Document:

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[LOGO]
                                                                   EXHIBIT 10.5

November 17, 2000

U.S. Interactive, Inc. Noteholder

         Re:      Binding Letter of Intent for Note Modification.
                  ----------------------------------------------

Dear Sir or Madam:

         In connection with closing under that certain Agreement and Plan of
Merger, dated February 1, 2000 (the "Merger Agreement"), by and among U.S.
Interactive, Inc. ("USIT"), First Acquisition Co. (now U.S. Interactive Corp.
(Delaware)), Soft Plus, Inc. ("Soft Plus") and each of you, USIT executed and
delivered to Mohan Uttarwar as the Soft Plus Shareholder Agent (the "Agent") its
non-negotiable, non-assignable promissory note, dated March 8, 2000, in the
original principal amount of $80 million (the "Original Note").

         We have been negotiating with the Agent to restructure the Original
Note and are prepared to enter into this Agreement to modify the Original Note
in accordance with the Term Sheet attached hereto and incorporated herein by
this reference, which Term Sheet sets forth all the material terms and
conditions for modifying the Original Note that will be included in definitive
agreements among the parties as promptly as possible following the date hereof.

         If the parties are unable to negotiate, execute and deliver such
definitive documents for some unanticipated reason, then the terms and
conditions set forth in the Term Sheet shall control and any dispute between the
parties (including any immaterial term not set forth in the Term Sheet) shall be
resolved by binding arbitration in such locale as the parties may agree, and if
the parties cannot agree, then in the City of St. Louis, MO. The arbitration
shall be pursuant to the Commercial Arbitration Rules of the American
Arbitration Association.

         No rights created by this letter agreement may be assigned and no
duties created by this letter agreement may be delegated by a party without the
prior written consent of the other party. One or more waivers of any term or
condition shall not be construed as a waiver of any subsequent breach of the
same term or condition. This letter agreement may be executed in any number of
counterparts, all of which shall be considered one and the same instrument and
shall become effective when one or more counterparts have been signed by each of
the parties and delivered to the other parties. This letter agreement shall be
subject to and shall be construed under the laws of Delaware.

         Subject to approval by the Board of Directors of USIT, intending to be
legally bound, we have executed this letter, which sets forth the material terms
and conditions to modify the Original Note, including the terms and conditions
set forth in the Term Sheet attached hereto and incorporated herein by this
reference. If you are in agreement with the foregoing terms, the terms and
conditions set forth in the Term Sheet attached hereto and incorporated herein
by this reference, then please sign this letter below where you name appears,
which will constitute our agreement with respect to the subject matter of this
letter. Thank you.

                                             U.S. INTERACTIVE, INC.

                                             By:    /s/  William C. Jennings
                                                    ----------------------------
                                                         William C. Jennings

                                             Title: Chief Executive Officer
                                                    ----------------------------

Acknowledged and agreed to,
intending to be legally bound,
this November 6, 2000.

/s/ Mohan Uttarwar
-----------------------------------
Signature

Mohan Uttarwar
-----------------------------------
Print name

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                             U.S. INTERACTIVE, INC.
                          $80,000,000 Restructured Note

                                   Term Sheet

         U.S. Interactive, Inc. (the "Company") issued a Note in the principal
amount of $80,000,000 that is scheduled to mature on March 8, 2001 (the
"Original Note"). Certain holders of the Original Note and the Company are
proposing to agree to restructure the Original Note in accordance with the basic
terms set forth herein. Reference herein the "holders of the Original Note"
shall mean former shareholders of Soft Plus with the beneficial percentage
interest in the Original Note in the percentages set forth on the schedule
attached hereto. Those holders of the Original Note who consent (the "Consenting
Holders") to the restructuring of the Original Note will each receive a new note
(the "Restructured Note") with substantially the same terms set forth herein.

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<S>                                                  <C>
1.       Term:                                       The term of the Restructured Notes shall be that the
                                                     maturity date is March 8, 2008.

2.       Principal:                                  The aggregate principal amount of the Restructured Notes
                                                     shall be equal to the sum of the proportionate interest of
                                                     the Consenting Holders in the Original Note but not less
                                                     than $72,000,000.  If a Consenting Holder converts a portion
                                                     of its Restructured Note prior to maturity as provided
                                                     below, the principal amount due to such Consenting Holder at
                                                     maturity shall be reduced accordingly.

3.       Interest:                                   The interest on the Restructured Notes shall be 6.20% per
                                                     annum.  The interest accrues but does not compound for the
                                                     term of the Restructured Notes.  Interest accrued as of the
                                                     restructured date shall remain accrued interest, and shall
                                                     be satisfied as provided below.

4.       Cash Pre-Payments:                          The Company has the option of making payments due on
                                                     interest and principal in cash at any time during the term
                                                     of the Restructured Notes; provided that any such payment
                                                     shall be made with sufficient prior notice to the Consenting
                                                     Holders so that such Consenting Holders will have adequate
                                                     opportunity to convert all or a portion of their
                                                     Restructured Notes as provided below.  Cash pre-payments
                                                     shall be applied first to accrued interest and then to
                                                     principal.

