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                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
 
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                                 FORM 10-Q/A
                                      
      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
      EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1996
                                      
                    GLOBALSTAR TELECOMMUNICATIONS LIMITED
                                 Cedar House
                               41 Cedar Avenue
                            Hamilton HM12, Bermuda
                          Telephone: (809) 295-2244
                                      
                    Jurisdiction of Incorporation: Bermuda
                                      
                    IRS identification number: 13-3795510
 
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     The Registrant hereby amends Item 2 -- Management's Discussion and Analysis
of Financial Condition and Results of Operations -- of Form 10-Q filed on May
15, 1996. This amendment corrects a typographical error in the fifth sentence of
the second paragraph under the caption "Certain Factors that May Affect Future
Results". Item 2 is amended and replaced with the following:
 
                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                 FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 
     GTL is a holding company that acts as a general partner of Globalstar and
has no other business. The Company's sole asset is its investment in Globalstar
and GTL's results of operations reflect its share of the results of operations
of Globalstar on an equity accounting basis. Accordingly, management's
discussion and analysis addresses the financial condition and results of
operations of Globalstar. In its annual and quarterly reports, GTL presents
separate financial statements for GTL and Globalstar.
 
     Except for the historical information contained herein, the matters
discussed in this Management's Discussion and Analysis of Financial Condition
and Results of Operations, and elsewhere in this Form 10-Q, are forward-looking
statements that involve risks and uncertainties, many of which may be beyond
Globalstar's control. These may include, but are not limited to, problems
relating to technical development of the system, testing, regulatory compliance,
manufacturing and assembly, the competitive and regulatory environment in which
Globalstar will operate, marketing problems and costs and expenses that may
exceed current estimates. The actual results that Globalstar achieves may differ
materially from any forward-looking projections due to such risks and
uncertainties.
 
LIQUIDITY AND CAPITAL RESOURCES
 
     At March 31, 1996, cash and cash equivalents increased to $247.1 million
from $71.6 million at December 31, 1995. The net increase is a result of the
receipt of $290.0 million from the sale of 4,615,385 Redeemable Preferred
Partnership Interests, advance payments received for option territories of $1.7
million and interest on outstanding cash balances of $1.4 million, offset by the
expenditures for operations and the Globalstar System Under Construction.
 
     Payables to affiliates and accrued expenses decreased by $10.8 million from
$54.4 million to $43.6 million during the three months ended March 31, 1996, as
a result of the timing of payments to Globalstar contractors.
 
     Globalstar anticipates that the cost for the design, construction and
deployment of the Globalstar System, excluding working capital, cash interest on
anticipated borrowings and operating expenses to be approximately $1.8 billion.
Actual amounts may vary from this estimate and additional funds would be
required in the event of unforeseen delays, cost overruns, launch failures or
other technological risks or adverse regulatory developments, or to meet
unanticipated expenses.
 
     Through March 31, 1996, Globalstar incurred costs of approximately $612
million for the design and construction of the satellite constellation, launch
vehicle payments and portions of the two SOCCs, two GOCCs, Globalstar Phones and
four gateways that make up part of the Globalstar ground segment. Costs incurred
during the first quarter 1996 were approximately $121 million (including $19.4
million accrued under vendor financing arrangements) as satellite production
activities continued, including pre-production model construction and test,
parts procurement and subassembly construction of the satellites. Expenditures
for the GOCCs and SOCCs included costs for software integration and test. Total
1996 system costs are expected to approximate $566 million and include an
estimated $90.1 million of accrued costs under vendor financing arrangements.
Satellite production, integration and testing will continue during the year.
Ground Segment activities in 1996 will include the development of laboratory
prototypes of the Globalstar Phones and the completion of SOCC installation and
checkout.
 
     In addition to the above capital requirements, Globalstar will require
funds for its working capital, interest and preferred distributions on the
Redeemable Preferred Partnership Interests and future financings, repayment of a
portion of vendor financing and operating expenses through the Full
Constellation Date, currently estimated to be approximately $293 million.
 
