Globalstar’s Failure to Repay Loan Triggers Lockheed Martin Guarantee Under Bank Credit Agreement

Lockheed Martin Corporation
disclosed that The Chase Manhattan Bank notified the Corporation
on Friday, June 30, 2000 that Globalstar Telecommunications
failed to repay borrowings of $250 million under a revolving credit agreement
on which Lockheed Martin is a partial guarantor. It is Lockheed Martin’s
understanding that Globalstar drew under this facility earlier this month.

In fulfillment of its contractual obligations under the guarantee, the
Corporation has paid $207 million, including applicable interest and fees to
the bank. Lockheed Martin is entitled to repayment by Globalstar of the
amounts paid under the guarantee and has not yet reached agreement with
respect to the form and timing of repayment.

Loral Space & Communications has paid $57 million to Lockheed
Martin. That payment is based on a separate indemnification agreement made by
Loral to Lockheed Martin.

The Corporation is not changing its previous estimate of generating at
least $500 million in free cash for the year 2000. The Corporation also
affirms its previous year 2000 earnings estimate, excluding nonrecurring and
unusual items, of $1.05 per share. The Corporation is evaluating the need for
any pretax, nonrecurring charge against earnings in the 2nd quarter 2000.

NOTE:
Statements in this press release, including the statements relating
to projected future financial performance, are considered forward-looking
statements under the federal securities laws, including the Private Securities
Litigation Reform Act of 1995. Sometimes these statements will contain words
such as “believes,” “expects,” “intends,” “plans,” “estimates,” “outlook,”
“forecast, ” and other similar words. These statements are not guarantees of
our future performance and are subject to risks, uncertainties and other
important factors that could cause our actual performance or achievements to
be materially different from those we may project.
As for the forward-looking
statements that relate to future financial results and other projections,
actual results will be different due to the inherent nature of projections and
may be better or worse than projected. Given these uncertainties, you should
not place any reliance on these forward-looking statements. These forward-
looking statements also represent our estimates and assumptions only as of the
date that they were made. We expressly disclaim a duty to provide updates to
these forward-looking statements, and the estimates and assumptions associated
with them, after the date of this press release to reflect events or
circumstances or changes in expectations or the occurrence of anticipated
events.

In addition to the factors set forth in our filings with the Securities
and Exchange Commission, the following factors could affect the
forward-looking statements: competition and customer demand in the
telecommunications industry, the ability to achieve or quantify savings for
our customers or ourselves as a result of our reorganization efforts or in our
global cost-cutting program; our ability to grow earnings and generate cash
flow in accordance with our beliefs; difficulties during space launches; the
ability to obtain or the timing of obtaining future government awards; the
availability of government funding and customer requirements; economic
conditions, competitive environment, international business and political
conditions, timing of awards and contracts; timing and customer acceptance of
product delivery and launches; the outcome of contingencies, including
completion of any acquisitions and divestitures, litigation and environmental
remediation, program performance, and our ability to consummate the Comsat
transaction. These are only some of the numerous factors which may affect the
forward-looking statements in this press release.