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Exhibit
10.34

 

CERTAIN
PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED AND FILED

SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION

PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE SYMBOL

"XXX" HAS BEEN INSERTED IN PLACE OF THE PORTIONS SO OMITTED.

 

Term Sheet for Restoration of
Services 

 

1.                             No moves.  Intelsat won’t move or offer alternative
capacity to any of its customers already transmitting or assigned to NSS-5
satellite (or the one Ku band transponder on NSS-6 being used by AFRTS)
(collectively, the “NSS Satellites”) as part of the IS-804 restoration.

 

2.                             Dust settles.  Attached hereto is a chart showing all of the
services for which Intelsat anticipates requiring capacity from NSS Satellites
as part of the IS-804 restoration (the “Initial Chart”).
The Initial Chart shows the following information: product, service order
number, December 2004 revenues, restoration status, preemptibility status,
transponder, frequency, bandwidth, beam, end of
service date, renewal rights and contractual backlog.  The Initial Chart shall be finalized by
Intelsat and provided by Intelsat to NSS no later than the close of business,
February 21, 2005, subject to the following limitations:  (i) the changes made shall not increase or
decrease by more than 5 % any of the following: (A) the amount of capacity
provided; (B) 2005 contracted revenues; or (C) backlog; and (ii) NSS is not
obligated to hold available any capacity that is not already identified as in
use on the Initial Chart; (iii) service contracts shown on the Initial Chart
shall not be adjusted; and (iv) Intelsat shall provide NSS with a list of
non-standard contractual rights that could affect backlog by March 21, 2005.    The finalized chart or, if no finalized
chart is submitted, the Initial Chart (then, in either case, the “Final Chart”)
shall then reflect the contractual commitment of Intelsat to take the specified
capacity, effective as of January 16, 2005.

 

3.                             No broader
agency, or resale right.  Terms are for restoration of 804 customers
only, exact requirements to be determined as above.

 

4.                             Revenue share.  XXX% to NSS, XXX% to Intelsat for revenues received by Intelsat for
services originally on the IS-804 and restored on the NSS Satellites, with the
following qualifications.

 

i.                                Revenue share
is based upon gross revenues paid to and collected by Intelsat (or an affiliate
of Intelsat) from its customers in consideration for the sale, lease, license
or any other form of distribution of space segment capacity or services including
with respect to any cancellation payments made
pursuant thereto.

 

ii.                             NSS gets imputed revenues
(based upon pre-existing end-user-customer contract rate) for the remainder of
the contract term (and any agreed renewals) in any of the following
circumstances:

 

A.                        Any agreement
by Intelsat to reduce existing contractual payment obligations or reduce
contract term.

 

B.                          Any failure or
delay of Intelsat to exercise contract remedies, including right of termination
for default for the period of such failure or delay.  In the event of termination for default,
Intelsat shall take all reasonable steps 

 

 

 

to pursue its end user
customer for their termination claim and, if so requested by NSS, shall assign
its claim against its end user customer to NSS.

 

C.                          The parties acknowledge that Intelsat’s carrier services contracts
provide customers with the right to manage and move carrier services within
their overall portfolio of services (“Porting”).  NSS shall receive imputed revenues for any such
Intelsat-contractually-permitted Porting; provided that, if NSS gets another
customer for an equivalent type of capacity on the satellite (of the same
connectivity), then it will offset 50% of the revenues received for such
capacity against Intelsat’s liability to NSS for such capacity up to the amount
of such liability.  Notwithstanding the
foregoing, there shall be no offset of Intelsat’s liability for any capacity
Ported within the Pacific Ocean Region (POR) defined herein as 123 degrees E.L.
to 243 degrees E.L. and Intelsat shall not induce customers to Port to other
capacity within the POR.  In no event
shall Intelsat be permitted to replace one customer for NSS’ capacity with
another customer, whether the original customer’s use of NSS’ capacity
terminated for reasons of Porting or otherwise.

 

D.                         If NSS
exercises its contract remedies vis-à-vis Intelsat under the agreement in
referred to in 4.v below.

 

iii.                              NSS shall not
be obligated to grant Intelsat outage credits. 
Intelsat may provide interruption credits to its customers.  To the extent that per its relevant  agreement, Intelsat grants credits it
shall be reflected in revenues subject to the revenue share.

 

iv.                       NSS shall have
audit rights consistent with the audit rights set out in the IS-603 revenue
sharing agreement.

 

v.                          Except where
expressly and unavoidably in conflict with term sheet specifics, Intelsat’s
lease of capacity from NSS will be on the terms of the service agreement
between Intelsat Global Sales & Marketing and NSS, dated April 30, 2004.

 

5.                             Renewals and
Expansion.

 

i.                                The XXX% to NSS/XXX% to
Intelsat revenue share continues to apply to any renewals.

 

ii.                             NSS will honor
existing renewal rights, to be specified in the service rights identified by
Intelsat in the Final Chart.

 

iii.                          Nonobligatory
renewals shall be offered to NSS; NSS choice whether to accept.

 

iv.                         If end-user
customer goes directly to NSS for renewal, NSS may agree, but revenue share
continues to apply.

 

v.                            Renewal rights
apply to contracts serving end-user-customer requirement in existing or
different form, but only to the existing amount of capacity provided. 

 

 

2

 

 

Each
party is free to offer end user customers additional capacity, new service
offerings, without sharing the revenue with the other party.

 

vi.                         In cases where
an end-user customer may wish to have greater capacity, either party may
provide, but to the extent that such greater capacity replaces the existing
capacity provided herein, the party providing the replacement is obligated to
the other party for that party’s portion of a revenue share.  If this occurs during the original
customer-contract period, that share shall be based upon the rate specified in
the original customer contract.  After
the original period the share shall be based proportionately in terms of the
capacity provided and the rent received therefore.  For example, if an end user customer is
taking 5 MHz of capacity for USD 10,000 per annum under an existing contract,
that rate continues to apply as imputed revenue during the customer contract term,
even if the customer is relocated to other capacity.  After the contracted term, if entered in lieu
of a renewal, the other party would be entitled to a revenue share portion, but
only as a percentage of the larger capacity deal.  So that if the same end user customer was
obligated to pay USD 15,000 per annum for 10 MHz of capacity, the revenue
subject to sharing would be USD 7,500 per annum.

 

6.                             NSS’ Capacity
Restoration.

 

i.                        In the event of
a “Substantial Failure” of any of NSS’ satellites NSS may, if it is interested
in obtaining restoration capacity from Intelsat for the services lost, notify
Intelsat within forty-eight (48) hours of the time that a determination is made
by NSS that such a failure has occurred (the “Failure Notice”), providing Intelsat
with a list of the technical requirements of the services it wishes Intelsat to
restore (the “NSS Services”), and provide Intelsat with a right of first
refusal to meet such technical requirements. 
Intelsat may agree or refuse to restore such services, in whole or in
part, at its discretion and will notify NSS of its decision within forty-eight
(48) hours of the Failure Notice.

 

ii.                                 If Intelsat agrees to
restore any NSS Services, it shall provide NSS with suitable restoration
capacity, in accordance with the technical parameters set out in the Failure
Notice.  If Intelsat restores any of the
services included in the Failure Notice to any of NSS’ customers (other than to
restore its Intelsat-804 customers in the event of an NSS-5 satellite failure
where NSS cannot otherwise provide restoration), whether by (A) contracting
with NSS, or (B) contracting with such customers directly, then the terms of
Sections 3, 4, and 5 of this term sheet shall apply to the provision of such
restoration capacity, mutatis mutandis, save that, as to such provision,
Intelsat shall be entitled to 80% of the collected revenues and NSS shall be
entitled to 20%.

 

iii.                              If within seven (7) days of Intelsat’s
reply to the Failure Notice, NSS regains control over the failed capacity on
its satellite, it may, by giving Intelsat written notice, remove the NSS
Services from Intelsat’s capacity and the revenue share shall cease to apply.  In such event, Intelsat agrees to work with
NSS in good faith to transition customers restored on Intelsat satellites back
to failed NSS’ capacity

 

 

3

 

 

iv.                             Except where expressly and
unavoidably in conflict with term sheet specifics, NSS’ lease of capacity from
Intelsat will be on the terms and conditions negotiated between Intelsat Global
Sales and Marketing Ltd. and NSS in the agreement dated January 21, 2005.

 

v.                              As used above, “Substantial
Failure” means the failure or degradation of 8 transponders or more such that
they cannot support applicable contracts. 
For the avoidance of doubt, the provisions of this Section 6 apply
Substantial Failure by Substantial Failure and are not limited to a single
event.

 

7.                                       Binding Term Sheet.  Once executed, this term sheet shall
constitute a binding agreement of the parties. 
The parties shall negotiate in good faith to conclude and execute
definitive documentation of the agreements reflected in this term sheet no
later than March 14, 2005, with each party using all reasonable efforts to
complete before that date; provided that the failure to agree upon such
documentation shall not void this term sheet, which shall then be implemented
by each party in good faith. This term sheet, definitive documentation, and all
leases made under this term sheet or the definitive documentation shall be
subject to English law.

