shares to be acquired upon the exercise of vested Options
owned by participating Option Holders and to be included in such Transfer);
provided, however, that if the Selling Party proposes to Transfer Shares
representing 50% or more of the issued and outstanding Shares, the Maximum Tag
Along Portion for each Tag Along Participant shall be equal to all of the
Shares owned by such Tag Along Participant. To the extent one or more Tag Along
Participants exercise such right of participation in accordance with the terms
and conditions of this Section 8.2(a), the number of shares that the Selling
Party may sell in the transaction shall be correspondingly reduced. For the
avoidance of doubt, the Option Holders shall be treated as a single Tag Along
Participant for purposes of this Section 8.2(a), and the number of Shares owned
by such Option Holders and proposed to be sold by such Option Holders shall be
determined by the Option Holder Representative in its reasonable discretion
based on instructions received from the Option Holders.

                  (iii) Exercise. The tag-along right may be exercised by each
Tag-Along Participant by delivery of a written notice to the Selling Party (the
"Tag Along Notice") within 30 calendar days following receipt of the Transfer
Notice. The Tag Along Notice shall state the number of Shares that such Tag
Along Participant wishes to include in such Transfer to the transferee under
such Tag Along Participant's right to participate. Upon the giving of a Tag
Along Notice, such Tag Along Participant shall be entitled and obligated to
sell the number of Shares set forth in the Tag Along Notice, to the transferee
on the terms and conditions set forth in the Transfer Notice (the "Transferee
Terms"); provided, however, the Selling Party shall not consummate the sale of
any Shares offered by it if the transferee does not purchase all Shares which
each Tag Along Participant is entitled and desires to sell pursuant hereto.
After expiration of the 30 calendar-day period referred to above, if the
provisions of this Section have been complied with in all respects, the Selling
Party and each Tag Along Participant that delivered a Tag Along Notice shall
Transfer the Shares determined in accordance with Section 8.2(a)(ii) to the
transferee on the Transferee Terms on the sale date proposed in the Transfer
Notice (or such other date within sixty (60) days of such proposed sale date as
may be agreed among the participants in such Transfer).

                  (iv) Several Liability. Anything to the contrary contained
herein notwithstanding, the Selling Party agrees to use its good faith
reasonable efforts to ensure that the applicable Transferee Terms provide for
several, and not joint, liability, with respect to the indemnification and
comparable obligations contained within such Transferee Terms.

                  (v) The tag-along rights set forth in this Section 8.2(a)
shall not be deliberately circumvented by a Selling Party under circumstances
where any of the parties having tag-along rights hereunder would have a
reasonable expectation that such tag-along rights would apply.

         (b) Subject to Sections 8.2(c), (d) and (e), a Stockholder may at any
time and from time to time (i) Transfer any of its Shares to any of its Family
Members provided, that such Stockholder shall provide the other Stockholders
notice of the identity of such Family Member transferee, (ii) Transfer all or
part of its Shares to its members, partners, shareholders or other equity
holders, as the case may be, pro-rata in accordance with the governing
documents of the Stockholder and without consideration, or (iii) Transfer all
or part of its Shares to a Control Party or a wholly-owned subsidiary of such
Stockholder including but not limited to by way of merger, reverse merger or
other business combination; provided, that in the event that the Stockholder is
not a wholly-owned subsidiary of the Control Party, such Stockholder and
Control Party agree with the Company in writing that such Control Party shall
Transfer such Shares back to such Stockholder immediately upon such Person
ceasing to be a Control Party of such Stockholder; and provided, further, that
such Stockholder and wholly-owned subsidiary agree with the Company in writing
that such wholly-owned subsidiary shall Transfer such Shares back to such
Stockholder immediately upon such Person ceasing to be a wholly-owned
subsidiary of such Stockholder.

         (c) In addition to any other requirements of this Agreement relating
to a Transfer of Shares, no Shares shall be Transferred or assigned unless the
transferee (i) executes an instrument reasonably satisfactory to the Company
accepting all of the terms and conditions relating to a Stockholder set forth
in this Agreement, (ii) pays any reasonable expenses of the Company incurred in
connection with such Transfer or assignment (including, without limitation,
attorney's fees) and (iii) is either an "accredited investor" (as defined in
Rule 501 promulgated under the Securities Act of 1933, as amended (the
"Securities Act")) or provides an opinion of counsel reasonably acceptable to
the Company that the Transfer will not require registration under the
Securities Act.

         (d) Notwithstanding any other provisions of this Agreement to the
contrary, the Company may prohibit any proposed Transfer if, in the reasonable
determination of the Company, such Transfer would cause the Company to be in
violation of any material applicable state or federal laws or other material
applicable legal requirement.

         (e) To the extent that any regulatory approval, notification or other
submission or procedure is required or customarily provided in connection with
the exercise of any right or obligations as set forth in this Agreement with
respect to the Transfer or assignment of the Shares (including, but not limited
to, Federal Communications Commission approvals (if required), filings under
the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and
applicable securities laws), such Transfer or assignment pursuant to this
Agreement will be delayed and will only take place after such approval,
notification or other submission or procedure has been obtained, submitted or
completed, as reasonably determined by the Company.

         (f) Subject to Sections 8.2(c), (d), and (e), for purposes of this
Agreement, the sale or Transfer of any equity or other ownership interests in
any Intervening Entity other than to an entity that is a wholly-owned
subsidiary of such Stockholder or of which such Stockholder is a direct or
indirect wholly-owned subsidiary (an "Intervening Entity Ownership Change")
shall be deemed to constitute a Transfer of the aggregate number of Shares held
by that Stockholder multiplied by a fraction, the numerator of which is the
percentage ownership of the Intervening Entity so sold or Transferred and the
denominator of which is 100%. If such a deemed Transfer of Shares occurs
without compliance with or as permitted by the provisions of Sections 8.2(a)
through (e) (as applicable) of this Agreement then, without limiting the rights
of the Company or the other Stockholders at law or in equity, all of the
Stockholders (other than the Stockholder which is so deemed to have Transferred
Shares) shall have the right to purchase their Proportionate Shares (except
that in determining such Stockholders' Proportionate Share, any Shares (and
Shares issuable upon the exchange, conversion or exercise of warrants or other
convertible instruments) owned directly or indirectly by the Intervening Entity
shall be excluded from the denominator) so deemed Transferred for the same
amount of consideration to be given to the Intervening Entity or its owners, in
respect of the Intervening Entity Ownership Change.

         (g) Any attempted Transfer of Shares in violation of this Agreement
shall be void and of no effect.

         Section 8.3 New Stockholders. A Person (other than a current
Stockholder) who purchases from the Company Shares issued pursuant to Section
8.1 shall become a Stockholder, pursuant to the terms and subject to the
conditions set forth in this Agreement upon furnishing to the Company (a) a
subscription agreement, in form reasonably satisfactory to the Company, which
agreement shall include an acceptance by such Person of all the terms and
conditions of this Agreement, and (b) such other documents as the Company deems
reasonably necessary or advisable. Such admission shall become effective on the
date that the Company determines that such conditions have been satisfied.
Section

         8.4 Drag-Along Rights. If (a) Stockholders holding a majority of the
outstanding Shares (the "Majority Holders") determine to Transfer or exchange
(in a merger, business combination or otherwise) in one or a series of related
bona fide arm's-length transactions (collectively, the "Drag-Along
Transaction") to an unrelated and unaffiliated third party all of the Shares
held by such Stockholders; (b) the Drag-Along Transaction is a Fair Transaction
(as hereinafter defined); and (c) the third party transferee agrees in
connection with such Drag-Along Transaction to acquire all outstanding Options
or the Shares underlying such Options at a price per underlying Share that is
equal to the price per Share to be received by the Majority Holders, then, upon
thirty (30) days' written notice to the Stockholders who are not Majority
Holders, the Company and the Option Holders (the "Drag-Along Notice"), which
notice shall include reasonable details of the proposed transaction, including
the consideration to be received by the Stockholders, each other Stockholder
shall be obligated to, and shall sell, Transfer and deliver, or cause to be
sold, Transferred and delivered, to such third party, all of its Shares in the
same transaction at the closing thereof (and will deliver such Shares free and
clear of all liens, claims, or encumbrances except this Agreement) (or shall
vote in favor of or consent to any transaction requiring the vote or consent of
Stockholders), and shall otherwise cooperate in the consummation of such
transaction, and the consideration to be paid to the Stockholders and the
Option Holders shall be distributed to the Stockholders and the Option Holders
on a pro rata basis in accordance with their respective Proportionate Shares.

