Document:

<PAGE>   1
                                CREDIT AGREEMENT

                                  BY AND AMONG

                                GLOBALSTAR, L.P.,

                                  AS BORROWER,

                              QUALCOMM INCORPORATED

                       AND THE OTHER LENDERS NAMED HEREIN

                                       AND

                             QUALCOMM INCORPORATED,

                                    AS AGENT
<PAGE>   2
                                CREDIT AGREEMENT

         THIS CREDIT AGREEMENT (this "Agreement") is entered into as of May 5,
2000, by and among GLOBALSTAR, L.P., a limited partnership duly organized under
the laws of the State of Delaware ("Borrower"), QUALCOMM INCORPORATED, a
corporation duly organized under the laws of the State of Delaware ("QUALCOMM"),
as a Lender and as a Vendor (as defined below), any Affiliate (as defined below)
of QUALCOMM, or such other Persons as shall from time to time become Lenders
hereunder (collectively, with QUALCOMM, "Lenders"), and QUALCOMM, as Agent.

                                    RECITALS

         A. Globalstar was formed to develop and deploy the Globalstar System, a
system designed to provide satellite based wireless telecommunications services
worldwide (the "Globalstar System"). Borrower and QUALCOMM entered into the
Development Agreement (defined below), pursuant to which QUALCOMM agreed,
subject to the terms and conditions of the Development Agreement, to render
services to Borrower to design, develop, test, deliver and maintain the Ground
Communication Segment (as defined in the Development Agreement) of the
Globalstar System, and to render certain other services for use in connection
with the Globalstar System.

         B. Borrower became indebted to QUALCOMM for certain deferred payment
obligations (the "Original Development Financing Obligations") related to the
Globalstar System pursuant to the Letter Agreement (defined below). In addition,
Borrower is indebted to QUALCOMM for Costs (defined below) and other costs, fees
and expenses incurred by Borrower pursuant to the Development Agreement
(collectively, the "Additional Development Financing Obligations"), and may from
time to time hereafter become indebted for further Additional Development
Financing Obligations.

         C. Borrower desires, and Lenders have agreed, to make available certain
credit facilities to refinance the Original Development Financing Obligations
and the existing Additional Development Financing Obligations and to finance
future Additional Development Financing Obligations, but only upon the terms and
conditions and in reliance upon the representations and warranties herein set
forth.

                                    AGREEMENT

         NOW, THEREFORE, in consideration of the mutual covenants and
undertakings set forth herein, and intending to be legally bound, Borrower and
Lenders agree as follows:

SECTION 1. DEFINITIONS.

         1.1 DEFINED TERMS. As used in this Agreement, the following terms have
the respective meanings specified below or specified in the provision referenced
following such term:

                                       2.
<PAGE>   3
                  "Additional Buildout Indebtedness" means Indebtedness
(including senior and subordinated debt securities and bank financing) of
Borrower or any Wholly Owned Subsidiary incurred, or issued to finance the
buildout of the Satellite Project and related costs which either (i) constitute
the Gateway/Handset Vendor Financing, the Globalstar Bank Agreement or the
Replacement Globalstar Bank Agreement or (ii) satisfy the following criteria:
(a) none of such Indebtedness will mature (by scheduled payment or mandatory
payment or prepayment) prior to the later of (1) the last day of the Tranche B
Commitment Period and (2) the Final Maturity Date; and (b) such Indebtedness
bears interest at no higher than a market rate of interest.

                  "Additional Development Financing Obligations" has the meaning
specified in the Recitals hereto.

                  "Affiliate" means, with respect to any Person, each other
Person which, directly or indirectly, controls, is controlled by or is under
common control with such Person (excluding any trustee under, or any committee
with responsibility for administering, any pension plan or employee benefit
plan); provided, however, that for purposes of this Agreement, neither QUALCOMM
and its Affiliates nor Borrower and its Affiliates shall be deemed to be
Affiliates of one another. A Person shall be deemed to be "controlled by"
another Person if such other Person possesses, directly or indirectly, power (i)
to vote ten percent (10.0%) or more of the securities (on a fully diluted basis)
having ordinary voting power for the election of directors, managing general
partners or managing members or (ii) to direct or cause the direction of the
management and policies of such Person, whether by contract or otherwise.

                  "Agent" means QUALCOMM, not when acting in its individual
capacity, but solely when acting in its capacity as Agent under this Agreement
or any of the other Credit Documents, and any successor Agent.

                  "Agent's Payment Office" means the address for payments set
forth on the signature page hereto in relation to Agent or such other address as
Agent may from time to time specify to Borrower in writing.

                  "Aggregate Commitment" means, at any time, an amount equal to
the Aggregate Tranche A Commitment plus the Aggregate Tranche B Commitment.

                  "Aggregate Tranche A Commitment" means, at any time, an amount
equal to the amount set forth on Schedule 1.1 hereto, plus accrued but unpaid
interest thereon from the date hereof to the extent provided herein.

                  "Aggregate Tranche B Commitment" means, at any time, an amount
equal to the amount set forth on Schedule 1.1 hereto, plus accrued but unpaid
interest from the date hereof to the extent provided herein.

                  "Agreement" means this Credit Agreement, and all exhibits and
schedules to this Credit Agreement, as the same may from time to time be
amended, restated, supplemented or otherwise modified as hereinafter provided.

                                       3.
<PAGE>   4
                  "Amendment to Exchange and Registration Rights Agreement"
means that Amendment, dated as of the date hereof, to the Exchange and
Registration Rights Agreement among Borrower, GTL, QUALCOMM, Loral, LSC and
LSCC.

                  "Borrower" has the meaning specified in the Preamble hereto.

                  "Business Day" means any day other than a Saturday, Sunday, or
other day on which commercial banks in San Diego, California or New York, New
York are authorized or required to close under the laws of the State of
California, the laws of the State of New York or the laws of the United States
of America.

                  "Cash Equivalents" means (i) securities issued or directly and
fully guaranteed or insured by the United States Government or any agency or
instrumentality thereof having maturities of not more than twelve months from
the date of acquisition, (ii) time deposits and certificates of deposit of any
Lender or any domestic commercial bank having capital and surplus in excess of
$500,000,000 the holding company of which has a commercial paper rating meeting
the requirements specified in clause (iv) below having maturities of not more
than twelve months from the date of acquisition, (iii) repurchase obligations
with a term of not more than seven days for underlying securities of the types
described in clauses (i) and (ii) entered into with any Lender or bank meeting
the qualifications specified in clause (ii) above, (iv) commercial paper rated
at least A-1 or the equivalent thereof by Standard & Poor's, a division of The
McGraw-Hill Companies, Inc. ("S&P") or P-1 or the equivalent thereof by Moody's
Investors Service, Inc. ("Moody's") and in either case maturing within twelve
months after the date of acquisition, (y) tax exempt obligations rated at least
A2 or the equivalent thereof by Moody's and A or the equivalent thereof by S&P,
(vi) money market mutual funds, (vii) commercial paper (other than commercial
paper referred to in the preceding clause (iv)) rated at least A-2 or the
equivalent thereof by S&P or P-2 or the equivalent thereof by Moody's in an
aggregate principal amount not in excess of 25% of the liquid assets of Borrower
and its consolidated Subsidiaries and in either case maturing within twelve
months after the date of acquisition, (viii) money market funds at least 95% of
the assets of which constitute Cash Equivalents of the kinds described in (i)
through (vii) above, and (ix) the Merrill Lynch Asset Institutional II Fund and
other funds with substantially similar investment policies as in effect on the
date hereof.

                  "Change of Control" means (a) the sale, lease or transfer, in
one transaction or a series of related transactions, of all or substantially all
of the assets of Borrower and its Subsidiaries; (b) the adoption of a plan
relating to the liquidation or dissolution of Borrower or one or more
Subsidiaries which in the aggregate represent more than 50% of the total assets
of Borrower and its Subsidiaries, other than as permitted under subsection 6.5
of the Globalstar Bank Agreement; (c) the failure of Loral to own, directly or
indirectly, at least 70% of the Equity Interests in Borrower that it owned,
directly or indirectly, as of the Closing Date free and clear of Liens and other
Encumbrances; or (d) the first day on which Loral fails to be, or, directly or
indirectly, fails solely to control, the sole managing general partner of
Borrower.

                  "Closing" means such time as each and every condition set
forth in SECTION 3.1 hereof has been satisfied or waived by each Lender.

                                       4.
<PAGE>   5
                  "Closing Date" means the date on which the Closing occurs.

                  "Code" means the Internal Revenue Code of 1986, as amended,
and the Treasury Regulations adopted thereunder.

                  "Commitment Termination Date" means December 31, 2000.

                  "Consolidated Net Income" means, for any period, the
consolidated net income (or deficit) of Borrower and its Subsidiaries for such
period (taken as a cumulative whole), determined in accordance with GAAP.

                  "Consolidated Net Worth" means, at a particular time, all
amounts which would be included under partners' equity on a consolidated balance
sheet of Borrower and its Subsidiaries determined on a consolidated basis in
accordance with GAAP as at such date.

                  "Contingent Obligation" means as to any Person, any obligation
of such Person guaranteeing or in effect guaranteeing any Indebtedness, leases,
dividends or other obligations quantified in accordance with the last sentence
of this definition ("the primary obligations") of any other Person (the "primary
obligor") in any manner, whether directly or indirectly, including, without
limitation, any obligation of such Person, whether or not contingent, (a) to
purchase any such primary obligation or any property constituting direct or
indirect security therefor, (b) to advance or supply funds (i) for the purchase
or payment of any such primary obligation or (ii) to maintain working capital or
equity capital of the primary obligor or otherwise to maintain the net worth or
solvency of the primary obligor, (c) to purchase property, securities or
services primarily for the purpose of assuring the owner of any such primary
obligation of the ability of the primary obligor to make payment of such primary
obligation or (d) otherwise to assure or hold harmless the owner of any such
primary obligation against loss in respect thereof; provided, however, that the
term Contingent Obligation shall not include endorsements of instruments for
deposit or collection in the ordinary course of business. The amount of any
Contingent Obligation shall be deemed to be an amount equal to the stated or
determinable amount of the primary obligation in respect of which such
Contingent Obligation is made or, if not stated or determinable, the amount
reasonably anticipated to be payable by Borrower in respect of such Contingent
Obligation as determined by Borrower in good faith.

                  "Contractual Obligation" means, as to any Person, any
provision of any security issued by such Person or of any agreement, instrument
or undertaking to which such Person is a party or by which it or any of its
property is bound.

                  "Costs" has the meaning specified in the Development
Agreement.

                  "Credit Documents" means this Agreement, the Notes, if any,
the Guaranty, the Warrant, the Amendment to Exchange and Registration Rights
Agreement, and any other agreements or instruments that may hereafter be
executed and delivered in favor of Agent, or one or more Lenders pursuant to
this Agreement.

                  "Credit Party" means Borrower and each other party (other than

                                       5.
<PAGE>   6
Agent and Lenders) to a Credit Document.

                  "Default" means any event or occurrence not yet constituting
an Event of Default but which, with the giving of notice or the passage of time
or both, would constitute an Event of Default.

                  "Default Rate" means an interest rate per annum equal to the
otherwise applicable interest rate plus five percent (5.00%) per annum.

                  "Development Agreement" means that Contract for Development of
Globalstar Ground Communication Segment Equipment between Borrower and QUALCOMM,
dated as of March 18, 1994, and all exhibits and schedules thereto, as amended
by that Agreement Regarding General and Administrative Expenses, dated as of
October 5, 1994, and as the same may be further amended, restated, supplemented
or otherwise modified from time to time.

                  "Disputed Amount Rate" shall mean (i) prior to the January 2,
2001 Interest Payment Date, the rate otherwise applicable to Loans hereunder and
(ii) on and after such date, the Default Rate.

                  "Dollar," "Dollars" and "$" means dollars in lawful currency
of the United States of America.

                  "Equity Interests" means any and all shares, interests,
participations or other equivalents (however designated) of capital stock of a
corporation, any and all partnership interests (general or limited) of a
partnership, any and all equivalent ownership interests in a Person (other than
a corporation or partnership) and any and all warrants or options to purchase
any of the foregoing.

                  "Event of Default" means any of the events specified in
SECTION 6.1 hereof.

                  "Exchange and Registration Rights Agreement" means the
Exchange and Registration Rights Agreement, dated as of December 31, 1994, among
Borrower, GTL and partners of the Borrower signatories thereto.

                  "Federal Funds Rate" means, for any period, the rate set forth
in the weekly statistical release designated as H.15(519), or any successor
publication, published by the Federal Reserve Board (including any such
successor, "H.15(519)") for such day opposite the caption "Federal Funds
(Effective)." If on any relevant day such rate is not yet published in
H.15(519), the rate for such day will be the rate set forth in the daily
statistical release designated as the Composite 3:30 p.m. Quotations for U.S.
Government Securities, or any successor publication, published by the Federal
Reserve Bank of New York (including any such successor, the "Composite 3:30 p.m.
Quotation") for such day under the caption "Federal Funds Effective Rate." If on
any relevant day the appropriate rate for such previous day is not yet published
in either H.15(519) or the Composite 3:30 p.m. Quotation, the rate for such day
will be the arithmetic mean of the rates for the last transaction in overnight
Federal funds arranged prior to 9:00 a.m., New York Time, on that day by each of
three leading brokers of federal funds

                                       6.
<PAGE>   7
transactions in New York City selected by the Agent.

                  "Final Maturity Date" means August 15, 2003.

                  "Financing Lease" means (a) any lease of property, real or
personal, the then present value of the minimum rental commitment thereunder of
which should, in accordance with GAAP, be capitalized on a balance sheet of the
lessee, and (b) any other such lease the obligations under which are capitalized
on a consolidated balance sheet of Borrower and its Subsidiaries.

                  "Foreign Subsidiary" means any Subsidiary organized or
incorporated outside the United States of America.

                  "Form W-8" has the meaning specified in SECTION
2.10(b)(v)(B)(1) hereof.

                  "Form 1001" has the meaning specified in SECTION
2.10(b)(v)(A)(1) hereof.

                  "Form 4224" has the meaning specified in SECTION
2.10(b)(vi)(A)(1) hereof.

                  "Funded Debt" means, with respect to any Person, at a
particular date, the sum (without duplication) at such date of (a) all
indebtedness of such Person (i) for borrowed money or (ii) for the deferred
purchase price of property or services (excluding trade payables in the ordinary
course of business and unearned orbital incentives) or (iii) which is evidenced
by a note, bond, debenture or similar instrument, and (b) the capitalized
portion of obligations under Financing Leases.

                  "Funding Date" means each date on or after the Closing Date on
which any of Lenders make a Loan hereunder.

                  "GAAP" means generally accepted accounting principles in the
United States of America in effect on the date hereof, provided that for
purposes of preparation of the financial statements to be delivered pursuant to
SECTION 5.1(e), "GAAP" shall mean generally accepted accounting principles in
the United States in effect from time to time.

                  "Gateway Agreement" means the Production Gateway Purchase
Agreement, dated as of April 30, 1997, by and between Borrower and QUALCOMM, and
all exhibits and schedules thereto, as the same may be amended, restated,
supplemented or otherwise modified from time to time.

                  "Gateway Financing Agreement" means the Letter Agreement,
dated May 23, 1997, between QUALCOMM and Borrower, related to the Gateways to be
financed by QUALCOMM.

                  "Gateway/Handset Vendor Financing" means Indebtedness of
Borrower or any of its Wholly-Owned Subsidiary Guarantors not to exceed
$100,000,000 (excluding accrued interest) in principal amount at any time
outstanding incurred for the purpose of financing the purchase of Globalstar
gateways and user terminals, including gateways and user terminals

                                       7.
<PAGE>   8
purchased for resale to service providers, provided, that such Indebtedness
shall not be secured by any assets of Borrower or any of its Subsidiaries other
than the gateways and user terminals so financed, the proceeds of such resales
and the account in which such proceeds are deposited.

                  "Globalstar Agreements" means the Development Agreement, the
Gateway Agreement and the User Terminal Agreement and any exhibits or schedules
to such agreements, as such agreements may be amended, restated, supplemented or
otherwise modified from time to time .

                  "Globalstar Bank Agreement" means the Credit Agreement, dated
as of August 5, 1999, by and among Borrower, Lenders named therein and Bank of
America, National Association, as administrative agent, and all exhibits and
schedules thereto, and, except as may be stated to the contrary herein, as the
same may be amended, restated, supplemented or otherwise modified from time to
time.

                  "Globalstar System" has the meaning specified in the Recitals
hereto.

                  "Governmental Authority" means any nation or government, any
state or other political subdivision thereof, and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.

                  "GTL" means Globalstar Telecommunications Limited, a Bermuda
exempted company, and a general partner of Borrower.

                  "Guaranty" means the Guaranty, dated as of the date hereof,
made by Loral in favor of Agent, on behalf of Lenders, and all exhibits and
schedules thereto, as the same may be amended, modified, supplemented or
restated from time to time.

                  "Guaranty Fundamental Event of Default" shall mean an Event of
Default under the Guaranty pursuant to SECTION 12 (d)(i), (e), (f), (g), (i) and
(j).

                  "Hedge Agreement" means an interest rate swap, cap or collar
agreement or similar arrangement dealing with interest rates or currency
exchange rates or the exchange of nominal interest obligations, either generally
or under specific contingencies.