 

IN WITNESS WHEREOF, each of the parties hereto has
duly executed and delivered this term sheet effective on February 17th, 2005.

 

 

	
  INTELSAT GLOBAL SALES & MARKETING LTD

  	
  NEW SKIES SATELLITES B.V.

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Andrew Stimson

  	
  By:

  	
  /s/ Daniel S. Goldberg

  
	
  Name:

  	
  Andrew Stimson

  	
  Name:

  	
  Daniel S. Goldberg

  
	
  Title:

  	
  Director

  	
  Title:

  	
  C.E.O.

  

 

 

 

4

 

  

 
 

Services Restored    
    

	Product Category
 
	 	SVO
 
	 	Dec 2004

Revenue
 
	 	Status
 
	 	Restoration

Time
 
	 	Satellite
 
	 	XPDR
 
	 	Cent

Freq
 
	 	Beam

(803)
 
	 	Assigned

Bandwidth
 
	 	Total

Backlog
 
	 	EOS
 
	 	Contr

Type
 
	 	Notes
 

	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	[REDACTED]	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

	Carrier & Channel Services	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	

1

QuickLinks

Services RestoredExhibit 10.35

 

 

 

CERTAIN PORTIONS OF THIS
EXHIBIT HAVE BEEN OMITTED AND FILED

SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE SYMBOL “XXX”
HAS BEEN INSERTED IN PLACE OF THE PORTIONS SO OMITTED.

 

 

AMENDMENT NUMBER 4

 

TO THE NSS-8 SPACECRAFT AND ASSOCIATED
EQUIPMENT AND SERVICES

CONTRACT (NSS-20-03-01)

 

BETWEEN

 

NEW SKIES SATELLITES B.V.

 

and

 

BOEING SATELLITE SYSTEMS INTERNATIONAL, INC.

 

 

This Amendment Number 4 to the
NSS-8 Spacecraft and Associated Equipment and Services Contract Number
NSS-20-03-01 dated and signed on 21 March 2001, as amended by Amendment Number
1 dated 15 January 2002, by Amendment Number 2 dated 12 February 2003, by
Amendment Number 3 dated 6 May 2003 and by a letter agreement dated 21 January
2004 (as so amended, hereinafter referred to as the “Original Contract”) is
made on this 22nd day of February, 2005 by and between:

 

NEW SKIES SATELLITES B.V.
(successor to New Skies Satellites N.V.), a Dutch corporation, with its principal
place of business located at Rooseveltplantsoen #4, 2517KR The Hague, The
Netherlands (hereinafter referred to as “NSS”); and

 

BOEING SATELLITE SYSTEMS
INTERNATIONAL, INC., a Delaware corporation, with its principal place of
business located at 2260 East Imperial Highway, El Segundo, CA, U.S.A.
(hereinafter referred to as “Contractor”).

 

 

WHEREAS:  NSS and Contractor have previously entered
into the Original Contract for provision of the NSS-8 communications satellite
and other items, and

 

WHEREAS:  NSS and Contractor entered into a Binding
Memorandum of Understanding dated 21 January 2005 (“MOU”) to modify certain
additional Original Contract Articles and Original Contract Exhibits, and

 

WHEREAS:  NSS and Contractor have agreed to substitute
for the Original Contract the attached Composite Compiled Satellite Contract
incorporating therein all previous amendments as well as the terms of the MOU,

 

NOW THEREFORE, in consideration
of the agreement between the Parties, the Parties agree as follows:

 

1.              The
Original Contract is amended, replaced and superseded in its entirety by the
Composite Compiled Satellite Contract attached hereto and the Exhibits to the
Original Contract are hereby amended as follows:

·        
Exhibit A, Spacecraft Performance
Specifications:  No Change

·        
Exhibit B, Statement of Work:  Amended and attached hereto

·        
Exhibit C, Product Assurance
Plan:  No Change

·        
Exhibit D, Test Plan:  Amended to include Annex 1, attached hereto

·        
Exhibit E, Milestone Payment
Plan:  Deleted and replaced in its
entirety with a new Exhibit E, Escrow Agreement, dated February 22, 2005 and
attached hereto

·        
Exhibit F, Criteria for
Conditional Acceptance:  Replaced in its
entirety with the revised Exhibit F, Method of Adjustment to Total Price, dated
February 2005 and attached hereto

·        
Exhibit G, Export Laws Compliance
Program:  No Change

·        
Exhibit H, Maximum Termination
Liability:  Deleted and replaced in its
entirety with a new Exhibit H, Agreement of Non-Possessory Pledge of Assets,
dated February 22, 2005 and attached hereto

·        
Exhibit I, Reserved:  Deleted and replaced in its entirety with a
new Exhibit I, Agreement of Undisclosed Pledge, dated February 22, 2005 and
attached hereto

 

2

 

·        
Exhibit J, Bill of Sale:  No Change

·        
Exhibit K, Certificate of
Performance:   Deleted

·        
Exhibit L, Launch Services Special
Terms:   No Change (except as may be made
pursuant to Paragraph 3 below)

·        
Exhibit M, XXX
Spacecraft Baseline Specifications: 
Deleted and replaced in its entirety with a new Exhibit M, Pending RDWs,
dated February 22, 2005 and attached hereto

 

For clarity and continuity, the Contract pages have been marked
“Amendment 4” and “February 2005” in the upper right hand corner.

 

                 2.              The Parties’
rights and obligations shall henceforth be governed by the Composite Compiled
Satellite Contract.  The Parties’
performance under the terms of the Composite Compiled Satellite Contract shall
fully satisfy and discharge their respective rights, claims and obligations
under the Original Contract relating to the anticipated delay in NSS-8's
delivery, and all legal and equitable rights, obligations and claims arising or
existing prior to the date of execution of this Amendment Number 4 shall be
relinquished and discharged, as follows: 
(i) XXX and (ii) upon the
occurrence of (i), Contractor shall be deemed to have relinquished any claims
by Contractor that XXX (as set
forth in the Composite Compiled Satellite Contract) or any other terms of the
Original Contract or of the Composite Compiled Satellite Contract have been
modified by any waiver, agreement or otherwise prior to the date of this
Amendment Number 4 (unless otherwise specified in Paragraph 3 below).  Unless and until the events described in (i)
and (ii) occur, the

 

3

 

rights, claims and obligations of the Parties shall be as currently
specified in the Original Contract.

 

                 3.              The Parties shall
use reasonable commercial efforts to conclude the following additional matters
within the thirty (30) days following the execution date of this Amendment to
do the following:

 

a.     To
update Exhibit D, Test Plan, to incorporate the items included in Annex 1
thereto;

b.     To
review and, as appropriate in light of the amended terms regarding Launch in
the Composite Compiled Satellite Contract, delete or integrate into the
Composite Compiled Satellite Contract the terms and conditions currently set
forth in Exhibit L, Launch Services Special Terms.

c.     To resolve the Parties' dispute regarding whether
the Warranty for the Spacecraft as set forth in Article 15 of the Original
Contract shall apply to the Spacecraft until Acceptance, until Launch, or until
Acceptance but under conditions that limit or alter the post-Launch application
of the Warranty, in each case in light of the terms and intent of the Original
Contract and the MOU. In executing the composite Compiled Satellite Contract,
Contractor expressly disputes the inclusion of a post-Launch warranty for the
Spacecraft, and Contractor's execution of the Composite Compiled Satellite
Contract shall not be deemed a waiver of Contractor's rights or remedies under
the Original Contract or the MOU to claim that, in light of the terms and
intent of the MOU or otherwise, the warranty for the Spacecraft shall not apply
following Launch.

 

                 4.              This Amendment
Number 4 may be signed in separate counterparts, each of which, together, will
constitute one agreement between the Parties.

 

4

 

IN WITNESS WHEREOF, this
Amendment Number 4 has been duly executed by the Parties on the date stated
above.

 

	
  NEW SKIES SATELLITES B.V.

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Daniel
  Goldberg

  	
   

  	
   

  
	
   

  	
  (signed)

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Daniel
  Goldberg

  	
   

  	
   

  
	
   

  	
  (printed)

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
  CEO

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  NEW SKIES SATELLITES B.V.

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
   

  	
  (signed)

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  (printed)

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  BOEING SATELLITE SYSTEMS INTERNATIONAL, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Dennis
  Beeson

  	
   

  	
   

  
	
   

  	
  (signed)

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Dennis
  Beeson

  	
   

  	
   

  
	
   

  	
  (printed)

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
  Manager

  	
   

  	
   

  

 

5

 

 

 

 

COMPOSITE
COMPILED SATELLITE CONTRACT

 

 

between

 

 

NEW SKIES
SATELLITES B.V.

