Exhibit 10.1
 
Pursuant to 17 CFR 240.24b-2, confidential information has been omitted
in placed marked “[***]” and has been field separately with the Securities and
Exchange Commission pursuant to a Confidential Treatment Request.
 
 
 
 
 
 
 
 
 
 
 
 
 
CONTRACT
 
Between
 
Hughes Network Systems, LLC
 
And
 
Space Systems/Loral, Inc.
 
for the
 
Hughes Jupiter Satellite Program
 
 
 
June 8, 2009
 
 
 
 
 
The attached Contract and information contained therein are confidential and
proprietary to Space Systems/Loral, Inc. and Hughes Network Systems, LLC and
shall
not be published or disclosed to any third party except as permitted by the
terms and
conditions of this Contract.
 

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restriction on the title page.
 
 

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TABLE OF CONTENTS
 

 Article Page     
Table of Contents
i
Preamble
1
Recitals
2
Article 1 - Definitions
3
Article 2 - Scope of Work
13
Article 3 - Deliverable Items and Delivery Schedule
15
Article 4 - Price
18
Article 5 - Payments
20
Article 6 - Purchaser-Furnished Items
24
Article 7 - Compliance With U.S Laws and Directives
26
Article 8 - Access to Work-in-Progress
29
Article 9 - Satellite Pre-Shipment Review (SPSR) and Delivery
33
Article 10 - Acceptance of Satellite, Launch Support and Mission Support
Services and In-Orbit Test
37
Article 11 - Acceptance Inspection for Deliverable Items Other Than the
Satellite
38
Article 12 - Transfer of Title and Risk of Loss
43
Article 13 - Orbital Performance Incentives
46
Article 14 - Corrective Measures in the Satellite and Other Deliverable Items
52
Article 15 - Representations and Warranties
53
Article 16 - Changes
60
Article 17 - Force Majeure
62
Article 18 - Purchaser Delay of Work
63
Article 19 - Intellectual Property Indemnity
64
Article 20 - Indemnification
66
Article 21 - Termination for Convenience
69
Article 22 - Liquidated Damages
72
Article 23 - Termination for Default
73
Article 24 - Options
77
Article 25 - Dispute Resolution
80
Article 26 - Inter-Party Waiver of Liability for a Launch
83
Article 27 - Limitation of Liability
85

 
 
 
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Article 28 - Disclosure and Handling of Proprietary Information
87
Article 29 - Contract Technology Escrow
90
Article 30 - Public Release of Information
91
Article 31 - Notices
92
Article 32 - Risk Management Services
94
Article 33 - Order of Precedence
97
Article 34 - General
98
Article 35 - Ground Storage
102
Article 36 –[***]
104
Article 37 - Contractor Personnel
105
Article 38 - Subcontracts
107
Article 39 - Intellectual Property
108
Article 40 - Financing Requirements
110
Article 41 - Security Interest
111

 
LIST OF EXHIBITS
 
Exhibit A                      Statement of Work
 
Exhibit B                      Satellite Performance Specification
 
Exhibit C                      Product Assurance Plan
 
Exhibit D                      Satellite Test Plan
 
Exhibit E                      Price and Payment Plan
 
Exhibit F                      Escrow Agreement
 
Exhibit G                      [***]
 
Exhibit H                      [***]
 
 
 
 

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PREAMBLE
 
 
This Contract is entered into effective as of June 8, 2009 (the “Effective Date
of Contract” or “EDC”), by and between Hughes Network Systems, LLC (“Hughes”), a
limited liability company organized and existing under the laws of the state of
Delaware, having an office and place of business at 11717 Exploration Lane,
Germantown, Maryland 20876 (hereinafter referred to as “Purchaser”), and Space
Systems/Loral, Inc., a corporation organized and existing under the laws of the
state of Delaware, having an office and place of business at 3825 Fabian Way,
Palo Alto, CA 94303-4604 (hereafter referred to as “Contractor”, and Purchaser
and Contractor are hereafter referred to collectively as the “Parties” or
individually as a “Party”), regarding the Hughes Jupiter Satellite program.
 

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RECITALS
 
WHEREAS, Purchaser desires to procure a communications Satellite, Satellite
Control Facilities, Launch Support Services, Mission Support Services, Training
services and other items and services to the extent and subject to the terms and
conditions set forth herein, and
 
WHEREAS, Contractor is willing to furnish such Satellite, Satellite Control
Facilities, Launch Support Services, Mission Support Services, Training services
and other items and services to the extent of and subject to the terms and
conditions set forth herein, in consideration of the price and other valid
consideration.
 
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein and intending to be legally bound, the Parties agree as
follows:
 
 

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Article 1 - DEFINITIONS
 
 
 
Capitalized terms used and not otherwise defined herein shall have the following
meanings:
 
 
1.1
“Acceptance” (i) with respect to the Satellite shall be as provided in Article
10, and (ii) with respect to any Deliverable Item other than the Satellite shall
be as provided in Article 11.

 
 
1.2
“Actual Costs” shall mean Contractor’s direct and actual costs incurred as
determined in accordance with Contractor’s standard accounting practices
uniformly applied, including allocated G&A and overhead, but excluding profit,
margin, mark-up, or other fees.

 
 
1.3
“Affiliate” means, with respect to an entity, any other entity, directly or
indirectly, Controlling or Controlled by or under common Control with such first
named entity.

 
 
1.4
“Article” means an article of this Contract.

 
 
1.5
“Attachment(s)” means any and all attachment(s) that are attached hereto or to
any Exhibit and incorporated herein or therein, as may be amended from time to
time in accordance with the terms hereof.

 
 
1.6
“Attributable to Purchaser” has the meaning set forth in Article 13.8.

 
 
1.7
“Business Day” means any day other than a Saturday, Sunday or any other day on
which national banks are authorized to be closed in New York City, New York.

 
 
1.8
“Candidate Launch Vehicles” means a launch vehicle compatible with the
Satellite, including Ariane 5 ECA (dual launch configuration), Proton/Breeze M,
Sea Launch, and Atlas V 431 launch vehicles.

 
 
1.9
[***]

 
 
1.10
“Component” means any unit, system, subsystem, or piece of equipment or hardware
or software to be employed on the Satellite or SCF Baseband TC&R Equipment.

 
 
1.11
“Contract” means the terms and conditions (Preamble, Recitals and Articles) of
this executed contract, its Exhibits and its Attachment(s) as set forth in
Articles

 

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2.1 and 33, as may be amended from time to time in accordance with the terms
hereof.

 
 
1.12
[***]

 
 
1.13
“Contractor Intellectual Property” means all Intellectual Property owned by
Contractor and provided to Purchaser in connection with this Contract (before or
after EDC), including the Deliverable Data and Software, and all Intellectual
Property Rights related thereto.  Contractor Intellectual Property shall also
include any derivatives, improvements or modifications of the Contractor
Intellectual Property made by or on behalf of Purchaser or Contractor thereto;
except for derivatives, improvements or modifications that can be used by
Purchaser without infringing or violating the pre-existing Contractor
Intellectual Property Rights.

 
 
1.14
“Contractor” has the meaning set forth in the Preamble and any successor or
assignee permitted hereunder.

 
 
1.15
“Control” and its derivatives mean, with respect to an entity, (i) the legal,
beneficial, or equitable ownership, directly or indirectly, of fifty percent
(50%) or more of the capital stock (or other ownership interest if not a
corporation) of such entity ordinarily having voting rights, or (ii) the power
to direct, directly or indirectly, the management policies of such entity,
whether through the ownership of voting stock, by contract, or otherwise.

 
 
1.16
“Cure Letter” has the meaning set forth in Article 9.1.8.

 
 
1.17
“Daily Rate” has the meaning set forth in Article 13.2.

 

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1.18
“Defect” means (a) with respect to the Satellite, the SCF Baseband TC&R
Equipment, and Satellite Unique Ground Products, any defect or nonconformance in
design, material or workmanship, or failure to meet or perform in accordance
with the applicable specifications of this Contract; or (b) with respect to any
Deliverable Data or Deliverable Services, any failure to meet the applicable
specifications or requirements set forth in this Contract in Articles 15.2.3 or
15.2.4, as applicable.

 
 
1.19
“Deliverable Data” means the data and documentation required to be delivered to
Purchaser as specified in Article 3.1 and Exhibit A, Statement of Work, Section
5.7.

 
 
1.20
“Deliverable Item” means any of the items or services listed in Article 3.1, as
may be amended from time to time in accordance with the terms hereof and,
collectively, the “Deliverable Items.”

 
 
1.21
“Deliverable Services” means those services listed in Article 3.1, as may be
amended from time to time in accordance with the terms hereof.

 
 
1.22
“Delivery” has the meaning set forth in Article 3.2.

 
 
1.23
“Dispute” has the meaning set forth in Article 25.

 
 
1.24
“Effective Date of Contract” or “EDC” is the date set forth in the Preamble.

 
 
1.25
“Escrow Agreement” has the meaning set forth in Article 29.1.1.

 
 
1.26
“Exhibit(s)” means the exhibit(s) identified in Article 2.1 and attached hereto
and incorporated herein, as may be amended from time to time in accordance with
the terms hereof.

 
 
1.27
“Exploit” means with regard to Contractor Intellectual Property to use such
Intellectual Property (1) to launch, use, operate and maintain the Satellite(s),
to encumber or otherwise burden or dispose of each Satellite as an asset of
Purchaser, and to sell, offer for sale, lease, market and rent capacity on,
market and provide services with respect to, and otherwise obtain the benefits
of, the Satellite(s), and, (2) to use, operate, reproduce, modify and maintain,
as applicable, or to encumber or otherwise burden or dispose of, Deliverable
Items in carrying out Purchaser’s business related to the Satellite(s).

 

 
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1.28
Reserved.

 
 
1.29
“FCC” means the Federal Communications Commission or any successor agency or
governmental authority.

 
 
1.30
“Financing Entity” means any one or more of Purchaser’s sources of financing or
funding related to Purchaser’s acquisition of the Satellite or any portion of
the Work hereunder, which has been specifically identified in a written
notification to Contractor.

 
 
1.31
“Firm Fixed Price” has the meaning set forth in Article 4.1.

 
 
1.32
“Force Majeure” has the meaning set forth in Article 17.

 
 
1.33
“Future Orbital Performance Incentives” as of any date means that the Orbital
Performance Incentives that could potentially be earned after such date until
the end of the nominal Orbital Performance Incentive Period (assuming the
Satellite operates in a manner that would allow Contractor to earn Orbital
Performance Incentives under Article 13).

 
 
1.34
“Ground Insurance” has the meaning set forth in Article 32.4.

 
 
1.35
“Ground Storage” means that period where the Satellite is held on the ground for
an extended period prior to Launch.

 
 
1.36
[***]

 
 
1.37
[***]

 
 
1.38
“In-Orbit Testing” or “IOT” means the testing of the Satellite in-orbit in
accordance with Exhibit D, Satellite Test Plan.

 
 
1.39
“IOT Complete Date” has the meaning set forth in Article 10.3.

 
 
1.40
[***] has the meaning set forth in Article 19.1

 
 
1.41
“Integration Activities” has the meaning set forth in Article 3.3.

 
 
1.42
“Intellectual Property” means all designs, techniques, analyses, methods,
concepts, formulae, layouts, software, inventions (whether or not patented or
patentable), discoveries, improvements, processes, ideas, technical data and
documentation, technical information, engineering, manufacturing and other
drawings, specifications and similar matter in which an Intellectual Property
Right

 

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subsists regardless of whether any of the foregoing has been reduced to writing
or practice.

 
 
1.43
“Intellectual Property Claim” has the meaning set forth in Article 19.

 
 
1.44
“Intellectual Property Right(s)” means all common law and statutory proprietary
rights with respect to Intellectual Property, including patent, patent
application, patent registration, copyright, trademark, service mark, trade
secret, mask work rights, data rights, moral rights and similar rights existing
from time to time under the intellectual property laws of the United States, any
state or foreign jurisdiction, or international treaty regime regardless of
whether such rights exist as of the date hereof or arise or are acquired at any
time in the future.

 
 
1.45
“Intentional Ignition” means, with respect to the Satellite, the start of the
ignition process of the Launch Vehicle for the purpose of Launch, which is the
time at which the command signal is sent to the Launch Vehicle.  This definition
shall be modified to reflect the definition of “intentional ignition” in the
Launch Services Agreement applicable to Launch of the Satellite.

 
 
1.46
“Launch” means, with respect to the Satellite, Intentional Ignition followed by
lift-off.  This definition shall be modified to incorporate the definition of
"launch" from the Launch Services Agreement applicable to the Launch of the
Satellite.

 
 
1.47
“Launch and In-Orbit Insurance Policy” has the meaning set forth in Article
32.1.

 
 
1.48
“Launch Agency” means the third party provider of the Launch Services
responsible for the Launch of the Satellite.

 
 
1.49
“Launch Services” means those services, including the provision of a Launch
Vehicle, to be provided by the Launch Agency for the Launch of the Satellite
pursuant to the Launch Services Agreement.

 
 
1.50
“Launch Services Agreement” or “LSA” means the contract between the Purchaser
and the Launch Agency that provides for the Launch Services for the Satellite.

 

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1.51
“Launch Site” means the location that will be used by the Launch Agency for
purposes of launching the Satellite, except in the case of Sea Launch it shall
mean the home port located in Long Beach, CA.

 
 
1.52
“Launch Support” or “Launch Support Services” means those services specified in
Exhibit A, Statement of Work to be provided by Contractor in support of Launch
Services.

 
 
1.53
“Launch Support Products” means the Launch Support Products set forth in Exhibit
A, Statement of Work, Section 5.6.

 
 
1.54
“Launch Vehicle” means the launch vehicle used to Launch the Satellite.

 
 
1.55
“Losses” has the meaning set forth in Article 20.1.

 
 
1.56
“Major Subcontract” and “Major Subcontractors” have the meanings set forth in
Article 38.1.

 
 
1.57
“Milestone” means a portion of the Work upon completion of which a payment is to
be made in accordance with Exhibit E, Price and Payment Plan.  Orbital
Performance Incentives shall not constitute a Milestone.

 
 
1.58
“Mission Support Services” means the orbit-raising, IOT and related services
specified in Exhibit A, Statement of Work, to be performed by Contractor for the
Satellite.

 
 
1.59
[***]

 
 
1.60
[***] has the meaning set forth in Article 24.

 
 
1.61
“NSP” means "not separately priced" and included in the Firm Fixed Price.

 
 
1.62
“Orbital Performance Incentive Period” means, with respect to the Satellite, the
period commencing on the day following the IOT Complete Date for such Satellite
and ending on the last day of the Satellite Stated Life.

 
 
1.63
“Orbital Performance Incentives” means, with respect to the Satellite, an amount
equal to [***], which may be earned by Contractor based on in-orbit performance
of such Satellite as set forth in Article 13.

 
 
1.64
“Orbital Storage” means, with respect to the Satellite, any period of time of
intentional non-use by Purchaser of such Satellite after the IOT Complete Date

 

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provided that such Satellite has been placed into orbit and is capable of
performing in accordance with Exhibit B, Satellite Performance Specification.

 
 
1.65
“Paragraph” means a paragraph under any Article hereof or section in an Exhibit
or Attachment.

 
 
1.66
“Partial Loss” means, with respect to the Satellite on or after Intentional
Ignition, that Transponder Failures have occurred, but the Satellite is not a
Total Loss.

 
 
1.67
“Party” or “Parties” means Purchaser, Contractor or both, as the context
requires.

 
 
1.68
“Payment Plan” means the payment plan for the applicable Deliverable Item, as
set forth in Exhibit E, Price and Payment Plan, as may be amended from time to
time in accordance with the terms hereof.

 
 
1.69
“Performance Specification” means the applicable performance specification for
the Satellite or other Deliverable Item, as appropriate, in the context of the
applicable clause, as such specification may be amended from time to time in
accordance with the terms hereof.

 
 
1.70
“Preamble” means the preamble section of this Contract.

 
 
1.71
“PMO” means the Purchaser’s program management office to be designated by
Purchaser.

 
 
1.72
“Product Assurance Plan” means the product assurance plan attached as Exhibit C,
as may be amended from time to time in accordance with the terms hereof.

 
 
1.73
“Proprietary Information” has the meaning set forth in Article 28.

 
 
1.74
“Purchaser” has the meaning set forth in the Preamble and any successor or
assignee permitted hereunder.

 
 
1.75
“Purchaser Associates” has the meaning set forth in Article 8.1.

 
 
1.76
“Purchaser Delay” has the meaning set forth in Article 18.

 
 
1.77
“Purchaser Intellectual Property” means all Intellectual Property owned by
Purchaser and provided to Contractor in connection with this Contract (before or
after EDC), including all such Purchaser provided Intellectual Property
contained

 

Exhibit 10.1 Logos [logos.jpg]
 
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[***], and all Intellectual Property Rights related thereto.  Purchaser
Intellectual Property shall also include any derivatives, improvements or
modifications of the Purchaser Intellectual Property made by or on behalf of
Purchaser or Contractor thereto; except for derivatives, improvements or
modifications that can be used by Contractor without infringing or violating the
pre-existing Purchaser Intellectual Property Rights.

 
 
1.78
“Recitals” means the recitals section of this Contract.

 
 
1.79
“Required SPSR Complete Date” has the meaning as set forth in Article 22.1.

 
 
1.80
“Satellite” or “Satellites” means any one or more of the communications
satellites that is or are to be manufactured by Contractor and to be delivered
to Purchaser pursuant to this Contract.

 
 
1.81
“Satellite Anomaly” means, with respect to the Satellite in-orbit, a condition
or occurrence that has or may have a material adverse impact on the Satellite
Stated Life or performance of such Satellite.

 
 
1.82
“Satellite Performance Specification” or “Performance Specification” means the
Satellite performance specification attached as Exhibit B, as may be amended
from time to time in accordance with the terms hereof.

 
 
1.83
“Satellite Pre-Shipment Review” or “SPSR” has the meaning set forth in Article
9.

 
 
1.84
“Satellite Test Plan” means the Satellite test plan attached as Exhibit D, as
may be amended from time to time in accordance with the terms hereof.

 
 
1.85
“Satellite Unique Ground Products” means the DSS and the flight dynamics
information as defined in Exhibit A, Statement of Work, Section 5.5.

 
 
1.86
“Satellite Stated Life” or “Satellite Mission Life” means, with respect to the
Satellite, the contracted-for life of [***] for such Satellite, commencing upon
the IOT Complete Date for such Satellite.

 
 
1.87
“Selected Launch Vehicle” has the meaning set forth in Article 3.3.

 
 
1.88
“Satellite Control Facility (SCF) Baseband TC&R Equipment” means the SCF and
TC&R equipment as defined in Exhibit A, Statement of Work, Section 5.2.

 

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1.89
“Software” means the machine readable computer programs (including firmware,
files, databases, interfaces, documentation and other materials related thereto,
and any third party Software sublicensed by Contractor), as such Software is
revised, upgraded, updated, corrected, modified, and enhanced from time-to-time
and provided to Purchaser pursuant to this Contract.

 
 
1.90
“SPSR Complete Date” has the meaning set forth in Article 9.1.6.

 
 
1.91
“Statement of Work” or “SOW” means the statement of work attached as Exhibit A
as may be amended from time to time in accordance with the terms hereof.

 
 
1.92
“Subcontract” means a contract or purchase order awarded by Contractor to a
Subcontractor or a contract or purchase order awarded by a Subcontractor at any
tier for performance of any Work.

 
 
1.93
“Subcontractor” means any person or business entity that has been awarded a
Subcontract.

 
 
1.94
“Technical Assistance Agreement” has the meaning set forth in section 120.22 of
the U.S. International Traffic in Arms Regulations, 22 CFR Parts 120 - 130.

 
 
1.95
“Terminated Ignition” means that, following the time when the electronic signal
is sent to command the opening of any first stage propellant valves, the first
stage engines of the Launch Vehicle are shut down for any reason before the hold
down mechanism is released and the Launch pad is declared safe by the Launch
Agency.  This definition shall be modified to incorporate the definition of
"terminated ignition" from the Launch Service Agreement applicable to the Launch
of the Satellite and/or any launch insurance policy placed by Purchaser (in
accordance with Article 12.1).

 
 
1.96
“Total Loss” means with respect to the Satellite on or after Intentional
Ignition (i) the complete loss, destruction or failure of such Satellite, or
(ii) as defined in Purchaser’s Launch and In-Orbit Insurance Policy in place at
the time of Launch if defined differently therein (including Constructive Total
Loss as defined therein).

 
 
1.97
“Training” means the training to be provided by Contractor in accordance with
Exhibit A, Statement of Work.

 

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1.98
“Transponder” means any one of the primary [***] Ka-Band connections ([***]) in
the forward direction together with a corresponding [***] Ka-Band connection
([***]) in the return direction as specified in Section 3 of Exhibit B,
Satellite Performance Specification.  A Transponder receives signals from a
single gateway beam and radiates those signals to a single user beam in the
forward direction, and the same Transponder receives signals from that same user
beam and radiates those signals to that same gateway beam in the return
direction.

 
 
1.99
“Transponder Failure” means the failure of a Transponder, for reasons not
Attributable to Purchaser, at any time to meet any of the following requirements
of Exhibit B, Satellite Performance Specifications:

 
 
1.99.1
[***].

 
 
1.99.2
[***].

 
 
1.99.3
[***].

 
 
1.99.4
[***].

 
 
1.99.5
[***].

 
 
1.100
“UCC” means the Uniform Commercial Code as in effect in the State of New York,
as it may be amended from time to time.

 
 
1.101
“Work” means all design, development, construction, manufacturing, labor, and
services, including tests to be performed, and any and all Deliverable Items,
including the Satellite, SCF Baseband TC&R Equipment, Satellite Unique Ground
Products, Deliverable Data, Mission Support Services, Launch Support Services,
Training, and equipment, materials, articles, matters, services, and things to
be furnished and rights to be transferred to Purchaser under this Contract.

 
 
 

Exhibit 10.1 Logos [logos.jpg]
 
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Article 2 - SCOPE OF WORK
 
 
2.1
Provision of Services and Materials

 
Contractor shall provide Purchaser with the Deliverable Items completed in all
respects in accordance with the provisions of this Contract.  Without limiting
the generality of the foregoing Contractor shall provide the necessary
personnel, material, services, and facilities to design, manufacture, test and
ship one (1) Satellite, together with all other Deliverable Items referred to in
Article 3.1 and listed in Exhibit A, Statement of Work.  Contractor shall
furnish and perform the Work in accordance with the provisions of this Contract,
including the following Exhibits, which are attached hereto and made a part
hereof:
 
 
2.1.1
Exhibit A, Statement of Work, dated as of EDC.

 
 
2.1.2
Exhibit B, Satellite Performance Specification, dated as of EDC.

 
 
2.1.3
Exhibit C, Product Assurance Plan, dated as of EDC.

 
 
2.1.4
Exhibit D, Satellite Test Plan, dated as of EDC.

 
 
2.1.5
Exhibit E, Price and Payment Plan, dated as of EDC.

 
 
2.1.6
Exhibit F, Escrow Agreement, dated as of EDC

 
 
2.1.7
Exhibit G, [***]

 
 
2.1.8
Exhbiit H, [***]

 
 
 
 
2.2
Cooperation with Launch Agency

 
Contractor shall provide all reasonably necessary assistance to, and shall fully
communicate and cooperate with, the Launch Agency so as to ensure successful,
on-time completion of the Work and integration of the Satellite with the Launch
Vehicle and the provision of the Launch Support Services in accordance with the
terms of this Contract.  Purchaser shall provide all reasonably necessary
assistance to Contractor so as to ensure Contractor and any affected
Subcontractors have the necessary access and information from the Launch Agency
to perform as specified.  All communications of Contractor and its
Subcontractors with the Launch Agency are subject to any required export
authorizations.
 