                  "Indebtedness" means, with respect to any Person, at a
particular date, the sum (without duplication) at such date of (a) Funded Debt
of such Person, (b) all obligations of such Person in respect of letters of
credit, acceptances, or similar obligations issued or created for the account of
such Person, and (c) all indebtedness or other liabilities (excluding taxes and
assessments) secured by any Lien on any property owned by such Person even
though such Person has not assumed or otherwise become liable for the payment
thereof.

                  "Initial Tranche B Loan" has the meaning specified in SECTION
2.2(b).

                  "Interest Payment Date" means the first Business Day in each
of the months of January, April, July and October.

                                       8.
<PAGE>   9
                  "Lender" or "Lenders" has the meaning specified in the
Preamble hereto.

                  "Lending Office" means, with respect to any Lender, the office
or offices of such Lender specified as its "Domestic Lending Office" opposite
its name on the applicable signature page hereto, or such other office or
offices of such Lender as it may from time to time specify to Borrower and Agent
in writing.

                  "Letter Agreement" means the letter agreement, dated March 4,
1998, by and between QUALCOMM and Borrower, related to a deferred payment
financing facility provided by QUALCOMM to Borrower.

                  "Lien" means any mortgage, deed of trust, pledge, security
interest, hypothecation, assignment, deposit arrangement, encumbrance, lien
(statutory or other), or preference, priority or other security agreement or
preferential agreement of any kind or nature whatsoever (including, without
limitation, any conditional sale or other title retention agreement, or any
financing lease having substantially the same economic effect as any of the
foregoing).

                  "Loan" means a Tranche A Loan or a Tranche B Loan, and "Loans"
means all of such loans, collectively.

                  "Loral" means Loral Space & Communications Ltd., a Bermuda
company.

                  "LSC" means Loral SpaceCom Corporation, a Delaware
corporation.

                  "LSCC" means Loral Space & Communications Corporation, a
Delaware corporation.

                  "Material Adverse Effect" means a material adverse effect on
(a) the Satellite Project, (b) the business, assets, property or condition
(financial or otherwise) of Borrower and its Subsidiaries taken as a whole and
the ability of Borrower and its Subsidiaries to perform their respective
obligations under the Credit Documents or (c) the validity or enforceability of
any of the Credit Documents or the material rights or remedies of Agent or
Lenders hereunder or thereunder.

                  "Net Worth Base Amount" means (a) the Consolidated Net Worth
(whether positive or negative) on the last day of the fiscal quarter ending
prior to the Commencement Date (as defined in SECTION 5.2 (A) below) minus (b)
$100,000,000.

                  "Non-Bank Lender Tax Certificate" has the meaning specified in
SECTION 2.10(b)(vii)(B)(1) hereof.

                  "Note" means a Tranche A Note, if any, or a Tranche B Note, if
any, and "Notes" means all of such notes, collectively, and any and all
replacements, extensions, substitutions and renewals of any such promissory
note.

                  "Notice of Deemed Loan" has the meaning specified in SECTION
2.3 hereof.

                                       9.
<PAGE>   10
                  "Obligations" means, collectively, all Indebtedness,
including, without limitation, all principal, interest, fees, expenses owing to
Agent and Lenders under the Credit Documents (provided that such amounts shall
exclude attorneys' and other fees, costs or expenses of Agent and Lenders solely
in connection with the preparation, negotiation and execution of the Credit
Documents); and Agent's and any Lender's reasonable attorneys' fees and expenses
incurred in administering, amending, enforcing or defending the Credit
Documents, (whether or not suit is brought) and other amounts owed to Agent or
any Lender by any Credit Party pursuant to this Agreement, or the other Credit
Documents, whether absolute or contingent, due or to become due, now existing or
hereafter arising, including any interest that accrues after the commencement of
an insolvency proceeding (including, without limitation, any proceeding
commenced by or against any Credit Party under any provision of the United
States Bankruptcy Code, as amended, or under any other bankruptcy or insolvency
law, including assignments for the benefit of creditors, formal or informal
moratoria, compositions, extensions generally with any Credit Party's creditors,
or proceedings seeking reorganization, arrangement or other relief) and
including any Indebtedness, liability or obligation owing from any Credit Party
to others that Agent or any Lender may have obtained by assignment or otherwise.

                  "Original Development Financing Obligations" has the meaning
specified in the Recitals hereto.

                  "Other Agreements" has the meaning specified in SECTION 3.1(o)
hereof.

                  "Other Globalstar Indebtedness Agreements" means the
Globalstar Bank Agreement, any agreement under which Indebtedness is incurred to
refinance the obligations under the Globalstar Bank Agreement or any Replacement
Globalstar Bank Agreement.

                  "Other Taxes" has the meaning specified in SECTION 2.10(b)(ii)
hereof.

                  "Partner" means each general or limited partner in Borrower
from time to time.

                  "Person" means an individual, partnership, corporation,
business trust, joint stock company, trust, unincorporated association, joint
venture, limited liability company, Governmental Authority or other entity of
whatever nature.

                  "Preferred Equity Interests" means the preferred partnership
interests of Borrower existing at the date of the Globalstar Bank Agreement and
any Equity Interests of Borrower that are preferred or senior in right of
payment to any other Equity Interests of Borrower and which are not mandatorily
redeemable or redeemable at the option of the holder thereof prior to 90 days
after the later of (i) the Revolving Termination Date (as defined in the
Globalstar Bank Agreement) and (ii) the final maturity of the Term Loans (as
defined in the Globalstar Bank Agreement), (the "TERMINATION DATE"); provided
that any Equity Interest that would constitute a Preferred Equity Interest but
for provisions thereof giving holders thereof the right to require Borrower to
repurchase or redeem such interest or obligation upon the occurrence of a change
of control occurring prior to the Termination Date shall constitute Preferred
Equity Interests if the change of control provisions applicable to such interest
or obligation are no more favorable to the holders of such interest or
obligation than the provisions applicable to the Loans (as defined in

                                      10.
<PAGE>   11
the Globalstar Bank Agreement) and such interest or obligation specifically
provides that Borrower will not repurchase or redeem any such interest or
obligation pursuant to such provisions prior to the Borrower's repayment of the
Loans (as defined in the Globalstar Bank Agreement).

                  "Qualified Equity Interests" means Equity Interests in
Borrower which are not mandatorily redeemable and which do not require any
mandatory payments or distributions with respect thereto.

                  "Replacement Globalstar Bank Agreement" means, at any time
that the Globalstar Bank Agreement has been terminated and is not effective, one
or more credit agreements between Borrower and institutional lenders having
aggregate commitment amounts of at least $100,000,000, and all exhibits and
schedules thereto, as the same may be amended, restated, supplemented or
otherwise modified from time to time.

                  "Requirements of Law" means, as to any Person, the Certificate
or Articles of Incorporation and Bylaws or other organizational or governing
documents of such Person, and any Law, treaty, rule or regulation or
determination of an arbitrator or a court or other Governmental Authority, in
each case applicable to or binding upon such Person or any of its property or to
which or by which such Person or any of its property is subject.

                  "Requisite Lenders" means, at any time, Lenders then holding
more than sixty-six and seven-tenths percent (66.7%) of the then aggregate
unpaid principal amount of all Loans then outstanding or, if no Loans are then
outstanding, Lenders then having more than sixty-six and seven-tenths percent
(66.7%) of the Aggregate Commitment.

                  "Responsible Officer" means any of the president, chief
financial officer or treasurer of Borrower.

                  "Satellite Project" means the building, launching and
operation by Borrower of a worldwide, low-earth orbit satellite based digital
telecommunications system which provides wireless voice telephony and other
services.

                  "Service Provider Agreements" means the Founding Service
Provider Agreements, dated as of January 1, 1995, between Borrower and each of
AirTouch Satellite Services, Finmeccanica. S.p.A., Hyundai/DACOM, Loral
Globalstar, L.P., TE.SA.M., and Vodastar Limited and the Service Provider
Agreements between Borrower and each of Al-Murjan Trading & Industrial Co. Ltd.,
Aylesbury Satellite Systems, Bermuda Telephone Company, Chungwha
Telecommunications Co. Ltd., Cupola Group, Globaltel J.S.C., Global Touch,
Martel Telecommunications Co. Ltd., Mobile Telecommunications Africa, Trans Arab
Telecommunication Co., Trinity Globalstar Ltd. and Vantage Holdings Ltd. and any
agreements which the Borrower may enter into in the future with a service
provider to provide voice, fax, data, messaging, paging, geolocation,
information or other services using Borrower's satellite constellation.

                  "Subordinated Indebtedness" means any unsecured Indebtedness
of Borrower, no

                                      11.
<PAGE>   12
part of the principal of which is required to be paid (whether by way of
mandatory sinking fund, mandatory redemption or mandatory prepayment or
otherwise) prior to February 15, 2004, and the payment of principal of and
interest on which, and the payment of any other obligations of Borrower to the
holders of such Subordinated Indebtedness, are subordinated to the prior payment
in full of the Obligations (including, without limitation, obligations in
respect of post-petition interest, whether or not allowed) on terms satisfactory
to Agent and Requisite Lenders.

                  "Subsidiary" means with respect to any Person, a corporation,
partnership or other entity (a) of which Equity Interests having ordinary voting
power (other than Equity Interests having such power only by reason of the
happening of a contingency) to elect a majority of the board of directors or
other managers of such corporation, partnership or other entity are at the time
owned, or the management of which is otherwise controlled, directly or
indirectly through one or more intermediaries, or both, by such Person and (b)
which is consolidated on such Person's financial statements. Unless otherwise
qualified, all references to a "Subsidiary" or to "Subsidiaries" in this
Agreement shall refer to a Subsidiary or Subsidiaries of Borrower.

                   "Subsidiary Guaranty" means the Guaranties to be executed and
delivered by each Subsidiary (other than Subsidiaries organized or incorporated
outside the United States of America) of Borrower existing on the date hereof,
if any, or created or acquired after the date hereof, substantially in the form
of EXHIBIT E, as the same may be amended, supplemented or otherwise modified
from time to time.

                  "Subsidiary Guarantor" means each Subsidiary that is a
guarantor of the Obligations pursuant to a Subsidiary Guaranty.

                  "Taxes" has the meaning specified in SECTION 2.10(b)(i)
hereof.

                  "Term Sheet" means the term sheet, effective as of March 7,
2000, executed by Loral, Borrower and QUALCOMM.

                  "Tranche A Commitment" means, with respect to each Lender, the
amount, if any, set forth on SCHEDULE 1.1 as such Lender's "Tranche A
Commitment," as such amount may be amended from time to time.

                  "Tranche B Commitment" means, with respect to each Lender, the
amount, if any, set forth on SCHEDULE 1.1 as such Lender's "Tranche B Loan
Commitment," as such amount may be amended from time to time.

                  "Tranche A Commitment Percentage" means, as to any Lender, the
percentage equivalent of such Lender's Tranche A Commitment, if any, divided by
the Aggregate Tranche A Commitment.

                  "Tranche B Commitment Percentage" means, as to any Lender, the
percentage equivalent of such Lender's Tranche B Commitment, if any, divided by
the Aggregate Tranche B Commitment.

                                      12.
<PAGE>   13
                  "Tranche B Commitment Period" means the period from and
including the Closing Date to and including December 31, 2000 or such earlier
date on which the Aggregate Tranche B Loan Commitment shall terminate as
provided herein.

                  "Tranche A Lender" means any Lender having a Tranche A
Commitment.

                  "Tranche B Lender" means any Lender having a Tranche B
Commitment.

                  "Tranche A Loan" has the meaning specified in SECTION 2.1
hereof.

                  "Tranche B Loan" has the meaning specified in SECTION 2.2(a)
hereof.

                  "Tranche A Loan Facility" means the Tranche A loan facility
described in SECTION 2 to be provided by Tranche A Lenders to Borrower according
to each Tranche A Lender's Tranche A Commitment.

                  "Tranche B Loan Facility" means Tranche B loan facility
described in SECTION 2 to be provided by Tranche B Lenders to Borrower according
to each Tranche B Lender's Tranche B Commitment.

                  "Tranche A Note" or "Tranche A Notes" means those promissory
notes, if any, referred to in SECTION 2.9(a) hereof

                  "Tranche B Note" or "Tranche B Notes" means those promissory
notes, if any, referred to in SECTION 2.9(b) hereof.

                  "User Terminal Agreement" means the Globalstar User Terminal
(UT) Purchase and Sale Agreement, dated as of April 2, 1998, by and between
Vendor and Borrower and all exhibits and schedules thereto, as the same may be
amended, restated, supplemented or otherwise modified from time to time.

                  "Vendor" means QUALCOMM Incorporated in its capacity as a
provider of goods or services under the Globalstar Agreements or otherwise
relating to the Globalstar System.

                  "Warrant" means that Warrant Certificate, dated the date
hereof, executed by Borrower in favor of QUALCOMM, and all replacements,
extensions, substitutions and renewals thereof.

                  "Wholly Owned Subsidiary" means any Subsidiary of Borrower to
the extent at least 99% of the Equity Interests of such Subsidiary, other than
directors' or nominees' qualifying shares, are owned directly or indirectly by
Borrower.

                  "Wholly Owned Subsidiary Guarantor" means each Wholly Owned
Subsidiary that is a guarantor of the Obligations pursuant to a Subsidiary
Guaranty.

         1.2 OTHER INTERPRETIVE PROVISIONS.

                                      13.
<PAGE>   14
                  (a) All terms defined in this Agreement shall have their
defined meanings when used in the other Credit Documents and any certificate or
other document made or delivered pursuant hereto, unless the context clearly
indicates otherwise.

                  (b) As used in this Agreement and the other Credit Documents
and any certificate or other document made or delivered pursuant hereto,
accounting terms relating to Borrower not defined in SECTION 1.1 above, and
accounting terms partly defined in SECTION 1.1 above to the extent not defined,
shall have the respective meanings given to them under GAAP.

                  (c) The words "hereof," "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement. Section,
subsection, schedule and exhibit references are to this Agreement unless
otherwise specified.

                  (d) All terms defined in this Agreement in the singular form
shall have comparable meanings when used in the plural form and vice versa.

                  (e) Unless otherwise specified herein, all accounting terms
used herein shall be interpreted, and all financial statements required to be
delivered hereunder shall be prepared in accordance with, GAAP. If any changes
in GAAP from those used in the preparation of the financial statements referred
to in SECTION 4.1 hereof ("GAAP Changes") hereafter occasioned by the
promulgation of rules, regulations, pronouncements and opinions by or required
by the Financial Accounting Standards Board of the American Institute of
Certified Public Accountants (or successors thereto or agencies with similar
functions) result in a change in the method of calculation of any of the
financial covenants, standards or other terms or conditions found in this
Agreement, the financial statements furnished from time to time hereunder shall
be presented with reconciliation worksheets and all such financial covenants,
standards or other terms or conditions found herein shall be calculated in
accordance with GAAP as in effect immediately prior to such GAAP Changes.

SECTION 2. TRANCHE A FACILITY; TRANCHE B FACILITY.

         2.1 TRANCHE A FACILITY. Upon the terms, subject to the conditions and
in reliance upon the representations and warranties of Borrower set forth in
this Agreement and in the other Credit Documents, each Lender having a Tranche A
Commitment severally agrees to make a single credit extension on the Closing
Date to Borrower (a "Tranche A Loan") in an aggregate principal amount equal to
such Lender's Tranche A Commitment, in accordance with the terms and as more
fully set forth in this SECTION 2. The Tranche A Loan extended by each Lender on
the Closing Date will be made by way of a book entry by Borrower and such Lender
and the issuance by Vendor of a payment certificate to Borrower evidencing
Borrower's satisfaction of the Original Development Financing Obligations as of
the Closing Date, and no cash will be advanced by such Lender to Borrower. The
amount of Tranche A Loans outstanding on the Closing Date is set forth on
Schedule 1.1. Once repaid, Tranche A Loans may not be re-borrowed.

                                      14.
<PAGE>   15
         2.2 TRANCHE B FACILITY.

                  (a) TRANCHE B COMMITMENT. Upon the terms, subject to the
conditions and in reliance upon the representations and warranties of Borrower
set forth in this Agreement and in the other Credit Documents, each Lender
having a Tranche B Commitment severally agrees to make credit extensions from
time to time to Borrower to finance Additional Development Financing Obligations
(each such credit extension provided by such Lender being referred to herein as
a "Tranche B Loan"), in such Lender's Tranche B Commitment Percentage of such
aggregate amounts, from the Closing Date to and including December 31, 2000
(such date, unless terminated earlier pursuant to this Agreement, the
"Commitment Termination Date"). Except with respect to mandatory prepayments
made pursuant to SECTION 2.7(B)(II) below, once repaid, Tranche B Loans may not
be re-borrowed.

                  (b) INITIAL TRANCHE B LOANS. Each Lender having a Tranche B
Commitment severally agrees to make an Initial Tranche B Loan on the Closing
Date (such Lender's "Initial Tranche B Loan") in an aggregate principal amount
equal to such Lender's Tranche B Commitment Percentage of the aggregate amount
(the "Initial Aggregate Tranche B Funding") of Additional Development Financing
Obligations and that portion of the late charges remaining unpaid as referenced
in the Term Sheet, in each case as of the opening of business on the Closing
Date, in accordance with the terms and as more fully set forth in this SECTION
2. Each Lender's Initial Tranche B Loan will be made by way of a book entry on
the Closing Date by Borrower and such Lender and issuance by Vendor of a payment
certificate to Borrower evidencing Borrower's satisfaction of the Additional
Development Financing Obligations as of the Closing Date, and no cash will be
advanced by such Lender. The amount of Tranche B Loans outstanding on the
Closing Date is set forth on Schedule 1.1.