Rooseveltplantsoen
# 4

2517KR The
Hague

The
Netherlands

 

 

and

 

 

BOEING
SATELLITE SYSTEMS INTERNATIONAL, INC.

2260 East
Imperial Highway

El Segundo,
CA

U.S.A.

 

 

for

 

 

NSS-8
Spacecraft

and
Associated Equipment and Services

 

 

Contract
No.  NSS-20-03-01

 

 

Date:  March 21, 2001

 

 

TABLE OF
CONTENTS

 

	
  ARTICLE 1.
  DEFINITIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 2.
  SCOPE OF WORK/ORDER OF PRECEDENCE

  	
   

  
	
  A.

  	
  Scope
  of Work

  	
   

  
	
  B.

  	
  Order of Precedence

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3.
  ITEMS TO BE DELIVERED AND DELIVERY SCHEDULE

  	
   

  
	
  A.

  	
  Items/Promised Delivery Dates

  	
   

  
	
  B.

  	
  Time
  of Essence

  	
   

  
	
  C.

  	
  Contractor Responsibility

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 4. PRICES

  	
   

  
	
  A.

  	
  Total
  Price

  	
   

  
	
  B.

  	
  Taxes

  	
   

  
	
  C.

  	
  Adjustments

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 5.
  METHOD OF PAYMENT

  	
   

  
	
  A.

  	
  Milestone Payment Refund

  	
   

  
	
  B.

  	
  Escrow

  	
   

  
	
  C.

  	
  Payment of Total Price

  	
   

  
	
  D.

  	
  Interest

  	
   

  
	
  E.

  	
  Disputed Payments

  	
   

  
	
  F.

  	
  Currency/Place of Payment

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 6.
  DELIVERY, TITLE AND RISK OF LOSS OR DAMAGE

  	
   

  
	
  A.

  	
  Spacecraft Delivery

  	
   

  
	
  B.

  	
  Delivery of Other Items

  	
   

  
	
  C.

  	
  Title

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 7.
  CERTIFICATION, INSPECTION, ACCEPTANCE, WAIVERS

  	
   

  
	
  A.

  	
  General Requirements

  	
   

  
	
  B.

  	
  Waivers

  	
   

  
	
  C.

  	
  Inspections

  	
   

  
	
  D.

  	
  Spacecraft
  Acceptance Procedure

  	
   

  
	
  E.

  	
  Acceptance
  Procedures for Other Items

  	
   

  
	
  F.

  	
  Remedy of Defects

  	
   

  
	
  G.

  	
  Post Acceptance Remedies

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 8.
  LAUNCH SERVICES PROCUREMENT

  	
   

  

 

i

 

	
  ARTICLE 9.
  INSURANCE

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 10.
  SUBCONTRACTS

  	
   

  
	
  A.

  	
  Subcontracts

  	
   

  
	
  B.

  	
  Key Subcontracts

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 11.
  PROPERTY ACCOUNTING

  	
   

  
	
  A.

  	
  Identification and
  Control

  	
   

  
	
  B.

  	
  Subcontractors

  	
   

  
	
  C.

  	
  Inventory

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 12.
  CHANGES REQUESTED BY CONTRACTOR OR NSS

  	
   

  
	
  A.

  	
  Contract Change Notice

  	
   

  
	
  B.

  	
  Acceptance of Change

  	
   

  
	
  C.

  	
  Non
  Refusal

  	
   

  
	
  D.

  	
  Price of Changes

  	
   

  
	
  E.

  	
  Compressed Time Periods

  	
   

  
	
  F.

  	
  Changes To Meet
  Specifications

  	
   

  
	
  G.

  	
  Pending RDWs

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 13.
  CONTRACT TECHNOLOGY

  	
   

  
	
  A.

  	
  Disclosure of
  Contract Technology

  	
   

  
	
  B.

  	
  Rights Granted
  in Contract Technology

  	
   

  
	
  C.

  	
  Limitations

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 14.
  RIGHT OF ACCESS, REPORTS, TESTING, MONITORING

  	
   

  
	
  A.

  	
  Access

  	
   

  
	
  B.

  	
  Reports

  	
   

  
	
  C.

  	
  Performance Testing

  	
   

  
	
  D.

  	
  Monitoring

  	
   

  
	
  E.

  	
  Export Laws Compliance

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 15. WARRANTY

  	
   

  
	
  A.

  	
  Warranty

  	
   

  
	
  B.

  	
  Remedies

  	
   

  
	
  C.

  	
  Warranty Period

  	
   

  
	
  D.

  	
  Disclaimer

  	
   

  
	
  E.

  	
  Not Exclusive Rights

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 16.
  DEFICIENCIES NOTED IN OTHER SPACECRAFT

  	
   

  
	
  A.

  	
  Qualification Heritage

  	
   

  
	
  B.

  	
  Notice

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 17.
  TERMINATION FOR CONVENIENCE

  	
   

  
	
  A.

  	
  Termination

  	
   

  

 

ii

 

	
  B.

  	
  Termination Expense

  	
   

  
	
  C.

  	
  Termination Charges

  	
   

  
	
  D.

  	
  Subcontractor Settlements

  	
   

  
	
  E.

  	
  Inventory

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 18.
  TERMINATION FOR OTHER REASONS

  	
   

  
	
  A.

  	
  Termination by NSS for
  Cause

  	
   

  
	
  B.

  	
  Improper Termination

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 19. SECURITY

  	
   

  
	
  A.

  	
  Grant of Security
  Interest

  	
   

  
	
  B.

  	
  Representations
  and Warranties; Covenants

  	
   

  
	
  C.

  	
  Events of Default; Cure

  	
   

  
	
  D.

  	
  Contractor’s
  Remedies Following an Event of Default

  	
   

  
	
  E.

  	
  Termination
  of Security Interest and Substitution of Collateral

  	
   

  
	
  F.

  	
  Taxes

  	
   

  
	
  G.

  	
  Remedies Cumulative

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 20. KEY
  PERSONNEL

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 21. DISPUTES

  	
   

  
	
  A.

  	
  Disputes

  	
   

  
	
  B.

  	
  Disagreements
  Regarding Technical Matters

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 22.
  INDEMNIFICATION

  	
   

  
	
  A.

  	
  General Indemnification

  	
   

  
	
  B.

  	
  Intellectual
  Property Indemnification

  	
   

  
	
  C.

  	
  Indemnification for Taxes

  	
   

  
	
  D.

  	
  Procedures

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 23.
  LIMITATION OF LIABILITY

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 24.
  DAMAGE TO PERSONS OR PROPERTY, ASSOCIATED WITH LAUNCH, INTERPARTY WAIVER

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 25.
  REPRESENTATIONS AND WARRANTIES

  	
   

  
	
  A.

  	
  Mutual
  Representations and Warranties

  	
   

  
	
  B.

  	
  Contractor’s
  Special Representations and Warranties

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 26. ASSIGNMENT

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 27.
  CONFIDENTIALITY

  	
   

  
	
  A.

  	
  Identification
  of Proprietary Information

  	
   

  
	
  B.

  	
  Restrictions on Use,
  Disclosure

  	
   

  

 

iii

 

	
  C.

  	
  Company Restricted
  Information

  	
   

  
	
  D.

  	
  Standard of Care

  	
   

  
	
  E.

  	
  Property of Disclosing
  Party

  	
   

  
	
  F.

  	
  Confidential
  Treatment of MOU Terms

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 28.
  PUBLIC RELEASE OF INFORMATION

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 29.
  NOTICES AND REPORTS, AUTHORIZED REPRESENTATIVES

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 30. OPTIONS

  	
   

  
	
  A.

  	
  Technical Support

  	
   

  
	
  B.

  	
  Replacement Spacecraft

  	
   

  
	
  C.

  	
  Optional Storage And
  Retest

  	
   

  
	
  D.

  	
  Intentionally Omitted

  	
   

  
	
  E.

  	
  In-Orbit Test Location

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 31.
  NSS FURNISHED INFORMATION AND PROPERTY

  	
   

  
	
  A.

  	
  Title

  	
   

  
	
  B.

  	
  Risk of Loss

  	
   

  
	
  C.

  	
  Use

  	
   

  
	
  D.

  	
  Taxes

  	
   

  
	
  E.

  	
  Encumbrances

  	
   

  
	
  F.

  	
  Return

  	
   

  
	
  G.

  	
  Damages

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 32.
  HAZARDOUS MATERIAL IDENTIFICATION AND MATERIAL SAFETY DATA

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 33.
  APPLICABLE LAWS

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 34. RESERVED

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 35. RESERVED

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 36. GENERAL

  	
   

  
	
  A.

  	
  Severability

  	
   

  
	
  B.

  	
  Cumulative Rights/Waivers

  	
   

  
	
  C.

  	
  Gender/Captions

  	
   

  
	
  D.

  	
  Relationship of the
  Parties

  	
   

  
	
  E.

  	
  Construction

  	
   

  
	
  F.

  	
  Including/Time

  	
   

  
	
  G.