5.       No set-off for Pending Claims:              If pending litigation against the Company relating to (i)
                                                     the suit brought by former shareholders of Soft Plus, (ii)
                                                     First Albany and (iii) German tax liability is resolved or
                                                     settled resulting in any payments by the Company, such
                                                     payments shall NOT reduce the principal amount of the
                                                     Restructured Notes nor the allocable portion of the
                                                     corresponding accrued interest.

6.       Payments at Maturity:                       On March 8, 2008, the Consenting Holders shall receive that
                                                     number of fully registered shares of common stock of the
                                                     Company provided for in paragraph 7, reduced by any prior
                                                     partial conversion or as otherwise provided herein, in full
                                                     satisfaction of principal of and accrued interest on the
                                                     Restructured  Notes.
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<TABLE>
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<S>                                                  <C>
7.       Conversion Price:                           The Conversion Price upon the conversion of the Restructured
                                                     Notes shall be equal to 24,000,000 shares of common stock of
                                                     the Company multiplied by a fraction, the numerator of which
                                                     is the principal amount portion of the Restructured Note
                                                     being converted and the denominator of which is $80,000,000.

8.       Subordination:                              The Restructured Notes shall be subordinated to all present
                                                     and future Company  bank and institutional debt (whether or
                                                     not secured or designated as senior debt) as well as notes
                                                     or other payment obligations of the Company to landlords of
                                                     the Company in connection with termination or default under
                                                     the Company's current lease obligation to such landlord.

                                                     In bankruptcy, the Consenting Holders shall have a claim payable
                                                     for the full amount of principal of the Restructured Notes and
                                                     accrued interest thereon.

9.       Conversion:

     (A)            Optional Conversion by the       On the restructure date, each Consenting Holder shall
                    Consenting Holders at            have the right to convert in whole or in part such
                    Restructure Date:                Consenting Holder's pro rata share of the Restructured
                                                     Notes into shares of common stock of the Company. Any
                                                     conversion shall include the accrued interest on the principal
                                                     so converted.

     (B)            Optional Conversion by the       Beginning one year from the restructuring date, each
                    Consenting Holders after         Consenting Holder, individually, shall have the right
                    Restructure Date:                at any time and from time to time to convert all or a
                                                     portion of its pro rata share of the Restructured Notes into
                                                     shares of common stock of the Company. Any conversion shall
                                                     include the accrued interest on the principal so converted.

                                                     The Restructured Notes will contain customary provisions so
                                                     that the conversion mechanics are not administratively
                                                     burdensome on the Company.

     (C)            Optional Conversion by the       In any calendar year, the Company shall have the right
                    Company:                         to convert up to $20 million in principal amount of
                                                     the Restructured Notes
                                                     (and corresponding accrued interest thereon), pro rata among
                                                     the Consenting Holders, into fully registered shares of common
                                                     stock of the Company if the price of the Company's common stock
                                                     is at least $3.00 per share for not less than ten consecutive
                                                     trading days. Any conversion shall satisfy the accrued interest
                                                     on the principal so converted.

10.      Anti-dilution:                              The number of shares issuable upon conversion or maturity of
                                                     the Restructured Notes shall be subject to adjustment
                                                     pursuant to standard anti-dilution provisions customarily
                                                     available to holders of convertible or exchangeable
                                                     securities.  Sales of stock by the Company for more than
                                                     $3.33 per share shall not give rise to any anti-dilution
                                                     rights.
</TABLE>

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<TABLE>
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<S>                                                   <C>
11.      Board Representation:                       Until at least 51% of the aggregate principal amount of the
                                                     Restructured Notes have been converted as provided for
                                                     herein, the Directors shall agree to nominate and recommend
                                                     for appointment to the Board three (3) designees selected by
                                                     51% of then outstanding aggregate principal amount of the
                                                     Restructured Notes; provided, that Mr. Mohan Uttarwar will
                                                     be deemed one of such individuals so long as he is a
                                                     director on the Board.

                                                     The Company shall use it commercially reasonable best efforts to
                                                     secure the agreement of its principal shareholders to vote their
                                                     shares of Company common stock in favor of the designees selected
                                                     by the majority of the then outstanding aggregate principal amount
                                                     of the Restructured Notes as provided in the immediately preceding
                                                     sentence.

12.      Fees and Expenses:                          The Company shall pay the actual and reasonable fees and
                                                     expenses of the Consenting Holders in connection with the
                                                     restructuring of the Original Note, including attorneys'
                                                     fees, in an amount not exceeding $40,000.

13.      Section 453A Payments:                      On an annual basis the Company shall pay to each Consenting
                                                     Holder holding greater than $5 million principal amount of
                                                     the Restructured Note an amount equal the interest due on
                                                     the deferred tax on the gain represented by such
                                                     Restructured Note.  Other than the initial payments for 2000
                                                     under this paragraph 13, such payments will NOT be deemed to
                                                     be a pre-payment of principal of or corresponding accrued
                                                     interest on Restructured Notes.

14.      Transferability:                            Without the prior consent of the Company the Restructured
                                                     Notes shall not be transferable by a Consenting Holder other
                                                     than (a) to an "accredited investor," as such term is
                                                     defined in Rule 501(a) of Regulation D under the Securities
                                                     Act of 1933, as amended, that is not a competitor of the
                                                     Company or (b) for bona fide estate purposes to or for the
                                                     benefit the immediate family members of the Consenting
                                                     Holder.