         2.3 NOTICE AND MANNER OF MAKING TRANCHE B LOANS; DISPUTED AMOUNTS.

                  (a) On each date prior to the Commitment Termination Date on
which payment is due to Vendor pursuant to invoices issued to Borrower pursuant
to the Development Agreement, Vendor shall deliver to Agent by electronic
facsimile transmission written notice of such due date and the amount of such
payment due under the invoices issued to Borrower pursuant to the Development
Agreement (less any amounts in respect of any portion of an invoice as to which
Vendor and Agent have received written claim from Borrower which claim is
prepared in good faith and provides a reasonably detailed description of that
portion of the applicable invoice which Borrower disputes ("Disputed Amounts")
is due and payable and the basis therefor), which notice shall be in the form of
EXHIBIT B to this Agreement (a "Notice of Deemed Loan"), and a borrowing of
Tranche B Loans shall be deemed to have been made as of the date on which such
payment was due along with simultaneous issuance by Vendor of a payment
certificate to Borrower evidencing Borrower's satisfaction of the undisputed
amount. The amount of Tranche B Loans owing to each Tranche B Lender shall
automatically be increased as of such date to add to the principal amount
thereof the amount set forth in the Notice of Deemed Loan according to the
Tranche B Commitment Percentage of each Lender making such Tranche B Loan (i) as
of the applicable due date in respect of payments owing to QUALCOMM in its
capacity as a Lender and (ii) as of the date, as to any other Lender, that such

                                      15.
<PAGE>   16
Lender remits funds in respect of such Loan to Agent for payment to Vendor.
Notwithstanding the foregoing, any failure by Vendor to deliver notice in
accordance with this SECTION 2.3 shall in no way diminish Agent's or Lenders'
rights under this Agreement.

                  (b) Notwithstanding anything herein to the contrary, (i) all
Disputed Amounts whether or not ultimately resolved in favor of QUALCOMM will be
treated as Loans outstanding hereunder for the purposes of calculating the
availability of Loans under the Tranche B Commitment, (ii) Disputed Amounts
ultimately resolved in favor of QUALCOMM shall constitute Loans hereunder and
shall accrue interest on the terms set forth in SECTION 2.5 at the Disputed
Amount Rate from the original due date of the applicable invoice, (iii) the
principal amount of all Loans arising from Disputed Amounts ultimately resolved
in favor of QUALCOMM shall be repaid in equal installments over the remaining
scheduled principal repayment dates under SECTION 2.4.

         2.4 SCHEDULED PAYMENT OF PRINCIPAL OF THE LOANS.

                  (a) TRANCHE A LOANS. The Tranche A Loans shall mature in ten
(10) installments on the dates set forth below, commencing on January 15, 2001.
Each such installment payable to a given Lender shall be in an amount equal to
such Lender's Tranche A Commitment Percentage multiplied by the aggregate
principal amount of Tranche A Loans outstanding as of October 2, 2000 multiplied
by the fraction set forth below opposite the applicable installment date:

<TABLE>
<CAPTION>
                    INSTALLMENT DATE                           FRACTION

<S>                                                            <C>
                    January 15, 2001                           13/400
                     March 31, 2001                            10/400
                      June 30, 2001                            13/400
                   September 30, 2001                          10/400
                    December 31, 2001                          10/400
                     March 31, 2002                            15/400
                      June 30, 2002                            60/400
                     August 15, 2002                           20/400
                     March 31, 2003                            75/400
                     August 15, 2003                           174/400
</TABLE>

                  (b) TRANCHE B LOANS. The Tranche B Loans shall mature in ten
(10) installments on the dates set forth below, commencing on January 15, 2001.
Each such installment payable to a given Lender shall be in an amount equal to
such Lender's Tranche B Commitment Percentage multiplied by the aggregate
principal amount outstanding under the Tranche B Facility as of the last day of
the Tranche B Commitment Period multiplied by the fraction set forth below
opposite the applicable installment date:

<TABLE>
<CAPTION>
                      INSTALLMENT DATE                          FRACTION

<S>                                                             <C>
                      January 15, 2001                          13/400
</TABLE>

                                      16.
<PAGE>   17
<TABLE>
<S>                                                             <C>
                       March 31, 2001                           10/400
                        June 30, 2001                           13/400
                     September 30, 2001                         10/400
                      December 31, 2001                         10/400
                       March 31, 2002                           15/400
                        June 30, 2002                           60/400
                       August 15, 2002                          20/400
                       March 31, 2003                           75/400
                       August 15, 2003                          174/400
</TABLE>

         2.5 INTEREST RATES; PAYMENT OF INTEREST; CALCULATION OF INTEREST.

                  (a) INTEREST RATE AND PAYMENT OF INTEREST. Subject to SECTION
2.5(C) below, each Loan shall bear interest on the outstanding principal amount
thereof at a rate per annum equal to six percent (6.00%). Unless Borrower shall
have paid such interest to Agent for the account of Lenders on or prior to the
Interest Payment Date, such interest shall automatically, without any action or
notice, on each Interest Payment Date occurring during the period from the
Closing Date through and including the October 2, 2000 Interest Payment Date, be
added to the outstanding principal amount of the Loans and interest shall accrue
thereon at the applicable interest rate. Interest shall be payable in cash on
all Interest Payment Dates after the October 2, 2000 Interest Payment Date.

                  (b) CALCULATION OF INTEREST. Interest on the Loans shall be
computed on the basis of a 360-day year for the actual number of days elapsed.
In computing interest on any Loan, the date of the making of such Loan shall be
included and the date of payment shall be excluded; provided, however, that if
any Loan is repaid on the same day on which it is made, such day shall be
included in computing interest on such Loan.

                  (c) DEFAULT INTEREST. Upon the occurrence and for so long as
an Event of Default shall continue, including after acceleration (whether before
or after entry of judgment), Borrower shall pay interest on the principal amount
of each Loan then outstanding at the Default Rate.

         2.6 PAYMENT PROCEDURES.

                  (a) PAYMENT ON BUSINESS DAYS. Whenever any payment due under
this Agreement shall fall due on a day other than a Business Day, the due date
of such payment shall be extended to the next succeeding Business Day and such
payment shall be made on such Business Day, and such extension of time shall be
included in the computation of interest.

                  (b) PLACE OF PAYMENT. Borrower shall make all payments or
prepayments of the principal of the Loans, and all payments of the interest on
the Loans and all other amounts owed by Borrower to Agent or Lenders under this
Agreement to the Agent's

                                      17.
<PAGE>   18
Payment Office, in lawful money of the United States of America and in
immediately available funds no later than 1:00 p.m., New York time, on the date
of payment (which must be a Business Day). All payments received after 1:00
p.m., New York time, on any Business Day, shall be deemed to have been received
on the next succeeding Business Day. After the occurrence and during the
continuance of an Event of Default, Borrower authorizes Lenders to charge from
time to time against any or all of Borrower's deposits maintained with Lenders
any amount payable by Borrower hereunder not paid when due. Each Lender shall
promptly notify Agent of each such charge and pay over the same to Agent for
application in accordance with this Agreement

                  (c) DISTRIBUTION OF PAYMENTS TO LENDERS BY AGENT. Upon receipt
of any and all payments or prepayments of the principal of the Loans, and any
and all payments of the interest on the Loans and any and all other amounts owed
by Borrower to Agent or Lenders under this Agreement, Agent shall promptly pay
over to each Lender at its Lending Office its Tranche A Commitment Percentage or
Tranche B Commitment Percentage, as applicable, of the same in like funds in the
sum received.

                  (d) APPLICATION OF PAYMENTS. Except as specifically set forth
herein, all payments under this Agreement shall be credited first to all
expenses then due to Agent, next to all expenses then due to Lenders, next to
all interest then due, and lastly to all principal then due.

                  (e) DESIGNATION OF PAYMENT. When making a payment under this
Agreement, Borrower shall clearly specify which Loan, fee or expense such
payment relates to and the nature of the payment.

                  (f) AGENT'S RIGHT TO ASSUME PAYMENTS WILL BE MADE BY BORROWER.
Unless Agent shall have been notified by Borrower prior to the date on which any
payment to be made by Borrower hereunder is due that Borrower does not intend to
remit such payment, Agent may (in its sole and absolute discretion) assume that
Borrower has remitted such payment when so due and Agent may (in its sole and
absolute discretion) and in reliance upon such assumption, make available to
each Lender on such payment date an amount equal to such Lender's Tranche A
Commitment Percentage or Tranche B Commitment Percentage of such assumed
payment. If Borrower has not in fact remitted such payment to Agent, each Lender
shall forthwith on demand repay to Agent the amount of such assumed payment made
available to such Lender, together with interest thereon in respect of each date
from and including the date such amount was made available by Agent to such
Lender to the date such amount is repaid to Agent, at the Federal Funds Rate.

         2.7 PREPAYMENTS OF THE LOANS; AGGREGATE COMMITMENT REDUCTION.

                  (a) VOLUNTARY PREPAYMENTS. The Loans may be prepaid at any
time and from time to time, without premium or penalty, upon one (1) Business
Day's notice; provided, however, that (i) any such prepayment shall be in the
minimum principal amount of Fifty Thousand Dollars ($50,000), (ii) any interest
accrued on the amounts so prepaid to the date of such payment shall be paid at
the time of any such payment and (iii) any such prepayment shall, if made during
the Tranche B Commitment Period, cause the Aggregate

                                      18.
<PAGE>   19
Tranche A Commitment to be reduced permanently by the amount of such prepayment.

                  (b) MANDATORY PREPAYMENTS.

                           (i) Borrower shall immediately prepay a portion of
the Tranche B Loans to the extent the total outstanding balance of all Tranche B
Loans exceeds the Aggregate Tranche B Commitment.

                           (ii) In the event Borrower shall be entitled to
receive any payment from Vendor or any of Vendor's Affiliates in respect of
amounts claimed under any of the Globalstar Agreements (other than Gateway NRE
Recoupment Payments and User Terminal NRE Recoupment Payments as defined in, and
required to be paid under, the Development Agreement), all such amounts shall be
immediately deemed to be applied to prepay the Obligations outstanding
hereunder; provided, however, that prior to the Commitment Termination Date, the
Tranche B Commitment of each Lender shall be available for reborrowing in the
amount of the prepayment received by such Lender.

                           (iii) Borrower shall immediately prepay the Loans if
a Change of Control occurs.

                           (iv) From and after such date as there shall have
occurred a Guaranty Fundamental Event of Default, Borrower shall immediately
prepay the Loans such that the Guaranteed Amount (as defined in the Guaranty)
shall at all times be zero, notwithstanding the effectiveness of any provisions
of the Guaranty.

                           (v) If on any date the Guaranteed Amount (as defined
in the Guaranty) becomes greater than zero and there has been an Event of
Default under the Loral Indenture (as defined in the Guaranty) that shall have
continued more than (i) 30 days in respect of an Event of Default under Section
6.1(1) of the Loral Indenture or (ii) 60 days in respect of an Event of Default
under the Loral Indenture other than under Section 6.1(1) thereof, then Borrower
shall immediately prepay the Loans such that the Guaranteed Amount (as defined
in the Guaranty) shall at all times be zero, notwithstanding the effectiveness
of any provisions of the Guaranty

                  (c) APPLICATION OF PREPAYMENTS. Voluntary prepayments of the
Loans made pursuant to this SECTION 2.7 shall be applied ratably between the
Tranche A Facility and the Tranche B Facility. Prepayments applied to the
Tranche A Facility or the Tranche B Facility shall be applied in the inverse
order of maturity.

         2.8 SURVIVABILITY. All of Borrower's obligations under this Agreement
shall survive until all obligations of Borrower to make payments to Agent and
Lenders under all Credit Documents are fully satisfied and Lenders' obligations
to make the Loans hereunder expire. Notwithstanding the foregoing, Borrower's
obligations set forth in SECTIONS 8.4 and 8.14 of this Agreement shall survive
Borrower's payment of all obligations under the Credit Documents and the
expiration of Lenders' obligations to make Loans hereunder.

                                      19.
<PAGE>   20
         2.9 PROMISSORY NOTES.

                  (a) TRANCHE A NOTES. Each Tranche A Lender shall maintain in
accordance with its usual practice an account or accounts evidencing the
Indebtedness of Borrower to such Lender resulting from each Tranche A Loan owing
to such Lender, including the amounts of principal and interest payable and paid
to such Lender from time to time hereunder in respect of such Loan. Borrower
agrees that upon notice by any Tranche A Lender to Borrower (with a copy of such
notice to Agent) to the effect that a promissory note or other evidence of
Indebtedness is required or appropriate in order for such Lender to evidence
(whether for purposes of pledge, enforcement or otherwise) the Tranche A Loans
owing to, or to be made by, such Lender, Borrower shall promptly execute and
deliver to such Lender, with a copy to Agent, a promissory note substantially in
the form of EXHIBIT A-1 attached hereto or in form and substance reasonably
satisfactory to Borrower and such Lender (each an "Tranche A Note"), with
appropriate insertions, due on the earlier of its acceleration pursuant to the
terms of this Agreement or the Final Maturity Date, and payable to the order of
such Lender in a principal amount equal to the Tranche A Commitment of such
Lender. Notwithstanding anything to the contrary herein, Borrower agrees that
the books and records of Agent maintained to evidence such matters shall be
conclusive absent manifest error as evidence of the matters noted or recorded;
provided, however, that any failure by Agent to make such notations or
recordations shall not reduce Borrower's liability thereunder.

                  (b) THE TRANCHE B NOTES. Each Tranche B Lender shall maintain
in accordance with its usual practice an account or accounts evidencing the
Indebtedness of Borrower to such Lender resulting from each Tranche B Loan owing
to such Lender from time to time, including the amounts of principal and
interest payable and paid to such Lender from time to time hereunder. Borrower
agrees that upon notice by any Tranche B Lender to Borrower (with a copy of such
notice to Agent) to the effect that a promissory note or other evidence of
Indebtedness is required or appropriate in order for such Lender to evidence
(whether for purposes of pledge, enforcement or otherwise) the Tranche B Loans
owing to, or to be made by, such Lender, Borrower shall promptly execute and
deliver to such Lender, with a copy to Agent, a promissory note substantially in
the form of EXHIBIT A-2 attached hereto or in form and substance reasonably
satisfactory to Borrower and such Lender (each a "Tranche B Note"), with
appropriate insertions, due on the earlier of its acceleration pursuant to the
terms of this Agreement or the Final Maturity Date, and payable to the order of
such Lender in a principal amount equal to the Tranche B Commitment of such
Lender. Notwithstanding anything to the contrary herein, Borrower agrees that
the books and records of Agent maintained to evidence such matters shall be
conclusive absent manifest error as evidence of the matters noted or recorded;
provided, however, that any failure by Agent to make such notations or
recordations shall not reduce Borrower's liability thereunder.

         2.10 CHANGED CIRCUMSTANCES; TAXES.

                  (a) If any law, regulation, treaty or official directive or
the interpretation or application thereof by any court or by any other
Governmental Authority charged with the administration thereof or the compliance
with any guideline or request of any

                                      20.
<PAGE>   21
central bank or other Governmental Authority (whether or not having the force of
law):

                           (i) subjects any Lender to any tax with respect to
payments of principal or interest or any other amounts payable hereunder by
Borrower or otherwise with respect to the transactions contemplated hereby
(except for such taxes as are imposed on or measured by each Lender's net income
by the jurisdiction under the laws of which such Lender is organized or
maintains or maintained a place of business directly or through an agent or
through a partnership or other conduit entity or any political subdivision
thereof), or

                           (ii) after a person becomes a Lender pursuant to this
Agreement, imposes, modifies or deems applicable any additional deposit
insurance, reserve, special deposit or similar requirement against assets held
by, or deposits in or for the account of, or loans by, such Lender (including,
without limitation, any imposition of a reserve percentage), or

                           (iii) after a person becomes a Lender pursuant to
this Agreement, imposes upon any Lender any additional condition with respect to
its performance under this Agreement,

and the result of any of the foregoing is to increase the cost to such Lender,
reduce the income receivable by such Lender or impose any expense upon such
Lender with respect to any Loans, such Lender shall notify Borrower thereof.
Borrower agrees to pay to such Lender the amount of such increase in cost,
reduction in income or additional expense as and when such cost, reduction or
expense is incurred or determined, upon presentation by such Lender of a
statement in the amount and setting forth such Lender's calculation thereof,
which statement shall be deemed true and correct absent manifest error.

                  (b) (i) Any and all payments by Borrower to each Lender under
this Agreement shall be made free and clear of, and without deduction or
withholding for, any and all present or future taxes, levies, imposts,
deductions, charges or withholdings, and all liabilities with respect thereto,
excluding, in the case of each Lender, such taxes (including income taxes, taxes
on profits and franchise taxes) as are imposed on or measured by each Lender's
net income or profits by the jurisdiction under the laws of which such Lender is
organized or maintains or maintained a place of business or any political
subdivision thereof (all such non-excluded taxes, levies, imposts, deductions,
charges, withholdings and liabilities being hereinafter referred to as "Taxes").