  	
  Survival

  	
   

  
	
  H.

  	
  Entire Agreement

  	
   

  

 

iv

 

	
  Exhibit A

  	
  -

  	
  Spacecraft Performance Specifications (Rev B., dated January 2003)

  
	
   

  	
   

  	
   

  
	
  Exhibit B

  	
  -

  	
  Statement of Work (Rev B., dated February 2005)

  
	
   

  	
   

  	
   

  
	
  Exhibit C

  	
  -

  	
  Product Assurance Plan (dated March 2001)

  
	
   

  	
   

  	
   

  
	
  Exhibit D

  	
  -

  	
  Test Plan (Rev B, dated February 2005) (including Annex 1
  thereto)

  
	
   

  	
   

  	
   

  
	
  Exhibit E

  	
  -

  	
  Escrow Agreement (dated February 21, 2005)

  
	
   

  	
   

  	
   

  
	
  Exhibit F

  	
  -

  	
  Method of Adjustment to Total Price (Rev B dated February 2005)

  
	
   

  	
   

  	
   

  
	
  Exhibit G

  	
  -

  	
  Export Laws Compliance Program

  
	
   

  	
   

  	
   

  
	
  Exhibit H

  	
  -

  	
  Agreement of Non-Possessory Pledge of Assets (NSS-8) (dated February 22,
  2005)

  
	
   

  	
   

  	
   

  
	
  Exhibit I

  	
  -

  	
  Agreement of Undisclosed Pledge (NSS-8 Customer Accounts Receivable)
  (dated February 22, 2005)

  
	
   

  	
   

  	
   

  
	
  Exhibit J

  	
  -

  	
  Bill of Sale

  
	
   

  	
   

  	
   

  
	
  Exhibit K

  	
  -

  	
  Intentionally Omitted

  
	
   

  	
   

  	
   

  
	
  Exhibit L

  	
  -

  	
  Launch Services Special Terms

  
	
   

  	
   

  	
   

  
	
  Exhibit M

  	
  -

  	
  Pending RDWs (dated February 2005)

  

 

v

 

COMPOSITE
COMPILED CONTRACT FOR NSS-8 SPACECRAFT

 

AND
ASSOCIATED EQUIPMENT AND SERVICES

 

THIS COMPOSITE COMPILED CONTRACT (the “Contract”),
entered into as of this 22nd day of February, 2005, by and between Boeing
Satellite Systems International, Inc., a Delaware corporation, with its
principal place of business located at 2260 East Imperial Highway, El Segundo,
CA, U.S.A., (“Contractor”), and New Skies Satellites B.V., a Dutch corporation,
with its principal place of business located at Rooseveltplantsoen # 4, 2517KR
The Hague, The Netherlands (“NSS”), supersedes and replaces the Contract for
NSS-8 Spacecraft and Associated Equipment and Services between Contractor and
New Skies Satellites N.V. (predecessor of NSS) dated 21 March 2001, as
amended by Amendment Number 1 dated 15 January 2002, by Amendment Number 2
dated 12 February 2003, by Amendment Number 3 dated 6 May 2003 and by a
letter agreement dated 21 January 2004 (as so amended, hereinafter
referred to as “the Original Contract”).

 

W I T N E S
S E T H T H A T:

 

The Parties hereto mutually agree as follows:

 

ARTICLE 1.  DEFINITIONS

 

As used in this Contract:

 

A.            “Acceptance” with respect to any Item other
than the Spacecraft shall be as defined in Paragraph 7.E.  “Acceptance”
with respect to the Spacecraft shall be as defined in Paragraph 7.D.

 

B.            “Accounts Receivable” shall have the
meaning provided in the Receivables Pledge Agreement.

 

C.            “Alternative Launch Services Provider”
means either Arianespace, Boeing Delta Launch Services or International Launch
Services, which may be selected by Contractor pursuant to Article 8 to
Launch the Spacecraft.

 

 

D.            “Alternative Launch Vehicle” means either
the Ariane 5, the Atlas V, the Delta IV or the Proton/Breeze M launch vehicle,
which may be procured and provided by Contractor pursuant to Article 8.

 

E.             “Authorized Representative” shall have the
meaning set forth in Article 29.

 

F.             “Business Day” means any day that that is
not a Saturday or a Sunday or any other day on which commercial banks in New
York City, California, Illinois or The Netherlands are authorized or required
by law to remain closed.

 

G.            “Company Restricted Information” shall have
the meaning set forth in Paragraph 27.A.

 

H.            “Contract” shall have the meaning set forth
in the preamble.

 

I.              “Contract Change Notice” means a notice
proposing a change in any requirement of this Contract as described in the
Statement of Work and in accordance with Article 12.

 

J.             “Contract Data” means all Information,
including Deliverable Data, generated, developed, utilized, referenced, and/or
referred to in the performance of Work and/or relating to any Items.

 

K.            “Contract Intellectual Property” means all
Patents, U.S. and foreign patent applications and patent disclosures; all
patentable or unpatentable inventions, discoveries, improvements, and
innovations; all U.S. and foreign trademarks, trademark applications, and all
registrations and recordings thereof; all U.S. and foreign service marks,
service mark applications, and all registrations and recordings thereof; trade
names; all U.S. and foreign copyrights, copyright registrations, and
applications to register copyrights; confidential or proprietary technical and
business information and trade secrets; know-how; show-how; licenses (including
in the form of an immunity from suit) to use the intellectual property of third
parties (to the extent that the licensee can sublicense); software; technical
manuals and documentation used in connection with the foregoing; and other
intellectual property and proprietary information generated, developed,
utilized, referenced, and/or referred to in the performance of Work and/or
relating to any Items.

 

2

 

L.            “Contract Technology” means any and all
Contract Data and Contract Intellectual Property.

 

M.           “Contracted Orbital Maneuver Life” means an
Orbital Maneuver Life as set forth in Section 1.1.5 of the Spacecraft
Performance Specifications.

 

N.            “Contractor” shall have the meaning set
forth in the preamble.

 

O.            “Customer Contract” shall have the meaning
provided in the Receivables Pledge Agreement.

 

P.            “Customer Contract Coverage Maintenance”
shall have the meaning set forth in Paragraph 19.B.3(a).

 

Q.            “Deliverable Data” means all Information
required to be delivered to NSS under this Contract, including data and
information contained in reports, documents, computer programs, drawings and
graphs.

 

R.            “Deliverable Hardware” means all property
other than Deliverable Data required to be delivered to NSS under this
Contract, including Spacecraft, equipment, models, devices and the tangible
media on which Deliverable Data is delivered.

 

S.            “Delivery” for Items other than the
Spacecraft shall occur upon Acceptance as confirmed in writing by NSS as
described in Paragraph 6.B.  “Delivery” for the Spacecraft shall be as
described in Paragraph 6.A.

 

T.            “Disbursement Request” shall have the
meaning set forth in the Escrow Agreement.

 

U.            “Effective Date of Contract” or “EDC” means
21 March 2001.

 

V.            “Escrow Account” shall have the meaning
set forth in the Escrow Agreement.

 

W.           “Escrow Agent” means LaSalle Bank National
Association.

 

X.            “Escrow Agreement” means the escrow
agreement among Contractor, NSS and LaSalle Bank National Association attached
hereto as Exhibit E.

 

Y.            “Escrow Amount” shall have the meaning set
forth in Paragraph 5.A.

 

3

 

Z.            “Event of Default” shall have the meaning
set forth in Paragraph 19.C.1.

 

AA.         “Excluded Judgments” means any judgments
(i) which are not final, (ii) which are covered by insurance, (iii) which
have been discharged or stayed or (iv) which aggregate less than
$20,000,000.

 

BB.         “Export Laws” shall have the meaning set
forth in Paragraph 3.C.

 

CC.         “Export Laws Compliance Program” means the
program described in Exhibit G that Contractor will implement to ensure that
Contractor obtains all governmental authorizations and approvals necessary to
permit NSS to have access to all Work, facilities, data, information,
documentation, books, records, testing and test results, and to take Delivery of
all Items, as required by this Contract.

 

DD.         “Failure” shall have the meaning set forth
in Exhibit F.

 

EE.          “Governmental Authority” means any
federal, state, local or foreign court or governmental agency, authority,
instrumentality or regulatory or legislative body.

 

FF.          “Information” means all data and
information, including data and information of a technical, business or
financial nature which has been documented on any tangible media, Including
writings, drawings, sound recordings, computer programs, pictorial
representations and graphs.

 

GG.         “In Service Date” means the date of
Acceptance of the Spacecraft.

 

HH.         “Intentional Ignition” means, with respect
to the Spacecraft, the time in the ignition process for the purpose of Launch
that coincides with the opening of the fuel valve to gas generator, occurring
at approximately L-3.4 seconds (i.e., 3.4 seconds
prior to intended Launch), for ignition of the Launch Vehicle first stage main
engine. Intentional Ignition is not deemed to have occurred in the event of a
Terminated Ignition.