15.      Registration of Shares:                     The Company shall register on and file with the Securities
                                                     and Exchange Commission a registration statement to register
                                                     the shares of common stock of the Company to be issued to
                                                     Consenting Holders as of the restructure date as a result of
                                                     conversion in accordance with paragraph 9(A) above.

                                                     In addition, so long as Restructured Notes are outstanding, once
                                                     each calendar year the Company shall register on and file with the
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<TABLE>
<CAPTION>

<S>                                                  <C>
                                                     Securities and Exchange Commission a registration statement to
                                                     register the shares of common stock of the Company issuable to
                                                     Consenting Holders who convert Restructured Notes in accordance
                                                     with paragraph 9(B) above on or before March 15 of each year
                                                     during the term of the Restructured Notes if, and only if,
                                                     Consenting Holders have converted shares of common stock of the
                                                     Company with a market value as of the April 1 of such year
                                                     exceeding $5.0 million.

                                                     Shares subject to the foregoing registrations are referred to
                                                     herein as "Registrable Shares." A share of common stock shall
                                                     cease to be a Registrable Share when (i) a registration statement
                                                     covering such share has been declared effective by the SEC and
                                                     such share has been disposed of by a Consenting Holder pursuant to
                                                     such effective registration statement, (ii) such share is held by
                                                     the Company or one of its subsidiaries or otherwise ceases to be
                                                     outstanding, or (iii) such share may be sold pursuant to Rule 144
                                                     of the SEC, if applicable.

                                                     In addition to the foregoing, holders of Registrable Shares shall
                                                     be entitled to "piggyback registration rights" in connection with
                                                     any firmly underwritten public offering following the first
                                                     anniversary of the restructuring date, subject to customary
                                                     underwriter "cutback" and other underwriting requirements.

16.      Conditions to Closing:                      (A) Approval by the stockholders of the Company of the
                                                     authorization of shares of common stock to be issued to the
                                                     Consenting Holders upon conversion or at maturity.

                                                     (B) The consent to the restructuring of the Original Note from the
                                                     holders of the Original Note representing at least 90% of the
                                                     principal amount of the Original Note.

                                                     (C) The registration statement registering the common stock of the
                                                     Company to be issued to the Consenting Holders upon conversion at
                                                     the restructure date shall have been declared effective by the
                                                     Securities and Exchange Commission.

                                                     (D) The Company shall have performed or complied with all
                                                     agreements or covenants required by the agreement evidencing the
                                                     Restructured Notes.

                                                     (E) The Board shall elect Mr. Mohan Uttarwar as the Chief
                                                     Executive Officer of the Company effective no later than the
                                                     restructuring date, subject to termination without cause only upon
                                                     the affirmative vote of 2/3rds of the Board of Directors then in
                                                     office.

                                                     (F) The Company receives a "fairness opinion" from Deutsche Banc
                                                     Alex. Brown.
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<TABLE>
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<S>                                               <C>

                                                     (G) Holders of registration rights with respect to outstanding
                                                     shares of common stock of the Company consent to the contemplated
                                                     stock registration hereunder.

                                                     (H) If the foregoing conditions to closing have not been satisfied
                                                     or waived by the parties prior to March 8, 2001, of if the Company
                                                     files for bankruptcy prior to such date, then the binding letter
                                                     of intent to which this Term Sheet is attached shall terminate as
                                                     of such filing or as of midnight on March 7, 2001, and shall
                                                     thereupon become null, void and of no further force and effect.

17.      Other Provisions:                           Release of the Indemnity under the Merger Agreement, the
                                                     Escrow Shares and Lock-up and Market-out Letter Agreements,
                                                     as referenced in prior discussions to the restructuring of
                                                     the Original Note.

18.      Cooperation:                                The parties agree to execute and deliver such further
                                                     documents and instruments and to do such other acts and
                                                     things as any other party, as the case may be, may
                                                     reasonably request in order to effectuate the transactions
                                                     contemplated hereby, including obtaining the consent of the
                                                     holders of the Original Note to the restructuring of the
                                                     Original Note.

</TABLE><PAGE>   1
                                                                EXECUTION COPY

              ASSIGNMENT, AMENDMENT AND RELEASE AGREEMENT

              ASSIGNMENT, AMENDMENT AND RELEASE AGREEMENT, dated as of November
17, 2000 (this "Agreement"), among the Lenders parties to the Globalstar Credit
Agreement (referred to below) (the "Assignors"), LORAL SATELLITE, INC., a
Delaware corporation (the "Assignee"), LORAL SATCOM LTD., a Bermuda company
("SatCom"), LORAL SPACE & COMMUNICATIONS LTD., a Bermuda company (the "Parent"),
LORAL SPACE & COMMUNICATIONS CORPORATION, a Delaware corporation ("LSCC" and,
together with the Assignee, SatCom and the Parent, the "Loral Entities"),
GLOBALSTAR, L.P., a Delaware limited partnership ("Globalstar") and BANK OF
AMERICA, NATIONAL ASSOCIATION ("Bank of America"), as Administrative Agent (as
defined below).