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2.3           Satellite Configuration
 
[***]
 
 
2.4
[***]

 
[***]
 

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Article 3 - DELIVERABLE ITEMS AND DELIVERY SCHEDULE
 
 
3.1
Deliverable Items

 
Subject to the other terms and conditions of this Contract, the items to be
delivered under this Contract are specified below (each a “Deliverable
Item”).  Contractor shall deliver such Items on or before the corresponding
Delivery dates and at locations specified below:
 

 
Required Deliverable Items
Delivery Date
Delivery Location
1
Satellite
EDC [***]
months
 
Per Article 3.2 or Placement in Storage (as applicable)
Launch Site or Ground Storage Location (as applicable)
2
SCF Baseband TC&R equipment
Per Exhibit A, Section 5.2
Purchaser TC&R facilities
3
Satellite Recommended Operating Procedures
Per Exhibit A, Section 5.3
Per Exhibit A, Section 5.3
4
Satellite Systems Engineering Database (SSED)
Per Exhibit A, Section 5.4
Per Exhibit A, Section 5.4
5
Satellite Unique Ground Products
Per Exhibit A, Section 5.5
Per Exhibit A, Section 5.5
6
Launch Support Products
Per Exhibit A, Section 5.6
Purchaser Program Management Office (PMO) and/or Launch Agency offices, as
directed by Purchaser
7
Deliverable Data (CDRLs)
Per Exhibit A, Section 5.7
Purchaser Program Management Office (PMO)
8
Launch Support Services
Per Exhibit A, Section 3.2
Per Exhibit A, Section 3.2
9
Mission Support Services
Per Exhibit A, Section 3.3
Per Exhibit A, Section 3.3
10
Training
Per Exhibit A, Section 3.13
Per Exhibit A, Section 3.13
11
Scale Models
Per Exhibit A, Section 5.8
Purchaser Program Management Office (PMO)

 
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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3.2           Delivery
 
Delivery of each Deliverable Item, except the Satellite, shall occur upon
arrival of such Deliverable Item at the location specified in Article 3.1, after
having successfully completed any required reviews, testing and acceptance
procedures.  In the case of the Satellite, Delivery shall occur upon successful
completion of visual inspection by Contractor following arrival of the Satellite
at the Launch Site and removal from the shipping container (or placement of the
Satellite into storage pursuant to Article 35) following successful completion
of SPSR pursuant to Article 9.
 
 
3.3
Launch Services

 
Purchaser shall be responsible for obtaining Launch Services for Launch of the
Satellite.  Contractor shall provide (in addition to Launch Support Services),
within the Firm Fixed Price, engineering, Launch Vehicle integration activities,
and other customary services to maintain compatibility of the Satellite for
Launch (including but not limited to environmental analysis, mission planning,
and Launch Vehicle electrical and mechanical interfaces) (collectively,
“Integration Activities”) with the list of Candidate Launch Vehicles up to [***]
prior to the scheduled Delivery date of the Satellite set forth in Article
3.1.  On or before [***] prior to the then-currently scheduled Delivery date of
the Satellite set forth in Article 3.1 (the “[***]”), Purchaser shall provide a
written notification to Contractor of [***] Launch Vehicles that may be used for
such Satellite, provided that, if Purchaser notifies Contractor of the [***]
Launch Vehicles prior to the last day of the [***], Purchaser reserves the right
to change such selection up to and including the last day of the [***] without
impact to the Contract price or schedule.  Provided that Purchaser has made the
necessary arrangements with the potential Launch Agencies to reasonably support
Contractor’s Integration Activities, Contractor shall perform dual Integration
Activities up through [***] prior to the then-currently scheduled Delivery date
of the Satellite, at which time Purchaser shall designate its final Launch
Vehicle selection (“Selected Launch Vehicle”).  Failure to notify Contractor of
its Launch Vehicle selection(s) within [***] after written notice from
Contractor on or after the applicable date(s) set forth in this paragraph shall
be a Purchaser delay of Work subject to Article 18.  In the event that Purchaser
subsequently changes its Launch Vehicle selection, it shall be considered a
change subject to Article 16.
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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3.4           Avoidance and Mitigation of Delays
 
As provided in Exhibit A, Statement of Work, Section 4.0 and the Program
Management Plan (CDRL 5), Contractor shall notify Purchaser promptly by
telephone and confirm in writing any event, circumstance or development that
will likely result in a material non-conformance of the Work or any part thereof
with the requirements of this Contract or the Delivery dates established
hereunder. [***]
 
 
3.5
Packing and Shipping

 
Packing and shipping shall be in accordance with all applicable laws, rules, and
regulations, and standard commercial practices in the aerospace industry.
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 4 - PRICE
 
 
4.1
Firm Fixed Price

 
The price to be paid by Purchaser to Contractor for Deliverable Items 1 through
11 set forth in Article 3.1 hereof, including all the Work as defined in Exhibit
A, Statement of Work, shall be a total firm fixed price of two hundred and
forty-nine million, five hundred thousand U.S. dollars (U.S. $249,500,000) (the
“Firm Fixed Price”).  The prices for those items subject to an option under this
Contract, if any, are described in Exhibit E, Price and Payment Plan.  The
itemization of the Firm Fixed Price is detailed in Exhibit E, Price and Payment
Plan.
 
 
4.2
Launch Support Services

 
Upon Purchaser’s selection of the Launch Vehicle for the Launch of the Satellite
as provided in Article 3.3 above, the Firm Fixed Price of the Contract shall be
increased or decreased in the applicable amount set forth in Exhibit E, Price
and Payment Plan to reflect the Launch Support Services associated with the
selected Launch Vehicle. Such increase or decrease shall be applied to Milestone
#13, Delivery to the Launch Site, as specified in Table 2 of Exhibit E, Price
and Payment Plan.
 
 
4.3
Fees and Other Expenses

 
Except as otherwise expressly provided in this Contract, the Firm Fixed Price is
not subject to any escalation or to any adjustment or revision.  The Firm Fixed
Price stated above includes all fees, charges, expenses, costs, and other
amounts payable by Purchaser to Contractor for any portion of the Work including
but not limited to the design, manufacturing, and tests of the Satellite, other
Deliverable Items, Orbital Performance Incentives, Mission Operations Support
Services, Launch Support Services (per Exhibit A), Integration Activities, risk
management services as required by Article 32, packing and transport of the
Satellite to the Launch Site, transit insurance and such other insurance as is
required by Article 32.4, but does not include Launch Services, or any insurance
coverage for loss or damage to the Satellite from and after Intentional
Ignition, the responsibility for which shall reside exclusively with Purchaser,
all in accordance with the terms and conditions of this Contract, as specified
herein.
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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4.4           Taxes
 
The Firm Fixed Price includes, and Contractor shall remit when due, all
applicable taxes, duties and similar liabilities (including interest, fines,
penalties, or additions attributable to, or imposed on, or with respect to, any
such taxes, duties and similar liabilities) imposed by any federal, state, local
or foreign government in connection with Contractor’s performance of the Work,
wherever the Work is being carried out under this Contract.
 
 
 
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 5 - PAYMENTS
 
 
5.1
Payment Plan

 
Payments by Purchaser to Contractor of the Firm Fixed Price set forth in Article
4 and of the amounts for options, if any, exercised by Purchaser pursuant to
this Contract shall be in accordance with Exhibit E, Price and Payment Plan, as
applicable thereto.
 
 
5.2
Payment Conditions

 
 
5.2.1
Reserved

 
 
5.2.2
Milestone Payments.  Each Milestone payment specified in Exhibit E, Price and
Payment Plan, shall in each case become payable upon Contractor’s completion of
each Milestone in accordance with the Contract and satisfaction of the
conditions for Milestone completion set forth in the Reference column of Table
6.1 of Exhibit A, after which Contractor shall submit an invoice for
payment.  [***]  Contractor's invoice for any payment due from Purchaser upon
the completion of a Milestone described in Exhibit E, Price and Payment Plan,
shall be accompanied by (a) certification in the form attached hereto as
Attachment A that the Milestone has been completed in accordance with the
requirements of this Contract, and (b) the necessary or appropriate supporting
data and documentation as required hereunder, if any, or as Purchaser may
reasonably request within ten (10) Business Days of receipt of
invoice.  Purchaser shall pay in full such invoice (or, if applicable, the
undisputed portion thereof) within [***] after receipt of the required invoice,
certification and (as applicable) data and documentation.

 
 
5.2.3
Orbital Performance Incentives.  Purchaser shall pay, in full, invoices for
Orbital Performance Incentives (or, if applicable, the undisputed portion
thereof) within [***] after receipt of the required invoice.

 
 
5.2.4
Non-Warranty and Other Payments.  All undisputed amounts payable to Contractor
with respect to non-warranty work performed pursuant to Article 15.3 or for any
other payments to be made to either Party pursuant to this Contract and not
otherwise subject to Article 5.2.1 through 5.2.3 above shall

 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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be paid no later than [***] after receipt of an invoice in accordance with the
requirements of this Contract.

 
 
5.3
Late Payment

 
 
5.3.1
Interest.  Except in the case of a payment disputed pursuant to Article 5.6
below, in the event that any payment due under this Contract is not made when
due hereunder, without prejudice to the other rights and remedies of the Party
entitled to such payment, such Party shall also be entitled to interest at the
rate of [***] ([***]%) per annum, compounded [***], on the unpaid balance
thereof [***].

 
 
5.3.2
Stop Work.  Except in the case of (i) a Force Majeure event as provided in
Article 17 (provided that the Force Majeure event is not Purchaser's failure to
make payment) or (ii) a disputed payment pursuant to Article 5.6, if any payment
is not made by Purchaser by the date [***] after the date due in accordance with
Article 5.2 (or such longer period as the Parties may agree), without prejudice
to Contractor’s other rights and remedies, Contractor upon five (5) Business
Days prior written notice to Purchaser may elect to cease performance of its
obligations under this Contract, without prejudice or penalty.  If Contractor is
subsequently directed to resume performance, the price, schedule, and other
affected terms of this Contract shall be equitably adjusted for to the extent of
the actual impacts on Contractor associated with such Work stoppage, including
Actual Costs reasonably incurred in connection with such Work stoppage, plus a
markup of [***] ([***]%), with such costs and markup to be invoiced and paid
pursuant to the provisions of this Article 5.

 
 
5.4
Invoices

 
Invoices required to be delivered by Contractor hereunder shall be submitted by
facsimile and air mail to Purchaser (original plus one (1) copy) at the
following address:
 

 
Hughes Network Systems, LLC
 
Attn.: Jupiter Program Manager
 
11717 Exploration Lane
 
Germantown, Maryland 20876
 
Fax:  (301) 428-7066

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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or to such other address as Purchaser may specify in writing to Contractor.
 
5.5           Payment Bank
 
All payments made to Contractor hereunder shall be in U.S. currency and shall be
made by electronic funds transfer to the following account:
 
SPACE SYSTEMS/LORAL, INC.
ACCOUNT NO. [***]
 
 
or such other account or accounts as Contractor may specify in writing to
Purchaser.

 
5.6
Disputed Amounts

 
If the event covered by a Milestone payment has not been completed in accordance
with the requirements of this Contract, Purchaser shall so notify Contractor in
writing within fifteen (15) days of receipt of the applicable invoice and may
withhold some or all of the applicable payment in good faith.  Such notification
shall state in reasonable detail the Contract requirements associated with the
applicable Milestone event that have not been met.  Upon correction of the noted
discrepancy(ies) and completion of the Milestone in accordance with Contract
requirements, the Milestone invoice shall (by written notice from Contractor to
Purchaser) be reinstated for payment, [***].  Failure by Purchaser to pay any
amount subject to a reasonable good-faith dispute shall not constitute a breach
of this Contract pending resolution.
 
 
5.7
Right of Offset

 
In the event that Contractor has not paid the Purchaser any amount that is due
and payable to the Purchaser under this Contract, without prejudice to other
rights and remedies, Purchaser shall have the right to set off such amount
against any payment(s) due and payable or to become due and payable to
Contractor under this Contract.
 
 
5.8
Audit Rights and Procedures

 
Contractor shall keep complete, true and accurate books of account and records
pursuant to its standard accounting system for the purpose of showing the
derivation of all Actual Costs where any payments to be made by Purchaser are
based on Actual Costs ([***]). Contractor will keep such books and records at
Contractor’s principal place of business for at least [***] following the end of
the calendar quarter to which they pertain and make them available at all
reasonable times for audit by an independent auditor reasonably acceptable to
Purchaser and Contractor.  Purchaser may direct an

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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audit of any Actual Costs claimed by Contractor pursuant to this Contract to be
performed by an industry recognized independent certified public accounting firm
reasonably acceptable to Contractor. Any such audits will be at the expense of
Purchaser unless [***]. In such case, the expense of the audit will be paid by
Contractor. Contractor will promptly pay Purchaser the full amount of any
overpayment, together with interest at the annual rate of [***]([***]%) [***],
compounded quarterly, from the date such overpayment was made.  The independent
auditor will be directed to report reasons for its findings, and the independent
auditor’s findings will be binding upon Purchaser and Contractor, provided that
Contractor shall have the right to redact any detailed rate information ([***])
from any report or finding provided by the independent auditor to Purchaser.
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 6 - PURCHASER-FURNISHED ITEMS
 
 
6.1
Purchaser-Furnished Support

 
Purchaser shall timely make available to Contractor the Purchaser-furnished
equipment, facilities and services described in Section 8.0 of Exhibit A,
Statement of Work.  Such equipment, facilities and services shall be in good
working condition and adequate for the required purposes and, for the Launch of
the Satellite hereunder, shall be made available free of charge for Contractor’s
use during the period commencing on the date(s) referred to in Section 8.0 of
Exhibit A, Statement of Work and continuing through the IOT Complete Date for
the Satellite.  Purchaser and Contractor will conduct an interface meeting at
the time of Mission Readiness Review to confirm the availability and adequacy of
such Purchaser-furnished equipment, facilities and services.
 
 
6.2
Communications Authorizations

 
Consistent with industry standards, Contractor shall, at no additional cost to
Purchaser, provide all cooperation and active support reasonably necessary in
support of Purchaser's preparation, coordination and filing of applications,
registrations, reports, licenses, permits and authorizations with the FCC or
other U.S. or foreign governmental agencies having jurisdiction over Purchaser
for the Launch and operation of the Satellite.
 
 
6.3
Radio Frequency Coordination

 
Consistent with industry standards, Contractor shall, at no additional cost to
Purchaser, provide all cooperation and active support reasonably necessary in
support of Purchaser’s efforts in the preparation and submission of filings
required by the International Telecommunication Union (or any successor agency
thereto) and all relevant communications regulatory authorities regarding radio
frequency and orbital position coordination having jurisdiction over Purchaser.
 
 
6.4
Satellite Performance Data

 
Commencing with the first full calendar month following the IOT Complete Date,
Purchaser will use reasonable efforts to provide a report to Contractor
describing the general health and operating status of the Satellite.  Such
report will be provided to Contractor on a regular basis thereafter, delivered
to Contractor promptly no later than after the end of every three (3) months
during the Satellite Stated Life.  In the event of a Satellite Anomaly that
occurs during the Satellite Stated Life, Purchaser shall timely
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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provide Contractor with or give Contractor access to any data Contractor may
reasonably require to investigate and correct (per Article 15.2 hereof) such
Satellite Anomaly and/or support Purchaser in making and perfecting claims for
insurance recovery relating to such Satellite Anomaly as set forth in Article
32.2.  Contractor shall maintain all performance and anomaly data received from
Purchaser as strictly confidential in accordance with Article 28.
 
 
6.5
Late Delivery of Purchaser-Furnished Items or Services

 
Exhibit A, Statement of Work, Section 8.0 sets forth a complete listing of all
Purchaser-furnished items or services and the delivery date for such items and
services.  The late delivery of Purchaser-furnished items or services,
individually or combined, shall be considered an event beyond the reasonable
control of Contractor, and Contractor shall be entitled to such adjustments, if
any, in the Firm Fixed Price and schedule and other materially affected terms of
this Contract as may apply in accordance with Article 18 provided that: [***].
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 7 - COMPLIANCE WITH U.S LAWS AND DIRECTIVES
 
 
7.1
General

 
Each Party shall, at its expense, perform its obligations hereunder in
accordance with all applicable laws, regulations, and policies of the United
States and the conditions of all applicable United States Government approvals,
permits, or licenses.
 
 
7.2
Compliance with U.S. Laws

 
Any obligation of Contractor hereunder to provide hardware, software,
Deliverable Data, other technical information, technical services, Training, or
any access to facilities to Purchaser and its personnel and/or its
representatives shall be subject to applicable U.S. Government laws,
regulations, policies and license conditions/provisos (including, but not
limited to those related to export controls, economic sanctions and
security).  Any obligation of Purchaser hereunder, including the provision of
Purchaser furnished equipment, facilities, and services items or any access to
facilities of Contractor by its personnel and/or its representatives, shall be
subject to applicable U.S. Government laws, regulations, policies and license
conditions/provisos (including, but not limited to those related to export
controls, economic sanctions and security).  The Parties shall work
cooperatively and in good faith to implement this Contract in compliance with
such laws, regulations, policies and license conditions.  If and to the extent
required by U.S. law, Contractor and Purchaser [***] and its personnel and/or
representatives shall enter into U.S. Government-approved agreement(s),
including a Technical Assistance Agreement(s), separate from this Contract,
governing Contractor’s provision of hardware, software, Deliverable Data, other
technical information, technical services, Training, Launch support or access to
facilities in connection with this Contract.
 
 
7.3
Licenses and Other Approvals

 
Contractor shall use reasonable efforts to obtain and maintain all applicable
approvals, permits, and licenses as may be required by any government, foreign
or domestic, for the performance of the Work including but not limited to all
authorizations required for the import or export of any Deliverable Item, or any
part thereof, (including delivery of the Satellite and Launch support equipment
that is Contractor’s obligation to provide hereunder to the Launch Site and any
agreements and other approvals necessary to perform Integration Activities and
Launch Support Services, as well as any agreements
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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and other approvals of the U.S. Government that are required for Purchaser [***]
and “foreign person” personnel and/or representatives of Purchaser [***]
(including, but not  limited to, foreign subsidiaries and related entities of
Purchaser involved with the procurement) as well as Purchaser’s [***] insurance
providers, to have access to Contractor facilities, hardware, software,
Deliverable Data, Training, other technical information or technical services in
connection with the performance of this Contract.  In addition, Contractor shall
provide reasonable support to Purchaser [***] in obtaining any necessary
approvals, permits, and licenses for the performance of Purchaser’s obligations
hereunder.  A “foreign person” shall be as defined in the U.S. International
Traffic in Arms Regulations, 22 C.F.R. §120.16.  As soon as practicable
Purchaser shall provide Contractor with a list of countries (if other than the
U.S.) of which “foreign person” personnel and/or representatives of Purchaser
(including, but not limited to foreign subsidiaries and related entities of
Purchaser [***] involved with the procurement) as well as Purchaser’s [***])
insurance providers, if such personnel, representatives, and/or insurance
providers will or may have access to U.S. export-controlled items or services
under this Contract.  Purchaser ([***]) shall provide such reasonable
cooperation and support as necessary for Contractor to apply for and maintain
such required U.S. export licenses, agreements and other approvals, and shall
promptly notify Contractor of any occurrence or change in circumstances of which
it becomes aware that is relevant to or affects such export licenses, agreements
and approvals.  Contractor shall review with Purchaser any application
Contractor makes to any government department, agency or entity for any permit,
license, agreement or approval that will be signed by Purchaser as may be
required for performance of the Work, prior to submission of such
application.  Contractor shall provide Purchaser a minimum of five (5) Business
Days to review such application prior to submission to such governmental entity,
and Contractor shall in good faith consider any comments and proposed revisions
made by Purchaser for incorporation into such application.  At Purchaser’s
request, Contractor shall include Purchaser [***] (and related entities involved
with the procurement) as a named party(ies) in any application to the U.S.
Government for approval of such export licenses, agreements and other approvals
so as to permit Purchaser [***] (and related entities involved with the
procurement) to be present during any discussion with or meetings where
Purchaser’s [***] foreign subsidiaries/related entities, or insurance providers,
may receive from, or discuss, Contractor any export-
 
Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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controlled items and/or services.  Contractor shall provide the parties to such
export licenses and agreements copies of the export licenses and agreements,
including any U.S. Government approvals and provisos related to same.
 
NOTWITHSTANDING ANY PROVISION IN THIS CONTRACT, IN NO EVENT SHALL EITHER PARTY
BE OBLIGATED UNDER THIS CONTRACT TO PROVIDE ACCESS TO ITS OR ITS SUBCONTRACTOR
FACILITIES, PROVIDE ACCESS TO OR FURNISH HARDWARE, SOFTWARE, DELIVERABLE DATA OR
OTHER TECHNICAL INFORMATION, OR PROVIDE TECHNICAL/DEFENSE SERVICES OR TRAINING,
TO ANY PERSON EXCEPT IN COMPLIANCE WITH ALL APPLICABLE U.S. LAWS, REGULATIONS,
POLICIES AND LICENSE CONDITIONS.
 
 
7.4
No Unauthorized Exports or Retransfers

 
NEITHER PARTY NOR ANY [***] SHALL RE-EXPORT OR RE-TRANSFER TO ANY FOREIGN PERSON
THIRD PARTY ANY HARDWARE, SOFTWARE, DELIVERABLE DATA, OTHER TECHNICAL
INFORMATION OR TECHNICAL SERVICES FURNISHED HEREUNDER, EXCEPT AS EXPRESSLY
AUTHORIZED BY THE U.S. GOVERNMENT IN ACCORDANCE WITH THE EXPORT LICENSES,
AGREEMENTS AND OTHER APPROVALS REFERENCED IN ARTICLES 7.2 AND 7.3 OR AS
OTHERWISE EXPRESSLY AUTHORIZED UNDER APPLICABLE U.S. LAWS.
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 8 - ACCESS TO WORK-IN-PROGRESS
 
 
8.1
Work in Progress at Contractor’s Facility

 
Subject to Article 7, compliance with Contractor’s normal and customary safety
and security regulations and practices (or, if applicable, those of a Major
Subcontractor), which shall be provided in writing to Purchaser upon Purchaser’s
request prior to any facility visit, and the protection of third party
proprietary information, Purchaser personnel (and Purchaser’s duly appointed
consultants and agents (who are not Competitors of Contractor) and
representatives, hereinafter referred to collectively as “Purchaser Associates”)
shall be allowed access to all Work being performed at Contractor’s facility or
any Major Subcontractor’s facility for the Satellite and other Deliverable
Items, for the purpose of observing the progress of such Work; provided,
however, access by Purchaser and/or Purchaser Associates personnel to any Major
Subcontractor facility shall require such Major Subcontractor’s prior written
consent, which Contractor shall make reasonable efforts to obtain, and
Contractor shall be entitled to accompany any Purchaser and/or Purchaser
Associates personnel to the facility.  Such access shall be upon reasonable
prior written notice to Contractor and shall occur during normal working hours
or at such other hours as Contractor may agree.  Subject to Article 7,
compliance with Contractor’s normal and customary safety and security
regulations and practices (or, if applicable, those of a Major Subcontractor),
which shall be provided in writing to Purchaser and Purchaser Associates upon
Purchaser’s request prior to any facility visit, and the protection of third
party proprietary information, Purchaser and Purchaser Associates personnel
shall have reasonable access, for evaluation, inspection, and use in connection
with the planned operation of the Satellite, to (i) Deliverable Data; (ii)
work-in-progress and technical and schedule data and documentation relevant to
the Work; (iii) drawings, circuit diagrams/schematics, specifications, standards
or process descriptions applicable to the Work; and (iv) data and documentation
provided to Contractor by its Subcontractors applicable to the Work.  Subject to
Article 7, Contractor shall provide Purchaser (and Purchaser Associates
identified by Purchaser) access to a program web site (from which Purchaser and
any of its authorized Purchaser Associates) will be permitted to download,
print, and save documents to serve as a repository for such information and
Contractor shall provide a typical site map or index to the contents of that web
site. All Purchaser and Purchaser Associates personnel who
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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are “U.S. persons” under the ITAR and otherwise meet the requirements for access
set forth in this Article shall be provided non-escort badges to agreed work
areas while the Work is being performed, though such access may be restricted to
relevant buildings and areas where the subject Work-in-Progress resides.  For
safety and security and quality control purposes, Contractor requires two (2)
Contractor representatives to be present in certain areas of Contractor’s
factory (which will be notified to Purchaser in advance) any time Purchaser or
Purchaser Associates  personnel are present in such areas.  In all other areas
of the factory (except for Purchaser on-site office facilities), there must be
at least one (1) Contractor representative present, if Purchaser personnel are
present.  Contractor will use reasonable efforts to obtain similar access to
Work that is being performed at the facilities of Contractor’s Major
Subcontractors subject to the conditions set forth in the first sentence of this
Article.  For the avoidance of doubt, any communication between Purchaser or
Purchaser Associates personnel and any foreign Subcontractor shall be conducted
through Contractor.  Contractor shall obtain and maintain any such
authorizations pursuant to Article 7 necessary for any communications between
Purchaser or Purchaser Associates personnel and any foreign Subcontractor.
 