 

II.            “IOT” means in-orbit tests as specified in
the Test Plan, including Annex A thereto.

 

JJ.          “Items” means any and all Deliverable
Hardware and Deliverable Data.

 

KK.         “Key Subcontract” shall have the meaning
set forth in Paragraph 10.B.

 

4

 

LL.          “Key Subcontractor(s)” shall have the
meaning sot forth in Paragraph 10.B.

 

MM.        “Launch” means, with respect to the
Spacecraft, Intentional Ignition of the first stage engine of the Launch
Vehicle followed by either: 1.) release of the hold-down restraints and
breaking of the break wire indicating that the Launch Vehicle has left the
launch pad, or 2.) the subsequent intentional or unintentional destruction
of the Launch Vehicle after release of the hold down restraints, but prior to
the break wire breaking. A Launch is deemed not to have occurred in the event
of a Terminated Ignition.

 

NN.         “Launch Services Provider” means Sea
Launch, an Alternative Launch Services Provider selected by Contractor in
accordance with Article 8, or another launch services provider selected by
Contractor and approved by NSS in accordance with Article 8, which will
Launch the Spacecraft.

 

OO.        “Launch Services” means those services to
be provided by the Launch Services Provider pursuant to the Launch Services
Agreement.

 

PP.          “Launch Services Agreement” means the
agreement between Contractor and the Launch Services Provider as described in Article 8.

 

QQ.        “Launch Site” means the location from which
the Launch of the Spacecraft will occur, as specified in the Launch Services
Agreement.

 

RR.         “Launch Vehicle” means the Sea Launch
launch vehicle, an Alternative Launch Vehicle or another launch vehicle
approved by NSS, which launch vehicle will be procured and provided by
Contractor pursuant to Article 8.

 

SS.          “License to Practice” means a right to
disclose, make, use, lease, offer for sale, market, advertise, promote, sell,
dispose of and otherwise practice.

 

TT.          “Liens” shall have the meaning set forth in
Paragraph 19.B.2(d).

 

UU.          “Lock-Box Account” shall have the meaning
set forth in Paragraph 19.B.3(a).

 

VV.         “Material Adverse Effect” means the
existence of events or conditions that have had or are reasonably likely to
have a material adverse effect on (i) the validity or enforceability of, or of
the material rights, remedies or benefits (including the aggregate

 

5

 

value to Contractor of the
collateral secured by the Pledge Agreements) available to Contractor under Article 19
or the Pledge Agreements or (ii) the ability of NSS to perform and comply with
its material obligations under Article 19 or the Pledge Agreements in
accordance with their terms (including, where applicable, the timetable within
which such performance or compliance is required), in each case taking into
consideration the amount of the Remaining Payments.

 

WW.      “MOU” means that certain Binding
Memorandum of Understanding Regarding the NSS-8 Spacecraft and Associated
Equipment and Services Contract (NSS-20-03-01) between NSS and Contractor dated
January 21, 2005.

 

XX.         “Nominal Launch Plan” shall have the
meaning set forth in Article 8.

 

YY.          “NPV Discount Rate” means the London
Interbank Offered Rate (London Quote) for three (3) months plus XXX percent XXX per annum net present value interest factor.

 

ZZ.          “NSS” shall have the meaning set forth in
the preamble.

 

AAA.      “NSS Credit Agreement” means the Credit
Agreement, dated as of November 2, 2004, among New Skies Holding B.V.,
NSS, the subsidiary revolving borrowers from time to time party thereto, the
lenders from time to time party thereto, Deutsche Bank AG, New York Branch, as
administrative agent, ABN Amro Bank N.V., as syndication agent, Deutsche Bank
Securities Inc. and ABN Amro Incorporated, as joint lead arrangers and joint
book running managers and BNP Paribas SA and ING Bank N.V., as co-documentation
agents, as the same may be amended, supplemented or otherwise modified from
time to time.

 

BBB.      “NSS Credit Agreement Acceleration” shall
have the meaning set forth in Paragraph 19.B.3.b.

 

CCC.      “NSS Credit Agreement Amendment” means the
First Amendment, dated as of February 22, 2004, to the NSS Credit
Agreement.

 

DDD.      “NSS-8 Customer” shall have the meaning
provided in the Receivables Pledge Agreement.

 

EEE.        “Orbital Design Life” means the orbital
design life of the Spacecraft as specified in Section 1.1.4. of the
Spacecraft Performance Specifications.

 

6

 

FFF.        “Orbital Maneuver Life” means the period of
time following the In Service Date for which the Spacecraft has sufficient fuel
to be operated at the Orbital Station, in accordance with stationkeeping
requirements set forth in the Spacecraft Performance Specifications, and
allowing sufficient fuel to deorbit the Spacecraft at the end of its life, also
in accordance with the standards set forth in the Spacecraft Performance
Specifications.

 

GGG.      “Orbital Station” means the orbital
location at which the Spacecraft is to be placed in geosynchronous orbit for
Delivery to be specified by NSS pursuant to the Statement of Work.

 

HHH.      “Original Contract” shall have the meaning
set forth in the preamble.

 

III.           “Patent” means a U.S. or foreign patent for
an invention or a similar form of statutory protection such as a utility model
or registered design.

 

JJJ.        “Party” or “Parties” means NSS and/or Contractor, who are the principals
to this Contract.

 

KKK.      “Payment Default” shall have the meaning
set forth in Paragraph 19.B.3(a).

 

LLL.       “Payment Start Date” means the date that
is five (5) days before the In Service Date.

 

MMM.    “Permitted Liens” means any future (i)
Liens that are subordinated to Contractor’s interests under the Pledge
Agreements on terms that are reasonably satisfactory to Contractor (taking into
consideration the amount of the Remaining Payments), including reasonably
satisfactory inter-creditor arrangements between Contractor and the holder of
such other Lien, (ii) Liens arising by operation of law, (iii) Liens for taxes,
assessments, governmental charges or levies not yet delinquent or that are
being contested in good faith, provided that NSS will give Contractor notice of
any such Lien of which it has knowledge and which secures the payment of taxes
or charges in excess of $20 million, (iv) Liens securing judgments which are
not Excluded Judgments, provided that NSS will give Contractor notice of any
such Lien of which it has knowledge and which secures any judgment which is not
an Excluded Judgment in excess of $10 million, (v) other than with respect to
sale-leaseback transactions, interest of a lessor or lessee under any leases,
subleases, service agreements or other capacity

 

7

 

agreements entered into in the
ordinary course of business of NSS and (vi) Liens which would not reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect.

 

NNN.      “Permitted Receivables Disposals” means
(i) any compromise, settlement, discount, waiver, extension of payment or other
disposition of Accounts Receivable in the ordinary course of business and in a
manner consistent with NSS’s general business practices, (ii) any compromise,
settlement, discount, waiver, extension of payment or other disposition of
Accounts Receivable which would not reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect, and (iii)
disposals which are consented to by Contractor, which consent shall not be
unreasonably withheld, conditioned or delayed if NSS provides alternative
collateral acceptable to Contractor in its reasonable discretion (taking into
consideration the amount of the Remaining Payments).

 

OOO.     “Permitted Spacecraft
Disposals” means
(i) any sale, lease, sublease, license, assignment or other disposal
(other than a disposal constituting a beschikking under
Dutch law) of transponder capacity of the Spacecraft (other than as part of a
sale-leaseback transaction) in the ordinary course of business, (ii) so
long as not resulting in a Lien which is not a Permitted Lien, sale-leaseback
transaction(s) or any other disposals (including disposals constituting a beschikking under Dutch law) with respect to a portion of
the Spacecraft, any transponder capacity of the Spacecraft or any payload for
the Spacecraft in the ordinary course of business, (iii) sales, leases,
subleases, licenses, assignments or other disposals of the Spacecraft (in one
or a series of related transactions) or any payload for the Spacecraft, so long
as, contemporaneously with such disposal, NSS makes a Prepayment under
Paragraph 5.C.3 of all future payments owing to Contractor pursuant to
this Contract, and (iv) sales, leases, subleases, licenses or other
disposals which are consented to by Contractor, which consent shall not be
unreasonably withheld, conditioned or delayed if NSS provides alternative
collateral acceptable to Contractor in its reasonable discretion (taking into
consideration the amount of the Remaining Payments).

 

PPP.       “Pledge Agreements” means the Receivables
Pledge Agreement and the Spacecraft Pledge Agreement.

 

QQQ.     “Prepayments” shall have the meaning set
forth in Paragraph 5.D.

 

8

 

RRR.      “Price Adjustment” shall have the meaning
set forth in Paragraph 4.C.

 

SSS.       “PROCS” shall have the meaning set forth in
Paragraph 19.D.2(b).

 

TTT.       “Product Assurance Plan” means the product
assurance plan attached hereto as Exhibit C.

 

UUU.       “Promised Delivery Date” means the date
promised for Delivery of an applicable Item pursuant to Article 3.