         (a) For purposes hereof, a "Fair Transaction" means a Drag-Along
Transaction in which the aggregate consideration to be received by all
Stockholders and Option Holders, as determined in accordance with this Section
8.4(b) (the "Drag Along Consideration"), is no less than 95% of the then
current fair market value of the Company, as determined in accordance with this
Section 8.4(b) (the "Current Fair Market Value"). In determining the Drag Along
Consideration and the Current Fair Market Value, the following provisions shall
apply:

                  (i) In determining the Drag Along Consideration, the Board
shall make a good faith determination regarding the value of the consideration
to be received by the Stockholders and the Option Holders in connection with
the Drag-Along Transaction. If the Drag Along Consideration, in whole or in
part, consists of cash, the Drag Along Consideration shall be deemed to be the
amount of cash to be paid to the Stockholders and the Option Holders, plus the
value of any property other than cash to be received by the Stockholders and
the Option Holders, determined as provided in the next sentence. In the event
that the Drag Along Consideration, in whole or in part, consists of shares of
capital stock or securities convertible or exchangeable for any capital stock,
then the Drag Along Consideration shall be deemed to be the fair value thereof
based on the average of the closing or reported price of such securities during
the ten trading days immediately preceding such determination, if such
securities are listed on a national securities exchange or quoted on Nasdaq or
the OTC Bulletin Board. In the event that the Drag Along Consideration, in
whole or in part, consists of shares of capital stock (or securities
convertible or exchangeable for any such capital stock) that is not listed on a
national securities exchange or quoted on Nasdaq or the OTC Bulletin Board, or
any other property (other than cash), then the Drag Along Consideration shall
be deemed to be the fair value thereof as determined in good faith by the
Board, irrespective of any accounting treatment.

                  (ii) In determining the Current Fair Market Value, the Board
shall make a good faith determination regarding the current fair market value
of the Company, based on the most recent and current information available to
the Board, including, without limitation, the most recent financial information
with respect to the Company's results of operations, balance sheet, financial
position, liabilities, stockholders' equity, and cash flows, and taking into
account all relevant regulatory, operational, contractual, and other
information and factors regarding the Company's value available to the Board,
irrespective of accounting treatment.

                  (iii) Promptly following the Board's determination of the
Drag Along Consideration and the Current Fair Market Value pursuant to Sections
8.4(b)(i) and (ii), the Company shall prepare and deliver to each Stockholder a
notice stating the Board's determination of the amount of the Drag Along
Consideration and the Current Fair Market Value (the "Fair Value Notice"). The
Board's determination of the Drag Along Consideration and the Current Fair
Market Value shall be final and binding on the parties to this Agreement unless
a Stockholder who is not a Majority Holder (an "Objecting Holder") objects by
giving written notice to the Company and the Majority Holders within five
business days after such Stockholder's receipt of the Fair Value Notice (the
"Objection Notice"). Such Objection Notice shall contain the Objecting Holder's
determination of the amount of the Drag Along Consideration and the Current
Fair Market Value. Upon receipt of a timely Objection Notice, the Company and
the Objecting Holder (or the Objecting Holders) shall attempt in good faith to
resolve any differences with respect to the Drag Along Consideration and the
Current Fair Market Value. If the parties are unable to reach an agreement with
respect to the Drag Along Consideration and the Current Fair Market Value
within 20 days following receipt of the Objection Notice, such objections and
the Company's responses thereto shall be reviewed by one of the investment
banking or appraisal firms set forth on Schedule III hereto chosen by the
Company (an "Expert"); provided, that such Expert is independent of the
Objecting Holder (or Objecting Holders) and the Company at the time of such
determination. The Expert shall resolve all such objections and finally
determine, as soon as practicable and in any event within 20 days after
receiving written instructions to resolve such objections, the Drag Along
Consideration and the Current Fair Market Value. The determination of the Drag
Along Consideration and the Current Fair Market Value by the Expert shall be
final and binding on the Company and the Stockholders. The fees and expenses of
the Expert shall be borne by the party (either the Company or the Objecting
Holders, as a group) whose determination of the Current Fair Market Value
(which, in the case of the Objecting Holders, shall be the average of the
Current Fair Market Values set forth in all Objection Notices) was further from
the Expert's determination of Current Fair Market Value, or equally by the
Company and the Objecting Holders in the event that the determination by the
Expert is equidistant between the determination of the Current Fair Market
Value contained in the Fair Value Notice and the average of the Current Fair
Market Values set forth in all Objection Notices.

         Section 8.5 Actions Requiring Consent.

         (a) Actions Requiring Consent of the Minority Stockholders. The
Company shall not, nor shall it permit any subsidiary to, take any of the
following actions without first obtaining the approval (by vote or written
consent, as provided by law) of a majority of the Shares held by the Minority
Stockholders (such approval not to be unreasonably withheld):

                  (i) enter into a transaction or a series of transactions,
directly or indirectly, with Motient (or an Affiliate thereof);

                  (ii) enter into a transaction or series of transactions in
which Motient (or an Affiliate thereof) will receive consideration that (A) is
different than the consideration to be received by other Stockholders, (B) has
a different per share value than the consideration received by the other
Stockholders, or (C) is not based solely on the Proportionate Share owned by
Motient (or such Affiliate); provided, that this Section 8.5(a)(ii) shall not
apply to a transaction or series of transactions in which the Minority
Stockholders and the TSTR Group are entitled to exercise the preemptive rights
set forth in Section 8.1 hereof;

                  (iii) amend, alter or repeal any provision of (A) its
certificate of incorporation, (B) its bylaws, (C) this Agreement, and (D) that
certain Parent Transfer/Drag Along Agreement, dated as of the date hereof, by
and among the Company and the parent entities and their respective subsidiaries
named therein; and

                  (iv) take any action that could result in the liquidation,
dissolution or winding up of the Corporation.

         (b) Actions Requiring Consent by TMI Sub or MSV Investors. The Company
shall not, nor shall it permit any subsidiary to, consummate a Qualified Sale
of TerreStar at a per Share price that is less than $24.42 (as adjusted for
stock splits, reverse stock splits, stock dividends, combinations,
recapitalizations and similar events) without first obtaining the approval (by
vote or written consent, as provided by law) (such approval not to be
unreasonably withheld) of (A) prior to the consummation of the Second
Transaction, either TMI Sub or MSV Investors, and (B) following the
consummation of the Second Transaction, the Roll-Up Entity.

         (c) Actions Requiring Consent by TMI Sub and MSV Investors Following a
Motient Change of Control. Following a Motient Change of Control, the Company
shall not, nor shall it permit any subsidiary to, take any of the following
actions without first obtaining the approval (by vote or written consent, as
provided by law) (such approval not to be unreasonably withheld) of (A) prior
to the consummation of the Second Transaction, each of TMI Sub and MSV
Investors, and (B) following the consummation of the Second Transaction, the
Roll-Up Entity:

                  (i) approve the business plan and annual operating budget of
the Company, including capital expenditures; and

                  (ii) approve the appointment or replacement of the CEO.

         Section 8.6 Termination. Sections 8.1, 8.5(a) and 8.5(b) shall
terminate and have no further force and effect upon the Expiration Date;
provided, that with respect to Section 8.1, such date shall be extended with
respect to the TSTR Group if and for so long as the TSTR Group's Proportionate
Share in the Company is at least 90% of the TSTR Group's Proportionate Share in
the Company as of April 1, 2005; and provided, further, that any issued and
outstanding securities of the Company that are Excluded Securities will not be
included in the determination of the TSTR Group's Proportionate Share.

         Section 8.7 Rights of Limited Holders. Notwithstanding anything to the
contrary contained in this Agreement, except for such rights as may otherwise
be expressly required by the Delaware General Corporation Law, each Limited
Holder (a) shall not have any of the rights, privileges or preferences granted
under this Agreement to a Stockholder including without limitation, any rights
contained in this Agreement in the event of any issuance, sale or other
Transfer of Shares or other securities of the Company by the Company or another
Stockholder; provided, that each Limited Holder shall have the tag along rights
set forth in Section 8.2(a), and (b) shall otherwise be subject to all the
obligations and restrictions associated with being a Stockholder as provided in
this Agreement, including without limitation, the restrictions on Transfer set
forth in Section 8 of this Agreement. Upon any Transfer by a Limited Holder in
accordance with the terms of this Agreement, such transferee shall not be
deemed to be a Limited Holder.

         Section 9. Legends. Each Stockholder consents to the Company inserting
appropriate legends referencing the restrictions and obligations contained in
this Agreement on the certificates representing the Shares held by the
Stockholders on or after the date of this Agreement.

         Section 10. Stockholders' Representation. Each Stockholder hereby
represents that, notwithstanding anything herein to the contrary, it has no
immediate plan or intention to consummate any Transfer of Shares other than
pursuant to the Second Transaction.

         Section 11. Miscellaneous.

         (a) Representation. No Stockholder is a party to any other agreement
other than the Pledge Agreement, the Motient Transaction Agreements and the
Transaction Documents, with respect to the Transfer or disposition of voting
rights with respect to any Shares.