 
8.2
Electronically-Generated Information

 
With regard to electronically generated information, Contractor will provide
Purchaser and Purchaser Associates with an electronic copy thereof and/or
electronic access (via the internet or Purchaser e-mail) to information
regarding program performance and documentation that will advise Purchaser, on a
current basis, of program specific issues, decisions and problems. Contractor
shall establish data links between its and Purchaser’s facilities such that
Purchaser has remote electronic access to those project-related documents
identified in Exhibit A, Statement of Work. Subject to Article 7, Contractor
shall also provide Purchaser and Purchaser Associates personnel with “real time”
access to all measured data, when feasible, for the Work on a non-interference,
no-cost basis.
 
 
8.3
On-Site Facilities for Purchaser’s Personnel

 
For the purpose of monitoring the progress of the Work being performed by
Contractor hereunder, Contractor shall provide office facilities at or proximate
to Contractor’s plant for up to [***] resident Purchaser personnel (and/or
Purchaser Associates) through the
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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IOT Complete Date.  The office facilities to be provided shall include a
reasonable amount of office space, office furniture, local telephone service,
reasonable long-distance telephone usage, access to copy machines, facsimile
machines, internet account and access, reasonable clerical support and meeting
rooms to the extent necessary to enable Purchaser, including Purchaser
Associates, personnel to monitor the progress of Work under this
Contract.  Contractor shall use reasonable efforts to obtain similar office
facilities at the plants of Contractor’s Major Subcontractors for visits and
meetings of Purchaser, including Purchaser Associates and Contractor to such
plants.
 
 
8.4
Purchaser Representatives as Competitors/Foreign Persons

 
Purchaser shall use reasonable efforts to verify that Purchaser Associates used
in connection with this Contract are not currently employed by companies or
entities that are Competitors.  Purchaser shall notify Contractor in writing of
the name, title or function, business relationship, employer, citizenship status
under U.S. export laws and such other information as may be reasonably requested
by Contractor, with respect to each of its intended Purchaser Associates, and
cause each such Purchaser Associates to: (i) execute a confidentiality agreement
(except for attorneys and other professionals who are already bound by
obligations of confidentiality) directly with Contractor in form and substance
reasonably satisfactory to Contractor and containing terms substantially the
same as those set forth in Article 28 and Article 39; and (ii) pursuant to
Article 7 and if and to the extent required by U.S. law, execute a Technical
Assistance Agreement or other agreement to ensure compliance with applicable
U.S. export control laws and regulations to the extent required by applicable
U.S export laws or regulations.  Contractor may in its reasonable discretion
deny any Purchaser Associates access to Contractor or Subcontractor's
facilities, products or information if such consultant or agent is currently
employed by a Competitor, or fails to abide by the applicable safety and
security policies or if such consultant or agent fails to execute any of the
agreements identified in (i) and (ii) above, where necessary. Notwithstanding
the foregoing, Purchaser Associates who are also employed or engaged by
Contractor Competitors [***] shall not be denied access to Contractor or a
Subcontractor’s facilities, products or information if Purchaser notifies
Contractor of the identity of such Purchaser Associates, identifies the
Competitor(s) that such Purchaser Associates are employed
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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by, and Purchaser implements appropriate protective measures (firewalls) to
safeguard the confidentiality of Contractor’s data, documentation and
information as required by this Contract.
 
 
8.5
Meetings and Presentations

 
Purchaser shall be entitled to reasonable prior written notice of and to attend
(accompanied by Purchaser Associates): (a) all formal program-specific meetings;
and (b) reviews required in Exhibit A, Statement of Work. Purchaser, and any
attendant Purchaser Associates, shall have the right to participate in and to
make recommendations in all such meetings and reviews at the system, subsystem
and unit level. In addition, Contractor and Purchaser shall mutually agree on
which informal program-specific meetings to which Purchaser (accompanied by
Purchaser Associates) will be invited to attend. Copies of presentations or
other documents utilized during these meetings shall be furnished or made
available to Purchaser and Purchaser Associates. Purchaser’s management
personnel and Purchaser Associates, as may be deemed appropriate by Purchaser,
shall be invited to the Quarterly Reviews. Contractor shall be represented by
its Program Manager and such other personnel as are required to support the
particular presentation.  Contractor shall provide to Purchaser, upon request,
copies of all documentation utilized during and/or a summary of informal
program-specific meetings of a material nature for which Contractor cannot
provide prior notice and where Purchaser’s or Purchaser Associates’ personnel
are not otherwise aware.
 
 
8.6
Interference with Operations

 
Purchaser shall exercise its rights under this Article 8 in a manner that does
not unreasonably interfere with Contractor’s or its Subcontractors’ normal
business operations or Contractor’s performance of its obligations under this
Contract or any agreement between Contractor and its Subcontractors.
 
 
8.7
Purchaser Inspection Not Acceptance

 
The inspection, examination, or observation by Purchaser with regard to any
portion of Work produced under this Contract, and Purchaser’s or Purchaser
Associates’ participation in, and comment at, meetings with Contractor, shall
not constitute any Acceptance of the Work, nor shall it relieve Contractor from
fulfilling its contractual obligations hereunder.
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 9 - SATELLITE PRE-SHIPMENT REVIEW (SPSR) AND DELIVERY
 
 
9.1
Satellite Pre-Shipment Review (SPSR)

 
 
9.1.1
Contractor to Conduct a Review of the Satellite Prior to Shipment.  Contractor
shall conduct a detailed and comprehensive review of the Satellite with
Purchaser (and Purchaser Associates designated by Purchaser) prior to
Contractor’s shipment of the Satellite to the Launch Site or its entering into
storage.  This review shall be conducted in accordance with the terms of this
Article 9 and Section 3.6.1 of Exhibit A, Statement of Work to accomplish the
purposes set forth in Article 9.1.3 (a “Satellite Pre-Shipment Review” or
“SPSR”).

 
 
9.1.2
Time, Place and Notice of SPSR.  The SPSR shall take place at Contractor’s
facility.  Contractor shall notify Purchaser in writing on or before thirty (30)
days prior to the date that the Satellite will be available for the SPSR, which
shall be the scheduled date for commencement of such SPSR.  If Purchaser cannot
attend the SPSR on such initially scheduled date, Contractor shall make
reasonable efforts to accommodate Purchaser’s availability taking into
consideration the requirement to Deliver the Satellite on or before the date set
forth in Article 3.1.

 
 
9.1.3
Conduct and Purpose of SPSR.  The SPSR shall be conducted in accordance with the
terms of this Article 9 and Section 3.6.1 of Exhibit A, Statement of Work.  The
purpose of the SPSR shall be to: (i) review test data and analyses for the
Satellite; (ii) demonstrate testing has been completed in accordance with the
applicable portions of Exhibit D, Satellite Program Test Plan; and (iii)
determine whether the Satellite meets applicable Exhibit B, Satellite
Performance Specification requirements (except those that have been waived
pursuant to Article 9.1.4 below) and is therefore ready for shipment to the
Launch Site.

 
 
9.1.4
Waivers and Deviations.  Contractor shall timely submit requests for waivers of,
or deviation from, provisions of the Performance Specification applicable to the
Satellite or other Deliverable Item and, in the notice provided to Purchaser for
scheduling of the SPSR as provided in Article 9.1.2, Contractor

 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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    shall include: (i) a summary of waiver and/or deviation requests that have
been submitted to Purchaser and which are still pending; and (ii) submittals of
any new or additional requests for waivers of, or deviation from, provisions of
the Performance Specification applicable to the Satellite or other Deliverable
Item at the time of such notice and for which Contractor desires relief.  A
request for waiver or deviation shall be deemed granted only if it has been
approved in writing by a duly authorized representative of Purchaser.  Each such
waiver or deviation approved by Purchaser shall be deemed an amendment to the
Performance Specification for such Satellite or Deliverable Item, permitting
such waiver thereof, or deviation therefrom, effective on or after the date of
such approval for such Satellite or Deliverable Item.  Purchaser shall consider
each waiver or deviation request in good faith in accordance with industry
practices.  The grant of a waiver or deviation may involve Contractor providing
reasonable consideration.

 
 
9.1.5
Purchaser’s Inspection Agents.  Purchaser and any Purchaser Associates
designated by Purchaser shall be entitled to participate in the SPSR pursuant to
this Article 9; provided, however, that the provisions of Article 7 and Article
8.4 shall apply to any such consultant or agent.

 
 
9.1.6
SPSR Results.  In the event that the SPSR demonstrates that: (i) testing has
been performed in accordance with the applicable sections of Exhibit D,
Satellite Program Test Plan, and (ii) the Satellite conforms to the applicable
requirements of Exhibit B, Satellite Performance Specification (including any
waivers or deviations approved by Purchaser pursuant to Article 9.1.4),
Contractor shall provide written notification to Purchaser of completion of the
SPSR.  Purchaser shall, within [***] Business Days from receipt of such
notification provide Contractor written notice of either (1) its concurrence
with the results of the SPSR (including any waiver of its right to compel
correction of those non-conformances to the requirements of Exhibit B, Satellite
Performance Specification, specified by Purchaser in such notice), and the
Satellite shall be deemed ready for shipment to the Launch Site (the date of
such notice of concurrence, the “SPSR Complete Date”) or (2) its non-concurrence
with the results of the SPSR as provided in Article 9.1.7.

 

 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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9.1.7
In the event that such SPSR discloses (i) any failure to conduct testing in
accordance with the applicable sections of Exhibit D, Satellite Test Plan, or
(ii) any non-conformance of such Satellite to the requirements of Exhibit B,
Satellite Performance Specification, and such failure or non-conformance has not
been resolved by waivers or deviations approved by Purchaser pursuant to Article
9.1.4, a written notification of non-conformance to Contractor shall state each
such non-conformance required to be corrected or repaired (with reference to the
relevant provision of Exhibit D, Satellite Program Test Plan, or Exhibit B,
Satellite Performance Specification, deemed not met).

 

 
9.1.8
In the event that Purchaser provides Contractor with a notice of
non-conformance, Contractor shall correct or repair each such Purchaser notified
non-conformance promptly and thereafter conduct additional testing and/or a
“delta” SPSR, in accordance with the provisions of this Article 9, to the extent
necessary to demonstrate that the Satellite has been tested in accordance with
Exhibit D, Satellite Test Plan, or conforms to the requirements of Exhibit B,
Satellite Performance Specification, after which Contractor shall provide a
written notification to Purchaser of completion of the supplemental SPSR.
Purchaser shall within [***] from receipt of such notification, provide
Contractor with written notice of either (1) its concurrence with the results of
the supplemental SPSR (including any waiver of its right to compel correction of
those non-conformances to the requirements of Exhibit B, Satellite Performance
Specification, specified by Purchaser in such notice), and the Satellite shall
be deemed ready for shipment to the Launch Site or (2) its non-concurrence with
the results of the supplemental SPSR and Contractor shall be required to repeat
the process described in this  Article 9.1.7 until Purchaser provides Contractor
with a written notice of its concurrence pursuant to the requirements of this
Article 9.
 
If Purchaser fails to provide written notification required above within the
time specified above, and Contractor has provided written notice advising
Purchaser of such (a “Cure Letter”), the SPSR shall be deemed to have been
successfully completed if Purchaser has still not submitted a written notice

 
Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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within [***] of Purchaser’s receipt of the Cure Letter and the Satellite shall
be deemed ready for shipment to the Launch Site.
 
Upon receipt of Purchaser’s notification in accordance with this Article 9,
Contractor shall thereafter transport such Satellite in accordance with
Contractor’s standard commercial practices to the Launch Site (and the Satellite
shall be deemed Delivered upon successful completion of visual inspection by
Contractor following arrival at the Launch Site and removal from the shipping
container, or upon placement into storage pursuant to Article 35, as
applicable), and Contractor shall proceed or continue in the performance of the
Launch Support Services.  Contractor shall not ship the Satellite to the Launch
Site until all non-conformances are corrected, repaired or have a
Purchaser-approved waiver or deviation. Purchaser shall have no obligation to
authorize shipment of the Satellite to the Launch Site prior to the SPSR
Complete Date.

 
 
9.1.9
Inspection Costs Borne by Purchaser.  All costs and expenses incurred by
Purchaser and its Purchaser Associates in the exercise of inspection rights
under this Article 9, including travel and living expenses, shall be borne (or
arranged for) solely by Purchaser.

 
 
9.1.10
Correction of Deficiencies after SPSR.  If at any time following SPSR Complete
Date of the Satellite and prior to Intentional Ignition (or in the event of a
Terminated Ignition, prior to any subsequent Intentional Ignition), it is
discovered that the Satellite has a Defect or fails to meet the requirements
ofExhibit B, Satellite Performance Specification, as they may be modified as of
such time pursuant to Article 9.1.4, Contractor shall, at Contractor’s sole
expense, promptly correct such deficiencies prior to Intentional Ignition (or in
the case of a Terminated Ignition, prior to any subsequent Intentional Ignition)
in accordance with the applicable terms of this Contract.   Contractor shall use
reasonable efforts to avoid and minimize delays associated with any such Defects
as further described in Article 3.4.  In addition, in the event of a Terminated
Ignition, Contractor and Purchaser shall proceed in accordance with Article 12.1
for those actions necessary to prepare the Satellite for relaunch.

 

 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 10 - ACCEPTANCE OF SATELLITE, LAUNCH SUPPORT AND MISSION SUPPORT
SERVICES AND IN-ORBIT TEST
 
 
10.1
Satellite Acceptance

 
Acceptance of the Satellite by Purchaser shall occur finally and irrevocably for
all purposes hereunder upon the earlier to occur of: (i) the IOT Complete Date
(as defined in Article 10.3. below); or (ii) the instant immediately prior to an
event on or after Intentional Ignition resulting in the Total Loss of the
Satellite (or the Satellite being reasonably determined to be a Total Loss in
the event there is no insurance coverage for a constructive total loss).
 
 
10.2
Launch Support and Mission Support Services

 
Upon arrival of each Satellite at the Launch Site, Contractor shall proceed with
the provision of Launch Support Services in accordance with Exhibit A, Statement
of Work.  After Launch of each Satellite by the Launch Agency, Contractor shall
proceed with the provision of Mission Support Services in accordance with
Exhibit A, Statement of Work.
 
 
10.3
In-Orbit Testing (IOT)

 
Thirty (30) days prior to the scheduled Launch of the Satellite, Contractor
shall notify Purchaser in writing of the IOT schedule with respect to such
Satellite.  Purchaser (including but not limited to Purchaser Associates) may,
at Purchaser’s election and subject to Article 7 and Article 8.4, observe such
IOT at either Purchaser’s or Contractor’s facilities.
 
Contractor shall perform IOT in accordance with Exhibit D, Satellite Test Plan,
and conduct an IOT review (“IOTR”) within three (3) Business Days of completing
IOT (with a summary IOT report being submitted at least 24 hours prior to
conducting the IOT review), both in accordance with the applicable provisions of
Exhibit A, Statement of Work, and Exhibit D, Satellite Test Plan.  The purpose
of the IOTR is to confirm that: (i) the test program has been completed per
Exhibit D, Test Plan, and (ii) that the IOT results are properly documented
(items (i) and (ii) being the "Purpose of IOTR").  Upon written confirmation by
Purchaser that the Purpose of IOTR has been met, such confirmation, not to be
unreasonably withheld or delayed, the IOTR shall be complete (the date of such
written confirmation, the "IOT Complete Date") and handover shall occur.
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 11 - ACCEPTANCE INSPECTION FOR DELIVERABLE ITEMS OTHER THAN THE
SATELLITE
 
 
11.1
SCF Baseband TC&R Equipment and Satellite Unique Ground Products

 
With respect to the SCF Baseband TC&R Equipment and Satellite Unique Ground
Products, Contractor shall perform an inspection and test, including
over-the-air testing on the Satellite, of the SCF Baseband TC&R Equipment and
Satellite Unique Ground Products in accordance with Exhibit A, Statement of
Work, in coordination with Purchaser or Purchaser’s representative.  If the
tests establish that the SCF Baseband TC&R Equipment and Satellite Unique Ground
Products meet the requirements of Exhibit A, Statement of Work, and the
applicable sections of Exhibit B, Satellite Performance Specification,
Contractor shall deliver the test results and provide a certification to
Purchaser that the SCF Baseband TC&R Equipment and Satellite Unique Ground
Products meet the requirements of this Contract. Based upon Contractor’s
certification and the inspection and test results, and the results of any
additional inspection or testing that Purchaser may reasonably conduct in
coordination with Contractor, Purchaser shall, within [***] Business Days of
receipt of Contractor’s certification, either Accept the same in writing
(“Acceptance” with respect to the item) or notify Contractor in writing of any
Defects in the SCF Baseband TC&R Equipment and Satellite Unique Ground Products.
Should Purchaser fail to notify Contractor in writing of Defects in the SCF
Baseband TC&R Equipment and Satellite Unique Ground Products within [***]
Business Days of certification, the SCF Baseband TC&R Equipment and Satellite
Unique Ground Products shall be deemed Accepted by Purchaser.
 
If Purchaser’s notice identifies any Defects, promptly upon receipt of such
notice that the SCF Baseband TC&R Equipment and Satellite Unique Ground Products
contains a Defect, which notice shall state the particulars relating to such
Defect, Contractor shall remedy the Defect, conduct additional testing as
appropriate, and schedule another test of the SCF Baseband TC&R Equipment and
Satellite Unique Ground Products, as appropriate, in the presence of Purchaser
and/or Purchaser Associates authorized by Purchaser. When such Defect(s) have
been remedied to conform to all applicable requirements of Exhibit A, Statement
of Work, and Exhibit B, Satellite Performance Specification, Contractor shall
deliver the results of such additional testing required to
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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remedy the Defect(s) and provide certification to Purchaser that the SCF
Baseband TC&R Equipment and Satellite Unique Ground Products conform to all
applicable requirements of Exhibit A, Statement of Work, and Exhibit B,
Satellite Performance Specification, and the provisions of this Article 11.1
shall again apply until Acceptance of the SCF Baseband TC&R Equipment and
Satellite Unique Ground Products by Purchaser in accordance with this Article
11.1. [***] expeditiously complete the tasks necessary to facilitate Acceptance
of the SCF Baseband TC&R Equipment and Satellite Unique Ground Products, [***].
 
 
11.2
Deliverable Data, the Satellite Recommended Operating Procedures, the Satellite
Systems Engineering Database (SSED), and the Launch Support Products

 
For any Deliverable Data (including Deliverable Items of software but excluding
software integrated into the SCF Baseband TC&R Equipment, Satellite Unique
Ground Products and Satellite, which are subject to Article 11.1 and Article
10.1, respectively), the Satellite Recommended Operating Procedures, the
Satellite Systems Engineering Database (SSED) and Launch Support Products, that
require Purchaser approval pursuant to Exhibit A, Statement of Work, Purchaser
shall, within [***] Business Days of Delivery, notify Contractor in writing that
such Deliverable Data, the Satellite Recommended Operating Procedures, the
Satellite Systems Engineering Database (SSED) and/or Launch Support Products,
has either been: (i) accepted (irrevocable “Acceptance” with respect to each
such item of Deliverable Data, the Satellite Recommended Operating Procedures,
the Launch Support Products and/or the Satellite Systems Engineering Database
(SSED)), or (ii) that such Deliverable Data, the Satellite Recommended Operating
Procedures, Launch Support Products and/or the Satellite Systems Engineering
Database (SSED) do not comply with the requirements of Exhibit A, Statement of
Work, identifying each such non-conformance (with reference to the applicable
requirement of Exhibit A, Statement of Work deemed not met).  If Purchaser
notifies Contractor of any non-conformance pursuant to the foregoing, Contractor
shall promptly correct any non-compliant aspect of such Deliverable Data, the
Satellite Recommended Operating Procedures, Launch

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Support Products and/or the Satellite Systems Engineering Database (SSED)
identified in such notice from Purchaser, and re-submit the Deliverable Data,
the Satellite Recommended Operating Procedures, Launch Support Products and/or
the Satellite Systems Engineering Database (SSED) to Purchaser for a subsequent
inspection to verify that Contractor has corrected the previously-identified
non-compliance.  If Purchaser fails to provide notice within the time specified
above, Acceptance shall be deemed to have irrevocably occurred with respect to
such Deliverable Data, the Satellite Recommended Operating Procedures, Launch
Support Products and/or the Satellite Systems Engineering Database (SSED).  For
Deliverable Data, the Satellite Recommended Operating Procedures, Launch Support
Products and/or the Satellite Systems Engineering Database (SSED) that does not
require Purchaser approval pursuant to Exhibit A, Statement of Work, Acceptance
of such Deliverable Data, the Satellite Recommended Operating Procedures, Launch
Support Products and/or the Satellite Systems Engineering Database (SSED) shall
be deemed to have irrevocably occurred upon Delivery, [***].
 
 
11.3
Training

 
Acceptance of Training, or any part thereof, required by Exhibit A, Statement of
Work shall occur in accordance with this Article 11.3.  Training, or any part
thereof, furnished to Purchaser and/or Purchaser Associates shall be accompanied
by written notice from Contractor specifying that portion of the Training being
furnished.  Acceptance of Training, or any part thereof, shall be deemed to
irrevocably occur [***] Business Days after completion of such Training or part
thereof and delivery by Contractor of a certification of completion unless
within such time Purchaser provides a written notice to Contractor that the
Training, or part thereof, does not meet Purchaser’s reasonable satisfaction
with reference to the requirements of Exhibit A, Statement of Work, identifying
each such non-conformance.  In the event that Purchaser does not accept the
Training, or any part thereof, as set forth in this Paragraph, Contractor shall
promptly repeat the Training, or relevant part thereof.
 