                           (ii) Borrower shall indemnify and hold harmless each
Lender for the full amount of Taxes (including any Taxes imposed by any
jurisdiction on amounts payable under this SECTION 2.10) paid by such Lender and
any liability arising therefrom or with respect thereto, whether or not such
Taxes were correctly or legally asserted. Payment under this indemnification
shall be made within thirty (30) days from the date such Lender makes written
demand therefor.

                           (iii) If Borrower shall be required by law to deduct
or withhold any Taxes from or in respect of any sum payable hereunder to any
Lender,

                                      21.
<PAGE>   22
then:

                                    (A) the sum payable shall be increased as
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this SECTION 2.10) such Lender
receives an amount equal to the sum it would have received had no such
deductions been made;

                                    (B) Borrower shall make such deductions; and

                                    (C) Borrower shall pay the full amount
deducted to the relevant taxation authority or other authority in accordance
with applicable law.

                           (iv) Within thirty (30) days after the date of
payment by Borrower of Taxes, Borrower shall furnish to Agent and each Lender
the original or a certified copy of a receipt evidencing payment thereof, or
other evidence of payment satisfactory to Agent.

                           (v) If Borrower fails to pay any Taxes when due to
the appropriate taxing authority or fails to furnish to each Lender the required
receipts or other required documentary evidence, Borrower shall indemnify
Lenders for any incremental Taxes, interest or penalties that may become payable
by any of Lenders as a result of any such failure.

                           (vi) Each Lender which is a foreign Person (i.e., a
Person other than a United States person within the meaning of Section 7701 (c)
(30) of the Code) agrees that:

                                    (A) in the case of any Lender which is not
claiming exemption under foreign withholding taxes under Sections 871(h) or
881(c) of the Code,

                                             (1) it shall, no later than the
Closing Date (or, in the case of a Lender which becomes a party hereto pursuant
to this Agreement after the Closing Date, the date upon which such Lender
becomes a party hereto) deliver to Borrower and Agent two (2) accurate and
complete signed originals of IRS Form 4224 or any successor thereto ("Form
4224"), or two accurate and complete signed originals of IRS Form 1001 or any
successor thereto ("Form 1001"), as appropriate, in each case establishing that
such Lender is on the date of delivery thereof entitled to receive payments of
principal, interest and fees under this Agreement free from withholding of
United States federal income tax;

                                             (2) if at any time a change in
circumstances necessitates any Lender's filing a new Form 4224 or Form 1001, it
shall within thirty (30) days after such change becomes effective deliver to
Borrower and Agent in replacement for, or in addition to, the forms previously
delivered by it hereunder, two accurate and complete signed originals of Form
4224, or two accurate and complete signed originals of Form 1001, as
appropriate, in each case establishing that such Lender is on the date of
delivery thereof entitled to receive payments of principal, interest and fees
under this Agreement free from withholding of

                                      22.
<PAGE>   23
United States federal income tax;

                                    (B) in the case of any Lender other than a
Lender described in clause (A) above,

                                             (1) it shall, no later than the
Closing Date (or, in the case of a Lender which becomes a party hereto pursuant
to this Agreement after the Closing Date, the date upon which such Lender
becomes a party hereto) deliver to Borrower and Agent two (2) accurate and
complete signed originals of a certificate substantially in the form of EXHIBIT
C hereto (any such certificate, a "Non-Bank Lender Tax Certificate") and two
accurate and complete signed originals of IRS Form W-8 or any successor thereto
("Form W-8") certifying to such Lender's legal entitlement (assuming compliance
by Borrower with the terms of this Agreement) to an exemption whereby such
Lender is on the date of delivery thereof entitled to receive payments of
principal, interest and fees under this Agreement free from withholding of
United States Federal income tax;

                                             (2) if at any time a change in
circumstances necessitates any Lender's filing a new Form W-8, it shall within
thirty (30) days after such change becomes effective deliver to Borrower and
Agent in replacement for, or in addition to, the forms previously delivered by
it hereunder, two accurate and complete signed originals of Form W-8 certifying
to such Lender's legal entitlement (assuming compliance by Borrower with the
terms of this Agreement) to an exemption whereby such Lender is on the date of
delivery thereof entitled to receive payments of principal, interest and fees
under this Agreement free from withholding of United States federal income tax;
and

                                    (C) each Lender that is a foreign person
shall, promptly upon Borrower's reasonable request to that effect, deliver to
Borrower and Agent copies of such other forms or similar documentation as may be
required from time to time by any applicable law, treaty, rule or regulation in
order to establish such Lender's tax status for withholding purposes. If any
Taxes paid or incurred by the Borrower under SECTION 2.10(B) hereof were
incorrectly or illegally asserted or if the Borrower or the Lender is entitled
to a refund of such Taxes, Lender shall use its reasonable best efforts to
assist or obtain such refund for the benefit of the Borrower

                           (vii) Borrower will not be required to pay any
additional amounts in respect of United States federal income tax pursuant to
SECTION 2.10(B) hereof to any Lender:

                                    (A) if the obligation to pay such additional
amounts would not have arisen but for a failure by such Lender to comply with
its obligations under SECTION 2.10(B)(VI) hereof ; or

                                    (B) if such Lender shall have delivered to
Borrower and Agent a Form 4224, Form 1001 or Form W-8 pursuant to SECTION
2.10(b)(vii) hereof, and such Lender shall not at any time be entitled to
exemption from deduction or withholding of United States federal income tax in
respect of payments by Borrower hereunder

                                      23.
<PAGE>   24
for the account of such Lender for any reason other than a change in United
States law or regulations or in the official interpretation of such law or
regulations by any Governmental Authority charged with the interpretation or
administration thereof (whether or not having the force of law) after the date
of delivery of such form.

                           (viii) If, at any time, Borrower requests any Lender
to deliver any forms or other documentation in addition to those required
pursuant to SECTION 2.10(b)(vii)(c) hereof, then Borrower shall, on demand of
such Lender, reimburse such Lender for any costs and expenses (including
reasonable attorney costs) reasonably incurred by such Lender in the preparation
or delivery of such forms or other documentation.

                           (ix) If Borrower is required to pay additional
amounts to any Lender pursuant to SECTION 2.10(B) hereof, then such Lender shall
use its reasonable best efforts (consistent with legal and regulatory
restrictions) to change the jurisdiction of its Lending Office so as to
eliminate any such additional payment by such Lender which may thereafter accrue
if such change in the judgment of such Lender is not otherwise materially
disadvantageous to such Lender.

                  (c) Notwithstanding anything in this SECTION 2.10 to the
contrary, no payment shall be required under this SECTION 2.10 to the extent
that an assignment or participation of the type described in the first proviso
of SECTION 8.6 shall have occurred and such payment would not have been required
but for such assignment or participation.

         2.11 ORIGINAL ISSUE DISCOUNT. Borrower and QUALCOMM hereby acknowledge
and agree that the Warrant is part of an investment unit within the meaning of
Section 1273(c)(2) of the Internal Revenue Code of 1986, as amended, which
investment unit includes all Loans up to the maximum amount of Aggregate
Commitments. Borrower and QUALCOMM agree that the fair market value of the
Warrant shall be determined by QUALCOMM subject to the approval of Borrower,
such approval not to be unreasonably withheld. Borrower and QUALCOMM shall
prepare their respective federal income tax returns in a manner consistent with
such determination.

SECTION 3. CONDITIONS OF LENDING.

         3.1 CONDITIONS PRECEDENT TO CLOSING. The obligation of Lenders to make
the initial Tranche A Loans and the initial Tranche B Loans in favor of Borrower
is subject to the satisfaction (all Credit Documents and other documents to be
delivered to Agent and any Lender pursuant to this SECTION 3.1 shall be subject
to prior approval as to form and substance by Agent and Lenders) of the
following conditions which in no event shall occur later than June 5, 2000.

                  (a) NOTES. Borrower shall have duly executed and delivered, to
each Tranche A Lender which has requested a Tranche A Note, and to each Tranche
B Lender which has requested a Tranche B Note, a Tranche A Note and Tranche B
Note, as applicable.

                                      24.
<PAGE>   25
                  (b) GUARANTY. There shall have been delivered to Agent the
Guaranty, duly executed by Loral.

                  (c) SUBSIDIARY GUARANTIES. There shall have been delivered to
Agent the Subsidiary Guaranties, duly executed by each Subsidiary of Borrower.

                  (d) WARRANT AND RELATED DOCUMENTS . There shall have been
delivered to Lenders the Warrant and Amendment to Exchange and Registration
Rights Agreement, in each case duly executed by the parties thereto.

                  (e) OPINIONS OF COUNSEL. Lenders and Agent shall have received
such opinions dated the Closing Date, from Willkie Farr & Gallagher, counsel to
Borrower, as Agent and Lenders shall require, in form and substance satisfactory
to Agent's and Lenders' counsel.

                  (f) NO DEFAULT; REPRESENTATIONS AND WARRANTIES. At the time of
making the initial Loan and also after giving effect thereto (i) there shall
exist no Event of Default or Default, and (ii) all representations and
warranties contained herein and in the other Credit Documents in effect at such
time shall be true and correct in all material respects.

                  (g) OFFICER'S CERTIFICATE. Agent shall have received a
certificate dated as of the Closing Date, signed by the president and chief
financial officer of Borrower, certifying as to the matters set forth in SECTION
3.1(f) and certifying that all of the applicable conditions set forth in this
SECTION 3.1 have been satisfied as of such date.

                  (h) PARTNERSHIP PROCEEDINGS. All partnership and legal
proceedings and all instruments and agreements in connection with the
transactions contemplated by this Agreement and the other Credit Documents shall
be satisfactory in form and substance to Agent and Lenders, and Lenders shall
have received all information and copies of all certificates, documents and
papers, including records of partnership proceedings and governmental approvals,
if any, which Lenders may have reasonably requested in connection therewith,
such documents and papers where appropriate to be certified by proper officers
or governmental authorities.

                  (i) GLOBALSTAR BANK AGREEMENT CERTIFICATION AND CONSENT. Agent
shall have received a copy of the Globalstar Bank Agreement together with all
amendments, modifications and consents entered into in connection therewith,
certified by the chief financial officer of Borrower that the same is a true,
accurate and complete.

                  (j) ADVERSE CHANGE. Nothing shall have occurred, including,
without limitation, the termination of any contract, lease or other agreement,
the incurrence of any damage, destruction or loss (whether or not covered by
insurance), the occurrence of any employee strike, work-stoppage, slow-down or
lock-out or any substantial threat directed to Borrower or any Subsidiary of
Borrower of any imminent strike, work-stoppage, slow-down or lock-out, which
Lenders shall reasonably determine has, or is reasonably expected to have, a
Material Adverse Effect.

                                      25.
<PAGE>   26
                  (k) CONSENTS, APPROVALS. Borrower shall have received all
necessary governmental and third party consents, approvals and licenses in
connection with the transactions contemplated by the Credit Documents and
otherwise referred to herein to be obtained on or before the initial Funding
Date, except to the extent the failure to obtain such consents, approvals and
licenses, individually or in the aggregate, could not reasonably be expected to
have a Material Adverse Effect.

                  (l) ORGANIZATIONAL DOCUMENTATION; ETC.

                           (i) BORROWER. Agent and each Lender shall have
received a certificate of the Secretary of the managing general partner of
Borrower, dated the Closing Date and attaching thereto (and certifying the
truth, correctness and completeness of such attachments) (A) the Certificate of
Partnership and the partnership agreement of Borrower and any other agreements
entered into by any such entity governing the terms and relative rights of its
partnership interests, (B) resolutions of Borrower approving and authorizing the
execution, delivery and performance of the Credit Documents to which it is a
party and the transactions contemplated thereby, and (C) an incumbency
certificate of the officers of each general partner of Borrower executing this
Agreement or the other Credit Documents to which Borrower is or is to be a
party, with specimen signatures for such officers. In addition, Borrower shall
have delivered to Agent a Certificate of Good Standing (and, where available, a
certificate as franchise tax good standing) issued by the Delaware Secretary of
State and appropriate government officials for each other state in which
Borrower is qualified to do business or in which the failure to so qualify would
be reasonably likely to have a Material Adverse Effect.

                           (ii) GUARANTOR. Agent and each Lender shall have
received a certificate of Loral, dated the Closing Date and attaching thereto
(and certifying the truth, correctness and completeness of such attachments) (A)
the charter documents and bylaws of Loral, (B) Board of Director resolutions of
Loral approving and authorizing the execution, delivery and performance of the
Guaranty and the transactions contemplated thereby and (C) an incumbency
certificate of Loral's officers executing the Credit Documents to which it is or
is to be a party, with specimen signatures for such officers. In addition,
Borrower shall have delivered to Agent a Certificate of Good Standing or its
Bermuda equivalent (and, where available, a certificate as franchise tax good
standing) issued by the appropriate Governmental Authority in Bermuda and
appropriate government officials for each other jurisdiction in which Borrower
is qualified to do business or in which the failure to so qualify would be
reasonably likely to have a material adverse effect on (i) the business,
properties, assets, results of operations or financial condition or prospects of
Loral and its Subsidiaries taken as a whole or (ii) the ability of Loral to
discharge the Obligations in accordance with their terms.

                           (iii) GTL CERTIFICATE. Agent and each Lender shall
have received a certificate of GTL, dated the Closing Date and attaching thereto
(and certifying the truth, correctness and completeness of such attachments) (A)
the charter documents and byelaws of GTL, (B) Board of Director resolutions of
GTL approving and authorizing the execution, delivery and performance of the
Exchange and Registration Rights Agreement as amended pursuant to the Amendment
to Exchange and Registration Rights Agreement and the

                                      26.
<PAGE>   27
transactions contemplated thereby and (C) an incumbency certificate of GTL's
officers executing the Amendment to Exchange and Registration Rights Agreement,
with specimen signatures for such officers.

                  (m) LITIGATION. There shall be no actions, suits or
proceedings pending or threatened with respect to Loral, either general partner
of Borrower or Borrower or any Subsidiary that might be expected to (i) have a
Material Adverse Effect, or (ii) have a material adverse effect on the ability
of Loral or any such general partner or Borrower to perform their obligations
under the Globalstar Agreements or the Credit Documents, as applicable, or the
rights or remedies of Vendor under the Globalstar Agreements. There shall not
exist any judgment, order, injunction or other restraint issued or filed or a
hearing seeking injunctive relief or other restraint pending or notified with
respect to the performance of the Globalstar Agreements, the Credit Documents,
or the making of any Loan hereunder.

                  (n) NO VIOLATION OF LAW. The consummation of the transactions
contemplated hereby shall not contravene, violate or conflict with, nor involve
Agent or Lenders in a violation of, any Requirement of Law, including, without
limitation, applicable usury law.

                  (o) ADDITIONAL REQUIREMENTS. Borrower shall have executed and
delivered to QUALCOMM such agreements, waivers and other documents (the "Other
Agreements") as QUALCOMM shall require, and the various payments and other
events shall have been made or occurred, in each case so as to accomplish the
matters described in the Term Sheet under the heading "Additional Requirements"
(exclusive of paragraph 5 under such heading).

                  (p) ADDITIONAL MATTERS, DOCUMENTS OR INFORMATION. Lenders
shall have received each additional document, instrument, legal opinion or item
of information reasonably requested by any Lender, including, without
limitation, a copy of any debt instrument, security agreement or other material
contract to which Borrower or any of Borrower's Subsidiaries may be a party, and
all documents, instruments and other legal matters in connection with the
transactions contemplated by this Agreement and the other Credit Documents, the
Other Agreements shall be reasonably satisfactory in form and substance to
Lenders, and Lenders shall have received such other documents, legal opinions
and other opinions in respect of any aspect or consequence of the transactions
contemplated hereby.

         3.2 CONDITIONS PRECEDENT TO ALL LOANS. The obligation of Lenders to
make any Loan shall be subject to the further conditions precedent that on the
date of such Loan the following statements shall be true:

                  (a) All representations and warranties contained herein and in
the other Credit Documents in effect at such time shall be true and correct in
all material respects with the same effect (except for any representation and
warranty that speaks only as of a specific date, which shall be true and correct
in all material respects as of such date) as though such representations and
warranties had been made on and as of the date of the making of such Loan;

                                      27.
<PAGE>   28
                  (b) No Event of Default or Default has occurred and is
continuing or would result from the making of such Loan; and

                  (c) Each of the conditions precedent set forth in Section 4 of
the Globalstar Bank Agreement as in effect on the date hereof and as in effect
on the date of each Loan to be made hereunder shall have been satisfied.