         (b) Severability. Should any one or more of the provisions of this
Agreement be determined to be illegal or unenforceable, each other provision of
this Agreement shall be given effect separately from the provision or
provisions determined to be illegal or unenforceable and shall not be affected
thereby.

         (c) No Waiver. No failure or delay on the part of any party in
exercising any right, power or remedy hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any such right, power or
remedy preclude any other or further exercise thereof or the exercise of any
other right, power or remedy hereunder.

         (d) Entire Agreement. This Agreement and the other Transaction
Documents constitute the entire agreement among the parties pertaining to the
subject matter hereof and supersede all prior agreements and understandings of
the parties in connection herewith.

         (e) Amendment and Modification. Subject to Section 8.5(a)(iii), this
Agreement may be amended, modified and supplemented only by written agreement
of a majority of the Shares held by the Stockholders (or, in the event the
provision to be amended contains language requiring the consent of a greater
number of the Shares such greater number); provided, however, that any
amendment, modification or supplement to this Agreement that would adversely
affect any individual Stockholder, or group of Stockholders, in a manner
different than its effect on other Stockholders shall require the prior written
consent of such Stockholder(s). Notwithstanding the foregoing, if the Company
shall admit any new stockholder and the Board shall determine that the Board
should be expanded to allow for representation on the Board by such new
stockholder, this Agreement may be amended by the written agreement of the
holders of a majority of the then outstanding Shares to provide for one or more
additional directors (the number of such additional directors to be reasonably
proportionate to such new Stockholder's Proportionate Share), which director(s)
shall be designated by such new Stockholder.

         (f) Remedies. The parties acknowledge and agree that the breach of any
of the terms of this Agreement will cause irreparable injury for which an
adequate remedy at law is not available. Accordingly, it is agreed that each
party hereto shall be entitled to an injunction, restraining order or other
equitable relief to prevent breaches of this Agreement and to enforce
specifically the terms and provisions hereof in any court of competent
jurisdiction in the United States or any state thereof, without the requirement
of the posting of any bond. Such remedies shall be cumulative and non-exclusive
and shall be in addition to any other rights and remedies the parties may have
under this Agreement.

         (g) Notices. All notices provided for in this Agreement shall be in
writing, duly signed by the party giving such notice, and shall be delivered
personally, sent by a nationally recognized overnight courier, telecopied or
mailed by registered or certified mail, as follows:

                  (i) If given to the Company, at the Company's mailing address
set forth below:

         TerreStar Networks Inc.
         7925 Jones Branch Drive
         McLean, VA 22102
         Fax: (703) 873-2801
         Attention:  Chief Executive Officer

         with a copy to each Stockholder as set forth in clause (ii) below.

                  (ii) If given to any Stockholder, at the address set forth on
Schedule I hereof (or as modified from time to time by a Stockholder upon
written notice to the Company).

                  (iii) If given to the Option Holder Representative, at the
Option Holder Representative's mailing address set forth below:

        TerreStar Networks Inc.
        c/o Mobile Satellite Ventures LP
        10802 Parkridge Boulevard
        Reston, VA 20191
        Fax: (703) 390-2770
        Attention:  Secretary (Option Holder Representative)

Notices delivered personally to an addressee or sent by overnight courier shall
be deemed to have been given upon such delivery. Notices sent by telecopier
shall be deemed to have been given upon confirmation by telecopy answerback
(provided that the sending of any such notice is followed promptly by the
mailing of the original of such notice). Notices mailed by registered or
certified mail shall be deemed to have been given upon the expiration of five
(5) Business Days after such notice has been deposited in the mail.

         (h) Governing Law; Consent to Jurisdiction. This Agreement shall be
governed by and construed in accordance with the law of the State of Delaware
without regard to any applicable principles of conflicts of law. Each party
agrees that, in connection with any legal suit or proceeding arising with
respect to this Agreement, it shall submit to the non-exclusive jurisdiction of
the United States District Court for the Southern District of New York or the
applicable New York state court located in New York County and agrees to venue
in such courts.

         (i) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same instrument.



                          [Signature pages to follow]
<PAGE>

         IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first written above.

                                      TERRESTAR NETWORKS INC.

                                      By: /s/ Wharton B. Rivers, Jr.
                                          -------------------------------------
                                          Name:  Wharton B. Rivers, Jr.
                                          Title: President and Chief Executive
                                                 Officer


                                      THE OPTION HOLDER REPRESENTATIVE:

                                      TERRESTAR NETWORKS INC.

                                      By: /s/ Wharton B. Rivers, Jr.
                                          -------------------------------------
                                          Name:  Wharton B. Rivers, Jr.
                                          Title: President and Chief Executive
                                                 Officer
<PAGE>

                                      MOTIENT VENTURES HOLDING INC.

                                      By: /s/ Chris Downie
                                          -------------------------------------
                                          Name:  Chris Downie
                                          Title: Executive Vice President


                                      TMI COMMUNICATIONS DELAWARE, LIMITED
                                      PARTNERSHIP

                                      By: 3924505 Canada, Inc., its General
                                          Partner

                                      By: /s/ Richard O'Reilly
                                          -------------------------------------
                                          Name:  Richard O'Reilly
                                          Title:  President
<PAGE>

                                      MSV INVESTORS, LLC

                                      By: MSV Investors Holdings, Inc.,
                                          Its Managing Member

                                      By: /s/ Jeffrey Leddy
                                          -------------------------------------
                                          Name:  Jeffrey Leddy
                                          Title: Chief Executive Officer


                                      TSTR INVESTORS, LLC


                                      By: /s/ Rajendra Singh
                                          -------------------------------------
                                          Name:  Rajendra Singh
                                          Title:  President and CEO
<PAGE>

                                      SPECTRUM EQUITY INVESTORS IV, L.P.

                                      By: Spectrum Equity Associates IV, L.P.
                                          Its General Partner

                                      By: /s/ Kevin J. Maroni
                                          -------------------------------------
                                          Name:  Kevin J. Maroni
                                          Title: Manager


                                      SPECTRUM IV INVESTMENT MANAGERS' FUND,
                                      L.P.

                                      By: /s/ Kevin J. Maroni
                                          -------------------------------------
                                          Name:  Kevin J. Maroni
                                          Title: Manager


                                      SPECTRUM EQUITY INVESTORS PARALLEL IV,
                                      L.P.

                                      By: Spectrum Equity Associates IV, L.P.,
                                          its General Partner

                                      By: /s/ Kevin J. Maroni
                                          -------------------------------------
                                          Name:  Kevin J. Maroni
                                          Title: General Partner
<PAGE>

                                      COLUMBIA CAPITAL EQUITY PARTNERS III
                                      (QP), L.P.

                                      By: Columbia Capital Equity Partners III,
                                          L.P., as General Partner

                                      By: /s/ Donald A. Doering
                                          -------------------------------------
                                          Name:  Donald A. Doering
                                          Title: Chief Financial Officer


                                      COLUMBIA CAPITAL EQUITY PARTNERS III
                                      (AI), L.P.

                                      By: Columbia Capital Equity Partners III,
                                          L.P., as General Partner

                                      By: /s/ Donald A. Doering
                                          -------------------------------------
                                          Name:  Donald A. Doering
                                          Title: Chief Financial Officer


                                      COLUMBIA CAPITAL EQUITY PARTNERS III
                                      (CAYMAN), L.P.

                                      By: Columbia Capital Equity Partners
                                          (Cayman) III, Ltd., as General Partner

                                      By: /s/ Donald A. Doering
                                          -------------------------------------
                                          Name:  Donald A. Doering
                                          Title: Chief Financial Officer
<PAGE>

                                      COLUMBIA CAPITAL INVESTORS III, LLC

                                      By: Columbia Capital Equity Partners III,
                                          L.P., as General Partner

                                      By: /s/ Donald A. Doering
                                          -------------------------------------
                                          Name:  Donald A. Doering
                                          Title: Chief Financial Officer


                                      COLUMBIA CAPITAL EMPLOYEE INVESTORS III,
                                      L.L.C.

                                      By: Columbia Capital III, L.L.C., its
                                          Manager

                                      By: /s/ Donald A. Doering
                                          -------------------------------------
                                          Name:  Donald A. Doering
                                          Title: Chief Financial Officer
<PAGE>

                                      DEAN VENTURES VII, LLC

                                      By: /s/ Dean L. Wilde, Jr.
                                          -------------------------------------
                                          Name:  Dean L. Wilde, Jr.
                                          Title: Member

                                      /s/ Fabian Souza
                                      -----------------------------------------
                                      FABIAN SOUZA
<PAGE>

                                                                   Exhibit 10.2


                 TerreStar Parent Transfer/Drag Along Agreement

         Reference is made to that certain Stockholders' Agreement, dated as of
May 11, 2005 (the "Stockholders' Agreement"), among TerreStar Networks Inc.
("TerreStar"), Motient Ventures Holdings Inc. ("Motient Sub"), TMI
Communications Delaware, Limited Partnership ("TMI Sub"), MSV Investors, L.L.C.
("MSV Investors") and the other stockholders of TerreStar named therein.
Capitalized terms used in this Agreement but not defined shall have the meaning
ascribed to such terms in the Stockholders' Agreement.

