EXHIBIT 10.3

Exclusivity Agreement

This Exclusivity Agreement (this “Agreement”) dated May 6, 2010 is among TerreStar Corporation (“TerreStar”), TerreStar Networks Inc. (“Networks” and together with TerreStar, the “Company”), SkyTerra LP, SkyTerra Communications, Inc. and HGW Holding Company, L.P. (“HGW Holding Company” and together with SkyTerra LP and SkyTerra Communications, Inc., “SkyTerra”). The Company and SkyTerra are each referred to herein as a “party” and collectively referred to herein as the “parties”.

Background

The Company and SkyTerra desire to have negotiations regarding certain transactions (the “Proposed Transaction”) described in that certain draft term sheet attached hereto (the “Term Sheet”). Such negotiations began pursuant to a prior exclusivity agreement between the Company, HGW Holding Company and certain affiliates of HGW Holding Company. Although affiliates of SkyTerra will have the right to be involved in such negotiations and subject to SkyTerra’s right to assign this Agreement pursuant to Section 7(c), SkyTerra LP will be the SkyTerra entity primarily engage in such negotiations.

Contemporaneously with the execution of this Agreement, and in consideration of the Company entering into this Agreement, SkyTerra LP and SkyTerra Communications, Inc. are entering into a Satellite Minutes Agreement (the “Satellite Agreement”) with Networks pursuant to which SkyTerra LP and SkyTerra Communications, Inc., subject to the terms and conditions in the Satellite Agreement, will purchase from Networks mobile satellite minutes with an aggregate purchase price of $40,000,000 (the “Purchase Payment”). A portion of the Purchase Payment will be obtained from HGW Holding Company. SkyTerra LP and SkyTerra Communications, Inc. would not enter into the Satellite Agreement or make the Purchase Payment in the absence of this Agreement. HGW Holding Company would not make Purchase Prepayment funds available in the absence of this Agreement.

Negotiation of the Proposed Transaction and the associated due diligence have involved and will continue to require a significant allocation of SkyTerra resources.

In order to induce SkyTerra LP and SkyTerra Communications, Inc. to enter into the Satellite Agreement and in order to induce HGW Holding Company to make Purchase Payment funds available, the parties desire to enter into this Agreement.

Therefore, the parties agree as follows:

1. Negotiations. For the period from the date hereof through August 4, 2010 (or such later date as the parties may agree, the “Termination Date”), the Company will, and will cause the Company’s direct and indirect subsidiaries (collectively, the “Controlled Subsidiaries”) to diligently engage in good faith negotiations with respect to the Proposed Transaction.

2. Alternative Transactions.

(a) For the period from the date hereof through the Termination Date, the Company shall not, and the Company shall not permit any of its affiliates, or any of the representatives or employees of or advisors to the Company or any of its affiliates to, directly or indirectly, take any action to (i) encourage, entertain, solicit, facilitate or initiate the submission of any Alternative Transaction Proposal, (ii) enter into any written or oral agreement for or relating to a Third Party Transaction (as hereinafter defined), or (iii) participate in any way in discussions or negotiations with, or furnish any non-public information to, any person in connection with any Alternative Transaction Proposal. The Company shall be responsible for any breach of this Agreement by any of its affiliates or any of their respective representatives or advisors. The Company will immediately communicate to SkyTerra the receipt of any third party solicitation, proposal or inquiry that the Company, its affiliates or any of their respective representatives or advisors may receive in respect of any Third Party Transaction, or of any request for such information, including in each case the material terms of any such third party solicitation, proposal or bona fide inquiry.

(b) “Alternative Transaction Proposal” means any proposed Third Party Transaction. “Third Party Transaction” means an Alternative Transaction with a party other than SkyTerra or an affiliate of SkyTerra. “Alternative Transaction” means, except for any Proposed Transaction, any transaction that would grant any third party rights with respect to, or take or fail to take any other action with respect to, the S-band Spectrum (as defined in the Term Sheet) that would interfere with or obstruct the use of the S-band Spectrum by SkyTerra or otherwise make it unavailable for use by SkyTerra or limit the ability of the Company or SkyTerra to enter into the Proposed Transaction.

3. No Conflict. Each party represents and warrants to the other that the first party’s entry into this Agreement does not violate any contract, order, judgment, law or regulation binding on it, or result in any material change in its right against or obligation to any third party.

4. Access. So long as negotiations are continuing, the Company will make records in its possession or control, and relevant personnel of the Company, its accountants and its advisors, available to SkyTerra and its officers, employees, affiliates, managers, partners, agents and advisors (including, without limitation, accountants, attorneys, consultants, financial advisors and bankers) as SkyTerra reasonably requests in connection with SkyTerra’s due diligence, in accordance with the terms of that certain Confidentiality Agreement, dated December 22, 2009 (the “Confidentiality Agreement”), by and among the Company, Harbinger Capital Partners Master Fund I, Ltd. and Harbinger Capital Partners Special Situations Fund, L.P.