SECTION 4. REPRESENTATIONS AND WARRANTIES. Borrower represents and warrants to
Agent and each Lender as of the Closing Date as follows, and agrees that each of
said warranties and representations shall be deemed to continue so long as any
of the Tranche A Commitment or Tranche B Commitment shall be available hereunder
or any Loan or other payment Obligations shall remain unpaid or unsatisfied, and
shall apply anew to the making of each Loan:

         4.1 FINANCIAL CONDITION. (a) The consolidated balance sheet of Borrower
as at December 31, 1999 and the related consolidated statements of operations,
of partners' capital and of cash flows for the fiscal period ended on such date,
reported on by Deloitte & Touche LLP and (b) the unaudited consolidated balance
sheet of Borrower as at March 31, 2000 and the related unaudited consolidated
statements of operations and of cash flows for the fiscal quarter ended on such
date, copies of which have heretofore been furnished to each Lender, are
complete and correct in all material respects and present fairly the
consolidated financial condition of Borrower as at such dates, and the
consolidated results of their operations and cash flows for the fiscal periods
then ended. All such financial statements, including the related schedules and
notes thereto, have been prepared in accordance with GAAP applied consistently
throughout the periods involved (except as approved by such accountants and as
disclosed therein and except, with respect to interim reports, for normal
year-end adjustments). Such financial statements, taken together, disclose, in
accordance with GAAP, all material contingent liabilities and liability for
taxes, long-term leases and unusual forward or long-term commitments of Borrower
and its Subsidiaries.

         4.2 EXISTENCE; COMPLIANCE WITH LAW. Each of Borrower and its
Subsidiaries (a) is duly organized, validly existing and in good standing under
the laws of the jurisdiction of its incorporation or organization, (b) has the
partnership or 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, (c) is duly qualified as a
foreign partnership or corporation, as the case may be, 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 and (d) 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.

         4.3 POWER; AUTHORIZATION; ENFORCEABLE OBLIGATIONS. Each of Borrower and
its Subsidiaries has the partnership or corporate, as the case may be, power and
authority and the legal right to make, deliver and perform the Credit Documents
to which it is a party and, in the

                                      28.
<PAGE>   29
case of Borrower, to borrow hereunder and has taken all necessary partnership or
corporate action to authorize the execution, delivery and performance of the
Credit Documents to which it is a party and, in the case of Borrower, the
borrowings hereunder on the terms and conditions 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 borrowings hereunder
or with the execution, delivery, performance, validity or enforceability of the
Credit Documents, other than those which have been obtained or made and are in
full force and effect, including, but not limited to, the license granted on
January 31, 1995 by the Federal Communications Commission authorizing the
construction, launch and operation of the Globalstar System in the United States
of America. This Agreement has been, and each other Credit Document will be,
duly executed and delivered on behalf of each Credit Party (other than Loral)
party thereto. This Agreement constitutes and each other Credit Document, when
executed and delivered will constitute, a legal valid and binding obligation of
each Credit Party party thereto enforceable against such Credit Party 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).

         4.4 NO LEGAL BAR. The execution, delivery and performance of the Credit
Documents to which Borrower or any of its Subsidiaries is a party, the
borrowings hereunder and the use of the proceeds thereof will not violate any
Requirement of Law or any Contractual Obligation applicable to Borrower or of
any of its Subsidiaries, and will not result in, or require, the creation or
imposition of any Lien on any of its or their respective properties or revenues
pursuant to any Requirement of Law or Contractual Obligation.

         4.5 NO DEFAULT. Neither Borrower nor any of its Subsidiaries is in
default under or with respect to any Contractual Obligation in any respect which
could reasonably be expected to have a Material Adverse Effect. No Default or
Event of Default has occurred and is continuing.

         4.6 SOLVENCY.

                           (a) Immediately following the making of each Loan
                  made on the Closing Date and after giving effect to the
                  application of the proceeds thereof, Borrower will be solvent,
                  as defined under applicable creditors' rights and fraudulent
                  conveyance laws.

                           (b) Borrower does not intend to, and does not believe
                  that it or any of its Subsidiaries will, incur debts beyond
                  its ability to pay such debts as they mature, taking into
                  account the timing and amounts of cash to be received by it or
                  any such Subsidiary and the timing and amounts of cash to be
                  payable on or in respect of its Indebtedness or the
                  Indebtedness of any such Subsidiary.

                                      29.
<PAGE>   30
         4.7 FULL DISCLOSURE. All information (other than forward looking
information) heretofore furnished by or on behalf of Borrower to Agent or any
Lender for purposes of or in connection with this Agreement or any transaction
contemplated hereby is, and all such information hereafter furnished by or on
behalf of Borrower to Agent or any Lender will be, true and accurate in all
material respects on the date as of which such information is stated or
certified. All forward looking information heretofore furnished by or on behalf
of Borrower to Agent or any Lender for purposes of or in connection with this
Agreement or any transaction contemplated hereby is, and all such projections
hereafter furnished by or on behalf of Borrower to Agent or any Lender will be,
prepared in good faith based upon reasonable assumptions.

SECTION 5. COVENANTS OF BORROWER.

         5.1 AFFIRMATIVE COVENANTS. So long as any of the Obligations shall
remain unpaid or unsatisfied or any Lender shall have any commitment hereunder,
Borrower shall, and shall cause each of its Subsidiaries, to:

                  (a) COMPLIANCE WITH LAWS, OTHER AGREEMENTS. Except where the
failure to comply would not be reasonably likely to have a Material Adverse
Effect, comply with respect to: (i) their respective certificates of partnership
or incorporation, as applicable, their respective partnership agreements or
bylaws, as applicable, or any applicable laws, rules or regulations, (ii)
orders, writs, decrees or judgments of any court or administrative agency and
(iii) mortgages, indentures, leases, contracts or other agreements or
instruments binding upon Borrower or its Subsidiaries.

                  (b) MAINTENANCE OF PROPERTY; INSURANCE. Keep all property
useful and necessary in its business in good working order and condition;
maintain with financially sound and reputable insurance companies or through a
formal self-insurance program insurance on all its property in at least such
amounts and against at least such risks as are usually insured against in the
same general area by companies engaged in the same or a similar business.

                  (c) CONDUCT OF BUSINESS AND MAINTENANCE OF EXISTENCE. Engage
solely in activities directly related to the Globalstar System and preserve,
renew and keep in full force and effect its partnership or corporate, as the
case may be, existence and maintain all rights, privileges and franchises
necessary or desirable in the normal conduct of its business and comply in all
material respects with all material Contingent Obligations and material
Requirements of Law, except as otherwise expressly permitted by this Agreement;
and obtain and maintain in full force and effect all material consents, licenses
and approvals necessary for the completion and operation of the Globalstar
System and for the continuing operations of Borrower and its Subsidiaries.

                  (d) BOOKS AND RECORDS. Keep proper books of record and account
in which full, true and correct entries in conformity with GAAP and all
Requirements of Law shall be made of all dealings and transactions in relation
to its business and activities.

                  (e) REPORTING REQUIREMENTS. Furnish to Agent for distribution
to each Lender copies of each of the following:

                                      30.
<PAGE>   31
                           (i) As soon as available and in any event within
forty-five (45) days of the end of each of the first three quarterly periods of
each fiscal year of Borrower, the unaudited consolidated balance sheet of
Borrower and its consolidated Subsidiaries as at the end of such quarter and the
related unaudited consolidated statements of operations and cash flows of
Borrower and its consolidated Subsidiaries for such quarter (except as to
statements of cash flow) and the portion of the fiscal year through such date,
setting forth in each case in comparative form the figures for the previous
periods, certificated by a Responsible Officer (subject to normal year-end
adjustments); and

                           (ii) as soon as available, but in any event within 90
days after the end of each fiscal year of Borrower, a copy of the audited
consolidated balance sheet of Borrower and its consolidated Subsidiaries as at
the end of such year and the related audited consolidated statements of
operations, of partners' capital and of cash flows for such year, setting forth
in each case in comparative form the figures for the previous year, reported on
without qualification arising out of the scope of the audit or, after
commencement of operation of the Globalstar System, a "going concern" or like
qualification or exception, by independent certified public accountants of
nationally recognized standing;

all such financial statements to be complete and correct in all material
respects and to be prepared in reasonable detail and in accordance with GAAP
applied consistently throughout the periods reflected therein (except as
approved by such accountants or officer, as the case may be, and disclosed
therein).

                  (f) CERTIFICATES; OTHER INFORMATION. Furnish to Agent for
distribution to each Lender copies of each of the following:

                           (i) concurrently with the delivery of the financial
statements referred to in SECTION 5.1(e)(ii) above, a certificate of the
independent certified public accountants reporting on such financial statements
stating that in making the examination necessary therefor no knowledge was
obtained of any Default or Event of Default, except as specified in such
certificate;

                           (ii) concurrently with the delivery of the financial
statements referred to in SECTION 5.1(e)(i) above, a certificate of a
Responsible Officer (A) stating that, to the best of such officer's knowledge,
Borrower during such period has observed or performed all of its covenants and
other agreements, and satisfied every condition contained in this Agreement and
in the other Credit Documents to be observed, performed or satisfied by it, and
that such officer has obtained no knowledge of any Default or Event of Default
except as specified in such certificate and (B) showing in detail the
calculations supporting such statement in respect of the requirements of SECTION
5.2, if any;

                           (iii) within five days after the same are sent,
copies of all financial statements and reports which are sent to shareholders of
GTL, and within five days after the same are filed, copies of all periodic
reports which Borrower may make to, or file with, the Securities and Exchange
Commission or any successor or analogous Governmental Authority; and

                                      31.
<PAGE>   32
                           (iv) concurrently with delivery of the same to any
institutional lender to Borrower, copies of any updates to Borrower's business
plan; and

                           (v) concurrently with delivery of the same to any
institutional lender to Borrower, copies of such additional financial, operating
and other information so delivered.

                  (g) NOTICES. As soon as practicable, and in any event within
five (5) days of Borrower's obtaining knowledge thereof, give notice (to be
confirmed promptly in writing) to Agent and each Lender:

                           (i) of the occurrence of any Default or Event of
Default;

                           (ii) of Borrower's receipt of notice of default from,
or delivery of a notice of default to, any of the lenders under the Globalstar
Bank Agreement or any Replacement Globalstar Bank Agreement;

                           (iii) of any litigation or proceeding affecting
Borrower or any of its Subsidiaries in which the amount involved is $10,000,000
or more and not covered by insurance; or in which injunctive or similar relief
is sought and which could reasonably be expected to have a Material Adverse
Effect; or

                           (iv) of any material change in the business, assets,
operations or financial or other condition of Borrower or any of its
Subsidiaries.

                  (h) ADDITIONAL SUBSIDIARY GUARANTORS. If any Person shall
become a Subsidiary of Borrower, cause such Subsidiary (other than a Subsidiary
organized or incorporated outside the United States of America) to promptly
thereafter execute and deliver a Subsidiary Guaranty, each of which Guaranties
shall be accompanied by such resolutions, incumbency certificates and legal
opinions as may be reasonably requested by Agent and its counsel.

                  (i) FURTHER ASSURANCES. In addition to the obligations and
documents which this Agreement expressly requires Borrower to execute,
acknowledge, deliver and perform, Borrower shall execute and acknowledge (or
cause to be executed and acknowledged) and deliver to Agent all documents, and
take all actions, that may be reasonably requested by Agent or Lenders from time
to time to confirm the rights created or now or hereafter intended to be created
under the Credit Documents, or otherwise to carry out the purposes of the Credit
Documents and the transactions contemplated hereunder and thereunder.

         5.2 COVENANTS APPLICABLE WHEN NO GLOBALSTAR BANK AGREEMENT. . After
such time as the Globalstar Bank Agreement has been terminated and the financial
covenants set forth therein are not effective and so long as there is no
Replacement Globalstar Bank Agreement, the financial covenants set forth in this
SECTION 5.2 will be deemed to become, and shall remain, effective until a
Replacement Globalstar Bank Agreement has been entered into, provided,

                                      32.
<PAGE>   33
however, that any action taken or obligation incurred by Borrower prior to
effectiveness of the financial covenants set forth in this SECTION 5.2 which was
permitted under the Globalstar Bank Agreement or Replacement Globalstar Bank
Agreement (whether by waiver or otherwise), permitted under the then operative
provisions of this Agreement and not taken or incurred in contemplation of the
termination of the Globalstar Bank Agreement or Replacement Globalstar Bank
Agreement shall not, in and of itself, be considered a violation of any covenant
set forth in SUBSECTIONS 5.2(b) - (i) below.

                  (a) MAINTENANCE OF CONSOLIDATED NET WORTH. On or after the
later of (i) the last day of the first fiscal quarter in which Borrower has
positive Consolidated Net Income and (ii) the last day of the fiscal quarter
ending March 31, 2001 (the first day of such fiscal quarter, the "COMMENCEMENT
DATE"), permit Consolidated Net Worth on the last day of any fiscal quarter to
be less than the sum of (x) the Net Worth Base Amount plus (y) 50% of
Consolidated Net Income, if positive, for the period beginning on the
Commencement Date and ending on the last day of such fiscal quarter.

                  (b) INDEBTEDNESS. Create, incur, assume or suffer to exist any
Indebtedness, except:

                           (i) Subordinated Indebtedness;

                           (ii) unsecured Indebtedness (including Indebtedness
consisting of performance and other similar bonds and reimbursement obligations)
incurred in the ordinary course of business consistent with prior practice
securing the performance of contracted, franchise or license obligations of
Borrower or any of its Subsidiaries, or in respect of commercial and standby
letters of credit issued by any financial institution to secure contractual
commitments to its customers;

                           (iii) Indebtedness owed by a Wholly Owned Subsidiary
Guarantor to another Wholly Owned Subsidiary that is a Subsidiary Guarantor; and
Indebtedness owed to Borrower by a Wholly Owned Subsidiary that is a Subsidiary
Guarantor; and Indebtedness owed by Borrower to a Wholly Owned Subsidiary that
is a Subsidiary Guarantor or a Subsidiary organized or incorporated outside the
United States of America;

                           (iv) unsecured Indebtedness which is not Subordinated
Indebtedness of Borrower and its Subsidiaries in an aggregate principal amount
not to exceed $50,000,000 outstanding at any time;

                           (v) vendor financing in respect of the deferred
purchase price of assets acquired from any vendor to Borrower or any of its
Subsidiaries and any refinancing, replacement or renewal thereof with any vendor
to Borrower or any of its Subsidiaries;

                           (vi) Additional Buildout Indebtedness;

                           (vii) Indebtedness of a Subsidiary Guarantor

                                      33.
<PAGE>   34
]which is acquired after the Closing Date (as defined in the Globalstar Bank
Agreement) which Indebtedness exists at the time of such acquisition and is not
created in anticipation of such acquisition;

                           (viii) Indebtedness consisting of obligations under
Financing Leases of Borrower incurred to finance the acquisition (whether
through the direct purchase of assets or the Equity Interests of the Person
owning such fixed or capital assets) or improvement of fixed or capital assets
in an aggregate principal amount not exceeding $100,000,000 at any time
outstanding, provided that (x) such Indebtedness is incurred within 180 days
after the acquisition of such asset or the completion of such improvement and
(y) the amount of such Indebtedness does not exceed, at the time initially
incurred, 90% of the fair market value of the asset so acquired or improved;

                           (ix) Indebtedness to finance the working capital
requirements of Borrower and its Subsidiaries in an aggregate principal amount
not to exceed $100,000,000 at any time outstanding;

                           (x) Indebtedness in existence on the date hereof and
listed on SCHEDULE 5.2(b)(x);

                           (xi) Indebtedness under the Globalstar Bank Agreement
or the Replacement Globalstar Bank Agreement; and

                           (xii) Indebtedness under Hedge Agreements entered
into not for the purpose of speculation.

         For purposes of determining compliance with this SUBSECTION 5.2(B), in
the event that an item of Indebtedness meets the criteria of more than one of
the types of Indebtedness Borrower and its Subsidiaries are permitted to incur,
Borrower or such Subsidiary, as the case may be, shall have the right, in its
sole discretion, to classify such item of Indebtedness at the time of its
incurrence and shall only be required to include the amount and type of such
Indebtedness under the clause permitting the Indebtedness so classified.

                  (c) LIMITATION ON LIENS. Create, incur, assume or suffer to
exist any Lien upon any of its property, assets or revenues, whether now owned
or hereafter acquired, except:

                           (i) Liens for taxes not yet due or which are being
contested in good faith and by appropriate proceedings if adequate reserves with
respect thereto are maintained on the books of Borrower or the appropriate
Subsidiary, as the case may be, in accordance with GAAP;

                           (ii) carriers', warehousemen's, mechanics',
materialmen's, repairmen's or other like Liens arising in the ordinary course of
business which are not overdue for a period of more than 60 days or which are
being contested in good faith and by appropriate proceedings;

                                      34.
<PAGE>   35
                           (iii) pledges or deposits in connection with
workmen's compensation, unemployment insurance and other social security
legislation and deposits securing liabilities to insurance carriers under
insurance and self-insurance agreements;

                           (iv) deposits to secure the performance of bids,
trade contracts (other than for borrowed money), leases, statutory obligations,
surety and appeal bonds, performance bonds and other obligations of a like
nature incurred in the ordinary course of business;

                           (v) easements, rights-of-way, restrictions and other
Liens incurred in the ordinary course of business which do not secure
Indebtedness and which do not in any case materially detract from the value of
the property subject thereto or materially interfere with the ordinary conduct
of the business of Borrower or any Subsidiaries;

                           (vi) Liens upon real and/or personal property, which
property was acquired after the Closing Date by Borrower or any Subsidiary in
the ordinary course of business, each of which Liens was created solely for the
purpose of securing Indebtedness incurred for the purpose of financing such
acquisition or for the purpose of securing any refinancings or renewals thereof;
provided, that no such Lien shall extend to or cover any property of Borrower or
any such Subsidiary other than the respective property so acquired and
improvements thereon, and the principal amount of Indebtedness secured by any
such Lien shall at no time exceed 100% of the fair market value (as determined
in good faith by the board of directors of Borrower) of the respective property
at the time it was acquired,

                           (vii) Liens created pursuant to subsection 2.10(f) of
the Globalstar Bank Agreement as in effect on the date hereof;

                           (viii) Liens which secure Additional Buildout
Indebtedness;

                           (ix) Liens securing Indebtedness of Borrower
permitted by SUBSECTION 5.2(b)(xiii) incurred to finance the acquisition of
fixed or capital assets, provided that (A) such Liens shall be created
substantially simultaneously with the acquisition of such fixed or capital
assets, (B) such Liens do not at any time encumber any property other than the
property financed by such Indebtedness, (C) the amount of Indebtedness secured
thereby is not increased and (D) the principal amount of Indebtedness secured by
any such Lien shall at no time exceed the original purchase price of such
property;

                           (x) Liens incurred in the ordinary course of business
with respect to obligations (other than Indebtedness) that do not exceed
$10,000,000 at any time and that do not materially detract from the value of the
property or materially impair the use thereof in the operation of their
businesses;

                           (xi) Liens securing vendor financing permitted under
SUBSECTION 5.2(b)(v), provided that (A) such Liens shall be initially created
substantially simultaneously with the acquisition of assets from the relevant
vendors, (B) such Liens do not at

                                      35.
<PAGE>   36
any time encumber any property other than such assets and any other assets
purchased from or financed by the relevant vendors, (C) the amount of vendor
financing secured thereby is not increased and (D) the principal amount of
vendor financing secured by any such Lien shall at no time exceed the original
purchase price of such assets; and

                           (xii) Liens securing any Indebtedness created under a
Replacement Globalstar Bank Agreement, provided that any such Lien equally and
ratably secures the Obligations on terms and conditions reasonably satisfactory
to Agent and Requisite Lenders.