 
11.4
Deliverable Services

 
Acceptance of Deliverable Services, or any part thereof, shall occur in
accordance with this Article 11.4. To the extent feasible, Deliverable Services
furnished to Purchaser shall be accompanied by written notice from Contractor
specifying that portion of the Deliverable Services being furnished. Acceptance
of Deliverable
 
 
Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Services, or any part thereof, shall be deemed to occur: (a) in a case where
re-performance of the Deliverable Services is not practical (for example, Launch
Support Services are performed real-time), upon completion of such Deliverable
Services or part thereof; or [***].
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Purchaser’s Inspection Agents
 
Purchaser may, upon giving prior written notice to Contractor, cause any
consultant(s) or agent(s) designated by Purchaser to observe or conduct the
acceptance inspection pursuant to this Article 11 in whole or in part; provided,
however, that the provisions of Article 7 and Article 8.4 shall apply to any
such consultant or agent and such consultant or agent shall comply with
Contractor’s normal and customary safety and security regulations provided to
Purchaser in writing in advance of such inspection.
 
 
11.5
Waivers and Deviations

 
Waivers of or deviations from the Performance Specification applicable to any
Deliverable Item subject to acceptance inspection pursuant to this Article 11
shall be addressed as set forth in Article 9.1.4.
 
 
11.6
Inspection Costs Borne by Purchaser

 
All costs and expenses incurred by Purchaser or its consultants or agents in the
performance of its inspection rights under this Article 11, including travel and
living expenses, shall be borne solely by Purchaser.
 
 
11.7
Warranty Obligations

 
In no event shall Contractor be released from any of its warranty obligations
applicable to any Deliverable Item as a result of such Deliverable Item having
been accepted as set forth in this Article 11.
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 12 - TRANSFER OF TITLE AND RISK OF LOSS
 
 
12.1
Satellite

 
 
12.1.1(A)
[***].  [***], title to and risk of loss or damage for the Satellite shall pass
from Contractor to Purchaser at the time of Intentional Ignition of the Launch
Vehicle used for the Launch of such Satellite.  In the event of a Terminated
Ignition not resulting in Total Loss, title to and risk of loss or damage for
such Satellite shall revert to Contractor upon such Terminated Ignition.  If
Contractor re-acquires title and risk of loss or damage as set forth in the
immediately preceding sentence, title to and risk of loss or damage for the
Satellite shall again pass to Purchaser upon the subsequent Intentional Ignition
of the Launch Vehicle used for Launch of such Satellite.  Prior to Intentional
Ignition, the Parties shall agree to appropriate revisions to certain
definitions (i.e., Intentional Ignition, Launch, Terminated Ignition, and other
related provisions) as required to ensure that risk of loss transfers from
Contractor to Purchaser in a manner that does not result in a lack (or gap in
time) of insurance coverage for the Satellite at any time between the time
period covered by the Ground Insurance to be provided by Contractor pursuant to
Article 32.5 and the attachment of risk for the Satellite under any Launch and
In-Orbit Insurance Policy.

 
[***].
 

 
12.1.1(B)
[***].

 
 
12.1.2
In the event of a Terminated Ignition, once the launch pad has been declared
safe and the Launch Agency authorizes the start of the demating operations,
Contractor shall, at Purchaser’s request, immediately take all necessary actions
to prepare the Satellite for a relaunch, including: (a) supporting the Launch
Agency in demating the Satellite from the Launch Vehicle and conducting
defueling operations; (b) directly performing inspection and testing,
refurbishment, storage, repair and replacement of damaged Component(s) (damaged
as a result of the Intentional Ignition, Terminated Ignition or associated
activities), and transportation of the Satellite to and from the Launch Site;
and (c) providing additional Launch support services for

 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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the subsequent Launch of the Satellite.  Such actions shall be handled as a
change pursuant to Article 16.1, and for the avoidance of doubt are not
considered to be performance of Work pursuant to the terms of the warranty set
forth in Article 15.2.1. Promptly after a Terminated Ignition, the Parties shall
establish a new due date for the repaired/refurbished Satellite. In the event of
a Terminated Ignition that results in the Total Loss of the Satellite, title to
and risk of loss or damage for the Satellite shall remain with Purchaser.

 
EXCEPT WITH RESPECT TO [***], UPON AND AFTER INTENTIONAL IGNITION OF THE LAUNCH
VEHICLE FOR THE SATELLITE, UNLESS AND TO THE EXTENT OF A TERMINATED IGNITION
WHERE CONTRACTOR RE-ACQUIRES TITLE TO AND RISK OF LOSS OR DAMAGE FOR THE
SATELLITE AS PROVIDED IN ARTICLE 12.1, CONTRACTOR’S SOLE OBLIGATION, LIABILITY
OR FINANCIAL RISK, AND THE SOLE AND EXCLUSIVE REMEDIES OF PURCHASER OR ANY PARTY
ASSOCIATED WITH PURCHASER, WITH RESPECT TO THE SATELLITE’S DESIGN, WORKMANSHIP,
CONFORMITY TO SPECIFICATION, USE OR PERFORMANCE OF SUCH SATELLITE, INCLUDING ANY
ASSISTANCE OR ADVICE (ACTUAL OR ATTEMPTED) PROVIDED OR OMITTED AS CONTEMPLATED
BY [***] HEREOF (INCLUDING WITH RESPECT TO ANY ACTUAL OR CLAIMED DEFECT CAUSED
OR ALLEGED TO BE CAUSED AT ANY TIME WHETHER BEFORE OR AFTER INTENTIONAL
IGNITION, BY CONTRACTOR’S OR ANY OF ITS SUBCONTRACTORS’ NEGLIGENCE) SHALL BE AS
SET FORTH IN [***], IN ALL CASES SUBJECT TO THE LIMITATION OF LIABILITY SET
FORTH IN ARTICLE 27.  THE FOREGOING SHALL NOT PREJUDICE OR LIMIT EITHER PARTY’S
RIGHTS AND REMEDIES WITH RESPECT TO ARTICLE 28, DISCLOSURE AND HANDLING OF
PROPRIETARY INFORMATION, AND ARTICLE 39, INTELLECTUAL PROPERTY.
 
 
12.2
Deliverable Items Other Than the Satellite

 
Title to and risk of loss or damage for the SCF Baseband TC&R Equipment and the
Satellite Unique Ground Products shall pass from Contractor to Purchaser upon
Acceptance thereof pursuant to Article 11.1. Purchaser’s ([***]) rights in and
to Deliverable Data (including, without exception, Deliverable Items of software
and software integrated into hardware), the Satellite Recommended Operating
Procedures,
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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the Launch Support Products and the Satellite Systems Engineering Database
(SSED) are as set forth in Article 39.
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 13 -  ORBITAL PERFORMANCE INCENTIVES
 
 
13.1
General

    
 
13.1.1
Contractor may earn, and Purchaser shall pay, if and to the extent earned, the
Orbital Performance Incentives for the Satellite over the Orbital Performance
Incentive Period in accordance with this Article 13.  As used herein, “Orbital
Performance Incentives” means an amount not to exceed [***], which may be earned
by Contractor based on in-orbit performance of the Satellite as set forth in
this Article 13.  For the purpose of calculating the Orbital Performance
Incentives earned by Contractor, the first day of the applicable Orbital
Performance Incentive Period shall commence at 12:01 a.m. Greenwich Mean Time on
the first day following the IOT Complete Date, [***].  All measurements,
computations and analyses made pursuant to this Article 13 shall be made in
accordance with good engineering practice applying standards generally
applicable in the satellite industry.

 
 
13.1.2
[***].

 
 
13.2
Daily Rate of Orbital Performance Incentives

 
Subject to Articles 13.1.2 and 13.5, Contractor shall earn Orbital Performance
Incentives over the Orbital Performance Incentive Period at a daily rate
calculated by dividing the total amount of Orbital Performance Incentives by
[***] (the “Daily Rate”) for each day that there is no Transponder Failure.
 
[***].

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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13.3
[***]

 
[***].
 
 
13.4
Orbital Storage

 
If Purchaser places the Satellite in Orbital Storage (other than due to the
inability to operate the Satellite for causes not Attributable to Purchaser, or
due to the failure of the SCF Baseband TC&R Equipment and Satellite Unique
Ground Products to be Delivered by Contractor and Accepted by Purchaser),
Contractor shall continue to earn Orbital Performance Incentives at the Daily
Rate.
 
 
13.5
Failed Transponder(s)

 
Contractor shall forfeit the Daily Rate Per Transponder  for any Transponder on
any day that such Transponder on the Satellite experiences a Transponder Failure
during the Orbital Performance Incentive Period.  [***].
 
 
13.6
Total Loss or Partial Loss not Attributable to Purchaser or the Launch Agency

 
In the event that the Satellite is a Total Loss on or before the end of Orbital
Performance Incentive Period, and such Total Loss is not Attributable to
Purchaser, Contractor shall not be entitled to earn any further Orbital
Performance Incentives on or after the date of such loss and shall have no
further claim against Purchaser regarding such Orbital Performance
Incentives.  Contractor shall not lose (nor have any obligation to refund,
except to the extent required in accordance with the provisions of Article
13.10.2, as applicable, in the event that Purchaser exercises its option to
pre-pay Orbital Performance Incentives) any Orbital Performance Incentives
earned prior to the time that the Satellite becomes a Total Loss as provided
above.
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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13.7
[***]

 
[***]
 
 
13.8
Purchaser Operation of the Satellite

 
If the Satellite operates in a manner that is not in accordance with any
requirements of Exhibit B, Satellite Performance Specification, and to the
extent such operation is due to any act or omission on the part of Purchaser or
Purchaser’s representatives, consultants or subcontractors (for avoidance of
doubt, causes solely attributable to the Launch Agency shall be considered
causes attributable to Purchaser) in the operation of, testing of, or
communication with, the Satellite (unless such act or omission was performed in
accordance with directions or instructions provided by Contractor) (the extent
of such degraded performance to be considered “Attributable to Purchaser”),
Contractor shall continue to earn Orbital Performance Incentives with respect to
such Satellite at the rate that applied prior to the act or omission resulting
in degraded performance (subject to later adjustments for any losses of Future
Orbital Performance Incentives in accordance with the operation of this Article
13).
 
 
13.9
Contractor Access

 
During the Orbital Performance Incentive Period, Contractor shall have
reasonable access to applicable performance data of the Satellite for purposes
of evaluating any degradation in the performance of the Satellite.
 
 
13.10
Payment

 
 
13.10.1
Provided that Purchaser has not exercised the option to pre-pay the Orbital
Performance Incentives in advance as provided in Article 13.10.2 (in which case
the provisions of this Article 13.10.1 shall no longer apply), and subject to
Article 13.12, if applicable, payments of amounts earned under this Article 13
plus interest thereon calculated from the first day of the Orbital Performance
Period until the date of payment at an annual interest rate of [***] percent
([***]%), compounded [***], shall be paid in [***] increments as follows: (a)
the first payment shall be due no later than thirty (30) days following the end
of [***] following the start of the Orbital Performance Incentive Period, and
shall cover the first [***] of earned Orbital Performance Incentives, if any;
and (b) thereafter, through the end of the Orbital

 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Performance Incentive Period (or such earlier date as the obligation to pay
Orbital Performance Incentives shall cease in accordance with the terms of this
Contract), all subsequent payments shall be due no later than thirty (30) days
following the end of each subsequent [***] for the prior [***] earned Orbital
Performance Incentives.  In the event the first [***] Orbital Performance
Incentive period (Period 1) is a partial period, an additional partial period
([***]) shall be added to ensure that the Orbital Performance Incentive Period
contains a full one hundred and eighty (180) months.

 
 
13.10.2
Purchaser Option for Performance Payback of Orbital Performance
Incentives.  Purchaser shall have the option, exercisable by written notice to
Contractor at any time during the Orbital Performance Incentive Period to
pre-pay in a lump sum payment all Future Orbital Performance Incentives that
remain available to be earned (for avoidance of doubt, any amount of
future Orbital Performance Incentives that can no longer be earned due to
failures on the Satellite, e.g., permanent Transponder Failures, shall not be
included in determining the lump sum pre-payment amount), including interest
thereon, at a rate of [***] percent ([***]%), compounded [***] from the IOT
Complete Date until the date of payment (such lump sum payment, the "Prepaid
Amount", and the date of such payment the "Prepayment Date"). Thereafter,
Contractor shall be obligated to refund to Purchaser the portion of the Prepaid
Amount, if any, attributable to Orbital Performance Incentives that would not
have been payable (i.e., not earned) pursuant to the provisions of this Article
13 other than this Article 13.10. 

 
 
A.
Orbital Performance Incentive Payback.  Purchaser may invoice Contractor no more
frequently than once per [***] for Prepaid Amounts of Orbital Performance
Incentives that are not subsequently earned during the invoice period.  In the
event of a permanent Transponder Failure, Purchaser shall be entitled to invoice
Contractor immediately for the entire portion of the Prepaid Amount relating to
such failed Transponder.  Contractor shall make Orbital Performance Incentive
payback payments within thirty (30) days after receipt of Purchaser’s invoice
for such Orbital Performance Incentive payback amounts, plus interest thereon
calculated

 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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from the IOT Complete Date until the date of Orbital Performance Incentive
payback payment at an annual interest rate of [***] percent ([***]%), compounded
[***].

 
If the Satellite becomes a Total Loss after the Prepayment Date and before the
end of the Orbital Performance Incentive Period, Contractor shall refund to
Purchaser, within 30 days of invoice from Purchaser, the balance of all Prepaid
Amounts of unearned Orbital Performance Incentives plus interest thereon
calculated from the IOT Complete Date until the date of payment at an annual
interest rate of [***] percent ([***]%), compounded [***].
 
 
13.11
Complete Loss of Unearned Incentives

 
Contractor shall no longer be entitled to earn any remaining unearned Orbital
Performance Incentives if: (a) Purchaser permanently withdraws the Satellite
from operational service or is unable to operate the Satellite for the purpose
of operating a broadband internet subscriber service, prior to the end of the
Satellite Stated Life, due to performance problems [***]; or (b) pointing errors
exceed the values set forth in Exhibit B, Satellite Performance Specification by
more than [***] percent ([***]%) and Contractor is unable to fix such errors
using reasonable efforts.
 
 
13.12
Ground Storage

  
If after Satellite Pre-Shipment Review, Purchaser places the Satellite in Ground
Storage for reasons Attributable to Purchaser ([***]), Contractor will earn
Orbital Performance Incentives and Purchaser will pay Orbital Performance
Incentives in accordance with Article 35.3, together with interest thereon at
the annual rate of [***]%, compounded [***] beginning on the first date that
Orbital Performance Incentives are due pursuant to operation of Article 35.3
(such date being the “Incentive Start Date”) and ending on the date of
payment.  Any amounts paid pursuant to this Article 13.12 (the “Storage
Incentives”) shall be applied by Contractor, including the interest payments, in
satisfaction of the first Orbital Performance Incentives earned by Contractor
following Launch, in accordance with this Article 13, until such Storage
Incentives shall have been fully applied.  Thereafter Contractor shall continue
to earn Orbital Performance Incentives as provided in this Article 13, except
that interest calculated on the amount of
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Orbital Performance Incentives earned during any quarterly period shall include
interest thereon calculated at the annual rate of [***]% compounded [***],
beginning on the Incentive Start Date and ending on the date of payment. To the
extent that, due to the occurrence of a Total Loss of the Satellite after
Launch, Contractor is not entitled to earn any or all of the Storage Incentives,
Contractor shall refund the unearnable amount of Storage Incentives to Purchaser
together with interest thereon at the annual rate of [***]%, compounded [***]
beginning on the Incentive Start Date and ending on the date of payment.
 
 
13.13
[***]

        
[***].
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 14 - CORRECTIVE MEASURES IN THE SATELLITE AND OTHER DELIVERABLE ITEMS
 
 
 
 
14.1
If the data available from any satellite manufactured by Contractor (whether
in-orbit or on the ground) or other information known to Contractor shows that
the unlaunched Satellite to be delivered under this Contract contains or may
contain a Defect, Contractor shall provide Purchaser prompt written notice
thereof, together with such supporting detail as is known to Contractor and not
prohibited by Contractor’s obligations of confidentiality to any third
party.  For the avoidance of doubt, the restriction on providing information
that is confidential to any third party does not relieve Contractor of its
obligation to provide Purchaser notice of a Defect or potential Defect as
contemplated under this Article 14.  [***].

 
 
14.2
At Contractor’s sole cost, Contractor shall promptly correct any such Defect or
potential Defect notwithstanding that a payment may have been made in respect
thereof, and regardless of prior reviews, inspections, acceptances or
approvals.  Contractor shall use reasonable efforts to avoid and minimize delays
as provided in Article 3.4.  If the data available from any satellite
manufactured by Contractor (whether in-orbit or on the ground) or other
information known to Contractor shows that the launched Satellite delivered
under this Contract contains or may contain a Defect or Satellite Anomaly,
Contractor shall promptly notify Purchaser in writing and proceed in accordance
with Article 15.3.

 
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 15 - REPRESENTATIONS AND WARRANTIES
 
 
15.1
Representations

 
Each Party represents that, as of the EDC:
 
1. It is a corporation or a limited liability company duly organized in the
State of Delaware.
 
 
2. It has all requisite corporate power and authority to own and operate its
material properties and assets and to carry on its business as now conducted in
all material respects.
 
 
3. It is duly qualified to transact business and is in good standing in each
jurisdiction in which the failure to so qualify would have a material adverse
effect on the other Party.
 
 
4. It has all requisite corporate power and authority to enter into this
Contract and to carry out the transactions contemplated by this Contract.
 
 
5. The execution, delivery and performance of this Contract and the consummation
of the transactions contemplated by this Contract have been duly authorized by
the requisite corporate action and do not conflict with any material agreement
or obligation to which it is a party or which binds its assets.
 
 
6. This Contract is a valid and binding obligation, enforceable against such
Party in accordance with its terms, except as enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium and other similar laws
relating to or affecting creditors’ rights generally or by general equitable
principles (regardless of whether such enforceability is considered in a
proceeding in equity or at law).
 
 
7. No suit, claim, action, arbitration, legal, administrative, or other
proceeding is pending, or to the best of each Party’s knowledge, threatened
against it that would likely affect the validity or enforceability of this
Contract, or the ability of each Party to fulfill its commitments hereunder in
any material respect.
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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15.2
Terms and Period of Warranty

 

 
15.2.1
Satellite.  Contractor warrants that from completion of SPSR up to Intentional
Ignition of the Launch Vehicle (unless and to the extent of a Terminated
Ignition where Contractor reacquires title and risk of loss or damage for the
Satellite as provided in Article 12.1(A), in whichcase the warranty obligation
will reattach but, as to any damaged Component, only after repair and
replacement of such damaged Component pursuant to Article 12.1(B) and the
warranty period shall continue through the subsequent Intentional Ignition), the
Satellite shall be free of any Defects and shall be manufactured and will
perform in conformity with applicable requirements of Exhibit B, Satellite
Performance Specification (as modified by any waiver and/or deviation pursuant
to Article 9.1.4). If the Satellite or any part thereof (including software
integrated into the Satellite) does not conform to the above warranty,
Contractor shall at any time during the applicable warranty period and
irrespective of prior inspections or approvals proceed in accordance with
Article 9.1.10 hereof.

 

 
15.2.2
SCF Baseband TC&R Equipment and Satellite Unique Ground Products.  Contractor
warrants that the SCF Baseband TC&R Equipment and Satellite Unique Ground
Products delivered under this Contract shall be manufactured in conformity with
the applicable requirements of Exhibit A, Statement of Work (as modified by any
waiver and/or deviation pursuant to Article 11.6) and shall be free from Defects
during the period commencing on the date of Acceptance of such SCF Baseband TC&R
Equipment and Satellite Unique Ground Products pursuant to Article 11 and ending
on the later of: [***].
 
During the period specified above, as Purchaser’s sole and exclusive remedy for
any non-conformance or Defect in such SCF Baseband TC&R Equipment and/or
Satellite Unique Ground Products of which Purchaser notifies to Contractor in
writing, such non-conformance or Defect shall be remedied by Contractor at
Contractor’s expense by repair or replacement of the defective or non-conforming
item (at Contractor’s election).  For any such non-conformance or Defect,
Contractor shall determine if repair or replacement is required to be performed
at Contractor’s plant. If required, Purchaser shall ship the relevant item of
SCF Baseband TC&R Equipment and/or Satellite Unique Ground

 
 
 
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Products to Contractor’s designated facility. Contractor shall be responsible
for the cost of shipment (including transportation, transit insurance, taxes
and/or duties), and the cost of return shipment (including transportation,
transit insurance, taxes and duties) to Purchaser at the location designated in
Article 3.1. Risk of loss or damage for the relevant item of SCF Baseband TC&R
Equipment and/or Satellite Unique Ground Products shall transfer to Contractor
upon delivery of the relevant item of SCF Baseband TC&R Equipment and/or
Satellite Unique Ground Products to the shipping carrier by Purchaser.  Risk of
loss or damage to the relevant item of SCF Baseband TC&R Equipment and/or
Satellite Unique Ground Products shall transfer again to Purchaser once such
item of SCF Baseband TC&R Equipment and/or Satellite Unique Ground Products is
repaired or replaced pursuant to this Article 15.2.2 and received by Purchaser
at the location designated therefor in Article 3.1. After the expiration of the
period specified above and through the Satellite Stated Life, a failure of the
software integrated into an item of SCF Baseband TC&R Equipment and/or Satellite
Unique Ground Products to meet the applicable requirements of Exhibit A,
Statement of Work, will, if such failure results in a Satellite Anomaly, be
resolved in accordance with the Satellite Anomaly process pursuant to Article
15.3, below.

 

 
15.2.3
Training, Mission Support Services and Launch Support Services.  Contractor
warrants that the Training, Mission Support Services and Launch Support Services
it provides to Purchaser pursuant to this Contract will, upon Acceptance,
conform to the highest professional standards for the commercial satellite
communications industry for work similar in type, scope, and complexity to the
Work at the time such Work is provided.  In the event Contractor breaches this
warranty and is so notified by Purchaser as to Training within [***] of
Acceptance, or for other services as soon as possible where time is of the
essence, as Purchaser’s sole and exclusive remedy under this Warranty,
Contractor shall correct the deficiencies in the provision of such Training,
Mission Support Services and Launch Support Services where it is possible to do
so (e.g., Contractor cannot correct deficiencies in, or re-perform, Launch
Support Services from and after Launch).

 
Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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15.2.4
Deliverable Data, the Satellite Recommended Operating Procedures, the Satellite
Systems Engineering Database (SSED), and/or Launch Support Products.  All
Deliverable Data, the Satellite Recommended Operating Procedures, the Satellite
Systems Engineering Database (SSED) and/or Launch Support Products shall be
complete, up-to-date and shall otherwise conform to the requirements of this
Contract.  In the event the Contractor breaches this warranty, as Purchaser’s
sole and exclusive remedy under this Warranty, Contractor shall correct the
deficiencies in the Deliverable Data, the Satellite Recommended Operating
Procedures, the Satellite Systems Engineering Database (SSED) and/or Launch
Support Products, and resubmit such Deliverable Data, the Satellite Recommended
Operating Procedures, the Satellite Systems Engineering Database (SSED), and/or
Launch Support Products to Purchaser.

 

 
15.2.5
Software. In addition to the warranties set forth in Articles 15.2.2, Contractor
further represents and warrants that, through the Satellite Stated Life,
Contractor shall: (i) demonstrate that all PC-based Software delivered hereunder
is free of viruses or similar items by testing such Software using commercially
reasonable anti-viral software; (ii) not introduce into any delivered Software,
without Purchaser’s prior written approval, any code that would have the effect
of disabling or otherwise shutting down all or any portion of the delivered
Software (except as to licensed third party software identified in CDRL 26
included in some delivered Software, such licensed software will prevent any
unlicensed copies of delivered Software from running); and (iii) not seek to
gain access to, or allow access by any third party to, the Work or the Satellite
through any special programming devices or methods, including trapdoors or
backdoors, to bypass, without Purchaser’s prior written approval.  Although the
Parties contemplate that all necessary software support will be provided
pursuant to Article 15.3, below, Contractor shall provide Purchaser the option
to purchase additional maintenance and support of the Software at commercially
reasonable terms and prices.