                                R E C I T A L S:
                                 ---------------

              WHEREAS, each of the Assignors is a party to the Credit Agreement,
dated as of August 5, 1999 (as amended, supplemented or otherwise modified from
time to time, the "Globalstar Credit Agreement"), among Globalstar, the
Assignors and Bank of America, as administrative agent for the Lenders (in such
capacity, the "Administrative Agent");

              WHEREAS, the obligations of Globalstar under the Globalstar Credit
Agreement are unconditionally guaranteed by the Assignee and SatCom, pursuant to
the Guarantee and Collateral Agreement, dated as of August 5, 1999 (the
"Guarantee"), made by the Assignee and SatCom in favor of Bank of America, as
collateral agent (in such capacity, the "Collateral Agent") under the Collateral
Agency Agreement, dated as of August 5, 1999 (the "Collateral Agency
Agreement"), among SatCom, the Assignee, the Parent, LSCC, the Administrative
Agent and the Collateral Agent;

              WHEREAS, each of the Assignors wishes to sell, assign and transfer
to the Assignee, and the Assignee wishes to purchase from the Assignors, subject
to the terms and conditions hereof, all of the rights, obligations and
commitments of the Assignors under the Globalstar Credit Agreement (the
"Assignment");

              WHEREAS, in connection with the Assignment, (a) all of the assets
of SatCom will be acquired by the Assignee (with SatCom to be liquidated) (the
"Reorganization"), and (b) SatCom and the Assignee will be released from their
obligations under the Guarantee as guarantors of the obligations of Globalstar
under the Globalstar Credit Agreement;

              WHEREAS, as consideration for the Assignment, the Assignee (upon
consummation of the Reorganization) will enter into a Credit Agreement, in the
form attached hereto as Exhibit A (the "New Credit Agreement"), with the
Assignors and Bank of America, as administrative agent (the "Loral Satellite
Administrative Agent") pursuant to which the Assignee will, on the Effective
Date, undertake the obligations of the borrower thereunder and, without limiting
the foregoing, to repay loans outstanding thereunder in an aggregate principal
amount of

<PAGE>   2

                                                                              2
$500,000,000 (such amount being equal to the aggregate principal amount of loans
outstanding under the Globalstar Credit Agreement) in accordance with the terms
thereof; and

              WHEREAS, as a condition to the effectiveness (in addition to the
other conditions set forth herein) of the Assignment, (a) the Parent will
guarantee the obligations of the Assignee under the New Credit Agreement, and
(b) all of the security interests created by the Loral Entities pursuant to the
Security Documents, to secure their obligations in respect of the Globalstar
Credit Agreement, shall be amended to secure their obligations in respect of the
New Credit Agreement;

              NOW, THEREFORE, in consideration of the mutual covenants and
agreements contained herein and for other good and valuable consideration, the
receipt of which is hereby acknowledged, each Assignor and the Assignee agree as
follows:

              1. Defined Terms. Unless otherwise defined in this Agreement,
terms defined in the Globalstar Credit Agreement and used herein (and in
the recitals hereto) shall have the meanings given to them in the Globalstar
Credit Agreement.

              2. Assignment of Credit Facilities.

                     (a) Each Assignor hereby irrevocably sells and assigns to
the Assignee, without recourse to such Assignor, and the Assignee hereby
irrevocably purchases and assumes from each Assignor without recourse to such
Assignor (except for breach by such Assignor of the representation and warranty
set forth in this Section 2(a)), as of the Effective Date, all of such
Assignor's rights and obligations under the Globalstar Credit Agreement with
respect to the credit facilities contained in the Globalstar Credit Agreement
(individually, an "Assigned Facility"; collectively, the "Assigned Facilities").
Each Assignor hereby represents and warrants (the "Assignor Representation and
Warranty") to the Assignee that the Assignor owns its interest in such Assigned
Facility free and clear of all liens and participations (except to the extent
the same are released on the Effective Date). Globalstar hereby acknowledges
that the amounts outstanding under each Assigned Facility are as set forth on
Schedule I hereto.

                     (b) Pursuant to subsection 9.6(c) of the Globalstar Credit
Agreement, each of Globalstar and the Administrative Agent hereby approves and
accepts the Assignment under this Agreement, effective as of the Effective Date.

                     (c) From and after the Effective Date, the Administrative
Agent shall make all payments in respect of the Assigned Facilities (including
payments of principal, interest and fees, including any accruing as of the date
hereof) to the Assignee.

                     (d) From and after the Effective Date, (i) the Assignee
shall be a party to the Globalstar Credit Agreement and shall have the rights
and obligations of a Lender thereunder and under the other Loan Documents and
shall be bound by the provisions thereof and (ii) the Assignors shall relinquish
their rights (other than rights which would survive the termination of the
Globalstar Credit Agreement) and shall be released from their obligations under
the Globalstar Credit Agreement. Without limiting the foregoing, each of the
Loral Entities hereby

<PAGE>   3

                                                                              3

irrevocably and forever releases and discharges each Assignor from any and all
of its obligations, liabilities, duties and damages arising out of this
Agreement and the Globalstar Credit Agreement, except for a breach by such
Assignor of the Assignor Representation and Warranty. Notwithstanding the
foregoing, Bank of America agrees that it will continue to act as Administrative
Agent under and in accordance with the terms of the Globalstar Credit Agreement
as of the Effective Date.

              3. Release; Reorganization. (a) Each of SatCom and the Assignee is
hereby released from all of their obligations and liabilities under the
Guarantee and the other Loan Documents as guarantors of the obligations of
Globalstar under the Globalstar Credit Agreement, and each party hereto hereby
acknowledges and agrees that the security interests created by the Loral
Entities pursuant to the Security Documents are to be amended to secure their
obligations in respect of the New Credit Agreement.