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                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS -- (CONTINUED)
 
     Globalstar and its strategic service providers intend to jointly finance
the procurement of 25 gateways and long-lead parts for 25 additional gateways
for resale to service providers, thereby accelerating the deployment of gateways
around the world prior to the In-Service Date. The cost of this program before
financing costs is expected to be approximately $160 million, of which
Globalstar has agreed to finance approximately $80 million. Globalstar expects
to recover its investment in this gateway financing program from the resale of
these gateways to service providers.
 
     This information represents Globalstar's current anticipated cash
requirements. Actual amounts may vary from these estimates and additional funds
would be required in the event of unforeseen delays, cost overruns, launch
failures or other technological risks or adverse regulatory developments, or to
meet unanticipated expenses.
 
     Through March 31, 1996, Globalstar has obtained $770 million of equity from
its partners (of which $290 million represents the sale of the Redeemable
Preferred Partnership Interests to GTL, which was purchased by GTL with the
proceeds from the issuance of the 6 1/2% Convertible Preferred Equivalent
Obligations), a $250 million credit facility (the "Globalstar Credit
Agreement"), guaranteed by certain parties, and commitments for approximately
$310 million of vendor financing. In addition, Globalstar had received
approximately $24 million of advance payments associated with certain Globalstar
service territories.
 
     Globalstar believes that its current capital, vendor financing commitments
and the availability of the Globalstar Credit Agreement are sufficient to fund
its requirements into the first quarter 1997. Of such financing commitments, a
substantial portion of the vendor financing will not be utilized until 1997 and
1998. Additional funds to complete the Globalstar System are expected to be
obtained through a combination of debt issuance (which may include an equity
component), projected service provider payments, projected net service revenues
from initial operations, anticipated payments received from the sale of gateways
and Globalstar Phones and placement of limited partnership interests with new
and existing strategic investors. Although Globalstar believes it will be able
to obtain this additional financing, there can be no assurance that the
financing will be available on favorable terms or on a timely basis, if at all.
 
     On April 23, 1996, the merger between Loral Corporation and Lockheed Martin
Corporation was completed. In conjunction with the merger, Loral's space and
communications businesses, including its direct and indirect interests in
Globalstar, GTL, SS/L and other affiliated businesses, as well as certain other
assets, have been transferred to Loral Space & Communications Ltd. In connection
with the merger, Lockheed Martin assumed $150 million of the guarantee on the
Globalstar Credit Agreement, and the balance of the guarantee was assumed by
various Globalstar partners.
 
RESULTS OF OPERATIONS
 
     Globalstar is a development stage partnership and has not commenced
commercial service operations. For the period March 23, 1994 (commencement of
operations) to March 31, 1996, Globalstar has recorded cumulative net losses of
$108.4 million. The net loss for the quarter ended March 31, 1996 decreased to
$14.0 million from $17.2 million in the quarter ended March 31, 1995 as a result
of timing of payments to Globalstar contractors. Globalstar is expending
significant funds for the design, construction, testing and deployment of the
Globalstar System and expects such losses to continue until commencement of
service operations.
 
     Globalstar has earned interest income of $15.2 million since commencement
of operations on cash balances and short term investments. Interest income for
the quarter ended March 31, 1996 was $1.4 million as compared to $2.2 million
earned during the quarter ended March 31, 1995. Interest income has decreased
from the quarter ended March 31, 1995 as a result of lower cash balances within
the quarter ended March 31, 1996.
 
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                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS -- (CONTINUED)
 
     Operating Expenses.  Development costs of $11.4 million for the quarter
ended March 31, 1996, represent the development of certain technologies under a
cost sharing arrangement in Globalstar's contract with Qualcomm, the development
of Globalstar Phones and Globalstar's continuing in-house engineering. This
compares with $16.2 million of development costs incurred during the quarter
ended March 31, 1995.
 
     Marketing, general and administrative expenses were $4.0 million for the
quarter ended March 31, 1996 as compared to $3.2 million incurred during the
quarter ended March 31, 1995. The increase from the quarter ended March 31, 1995
is a result of both increased marketing and personnel costs, consistent with the
higher level of activity at Globalstar.
 