 
15.2.6
Title. Contractor represents and warrants that it shall provide good and
marketable title to all Deliverable Items for which title shall pass in
accordance

  
Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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with Article 12 free and clear of any liens and encumbrances of any kind (except
those, if any, incurred by Purchaser [***]), at the time title passes pursuant
to Article 12.

 

 
15.2.7
Disclaimer.  EXCEPT AND TO THE EXTENT EXPRESSLY PROVIDED IN THIS ARTICLE 15,
CONTRACTOR HAS NOT MADE NOR DOES IT HEREBY MAKE ANY REPRESENTATION OR WARRANTY,
WHETHER WRITTEN OR ORAL, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION, ANY
WARRANTY OF DESIGN, OPERATION, CONDITION, QUALITY, SUITABILITY OR
MERCHANTABILITY OR FITNESS FOR USE OR FOR A PARTICULAR PURPOSE, ABSENCE OF
LATENT OR OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE, WITH REGARD TO THE
SATELLITE, ANY OTHER DELIVERABLE ITEM OR ANY OTHER WORK.  CONTRACTOR MAKES NO
WARRANTY WITH RESPECT TO LAUNCH SERVICES OR THE CONDITION, USE OR PERFORMANCE OF
ANY LAUNCH VEHICLE.

 
 
15.3
Satellite Anomalies

 
Contractor shall investigate any Satellite Anomaly or Defect occurring on the
Satellite after launch during the in-orbit life of such Satellite and known to
it or as notified in writing by Purchaser, and shall use reasonable efforts to
correct such Satellite Anomaly or Defect as promptly as possible in accordance
with the Satellite Anomaly resolution support services set forth in Section 7 of
Exhibit A, Statement of Work.  Such reasonable efforts shall be conducted at
Contractor’s expense to resolve Defects or Satellite Anomalies by on-ground
means, including software patches or updates, or transmission by Contractor of
commands to the Satellite to eliminate or mitigate any adverse impact resulting
from any such Satellite Anomalies or Defects, to establish work-around
solutions, or to otherwise resolve such Defects or Satellite Anomalies.
Contractor shall coordinate and consult with Purchaser concerning such on-ground
resolution of Defects or Satellite Anomalies in the launched Satellite. If for
any reason any such Satellite Anomaly or Defect cannot be or is not corrected as
set forth above, and as a result thereof, such Satellite suffers any loss,
including loss of Transponders or becomes a Total Loss, Purchaser, including
Purchaser Associates, shall look solely to its/their  Launch and In-Orbit
Insurance Policy and any subsequent insurance policy for the Satellite procured
by Purchaser, to compensate it for its loss and any consequences
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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therefrom, and Contractor shall have no liability or obligation to Purchaser,
[***] or any other person in respect of such loss, except as set forth in
Article 13 and to provide the services set forth in Articles 32.2 and 32.4,
subject to the conditions and limitations of such Articles and subject to the
limitation of liability stated in Article 15.2.7 above.   In the event and to
the extent that the occurrence of a Satellite Anomaly is Attributable to
Purchaser, Purchaser shall pay Contractor the Actual Costs reasonably incurred
of all services approved by Purchaser and provided by Contractor associated with
such Satellite Anomaly services, plus a markup of [***] percent ([***]%) of such
costs, which costs and markup shall be invoiced and paid pursuant to the
provisions of Article 5.
 
15.4   Use Conditions Not Covered by Warranty
 
With respect to the SCF Baseband TC&R Equipment and the Satellite Unique Ground
Products (including Software integrated into the SCF Baseband TC&R Equipment and
the Satellite Unique Ground Products), the warranty under this Article 15 shall
not apply if adjustment, repair or parts replacement is required as a result,
directly or indirectly, of accident not attributable to Contractor, unusual
physical or electrical stress beyond the SCF Baseband TC&R Equipment and the
Satellite Unique Ground Products’ design tolerances, Purchaser or third party
negligence, misuse, failure of environmental control prescribed in operations
and maintenance manuals, repair or alterations by any party other than
Contractor without Contractor’s prior written consent, or by causes other than
normal and ordinary use.  The warranty provided pursuant to this Article 15 is
conditioned upon Contractor being given reasonable access, if required, to
Deliverable Items delivered at Purchaser’s facility or Purchaser-designated
facility in order to effect any repair or replacement thereof.  If the defect
repaired or remedied by Contractor is not covered by the warranty provided
pursuant to this Article 15, Purchaser shall pay Contractor the Actual Costs
reasonably incurred of such repair or replacement, plus a markup of [***]
percent ([***]%) of such costs, which costs and markup shall be invoiced and
paid pursuant to the provisions of Article 5.
 
15.5           Subcontractor Warranties
 
Contractor shall pass on or assign ([***]) to Purchaser all applicable
warranties on goods or services given by Subcontractors to the extent Contractor
is permitted by the terms of its purchase contracts with such suppliers or
manufacturers and further to the extent that
 
 
Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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such assignment does not interfere with Contractor’s performance of its
obligations hereunder.  [***].
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 16 - CHANGES
 
 
16.1
Change Orders

 
Purchaser may, at any time between the EDC and the completion of this Contract,
direct a change within the general scope of this Contract in drawings, designs,
specifications, method of shipment or packing, quantities of items to be
furnished, place of Delivery, postpone Delivery under a stop-work order (but not
more than in the cumulative, [***]), require additional Work, or direct the
omission of Work. In the event Purchaser directs a change, Contractor shall: (a)
immediately proceed with the Work as changed; and (b) within thirty (30)
Business Days of Purchaser’s direction, submit to Purchaser (a written proposal
of the effect of such a change on the Firm Fixed Price, specification, payment
plan or time required for performance and/or any other affected terms and
conditions (the “Proposal”).  Prior to directing such change, Purchaser may
issue a request to Contractor for a Proposal. Within thirty (30) days of receipt
of such request for the Proposal, Contractor shall provide Purchaser with the
Proposal.
 
Except as otherwise expressly provided in this Contract, if any change directed
by Purchaser causes an increase or decrease in the cost of, or the time required
for the performance of this Contract, and/or other terms and conditions, an
equitable adjustment shall be made in the Firm Fixed Price, Delivery schedule
and/or other affected terms and conditions, as applicable, and this Contract
shall be modified in writing accordingly.  Firm Fixed Price adjustments shall
account only for the estimated net impact on the Actual Costs incurred by
Contractor as a result of the change including a reasonable profit thereon not
to exceed [***] percent ([***]%). If requested by Purchaser, Contractor will
provide Purchaser reasonably detailed back-up data to support its claim for
equitable adjustment. If the cost of supplies or materials made obsolete or
excess as a result of a change is included in Contractor’s claim for adjustment,
Purchaser shall have the right to prescribe the manner of disposition of such
supplies or materials.  If Purchaser directs the omission of Work and, as a
result, provided Contractor shall have taken all reasonable steps to mitigate
such costs, it causes an increase in the cost of the remaining Work to be
performed hereunder, such increase in costs shall constitute an allowable
element of Contractor’s claim for equitable adjustment.  If Purchaser directs
the omission of Work and, as a result, it causes a decrease in the cost of the
remaining

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Work to be performed hereunder, such decrease in costs shall be refunded to
Purchaser or be credited to Purchaser against future amounts, at Purchaser's
election.
 
Upon receipt of Contractor’s Proposal, the Parties shall commence good faith
negotiations concerning the appropriate equitable adjustment to the Contract. In
the event that the Parties have not reached agreement on the amount and manner
of Contractor’s compensation within sixty (60) days of Purchaser’s direction for
change, Purchaser shall pay to Contractor (or become obligated to pay to
Contractor when due) the agreed-upon portions of the proposed changes to the
Firm Fixed Price and Exhibit E, Price and Payment Plan. The Parties shall exert
all good faith efforts to reach resolution regarding the disputed portions in
accordance with Article 25, Dispute Resolution.
 
[***].
 
16.2
Program Name Change

 
Purchaser shall be entitled to change the name of the Satellite at any time at
no additional cost and Contractor shall agree to amend promptly the Contract,
Exhibits, and other applicable data and documentation, including Deliverable
Data, to incorporate the new name of the Satellite and, if so requested by
Purchaser, eliminate any reference to the former name on a prospective basis.
 
 

Exhibit 10.1 Logos [logos.jpg]
 
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Article 17 - FORCE MAJEURE
 
 
17.1
Force Majeure Defined

 
Neither Party shall be responsible for nonperformance of its contractual
obligations (including, in the case of Contractor, late Delivery) due to Force
Majeure.  Force Majeure shall be any event beyond the reasonable control of the
affected Party or its suppliers and Subcontractors and shall include, but not be
limited to: (1) acts of God; (2) acts of a public enemy; (3) acts of a
government in its sovereign capacity (including any action or inaction affecting
the import or export of items); (4) war and warlike events; (5) catastrophic
weather conditions such as hurricanes, tornadoes and typhoons; (6) fire,
earthquakes, floods, epidemics, quarantine restrictions; or (7) sabotage, riot
and embargoes.  For an event to qualify for Force Majeure relief hereunder: (1)
the event must be beyond the control and without fault or negligence of a Party
or its subcontractors hereunder; (2) the resulting delay cannot be circumvented
by reasonable efforts to establish work-around plans, payment of expedited fees,
alternate sources, or other means; and (3) the affected Party must provide the
other Party with written notice thereof as soon as possible but in no event
later [***] after the occurrence of such an event. Notwithstanding anything to
the contrary in the foregoing, any failure by a Subcontractor to meet its
obligations to Contractor, or any delay due to labor shortages, defective
tooling, transportation difficulties, equipment failure or breakdowns, lockouts,
or inability to obtain materials shall not constitute a Force Majeure event
(except where such circumstance is itself caused by a Force Majeure event), and
shall not relieve Contractor from meeting any of its obligations under this
Contract. The Parties shall use reasonable efforts to minimize the effect of any
Force Majeure event. In the event a Party claims a Force Majeure event, such
Party's written notice called for above shall include a detailed description of
the portion of the Work (or other obligations) known to be affected by such
delay, [***]. In the event of a Force Majeure event, the Delivery requirement
shall be extended for such period as is supported by the evidence provided;
provided, however, the occurrence of a Force Majeure event shall in no event
entitle Contractor to an increase in the price for the Work. Any adjustment of
time appropriate under this Article shall be formalized promptly by the
execution of a mutually acceptable amendment to this Contract.
 
 
17.2
Termination for Force Majeure

 
[***].
 

Exhibit 10.1 Logos [logos.jpg]
 
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restriction on the title page.
 
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Article 18 - PURCHASER DELAY OF WORK
 
If the performance of all or any part of the Work required of Contractor under
this Contract is delayed or interrupted primarily caused by Purchaser’s failure
to perform its contractual obligations set forth in Table 8-1 of Exhibit A,
Statement of Work, and not due to Force Majeure, within the time specified in
this Contract or within a reasonable time if no time is specified, or by an act
or failure to act of Purchaser or its agents, consultants or subcontractors
(including, without limitation, the Launch Agency) that unreasonably interferes
with and/or materially delays Contractor’s performance of its obligations under
this Contract (each a “Purchaser Delay”), Purchaser shall be responsible for any
additional Actual Costs incurred by Contractor [***], and the Firm Fixed Price
shall be modified accordingly [***], provided that if the delay or interruption
is due to the unavailability of any of the items identified in Table 8.1 of
Exhibit A, Statement of Work, Purchaser shall direct Contractor to place the
Satellite in storage in accordance with the applicable provision(s) of this
Contract.  In addition, Contractor shall be entitled to an equitable adjustment
in performance requirements, Delivery schedules, and any other terms of this
Contract to the extent affected by such Purchaser Delay.  The Parties will
formalize all such adjustments by executing an appropriate amendment to this
Contract.  To qualify as a Purchaser Delay hereunder, (a) Contractor must
provide Purchaser written notice of any applicable Purchaser Delay no later than
[***] Business Days after the time of such Purchaser Delay; and (b) Contractor
must use reasonable efforts to avoid and/or mitigate the effect of such
Purchaser Delay.
 
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 19 - INTELLECTUAL PROPERTY INDEMNITY
 
 
19.1
Indemnification

 
Contractor, at its own expense, hereby agrees to defend or, at Contractor’s sole
option, to settle, and to indemnify and hold harmless Purchaser and its
respective shareholders, officers, directors and employees, [***] and their
respective shareholders, officers, directors and employees (collectively with
Purchaser referred to as the “Indemnified Companies”), from and against any
third party claim or suit based on an allegation that the manufacture of any
Deliverable Item or any part thereof or the normal intended use, lease or sale
of any Deliverable Item or any part thereof infringes any third party‘s
Intellectual Property Right (“Intellectual Property Claim”), and shall pay any
royalties and other liabilities adjudicated (or provided in settlement of the
matter) to be owing to the third party claimant as well as costs and expenses
incurred in defending or settling such Intellectual Property
Claim.  Contractor’s obligations under this Article 19.1 shall be subject to the
Conditions to Indemnification set forth in Article 20.3, provided that in the
case of an Intellectual Property Claim against an Indemnified Company by a third
party, Purchaser shall promptly give notice in writing thereof and permit
Contractor to answer the allegations and defend the actions or proceedings and
also give to Contractor at Contractor's cost, all reasonable information,
assistance and authority required for the above purposes.  No failure or delay
of Purchaser to provide such notice shall relieve Contractor of any obligation
under this Article 19, unless such failure prejudices Contractor’s ability to
defend or settle such claim.
 
 
19.2
Infringing Equipment

 
If Contractor’s performance of the Work or the manufacture of any Deliverable
Item or any part thereof or the normal intended use, lease or sale or other
disposition of any Deliverable Item or any part thereof under this Contract is
enjoined as a result of an Intellectual Property Claim or is otherwise
prohibited, Contractor shall, at its option and expense (i) resolve the matter
so that the injunction or prohibition no longer pertains, (ii) procure for the
Indemnified Companies the right to use the infringing item, and/or (iii) modify
the infringing item so that it becomes non-infringing while remaining in
compliance with Exhibit B, Performance Specification (as such may be modified or
waived pursuant to Article 9.4 or Article 11.6, as applicable).  Purchaser shall
reasonably cooperate with Contractor to mitigate or remove any infringement.  If
Contractor is
 

Exhibit 10.1 Logos [logos.jpg]
 
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restriction on the title page.
 
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unable to accomplish (i), (ii) or (iii) as stated above, Purchaser shall have
the right to terminate this Contract, in whole or in part, with respect to such
Deliverable Item, return such Deliverable Item(s) to Contractor (in space, with
respect to an in-orbit Satellite), and receive a refund of the amounts paid by
Purchaser hereunder for such terminated Deliverable Item(s) less a reasonable
allowance for depreciation.
 
 
19.3
Combinations and Modifications

 
Contractor shall have no liability under this Article 19 for any Intellectual
Property Claim arising from (i) use of any Deliverable Item in combination with
other items not provided, recommended, or approved by Contractor (except for
combinations within the scope of the intended use of the Deliverable Items known
to Contractor), where the infringement claim would not have arisen but for such
combined use, or (ii) modifications of any Deliverable Item after Delivery by a
person or entity other than Contractor unless authorized by written directive or
instructions furnished by Contractor to Purchaser under this Contract.
 
 
19.4
Sole Remedies

 
For purposes of this Article 19, the term “third parties” shall not be
interpreted as including any of the Indemnified Companies ([***]), and Purchaser
shall be the only party entitled to enforce this Article on behalf of itself and
any of the Indemnified Companies. The Parties agree that none of the Indemnified
Companies shall be considered as third party beneficiaries entitled to enforce
this Article directly against Contractor. The remedies set forth in this Article
19 are the sole and exclusive remedies for, or related to, any Intellectual
Property Claim.
 
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 20 - INDEMNIFICATION
 
 
20.1
Contractor’s Indemnities

 
 
A.
Contractor, at its own expense, shall defend, indemnify and hold harmless the
Indemnified Companies (on behalf of themselves and on behalf of their respective
shareholders, directors, officers and employees [***]), from and against any
losses, damages, and other liabilities, adjudicated (or provided for in
settlement of the matter) to be owing to a third party claimant as well as costs
and expenses, including court costs and reasonable attorneys’ fees
(collectively, “Losses”), for death or personal injury to or damage to the
property of such third party, but only if such Losses were caused by, or
resulted from, a negligent act or omission or willful misconduct of Contractor
and/or its employees, subcontractors, agents, or representatives at any tier, or
any of them.  [***].  For the avoidance of doubt, the Satellite in any stage of
manufacture or operation shall not be considered as property subject to coverage
under this Article 20.1.  For purposes of this Article 20.1(A), the term “third
parties” shall not be interpreted as including any of the Indemnified Companies
([***]).

 
 
B.
Contractor, at its own expense, shall defend, indemnify and hold harmless the
Indemnified Companies (on behalf of themselves and on behalf of their respective
shareholders, directors, officers and employees and [***]), from and against all
range support and de-stacking charges to the extent not otherwise covered under
an Indemnified Companies’ policy of insurance, [***] (including without
limitation charges assessed to de-erect, place and maintain in storage, re-erect
and re-process the Launch Vehicle and Satellite and to re-integrate the
Satellite), levied against the Indemnified Companies by the Launch Agency for
the Satellite due to Launch delays caused by Contractor and/or its
Subcontractors, agents or representatives at any tier, or any of them, up to a
cumulative maximum of [***] U.S. Dollars ($[***]). [***].

 
 
C.
Contractor, at its own expense, shall defend, indemnify and hold harmless the
Indemnified Companies and their respective shareholders, directors, officers and
employees, from and against all Losses in connection with claims arising out of,
or relating to, Contractor’s breaches of its obligations in Article 4.4 (Tax).

 

Exhibit 10.1 Logos [logos.jpg]
 
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20.2
Purchaser’s Indemnity

 
Purchaser, at its own expense, shall defend, indemnify and hold harmless
Contractor (on its own behalf and on behalf of its directors, officers and
employees) from and against any Losses for death or personal injury to or damage
to the property of a third party claimant, but only if such Losses were caused
by, or resulted from, negligent acts or omissions or willful misconduct of
Purchaser or [***] employees or representatives.  The term “third parties” shall
not be interpreted as including Contractor or any of its directors, officers and
employees.
 
 
20.3
Conditions to Indemnification

 
The right to any indemnity specified in Article 19, Article 20.1 and Article
20.2 shall be subject to the following conditions:
 
 
A.
Purchaser shall be the only party entitled to enforce this Article on behalf of
itself and any of the Indemnified Companies, and the Parties agree that none of
the Indemnified Companies shall be considered as third party beneficiaries
entitled to enforce this Article directly against Contractor. The Party seeking
indemnification shall promptly advise the other Party in writing of the filing
of any suit or of any written or oral claim upon receipt thereof (provided that
any delay in providing such notice to Contractor shall relieve Contractor of its
indemnity obligations only to the extent that the delay materially prejudices
Contractor with respect to defense of such claim) and shall provide the other
Party, at its request and at the Indemnifying Party’s expense, with copies of
all documentation relevant to such suit or claim.

 
 
B.
The Party seeking indemnification shall not make any admission nor shall it
reach a compromise or settlement without the prior written approval of the other
Party, which approval shall not be unreasonably withheld or delayed.

 
 
C.
The indemnifying Party shall assist and assume, when not contrary to the
governing rules of procedure, the defense of any claim or suit in settlement
thereof and shall satisfy any judgments rendered by a court of competent
jurisdiction in such suits and shall make all settlement payments.  The Party
seeking indemnification may participate in any defense at its own expense, using
counsel reasonably acceptable to the indemnifying Party, provided there is no
conflict of interest and that such participation would not adversely affect the
conduct of the proceedings.

 

Exhibit 10.1 Logos [logos.jpg]
 
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20.4
Waiver of Subrogation

 
Each Party shall use reasonable efforts without incurring cost or expense to
obtain a waiver of subrogation and release of any right of recovery against the
other Party and its Affiliates, contractors and subcontractors at any tier
(including suppliers of any kind) and their respective directors, officers,
employees, shareholders and agents, that are involved in the performance of this
Contract and from any insurer providing coverage for the risks subject to
indemnification by the insured Party under this Article 20.
 
 
 
 
 
 
 
 
 

Exhibit 10.1 Logos [logos.jpg]
 
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restriction on the title page.
 
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Article 21 - TERMINATION FOR CONVENIENCE
 
 
21.1
Reimbursement of Contractor

 
 
21.1.1
Right to Terminate.  Purchaser may terminate this Contract without cause, in
whole or in part, upon giving Contractor written notice; provided, however,
Purchaser may not terminate this Contract without cause after Delivery of the
Satellite in accordance with Article 3.2.  Upon receipt of Purchaser’s notice of
termination for convenience, Contractor shall: (i) immediately stop the
terminated Work under this Contract; (ii) place no further orders or
subcontracts for materials, services or facilities to the extent that they
relate to the performance of the terminated Work; (iii) terminate orders and
subcontracts to the extent that they relate to the performance of the terminated
Work; (iv) where feasible, and on a reasonable best efforts basis, mitigate
Purchaser’s termination liability by application of any Satellite or other
materials or components to Contractor’s other satellite manufacturing programs;
and (v) settle all outstanding liabilities and all claims arising out of such
termination of orders and subcontracts.

 
 
21.1.2
Termination Liability.  If Purchaser terminates this Contract pursuant to this
Article 21, Contractor shall be entitled to the Actual Costs reasonably incurred
by Contractor (which costs shall be certified by Contractor’s Chief Financial
Officer, subject to Purchaser’s right to audit pursuant to Article 5.8) with
respect to: (a) terminated Work performed hereunder, plus a reasonable profit
not to exceed [***] percent on such Actual Costs; and (b) Actual Costs of
termination and settlement with all vendors and Subcontractors (provided that
Contractor shall undertake reasonable efforts to minimize any such costs), less
any credit resulting from the application of any Satellite or other materials or
components that Contractor can reasonably allocate to Contractor’s other
satellite manufacturing programs. In the event of termination by the Purchaser
of any of the Work, it is agreed that the termination charges shall be
negotiated pursuant to Article 21.1.4 below, but shall not exceed the lesser of:
[***]

 
 
21.1.3
Notwithstanding the above, in the event of a termination in part as provided
above, if such termination causes an increase in the Actual Costs of

 

Exhibit 10.1 Logos [logos.jpg]
 
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restriction on the title page.
 
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performing the remaining non-terminated Work, Contractor shall be entitled to a
corresponding increase (including a [***] percent profit) in the price of the
non-terminated Work.

 
 
21.1.4
Determination of Termination Liability.  Contractor shall submit a proposal to
Purchaser within sixty (60) days after the effective date of the termination,
which proposal shall specify the amount due to Contractor from Purchaser
pursuant to this Article 21 (the “Final Statement”). The Final Statement shall
be a complete statement of all amounts that are due to Contractor hereunder as
of the termination date for the terminated Work (together with reasonable
detailed back up data as may be requested by Customer). In the event that
Purchaser is not in agreement with the Final Statement, the Parties shall
negotiate an agreement based upon the Final Statement. After agreeing on the
Final Statement, Contractor shall invoice Purchaser and Purchaser shall pay such
invoice within thirty (30) days after Purchaser’s receipt of the invoice.

 
 
21.1.5
Contractor shall include in its contracts with suppliers and Subcontractors
terms that will enable it to terminate such contracts in a manner which
minimizes costs.