                     (b) Each of the parties hereto hereby consents to the
consummation of the Reorganization.

              4. Acknowledgments. The Assignee confirms and agrees with the
Assignors and the Administrative Agent as follows:

                     (a) Each Assignor makes no representation or warranty and
assumes no responsibility with respect to (i) any statements, warranties or
representations made in or in connection with the Globalstar Credit Agreement or
with respect to the execution, legality, validity, enforceability, genuineness,
sufficiency or value of the Globalstar Credit Agreement, any other Loan Document
or any other instrument or document furnished pursuant thereto, other than the
Assignor Representation and Warranty and (ii) the financial condition of the
Loan Parties or the performance or observance by the Loan Parties of any of
their respective obligations under the Globalstar Credit Agreement or any other
Loan Document or any other instrument or document furnished pursuant hereto or
thereto.

                     (b) Each Assignor attaches any Notes held by it evidencing
the Assigned Facilities and requests that the Administrative Agent, upon request
by the Assignee, exchange the attached Notes for a new Note or Notes payable to
the Assignee, in each case in amounts which reflect the Assignment being made
hereby.

                     (c) The Assignee has received a copy of the Globalstar
Credit Agreement, together with copies of the financial statements delivered
pursuant to subsection 3.1 thereof and such other documents and information as
it has deemed appropriate to make its own credit analysis and decision to enter
into this Agreement.

                     (d) The Assignee agrees that it will, independently and
without reliance upon the Assignors or the Administrative Agent and based on
such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
the Globalstar Credit Agreement, the other Loan Documents or any other
instrument or document furnished pursuant hereto or thereto.

<PAGE>   4

                                                                              4

                     (e) The Assignee appoints and authorizes the Administrative
Agent to take such action as agent on its behalf and to exercise such powers and
discretion under the Globalstar Credit Agreement, the other Loan Documents or
any other instrument or document furnished pursuant hereto or thereto as are
delegated to the Administrative Agent by the terms thereof, together with such
powers as are incidental thereto.

                     (f) The Assignee agrees that it will be bound by the
provisions of the Globalstar Credit Agreement and will perform in accordance
with its terms all the obligations which by the terms of the Globalstar Credit
Agreement are required to be performed by it as a Lender including, if it is
organized under the laws of a jurisdiction outside the United States, its
obligation pursuant to subsection 2.19(b) of the Globalstar Credit Agreement.

              5. Representations and Warranties of the Loral Entities. Each
Loral Entity hereby represents and warrants to each Assignor and to the
Administrative Agent as follows:

                     (a) Corporate Existence; Compliance with Law. Such Loral
Entity (i) is duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation or organization, (ii) has the
corporate power and authority and the legal right to own and operate its
property, to lease the property it operates as lessee and to conduct the
business in which it is currently engaged, (iii) is duly qualified as a foreign
corporation and in good standing under the laws of each jurisdiction where its
ownership, lease or operation of property or the conduct of its business
requires such qualification, except to the extent that the failure to be so
qualified could not, in the aggregate, reasonably be expected to have a Material
Adverse Effect (as defined in the New Credit Agreement), and (iv) is in
compliance with all Requirements of Law except to the extent that the failure to
comply therewith could not, in the aggregate, reasonably be expected to have a
Material Adverse Effect (as defined in the New Credit Agreement).

                     (b) Corporate Power; Authorization; Enforceable
Obligations. Such Loral Entity has the power and authority and the legal right
to make, deliver and perform this Agreement and has taken all necessary
corporate action to authorize the execution, delivery and performance of this
Agreement. No consent or authorization of, filing with or other act by or in
respect of any Governmental Authority is required in connection with the
execution, delivery, performance, validity or enforceability of this Agreement,
other than those which have been obtained or made and are in full force and
effect. This Agreement has been duly executed and delivered by such Loral
Entity. This Agreement constitutes a legal, valid and binding obligation of such
Loral Entity enforceable against such Loral Entity in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors' rights generally and by general equitable principles (whether
enforcement is sought by proceedings in equity or at law).

                     (c) No Legal Bar. The execution, delivery and performance
of this Agreement will not violate any Requirement of Law or any Contractual
Obligation applicable to such Loral Entity.

<PAGE>   5

                                                                              5

                     (d) Satellite Orbit. Telstar 6 and Telstar 7 were placed
into and continue to be in proper geosynchronous orbit at 93(0) West Longitude
and 129(0) West Longitude, respectively, and no Constructive Failure (as defined
in the New Credit Agreement) or Partial Failure (as defined in the New Credit
Agreement) in respect of Telstar 6 or Telstar 7 has occurred.

              6. Conditions to Effectiveness. The effectiveness of this
Agreement is subject to the satisfaction of each of the following conditions
(the date on which such conditions are first satisfied, the "Effective Date"),
and the Administrative Agent is authorized to confirm conclusively the
occurrence of the Effective Date on behalf of the parties hereto:

                     (a) Execution of this Agreement. The Administrative Agent
shall have received counterparts of this Agreement duly executed and delivered
by each Loral Entity, each Assignor, Globalstar and the Administrative Agent.