 

VVV.      “Proprietary Information” shall have the
meaning set forth in Paragraph 27.A.

 

WWW.  “Receivables Pledge Agreement” means the
Agreement of Undisclosed Pledge to be executed by NSS and Contractor on the
date of this Contract, substantially in the form attached hereto as Exhibit H.

 

XXX.      “Remaining Payments” means the incentive
payments and interest remaining to be paid to Contractor under Paragraphs 5.C
and 5.D of this Contract through the term of the Contract.

 

YYY.       “Replacement Spacecraft” means the
replacement spacecraft that Contractor is obligated to deliver to NSS, if the
Spacecraft fails after Intentional Ignition and before Delivery and if NSS
exercises its option for such replacement spacecraft pursuant to Paragraph
30.B.

 

ZZZ.       “Right to Publish” means a right to make public
through any means and media whatsoever.

 

AAAA.   “Right to Use”
means a right to disclose, copy, duplicate, reproduce, modify and otherwise
use.

 

BBBB.   “Services”
means all services and labor required to be provided or arranged for under this
Contract by Contractor, including studies, development, research, design,
analysis, manufacture, product assurance, product integration, transportation,
launch and testing.

 

CCCC.   “Spacecraft”
means the satellite to be constructed by Contractor and launched and delivered
to NSS.

 

9

 

DDDD.   “Spacecraft
Performance Specifications” means the performance specifications
attached hereto as Exhibit A.

 

EEEE.      “Spacecraft
Pledge Agreement” means the Agreement of Non-Possessory Pledge of
Assets to be executed by NSS and Contractor on the date of this Contract,
substantially in the form attached here to as Exhibit I.

 

FFFF.      “Statement
of Work” means the statement of work attached hereto as Exhibit B.

 

GGGG.   “Subcontract”
means a subcontract including purchase orders, memoranda of understanding and
all similar forms of agreement at any tier under this Contract.

 

HHHH.   “Subcontractor”
means a contractor under any Subcontract.

 

IIII.          “Terminated
Ignition” means when, following Intentional Ignition, the first
stage engine of the Launch Vehicle has been shut down for any reason before
release of the hold down restraints and after Sea Launch officially declares
the launch platform safe.

 

JJJJ.      “Test Plan”
means the on-ground and in-orbit test plan attached hereto as Exhibit D.

 

KKKK.   “The Spacecraft Absolute
Latest STOP” means, with
respect to the Spacecraft, the moment in time in the Launch sequence, meaning
L-60 seconds (i.e., 60 seconds prior to intended Launch), when the
Spacecraft mission manager (SMM) can no longer effect an abort to the Launch.

 

LLLL.    “Total Loss”
shall have the meaning set forth in Exhibit F.

 

MMMM.  “Total
Price” shall have the meaning set forth in Paragraph 4.A.

 

NNNN.   “Total
Verified Termination Expense” shall have the meaning set forth in
Paragraph 17.B.

 

OOOO.  “TTC&M”
shall have the meaning set forth in Paragraph 19.D.2(b).

 

PPPP.    “Work”
means the production and Delivery of all Items and the provision of all
Services under this Contract by Contractor.

 

10

 

ARTICLE 2.  SCOPE OF WORK/ORDER OF PRECEDENCE

 

A.                                    Scope of Work

 

Contractor (i) shall provide the necessary
personnel, material, equipment, services and facilities to perform the Work
specified under the provisions of this Contract, including the Exhibits listed
below, (ii) shall perform such work and (iii) shall deliver to NSS those Items
listed under Article 3, in accordance with the Promised Delivery Dates
specified therein.  The Exhibits to this
Contract, which are attached hereto and hereby made a part of this Contract,
are as follows:

 

	
  Exhibit A

  	
  -

  	
  Spacecraft Performance Specifications

  
	
  Exhibit B

  	
  -

  	
  Statement of Work

  
	
  Exhibit C

  	
  -

  	
  Product Assurance Plan

  
	
  Exhibit D

  	
  -

  	
  Test Plan

  
	
  Exhibit E

  	
  -

  	
  Escrow Agreement

  
	
  Exhibit F

  	
  -

  	
  Method of Adjustment to Total Price

  
	
  Exhibit G

  	
  -

  	
  Export Laws Compliance Program

  
	
  Exhibit H

  	
  -

  	
  Agreement of Non-Possessory Pledge of Assets

  
	
  Exhibit I

  	
  -

  	
  Agreement of Undisclosed Pledge

  
	
  Exhibit J

  	
  -

  	
  Bill of Sale

  
	
  Exhibit K

  	
  -

  	
  Intentionally Omitted

  
	
  Exhibit L

  	
  -

  	
  Launch Services Special Terms

  
	
  Exhibit M

  	
  -

  	
  Pending RDWs

  

 

B.                                    Order of Precedence

 

In the event of conflict among the terms of this
Contract and the Exhibits, or in the event of conflicts among the terms of the
Exhibits, the following order of decreasing precedence shall apply:

 

	
  •      This Contract (Preamble and Articles 1
  through 36)

  
	
  •      Exhibit M

  	
   

  	
  Pending RDWs

  
	
  •      Exhibit B

  	
   

  	
  Statement of Work

  
	
  •      Exhibit A

  	
   

  	
  Spacecraft Performance Specifications

  
	
  •      Exhibit E

  	
   

  	
  Escrow Agreement

  
	
  •      Exhibit F

  	
   

  	
  Method of Adjustment to Total Price

  

 

11

 

	
  •      Exhibit H

  	
   

  	
  Agreement of Non-Possessory Pledge of Assets

  
	
  •      Exhibit I

  	
   

  	
  Agreement of Undisclosed Pledge

  
	
  •      Exhibit C

  	
   

  	
  Product Assurance Plan

  
	
  •      Exhibit D

  	
   

  	
  Test Plan

  
	
  •      Exhibit L

  	
   

  	
  Launch Services Special Terms

  
	
  •      Exhibit G

  	
   

  	
  Export Laws Compliance Program

  
	
  •      Exhibit J

  	
   

  	
  Bill of Sale

  

 

ARTICLE 3.  ITEMS TO BE DELIVERED AND DELIVERY SCHEDULE

 

A.                                    Items/Promised Delivery Dates

 

All Items and Services to be delivered and the
corresponding Promised Delivery Dates and points of Delivery are set forth
below:

 

	
  Item No.

  	
   

  	
  Quantity

  	
   

  	
  Description

  	
   

  	
  Promised

  Delivery Date

  	
   

  	
  Point of

  Delivery

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  1

  	
   

  	
  Spacecraft as specified in Exhibit A and Exhibit B

  	
   

  	
  XXX

  	
   

  	
  Orbital Station

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  1 lot

  	
   

  	
  All Software Models, Databases, Analysis Tools or any other Data
  required to operate the Spacecraft

  	
   

  	
  Per Exhibit B

  	
   

  	
  NSS Headquarters

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  1 lot

  	
   

  	
  All other documentation, Software and Data as specified in Exhibit B

  	
   

  	
  Per Exhibit B

  	
   

  	
  Per Exhibit B

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
   

  	
  1 lot

  	
   

  	
  Launch Operations Support, Launch Services, Insurance (subject to Article 9),
  IOT, Mission Operations Support, Anomaly Investigation Support, and
  Visibility Services as specified in Exhibit B and all other Services as
  specified in Exhibit B (no Deliverable Hardware will be delivered under this
  category (Paragraph 3.A, Item 4))

  	
   

  	
  Per Exhibit B

  	
   

  	
  Per Exhibit B

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
   

  	
  1

  	
   

  	
  Spacecraft Simulator as specified in Exhibit B

  	
   

  	
  Per Exhibit B

  	
   

  	
  NSS Headquarters

  

 

12

 

Any optional Items ordered by NSS hereunder are
specified in Article 30 and would be delivered, if ordered, pursuant to
the terms of Article 30.

 

B.                                    Time of Essence

 

The Parties understand and agree that the time for
the Promised Delivery Date of the Spacecraft set forth above is of the essence
to this Contract.  Each Party shall use
its reasonable commercial efforts to promote the Delivery of the Spacecraft by XXX and in no event later than XXX days following a Launch on or before XXX. 
Contractor shall immediately notify NSS of any circumstance that will
cause or threaten to cause a delay in Delivery beyond the Promised Delivery
Date.  Contractor shall provide NSS, no
less frequently than quarterly, with Contractor’s best estimate of when Delivery
will occur.  Contractor acknowledges and agrees that its failure to keep NSS informed
of reasonably predictable delays in Delivery may cause damages to NSS for which
NSS may seek recovery in accordance with the terms of this Contract.