 
 
21.2
Disposition of Work

 
Upon payment by Purchaser to Contractor of the termination liability amounts due
under Article 21.1.2, subject to applicable U.S. Government export laws and
license conditions, Purchaser may direct Contractor to transfer to Purchaser
[***] in the manner and to the extent directed by Purchaser, title to and risk
of loss and possession of any items comprising the Work terminated (including
all Work-in-progress, parts and materials, all inventories, and associated
warranties but not including any portion of the Work to which Contractor would
not otherwise have been obligated to transfer title hereunder had the Contract
been completed).  Contractor shall, upon direction of Purchaser, protect and
preserve property at Purchaser’s expense in the possession of Contractor or its
Subcontractors in which Purchaser has an interest and shall facilitate access to
and possession by Purchaser of items comprising all or part of the Work
terminated.  [***].
 
[***]
 
 
 

Exhibit 10.1 Logos [logos.jpg]
 
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Sole Remedy
 
The remedy set forth in this Article shall be the sole remedy to which
Contractor is entitled for termination of Work under this Article. In the event
of a termination for convenience of the entire Contract, payment of the amount
payable by Purchaser to Contractor pursuant to this Article shall constitute a
total discharge of Purchaser’s liabilities to Contractor under this Contract,
except for those liabilities and/or obligations that survive pursuant to Article
34.13.
 
 
 
 
 
 
 
 
 
 
 
 
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 22 - LIQUIDATED DAMAGES
 
 
22.1
Liquidated Damages – Schedule/Delivery

 
The Parties acknowledge and agree that Contractor’s unexcused failure to achieve
the SPSR Complete Date on or before three (3) days prior to the date scheduled
for Satellite Delivery in Article 3.1 (the “Required SPSR Complete Date”) may
cause substantial financial loss to Purchaser.  The Parties further acknowledge
and agree that the following liquidated damages are believed to represent a
genuine and reasonable estimate of all losses that would be suffered by
Purchaser by reason of any such delay (which losses would be difficult or
impossible to calculate with certainty).
 
In the event that Contractor fails to achieve the SPSR Complete Date by the
Required SPSR Complete Date, then Contractor shall pay Purchaser, as liquidated
damages and not as a penalty, up to a cumulative maximum of [***] US Dollars
($[***]), the incremental amounts specified in Section 4.1 of Exhibit E as
liquidated damages, beginning on [***].
 
 
22.1.1
[***].

 
 
22.1.2
[***]

 
 
22.2
Remedy

 
Contractor and Purchaser agree that the actual damages that Purchaser would
suffer as a result of the late completion of the SPSR are, in the nature of this
transaction, difficult and impracticable to fix, that the liquidated damages set
forth herein are reasonable amounts to compensate Purchaser for such failures
and delays, and that the payment of liquidated damages is in lieu of payment of
actual damages for such failures and delays.  Such liquidated damages shall be
Purchaser’s sole and exclusive remedy and compensation for Contractor delays
with respect to late Delivery of Deliverable Items; provided, however, Purchaser
retains all rights and remedies under Article 21 regarding termination for
convenience, under Article 17 regarding termination for Force Majeure and
Article 23 regarding termination for default, as well as all of its rights with
respect to warranties under Article 15.2.1.  Contractor hereby waives, to the
extent permitted by applicable law, any defense as to the validity of any
liquidated damages in this Contract on the grounds that such liquidated damages
are void as penalties.
 

Exhibit 10.1 Logos [logos.jpg]
 
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Article 23 - TERMINATION FOR DEFAULT
 
 
23.1
Purchaser Rights of Termination

 
 
23.1.1
Right to Terminate.  Subject to Article 17, Article 18 and Article 23.1.4 below,
Purchaser may terminate this Contract in whole or in part by written notice to
Contractor if: (i) Contractor fails to complete SPSR by the Required SPSR
Complete Date plus [***] (or such longer time as may be agreed to in writing by
Purchaser); (ii) Contractor fails to make progress (including due to failure to
meet specification requirements) so as to endanger performance of this Contract
that it is reasonably likely Contractor will fail to complete SPSR by the time
allowed under clause (i) immediately above, and fails, within [***] days (or
such longer period as may be agreed to in writing by Purchaser) after receipt
from Purchaser of written notice thereof, to cure such breach or correct such
failure; or (iii) except for failures covered by items (i) and (ii) above,
Contractor fails to perform any material provision of this Contract and does not
correct such failure within a period of [***] days (or such longer period as
Purchaser may authorize in writing) after receipt of notice from Purchaser
specifying such failure.  [***].

 
 
23.1.2
Termination Liability.  In the event of termination pursuant to this Article
23.1,  Purchaser shall be entitled (i) to a refund by Contractor of all payments
made by Purchaser for the terminated Work (which in the case of a termination in
whole shall be a refund of all payments made by Purchaser hereunder) plus
interest thereon at the interest rate stipulated in Article 5.3.1 hereof from
the date payment was received to the date the refund is made to Purchaser and,
at Purchaser’s election, (ii) to retain and/or obtain Work as set forth in
Article 23.1.3 provided that if Purchaser so elects, Purchaser shall remain
liable for payment of all amounts for such Work as set forth in Article
23.1.3.  [***].  Contractor shall pay the amounts specified in this Article
23.1.2 no later than thirty (30) days after Contractor’s receipt of Purchaser’s
written notice requesting such amounts.

 
 
23.1.3
Contractor’s Reimbursement for Retained Work.  In the event Purchaser terminates
the Contract pursuant to this Article 23.1, Purchaser shall have the option to
obtain title to the Deliverable Items provided for under this

 

Exhibit 10.1 Logos [logos.jpg]
 
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Contract or associated Work-in-progress (but not to any Deliverable Item or
associated Work-in-progress to which Contractor would not have otherwise been
obligated to transfer title hereunder had the Contract been completed),
including, if requested by Purchaser in writing, assignment of Subcontracts,
subject to payment: (i) at the price set forth in this Contract for delivered
items for which an itemized price is set forth herein and (ii) at the Actual
Cost incurred by Contractor for (a) such items for which no itemized price is
set forth herein and (b) partially completed items and Work-in-progress.  This
sum shall be offset by amounts paid by Purchaser and received by Contractor for
Deliverable Items and Work-in-progress retained by Purchaser, and Contractor
shall protect and preserve property in the possession of Contractor in which
Purchaser has an interest.  Purchaser shall pay amounts due under this Article
21.1.3 no later than thirty (30) days after receipt of invoice from Contractor
with supporting data in reasonable detail.  Upon settlement and payment of
amounts due hereunder, Contractor, at Contractor's expense and subject to
applicable U.S. Government export control laws, shall promptly deliver such
Deliverable Items and Work-in-progress to Purchaser at Purchaser’s facility and
transfer title and risk of loss to Purchaser for the applicable Deliverable
Items and Work-in-progress.

 
 
23.1.4
Special Provision Limiting Purchaser’s Remedies.  Purchaser’s sole and exclusive
remedy with respect to delays in Delivery shall be as specified in Article 22
and this Article 23.1.  Purchaser shall have no right to terminate this Contract
pursuant to this Article 23.1 above on or after Intentional Ignition (unless and
to the extent of a Terminated Ignition pursuant to Article 12.1).

 
 
23.1.5
Disposition of the Work.  Except for items obtained by Purchaser as set forth in
Article 23.1.3, Contractor shall retain title to any and all Work,
Work-in-progress, parts or other material, inventories, and any associated
warranties, and any subcontracted items Contractor has specifically produced,
acquired, or subcontracted for in accordance with this Contract.

 
 
23.1.6
Invalid Default Termination.  If, after termination pursuant to this Article
23.1, it is finally determined pursuant to Article 25 or written agreement of
Purchaser that Contractor was not in default under Article 23.1.1, or that the

 
 
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default was excusable under the Contract, the rights and obligations of the
Parties shall be the same as if the termination had occurred under Article 21.

 
 
23.2
Contractor Rights of Termination

 
 
23.2.1
Right to Terminate.  Contractor may terminate this Contract upon provision of
written notice to Purchaser [***] if Purchaser fails to make any payment
required under this Contract, and Purchaser [***] shall fail to cure any such
default within [***] days after receiving written notice thereof from Contractor
(or such longer period as may be agreed to in writing by Contractor) (the “Cure
Period”).  Any notice of default provided by Contractor pursuant to this Article
23.2 shall be directed to Purchaser [***].  For the avoidance of doubt,
Contractor shall not be entitled to terminate this Contract for Purchaser’s
failure to make payment hereunder: (i) to the extent Purchaser has disputed such
payment in good faith pursuant to Article 5.6 (and any such Cure Period shall be
tolled until such time as the Disputed Payment has been resolved in accordance
with Article 5.6); and (ii) prior to both Purchaser [***] having received the
written cure notice required above [***] days prior to the termination
hereunder.

 
 
23.2.2
Termination Liability.  In the event of termination pursuant to this Article
23.2, Contractor shall be paid as if such termination were for convenience
pursuant to Article 21 plus any accrued late payment interest pursuant to
Article 5.3.  Payment of the total amounts payable by Purchaser pursuant to this
Article 23.2.2 shall constitute a total discharge of Purchaser’s liabilities to
Contractor for termination pursuant to this Article 23.2.

 
 
23.2.3
Disposition of the Work.  Upon completion of all payments to Contractor in
accordance with this Article 23.2, Purchaser may, subject to Article 7 hereof,
require Contractor to transfer to Purchaser in the manner and to the extent
directed by Purchaser, title to and possession of any items comprising all or
any part of the Work terminated (including all Work-in-progress, but not
including any other portion of the Work to which Contractor would not have
otherwise been obligated to transfer title hereunder had the Contract been
completed) not used or disposed of by Contractor pursuant to the foregoing
sentence.  Contractor shall, upon direction of Purchaser, protect and

 
Exhibit 10.1 Logos [logos.jpg]
 
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75

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preserve such items at Purchaser’s expense in the possession of Contractor or
its Subcontractors and shall facilitate access to and possession by Purchaser of
items comprising all or part of the Work terminated.  Contractor shall, if
requested by Purchaser in writing, assign to Purchaser or its designee such
Subcontracts as requested by Purchaser (subject to any approvals required by the
associated Subcontractors and receipt by Contractor of associated reasonable
releases and indemnifications in favor of Contractor).  Alternatively, to the
extent requested by Purchaser, where feasible, and on a reasonable best efforts
basis, Contractor shall apply such completed Work and work-in-progress to
Contractor’s other satellite manufacturing programs, and Purchaser shall receive
a refund of the amount paid therefor.

 
 
23.2.4
Invalid Default Termination.  If, after termination pursuant to this Article
23.2, it is finally determined pursuant to Article 25 or written agreement of
Contractor that Purchaser was not in default under Article 23.2.1, Contractor
shall be liable to Purchaser for direct damages resulting from such termination
of this Contract, subject to the limitation of liability set forth in Article 27
and in no event exceeding the amount that would be payable to Purchaser under
Article 23.1 [***].

 
 
23.2.5
[***].

 
[***].
 
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 24 - OPTIONS
 
 
 
 
24.1
Option Satellite

 
 
24.1.1
Purchaser shall have an option (the "Satellite Option"), which Purchaser may
exercise in writing at any time ("Satellite Option Exercise") during the period
from EDC [***], to order up to [***], including Satellite Baseband TC&R
Equipment, Satellite Unique Ground Products, and updates to Deliverable Data, as
required (the "Option Satellite").  Upon Satellite Option Exercise, Contractor
shall construct and Deliver the Option Satellite, and shall perform all Launch
Support Services, Mission Support Services, and other services (not including
training) in accordance with the terms and conditions of this Contract, except
as expressly modified by this Article 24.  Contractor shall Deliver each Option
Satellite on or before the later of [***].

 
 
24.1.2
The price for each Option Satellite shall be as set forth in Section 1.2.3 of
Exhibit E, Payment Plan.  Each Option Satellite price will include Launch
Support Services ([***]), Mission Support Services and other services required
to be provided by Contractor under this Contract.  The payment plan for the
Option Satellite shall be the payment plan applicable at the time of the
Satellite Option Exercise set forth in Section 2.3 of Exhibit E, Payment Plan
(with reference to "Option Satellite Payment Plan").

 
 
24.1.3
The Parties shall promptly incorporate the exercise of this option by executing
a separate contract for each Option Satellite on terms and conditions that are
substantially identical to this Contract.

 
 
24.1.4
Notwithstanding anything herein to the contrary, this Article 24.1 shall inure
solely to the benefit of Purchaser.

 
 
24.2
Replacement Satellite

 
 
24.2.1
Purchaser shall have an option (the "Satellite Replacement Option"), which
Purchaser may exercise in writing at any time ("Satellite Replacement Option
Exercise") during the period from EDC until the later of (a) EDC plus [***]
months and (b) provided that the Satellite has not been placed in Ground Storage
for reasons other that attributable to Contractor, [***] after Launch of

 

Exhibit 10.1 Logos [logos.jpg]
 
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restriction on the title page.
 
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the Satellite (or Total Loss of the Satellite in connection with a failed
Launch), to order a replacement satellite for the Satellite, including Satellite
Unique Ground Products and updates to Deliverable Data, as required (the
"Replacement Satellite").  Upon Satellite Replacement Option Exercise,
Contractor shall construct and Deliver the Replacement Satellite, and shall
perform all Launch Support Services, Mission Support Services and other services
(not including training) in accordance with the terms and conditions of this
Contract, except as expressly modified by this Article 24.  Contractor shall
Deliver the Replacement Satellite on or before [***] months from Satellite
Replacement Option Exercise.

 
 
24.2.2
The price for the Replacement Satellite shall be as set forth in Section 1.2.3
of Exhibit E, Payment Plan.  The total Replacement Satellite price includes
Launch Support Services, Mission Support Services and other services required to
be provided by Contractor under this Contract.  The payment plan for the
Replacement Satellite shall be the payment plan applicable at the time of the
Satellite Replacement Exercise set forth in Section 2.3 of Exhibit E, Price and
Payment Plan (with reference to "Replacement Satellite Payment Plan").

 
 
24.2.3
The Parties shall promptly incorporate the exercise of this option into the
Contract through an Amendment according to Article 34.5.

 
 
Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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24.3
Option for Test Bed

 
Purchaser shall have the option, which Purchaser may exercise in writing no
later than:
 
a.           [***]; and
 
b.           [***],
 
to request Contractor to deliver up to [***] for the price set forth in Section
1.2.1 of Exhibit E, Price and Payment Plan.  The delivery schedule and delivery
location for the Test Bed(s) shall be set forth in Section 9.0 of Exhibit A,
Statement of Work.  The payment terms are set forth in Section 2.2 of Exhibit E,
Price and Payment Plan.
 
 
24.4
[***]

 
[***]
 
 
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 25 - DISPUTE RESOLUTION
 
Any dispute, claim, or controversy between the Parties arising out of or
relating to this Contract (“Dispute”), including any Dispute with respect to the
interpretation, performance, termination, or breach of this Contract or any
provision thereof shall be resolved as provided in this Article 25.
 
 
25.1
Informal Dispute Resolution

 
Prior to the initiation of litigation, the Parties shall first attempt to
resolve their Dispute informally, in a timely and cost-effective manner, as
follows:
 
 
A.
If, during the course of the Work, a Party believes it has a Dispute with the
other Party, the disputing Party shall give written notice thereof, which notice
will describe the Dispute and may recommend corrective action to be taken by the
other Party.  Contractor’s program manager shall promptly consult with Purchaser
contract manager in an effort to reach an agreement to resolve the Dispute.

 
 
B.
In the event that agreement cannot be reached within ten (10) days of receipt of
written notice, either Party may request that the Dispute be escalated, and the
respective positions of the Parties shall be forwarded to an executive level
higher than that under Paragraph A above for resolution of the Dispute.

 
 
C.
In the event agreement cannot be reached within twenty (20) days of receipt of
written notice, either Party may request that the Dispute be escalated, and the
respective positions of the Parties shall be forwarded to the Chief Executive
Officer (CEO) or equivalent of each Party for resolution of the Dispute.

 
 
D.
In the event agreement is not reached as provided in Paragraphs A, B, or C above
within a total of sixty (60) days after receipt of the written notice described
in Paragraph A above, either Party may proceed in accordance with Article 25.2.

 
 
 
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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25.2
Litigation

        
Either Party shall be entitled to forego or terminate prematurely the informal
dispute resolution process specified in Article 25.1 in the event such Party
makes a good faith determination that (i) a Party determines in good faith that
amicable resolution through continued negotiation of the Dispute does not appear
likely, (ii) a breach by the other Party is such that a temporary restraining
order or other preliminary injunctive relief to enforce its rights or the other
Party’s obligations under the provisions of this Contract is necessary or (iii)
litigation is appropriate to avoid the expiration of an applicable limitations
period or to preserve a superior position with respect to creditors.
 
Any suit brought shall be brought in any court of competent jurisdiction in the
State of New York sitting in the Borough of Manhattan, and the Parties hereby
waive any objection to that venue and that court’s exercise of personal
jurisdiction over the case.  The Parties hereby irrevocably consent to the
exercise of personal jurisdiction by the state and federal courts in the State
of New York sitting in the Borough of Manhattan concerning any Dispute between
the Parties.  If, for any reason, neither the state nor federal courts in New
York sitting in the Borough of Manhattan will exercise jurisdiction over the
Dispute, then litigation as permitted herein may be brought in any court of
competent jurisdiction in the United States of America.
 
If a dispute arises as to whether or not a Party has committed or acted with
gross negligence or willful misconduct, that issue alone shall be resolved by a
New York court without a jury, and the court shall resolve such issue by
applying the laws of the State of New York without regard to its conflict of law
rules.  THE PARTIES EXPRESSLY WAIVE THEIR RIGHT TO A JURY IN CONNECTION WITH
SUCH DISPUTE.
 
Nothing in this Contract precludes a Party that prevails on any claim from
initiating litigation in any appropriate forum to enter or enforce a judgment
based on the court's award on that claim.
 
Pending final resolution of any dispute (including the informal dispute
resolution process and litigation), Contractor shall, unless otherwise directed
by Purchaser in writing, perform all its obligations under this Contract,
provided that Purchaser continues to make undisputed payments as they come due.
For purposes of clarification, Contractor shall not be entitled to stop work
under this Contract for Purchaser’s failure to make
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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payment hereunder to the extent Purchaser has disputed such payments in good
faith pursuant to Article 5.6.
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 26 - INTER-PARTY WAIVER OF LIABILITY FOR A LAUNCH
 
 
26.1
Launch Services Agreement Inter-Party Waiver of Liability

 
 
26.1.1
Inter-Party Waiver.  Each Party hereby agrees to be bound by the no-fault,
no-subrogation inter-party waiver of liability and related indemnity provisions
required by the Launch Services Agreement with respect to the Launch and to
cause their respective contractors and subcontractors at any tier (including
suppliers of any kind) that are involved in the performance of this Contract and
any other person having an interest in the Satellite or any Transponder thereon
(including customers of Purchaser) to accede to such waiver and indemnity, which
in every case shall include claims against the Launch Agency, either Party and
their respective contractors and subcontractors at any tier (including suppliers
of any kind)  that are involved in the performance of this Contract.  The
Parties shall execute and deliver any instrument that may be reasonably required
by the Launch Agency to evidence their respective agreements to be bound by such
waivers.

 
 
26.1.2
Waiver of Subrogation.  The Parties also shall use reasonable efforts to obtain
from their respective insurers, and shall require their respective contractors
and subcontractors at any tier (including suppliers of any kind) that are
involved in the performance of this Contract and any other person having an
interest in the Satellite or any Transponder thereon (including non-consumer
customers of Purchaser), to use reasonable efforts to obtain from their
respective insurers, an express waiver of such insurers' rights of subrogation
with respect to any and all claims that have been waived pursuant to this
Article 26 (such reasonable efforts not to include payment of additional amounts
or additional premiums for such waiver).

 

 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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26.2
Indemnity Related to the Inter-Party Waiver of Liability

 
Each Party shall indemnify against and hold harmless the other Party and/or its
contractors and subcontractors at any tier (including suppliers of any kind)
that are involved in the performance of this Contract, from and against any
claim made by the indemnifying Party and/or any of its contractors and
subcontractors (including suppliers of any kind) that are involved in the
performance of the Contract, or by any person having an interest in the
Satellite or Transponder thereon (including customers of Purchaser), or by
insurer(s) identified in Article 26.1, resulting from the failure of the
indemnifying Party to waive any liability against, or to cause any other person
the indemnifying Party is obligated to cause to waive any liability against, the
Launch Agency, the other Party or either of their contractors and subcontractors
at any tier (including suppliers of any kind) involved in the performance of
this Contract.  The Parties shall execute and deliver any instrument that may be
reasonably required by the Launch Agency to evidence their respective agreements
to be bound by such indemnifications.
 
 
26.3
Survival of Obligations

 
The waiver, indemnification and hold harmless obligations provided in this
Article 26 shall survive and remain in full force and effect, notwithstanding
the expiration or termination of this Contract.
 
 
26.4
Third Party Claims Coverage

 
With respect to third party liability for death or bodily injury or for the loss
of or damage to property that may be sustained, and any consequences thereof,
resulting from, or arising in connection with the performance of the Launch
Services for the Satellite, Purchaser shall use reasonable efforts to require
the Launch Agency to include Contractor (and any other party or entity as
Contractor may request) as an additional named insured under all policies of
third party claims coverage (or any other program of third party claims
coverage, including coverage provided by agencies of any government) that are
provided or required to be provided by or through the Launch Agency.
 
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 27 - LIMITATION OF LIABILITY
 
 
27.1
Limitation

 
EXCEPT AS PROVIDED OTHERWISE IN ARTICLES 27.3 AND 27.4, NEITHER PARTY SHALL BE
LIABLE DIRECTLY OR INDIRECTLY TO THE OTHER PARTY, TO ITS OFFICERS, DIRECTORS,
EMPLOYEES, CONTRACTORS OR SUBCONTRACTORS AT ANY TIER (INCLUDING SUPPLIERS OF ANY
KIND), AGENTS OR CUSTOMERS, TO ITS PERMITTED ASSIGNEES OR SUCCESSOR OWNERS OF
ANY SATELLITE OR OTHER DELIVERABLE ITEM OR TO ANY OTHER PERSON CLAIMING BY OR
THROUGH SUCH OTHER PARTY, FOR ANY AMOUNTS REPRESENTING LOSS OF PROFITS, LOSS OF
BUSINESS, OR INDIRECT, SPECIAL, INCIDENTAL, EXEMPLARY, CONSEQUENTIAL OR PUNITIVE
DAMAGES, INCLUDING WITHOUT LIMITATION LOST PROFITS, LOST REVENUES OR COSTS OF
RECOVERING A SATELLITE POST-LAUNCH, ARISING FROM OR RELATING TO THE PERFORMANCE
OR NONPERFORMANCE OF THIS CONTRACT OR ANY ACTS OR OMISSIONS ASSOCIATED THEREWITH
OR RELATED TO THE USE OF ANY ITEMS DELIVERED OR SERVICES FURNISHED HEREUNDER,
WHETHER THE BASIS OF SUCH LIABILITY IS BREACH OF CONTRACT, TORT (INCLUDING
NEGLIGENCE OF ANY TYPE (EXCEPT AS PROVIDED IN ARTICLE 27.3 BELOW) AND STRICT
LIABILITY), STATUTE OR OTHER LEGAL OR EQUITABLE THEORY.
 