                     (b) Representations and Warranties. Each of the
representations and warranties made by the Loral Entities in or pursuant to this
Agreement and the New Credit Agreement and the other Loan Documents (as defined
in the New Credit Agreement) shall be true and correct on and as of the
Effective Date as if made on and as of such date.

                     (c) Reorganization. The Reorganization shall have been
consummated in accordance with applicable law and on terms and conditions
reasonably satisfactory to the Loral Satellite Administrative Agent, and all
approvals and consents required in connection therewith shall have been obtained
on reasonably satisfactory terms and conditions and shall be in full force and
effect.

                     (d) New Credit Agreement. The Loral Satellite
Administrative Agent shall have received counterparts of the New Credit
Agreement duly executed and delivered by the Assignee, the Assignors and the
Loral Satellite Administrative Agent.

                     (e) New Credit Agreement Loan Documents. The Loral
Satellite Administrative Agent shall have received (i) counterparts of the
Guarantee, substantially in the form of Exhibit E to the New Credit Agreement
duly executed and delivered by the Parent, (ii) counterparts of the Amended and
Restated Collateral Agency Agreement, substantially in the form of Exhibit G to
the New Credit Agreement and amending and restating the Collateral Agency
Agreement entered into in connection with the Globalstar Credit Agreement, duly
executed and delivered by each of the parties thereto, (iii) counterparts of the
Amended and Restated Pledge Agreement, substantially in the form of Exhibit I to
the New Credit Agreement and amending and restating the LSCC Pledge Agreement,
duly executed and delivered by LSCC, (iv) counterparts of the Cash Collateral
Agreement, substantially in the form of Exhibit J to the New Credit Agreement,
duly executed and delivered by the Assignee, (v) counterparts of the Collateral
Agreement, substantially in the form of Exhibit O to the New Credit Agreement,
duly executed and delivered by the Assignee, (vi) for the account of each Term
Lender (as defined in the New Credit Agreement) under the New Credit Agreement
requesting the same, a Term Note (as defined in the New Credit Agreement)
conforming to the requirements of the New Credit Agreement and executed by a
duly authorized officer of the Assignee, (vii) for the account of

<PAGE>   6

                                                                              6

each Revolving Lender (as defined in the New Credit Agreement) requesting the
same, a Revolving Note (as defined in the New Agreement) conforming to the
requirements of the New Credit Agreement and executed by a duly authorized
officer of the Assignee, (viii) counterparts of the Amended and Restated Master
Lease Agreement, substantially in the form of Exhibit K to the New Credit
Agreement, duly executed and delivered by each of the parties thereto, (ix)
counterparts of the Amended and Restated Availability Agreement, substantially
in the form of Exhibit L to the New Credit Agreement, duly executed and
delivered by each of the parties thereto and (x) counterparts of the Amended and
Restated TT&C Agreement substantially in the form of Exhibit N to the New Credit
Agreement, duly executed and delivered by each of the parties thereto.

                     (f) Termination Agreement. The Loral Satellite
Administrative Agent shall have received counterparts of the Amended and
Restated Termination Agreement, substantially in the form of Exhibit B hereto,
duly executed and delivered by each of the parties thereto.

                     (g) Payments of Certain Amounts. All accrued interest, fees
and other amounts owing under the Globalstar Credit Agreement (including,
without limitation, amounts payable under subsection 2.20 thereof) shall have
been paid in full to the Administrative Agent for the account of the Assignors.
Notwithstanding the foregoing, the Administrative Agent shall have received from
the Assignee for the benefit of the Assignors an amount equal to all accrued
interest on the Loans outstanding under the Globalstar Credit Agreement and all
accrued Commitment Fees under subsection 2.8 of the Globalstar Credit Agreement.

                     (h) Legal Opinions. The Loral Satellite Administrative
Agent shall have received, with a photocopy counterpart for each Assignor, (i)
an opinion of Willkie Farr & Gallagher, counsel to the Loral Entities and
Globalstar, dated the Effective Date and addressed to the Administrative Agent,
the Loral Satellite Administrative Agent, the Collateral Agent and the
Assignors, substantially in the form of Exhibit B-1 to the New Credit Agreement,
(ii) an opinion of Avi Katz, Esq, Vice President of the Parent and the Assignee,
dated the Effective Date and addressed to the Administrative Agent, the
Collateral Agent and the Assignors, substantially in the form of Exhibit B-2 to
the New Credit Agreement, and given on the express instructions of the Parent,
(iii) an opinion of Appleby, Spurling & Kempe, special Bermuda counsel to the
Parent, dated the Effective Date and addressed to the Administrative Agent, the
Collateral Agent and the Assignors, substantially in the form of Exhibit B-3 to
the New Credit Agreement, and (iv) an opinion of Drinker Biddle & Reath L.L.P,
special Pennsylvania counsel to the Parent, dated the Effective Date and
addressed to the Administrative Agent, the Collateral Agent and the Assignors,
substantially in the form of Exhibit B-4 to the New Credit Agreement.

                     (i) Closing Certificate. The Loral Satellite Administrative
Agent shall have received, with a photocopy counterpart for each Assignor, a
Closing Certificate of Globalstar and each Loral Entity, dated the Effective
Date, substantially in the form of Exhibit C-1 to the New Credit Agreement with
respect to the Assignee, in the form of Exhibit C hereto with respect to
Globalstar and in the form of Exhibit C-2 to the New Credit Agreement with
respect to the other Loral Entities thereto, with appropriate insertions and
attachments,

<PAGE>   7

                                                                              7

reasonably satisfactory in form and substance to the Administrative Agent and
its counsel, executed by a Responsible Officer of such Loan Party (as defined in
the New Credit Agreement).