 

C.                                    Contractor
Responsibility

 

Delivery of all Items under this Contract shall be
at Contractor’s expense.  As provided in
Paragraph 14.E, Contractor shall be responsible for securing all necessary
export and import authorizations in a timely manner, including, as necessary to
deliver to NSS and its representatives and contractors, technical data under
all applicable laws, rules, and regulations, including the U.S. International
Traffic in Arms Regulations, as the same may be amended (collectively, “Export
Laws”).  Notwithstanding the foregoing,
Contractor shall not be responsible for the payment of any import duties
related to Items delivered to NSS, or Services performed for NSS, in The
Netherlands.

 

ARTICLE 4.  PRICES

 

A.                                    Total
Price

 

The Total Price for the Spacecraft and all other
Items, including all software, documentation, and Services described in items
numbered 1 through 5 in Paragraph 3.A., the IOT Option described in Paragraph
30.E, XXX, and the letter from NSS to Contractor dated May 4, 2004,
CTO/S2/04/04/012, for the scope of the Work detailed in the Statement of Work,
is XXX Dollars ($XXX) (the “Total Price”).

 

13

 

B.                                    Taxes

 

The Total Price and the prices for all other
deliverables (including optional deliverables) under this Contract include all
taxes, duties (except for import duties related to Items delivered to NSS, or
Services performed for NSS, in The Netherlands), transportation, insurance and
all other costs and charges associated with the performance of all Work.  Contractor shall be responsible for payment
of all taxes and duties (except for import duties related to Items delivered to
NSS or Services performed for NSS in The Netherlands) which may be required
under any present or future laws and which become due by reason of performance
of the Work, and shall comply with all requirements of said laws, including
payment of any interest or penalties related to or arising from such taxes and
duties.  For the purposes of this
Contract, the price of the Spacecraft authorized by NSS to be delivered shall
be FOB on station at the Orbital Station and the prices of all other Items
authorized by NSS to be shipped shall be FOB NSS headquarters in The
Netherlands, unless otherwise specified in writing by NSS.

 

C.                                    Adjustments

 

If, on or after the In Service Date, the Spacecraft
experiences one or more failures, degradations or anomalies as detailed in
Exhibit F, the Total Price (including the Escrow Amount and any
Prepayments) shall be adjusted
in the manner and in an amount calculated in accordance with this Paragraph 4.C
and Exhibit F (a “Price Adjustment”). 
NSS shall determine against which future payment(s) due to Contractor
pursuant to the term of this Contract each Price Adjustment will be
offset.  If the sum of all future
payments due to Contractor is less than a Price Adjustment, Contractor shall
promptly (and in any event within thirty (30) days) refund to NSS the
difference between the Price Adjustment and the sum of all future payments due
to Contractor.  The total amount of any
refunds and/or adjustments due to NSS under this Paragraph 4.C and Exhibit F
shall not exceed the Total Price.

 

ARTICLE 5.  METHOD OF PAYMENT

 

A.                                    Milestone
Payment Refund

 

Subject to the provisions of Paragraph 5.B, on or
before February 22, 2005 Contractor shall refund to NSS the One Hundred
Sixty-Eight Million Dollars ($168,000,000) that NSS had paid toward the
Spacecraft under the terms of the Original Contract.

 

14

 

B.                                    Escrow

 

On or before February 22, 2005, NSS shall place
Thirty Million Dollars ($30,000,000)) (“Escrow Amount”) into escrow in NSS’
name pursuant to the Escrow Agreement attached hereto as Exhibit E, and shall
provide documentation to Contractor demonstrating that the Escrow Amount has
been deposited into the Escrow Account. 
If NSS fails to deposit the Escrow Amount into the Escrow Account,
Contractor shall either (as instructed by NSS) (i) refund to NSS One
Hundred Thirty-Eight Million Dollars pursuant to Paragraph 5.A ($138,000,000)
and deposit the remaining Thirty Million Dollars ($30,000,000) into the Escrow
Account or (ii) refund to NSS One Hundred Thirty-Eight Million Dollars
($138,000,000) pursuant to Paragraph 5.A and refund the remaining Thirty
Million Dollars ($30,000,000) to NSS as soon as NSS has provided documentation
to Contractor demonstrating that the Escrow Amount has been deposited into the
Escrow Account. In accordance with the Escrow Agreement, interest accruing on
the Escrow Amount until the XXX shall be
paid to NSS and interest accruing thereafter shall be paid to Contractor.  Contractor may notify the Escrow Agent that
Delivery has occurred pursuant to Section 2.3 of the Escrow Agreement only
when Delivery has actually occurred pursuant to and in accordance with this
Agreement.  NSS shall pay the Acceptance
Fee and the Annual Administration Fee (each as defined in the Escrow Agreement)
for the first year of the Escrow Agreement. 
Contractor shall pay the Annual Administration Fee for the second year
of the Escrow Agreement.  The Parties
shall pay an equal portion of all other fees relating to the Escrow Account
(including any Annual Administration Fees for any subsequent period). The
Escrow Amount shall be paid to Contractor, or refunded to NSS, as applicable,
in accordance with the Escrow Agreement, as follows:

 

1.             Contract
Termination.  If at any point prior
to the In Service Date this Contract is terminated pursuant to Paragraph 18.A,
Contractor shall within five (5) Business Days submit a Disbursement Request
(as defined in the Escrow Agreement) instructing the Escrow Agent to pay the
Escrow Amount and any accrued interest or other investment earnings to NSS;

 

2.             Adjustment
to Total Price.  If at any point
prior to the XXX anniversary of the Payment Start
Date the Total Price is adjusted pursuant to Paragraph 4.C and
Exhibit F to an amount that is less than Thirty Million Dollars
($30,000,000) (or the remaining amount in escrow if distributions have been
made previously pursuant to this Paragraph 5.B(b)), Contractor shall
within five (5) Business Days submit a Disbursement Request instructing the
Escrow Agent to pay the difference between the amount then in escrow and the
adjusted Total Price (together with accrued interest or other investment
earnings on the amount of the disbursement calculated from the Payment Start Date
to the date of the distribution) to NSS;

 

15

 

3.             Disbursement
to Contractor.  At any time after the
first XXX of the Payment Start Date, Contractor
may submit a Disbursement Request instructing the Escrow Agent to pay XXX together with any accrued interest or other investment
earnings on the amount of the disbursement, to Contractor. NSS shall not
protest any Disbursement Request submitted by Contractor in accordance with
this Paragraph 5.B.2;

 

4.             Disputes.  Any disputes between the Parties regarding
distributions from the Escrow Account shall be resolved in accordance with
Paragraph 5.E and Article 21 hereof. 
Before filing a dispute with the Escrow Agent regarding any Disbursement
Request by Contractor, NSS shall use reasonable commercial efforts to provide
Contractor with prior notice of such dispute and the reason NSS believes that
the Disbursement Request was not submitted in accordance with this
Contract.  In the event that NSS disputes
any Disbursement Request by Contractor, then Contractor shall submit a
Disbursement Request instructing the Escrow Agent to pay one-half (1/2) of the
disputed amount (together with any accrued interest or other investment
earnings on such amount) into an escrow account established in accordance with
Paragraph 5.E and to pay the remainder of the Escrow Amount (less any amounts
previously paid or payable to NSS under Paragraph 5.B.2) to Contractor.

 

C.                                    Payment
of Total Price

 

1.             Nature
of Payments.  The entire Total Price
shall be payable as at risk performance incentives and shall be subject to
adjustment based on the performance of the Spacecraft in accordance with
Paragraph 4.C and Exhibit F.

 

2.             Timing
of Payments.  The first XXX Dollars ($XXX) of the
Total Price shall be paid to Contractor on the XXX
of the Payment Start Date XXX to
Contractor in accordance with XXX and
Paragraph 5.B. Payment of the balance of the Total Price (XXX Dollars ($XXX)), as may be
adjusted pursuant to Paragraph 4.C and Exhibit F, shall be made in XXX quarterly payments commencing on the XXX anniversary of the Payment Start Date. Such quarterly
payments

 

16

 

shall be made within thirty
(30) days after receipt by NSS of Contractor’s invoices therefore, the first of
which may be issued by Contractor no earlier than sixty (60) days after
the XXX anniversary of the Payment Start
Date and subsequently in ninety (90)-day intervals.  In the event of a Price Adjustment pursuant
to Paragraph 4.C and Exhibit F, the amount of such Price Adjustment shall be
applied to future payments or refunded to NSS as set forth in Paragraph 4.C.

 

3.             Prepayments.  NSS may prepay the Total Price at any time,
in whole or in part (“Prepayments”).  The
initial XXX payment provided for by Paragraph
4.C.2 shall be deemed to be a Prepayment to the extent that it exceeds the
amount then no longer at risk to Contractor pursuant to Paragraph 4.C and
Exhibit F.  Prepayments shall be
refundable by Contractor to NSS (in the amount specified below) if, after such
Prepayment is made and prior to the end of the Orbital Design Life, the
performance of the Spacecraft has degraded such that Price Adjustments are
appropriate pursuant to Paragraph 4.C and Exhibit F.  Any such refund shall be due within thirty
(30) days after Contractor’s receipt of an invoice from NSS in an amount equal
to the sum of (x) the amount of any Prepayments that, if not prepaid, would
have become due after the date on which the Spacecraft's performance has
degraded such that Price Adjustments are appropriate pursuant to
Paragraph 4.C and Exhibit F, plus (y) interest on each such amount at
the NPV Discount Rate from the date prepaid to the date of payment.