 
27.2
Liability

 
EXCEPT AS PROVIDED OTHERWISE IN ARTICLES 27.3 AND 27.4, IN NO EVENT SHALL
CONTRACTOR’S TOTAL LIABILITY ARISING OUT OF OR RELATING TO  THIS CONTRACT EXCEED
THE [***] EXCEPT AS PROVIDED OTHERWISE IN ARTICLE 27.3 AND 27.4, IN NO EVENT
WILL PURCHASER’S TOTAL LIABILITY ARISING OUT OF OR IN CONNECTION WITH THIS
CONTRACT EXCEED [***].
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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27.3
Gross Negligence and Willful Misconduct

         
ARTICLE 27.1 SHALL NOT APPLY IN THE EVENT OF A PARTY’S GROSS NEGLIGENCE AND/OR
WILLFUL MISCONDUCT IN WHICH CASE SUCH PARTY MAY BE LIABLE AND RESPONSIBLE FOR
AMOUNTS REPRESENTING LOST PROFITS, LOSS OF BUSINESS AND THE OTHER DAMAGES
DESCRIBED IN ARTICLE 27.1 UP TO AN AMOUNT NOT TO EXCEED IN THE CUMULATIVE
MAXIMUM [***] UNITED STATES DOLLARS (US $[***]). THE FOREGOING AMOUNT SHALL BE
IN EXCESS OF ANY LIABILITIES SUBJECT TO ARTICLE 27.2.
 
 
27.4
Indemnities/Proprietary Information

 
ARTICLES 27.1 AND 27.2 SHALL NOT APPLY TO LIABILITY ARISING UNDER ARTICLES 19
(INTELLECTUAL PROPERTY INDEMNITY), 20 (INDEMNIFICATION) (AND IN BOTH CASES ONLY
AS TO LIABILITIES ADJUDICATED (OR PROVIDED IN SETTLEMENT OF THE MATTER) TO BE
OWING TO THE THIRD PARTY CLAIMANT AS WELL AS COSTS AND EXPENSES INCURRED IN
DEFENDING OR SETTLING SUCH CLAIMS), AND 26.2 (INDEMNITY RELATED TO THE
INTER-PARTY WAIVER OF LIABILITY).
 
 
27.5
Survival

 
THIS ARTICLE 27 SHALL SURVIVE THE EXPIRATION OR TERMINATION OF THIS CONTRACT FOR
WHATEVER CAUSE.
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 28 - DISCLOSURE AND HANDLING OF PROPRIETARY INFORMATION
 
 
28.1
Definition of Proprietary Information

 
For the purpose of this Contract, "Proprietary Information" means all
confidential and proprietary information (other than Deliverable Data, which is
subject to the provisions of Article 39) in whatever form transmitted, that is
disclosed or made available directly or indirectly by such Party (hereinafter
referred to as the "disclosing party") to the other Party hereto (hereinafter
referred to as the "receiving party") and: (i) is identified as proprietary by
means of a written legend thereon or (ii) if disclosed orally, is identified as
proprietary at the time of initial disclosure and then summarized in a written
document, with the Proprietary Information specifically identified, that is
supplied to the receiving party within ten (10) days of initial
disclosure.  Proprietary Information shall not include any information disclosed
by a Party that (i) is already known to the receiving party at the time of its
disclosure, as evidenced by written records of the receiving party, without an
obligation of confidentiality at the time of disclosure; (ii) is or becomes
publicly known through no wrongful act of the receiving party; (iii) is
independently developed by the receiving party as evidenced by written records
of the receiving party; or (iv) is rightfully obtained by the receiving party
from any third party without restriction and without breach of any
confidentiality obligation by such third party.
 
 
 
28.2
Terms for Handling and Use of Proprietary Information

 
Subject to Article 28.1, for a period of ten (10) years after receipt of any
Proprietary Information, the receiving party shall not disclose Proprietary
Information that it obtains from the disclosing party to any person or entity
except its employees, Affiliates (which, in the case of Purchaser Proprietary
Information is not a direct competitor of the Purchaser, and in the case of
Contractor Proprietary Information is not a Competitor), attorneys, agents,
representatives, subcontractors, consultants, financing entities, insurers,
potential and actual business partners, potential or actual sources of financing
and persons or entities who are engaging either Party in a potential or actual
merger, acquisition or other corporate or securities transaction (who/which in
all cases involving Purchaser Proprietary Information are not direct competitors
of the Purchaser, and in all cases involving Contractor Proprietary Information
is not a Competitor or an employee of a Competitor)  (collectively referred to
as “Representatives”) who have a need to know, who have been informed of and
have agreed in writing to abide by the receiving party’s
 

Exhibit 10.1 Logos [logos.jpg]
 
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restriction on the title page.
 
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obligations under this Article 28 (or are otherwise subject to confidentiality
obligations consistent with the obligations set forth herein), and who are
authorized pursuant to applicable U.S. export control laws and licenses or other
approvals to receive such information.  The receiving party shall use not less
than the same degree of care to avoid disclosure of such Proprietary Information
as it uses for its own Proprietary Information of like importance; but in no
event less than a reasonable degree of care.  Contractor shall use Proprietary
Information of Purchaser only for the purpose of performing the Contractor’s
obligations under this Contract, or as the Purchaser otherwise authorizes in
writing.  Purchaser shall use the Proprietary Information of Contractor only (i)
for the purpose of performing the Purchaser’s obligations under this Contract,
or (ii) in connection with the license rights granted to Purchaser pursuant to
Article 39.2(A), or (iii) as the Contractor otherwise authorizes in
writing.  For purposes of this Article 28, the receiving party shall be liable
for the acts of its Representatives to the same extent as if such acts of
Representatives had been committed by the receiving party.
 
 
 
28.3
Legally Required Disclosures

 
Notwithstanding the foregoing, in the event that the receiving party becomes
legally compelled to disclose Proprietary Information of the disclosing party
(including disclosures necessary or in good faith determined to be reasonably
necessary under the Securities Act of 1933, as amended, and the Securities
Exchange Act of 1934, as amended), the receiving party shall, to the extent
practicable under the circumstances, provide the disclosing party with written
notice thereof so that the disclosing party may seek a protective order or other
appropriate remedy, or to allow the disclosing party to redact such portions of
the Proprietary Information as the disclosing party reasonably deems
appropriate.  In any such event, the receiving party will, to the extent
practicable, disclose only such information as it reasonably determines is
legally required, and will cooperate with the disclosing party (at the
disclosing party’s expense) to seek proprietary treatment for any Proprietary
Information being disclosed and that is excludable under applicable
law.  Purchaser hereby provides notice to Contractor that Purchaser must
disclose this Contract pursuant to the securities and communications laws of the
United States, and confirms that it will consider in good faith any reasonable
and timely requests for redaction from Contractor.
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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28.4           Return of Confidential Information
 
Upon the request of the Party having proprietary rights to Proprietary
Information, the other Party in possession of such Proprietary Information shall
promptly return such Proprietary Information (and any copies, extracts, and
summaries thereof) to the requesting Party, or, with the requesting Party's
written consent, shall promptly destroy such materials (and any copies,
extracts, and summaries thereof), except for one (1) copy which may be retained
for legal archive purposes, and shall further provide the requesting Party with
written confirmation of same; provided, however, where both Parties have
proprietary rights in the same Proprietary Information, a Party shall not be
required to return such information to the other Party.  Nothing in this Article
28.4 shall require a Party to return or destroy computer files or records
containing Proprietary Information but only if and to the extent such files or
records were created in the ordinary course of business pursuant to such Party’s
automatic archiving and back-up procedures for computerized or word-processed
records.  The rights and obligations of the Parties under this Article shall
survive any return or destruction of Proprietary Information.
 
 
 
28.5
No License

 
Except as expressly provided in this Contract, nothing in this Contract shall be
construed as granting the receiving party whether by implication, estoppel, or
otherwise, any license or any right to use any Proprietary Information received
from the disclosing party, or use any patent, trademark, or copyright now or
hereafter owned or controlled by the disclosing party.
 
 
 
28.6
Injunctive Relief

 
The Parties agree that, in addition to any other rights and remedies that exist
under this Contract, in the event of a breach or threatened breach of this
Article 28, the disclosing party shall be entitled to seek an injunction
prohibiting any such breach. The Parties acknowledge that Proprietary
Information is valuable and unique and that disclosure in breach of this Article
may result in irreparable injury to the disclosing party.
 
 
 

Exhibit 10.1 Logos [logos.jpg]
 
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restriction on the title page.
 
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Article 29 -  CONTRACT TECHNOLOGY ESCROW
 
 
29.1
Segregation of Contract Technology/Escrow.

 
 
29.1.1
The Parties have entered into an escrow agreement (the “Escrow Agreement”),
dated as of EDC, in the form attached hereto as Exhibit F ([***]).  Pursuant to
the terms of the Escrow Agreement, Contractor shall deliver to the escrow agent
copies of all Contract Technology, and shall update such escrow
[***].  Purchaser shall pay [***] fees associated with establishing and
maintaining the Escrow Agreement, and Contractor, at no charge to Purchaser,
shall be responsible for gathering and depositing the Contract Technology into
the escrow. Purchaser shall be responsible for all escrow agent fees incurred in
connection with the withdrawal of Contract Technology under the Escrow
Agreement, once established.

 
 
29.1.2
Contractor represents and warrants that the Contract Technology kept at
Contractor’s facilities and delivered into escrow under the Escrow Agreement:

 
 
(i)
will comprise all of the Contract Technology (including the source code language
statement for any and all applicable Software) to the extent its retention is
consistent with Contractor’s normal retention policies;

 
 
(ii)
will be kept current, including all updates needed to maintain compliance with
the terms of this Contract; and

 
 
(iii)
will be in a form suitable for reproduction by Purchaser.

 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 30 - PUBLIC RELEASE OF INFORMATION
 
 
30.1
Generally

 
Either Party intending to disclose publicly, whether through the issuance of
news releases, articles, brochures, advertisements, prepared speeches or other
information releases, information concerning this Contract, the financial
details of this Contract or Proprietary Information of the other Party regarding
the Work shall obtain the prior written approval of the other Party with respect
to the content and timing of such issuance, which approval shall not be
unreasonably denied, delayed or withheld.
 
 
30.2
Exceptions

 
The obligations set forth in Article 30.1 shall not apply to the following:
 
 
a.
information that is publicly available from any governmental agency or that is
or otherwise becomes publicly available without breach of this Contract; and

 
 
b.
internal publications or releases which are clearly marked as not intended for
the public at large, provided such internal publications or releases do not
disclose financial details of the Contract or Proprietary Information of the
other Party.

 
 
c.
disclosure required by applicable law or regulation, including without
limitation, disclosure required by the Securities and Exchange Commission or the
Nasdaq Stock Market or any other securities exchange on which the securities of
a Party or its Affiliate is then trading.

 
 

Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 31 - NOTICES
 
 
31.1
Written Notification

 
Each notice or correspondence required or permitted to be given or made
hereunder shall be in writing (except where oral notice is specifically
authorized) to the respective addresses and facsimile numbers and to the
attention of the individuals set forth below, and any such notice or
correspondence shall be deemed given on the earlier to occur of (i) actual
receipt, irrespective of whether sent by post, facsimile transmission, overnight
courier or other method, and (ii) seven (7) days after mailing by registered or
certified mail, return receipt requested, postage prepaid.
 
In the case of Purchaser:
    Hughes Network Systems, LLC
    11717 Exploration Lane
    Germantown, MD 20876
    Attn:  General Counsel
    Fax No.: 301-428-2818
 
 
 
    With a separately delivered copy to:
       Hughes Network Systems, LLC
       11717 Exploration Lane
       Germantown, MD 20876
       Attn:  Jupiter Program Manager
       Fax No.: 301-428-7066
 
 
 
 

Exhibit 10.1 Logos [logos.jpg]
 
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restriction on the title page.
 
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   In the case of Contractor:       Space Systems/Loral, Inc.   3825 Fabian Way
  Palo Alto, CA  94303-4697   Attn.: Contract Manager, Stephen Smith  
Facsimile No.:  650-852-9864
          With a separately delivered copy to:   Space Systems/Loral, Inc.  
3825 Fabian Way
  Palo Alto, CA  94303-4697   Attn.: Program Manager, Lucio Caporicci  
Facsimile No.:  650-852-9864

 
 
31.2
Change of Address

 
Either Party may from time to time change its notice address or the persons to
be notified by giving the other Party written notice (as provided above) of such
new information and the date upon which such change shall become effective.
 
 

Exhibit 10.1 Logos [logos.jpg]
 
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restriction on the title page.
 
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Article 32 - RISK MANAGEMENT SERVICES
 
 
32.1
Purchaser Responsibility

 
Purchaser shall be responsible for procuring any Launch and In-Orbit Insurance
Policy covering the risks of loss or damage to the Satellite from and after
Intentional Ignition (the “Launch and In-Orbit Insurance Policy”).
 
IN NO EVENT SHALL PURCHASER DISCLOSE OR TRANSFER CONTRACTOR-PROVIDED TECHNICAL
INFORMATION OR PROVIDE TECHNICAL/DEFENSE SERVICES BASED ON CONTRACTOR-FURNISHED
TECHNICAL INFORMATION TO NON-U.S. PERSONS INCLUDING INSURANCE BROKERS OR
UNDERWRITERS OR OTHER NON-U.S. PERSONS OR ENTITIES (AS DEFINED IN 22 CFR SECTION
120.15 AND SECTION 120.16) WITHOUT CONTRACTOR’S PRIOR WRITTEN APPROVAL (SUBJECT
TO ARTICLE 32.2) AND, WHERE REQUIRED, PRIOR APPROVAL OF THE U.S. GOVERNMENT.
 
 
32.2
Contractor Support

 
At Purchaser’s request, Contractor shall perform the various insurance support
activities described in Exhibit A, Statement of Work and in this Article 32 on
behalf of Purchaser (including any applicable Purchaser Associates).  Subject to
Article 7 and Article 28, Contractor, at no additional charge to Purchaser
(including Purchaser Associates) hereunder, shall furnish Purchaser (or
Purchaser Associates, their respective underwriters and insurers, as required to
comply with applicable laws, regulations and authorizations) with such
information regarding the Satellite as is requested by the insurers and as is
customary and normal to support and assist Purchaser (including any applicable
Purchaser Associates) in obtaining and maintaining a Launch and In-Orbit
Insurance Policy or subsequent satellite in-orbit insurance policies for the
Satellite including but not limited to:  (i) providing a comprehensive
presentation package on the Satellite and the Launch Vehicles, suitable for
presentation to the space insurance brokers and underwriters; (ii) supporting
all necessary associated presentations (oral, written or otherwise), including
attendance and participation in such presentations where requested by Purchaser;
(iii) providing on a timely basis all reasonable and appropriate technical
information, data and documentation; (iv) providing documentation and answers to
insurer and underwriter inquiries; and (v) obtaining and maintaining any
 

Exhibit 10.1 Logos [logos.jpg]
 
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agreements and other approvals that are required (e.g., those agreements and
approvals required pursuant to Article 7.3) for Purchaser’s potential insurance
providers to have access to all information required by such potential
providers. Notwithstanding Article 28, Disclosure and Handling of Proprietary
Information and Article 30, Public Release of Information, but subject to
Article 7, Purchaser may disclose this Contract to its insurers, provided that
Purchaser has entered into binding agreements with such insurers that limits the
disclosure and use of such Contract on terms comparable to those contained
herein.
 
32.3           Claims Support
 
Subject to Article 7 and Article 28, Contractor, at no additional charge to
Purchaser, shall cooperate with and provide reasonable and customary support to
Purchaser (including Purchaser Associates) in making and perfecting claims for
insurance recovery and as to any legal proceeding as may be brought by Purchaser
[***] associated with any claim for Satellite insurance recovery.  Contractor
shall furnish Purchaser (including Purchaser Associates) with any information
that may be reasonably required to prepare and present any insurance claim
regarding the Satellite.
 
32.4           Contractor Insurance Requirements
 
During the period from EDC until Intentional Ignition (and in the event of a
Terminated Ignition, until the subsequent Intentional Ignition where Contractor
re-acquires title and risk of loss to the Satellite as provided in Article
12.1), Contractor shall obtain and maintain, at its own expense, insurance
coverage (the "Ground Insurance")  against all risks of loss, including
earthquake and other natural disasters, and damage to the Satellite and its
Components in an amount sufficient to cover the greater of: (i) the Contractor’s
full replacement value of the Satellite; and (ii) the amounts paid by Purchaser
with respect to the Satellite. Such insurance shall be on reasonable and
customary terms and shall include: (w) coverage for removal of debris, and
insuring the structures, machines, equipment, facilities, fixtures and other
properties constituting part of the project, (x) transit coverage, including
ocean marine coverage (unless insured by the supplier), (y) off-site coverage
for any key equipment, and (z) off-site coverage covering any property or
equipment not stored on the construction site. The deductible for such insurance
shall not exceed [***] U.S. dollars (U.S. $[***]). Contractor shall have
Purchaser and/or its designees named as an additional named insured on such
 

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insurance policy(ies) to the extent of their interest(s). Prior to commencing
the Work, and whenever requested by Purchaser, Contractor agrees to furnish to
Purchaser certificates of insurance evidencing that insurance required under
this Article is in full force and effect.
 
Without limiting the generality of the foregoing, and to the extent Contractor
is required to change material terms and conditions of such Ground Insurance,
Contractor shall notify Purchaser in advance (including by way of instructing
its Ground Insurance providers to provide such notice directly to Purchaser) of
any change to any material terms and conditions of said policies of insurance
which are relevant to this Contract, and, if any such change is made without
Purchaser’s consent (not to be unreasonably withheld), Contractor shall be
obligated to procure supplemental insurance coverage, subject to availability,
to comply with the insurance obligations set forth above. Contractor shall
provide certificates of insurance which shall contain an endorsement setting
forth that the insurer cannot terminate or materially amend the provisions of
the insurance without prior written notification to Purchaser at least [***]
days before such termination or amendment. If, after being requested in writing
by Purchaser to do so, Contractor fails to produce evidence of compliance with
Contractor’s insurance obligations hereunder within fourteen (14) days,
Purchaser may effect and maintain the insurance and pay the premiums, and
Contractor, at no charge, shall provide reasonable cooperation as requested by
Purchaser. The premiums paid by Purchaser shall be a debt due and payable from
Contractor to Purchaser, or Purchaser, at its option, may elect to offset
payments due Contractor.
 

Exhibit 10.1 Logos [logos.jpg]
 
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restriction on the title page.
 
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Article 33 - ORDER OF PRECEDENCE
 
In the event of conflict among the terms of this Contract (Preamble, Recitals,
and Articles 1 to 40) and the Exhibits, the following order of decreasing
precedence shall apply:
 
 o Contract terms and conditions  
 
(Preamble, Recitals and Articles 1 through 40)
 
 o Exhibit E  
 
Price and Payment Plan
 
 o Exhibit F
 
Escrow Agreement
 
 o Exhibit A
 
Statement of Work
 
 o Exhibit B 
 
Satellite Performance Specification
 
 o Exhibit C
 
Product Assurance Plan
 
 o Exhibit D Satellite Test Plan

 
 
 

Exhibit 10.1 Logos [logos.jpg]
 
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restriction on the title page.
 
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Article 34 - GENERAL
 
 
34.1
Assignment

 
 
34.1.1
General.  This Contract may not be assigned, either in whole or in part, by
either Party without the express written approval of the other Party, not to be
unreasonably withheld or delayed.

 
 
34.1.2
By Purchaser.  Notwithstanding the above, by written notice to Contractor,
Purchaser may at any time assign or transfer this Contract or all its rights,
duties, or obligations hereunder without Contractor’s approval (i) in connection
with obtaining financing for the Satellite; or (ii) to any entity (provided such
entity is not a Competitor of Contractor) that either (A) has, or has access to,
sufficient financial resources to fulfill Purchaser’s obligations under this
Contract or (B) has, [***], equivalent or greater financial resources as
Purchaser; or (iii) [***] in furtherance of a cure of Purchaser’s default in
accordance with Article 23.2.5; provided in each case the assignee, transferee,
or successor of Purchaser expressly assumes all the obligations of Purchaser and
all terms and conditions applicable to Purchaser under this Contract.  After any
such assignment, Purchaser shall have no further obligations hereunder, other
than as provided in Article 34.13 which shall continue to be binding on
Purchaser.

 
 
34.1.3
By Contractor.  Notwithstanding Article 34.1.1, by written notice to Purchaser,
Contractor may assign or transfer this Contract or all of its rights, duties, or
obligations hereunder to: (i) any Affiliate of Contractor that has equivalent or
greater financial resources as Contractor (provided that such Affiliate is not a
competitor of Purchaser) and has the ability to perform all of Contractor’s
obligations hereunder; or (ii) any person in connection with the sale, transfer,
merger, assignment or other reorganization affecting Contractor or all (or
substantially all) of Contractor’s assets or capital stock, whether by way of
merger, consolidation, or otherwise; provided that in each case the assignee,
transferee, or successor of Contractor has acquired directly or indirectly all
or substantially all of the assets and relevant personnel of Contractor, and has
expressly assumed all the obligations of Contractor and all terms and conditions
applicable to Contractor under this Contract.

 

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34.1.4
Security Interests.  Either Party, upon prior written notice to the other Party,
may grant security interests in its rights hereunder to lenders that provide
financing for the performance by such Party of its obligations under this
Contract or for the subject matter hereof.  In the event that either Party is
sold to or merged into another entity, its responsibilities under this Contract
shall not be altered and the successor organization shall be liable for
performance of such Party’s obligations under this Contract.

           
 
34.2
Binding Effect

 
This Contract shall be binding upon and inure to the benefit of the Parties and
their respective successors and permitted assigns.  Assignment of this Contract
shall not relieve the assigning Party of any of its obligations nor confer upon
the assigning Party any rights except, in each case, as provided in this
Contract.
 
 
34.3
Severability

 
If any provision of this Contract is declared or found to be illegal,
unenforceable or void, the Parties shall negotiate in good faith to agree upon a
substitute provision that is legal and enforceable and is as nearly as possible
consistent with the intentions underlying the original provision.  If the
remainder of this Contract is not materially affected by such declaration or
finding and is capable of substantial performance, then the remainder shall be
enforced to the extent permitted by law.
 
 
 
34.4
Waiver of Breach of Contract

 
A waiver of any provision or any breach of a provision of this Contract shall
not be binding upon either Party unless the waiver is in writing, signed by a
duly authorized representative of the Party to be bound, as applicable, and such
waiver shall not affect the rights of the Party not in breach with respect to
any other or future breach.  No course of conduct by a Party shall constitute a
waiver of any provision or any breach of a provision of this Contract unless a
written waiver is executed in accordance with the provisions of this Article
34.4.
 
 
34.5
Amendments

 
This Contract, including any and all its Exhibits, may not be modified except by
written instrument of subsequent date signed by an officer of Contractor, or
another person
 
 
  
Exhibit 10.1 Logos [logos.jpg]
 
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restriction on the title page.
 
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designated in writing by any such officer to sign such an instrument, and an
authorized officer of Purchaser, or another person designated in writing by any
such authorized officer of Purchaser to sign such an instrument.
 
 
34.6
Captions

 
The captions contained herein are for purposes of convenience only and shall not
affect the construction of this Contract.
 
 
34.7
Relationships of the Parties

 
It is expressly understood that Contractor and Purchaser intend by this Contract
to establish the relationship of independent contractors only, and do not intend
to undertake the relationship of principal and agent or to create a joint
venture or partnership or any other relationship, other than that of independent
contractors, between them or their respective successors in interests.  Neither
Contractor nor Purchaser shall have any authority to create or assume, in the
name or on behalf of the other Party, any obligation, express or implied, or to
act or purport to act as the agent or the legally empowered representative of
the other Party, for any purpose whatsoever.
 
 
 
 
34.8
Entire Agreement

 
This Contract, including all its Exhibits, represents the entire understanding
and agreement between the Parties hereto with respect to the subject matter
hereof, and supersedes all prior negotiations and agreements with respect to the
subject matter hereof, which cease to have any further force or effect.
 