                     (j) Audited Financial Statements of the Assignee. The Loral
Satellite Administrative Agent shall have received the audited financial
statements described in subsection 3.1(i) of the New Credit Agreement, which
financial statements shall have been reported on without a "going concern" or
like qualification or exception, or qualification arising out of the scope of
the audit.

                     (k) Unaudited Financial Statements. The Loral Satellite
Administrative Agent shall have received the unaudited consolidated financial
statements of the Assignee and its Subsidiaries described in subsection 3.1(ii)
of the New Credit Agreement, which financial statements shall have been prepared
in accordance with GAAP (except for the absence of notes).

                     (l) Lien Searches. The Loral Satellite Administrative Agent
shall have received the results of a recent lien search in each of the
jurisdictions and offices where assets of the Assignee and its Subsidiaries are
located or recorded and such searches shall reveal no Liens on any of the assets
of the Assignee or its Subsidiaries except for Liens permitted under subsection
6.3 of the New Credit Agreement.

                     (m) Fees. The Loral Satellite Administrative Agent and the
Assignors shall have received all fees and expenses required to be paid on or
before the Effective Date. Without limiting the foregoing, the Assignee shall
pay to each Assignor (unless waived by such Assignor) an amendment fee on the
Effective Date in an amount equal to 0.25% of the aggregate amount of its
outstanding Term Loans and Revolving Commitments under the Globalstar Credit
Agreement.

                     (n) No Default. No Default or Event of Default under the
New Credit Agreement shall have occurred and be continuing on the Effective Date
or after giving effect to the transaction consummated on such day.

                     (o) No Proceeding or Litigation; No Injunctive Relief. No
action, suit or proceeding before any arbitrator or any Governmental Authority
shall have been commenced, no investigation by any Governmental Authority shall
have been commenced, no action, suit, proceeding or investigation by any
Governmental Authority shall have been threatened and no Requirement of Law
shall have been enacted or proposed, in each case as of the Effective Date (i)
seeking to restrain, prevent or change the transactions contemplated by the New
Credit Agreement in whole or in part or questioning the validity or legality of
the transactions contemplated by this Agreement or the New Credit Agreement or
seeking damages in connection with such transactions or (ii) which could
reasonably be expected to have a Material Adverse Effect (as defined in the New
Credit Agreement).

                     (p) Consents, Licenses, Approvals, etc. The Loral Satellite
Administrative Agent shall have received true copies (certified to be such by a
Responsible Officer of the Assignee or other appropriate Person) of all
governmental consents, licenses and approvals required as of the Effective Date
in accordance with applicable law in connection with

<PAGE>   8

                                                                              8

the execution, delivery, performance, validity and enforceability of this
Agreement or the New Credit Agreement and the other Loan Documents (as defined
in the New Credit Agreement) thereto and the borrowings contemplated thereunder.

                     (q) Additional Documents. The Loral Satellite
Administrative Agent shall have received each additional document, instrument,
legal opinion or item of information reasonably requested by it on or prior to
the Effective Date, including, without limitation, a copy of any debt
instrument, security agreement or other material contract to which any Loan
Party (as defined in the New Credit Agreement) or any Subsidiaries of the
Assignee may then be a party.

                     (r) Additional Matters. All corporate and other proceedings
and all documents, instruments and other legal matters in connection with the
transactions contemplated by the New Credit Agreement shall be reasonably
satisfactory in form and substance to the Loral Satellite Administrative Agent
and the Majority Lenders (as defined in the New Credit Agreement) as of the
Effective Date, and the Loral Satellite Administrative Agent shall have received
such other documents and legal opinions in respect of any aspect or consequence
of the transactions contemplated hereby or thereby as it shall reasonably
request on or prior to the Effective Date.

              7. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.

              8. Counterparts. This Agreement may be executed by one or more of
the parties to this Agreement on any number of separate counterparts, and all of
said counterparts taken together shall be deemed to constitute one and the same
instrument. Delivery of an executed signature page of this Agreement by
facsimile transmission shall be effective as delivery of a manually executed
counterpart hereof.

              9. Amendments. This Agreement may not be amended except by an
instrument in writing executed by all of the parties hereto.

              10. Integration. This Agreement represents the agreement of the
parties with respect to the subject matter hereof and there are no promises,
undertakings, representations or warranties by any party hereto relative to the
subject matter hereof not expressly set forth or referred to herein or in the
Loan Documents (as defined in the New Credit Agreement).

<PAGE>   9

                                                                              9

              11. WAIVERS OF JURY TRIAL. EACH PARTY HERETO HEREBY IRREVOCABLY
AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION
OR PROCEEDING RELATING TO THIS AGREEMENT OR FOR ANY COUNTERCLAIM THEREIN.

              12. Consent. Each of the Assignee and SatCom hereby consents to
the execution and delivery of the agreements described in Sections 6(e) and 6(f)
hereof.