     Depreciation.  Globalstar intends to capitalize all costs, including
interest as applicable, associated with the design, construction and deployment
of the Globalstar System, except costs associated with the development of the
Globalstar Phones and certain technologies under a cost sharing arrangement with
Qualcomm. Globalstar will not record depreciation expense on the Globalstar
System under construction until the commencement of initial service operations,
as assets are placed into service.
 
     Income Taxes.  Globalstar was organized as a limited partnership. As such,
no income tax provision (benefit) is included in the accompanying financial
statements since U.S. income taxes are the responsibility of its partners.
Generally, taxable income (loss), deductions and credits of Globalstar will be
passed through to its partners.
 
CERTAIN FACTORS THAT MAY AFFECT FUTURE RESULTS
 
     This quarterly report on Form 10-Q contains forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. In addition,
from time to time, Globalstar, GTL or their representatives have made or may
make forward-looking statements, orally or in writing. Such forward-looking
statements may be included in, but are not limited to, various fillings made by
GTL with the Securities and Exchange Commission, press releases or oral
statements made with the approval of an authorized executive officer of GTL or
Globalstar. Actual results could differ materially from those projected or
suggested in any forward-looking statements as a result of a wide variety of
factors and conditions, including, but not limed to, the factors summarized
below. These factors and other factors and conditions have been described in the
section of GTL's Prospectus, dated February 14, 1995, entitled, "Risk Factors,"
the section of Loral Space & Communications Ltd.'s Information Statement, dated
April 12, 1996, entitled, "Risk Factors -- Globalstar," and other documents GTL
files from time to time with the Securities and Exchange Commission including
GTL's annual reports on Form 10-K, quarterly reports on Form 10-Q and current
reports on Form 8-K, and the shareholder is specifically referred to these
documents with regard to the factors and conditions that may affect future
results.
 
     GTL's and Globalstar's future results are subject to substantial risks and
uncertainties. Globalstar is a development stage company and has no operating
history. From its inception, Globalstar has incurred net losses and expects such
losses to continue until commercial service operations have commenced.
Globalstar will require expenditures of significant funds for development,
construction, testing and deployment before commercialization of the Globalstar
System. Globalstar does not expect to launch satellites until the second half of
1997, to commence operations before the second half of 1998 or to achieve
positive cash flow before 1999. There can be no assurance that Globalstar will
achieve its objectives by the targeted dates.
 
     Globalstar expects to require total capital of approximately $2.2 billion.
Globalstar has raised or received commitments for approximately $1.4 billion.
Globalstar believes that its current capital base is sufficient to fund
Globalstar's requirements into the first quarter of 1997. Additional funds to
complete the Globalstar System are expected to be obtained from a combination of
sources. There can be no assurance that additional funds required to complete
the Globalstar System will be available on favorable terms or on a timely basis,
if at all. If there are unforeseen delays, if technical or regulatory
developments result in a need to modify the design of all or a portion of the
Globalstar System, if service provider agreements for additional territories are
 
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                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS -- (CONTINUED)
 
not entered into at the times or on the terms anticipated by Globalstar or if
other additional costs are incurred, the risk of which is substantial in view of
the early stage of Globalstar's development, additional capital will be
required. The ability of Globalstar to achieve positive cash flow will depend
upon the successful and timely design, construction and deployment of the
Globalstar System, as to which there can be no assurance. If Globalstar fails to
commence commercial operations in 1998 or achieve positive cash flow in 1999,
additional capital will be needed.
 
     The Globalstar System is exposed to the risks inherent in a large-scale
complex telecommunications system employing advanced technologies which must be
adapted to the Globalstar application and which have never been tested or used
as a commercial whole. Deployment of the Globalstar satellite constellation will
involve volume production and testing of satellites in quantities significantly
higher than those previously prevailing in the industry. The integration of a
worldwide low-earth orbit satellite-based system like Globalstar has never
occurred in the commercial marketplace; there is no assurance that such
integration will be successfully implemented. The operation of the Globalstar
System will require the detailed design and integration of advanced digital
communications technologies in devices from personal handsets and public
telephone networks to gateways in remote regions of the globe and satellites
operating in space. The failure to develop, produce and implement the system, or
any of its diverse and dispersed elements, as required, could delay the
commercial operation of the Globalstar System or render it unable to perform at
the quality and capacity levels required for success.
 