     1.  Motient hereby represents and warrants to TMI Communications and
         Company, Limited Partnership ("TMI") and 3924505 CANADA INC. ("TMI Sub
         GP" and together with TMI, the "TMI Entities") and SkyTerra
         Communications, Inc. ("SkyTerra") that it directly owns 100% of the
         capital stock of MVH Holdings Inc. ("MVH"), which directly owns 100%
         of the capital stock of Motient Sub.

     2.  The TMI Entities hereby jointly and severally represent and warrant to
         Motient and SkyTerra that the TMI Entities directly own 100% of the
         equity interests of TMI Sub.

     3.  SkyTerra hereby represents and warrants to Motient and TMI that it
         directly owns 100% of the capital stock of MSV Investors Holdings,
         Inc. ("MSV Investors Holdings"), which, in turn, directly owns 80% of
         the membership interests of MSV Investors. The remaining membership
         interests in MSV Investors are owned by other investors (the "Other
         SkyTerra Investors"), all of whom have agreed to be bound by the
         provisions hereof applicable to a Blocker Parent (as hereinafter
         defined).

     4.  Each of Motient, TMI, TMI Sub GP and SkyTerra (each, a "Blocker
         Parent" and collectively, the "Blocker Parents") hereby agree, that,
         if any of them shall propose to transfer any of its respective
         interests in Motient Sub, MVH, TMI Sub or MSV Investors (each, a
         "Subsidiary" and collectively, the "Subsidiaries") owned by such
         Blocker Parent, such transfer shall be subject to the rights and
         obligations contained in Section 8.2 of the Stockholders' Agreement
         (the provisions of which are hereby incorporated herein by reference,
         mutatis mutandis) as if such Blocker Parent were a Stockholder of
         TerreStar, as the case may be, and the interests being transferred
         were Shares of TerreStar.

     5.  Each of the Blocker Parents hereby agrees with each other Blocker
         Parent that if one or more of the Blocker Parents which own
         Subsidiaries holding, in the aggregate, a majority of the issued and
         outstanding Shares propose to Transfer or exchange (in a merger, stock
         transfer or otherwise) all of their interests in such Subsidiaries to
         an unrelated and unaffiliated third party ("Buyer"), such Blocker
         Parents shall have, with respect to each other Blocker Parent and
         their respective ownership interests in the Subsidiaries, the rights
         and obligations contained in Section 8.4 of the Stockholders'
         Agreement (the provisions of which are hereby incorporated herein by
         reference, mutatis mutandis), as if the Blocker Parents were
         Stockholders in TerreStar and the Subsidiaries being transferred were
         Shares of TerreStar (the "Blocker Parent Drag Along"). The Blocker
         Parent Drag Along shall be on the same terms as would be obtained by
         applying such Section 8.4 of the Stockholders' Agreement, except that
         the Blocker Parents and their respective Subsidiaries may be required
         to provide different representations, warranties and covenants to
         Buyer to the extent reasonably required to reflect the differences in
         the nature of the interests being transferred (i.e., a transfer of TMI
         Sub equity interests versus a transfer of Motient Sub capital stock).
         Without limiting the generality of the foregoing, the Blocker Parent
         Drag Along shall provide each of the Blocker Parents with the same
         percentage of the consideration to be received from Buyer as would be
         obtained by applying Section 8.4 of the Stockholders' Agreement (i.e.,
         as if Buyer had acquired Shares of TerreStar directly, and the
         proceeds of such acquisition were distributed by each Subsidiary to
         its respective Blocker Parent); provided, however, that if any of the
         Subsidiaries has any liabilities, then such liabilities shall be taken
         into account and reduce the consideration to be received by the owners
         of such entity. Without limiting the foregoing, each of the parties
         expressly acknowledges and agrees that the most likely method of
         structuring a sale or disposition of TerreStar's business is not by
         means of a sale of TerreStar's assets or capital stock but rather by
         means of the transfer of the ownership interests in the various
         entities that hold interests in TerreStar by sale, merger or otherwise
         and that a merger or series of mergers or similar transaction
         involving securities of the acquirer or its affiliates may be fully
         taxable to TMI and/or TMI Sub GP (and to any Other SkyTerra Investor
         who owns equity interests in MSV Investors and is organized as a
         limited partnership or limited liability company (a "LLC Investor"))
         if TMI Sub (or such LLC Investor) were treated as a partnership for
         U.S. tax purposes while being treated as a tax-free reorganization by
         others or may otherwise involve tax consequences that are different
         for, and potentially adverse to, TMI, TMI Sub GP and/or TMI Sub (and
         to any Other SkyTerra Investor who owns equity interests in a LLC
         Investor) compared to the other parties to this Agreement if TMI Sub
         (or a LLC Investor) were treated as a partnership for U.S. tax
         purposes.

     6.  Motient and Motient Sub hereby represent and warrant to TMI and
         SkyTerra that from and after the date hereof, Motient Sub (a) shall
         have no assets or liabilities other than the Shares, the units of
         limited partnership interest (the "Interests") of MSV LP, the shares
         of common stock, par value $0.01 per share (the "GP Common Stock"), of
         MSV GP and the rights and obligations under (i) that certain First
         Amended and Restated Investment Agreement, dated as of August 8, 2003,
         as amended (the "Investment Agreement"), by and among Motient, Motient
         Sub, TMI, TMI Sub, MSV Investors and certain other parties named
         therein, (ii) the Ancillary Agreements (as defined in the Investment
         Agreement), (iii) the Transaction Documents (as defined in the
         Investment Agreement), (iv) that certain Purchase Agreement, dated as
         of November 12, 2004, by and among Motient Sub, MSV GP and MSV LP, (v)
         that certain Purchase Agreement, dated as of the date hereof, by and
         among Motient Sub and TerreStar, (vi) that certain Conditional Waiver
         and Consent Agreement, dated as of the date hereof, by and among
         Motient, Motient Sub and the other parties named therein, (vii) the
         Stockholders' Agreement, and (viii) that certain Amended and Restated
         Stockholders' Agreement of MSV GP, dated as of November 12, 2004, as
         amended (the "MSV Stockholders' Agreement"), by and among the
         stockholders of MSV GP named therein, and (b) shall not engage in any
         business activities other than holding the Shares, the Interests and
         the GP Common Stock.

     7.  TMI, TMI Sub GP and TMI Sub hereby represent and warrant to Motient
         and SkyTerra that from and after the date hereof, TMI Sub (a) shall
         have no assets or liabilities other than the Shares, the Interests and
         the GP Common Stock and the rights and obligations under (i) the
         Investment Agreement, (ii) the Ancillary Agreements, (iii) the
         Transaction Documents, (iv) that certain Purchase Agreement, dated as
         of November 12, 2004, by and among TMI Sub, MSV GP and MSV LP, (v) the
         Stockholders' Agreement and (v) the MSV Stockholders' Agreement and
         (b) shall not engage in any business activities other than holding the
         Shares, the Interests and the GP Common Stock and performing its
         obligations under that certain Pledge and Guarantee Agreement, dated
         as of November 26, 2001, by and among TMI, TMI Sub and the other
         parties named therein, as amended.

     8.  SkyTerra hereby represents and warrants to Motient and TMI that from
         and after the date hereof, MSV Investors shall (a) have no assets or
         liabilities other than the Shares, the Interests and the GP Common
         Stock, the rights and obligations under the (i) Investment Agreement,
         (ii) the Ancillary Agreements, (iii) the Transaction Documents, (iv)
         the Stockholders' Agreement and (v) the MSV Stockholders' Agreement,
         and (b) not engage in any business activities other than holding the
         Shares, the Interests and the GP Common Stock.

     9.  Immediately prior to the consummation of the Second Transaction, TMI
         Sub and MSV Investors shall cause the Roll-Up Entity and each parent
         entity of such Roll-Up Entity to execute an instrument reasonably
         satisfactory to the Company accepting all of the terms and conditions
         set forth in this Agreement relating to a Subsidiary and a Blocker
         Parent, respectively; provided, however, in the event that the Roll-Up
         Entity is subject to the reporting obligations under the Securities
         Exchange Act of 1934, as amended (the "Exchange Act"), at the time of
         the consummation of the Second Transaction, neither the Roll-Up Entity
         nor the parent entities of such Roll-Up Entity shall be required to
         execute such instrument; provided, further, that in the event the
         Roll-Up Entity is comprised of a group of entities and fewer than all
         of such entities are subject to the reporting obligations under the
         Exchange Act at the time of the consummation of the Second
         Transaction, TMI Sub and MSV Investors shall cause the entities that
         are not subject to such reporting obligations and each non-reporting
         parent entity of such entity to execute an instrument reasonably
         satisfactory to the Company accepting all of the terms and conditions
         set forth in this Agreement relating to a Subsidiary and a Blocker
         Parent, respectively.