                  (d) LIMITATION ON FUNDAMENTAL CHANGES.

                           (i) Enter into any transaction of merger or
consolidation or amalgamation, or liquidate, wind up or dissolve itself (or
suffer any liquidation or dissolution) except that any Subsidiary may be merged
or consolidated (i) with or into Borrower (provided that Borrower shall be the
continuing or surviving Person) or (ii) with or into any one or more Wholly
Owned Subsidiaries (including any entity that, after giving effect to such
merger or consolidation, is a Wholly Owned Subsidiary) (provided that if any
Subsidiary which is a party to any such merger or consolidation is a Subsidiary
Guarantor, then the continuing or surviving corporation must be a Subsidiary
Guarantor); or

                           (ii) convey, sell, lease, transfer or otherwise
dispose of any assets in a transaction or series of related transactions, except
that:

                                    (A) any Subsidiary may sell, lease, transfer
or otherwise dispose of any or all of its assets (upon voluntary liquidation or
otherwise) to Borrower or any Subsidiary Guarantor;

                                    (B) Borrower or any Subsidiary may sell,
lease, transfer or otherwise dispose of inventory in the ordinary course of
business;

                                    (C) Borrower or any Subsidiary may sell,
transfer or otherwise dispose of Cash Equivalents in exchange for a comparable
amount of cash and/or Cash Equivalents;

                                    (D) the sale of assets set forth on SCHEDULE
5.2(d)(ii)(D);

                                    (E) Borrower or any Subsidiary may sell or
otherwise dispose of obsolete or worn out property in the ordinary course of
business having an aggregate value not to exceed $5,000,000 for all such
transactions; and

                                    (F) any transaction permitted by SUBSECTION
6.7 of the Globalstar Bank Agreement as in effect on the date hereof.

Notwithstanding the foregoing, Borrower may transfer assets to Subsidiary
Guarantors and may

                                      36.
<PAGE>   37
transfer the Service Provider Agreements to Subsidiaries organized or
incorporated outside the United States of America.

Notwithstanding anything in this Agreement to the contrary, and whether or not
the Globalstar Bank Agreement or the Replacement Globalstar Bank Agreement shall
be in effect, no obligation of prepayment under the Globalstar Bank Agreement,
the Replacement Globalstar Bank Agreement or any other credit facility shall
arise as a result of any conveyance, sale, transfer or other disposition of
assets contemplated in this SUBSECTION 5.2(d).

                           (e) LIMITATION ON RESTRICTED PAYMENTS. Declare or
make any distributions on, or make any payment on account of or set apart assets
for a sinking or other analogous fund for the purchase, redemption, retirement
or other acquisition of, any Equity Interests of Borrower, whether now or
hereafter outstanding, or make any other distribution in respect thereof, either
directly or indirectly, whether in cash or property or in obligations of
Borrower or any Subsidiary, or permit any Subsidiary to make any payment on
account of, or purchase or otherwise acquire, any Equity Interests of Borrower
or any Subsidiary from any Person or pay any interest on Borrower's subordinated
obligations described in the definition of "Partner Guarantor Fee Agreement"
(all of the foregoing shall collectively be referred to as "RESTRICTED
PAYMENTS"), except that so long as no Default or Event of Default (other than
with respect to subclauses (ii), (iv), (v), (vi) or (vii)) below has occurred
and is continuing or would result from the making of such Restricted Payment,
Borrower may make a Restricted Payment (i) if the sum of (A) such Restricted
Payment plus (B) the Restricted Payments made from the Closing Date (as defined
in the Globalstar Bank Agreement) through any date of determination, shall not
exceed an amount equal to 50% of the aggregate Consolidated Net Income from July
1, 1997 through the end of the fiscal quarter immediately preceding such date of
determination, (ii) consisting of Qualified Equity Interests, (iii) in respect
of Preferred Equity Interests, (iv) with respect to the repurchase of any shares
of its Equity Interests or options to acquire its Equity Interests (or equity
interests in a Partner) from Persons who were formerly officers or employees of
Borrower; provided, however, that the aggregate amount of all such repurchases
pursuant to this clause (iv) shall not exceed the sum of $2,200,000 plus the
aggregate cash proceeds received by Borrower since the Closing Date from the
sale of its Equity Interests in GTL or options to acquire GTL's Equity Interests
to members, officers, managers and employees of Borrower or any of its
Subsidiaries, (v) so long as Borrower is treated as a partnership for U.S.
federal income tax purposes, with respect to distributions in respect of
members' or partners' income tax liability with respect to Borrower in an amount
not to exceed the Tax Amount (as defined below), (vi) with respect to
distributions to GTL to pay GTL's ordinary and reasonable operating expenses
related to its investment in Borrower, (vii) consisting of an exchange for, or
out of the proceeds of the substantially concurrent sale of or capital
contribution in respect of common Equity Interests of Borrower, (vii) contribute
its investment in Globaltel Russia to any Subsidiary, (viii) distributions
described in Schedule 5.2(e) and (ix) so long as the aggregate amount of all
Restricted Payments made pursuant to this clause subsequent to the Closing Date
(as defined in the Globalstar Bank Agreement) shall not exceed $10,000,000. The
value of any distributions made other than of cash and the value of any
Investments made other than in cash shall be the value determined in good faith
by the General Partners' Committee of Borrower and evidenced by a resolution of
such Committee.

                                      37.
<PAGE>   38
         For purposes of this SUBSECTION 5.2(e), "TAX AMOUNT" means, with
respect to any year, an amount not to exceed the sum of the ordinary income from
trade or business activities and other items of income net of any loss or
deduction reported by Borrower for that year for United States federal income
tax purposes multiplied by a percentage equal to the sum of (a) the highest
applicable federal corporation income tax rate for that year (expressed as a
percentage) plus (b) 8% multiplied by the excess of 100% over the highest
applicable federal corporate income tax for that year (expressed as a
percentage).

         Any Restricted Payment made pursuant to clauses (ii) through (ix) of
the second-preceding paragraph shall be excluded from the calculation of the
aggregate amount of Restricted Payments made from the Closing Date.

                  (f) LIMITATION ON OPTIONAL PAYMENTS AND MODIFICATIONS OF
SUBORDINATED INDEBTEDNESS AND OTHER DEBT INSTRUMENTS. (i) Make any optional
payment or prepayment prior to scheduled maturity on or optional redemption or
purchase prior to scheduled maturity of any Subordinated Indebtedness or other
Indebtedness (other than the Loans, the Loans (as defined in the Globalstar Bank
Agreement) and the Additional Buildout Indebtedness), provided that this clause
(i) shall not prohibit Borrower from (A) consummating any such transactions if
the sole consideration therefor is Qualified Equity Interests, or (B) replacing
the Globalstar Bank Agreement with a Replacement Globalstar Bank Agreement, or
(ii) amend, modify or change, or consent or agree to any amendment, modification
or change to any of the terms of, any Subordinated Indebtedness or other
Indebtedness (other than, any such amendment, modification or change which would
extend the maturity or reduce the amount of any payment of principal thereof or
which would reduce the rate or extend the date for payment of interest thereon),
provided that this subsection shall not prohibit the refinancing of any vendor
financing permitted under subsection 5.2(b)(v).

                  (g) AFFILIATES. Enter into any transaction, including, without
limitation, the purchase, sale or exchange of property or the rendering of any
services, with any Affiliate (other than a Wholly Owned Subsidiary) or enter
into, assume or suffer to exist any employment or consulting contract with any
such Affiliate, except any transaction or contract disclosed on SCHEDULE 5.2(g)
(including any modification or amendment to any such transaction or contract
that, in the reasonable judgment of Borrower, is no less favorable to Borrower
than such transaction or contract) and any transaction or contract which is upon
terms no less favorable to Borrower or its Subsidiaries than those that would
obtain in a comparable arms'-length transaction with a Person not an Affiliate
of Borrower or such Subsidiary; provided, however, that this subsection shall
not prohibit (i) the Partner Guarantee Fee Arrangement (as defined in the
Globalstar Bank Agreement as in effect on the date hereof), (ii) employee
compensation arrangements entered into in the ordinary course of business and
approved by the general partners' committee (or equivalent body) of Borrower,
(iii) transactions solely between or among Borrower and its Subsidiary
Guarantors, (iv) Restricted Payments (as defined in the Globalstar Bank
Agreement and permitted by SUBSECTION 6.6 thereof as in effect on the date
hereof), (v) Investments by an Affiliate or Related Person of Borrower in the
Qualified Equity Interests and Preferred Equity Interests of Borrower or any
Subsidiary Guarantor, and (vi) an Affiliate or Related Person of Borrower acting
as agent for the placement of acquisition of launch

                                      38.
<PAGE>   39
services or insurance on behalf of Borrower or any Subsidiary Guarantors. For
purposes of the foregoing sentence, a "Related Person" of any Person means any
other Person directly or indirectly owning (x) 10% or more of the outstanding
common equity of such Person (or, in the case of a Person that is not a
corporation, 10% or more of the equity interests of such Person) or (y) 10% or
more of the combined voting power of the voting equity interests of such Person.
Notwithstanding the foregoing, any agreement by and between any Affiliate of
Borrower and one or more lenders under the Globalstar Bank Agreement or the
Replacement Globalstar Bank Agreement by which the lenders thereunder shall
agree to amend, waive conditions or other terms, forebear under or otherwise
modify the Globalstar Bank Agreement or the Replacement Globalstar Agreement, as
applicable, shall be deemed a transaction between Borrower and such Affiliate
and shall, unless approved by Requisite Lenders, be prohibited hereunder

                  (h) RESTRICTIONS ON SUBSIDIARIES. Permit any Wholly Owned
Subsidiary to enter into any agreement which prohibits or restricts the ability
of such Subsidiary to (i) pay dividends or make any other distributions on its
Equity Interests or any other interest or participation in, or measured by, its
profits, owned by Borrower or any of its Subsidiaries, or pay any Indebtedness
owed to Borrower or any of its Subsidiaries, (ii) make loans or advances to
Borrower or any of its Subsidiaries or (iii) transfer any of its properties or
assets to Borrower or any of its Wholly Owned Subsidiaries, except for such
encumbrances or restrictions existing under or by reason of: (A) the terms of
this Agreement and the terms of Additional Buildout Indebtedness provided that
such terms are no more restrictive than those set forth in this Agreement, (B)
the Globalstar Bank Agreement or any Replacement Globalstar Bank Agreement,
provided that the terms and conditions of any such prohibitions or restrictions
in the Replacement Globalstar Bank Agreement are not more restrictive than those
contained in the Globalstar Bank Agreement, (C) applicable law, (D) customary
non-assignment provisions entered into in the ordinary course of business and
consistent with past practices, (E) the terms of purchase money obligations for
property acquired in the ordinary course of business, but only to the extent
that such purchase money obligations restrict or prohibit the transfer of the
property so acquired and (F) any encumbrance or restriction existing under any
agreement which refinances or replaces the agreements for Additional Buildout
Indebtedness described in clause (A); provided, that the terms and conditions of
any such encumbrances or restrictions contained in any such agreement referred
to in this clause (F) constitute no greater encumbrance or restriction on the
ability of any Subsidiary to pay dividends or make distributions, make loans or
advances or transfer properties or assets other than those under or pursuant to
the agreement evidencing the Indebtedness or obligations refinanced.

                  (i) RESTRICTIVE AGREEMENTS. Enter into or with any Person any
agreement which directly impairs the ability of Borrower or its Subsidiaries to
perform any of their obligations under the Credit Documents

                  (j) LIMITATION ON CONTINGENT OBLIGATIONS. Create, incur,
assume or suffer to exist any Contingent Obligation, except:

                           (a) the Subsidiary Guaranties;

                                      39.
<PAGE>   40
                           (b) the Borrower or any Subsidiary Guarantor may
guarantee the obligations of the Borrower or any Subsidiary Guarantor which are
otherwise permitted under the Credit Documents;

                           (c) Subsidiary Guarantors may guarantee Additional
Buildout Indebtedness of the Borrower; and

                           (d) Subsidiaries may guarantee payment of the
Obligations.

SECTION 6. EVENTS OF DEFAULT.

         6.1 EVENTS OF DEFAULT. The occurrence of any one or more of the
following events shall constitute an Event of Default:

                  (a) Borrower shall fail to pay when due any principal of any
Loan; or Borrower shall fail to pay when due any interest, fees or other amounts
payable under this Agreement and any such failure shall continue for five (5)
days; or

                  (b) Any representation or warranty made by Borrower, any
Subsidiary of Borrower (or any of their officers), under or in connection with
this Agreement or any other Credit Document shall prove to have been incorrect
in any material respect when made or deemed made; or

                  (c) Borrower or any Subsidiary of Borrower shall fail to
perform or observe any other term, covenant or agreement on its part to be
performed or observed and contained in this Agreement or any other Credit
Document and such failure shall continue for ten (10) days after Borrower has
knowledge of such failure (provided, however, that the breach of SECTIONS
5.1(c), 5.1(g) AND 5.2 (if applicable) hereof shall, immediately upon any such
breach, constitute an Event of Default); or

                  (d) Borrower or any of its Subsidiaries is in default in the
performance of or compliance with any term of any Other Globalstar Indebtedness
Agreement, and as a consequence of such default such Indebtedness has become, or
has been declared, due and payable before its stated maturity or before its
regularly scheduled dates of payment; or

                  (e) Borrower or any of its Subsidiaries (i) defaults (whether
as primary obligor or as guarantor or surety) in any payment of principal of or
premium or make-whole amount or interest on any Indebtedness under the Other
Globalstar Indebtedness Agreements beyond any period of grace provided with
respect thereto and such default has continued for at least 31 days or (ii)
fails to perform or observe any other agreement, term or condition contained in
any Other Globalstar Indebtedness Agreements beyond any period of grace provided
with respect thereto and such default has continued for at least 61 days and the
effect of such failure or other event is to cause, or to permit the holder or
holders of such Indebtedness, or a trustee on behalf of such holder or holders
to cause, such Indebtedness to become due (or to be repurchased by Borrower or
any of its Subsidiaries) prior to any stated maturity; or

                                      40.
<PAGE>   41
                  (f) Borrower or any of its Subsidiaries is in default in the
performance of or compliance with any term of any evidence of any Indebtedness,
or of any mortgage, indenture or other agreement relating thereto or any other
condition exists, and as a consequence of such default or condition such
Indebtedness has become, or has been declared, due and payable before its stated
maturity or before its regularly scheduled dates of payment; provided that the
aggregate amount of all Indebtedness with respect to which one or more of the
conditions or events referred to in the immediately preceding clause of this
sentence shall be applicable exceeds $25,000,000; or

                  (g) Borrower or any of its Subsidiaries defaults (whether as
primary obligor or as guarantor or surety) in any payment under any of the
Globalstar Agreements; or

                  (h) An Event of Default shall have occurred under the
Guaranty, an appropriate demand for payment shall have been made thereunder and
Loral shall have failed to make payment in respect thereof within five (5) days
of such demand;

                  (i) Borrower, any of Borrower's Subsidiaries or any of
Borrower's general partners shall (i) apply for or consent to the appointment of
a receiver, trustee, liquidator or custodian of itself or of all or a
substantial part of its property, (ii) be unable, or admit in writing its
inability, to pay its debts generally as they mature, (iii) make a general
assignment for the benefit of its or any of its creditors, (iv) be dissolved or
liquidated in full or in part, (v) become insolvent (as such term may be defined
or interpreted under any applicable statute), (vi) commence a voluntary case or
other proceeding seeking liquidation, reorganization or other relief with
respect to itself or its debts under any bankruptcy, insolvency or other similar
law now or hereafter in effect or consent to any such relief or to the
appointment of or taking possession of its property by any official in an
involuntary case or other proceeding commenced against it, or (vi) take any
action for the purpose of effecting any of the foregoing; or

                  (j) Proceedings for the appointment of a receiver, trustee,
liquidator or custodian of Borrower, any of Borrower's Subsidiaries or any of
Borrower's general partners or of all or a substantial part of any of their
respective property, or an involuntary case or other proceedings seeking
liquidation, reorganization or other relief with respect to Borrower or any of
their Subsidiaries, under any bankruptcy, insolvency or other similar law now or
hereafter in effect shall be commenced and an order for relief entered or such
proceeding shall not be dismissed or discharged within forty-five (45) days of
commencement; or

                  (k) Borrower, any of Borrower's Subsidiaries or any of
Borrower's general partners shall fail to pay and discharge any judgment or
order, or levy of any attachment, execution or other process against its assets
and such judgment, order, levy or other process shall be in excess of
$10,000,000 and remain undischarged, unvacated, unbonded or unstayed for a
period of thirty (30) days or in any event five (5) days prior to the time of
any proposed sale under any such judgment or levy; or

                  (l) If any Credit Document shall for any reason be
unenforceable or cease to be in full force and effect or shall cease to give
Lenders the rights,

                                      41.
<PAGE>   42
powers and privileges purported to be created thereby in favor of Lenders, or
Borrower or any of its Subsidiaries shall fail to perform or observe any term,
covenant, condition, agreement or obligation on its part to be performed or
observed pursuant thereto and such failure shall continue for ten (10) days
after such Person has knowledge of such failure or Borrower or any of its
Subsidiaries party to any of such foregoing documents shall deny or disaffirm
such Person's obligations thereunder; or

                  (m) Borrower shall be required to provide a Lien in favor of
the indenture trustee under its 11 -1/2% Senior Notes due 2005 and shall not
provide a commensurate Lien in favor of Agent or Borrower shall incur any other
Lien in violation of such indenture as amended or, if such indenture is not then
effective, as such indenture was in effect on the date of termination or
defeasance of such indenture.