     Launches of the Globalstar satellites are subject to significant risks,
including damage to or loss of the satellites ("hot failures"). There is no
assurance that Globalstar satellite launches will be successful or that its
launch failure rate will not exceed industry averages.
 
     A number of factors will affect the useful lives of Globalstar's
satellites. Random failure of satellite components could result in damage to or
loss of a satellite ("cold failures"). The first-generation satellite
constellation (including spares) is designed to operate at full performance for
a minimum of 7 1/2 years, after which performance is expected to gradually
decline. However, there can be no assurance of the constellation's specific
longevity. Globalstar's operating results would be adversely affected in the
event the useful life of the satellites was shorter than 7 1/2 years.
 
     The availability of Globalstar service in each region or country will
depend upon the cooperation, operational and marketing efficiency,
competitiveness, finances and regulatory status of Globalstar's service provider
in that region or country. If the service providers fail to obtain the necessary
local regulatory approval or to adequately market and distribute Globalstar's
services, Globalstar's business could be adversely affected. There can be no
assurance that enough service providers will contract for Globalstar service and
procure and install the gateways and obtain the regulatory licenses necessary
for complete global service.
 
     Competition in the telecommunications industry is intense, fueled by rapid
and continuous technological advances and alliances between industry
participants on an international scale. Although no one at present is providing
the same global personal telecommunications service proposed by Globalstar, it
is anticipated that one or more additional competing systems will be launched.
If any of Globalstar's competitors succeeds in marketing and deploying its
system earlier than Globalstar or at a lower cost, Globalstar's ability to
compete in areas served by such competitor may be adversely affected.
 
     It is expected that as land-based telecommunications services expand to
regions currently underserved or not served by wireline or cellular services,
demand for Globalstar service in those regions may be reduced. If such systems
are constructed at a more rapid rate than that anticipated by Globalstar, the
demand for Globalstar service may be reduced at rates higher than those assumed
by Globastar. Globalstar may also face competition in the future from companies
using new technologies and new satellite systems. New technology could render
Globalstar obsolete or less competitive by satisfying consumer demand in
alternative ways or through the introduction of incompatible telecommunications
standards. A number of these new technologies, even if they are not ultimately
successful, could have an adverse effect on Globalstar. Globalstar's business
 
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                    MANAGEMENT'S DISCUSSION AND ANALYSIS OF
          FINANCIAL CONDITION AND RESULTS OF OPERATIONS -- (CONTINUED)
 
would be adversely affected if competitors begin operations or existing or new
telecommunications service providers penetrate Globalstar's target markets
before completion of the Globalstar System.
 
     Subscriber acceptance of the Globalstar System will depend upon a number of
factors, including the quality of the service provided and the cost to the
subscriber. If the level of actual subscriber demand and usage for Globalstar
service is below that expected by Globalstar, Globalstar's cash flow will be
adversely affected.
 
     Globalstar has entered into contracts for the design of various segments of
the Globalstar System with affiliates of the managing general partner, including
a fixed-price satellite production contract with SS/L and a cost-plus-fee
contract with Qualcomm to design the gateways, ground operations control systems
and Globalstar Phones. To the extent that such contracts have been or will be
awarded to partners of Globalstar or their affiliates, such parties will have a
conflict of interest with respect to the terms thereof.
 
     Partners and affiliates of Globalstar, including companies affiliated with
or controlled by Loral Space & Communications Ltd., will be among Globalstar's
principal service provider customers and may therefore have conflicts of
interest with respect to the terms of Globalstar's service provider agreements
and any proposed amendments thereto.
 
                                   SIGNATURES
 
     Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
 
                                      GLOBALSTAR TELECOMMUNICATIONS LIMITED
 
                                                      Registrant
 
Date: May 17, 1996                                NICHOLAS C. MOREN
 
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                                                      Treasurer
                                            (Principal Financial Officer)
                                                         and
                                           Registrant's Authorized Officer
 
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