5. Confidentiality, Publicity. The existence and terms of this Agreement, the Term Sheet and of the discussions between the parties as to the Proposed Transaction are to remain confidential, except as disclosure of its contents is required by applicable law, regulatory authority or stock exchange listing agreement; provided, however, the Term Sheet shall not be disclosed to the public in any event. In the event a party hereto or any of its representatives is required by applicable law, regulatory authority or stock exchange listing agreement to disclose any of such information, such party will (a) promptly notify the other party prior to any such disclosure, (b) reasonably accept the other party’s revisions to the proposed disclosure and (c) cooperate with the other party in any attempt it may make to obtain a protective order or other appropriate assurance that confidential treatment will be afforded the applicable information. Each party agrees that it will treat the existence and terms of this Agreement and of such discussions with the same care as

2

it would take to preserve the confidentiality of its own confidential information. Prior to the execution of definitive agreements among the parties regarding the Proposed Transaction, neither party will make any announcement to the public, to third parties, or to its respective employees concerning the Proposed Transaction without prior consultation with, and the approval of, the other party, which may be withheld in its discretion. This Section 5 will not preclude any of the parties hereto from complying with legal or regulatory requirements applicable to it. If any party believes that it is subject to such a requirement, it will give the other parties prompt prior notice thereof prior to disclosing the information in question. The provisions of this Section 5 are in addition to, and not in lieu of, the provisions of the Confidentiality Agreement, or any other confidentiality agreement among the parties.

6. Fees and Expenses. Each Party to this Agreement will pay all of its own expenses incurred in connection with the Proposed Transaction, whether or not the Proposed Transaction is entered into or consummated.

7. General.

(a) Binding and Non-Binding Provisions. Except for the express obligations set forth in this Agreement, which are intended to be legally binding, this Agreement does not create any legally binding obligation with respect to the Proposed Transaction itself or as to anything preliminary thereto. No term sheet or other document, or any act or course of dealing, other than a writing signed by both parties that expressly states that it is intended to be legally binding, shall create any legally binding obligations. This Section 7(a) sets forth the complete understanding of the parties as to the legal status of this Agreement and any such other document, act or course of dealing.

(b) Modifications. This Agreement may not be modified, supplemented or waived except by an instrument in writing expressly to that effect signed by the party against whom such modification, supplement or waiver is asserted. Any such waiver will apply only to the specific instance set forth in such writing.

(c) Assignment. All rights and obligations of SkyTerra under this Agreement may be freely assigned or otherwise transferred by SkyTerra to any affiliate(s) of SkyTerra. This Agreement may not be assigned or otherwise transferred by the Company.

(d) Applicable Law. This Agreement shall be exclusively governed by and construed in accordance with the internal laws of the State of New York without regard to its rules of conflicts of laws.

(e) Equitable Relief. The parties agree that monetary damages would not be a sufficient remedy for any breach of this Agreement by the Company and that SkyTerra shall be entitled to equitable relief, including injunction and specific performance, as a remedy for such breaches. Such remedy shall not be deemed to be the exclusive remedy for a breach by the Company of this Agreement but shall be in addition to all other remedies available at law or equity to SkyTerra.

(f) Descriptive Headings; Construction. The descriptive headings contained herein are for convenience of reference only and shall not affect in any way the meaning or

3

interpretation of this Agreement. The language used in this Agreement will be deemed to be the language chosen by the parties to express their mutual intent, and no rule of strict construction will be applied against any party.

(g) Counterparts. This Agreement and any amendments hereto may be executed in any number of counterparts, each of which shall be deemed to be an original but all of which together shall constitute but one agreement.

(h) Termination. This Agreement shall terminate on the Termination Date, provided, however that Sections 5 – 7 shall survive the termination of this Agreement and continue in full force and effect according to their terms. SkyTerra may, in its sole discretion, accelerate the Termination Date to an earlier date.

[signature page follows]

4

IN WITNESS WHEREOF, the parties hereto have executed this Exclusivity Agreement.

[Signature Page to Exclusivity Agreement]

[Signature Page to Exclusivity Agreement]

Draft

CONFIDENTIAL

Not a binding offer. For discussion purposes only

SUMMARY OF PRINCIPAL TERMS OF SPECTRUM POOLING AGREEMENT

The following is a summary of the principal terms and conditions relating to the proposed transactions described herein (the “Summary”) and is intended for discussion purposes only. The following Summary does not constitute an offer capable of acceptance. Under no circumstances shall the terms and conditions set forth in this Summary constitute or be deemed to constitute the legally binding obligation of SkyTerra LP or any of its affiliates, to negotiate or to consummate any transaction.

2

3