         6.2 REMEDIES. Immediately and without notice upon the occurrence of an
Event of Default specified in SECTION 6.1(h), 6.1(i) or SECTION 6.1(k) of this
Agreement, or, at the option of Requisite Lenders, upon the occurrence of any
other Event of Default, (i) all amounts and obligations owed to Agent and
Lenders pursuant to this Agreement and the other Credit Documents shall
immediately become due and payable and (ii) the obligation of Lenders to make
any Loan under this Agreement or the other Credit Documents and all commitments
hereunder shall be terminated, all without presentment, demand, protest or
notice of any kind, all of which are hereby expressly waived and (iii) without
the expiration of any other period of grace, Agent or any Lender may immediately
enforce payment of the amounts owed it hereunder and exercise any and all other
rights and remedies granted to it by this Agreement or any of the other Credit
Documents or at law, in equity or otherwise.

         6.3 UNMATURED EVENTS OF DEFAULT. Upon the occurrence of any Default,
the obligation of Lenders to make any Loans under this Agreement or the other
Credit Documents shall be suspended until such event is either waived by
Requisite Lenders or, to the extent allowed hereunder, cured by Borrower.

         6.4 PAYMENT OF SUBORDINATED INDEBTEDNESS. Upon the occurrence and
during the continuance of an Event of Default, Lenders, or Agent, at the request
of Requisite Lenders, on behalf of Lenders, may deliver to Borrower written
notice, or telephonic notice promptly confirmed in writing, directing Borrower
to make no further payments on account of any Subordinated Indebtedness.
Immediately upon receipt of such notice, Borrower shall cease making and shall
make no further payments of any nature whatsoever on account of such
Subordinated Indebtedness (except as otherwise permitted by the terms of
subordination of such Subordinated Indebtedness), whether such payments are owed
to the holder of such Subordinated Indebtedness or to some other Person, unless
and until Requisite Lenders have waived such Event of Default in writing or
shall have otherwise consented to such payment in writing in advance, such
consent being at Requisite Lenders' sole and absolute discretion.

SECTION 7. AGENT.

         7.1 APPOINTMENT OF QUALCOMM AS AGENT. Lenders hereby designate and
appoint QUALCOMM as Agent to act as specified under this Agreement and the other
Credit

                                      42.
<PAGE>   43
Documents. Each Lender hereby irrevocably authorizes Agent to take such action
on its behalf under the provisions of this Agreement and the other Credit
Documents and to exercise such powers and perform such duties as are expressly
delegated to Agent by the terms of this Agreement or any other Credit Document,
together with such other powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary elsewhere in this Agreement or any
other Credit Document, Agent shall not have any duties or responsibilities,
except those expressly set forth herein or therein, or any fiduciary
relationship with any Lender, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Credit Document or otherwise exist against Agent.

         7.2 DELEGATION OF DUTIES BY AGENT. Agent may execute any of its duties
under this Agreement by or through agents, employees or attorneys-in-fact and
shall be entitled to advice of counsel concerning all matters pertaining to such
duties. Agent shall not be responsible for the negligence or misconduct of any
agent or attorney-in-fact that it selects with reasonable care.

         7.3 LIABILITY OF AGENT. None of Agent-Related Persons (defined below)
shall (a) be liable for any action taken or omitted to be taken by any of them
under or in connection with this Agreement (except for its own gross negligence
or willful misconduct), or (b) be responsible or liable for the validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement or
any Credit Document. No Agent-Related Person shall be under any obligation to
ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement, or to inspect the
properties, books or records of Borrower. "Agent-Related Persons" shall mean
Agent and any successor Agent, together with their respective Affiliates, and
the employees, agents and attorneys-in-fact of such persons.

         7.4 RELIANCE BY AGENT. Agent shall be entitled to rely, and shall be
fully protected in relying, upon any writing, resolution, notice, consent,
certificate, affidavit, letter, telegram, facsimile, telex or telephone message,
statement or other document or conversation believed by it to be genuine and
correct and to have been signed, sent or made by the proper Person or Persons,
and upon advice and statements of legal counsel (including counsel to Borrower),
independent accountants and other experts selected by Agent.

         7.5 NON-RELIANCE BY LENDERS. Each Lender expressly acknowledges that
none of Agent-Related Persons has made any representation or warranty to it and
that no act by Agent hereafter taken shall be deemed to constitute any
representation or warranty by Agent to such Lender. Agent shall not have any
duty or responsibility to provide to any Lender any credit or other information
concerning the business, prospects, operations, property, financial and other
condition or creditworthiness of Borrower which may come into the possession of
any Agent-Related Persons. Agent shall not be responsible to any Lender for the
execution, effectiveness, genuineness, validity, enforceability, collectibility
or sufficiency of this Agreement or for any representations or warranties,
recitals or statements made herein or made in any written or oral statements, or
in any financial or other statements, instruments, reports or certificates or
any other documents furnished or made by Agent to Lenders or by or on behalf of
Borrower to Agent or any Lender in connection with the Credit Documents or the
transactions

                                      43.
<PAGE>   44
contemplated thereby or for the financial condition or business affairs of
Borrower or any Person liable for payment of the Obligations, nor shall Agent be
required to ascertain or inquire as to the performance or observance of any of
the terms, conditions, provisions, covenants or agreements contained in any of
the Credit Documents or as to the use of proceeds of the Loans or as to the
existence or possible existence of any Event of Default or Default.

         7.6 INDEMNIFICATION. Whether or not the transactions contemplated
hereby are consummated, Lenders shall indemnify upon demand Agent-Related
Persons (to the extent not reimbursed by or on behalf of Borrower and without
limiting the obligation of Borrower to do so) ratably from and against any and
all liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses and disbursements of any kind whatsoever which may at any
time (including at any time following the repayment of the Loans or the
termination or the resignation of the related Agent) be imposed on, incurred by
or asserted against any such Person in any way relating to or arising out of
this Agreement or any of the other Credit Documents or the transactions
contemplated hereby or thereby or any action taken or omitted by any such Person
under or in connection with any of the foregoing; provided, however, that no
Lender shall be liable for the payment to Agent-Related Persons of any portion
of such liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from such Person's
gross negligence or willful misconduct. Without limitation of the foregoing,
each Lender shall reimburse Agent upon demand for its ratable share of any costs
or other out-of-pocket expenses (including reasonable attorneys' expenses and
disbursements) incurred by Agent in connection with the preparation, execution,
administration, modification, amendment or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice in respect of
rights or responsibilities under, this Agreement or any other Credit Document to
the extent that Agent has not previously been reimbursed for such expenses by or
on behalf of Borrower. The obligations of Lenders in this SECTION 7.6 shall
survive the repayment of all Obligations.

         7.7 SUCCESSOR AGENT. Agent may resign as Agent upon sixty (60) days'
notice to Lenders. If Agent shall resign as Agent under this Agreement and the
other Credit Documents, then Lenders shall appoint a successor agent for
Lenders. No resignation shall be effective until acceptance of the appointment
of a successor Agent. Such successor agent shall succeed to the rights, powers
and duties of Agent, and the term "Agent" shall mean such successor agent
effective upon its appointment, and the former Agent's rights, powers and duties
as Agent shall be terminated, without any other or further act or deed on the
part of such former Agent or any of the parties to this Agreement. After any
retiring Agent's resignation as Agent, the provisions of this SECTION 7 shall
inure to its benefit as to actions taken or omitted to be taken by it while it
was Agent under this Agreement and the other Credit Documents.

SECTION 8. MISCELLANEOUS.

         8.1 AMENDMENTS. No amendment or waiver of any provision of this
Agreement or any of the other Credit Documents, nor consent to any departure by
Borrower therefrom, shall in any event be effective unless the same shall be in
writing and signed by Requisite Lenders and acknowledged by Agent, and then such
waiver or consent shall be effective only in the specific

                                      44.
<PAGE>   45
instance and for the specific purpose for which given; provided, however, that
no such amendment, waiver or consent shall, unless in writing and signed by all
Lenders (other than any Lender which is in default of its obligations hereunder)
and Borrower and acknowledged by Agent, do any of the following:

                  (a) postpone or delay any date fixed by this Agreement or any
other Credit Document for any payment or prepayment of amounts due to Lenders
hereunder or under any other Credit Document;

                  (b) reduce the amount of any amounts payable to Lenders (or
any of them) hereunder or under any other Credit Document;

                  (c) change the percentage of the Aggregate Commitment, the
Aggregate Tranche A Commitment or the Aggregate Tranche B Commitment or of the
aggregate unpaid principal amount of the Loans, the Tranche A Loans or the
Tranche B Loans, as applicable, which is required for Lenders, Tranche A Lenders
or Tranche B Lenders, as applicable, to take any action hereunder;

                  (d) amend, terminate or release the Guaranty; or

                  (e) amend this SECTION 8.1 or any provision herein expressly
providing for consent or other action by all Lenders, all Tranche A Lenders or
all Tranche B Lenders;

provided further, that no amendment or waiver shall, unless in writing and
signed by Agent in addition to Requisite Lenders or all Lenders, as applicable,
affect the rights or duties of Agent under this Agreement or any other Credit
Document.

         8.2 NOTICES, ETC. Except as to those notices and other communications
which are expressly authorized to be sent telephonically, all notices and other
communications provided for hereunder shall be in writing (including facsimile
communication) and sent by certified mail, overnight courier service, telecopied
or delivered, and addressed to Borrower, Agent or such Lender at its address
shown below, or at such other address as it may, by written notice received by
the other parties to this Agreement, have designated as its address for such
purposes. Agent or any Lender giving any waiver, consent or notice to, or making
any request upon, Borrower hereunder shall promptly notify the other parties to
this Agreement at the addresses set forth below:

                  BORROWER                  Globalstar, L.P.
                                            3200 Zanker Boulevard, Building #260
                                            San Jose, California 95134

                                            Attention: Vice President - Finance
                                            Fax No.: (713) 780-0156

                                            Copy To:

                                      45.
<PAGE>   46
                                   Loral General Partner, Inc.
                                   600 Third Avenue
                                   New York, NY 10016

                                   Attention: General Counsel
                                   Fax No.: (212) 338 5320

                  AGENT            QUALCOMM Incorporated
                                   5755 Morehouse Drive.
                                   San Diego, California 92121

                                   Attention:  Vice President - Customer Finance
                                   Fax No.: (619) 658-4203

                                   With Copy to: General Counsel

                  LENDERS          QUALCOMM Incorporated
                                   At the address set forth for Agent

The address for notices for Persons which subsequently become Lenders hereunder
shall be as noted in the assignment and acceptance documentation to which such
Person becomes a party. Except as set forth below, all such notices and
communications shall, when mailed or telecopied, be effective, if deposited in
the mails, two (2) Business Days after deposit in the mails, or if telecopied,
upon being telecopied, with receipt telephonically confirmed by sender,
respectively, addressed as aforesaid; provided, however, that notices to Lenders
or Agent pursuant to the provisions of SECTION 2 of this Agreement shall not be
effective, as of a given Business Day, unless actually received by Lenders or
Agent or both, as applicable, prior to 1:00 p.m. New York time, on said Business
Day. Notices given to Lenders or Agent pursuant to the provisions of SECTION 2
of this Agreement which are received after 1:00 p.m. New York time on a Business
Day shall be considered effective as of the next succeeding Business Day. Each
of such notices specified in SECTION 2 of this Agreement shall be given by
telephone, facsimile or delivery of such notice. Neither Lenders nor Agent shall
incur any liability to Borrower in acting upon any telephone or facsimile notice
referred to in SECTION 2 of this Agreement which Lenders or Agent believe in
good faith to have been given by a duly authorized officer or other person
authorized to borrow on behalf of Borrower. Each such telephonic or facsimile
notice shall be irrevocable and binding on Borrower.

         8.3 NO WAIVER; REMEDIES. No failure on the part of Agent or Lenders to
exercise, and no delay in exercising, any right under any Credit Document shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right under any Credit Document preclude any other or further exercise thereof
or the exercise of any other right. The remedies provided in the Credit
Documents are cumulative and not exclusive of any remedies provided by law.

         8.4 COSTS AND EXPENSES. Each of Borrower, Agent and each Lender shall
bear its

                                      46.
<PAGE>   47
own fees, costs and expenses incurred by it in connection with the negotiation,
preparation, execution, delivery and consummation of, and the making of the
initial Loans under, this Agreement and the other Credit Documents; provided,
however, that Borrower agrees to pay Agent or Lenders, as the case may be, on
demand (i) all reasonable fees and expenses, including attorneys' fees, incurred
by Agent or Lenders in connection with the negotiation of and/or the preparation
of amendments to and waivers under the Credit Documents requested by Borrower
and (ii) all costs and expenses, if any (including counsel fees and expenses),
incurred by Agent and Lenders in connection with the enforcement of the Credit
Documents and the other documents to be delivered under the Credit Documents.

         8.5      RIGHT OF SET-OFF.

                  (a) Upon the occurrence and during the continuance of any
Event of Default, under SUBSECTION 6.1(a), (i) OR (j) hereof, Agent and Lenders
are hereby authorized at any time and from time to time, to the fullest extent
permitted by law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held and other indebtedness at
any time owing by Lenders to or for the credit or the account of Borrower
against any and all of the obligations of Borrower now or hereafter existing
under any Credit Document, irrespective of whether or not Agent or Lenders shall
have made any demand under such Credit Document and although such obligations
may be unmatured. Lenders agree promptly to notify Borrower after any such
set-off and application, provided that the failure to give such notice shall not
affect the validity of such set-off and application. The rights of Lenders under
this Section are in addition to other rights and remedies (including, without
limitation, other rights of set-off) which Lenders may have.

                  (b) Borrower's obligations to make payments and perform all
other obligations hereunder, and the rights of Agent and Lenders in and to such
payments and performance, are absolute and unconditional and shall not be
subject to any abatement, reduction, set-off, defense, counterclaim or
recoupment for any reason whatsoever, including, without limitation, abatements
or reductions due to any present or future claims of Borrower against Agent, any
Lender, Vendor or its Affiliates or any other vendor of equipment or services
used or planned to be used as part of the Globalstar System, or against any
other Person related in any way to the Globalstar System for any reason
whatsoever.

         8.6 BINDING EFFECT; ASSIGNMENTS. This Agreement and the other Credit
Documents shall be binding upon and inure to the benefit of Borrower, Lenders
and Agent and their respective successors and assigns. Borrower shall not have
the right to assign its rights or delegate its duties hereunder or any interest
herein without the prior written consent of Lenders and Agent. Any Lender may,
with the written consent of Borrower (at all times other than during the
existence of an Event of Default under SUBSECTIONS 6.1(a), (i) OR (j) hereof in
which event Borrower's consent shall not be required) and Agent (and written
notice to each other Lender), at any time assign or sell participation interests
in all or any part of their interests under this Agreement or any of the other
Credit Documents; provided that no written consent of Borrower or Agent shall be
required in connection with any assignment or participation sold by QUALCOMM to
any Affiliate of QUALCOMM if all contractual rights and obligations of

                                      47.
<PAGE>   48
QUALCOMM relating to Globalstar or the Globalstar System shall concurrently
therewith be transferred to such Affiliate; provided, however, that no Lender
shall transfer or grant any participating interest under which the participant
shall have rights to approve any amendment, consent or waiver with respect to
this Agreement except to the extent such amendment, consent or waiver would
require unanimous consent as described in SECTION 8.1 of this Agreement. Lenders
may, subject to SECTION 8.19 below, disclose the Credit Documents and any
financial or other information relating to Borrower to any potential assignee or
participant. The form of Assignment and Acceptance is attached hereto as EXHIBIT
D.