     10. This Agreement shall be governed by and construed according to the law
         of the State of New York. This Agreement may be executed in any number
         of counterparts, each of which shall be deemed an original and
         enforceable against the parties actually executing such counterpart,
         and all of which, when taken together, shall constitute one
         instrument.

     11. Upon the consolidation (by a series of mergers or otherwise) of
         TerreStar, MSV Investors, Motient Sub and TMI Sub into one corporate
         entity, this Agreement shall automatically terminate, whereupon the
         restrictions set forth herein shall be replaced by provisions
         pertaining to the ownership interests in such corporate entity that
         are substantially identical to those set forth in Sections 8.1 and 8.2
         of the Stockholders' Agreement. The parties hereto agree to execute
         such documents or agreements necessary or appropriate to accomplish
         the foregoing.

                  [Remainder of Page Intentionally Left Blank]

            [Signature Page to Parent Transfer/Drag Along Agreement]
<PAGE>

         IN WITNESS WHEREOF, the undersigned indicate their agreement to the
foregoing as of the day and year first above written.


                                          TERRESTAR NETWORKS INC.

                                          By: /s/ Wharton B. Rivers, Jr.
                                             ----------------------------------
                                             Name:  Wharton B. Rivers, Jr.
                                             Title: President and Chief
                                                    Executive Officer


                                          MOTIENT CORPORATION

                                          By: /s/ Chris Downie
                                             ----------------------------------
                                             Name:  Chris Downie
                                             Title: Executive Vice President


                                          MOTIENT VENTURES HOLDINGS INC.

                                          By: /s/ Chris Downie
                                             ----------------------------------
                                             Name:  Chris Downie
                                             Title: Executive Vice President
<PAGE>

                                          TMI COMMUNICATIONS AND COMPANY,
                                          LIMITED PARTNERSHIP


                                          By: TMI COMMUNICATIONS INC.,
                                              Its General Partner

                                          By: /s/ Larry Boisvert
                                              ---------------------------------
                                              Name:  Larry Boisvert
                                              Title: President

                                          By: /s/ Ted Ignacy
                                              ---------------------------------
                                              Name:  Ted Ignacy
                                              Title: Vice President, Finance


                                          TMI COMMUNICATIONS DELAWARE,
                                          LIMITED PARTNERSHIP

                                          By: 3924505 CANADA INC.,
                                              Its General Partner



                                          By: /s/ Richard O'Reilly
                                              ---------------------------------
                                              Name:  Richard O'Reilly
                                              Title: President

<PAGE>


                                          SKY TERRA COMMUNICATIONS, INC.

                                          By: /s/ Jeffrey Leddy
                                              ---------------------------------
                                              Name:  Jeffrey Leddy
                                              Title: Chief Executive Officer


                                          MSV INVESTORS, L.L.C.

                                          By: /s/ Jeffrey Leddy
                                              ---------------------------------
                                              Name:  Jeffrey Leddy
                                              Title: Chief Executive Officer
<PAGE>

                                                                   Exhibit 10.3

                    CONDITIONAL WAIVER AND CONSENT AGREEMENT
                    ----------------------------------------

         This Conditional Waiver and Consent Agreement (the "Agreement"), dated
as of May 11, 2005, is entered into by and among Motient Corporation, a
Delaware corporation ("Motient"), Motient Ventures Holding Inc., a Delaware
corporation ("Motient Sub" and, together with Motient, the "Motient Entities")
and each other party named on the signature pages hereto (collectively, the
"Other MSV Investors").

                                    RECITALS

         WHEREAS, certain parties to this Agreement are stockholders of Mobile
Satellite Ventures GP Inc., a Delaware corporation, the general partner
("General Partner") of Mobile Satellite Ventures LP, a Delaware limited
partnership ("MSV LP"), and limited partners of MSV LP.

         WHEREAS, certain parties to this Agreement are parties to (i) the
Amended and Restated Limited Partnership Agreement of MSV LP, dated as of
November 12, 2004, by and among General Partner and the limited partners named
therein, as amended (the "Partnership Agreement"), (ii) the Amended and
Restated Stockholders' Agreement, dated November 12, 2004, by and among the
stockholders of General Partner (the "Stockholders' Agreement"), (iii) the
First Amended and Restated Investment Agreement, dated as of August 8, 2003, by
and among MSV LP and the stockholders of the General Partner (the "Investment
Agreement"), (iv) the Voting Agreement, dated as of November 12, 2004, by and
among certain of the stockholders of the General Partner (the "Voting
Agreement"), and (v) the Second Amended and Restated Parent Transfer/Drag Along
Agreement, dated as of November 12, 2004, by and among the stockholders of the
General Partner and their related entities named therein (the "Parent
Agreement", and together with the Partnership Agreement, the Stockholders'
Agreement, the Voting Agreement and the Investment Agreement, the "JV
Agreements").

         WHEREAS, on the date hereof MSV LP will distribute all of the shares
of common stock, par value $0.001 per share, of TerreStar Networks Inc.
("TerreStar Stock"), a Delaware corporation ("TerreStar"), owned by it to its
limited partners (or their affiliates) on a pro rata basis and Motient Sub will
purchase 8,190,008 shares of TerreStar Stock for aggregate consideration of
$200,000,000.00 (the "Motient Sub Financing").

         WHEREAS, it is a condition precedent to the consummation of the
Motient Sub Financing that the MSV LP limited partners waive certain rights and
consent to such transaction (the "TerreStar Waiver and Consent") pursuant to
the TerreStar Securityholders' Agreement, dated as of December 20, 2004, by and
among TerreStar, MSV LP and certain other parties named therein (the "Existing
Securityholders' Agreement").

         WHEREAS, it is also a condition precedent to the consummation of the
Motient Sub Financing that the Existing Securityholders' Agreement be
terminated and the following agreements, among others, be entered into on the
date hereof: (i) a Stockholders' Agreement, by and among the stockholders of
TerreStar (the "New TerreStar Stockholders' Agreement"), (ii) a Third Amendment
to the Pledge and Guarantee Agreement, by and among TMI Communications
Delaware, Limited Partnership and the parties listed on Schedule 1 thereto (the
"Third Amendment," and the Pledge and Guarantee Agreement as amended by such
Third Amendment, the "New Pledge Agreement") and (iii) a Parent Transfer/Drag
Along Agreement, by and among the stockholders of TerreStar and their related
entities named therein (the "New TerreStar Parent Agreement," and, together
with the New TerreStar Stockholders' Agreement and the New Pledge Agreement,
the "New TerreStar Documents").

         WHEREAS, the Other MSV Investors intend, at some future date, that
there may occur a transaction or series of transactions involving the
consolidation of control, directly or indirectly (by transfer of ownership or
through contract), of units of limited partnership interest in MSV LP ("MSV LP
Units") and shares of common stock, par value $0.01 per share, of the General
Partner ("GP Shares"), owned by MSV Investors, L.L.C. ("MSV Investors") and TMI
Communications Delaware, Limited Partnership ("TMI Sub") (or their respective
affiliates), and which also may involve the consolidation of control (by
transfer of ownership or through contract) of (i) shares of TerreStar Stock
owned by MSV Investors and TMI Sub (or their respective affiliates) and/or (ii)
MSV LP Units, GP Shares, TerreStar Stock and/or outstanding employee options
granted under an employee option plan of MSV LP (the "MSV Options") owned or
held by any member of the Columbia/Spectrum Investor Group (and/or the Spectrum
Entities (as such term is defined in the New TerreStar Stockholders' Agreement)
if such entities cease to be members of the Columbia/Spectrum Investor Group),
the Limited Holders, the TSTR Group (or their respective affiliates) (each as
defined in the New TerreStar Stockholders' Agreement) and/or the Limited
Investors (as defined in the Stockholders' Agreement) (or their affiliates),
into the Roll-Up Entity (as defined below) (the "Second Transaction," provided,
that should any such consolidation of control occur other than by way of a
direct or indirect transfer of ownership (and all rights associated therewith)
in the shares of TerreStar Stock, or the MSV LP Units and GP Shares, the
transaction or series of transactions giving rise to such consolidation of
control shall be deemed to fall within this definition of "Second Transaction"
only if any and all rights and obligations of the Roll-Up Entity and any Other
MSV Investor party to such transaction or transactions under any of the
TerreStar Documents or the JV Agreements, as applicable, are allocated among
the Roll-Up Entity and such Other MSV Investor. For the purposes of this
Agreement, "Roll-Up Entity" shall mean a single entity or group of related
entities that will acquire direct or indirect ownership or control of any
shares of TerreStar Stock, MSV LP Units, GP Shares or MSV Options pursuant to
the Second Transaction, and any person to whom the Roll-Up Entity transfers MSV
LP Units and GP Shares pursuant to Section 8.2(c)(i) or Section 8.2(c)(ii) of
the Stockholders' Agreement, or shares of TerreStar Stock pursuant to Section
8.2(b)(ii) or Section 8.2(b)(iii) of the New TerreStar Stockholders' Agreement.