 
34.9
Standard of Conduct

 
Both Parties agree that all their actions in carrying out the provisions of this
Contract shall be in compliance with applicable laws and regulations and neither
Party will pay or accept bribes, kickbacks or other illegal payments, or engage
in unlawful conduct.
 
 
34.10
Construction

 
This Contract, including all its Exhibits, has been drafted jointly by the
Parties and in the event of any ambiguities in the language hereof, there shall
be no inference drawn in favor of or against either Party.
 
 
Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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34.11
Counterparts

 
This Contract may be signed in any number of counterparts with the same effect
as if the signature(s) on each counterpart were upon the same instrument.
 
 
34.12
Applicable Law

 
This Contract shall be interpreted, construed and governed, and the rights of
the Parties shall be determined, in all respects, according to the laws of the
State of New York without reference to its conflicts of laws rules other than
Section 5-1402 of the New York General Obligations Law.
 
 
34.13
Survival

 
Termination or expiration of this Contract for any reason shall not release
either Party from any liabilities or obligations set forth in this Contract that
(i) the Parties have expressly agreed shall survive any such termination or
expiration or (ii) remain to be performed and/or by their nature would be
intended to be applicable following any such termination or expiration.
 
 
34.14
U.N. Convention on the International Sales of Goods

 
The U.N. Convention on the International Sales of Goods shall not apply or
otherwise have any legal effect with respect to this Contract.
 
 
34.15
Third-Party Beneficiaries

 
This Contract is entered into solely between Purchaser and Contractor, and may
be enforced only by Purchaser and Contractor and their permitted assigns, and is
not intended to confer any further benefits or rights beyond those expressly
given; this Contract shall not be deemed to create any rights in, or liabilities
to, third parties, including suppliers, customers, [***] and owners of a Party,
or to create any obligations of a Party to any such third parties, none of which
may enforce any provision in this Contract, without limitation.  Contractor and
Purchaser expressly reserve the right to modify, amend, terminate or otherwise
modify, any provision in this Contract, including those that mention [***],
without the consent of, or notice to, any third party, including [***].
 
 

Exhibit 10.1 Logos [logos.jpg]
 
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restriction on the title page.
 
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Article 35 - GROUND STORAGE
 
 
35.1
Notification

 

 
Purchaser may direct Contractor in writing to store the Satellite after
completion of SPSR.  If so directed Contractor shall store the Satellite and
related equipment for up to three (3) years (“Ground Storage”) in accordance
with Article 35.2 below.

 
 
35.2
Storage Location

 

 
Ground Storage shall be performed at Contractor’s own facility and shall be
conducted in accordance with the satellite storage plan set forth in Section
10.2 of the Program Management Plan.

 
 
35.3
Storage Costs

 

 
Subject to Article 35.4, Purchaser shall pay Contractor for any Ground Storage
in excess of [***] at the rate of [***] US Dollars ($[***]) per month (which
shall include all insurance costs) plus the Actual Costs of any post-storage
re-verification testing that is required due to the Satellite being in Ground
Storage in excess of [***].  In addition, Contractor shall begin to earn its
Orbital Performance Incentives thirty (30) days after the date the Spacecraft is
placed in Ground Storage, and Purchaser shall begin making the quarterly
payments of earned Orbital Performance Incentives at the end of the [***] full
calendar month thereafter.  While the Satellite is in storage, the Satellite
shall be deemed to have no Transponder Failures for purposes of calculating
Orbital Performance Incentives.  The foregoing shall be Purchaser’s sole
liability for Storage Costs.

 
 
35.4
Equitable Allocation of Storage Costs

 
Notwithstanding the foregoing, in the event that Ground Storage is required
primarily due to the fault of, or reasons attributable to, Contractor, all
Storage Costs (including insurance costs) shall be borne by Contractor and
Orbital Performance Incentives shall not be payable during the period of Ground
Storage, provided that Purchaser schedules with the Launch Agency the next
available Launch opportunity that is reasonably satisfactory to Purchaser and
which is consistent with the Satellite’s availability for Launch.  In the event
the Satellite is initially placed in Ground Storage due to the fault of
Contractor, but Purchaser does not schedule with the Launch Agency the next
available Launch opportunity reasonably satisfactory to Purchaser and which is
consistent with the Satellite’s availability for Launch: (A) Contractor shall be
responsible for all Storage costs
 
Exhibit 10.1 Logos [logos.jpg]
 
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for the period of time up to the next available Launch opportunity reasonably
satisfactory to Purchaser and which is consistent with the Satellite’s
availability for Launch, plus [***] (the “Free Storage Period”); (B) Purchaser
shall be responsible for payment of those amounts set forth in paragraph 35.3,
above, for the period of Ground Storage beginning with the first day after the
end of the Free Storage Period; and (C) Orbital Performance Incentives shall
begin to accrue on the day following the Free Storage Period.
 
 
35.5
Payment of Storage Costs

 

 
Payments of Storage Costs in excess of [***] storage shall be made on the last
day of each month for the prior month’s storage, provided an invoice is received
at least thirty days prior to the payment date.

 
 
35.6
Title and Risk of Loss

 

 
Title and risk of loss to the Satellite delivered for Ground Storage shall
remain with Contractor at the storage site. Contractor shall assume full
responsibility for any loss or damage to the Satellite during Ground Storage.

 
 
35.7
Notification of Intention to Launch a Previously Stored Satellite

 
In the event a Satellite is placed in Ground Storage, Purchaser shall notify
Contractor in writing when the Satellite should be removed from Ground Storage
and delivered to the Launch Site.  This notification must be received by
Contractor not less than three (3) months, or such shorter period as is
reasonably acceptable to Contractor, prior to the scheduled date for Launch of
the Satellite.
 
 
 

Exhibit 10.1 Logos [logos.jpg]
 
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restriction on the title page.
 
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Article 36 -[***]
 
 
 
 
36.1
[***]

 
[***]
 
 
 
 
 
 
 
 
Exhibit 10.1 Logos [logos.jpg]
 
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
 
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Article 37 - CONTRACTOR PERSONNEL
 
 
37.1
Contractor Personnel

 
The Contractor will assign only properly qualified and experienced personnel to
the Work contemplated under the Contract, and Contractor shall use reasonable
efforts to retain such personnel on the Work for its duration. At the reasonable
request of Purchaser, Contractor shall not use, and shall not permit any
Subcontractor to use, in the performance of the Work any personnel deemed by
Purchaser to be abusive, disorderly, incompetent, careless, unqualified to
perform the Work assigned, or otherwise unsatisfactory to Purchaser. Without
limiting the generality of the foregoing, Contractor shall, within ten (10)
Business Days after receiving notice from Purchaser, remove from the performance
of the Work, and, as soon as is reasonably practicable, replace, any personnel
of Contractor or any Subcontractor who is performing any portion of the Work, if
Purchaser reasonably believes that such personnel is creating a risk to the
timely or safe completion of the Work in accordance with this Contract.
 
 
37.2
Key Personnel as of EDC

 
Personnel assigned to the following positions shall be considered “Key
Personnel,” and, as of the date of EDC, shall be filled by the following
Contractor employees:
 
a) the Contractor’s Program Manager: [***];
b) the Contractor’s Contracts Manager: [***];
c) the Contractor’s Systems Engineering Manager: [***];
d) the Contractor’s Payload Manager: [***]; and
e) Contractor’s Integration and Test Manager: [***].
 
Purchaser may from time to time change the positions designated as Key Personnel
under this Contract on sixty (60) days notice to Contractor and with mutual
agreement of the Contractor, not to be unreasonably withheld or delayed.
 
 
37.3
Assignment of Key Personnel

 
Contractor shall assign individuals only from within Contractor’s organization
to fill the Key Personnel positions. All Key Personnel shall have significant
and reasonable relevant experience and expertise. Before assigning an individual
to any Key Personnel
 
 
Exhibit 10.1 Logos [logos.jpg]
 
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position, whether as an initial assignment or a subsequent assignment,
Contractor shall notify Purchaser of the proposed assignment, shall introduce
the individual to Purchaser (and, upon request of Purchaser, provide Purchaser
with the opportunity to interview the individual) and shall provide Purchaser
with a resume and other information reasonably requested by Purchaser. If
Purchaser in good faith objects to the proposed assignment within fifteen (15)
Business Days after being notified thereof, Contractor shall not assign the
individual to that position and shall propose to Purchaser the assignment of
another individual of suitable qualifications and experience, the criteria of
which are to be mutually agreed by Purchaser and Contractor acting reasonably.
Should the individuals filling the positions of Key Personnel leave such
positions for whatever reason, Contractor shall follow the procedure set forth
in this Article to assign replacement personnel. Key Personnel shall not be
assigned to other duties without the Purchaser giving prior written consent.
 
 
 
 
 
 
 
 
 

Exhibit 10.1 Logos [logos.jpg]
 
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restriction on the title page.
 
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Article 38 -SUBCONTRACTS
 
 
38.1
Major Subcontracts

 
Contractor shall select Major Subcontractors subject to Purchaser’s prior
written approval, and Purchaser shall be provided with complete copies of all
Major Subcontracts ([***]) promptly upon execution thereof. For purposes of this
Contract, a “Major Subcontract” shall be any Subcontract that has a contract
value of at least [***] US dollars ($[***]), or, in the event Contractor issues
Subcontracts therefor, for those items set forth below. In the event Contractor
or any Subcontractor desires to terminate any Major Subcontractor or to
substitute Subcontractors on any Major Subcontract, Contractor shall first
notify Purchaser in writing. To the extent that the Contractor elects to procure
the following items from Subcontractors, those Subcontractors shall be Major
Subcontractors: [***].
 
 
38.2
No Privity of Contract

 
Subject to the provisions of this Article, Contractor shall have the right to
use such Subcontractors as may be necessary to perform the Work under this
Contract. Nothing in this Contract shall be construed as creating any
contractual relationship between Purchaser and any Subcontractor. Contractor is
fully responsible to Purchaser for the acts or omissions of Subcontractors and
of any other parties used by Contractor or a Subcontractor in connection with
the performance of the Work. Any failure by a Subcontractor to meet its
obligations to Contractor shall not constitute a basis for Force Majeure (except
where such failure is itself a Force Majeure event), and shall not relieve
Contractor from meeting any of its obligations under this Contract.
Notwithstanding anything to the contrary herein, Purchaser’s acknowledgment or
approval of any Major Subcontractor or Subcontractor shall not relieve
Contractor from any of its obligations or responsibilities under this Contract.
 

Exhibit 10.1 Logos [logos.jpg]
 
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restriction on the title page.
 
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Article 39 - INTELLECTUAL PROPERTY
 
 
39.1
Ownership

 
 
A.
Subject to the licenses granted to Purchaser in Article 39.2, Contractor shall
retain and own all rights, title and interest in and to all Contractor
Intellectual Property.

 
 
B.
Subject to the licenses granted to Contractor in Article 39.2, Purchaser shall
retain and own all rights, title and interest in and to all Purchaser
Intellectual Property.

 
 
39.2
Licenses and Restrictions

 
 
A.
Contractor grants to Purchaser ([***]) a nonexclusive, perpetual, irrevocable,
royalty-free, license, with the right to sublicense, except to Competitors,
subject to the same limitations applicable to Purchaser to Exploit the
Contractor Intellectual Property.  Any sublicense granted under this Article
39.2(A) shall be in writing and Contractor shall be provided with complete
copies of such sublicense promptly upon grant thereof.  Purchaser shall be
liable for the acts of its sublicensees to the same extent as if such acts of
sublicensees had been committed by Purchaser.

 
 
 
[***].

 
 
B.
(i) Subject to the terms of this Contract, Purchaser grants to Contractor a
nonexclusive, nontransferable, nonassignable, royalty-free license, only during
the term or until termination of this Contract, with no right to sublicense
(except to Subcontractors), under the Purchaser Intellectual Property solely for
the purposes of Contractor’s performance of the Work under this Contract and for
no other purposes whatsoever. Any sublicense granted under this Article 39.2(B)
shall be in writing. Contractor shall be liable for the acts of its sublicensees
to the same extent as if such acts of sublicensees had been committed by
Contractor.

 
 
C.
Neither Party shall have a license to use the trademarks or service marks of the
other Party without such other Party’s express written consent.

 
 
D.
There are no implied licenses under this Contract, and any rights not expressly
granted by a Party to the other Party hereunder shall be reserved by such Party.

 
 
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Each Party agrees not to reverse engineer the Intellectual Property of the other
Party provided to such Party in connection herewith. Each Party agrees not to
file for patents covering the Intellectual Property Rights owned by the other
Party hereto.

 
 
E.
Contractor shall make reasonable efforts to secure for Purchaser from each Major
Subcontractor entering into a subcontract on or after EDC at least the same
rights with respect to such Major Subcontractor’s Intellectual Property as are
provided to Purchaser in this Article 39 with respect to Contractor Intellectual
Property (such reasonable efforts not to include payment of additional amounts
for such rights).

 
 
 
 
 
 
 
 

Exhibit 10.1 Logos [logos.jpg]
 
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restriction on the title page.
 
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Article 40 - FINANCING REQUIREMENTS
 
 
The Parties recognize this Contract may be financed or funded either wholly or
partially involving external sources. Notwithstanding anything to the contrary
in this Contract, except for restrictions and conditions set forth in Article 7
and Article 28, Purchaser and Contractor may provide to any Financing Entity any
information (including, without limitation, this Contract) that such Financing
Entity reasonably requires. Purchaser and Contractor agree to negotiate in good
faith and issue such documents as may be reasonably required by any Financing
Entity to implement such financing, including a contingent assignment of this
Contract to such Financing Entity, under customary terms reasonably acceptable
to Contractor and Purchaser, and to the extent applicable, subject to the
provisions of Article 16 hereof and to any limitations as may be imposed by
operation of Article 13.13 hereof.
 
 
 

Exhibit 10.1 Logos [logos.jpg]
 
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restriction on the title page.
 
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Article 41 - SECURITY INTEREST
 
41.1           Security Interest
 
 
41.1.1
Collateral.  As collateral security for payment and performance by Contractor of
all obligations of Contractor to or for the benefit of Purchaser under this
Contract, as well as all damages to which Purchaser may be entitled as a result
of any breach of this Contract (all of such obligations, the “Secured
Obligations”), Contractor hereby grants to Purchaser a security interest (the
“Security Interest”) in all of Contractor's right, title and interest in, to and
under the following property, whether owned as of EDC or thereafter acquired by
Contractor and whether existing on EDC or thereafter coming into existence
(collectively, the “Collateral”):

 
 
a.
The following [***]; and

 
 
b.
all [***].

 
 
41.1.2
Contractor Actions in Support of Grant of Security Interest.  In furtherance of
the grant of the Security Interest, Contractor:

 
 
a.
shall give, execute, deliver, file, record, obtain, and authorize all financing
statements, intellectual property security agreements, and any other notices,
instruments, agreements and documents, and Contractor shall take such other
action as reasonably requested by Purchaser (1) to create, perfect, validate and
preserve the Security Interest and the priority thereof or (2) to enable
Purchaser to exercise and enforce its rights hereunder with respect to such
pledge, grant and Security Interest, and, in the event the Protocol of Space
Assets to the Cape Town Convention on Mobile Goods (the “Protocol”) is ratified
by the United States and becomes effective, Contractor shall take all action
required thereunder to protect and preserve the Security Interest of Purchaser
hereunder;

 
 
b.
shall indicate in its corporate records the Security Interest that Purchaser has
in the Collateral [***];

 
 
c.
hereby authorizes Purchaser to file UCC-1 financing statements with respect to
the Security Interest;

 
 
 
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d.
[***];

 
 
e.
[***];

 
 
f.
[***]; and

 
 
g.
[***].

 
 
41.1.3
Contractor Representations and Warranties in Support of Grant of Security
Interest.  Contractor represents and warrants that the Security Interest
constitutes a legal, valid and enforceable security interest therein and upon
the filing of UCC-1 financing statements in the office of the Secretary of State
of Delaware will be a first priority perfected security interest in those items
that can be perfected by filing under the UCC subject to no other liens or
security interests other than Junior Liens (as defined below),
[***].  Contractor further represents and warrants that it is duly organized as
a corporation solely under the laws of the State of Delaware, and that its full
legal name is set forth is as set forth on the signature pages
hereof.  Contractor further represents and warrants that as of the date hereof,
no authorization, approval, or other action by, and no notice to or filing with,
any U.S. governmental authority or regulatory body is required for either (i)
the grant of the Security Interest hereunder, or (ii) the exercise by Purchaser
of any rights or remedies in respect of any Collateral (whether specifically
granted or created hereunder or provided for by applicable law), except for the
filing of UCC-1 financing statement in the State of Delaware, any filings under
federal statutes in respect of Intellectual Property Rights, any filings to
perfect the Security Interests under laws outside the United States, any filings
to perfect security interests under provisions other than the UCC, and any
actions in connection with enforcement rights required under applicable export
restrictions and security regulations.

 
 
41.1.4
Junior Liens.  On and after EDC, Contractor shall not lend, rent, lease,
transfer or otherwise dispose of any portion of the Collateral or any right,
title or interest therein except to Purchaser pursuant to the Contract and
Contractor shall keep such Collateral free from any security interest, lien,
encumbrance or claim.  Notwithstanding the foregoing, Contractor shall be
permitted to grant [***] of Contractor and its Affiliates from time to time,
including reimbursement

 
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obligations in respect of letters of credit (collectively, “Permitted Debt”),
provided that the terms of such Junior Liens shall be expressly subordinated to
the Security Interest and otherwise be acceptable to Purchaser.  Prior to
granting any Junior Lien on the Collateral ([***]), Contractor shall provide
written notice to Purchaser describing the circumstances of such Junior Lien
(including the identity of the proposed holder of such Junior Lien and the
nature of the Permitted Debt).  Within ten (10) Business Days after receipt of
such notice, Purchaser shall give notice to Contractor whether such proposed
Junior Lien is acceptable to Purchaser in its reasonable discretion and, if
acceptable, provide the terms for such Junior Lien that would be reasonably
acceptable to Purchaser.  [***].

 
 
41.1.5
Periodic Inventory.  Upon the reasonable request of Purchaser (not to occur more
often than [***]), Contractor shall provide Purchaser a written inventory
describing the [***] as of the time of such request.

 
 
41.1.6
Exercise of Rights.  On and after EDC, Purchaser shall have and be entitled to
exercise all the rights and remedies with respect to the Collateral of a secured
party under the UCC (whether or not the UCC is in effect in the jurisdiction
where Purchaser asserts the rights and remedies) and such additional rights and
remedies as provided in this Contract.  Effective at the moment at which
Purchaser is entitled to terminate the Contract pursuant to Article 23.1.1
([***]), Purchaser shall have the right, subject to applicable export control
restrictions and security regulations, to take possession of the Collateral or
any part thereof upon ten (10) days notice to Contractor, and, subject to
applicable export control restrictions and security regulations, Contractor
shall assemble the Collateral in the location or locations specified by
Purchaser and give Purchaser access to Contractor’s premises for purposes of
inspecting and/or removing any or all of the Collateral.  [***].

 
 
41.1.7
Sale of Collateral.  If the Proceeds of sale, collection or other realization of
or upon the Collateral are insufficient to cover the Secured Obligations,
Contractor shall remain liable for any deficiency.  Purchaser shall not incur
any liability as a result of the sale of the Collateral, or any part thereof, at
any private sale pursuant to Article 41.1.6 conducted in a commercially
reasonable manner and

 
 
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otherwise in compliance with the UCC and applicable export control
restrictions.  Contractor hereby waives any claims against Purchaser arising by
reason of the fact that the price at which the Collateral may have been sold at
such a private sale was less than the price that might have been obtained at a
public sale or was less than the aggregate amount of the Secured Obligations,
even if Purchaser accepts the first offer received and does not offer the
Collateral to more than one offeree, so long as the sale was conducted in a
commercially reasonable manner.  Purchaser may be the purchaser of any or all of
the Collateral at any public or private (to the extent any portion of the
Collateral being privately sold is of a kind that is customarily sold on a
recognized market or subject of widely distributed standard price quotations)
sale in accordance with the UCC, at a price as determined in accordance with
Article 23.1.3, and Purchaser shall be entitled, for the purpose of bidding and
making settlement or payment of the purchase price for all or any part of the
Collateral sold at any such sale made in accordance with the UCC, to use and
apply any of the Secured Obligations as a credit on account of the purchase
price for any Collateral payable by Purchaser at such sale.  Purchaser may sell
the Collateral without giving any warranties as to the Collateral.  Purchaser
may specifically disclaim or modify any warranties of title or the like.  This
procedure will not be considered to adversely affect the commercial
reasonableness of any sale of the Collateral.  Notwithstanding any Junior Liens,
Purchaser shall have no obligation to marshal any of the Collateral.

 
 
41.1.8
Application of Proceeds.  Except as otherwise herein expressly provided and
except as provided below in this Article 41.1.8, the Proceeds of any collection,
sale or other realization of all or any part of the Collateral pursuant hereto,
[***]: (i) first, to the payment of the costs and expenses of such collection,
sale or other realization; (ii) second, to the payment in full of the amounts
due to Purchaser as set forth in Article 23.1.2, (iii) third, to satisfy any
other Secured Obligations, (iv) fourth, to the payment of any Junior Liens
secured by such Collateral, and (v) fifth, to the payment to the Contractor, or
its respective successors or assigns, or as a court of competent jurisdiction
may direct, of any surplus then remaining.  Notwithstanding anything to the
contrary in this Contract, the Proceeds from the sale, disposition or other
realization of the

 
 
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Collateral may be applied to the payment of Secured Obligations only to the
extent expressly set forth in this Article 41.1.8.

 
 
41.1.9
Appointment as Attorney in Fact.  On and after EDC, without limiting any rights
or powers granted by Article 41 to Purchaser, while Purchaser is not entitled to
terminate the Contract in whole for Contractor’s default in accordance with
Article 23.1.1 ([***]), Purchaser is hereby appointed the attorney in fact of
the Contractor for the purpose of carrying out the provisions of the Security
Interest and taking any action and executing any instruments that Purchaser may
reasonably deem necessary or advisable to accomplish the purposes hereof, which
appointment as attorney in fact is irrevocable and coupled with an interest.

 
 
41.1.10
Reasonable Supporting Actions.  Contractor agrees that, from time to time upon
the written request of Purchaser on and after EDC, Contractor will execute and
deliver such further documents and do such other acts and things as Purchaser
may reasonably request in order to fully effectuate the purposes of this Article
41.  Contractor shall not change its name or jurisdiction of incorporation
unless Contractor shall, within [***] days prior to such change, give written
notice thereof and shall take all action reasonably requested by Purchaser to
preserve the validity, perfection and priority of the Security Interest.

 
 
41.1.11
Termination of Security Interest.  After a valid termination of this Contract
pursuant to Article 21, Article 23.2, Article 23.1.1 or Article 23.1.6, each of
the foregoing in accordance with the respective terms, Contractor may, on behalf
of Purchaser, file any documents (including UCC termination statements) to
effect a termination of the Security Interests and any document filed or
recorded to perfect such Security Interest.  Purchaser shall execute and deliver
and, if appropriate, file with the applicable filing offices, such documents and
instruments as may be necessary or desirable to effect such termination.  [***].

 

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IN WITNESS WHEREOF, the Parties have executed this Contract by their duly
authorized officers as of the date set forth in the Preamble.
 
 
 
 

 Space Systems/Loral, Inc.     Hughes Network Systems, LLC            By:  /s/
John Celli    By:  /s/ Adrian Morris            Name:   John Celli    Name:
 Adrian Morris            Title:   President and CEO    Title:   Executive Vice
President

 
 
 
                                                                                    
 
 
 
                                                                                                                                
 
 
 
                                                                          
 
 
 
                                                                                                                              
 
 

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restriction on the title page.
 
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