              13. Submission to Jurisdiction. Each of the Assignee and Satcom
hereby irrevocably and unconditionally:

                     (a) submits for itself and its property in any legal action
or proceeding relating to the Asset Purchase Agreement, dated as of November 17,
2000 between the Assignee and SatCom (the "Asset Purchase Agreement"), and the
Bill of Sale, dated as of November 17, 2000 (the "Bill of Sale", together with
the Asset Purchase Agreement, the "Reorganization Documents") delivered pursuant
to the Asset Purchase Agreement, or for recognition and enforcement of any
judgment in respect thereof, to the non-exclusive general jurisdiction of the
Courts of the State of New York, the courts of the United States of America for
the Southern District of New York, and appellate courts from any thereof;

                     (b) consents that any such action or proceeding may be
brought in such courts and waives any objection that it may now or hereafter
have to the venue of any such action or proceeding in any such court or that
such action or proceeding was brought in an inconvenient court and agrees not to
plead or claim the same;

                     (c) agrees that service of process in any such action or
proceeding may be effected by mailing a copy thereof by registered or certified
mail (or any substantially similar form of mail), postage prepaid, to such party
at its address at c/o Loral SpaceCom Corporation, 600 Third Avenue, New York,
New York 10016;

                     (d) agrees that nothing herein shall affect the right to
effect service of process in any other manner permitted by law or shall limit
the right to sue in any other jurisdiction; and

                     (e) waives, to the maximum extent not prohibited by law,
any right it may have to claim or recover in any legal action or proceeding
referred to in this subsection any special, exemplary, punitive or consequential
damages.

              14. Effective Date. The Administrative Agent hereby confirms that
the Effective Date occurred on November 17, 2000.

<PAGE>   10

              IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed as of the date first above written by their respective duly
authorized officers.

                                       LORAL SATELLITE, INC.

                                       By: /s/ Janet T. Yeung
                                           -----------------------------
                                           Name:  Janet T. Yeung
                                           Title: Vice President and
                                                  Assistant Secretary

                                       LORAL SATCOM LTD.

                                       By: /s/ Janet T. Yeung
                                           -----------------------------
                                           Name:  Janet T. Yeung
                                           Title: Vice President and
                                                  Assistant Secretary

                                       LORAL SPACE & COMMUNICATIONS
                                        LTD.

                                       By: /s/ Janet T. Yeung
                                           -----------------------------
                                           Name:  Janet T. Yeung
                                           Title: Vice President and
                                                  Assistant Secretary

                                       LORAL SPACE & COMMUNICATIONS
                                       CORPORATION

                                       By: /s/ Janet T. Yeung
                                           -----------------------------
                                           Name:  Janet T. Yeung
                                           Title: Vice President and
                                                  Assistant Secretary

<PAGE>   11

                                       GLOBALSTAR, L.P.

                                       By: LORAL/QUALCOMM SATELLITE
                                       SERVICES, L.P., as Managing General
                                       Partner

                                       By: LORAL/QUALCOMM
                                       PARTNERSHIP, L.P., as General Partner

                                       By: LORAL GENERAL PARTNER, INC.,
                                       as General Partner

                                       By: /s/ Avi Katz
                                           ------------------------------------
                                           Name:   Avi Katz
                                           Title:  Vice President and Secretary

                                       BANK OF AMERICA, NATIONAL
                                        ASSOCIATION, as Administrative Agent
                                       and as an Assignee

                                       By: /s/ Steve Aronowitz
                                           -----------------------------
                                           Name:  Steve Aronowitz
                                           Title: Managing Director

<PAGE>   12

                                       AMERICAN MONEY MANAGEMENT CORP.,
                                       as a Lender

                                       By:  /s/ David Meyer
                                            -----------------------------
                                            Name:  David Meyer
                                            Title: Vice President

<PAGE>   13

                                       CREDIT LYONNAIS NEW YORK
                                       BRANCH, as a Lender

                                       By:  /s/ Patrick McCarthy
                                            -----------------------------
                                            Name: Patrick McCarthy

<PAGE>   14

                                       NATIONAL WESTMINSTER BANK PLC,
                                       as a Lender

                                       By:  /s/ Harry Paschalidis
                                            -------------------------------
                                            Name:  Harry Paschalidis
                                            Title: Assistant Vice President

<PAGE>   15

                                       PACIFICA PARTNERS I, L.P., as a Lender

                                       By:   Imperial Credit Asset Management
                                             As its Investment Manager

                                       By:  /s/ Dean Kawai
                                            -----------------------------
                                            Name: Dean Kawai
                                            Title: Vice President

<PAGE>   16

                                       SOCIETE GENERALE S.A., as a Lender

                                       By:  /s/ Xavier Saudreau
                                            -----------------------------
                                            Name: Xavier Saudreau
                                            Title: Vice President

<PAGE>   17

                                       SYNDICATED LOAN FUNDING TRUST, as a
                                       Lender

                                       By:  Lehman Commercial Paper Inc.,
                                              Not in its individual capacity but
                                              solely as Asset Manager

                                       By:  /s/ G. Andrews Keys
                                            -----------------------------
                                            Name: G. Andrews Keys

<PAGE>   18

                                       TRANSAMERICA EQUIPMENT FINANCIAL
                                       SERVICES CORPORATION, as a Lender

                                       By:  /s/ Shawn McAlister
                                            -----------------------------
                                            Name: Shawn McAlister
                                            Title: V.P., Region Credit Manager

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