         WHEREAS, on February 9, 2005, the Motient Entities and their
affiliates acquired direct and indirect ownership of certain MSV LP Units and
GP Shares, by way of a merger of Telcom Satellite Ventures Inc. and Telcom
Satellite Ventures II, Inc. with and into a Motient Entity, and by way of the
purchase of shares of Spectrum Space Equity Investors IV, Inc., Spectrum Space
IV Parallel, Inc., Spectrum Space IV Managers, Inc., Columbia Space (QP), Inc.,
Columbia Space (AI), Inc. and Columbia Space Partners, Inc. (the "February
Transaction");

         NOW, THEREFORE, in consideration of the agreements contained herein
and for other good and valuable consideration (including, but not limited to,
the MSV LP limited partners' willingness to provide the TerreStar Waiver and
Consent with respect to the Motient Sub Financing and enter into the New
TerreStar Documents), the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree as follows:

     1. Consent.

         (a) Subject to (i) the satisfaction of the conditions set forth in
Section 3 hereof and (ii) the consummation of the Motient Sub Financing, the
Motient Entities hereby consent, on behalf of themselves, their affiliates and
on behalf of any other stockholder of the General Partner or limited partner of
MSV LP in which they or their affiliates hold an ownership interest (and on
behalf of any transferee or successor of the foregoing), to the extent of such
stock or partnership ownership interest (collectively, the "Motient Related
Parties"), for the purposes of the JV Agreements and the TerreStar Documents,
to the entry into, and consummation of, the Second Transaction. For purposes
hereof, TSTR Investors, LLC and Dr. Rajendra Singh shall not constitute Motient
Related Parties.

         (b) The Other MSV Investors hereby ratify and consent, on behalf of
themselves, their affiliates and on behalf of any other stockholder of the
General Partner or limited partner of MSV LP in which they or their affiliates
hold an ownership interest (and on behalf of any transferee or successor of the
foregoing), to the extent of such stock or partnership ownership interest
(collectively, the "Other MSV Investor Related Parties"), to the entry into,
and consummation of, the February Transaction. The Other MSV Investors hereby
waive, on behalf of the Other MSV Investors Related Parties, solely in
connection with the consummation of the February Transaction, (i) the
restriction on the ability to sell or otherwise dispose of GP Shares pursuant
to Section 7 of the Stockholders' Agreement applicable to the stockholders that
sold or otherwise disposed of their GP Shares pursuant to the February
Transaction; (ii) their rights of first refusal pursuant to Section 8.2 of the
Stockholders' Agreement (and incorporated into the Partnership Agreement
pursuant to Section 9.1 thereof and into the Parent Agreement pursuant to
Section 8 thereof), including, without limitation, their rights to notice and
their right to purchase GP Shares and MSV LP Units that were sold or otherwise
disposed of pursuant to the February Transaction; (iii) their tag-along rights
pursuant to Section 8.2 of the Stockholders' Agreement (and incorporated into
the Partnership Agreement pursuant to Section 9.1 thereof and into the Parent
Agreement pursuant to Section 8 thereof), including, without limitation, their
rights to notice and their right to require the purchase of their GP Shares and
MSV LP Units as part of the February Transaction; and (iv) covenant and agree
not to challenge or otherwise seek to limit or set aside the February
Transaction on the basis of any of the foregoing rights, restrictions or
privileges. The ratification and consent set forth in this Section 1(b) is
based on the Other MSV Investors' understanding that no Motient Entity violated
the ownership limitation set forth in Section 8.6 of the Stockholders'
Agreement in connection with the February Transaction and shall not be deemed
to be a ratification of, or consent to, any waiver of the ownership limitation
set forth in Section 8.6 of the Stockholders' Agreement in connection with the
consummation of the February Transaction. In addition, the ratification and
consent set forth in this Section 1(b) is based solely on the Other MSV
Investors' review of the Motient Transaction Agreements (as defined in the New
TerreStar Stockholders' Agreement) and on the representation that the Motient
Transaction Agreements are the only material documents and agreements related
to the February Transaction.

     2. Waiver. Subject to (a) the satisfaction of the conditions set forth in
Section 3 hereof and (b) the consummation of the Motient Sub Financing, the
Motient Entities hereby waive, on behalf of the Motient Related Parties, solely
in connection with the consummation of the Second Transaction, (i) the
restriction on the right of the stockholders (as defined in the Stockholders'
Agreement) to transfer their rights to designate the directors of the General
Partner pursuant to Section 6 of the Stockholders' Agreement; (ii) the
restriction on the stockholders' ability to sell, assign, transfer, pledge,
encumber, hypothecate, mortgage or otherwise dispose of their GP Shares
pursuant to Section 7 of the Stockholders' Agreement; (iii) their rights of
first refusal pursuant to Section 8.2 of the Stockholders' Agreement (and
incorporated into the Partnership Agreement pursuant to Section 9.1 thereof and
into the Parent Agreement pursuant to Section 8 thereof), including, without
limitation, their rights to notice and their right to purchase GP Shares and
MSV LP Units; (iv) their tag-along rights pursuant to (x) Section 8.2 of the
Stockholders' Agreement (and incorporated into the Partnership Agreement
pursuant to Section 9.1 thereof and into the Parent Agreement pursuant to
Section 8 thereof), including, without limitation, their rights to notice and
their right to require the purchase of their GP Shares and MSV LP Units and (y)
Section 8.2 of the New TerreStar Stockholders' Agreement (and incorporated into
the TerreStar Parent Agreement pursuant to Section 4 thereof), including,
without limitation, their rights to notice and their right to purchase shares
of TerreStar Stock; (v) the ownership restrictions which limit ownership of GP
Shares or MSV LP Units to 49% pursuant to Section 8.6 of the Stockholders'
Agreement (and incorporated into the Partnership Agreement pursuant to Section
9.1 thereof) and Section 2.01(c) of the Voting Agreement (as defined below),
insofar as such restrictions relate to any of the Other MSV Investors; and (vi)
any other rights or privileges pursuant to any of the JV Agreements, the
TerreStar Documents and the Motient Transaction Agreements (as defined in the
New TerreStar Stockholders' Agreement) which would otherwise prohibit, limit,
restrict or interfere with the consummation of the Second Transaction.

     3. Conditions. The consent set forth in Section 1(a) hereof and the waiver
set forth in Section 2 hereof shall remain effective subject to the
satisfaction of the following conditions upon the consummation of the Second
Transaction:

         (a) Ownership of Roll-Up Entity. Immediately following the Second
Transaction, either (i) one of the Other MSV Investors shall be the Roll-Up
Entity or (ii) all of the equity interests in the Roll-Up Entity shall be
beneficially owned by one or more of the Other MSV Investors or a Control Party
(as such term is defined in the New Stockholders' Agreement) of such Other MSV
Investor.

         (b) Consent Rights. The Stockholders' Agreement shall be amended such
that it provides the Motient Entities with the rights set forth in Section 2.01
(other than Section 2.01(c)) of the Voting Agreement, dated as of November 12,
2004 (the "Voting Agreement"), by and among certain stockholders of the General
Partner and certain limited partners of MSV LP (with such changes as are
necessary or reasonable to give effect to the Second Transaction and, so far as
the consent rights relate to drag along transactions, amended in a manner
consistent with the fair market value limitations in Section 3(c) hereof). In
addition, the Stockholders' Agreement shall be amended to provide the Motient
Entities with the right to consent (such consent not to be unreasonably
withheld) to any grant of a license of the intellectual property owned by ATC
Technologies LLC to third parties for the purpose of developing, operating,
providing, implementing, or maintaining any communications system or network
not making use of L-band spectrum or S-band spectrum; provided, that such
consent right shall terminate when the Motient Entities cease to own at least
25% of the outstanding MSV LP Units.