         8.7 NATURE OF LENDERS' OBLIGATIONS. Nothing contained in this
Agreement, any other Credit Document or the Development Agreement and no action
taken by Lenders pursuant hereto or thereto may, or may be deemed to, make Agent
or Lenders a partnership, an association, a joint venture, or other entity, with
Borrower.

         8.8 NON-LIABILITY OF LENDERS. The relationship between Borrower and
Lenders (including, but not limited to QUALCOMM acting in its capacity as a
Lender and not Vendor) is, and shall at all times remain, solely that of
borrower and lender, and Lenders neither undertake nor assume any responsibility
or duty to Borrower to review, inspect, supervise, pass judgment upon, or inform
Borrower of any matter in connection with any phase of Borrower's business,
operations, or condition, financial or otherwise. Borrower shall rely entirely
upon its own judgment with respect to such matters, and any review, inspection,
supervision, exercise of judgment, or information supplied to Borrower by
Lenders in connection with any such matter is for the protection of Lenders, and
neither Borrower nor any third party is entitled to rely thereon.

         8.9 GOVERNING LAW. THIS AGREEMENT AND THE OTHER CREDIT DOCUMENTS AND
THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT AND THE OTHER
CREDIT DOCUMENTS SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

         8.10 JURISDICTION, VENUE, SERVICE OF PROCESS; ARBITRATION..

                  (a) JURISDICTION, VENUE. BORROWER, AGENT AND EACH LENDER
HEREBY AGREE THAT ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT
OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF
CALIFORNIA OR OF THE UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF
CALIFORNIA AS AGENT OR ANY LENDER MAY ELECT, AND, BY EXECUTION AND DELIVERY
HEREOF, EACH OF BORROWER, LENDERS AND AGENT ACCEPTS AND CONSENTS TO, FOR ITSELF
AND IN RESPECT TO ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE JURISDICTION
OF THE AFORESAID COURTS AND AGREES THAT SUCH JURISDICTION SHALL BE EXCLUSIVE,
UNLESS WAIVED BY AGENT AND EACH LENDER IN WRITING, WITH RESPECT TO ANY ACTION OR
PROCEEDING BROUGHT BY BORROWER AGAINST AGENT OR ANY LENDER AND ANY QUESTIONS
RELATING TO USURY. NOTHING HEREIN SHALL LIMIT THE RIGHT OF AGENT OR ANY LENDER
TO BRING PROCEEDINGS AGAINST BORROWER IN THE COURTS OF ANY OTHER JURISDICTION.
BORROWER WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY RIGHT TO STAY OR TO
DISMISS ANY ACTION OR PROCEEDING BROUGHT BEFORE SAID COURTS ON THE BASIS OF
FORUM NON CONVENIENS.

                  (b) SERVICE OF PROCESS. SERVICE OF PROCESS ON BORROWER, AGENT

                                      48.
<PAGE>   49
OR ANY LENDER IN ANY ACTION SUBJECT TO THIS SECTION 8.10 SHALL BE EFFECTIVE IF
MAILED TO SUCH PARTY AT THE ADDRESS FOR NOTICES SPECIFIED IN SECTION 8.2 ABOVE.

                  (c) WAIVER OF JURY TRIAL. EACH OF BORROWER, AGENT AND EACH
LENDER HEREBY IRREVOCABLY WAIVES ITS RIGHTS TO A JURY TRIAL WITH RESPECT TO ANY
ACTION, CLAIM OR OTHER PROCEEDING ARISING OUT OF ANY DISPUTE IN CONNECTION WITH
THIS AGREEMENT OR ANY OF THE OTHER CREDIT DOCUMENTS, ANY RIGHTS OR OBLIGATIONS
HEREUNDER OR THEREUNDER, OR THE PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS.

         8.11 CONFLICT IN CREDIT DOCUMENTS. To the extent there is any actual
irreconcilable conflict between the provisions of this Agreement and any other
Credit Document, the provisions of this Agreement shall prevail.

         8.12 MAXIMUM RATE. In no event whatsoever shall the interest rate and
other charges charged hereunder exceed the highest rate permissible under any
law which a court of competent jurisdiction shall, in a final determination,
deem applicable hereto. In the event that a court determines that Lenders have
received interest and other charges in the nature of interest hereunder in
excess of the highest rate applicable hereto, the amount of such excess shall be
deemed to have been a payment of principal and such excess shall be applied
ratably between the Tranche A Facility and the Tranche B Facility.

         8.13 BROKER. Borrower and Lenders represent and warrant to each other
that, with respect to the financing transaction herein contemplated, no Person
is entitled to any brokerage fee or other commission as a result of their
respective conduct and each agrees to indemnify and hold the other harmless
against any and all such claims for which the indemnitor is responsible.

         8.14 INDEMNIFICATION. Borrower agrees to indemnify, save, and hold
harmless Agent, Lenders and their directors, officers, agents, attorneys and
employees (collectively, the "indemnitees") from and against: (i) any and all
claims, demands, actions, or causes of action that are asserted against any
indemnitee by any Person if the claim, demand, action, or cause of action arises
out of or relates to a claim, demand, action, or cause of action that the Person
asserts or may assert against Borrower, or any officer, director or shareholder
of Borrower in their capacity as such, (ii) any and all claims, demands, actions
or causes of action that are asserted against any indemnitee (other than by
Borrower or by another indemnitee) if the claim, demand, action or cause of
action arises out of or relates to the Loans, the use of proceeds of any Loans,
or the relationship of Borrower and Lenders under this Agreement or any
transaction contemplated pursuant to this Agreement, (iii) any administrative or
investigative proceeding by any governmental agency arising out of or related to
a claim, demand, action or cause of action described in clauses (i) or (ii)
above; and (iv) any and all liabilities, losses, costs, or expenses (including
outside attorneys' fees and disbursements) that any indemnitee suffers or incurs
as a result of any of the foregoing; provided, that Borrower shall have no
obligation under this SECTION 8.14 to Agent or any Lender with respect to any of
the foregoing arising out of the gross negligence or willful misconduct of Agent
or such Lender.

         8.15 HEADINGS. Headings in this Agreement are for convenience of
reference only and are not part of the substance hereof.

                                      49.
<PAGE>   50
         8.16 COUNTERPARTS. This Agreement may be executed in identical original
counterparts, each of which will be deemed to be an original and taken together
shall constitute one and the same instrument.

         8.17 SURVIVAL. All indemnities herein shall survive the execution and
delivery of this Agreement and the making and repayment of all Loans.

         8.18 EFFECTIVENESS. This Agreement shall become effective on the date
on which Borrower and Lenders shall have signed a copy hereof and shall have
delivered the same to the other parties.

         8.19 CONFIDENTIALITY. Agent and each Lender agrees that it will use its
reasonable best efforts to keep confidential any material non-public information
from time to time supplied to it under this Agreement; provided, however, that
nothing herein shall prohibit Agent or any Lender from disclosing such
information (i) to the extent Agent or such Lender in good faith believes it is
required by statute, rule, regulation or judicial process to divulge such
information to any Person as required by such authority, (ii) to Agent's or such
Lender's counsel, (iii) to Agent's or such Lender's examiners, regulators,
advisors, auditors or comparable Persons, (iv) to any of Agent's or such
Lender's Affiliates who are notified of the confidential nature of the
information and agree to be bound by this provision or provisions reasonably
comparable hereto , (v) to any other Lender or any assignee, transferee or
participant of all or any portion of Agent's or any Lender's rights under this
Agreement or the other Credit Documents who is notified of the confidential
nature of the information and agrees to be bound by this provision or provisions
reasonably comparable hereto or (vi) any other Person in connection with any
litigation to which any of Lenders on the one hand and any of the Credit Parties
on the other hand are parties; and provided, further, that no Lender shall have
any obligation under this SECTION 8.19 to the extent any such information
becomes available on a non-confidential basis from a source other than Borrower
or its Subsidiaries or that any information becomes publicly available other
than by a breach of this SECTION 8.19. Each Lender agrees it will use all
confidential information exclusively for the purpose of evaluating, monitoring,
selling, protecting or enforcing its rights under this Agreement and the other
Credit Documents. Without affecting any other rights of Borrower, each Lender
agrees that Borrower shall be entitled to seek the remedies of injunction and
specific performance for any breach of the provisions of this SECTION 8.19.

         8.20 ENTIRE AGREEMENT. This Agreement, the other Credit Documents and
the documents and agreements executed in connection herewith and therewith
constitute the final agreement of the parties hereto and supersede any prior
agreement or understanding, written or oral, with respect to the matters
contained herein and therein, including but not limited to portions of the Term
Sheet containing terms and conditions expressly set forth herein (but excluding
matters not expressly set forth herein, including the matters described in the
Term Sheet under the caption entitled "Additional Requirements."

                                      50.
<PAGE>   51
         IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunder duly authorized, as of the date
first above written.

BORROWER:                GLOBALSTAR, L.P.,
                         a Delaware limited partnership

                                 By:  Loral/Qualcomm Satellite Services, L.P.

                                         By:  Loral/Qualcomm Partnership, L.P.

                                             By:  Loral General Partner, Inc.

                         By:  /s/ Eric J. Zahler
                                  Name:  Eric J. Zahler
                                  Title:  President and COO

                                Credit Agreement
<PAGE>   52
AGENT:                        QUALCOMM INCORPORATED

                              By:      /s/ Anthony S. Thornley
                                       Name:  Anthony S. Thornley
                                       Title:  Executive Vice President and CFO

                              Agent's Payment Office

                              QUALCOMM Incorporated
                              5755 Morehouse Drive
                              San Diego, California 92121
                              Attention:  Vice President - Project Finance /
                                           Direct Investments
                              Fax No. (619) 658-4203
                              With Copy to:  General Counsel

LENDERS:                      QUALCOMM INCORPORATED

                              By:  /s/ Anthony S. Thornley
                                       Name: Anthony S. Thornley
                                       Title:  Executive Vice President and CFO

                              Domestic Lending Office

                              QUALCOMM Incorporated
                              5755 Morehouse Drive
                              San Diego, California 92121
                              Attention:  Vice President - Project Finance /
                                           Direct Investments
                              Fax No. (619) 658-4203
                              With Copy to:  General Counsel

                                Credit Agreement
<PAGE>   53
                                  SCHEDULE 1.1

                                   COMMITMENTS

<TABLE>
<S>                                <C>                                     <C>
                                   TRANCHE A COMMITMENT                    TRANCHE B COMMITMENT
QUALCOMM Incorporated                 $113,790,187.07                         $417,325,640.64
</TABLE>

                        LOANS OUTSTANDING ON CLOSING DATE

<TABLE>
<S>                                <C>                                     <C>
                                   TRANCHE A LOANS                         TRANCHE B LOANS
QUALCOMM Incorporated              $113,790,187.07                         $368,259,141.07
</TABLE>
<PAGE>   54
INDEX OF SCHEDULES

Schedule 1.1                        --      Commitments
Schedule  5.2(b)(x)                 --      Indebtedness
Schedule  5.2(d)(ii)(D)             --      Sales of Assets
Schedule 5.2(e)                     --      Distributions
Schedule 5.2(g)                     --      Transactions with Affiliates

                                INDEX OF EXHIBITS

Exhibit A-1                --       Form of Tranche A Note
Exhibit A-2                --       Form of Tranche B Note
Exhibit B                  --       Form of Notice of Deemed Loan
Exhibit C                  --       Form of Non-Bank Lender Tax Certificate
Exhibit D                  --       Form of Assignment and Acceptance
Exhibit E                           Form of Subsidiary Guarantee<PAGE>   1
                                                                    EXHIBIT 10.2

                          AMENDMENT TO THE EXCHANGE AND
                          REGISTRATION RIGHTS AGREEMENT

            AMENDMENT, dated as of May 5, 2000 to the EXCHANGE AND REGISTRATION
RIGHTS AGREEMENT, dated as of December 31, 1994 (as amended, the "Agreement"),
among GLOBALSTAR, L.P., a Delaware limited partnership ("Globalstar"),
GLOBALSTAR TELECOMMUNICATIONS LIMITED, a Bermuda company ("GTL"), QUALCOMM
Incorporated, a Delaware corporation ("Qualcomm"), Loral Space & Communications
Ltd., a Bermuda company ("Loral"), Loral SpaceCom Corporation, a Delaware
corporation ("LSC") and Loral Space & Communications Corporation, a Delaware
corporation ("LSCC" and together with Loral and LSC, the "Loral Entities").

            WHEREAS, pursuant to Section 7 of the Agreement, Globalstar and GTL
have the right to amend the Agreement to grant to any partner of Globalstar
admitted into the partnership after December 31, 1994 the exchange and
registration rights afforded in the Agreement; and

            WHEREAS; Globalstar has issued to Qualcomm and the Loral Entities
warrants to acquire ordinary partnership interests of Globalstar (collectively,
the "Warrants"); and

            WHEREAS, Globalstar and GTL wish to amend the Agreement to include
Qualcomm and the Loral Entities as a Partner within the meaning of the Agreement
effective as of the date Qualcomm and the Loral Entities first acquired ordinary
partnership interests in Globalstar:

1. Rights of Additional Partners.

            (a) The parties hereto agree that from and after the first day on
which each of Qualcomm, Loral, LSC and/or LSSC (collectively, the "Additional
Partners") shall acquire ordinary partnership interests in Globalstar, all
references to "Partner" or "Partners" in the Agreement shall be deemed also to
refer to each of the Additional Partners, as the case may be.

            (b) Notwithstanding the foregoing, the parties hereto agree that
from and after the date hereof, each of the Additional Partners shall be
considered to be Partners for the purposes of the Sections 1(b) and 3 of the
Agreement. Each of the Company and Globalstar hereby represents and warrants to
each of the Additional Partners the accuracy of the representations and
warranties set forth in Section 5(a) of the Agreement as applied to the
Agreement as amended through the date of this Amendment. Notices to the
Additional Partners shall be delivered to them at the addresses specified under
their signatures below. Except as permitted pursuant to Section 7 of the
Agreement, no amendment or waiver of the provisions of the Agreement may be
effected without the written agreement of each of the Additional Partners.

            (c) GTL agrees that it shall at all times reserve and keep available
out of its authorized but unissued shares of Common Stock, solely for the
issuance and delivery upon the
<PAGE>   2
exercise of the Warrants and exchange of the related partnership interests
therefor, such number of its duly authorized shares of Common Stock as from time
to time shall be issuable upon the exercise of the Warrants and exchange of the
related partnership interests. Each of the Loral Parties hereby agree to provide
to QUALCOMM written notice of exercise of, or intent to exercise, the Warrants
in its favor within 30 days of the date of such exercise, or, if earlier, not
later than 30 days prior to the end of Globalstar's tax year.

2. Obligations of Additional Partners. Each of the Additional Partners hereby
agrees that from and after the date on which it shall have first acquired
ordinary partnership interests in Globalstar, it shall be bound by the terms of
the Agreement, including without limitation, the representations and warranties
of the Partners contained therein.

3. Defined Terms. Capitalized terms used herein not otherwise defined shall have
the meanings set forth in the Agreement.

4. Counterpart. This Amendment may be executed in counterparts, all of which
together shall constitute one agreement binding on all the parties hereto.

5. Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF
NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAW.

            IN WITNESS WHEREOF, the undersigned have caused this Amendment to be
duly executed and delivered by their respective duly authorized officer as of
the day and year first above written.

                                    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/  Eric Zahler
                                        ----------------------------------------
                                        Name:  Eric Zahler
                                        Title: President and Chief Operating
                                               Officer

                                    GLOBALSTAR TELECOMMUNICATIONS LIMITED
<PAGE>   3
                                    By:   /s/  Eric Zahler
                                        ----------------------------------------
                                        Name:  Eric Zahler
                                        Title: Vice Chairman

                                    QUALCOMM INCORPORATED

                                    By:   /s/  Anthony S. Thurnley
                                        ----------------------------------------
                                        Name:  Anthony S. Thurnley
                                        Title: Chief Financial Officer

                                    LORAL SPACECOM CORPORATION

                                    By:   /s/  Richard J. Townsend
                                        ----------------------------------------
                                        Name:  Richard T. Townsend
                                        Title: Senior Vice President and Chief
                                               Financial Officer

                                    Address:
                                    600 Third Avenue
                                    New York, New York 10016
<PAGE>   4
                                    LORAL SPACE & COMMUNICATIONS LTD.

                                    By:   /s/  Richard J. Townsend
                                        ----------------------------------------
                                        Name:  Richard T. Townsend
                                        Title: Senior Vice President and Chief
                                               Financial Officer

                                    c/o Address:
                                    600 Third Avenue
                                    New York, New York 10016

                                    LORAL SPACE & COMMUNICATIONS CORPORATION

                                    By:   /s/  Richard J. Townsend
                                        ----------------------------------------
                                        Name:  Richard T. Townsend
                                        Title: Senior Vice President and Chief
                                               Financial Officer

                                    c/o Address:
                                    600 Third Avenue
                                    New York, New York 10016

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