         (c) JV Agreements. The JV Agreements (and any related, incidental or
ancillary documents) shall be amended as may be necessary or reasonable to
provide the Motient Entities with the rights contained in such agreements that
would be customarily referred to as "minority protection" provisions which are
substantively and economically the same as the rights currently held by any of
the stockholders of General Partner and the limited partners of MSV LP under
the JV Agreements and "minority protection" provisions which are substantively
and economically the same as the rights granted under the New TerreStar
Stockholders' Agreement. Notwithstanding the foregoing, the JV Agreements shall
be amended to provide that the Motient Entities shall have the right to consent
to a drag-along transaction, other than a drag along transaction at fair market
value (as determined using a methodology that is the same as that provided in
Section 8.4(b) of the New TerreStar Stockholders' Agreement), initiated by any
party other than the Motient Entities in accordance with such JV Agreements.

         (d) Roll-Up Entity Change of Control. The JV Agreements shall be
amended such that they provide the Motient Entities with rights in the event of
a change of control of the Roll-Up Entity, other than among the stockholders of
the Roll-Up Entity immediately following the consummation of the Second
Transaction, substantially the same as those rights conferred on entities other
than Motient Entities in Section 8.5(c) of the New TerreStar Stockholders'
Agreement in respect of a change of control of Motient.

         (e) Board Representation. The JV Agreements shall be amended such that
they provide the Motient Entities with the right to designate a number of
directors to the board of directors of the General Partner that is
proportionate to its holdings in the General Partner.

     4. Covenants.

         (a) The Motient Entities hereby agree on behalf the Motient Related
Parties, not to directly or indirectly seek to increase their direct or
indirect percentage ownership or control of MSV LP or the General Partner for a
period of eighteen (18) months following the consummation of the Motient Sub
Financing, provided, however, that except with respect to the MSV LP Options
and the MSV LP Units issued upon the exercise of the MSV Options owned by the
Limited Investors, the foregoing agreement will expire upon consummation of the
Second Transaction.

         (b) The Other MSV Investors hereby agree that they will not make any
offer, directly or indirectly, to Option Holders (as defined in the New
TerreStar Stockholders' Agreement) to acquire (by way of exchange or otherwise)
any Options (as defined in the New TerreStar Stockholders' Agreement) (or the
TerreStar Stock issuable or issued upon the exercise of such Options) until
January 1, 2006. If any of the Motient Entities makes an offer during such
period to acquire the Options, the Motient Entities agree that such offer shall
be made to all Option Holders and the terms of any such offer shall include a
condition that the vesting schedule of such Options revert to the vesting
schedule in effect on the date of this Agreement (instead of being accelerated
in connection with the consummation of the Motient Sub Financing). In
structuring any such offer, the Motient Entities agree that they shall seek, to
the extent reasonably possible, to minimize tax consequences for Option
Holders, and that they shall comply with applicable securities laws.

     5. Miscellaneous.

         (a) Second Transaction. Notwithstanding anything herein to the
contrary, nothing in this Agreement shall be deemed to bind or commit any of
the Other MSV Investors (other than any Motient Related Party) to consummate
the Second Transaction and nothing herein shall constitute a waiver or consent
under any of the JV Agreements by any of the Other MSV Investors (other than
any Motient Related Party) with respect to the Second Transaction.

         (b) Term. This Agreement, and the obligations of the parties
hereunder, shall expire on such date that is 24 months following the date of
this Agreement.

         (c) Amendments. This Agreement, and the rights and obligations of the
parties hereto may be waived (either generally or in a particular instance,
either retroactively or prospectively, and either for a specified period of
time or indefinitely) or amended if and only if such waiver or amendment is
consented to in writing by the parties hereto.

         (d) Governing Law. This Agreement shall be governed in all respects by
the law of the State of New York as such law is applied to agreements between
New York residents entered into and performed entirely in the State of New
York, without regard to the conflict of laws provisions hereof.

         (e) Successors and Assigns. The provisions hereof shall be binding
upon the transferees, successors, assigns, heirs, executors and administrators
of the parties hereto.

         (f) Severability. In case any provisions of this Agreement shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby;
provided, that no such severability shall be effective if it materially and
adversely affects the economic benefit of this Agreement to any party hereto.

         (g) Notices. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given (a) upon personal delivery to the
party to be notified, (b) when sent by confirmed facsimile if sent during
normal business hours of the recipient, if not, then on the next business day,
(c) five days after having been sent by registered or certified mail, return
receipt requested, postage prepaid, or (d) one day after deposit with a
nationally recognized overnight courier, specifying next day delivery, with
written verification of receipt. All communications shall be sent to each party
at the address previously provided by such party.

         (h) Equitable Relief. Each party agrees that if it fails to perform
its obligations under this Agreement for any reason whatsoever, the other
parties hereto shall be entitled to specific performance and injunctive or
other equitable relief, and each party hereby further agrees to waive any
requirement for the securing or posting of any bond in connection with the
obtaining of any injunctive or other equitable relief. This provision is
without prejudice to any other rights that the other parties to this Agreement
may have against any other party for any failure to perform its obligations
under this Agreement.

         (i) Further Assurances. Each party shall at any time and from time to
time promptly execute and deliver to the other parties such further
instruments, consents and other documents and take such further action as such
other parties may reasonably require (including, without limitation, in the
case of the Motient Entities, causing the GP Shares held by Motient Sub to be
voted, and causing Motient Sub's designee to the board of directors of the
General Partner to vote, in favor of such stockholder or board resolutions, as
the case may be, as are necessary to give effect to or facilitate the Second
Transaction) in order to carry out the full intent and purpose of this
Agreement.

         (j) Non-circumvention. The Motient Entities agree, on behalf of the
Motient Related Parties, that they shall not, and shall not permit or encourage
any third party to, directly or indirectly, take any action or omit to take any
action where such action or omission is intended or would reasonably be
expected to result in the circumvention or avoidance by the Motient Entities of
the respective consents, waivers, covenants or the intent of this Agreement or
otherwise seek to impede or frustrate the Second Transaction.

         (k) Interpretation. The titles of the sections and subsections of this
Agreement are for convenience of reference only and are not to be considered in
construing this Agreement. All pronouns contained herein, and any variations
thereof, shall be deemed to refer to the masculine, feminine or neutral,
singular or plural, as to the identity of the parties hereto may require.

         (l) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument. Delivery of an executed counterpart of a
signature page of this Agreement by facsimile shall be effective as delivery of
a manually executed counterpart of this Agreement.

         (m) Entire Agreement. This Agreement constitutes the full and entire
understanding and agreement among the parties with regard to the subject matter
hereof and supersedes any and all prior and contemporaneous agreements or
understandings, whether expressed or implied, written or oral, between or among
the parties with respect to such subject matter. No party shall be liable or
bound to any other in any manner by any representations, warranties, covenants
and agreements except as specifically set forth herein.

             [The remainder of the page left intentionally blank.]
<PAGE>

          [Signature Page to Conditional Waiver and Consent Agreement]

         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered effective as of the date first above written.



                                      MOTIENT CORPORATION

                                      By: /s/ Chris Downie
                                          -------------------------------------
                                          Name:  Chris Downie
                                          Title: Executive Vice President


                                      MOTIENT VENTURE HOLDINGS INC.

                                      By: /s/ Chris Downie
                                          -------------------------------------
                                          Name:  Chris Downie
                                          Title: Executive Vice President


                                      TMI COMMUNICATIONS AND COMPANY, LIMITED
                                      PARTNERSHIP

                                      By: TMI COMMUNICATIONS INC.,
                                          Its General Partner

                                      By: /s/ Larry Boisvert
                                          -------------------------------------
                                          Name:  Larry Boisvert
                                          Title: President

                                      By: /s/ Ted Ignacy
                                          -------------------------------------
                                          Name:  Ted Ignacy
                                          Title: Vice President, Finance


                                      TMI COMMUNICATIONS DELAWARE, LIMITED
                                      PARTNERSHIP

                                      By: 3924505 CANADA INC., Its General
                                          Partner

                                      By: /s/ Richard O'Reilly
                                          -------------------------------------
                                          Name:  Richard O'Reilly
                                          Title: President


          [Signature Page to Conditional Waiver and Consent Agreement]
<PAGE>

                                      TSTR INVESTORS, LLC

                                      By: /s/ Rajendra Singh
                                          -------------------------------------
                                          Name: Rajendra Singh
                                          Title: President and CEO


          [Signature Page to Conditional Waiver and Consent Agreement]
<PAGE>

                                      SPECTRUM SPACE EQUITY INVESTORS IV, INC.

                                      By: /s/ Kevin J. Maroni
                                          -------------------------------------
                                          Name:  Kevin J. Maroni
                                          Title: President


                                      SPECTRUM SPACE IV PARALLEL, INC.

                                      By: /s/ Kevin J. Maroni
                                          -------------------------------------
                                          Name:  Kevin J. Maroni
                                          Title: President


                                      SPECTRUM SPACE IV MANAGERS, INC.


                                      By: /s/ Kevin J. Maroni
                                          -------------------------------------
                                          Name:  Kevin J. Maroni
                                          Title: President


          [Signature Page to Conditional Waiver and Consent Agreement]
<PAGE>

                                      COLUMBIA SPACE (QP), INC.

                                      By: /s/ Donald A. Doering
                                          -------------------------------------
                                          Name:  Donald A. Doering
                                          Title: Treasurer


                                      COLUMBIA SPACE (AI), INC.

                                      By: /s/ Donald A. Doering
                                          -------------------------------------
                                          Name:  Donald A. Doering
                                          Title: Treasurer


                                      COLUMBIA SPACE PARTNERS, INC.

                                      By: /s/ Donald A. Doering
                                          -------------------------------------
                                          Name:  Donald A. Doering
                                          Title: Treasurer


                                      SKYTERRA COMMUNICATIONS, INC.


                                      By: /s/ Jeffrey A. Leddy
                                          -------------------------------------
                                          Name:  Jeffrey A. Leddy
                                          Title: CEO and President


                                      MSV INVESTORS, L.L.C.

                                      By: /s/ Jeffrey A. Leddy
                                          -------------------------------------
                                          Name:  Jeffrey A. Leddy
                                          Title: Chief Executive Officer


          [Signature Page to Conditional Waiver and Consent Agreement]

                                                                   Exhibit 31.1

                                 CERTIFICATIONS

I, Jeffrey A. Leddy, certify that:

     1.  I have reviewed this Form 10-Q of SkyTerra Communications, Inc.;

     2.  Based on my knowledge, this report does not contain any untrue
         statement of a material fact or omit to state a material fact
         necessary to make the statements made, in light of the circumstances
         under which such statements were made, not misleading with respect to
         the period covered by this report;

     3.  Based on my knowledge, the financial statements, and other financial
         information included in this report, fairly present in all material
         respects the financial condition, results of operations and cash flows
         of the registrant as of, and for, the periods presented in this
         report;

     4.  The registrant's other certifying officer and I are responsible for
         establishing and maintaining disclosure controls and procedures (as
         defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the
         registrant and have:

         a)   designed such disclosure controls and procedures, or caused such
              disclosure controls procedures to be designed under our
              supervision, to ensure that material information relating to the
              registrant, including its consolidated subsidiaries, is made
              known to us by others within those entities, particularly during
              the period in which this report is being prepared;

         b)   evaluated the effectiveness of the registrant's disclosure
              controls and procedures and presented in this report our
              conclusions about the effectiveness of the disclosure controls
              and procedures, as of the end of the period covered by this
              report based on such evaluation; and

         c)   disclosed in this report any change in the registrant's internal
              control over financial reporting that occurred during the
              registrant's most recent fiscal quarter (the registrant's fourth
              quarter in the case of an annual report) that has materially
              affected, or is reasonably likely to materially affect, the
              registrant's internal control over financial reporting; and

     5.  The registrant's other certifying officer and I have disclosed, based
         on our most recent evaluation of internal control over financial
         reporting, to the registrant's auditors and the audit committee of
         registrant's board of directors (or persons performing the equivalent
         function):

         a)   all significant deficiencies in the design or operation of
              internal controls over financial reporting which are reasonably
              likely to adversely affect the registrant's ability to record,
              process, summarize and report financial information; and

         b)   any fraud, whether or not material, that involves management or
              other employees who have a significant role in the registrant's
              internal control over financial reporting.




         Date:  May 16, 2005           By:  /s/ JEFFREY A. LEDDY
                                          -------------------------------------
                                          Jeffrey A. Leddy
                                          Chief Executive Officer and President
                                          (Principal Executive Officer and
                                              Principal Financial Officer)
<PAGE>

                                                                 Exhibit 31.2

                                 CERTIFICATIONS

I, Craig J. Kaufmann, certify that:

     1.  I have reviewed this Form 10-Q of SkyTerra Communications, Inc.;

     2.  Based on my knowledge, this report does not contain any untrue
         statement of a material fact or omit to state a material fact
         necessary to make the statements made, in light of the circumstances
         under which such statements were made, not misleading with respect to
         the period covered by this report;

     3.  Based on my knowledge, the financial statements, and other financial
         information included in this report, fairly present in all material
         respects the financial condition, results of operations and cash flows
         of the registrant as of, and for, the periods presented in this
         report;

     4.  The registrant's other certifying officer and I are responsible for
         establishing and maintaining disclosure controls and procedures (as
         defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the
         registrant and have:

         a)   designed such disclosure controls and procedures, or caused such
              disclosure controls procedures to be designed under our
              supervision, to ensure that material information relating to the
              registrant, including its consolidated subsidiaries, is made
              known to us by others within those entities, particularly during
              the period in which this report is being prepared;

         b)   evaluated the effectiveness of the registrant's disclosure
              controls and procedures and presented in this report our
              conclusions about the effectiveness of the disclosure controls
              and procedures, as of the end of the period covered by this
              report based on such evaluation; and

         c)   disclosed in this report any change in the registrant's internal
              control over financial reporting that occurred during the
              registrant's most recent fiscal quarter (the registrant's fourth
              quarter in the case of an annual report) that has materially
              affected, or is reasonably likely to materially affect, the
              registrant's internal control over financial reporting; and

     5.  The registrant's other certifying officer and I have disclosed, based
         on our most recent evaluation of internal control over financial
         reporting, to the registrant's auditors and the audit committee of
         registrant's board of directors (or persons performing the equivalent
         function):

         a)   all significant deficiencies in the design or operation of
              internal controls over financial reporting which are reasonably
              likely to adversely affect the registrant's ability to record,
              process, summarize and report financial information; and

         b)   any fraud, whether or not material, that involves management or
              other employees who have a significant role in the registrant's
              internal control over financial reporting.



         Date:  May 16, 2005                 By:  /s/ CRAIG J. KAUFMANN
                                                 ------------------------------
                                                  Craig J. Kaufmann
                                                  Controller and Treasurer
                                                  (Principal Accounting Officer)
<PAGE>

                                                                 Exhibit 32.1


                           CERTIFICATION PURSUANT TO
                            18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                 SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

     I, Jeffrey A. Leddy, Chief Executive Officer and President of SkyTerra
Communications, Inc. (the "Company"), hereby certifies, pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of
2002, that, to my knowledge:

     (1)  The Company's Quarterly Report on Form 10-Q for the quarter ended
          March 31, 2005, as filed with the Securities and Exchange Commission
          on the date hereof (the "Report"), fully complies with the
          requirements of Section 13(a) or 15(d) of the Securities Exchange Act
          of 1934; and

     (2)  The information contained in the Report fairly presents, in all
          material respects, the financial condition and results of operations
          of the Company.


                           By:   /s/ JEFFREY A. LEDDY
                                 Name: Jeffrey A. Leddy
                                 Title: Chief Executive Officer and President
                                        (Principal Executive Officer and
                                            Principal Financial Officer)
                                 Date:   May 16, 2005


     This certification accompanies the Report pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002 and shall not be deemed filed by the Company for
purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

     A signed original of this written statement required by Section 906, or
other document authenticating, acknowledging, or otherwise adopting the
signature that appears in typed form within the electronic version of this
written statement required by Section 906, has been provided to the Company and
will be retained by the Company and furnished to the Securities and Exchange
Commission or its staff upon request.
<PAGE>

                                                                 Exhibit 32.2

                           CERTIFICATION PURSUANT TO
                            18 U.S.C. SECTION 1350,
                             AS ADOPTED PURSUANT TO
                 SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

     I, Craig J. Kaufmann, Controller and Treasurer of SkyTerra Communications,
Inc. (the "Company"), hereby certifies, pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my
knowledge:

     (1)  The Company's Quarterly Report on Form 10-Q for the quarter ended
          March 31, 2005, as filed with the Securities and Exchange Commission
          on the date hereof (the "Report"), fully complies with the
          requirements of Section 13(a) or 15(d) of the Securities Exchange Act
          of 1934; and

     (2)  The information contained in the Report fairly presents, in all
          material respects, the financial condition and results of operations
          of the Company.


                                 By:   /s/ CRAIG J. KAUFMANN
                                     -------------------------------------
                                     Name: Craig J. Kaufmann
                                     Title: Controller and Treasurer
                                             (Principal Accounting Officer)
                                     Date:  May 16, 2005


     This certification accompanies the Report pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002 and shall not be deemed filed by the Company for
purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

     A signed original of this written statement required by Section 906, or
other document authenticating, acknowledging, or otherwise adopting the
signature that appears in typed form within the electronic version of this
written statement required by Section 906, has been provided to the Company and
will be retained by the Company and furnished to the Securities and Exchange
Commission or its staff upon request.