 

D.                                    Interest

 

Commencing on the XXX, NSS shall pay interest to Contractor on a
quarterly basis at the NPV Discount Rate on XXX. 
Interest payments shall be made within thirty (30) days after receipt by
NSS of Contractor’s invoices therefore, the first of which may be issued
by Contractor no earlier than sixty (60) days after the XXX
anniversary of the Payment Start Date and subsequently in ninety (90)-day
intervals.  Interest shall be paid by NSS until the
entire Total Price (as may be adjusted) has been paid in full.

 

17

 

E.                                      Disputed
Payments

 

In the event of a dispute with respect to the
payment of any amount under this Contract (including as a result of a dispute
regarding the calculation of a Price Adjustment under Paragraph 4.C and Exhibit
F or a refund, in whole or in part, of the Escrow Amount), unless otherwise specified in the Contract,
NSS or Contractor (as applicable) shall pay the undisputed amount as and when
due and, on or before the payment due date, shall deposit XXX percent (XXX%) of the disputed amount into an interest-bearing escrow
account to be established jointly by Contractor and NSS promptly upon notice
that a dispute exists at Bank of America, Concord, California.  After the dispute is settled, the Party
entitled to the amount or part thereof in escrow shall receive such amount
together with all interest thereon and the costs and fees associated with such
escrow account shall be paid by each Party in inverse proportion to the amounts
received by each Party.  In the event
that, after the dispute is settled, a Party owes the other Party more than the
amount placed in escrow, then (i) such Party shall pay interest at the NPV
Discount Rate on such amount from the date the amount was due and (ii) such
Party shall pay the entire amount due to the other Party (including interest)
within thirty (30) days of the date on which the dispute is settled.

 

F.                                      Currency/Place
of Payment

 

All payments and/or refunds due from either Party to
the other shall be made in United States Dollars.  Payments and/or refunds to a Party shall be
made by wire transfer of funds to such place for payments and/or refunds as the
receiving Party’s Authorized Representative may designate from time to time in
writing.  Unless NSS otherwise notifies
Contractor, all invoices for payments to be made by NSS shall be addressed as
follows:

 

New Skies Satellites B.V.

Rooseveltplantsoen # 4

2517KR The Hague

The Netherlands

Attn: 
Accounts Payable / Mr. Adrien Bull

 

with a separate                                                                New Skies Satellites B.V.

copy to:                                                                                                    Rooseveltplantsoen # 4

2517KR The Hague

The Netherlands

Attention: 
Vice President, Space Segment Technology

Facsimile No.: 
+31 70 306 4285

 

18

 

NSS-8 Program Office

Building S01, M/S D381

c/o Boeing Satellite Systems, Inc.

P.O.  Box
92919

Los Angeles, CA 90009-2919

Attention: NSS-8 Program Manager

Facsimile No.: 
1-310-426-1443

 

Unless
Contractor otherwise notifies NSS, all payments to be made by NSS to Contractor
shall be made by wire transfer to the following account:

 

Bank of America

Los Angeles Main Office

Los Angeles, CA. 
USA

For deposit to the account of Boeing Satellite
Systems International, Inc.

Account No. XXX

 

ARTICLE 6.  DELIVERY, TITLE AND RISK OF LOSS OR DAMAGE

 

A.                                    Spacecraft
Delivery

 

Risk of loss or damage, and title, to the Spacecraft
shall transfer from Contractor to NSS upon Delivery.  Delivery of the Spacecraft shall occur upon
Acceptance in writing by NSS pursuant to Paragraph 7.D., and delivery of a bill
of sale for the Spacecraft in the form of Exhibit J.

 

B.                                    Delivery
of Other Items

 

Risk of loss or damage and title to all Items other
than the Spacecraft shall transfer from Contractor to NSS upon Delivery.  Delivery of such Items shall occur upon
Acceptance in writing by NSS pursuant to Paragraph 7.E., and delivery of a bill
of sale in the form of Exhibit J, except as otherwise provided in the Statement
of Work.

 

C.                                    Title

 

Contractor warrants that title to all Items
delivered hereunder shall be good, marketable and rightfully conveyed, and
shall be delivered free and clear of all liens, encumbrances, pledges and other
interests whatsoever, except for the security interest in favor of
Contractor created pursuant to the Pledge Agreement and any other interests created
by NSS.

 

19

 

Furthermore,
Contractor agrees to execute and deliver all instruments reasonably required to
perfect or evidence such title in NSS.

 

ARTICLE 7.  CERTIFICATION, INSPECTION, ACCEPTANCE,
WAIVERS

 

A.                                    General
Requirements

 

Contractor is responsible for testing,
demonstrating, delivering, XXX the
Spacecraft and all other Deliverable Hardware and Deliverable Data meet all of
the requirements of this Contract, including the Spacecraft Performance Specifications.  NSS’ right of inspection or acceptance shall
not be deemed a waiver of any defect, except as may be expressly agreed in
writing by NSS in accordance with Paragraph 7.B. below.  Prior to asking NSS to accept any Items and
prior to Delivery, XXX.

 

B.                                    Waivers

 

Contractor shall immediately notify NSS at such time
that Contractor determines that it will not be able to meet a particular
Contract requirement or specification and seek a waiver from NSS.  Nothing herein shall be deemed to require NSS
to grant a waiver, but, if it is willing to consider doing so, and except for
adjustments which are addressed in other Articles of this Contract, NSS and
Contractor shall negotiate in good faith reasonable consideration (in the form
of a reduction in the Total Price of the Spacecraft) for any requested waiver
that represents a material deviation from Contract requirements or
specifications.  If the Parties cannot
agree on an appropriate amount, XXX
subject to a determination by binding arbitration under Article 21 of an
appropriate price adjustment.

 

C.                                    Inspections

 

Preliminary inspections of Items may be made by NSS
or its designated representatives at either Contractor’s or, subject to any
Subcontractor’s consent, a Subcontractor’s plant, as the case may be.  Contractor shall use reasonable efforts to
accommodate NSS’ inspection requests and to further request such inspections at
a Subcontractor’s plant when reasonable and appropriate.  All such inspections shall be in the company
of a Contractor’s representative; provided that, it after reasonable notice
(orally or in writing) of NSS’ inspection plans at a Subcontractor’s facility,
Contractor shall have failed to furnish such a representative, NSS may conduct
an unaccompanied inspection, subject to Subcontractor’s consent.  Without limiting Contractor’s own

 

20

 

responsibilities
in this respect, Contractor shall also remedy any and all defects identified by
NSS in the course of such inspections.

 

D.                                    Spacecraft
Acceptance Procedure

 

Following a successful completion of the pre-shipment inspection of the
Spacecraft, Contractor shall ship the Spacecraft to the Launch Site and proceed
with the further testing and Launch of the Spacecraft in accordance with the
Statement of Work and the Test Plan. 
Contractor shall notify NSS of the lOT schedule at least thirty
(30) days prior to the Launch of the Spacecraft.  The lOT shall be conducted In accordance with
the Statement of Work and the Test Plan, and NSS’ representatives shall be
permitted to observe all phases of the lOT. 
When the IOT is completed, Contractor shall submit to NSS the test
results and shall hold an acceptance review with NSS in accordance with the
requirements of the Statement of Work and the Test Plan.  At the conclusion of the acceptance review
and upon arrival of the Spacecraft at the Orbital Station, XXX NSS shall accept the Spacecraft, or, if
the Spacecraft is a Total Loss, NSS may, at its option, reject the Spacecraft
and terminate this Contract in accordance with Paragraph 18.A.1.  For the avoidance of doubt, the Spacecraft
shall be deemed not to meet XXX the
requirements of the Spacecraft Performance Specifications if, based on the IOT
results and any other information known to Contractor XXX, Contractor determines in good faith,
using sound technical judgment, that the Spacecraft has suffered a Failure and
will not meet the requirements of the Spacecraft Performance Specifications
throughout the Orbital Design Life.

 

E.                                      Acceptance
Procedures for Other Items

 

Except as specified in the Statement of Work,
Acceptance of Items to be Delivered under the Contract other than the
Spacecraft shall occur in accordance with the requirements of this Paragraph
7.E.  Contractor shall certify to NSS the
results of its inspection and tests of all such Items in a form acceptable to
NSS.  Based upon this certification, upon
which NSS shall be entitled to rely, and any inspection or testing that NSS may
conduct, NSS shall either accept the same in writing or notify Contractor in
writing of those defects in which the Items are unacceptable.  Upon receipt of a notice that any Item is
unacceptable to NSS, Contractor shall remedy such item.  Upon remedy of such defects XXX, the Item shall be accepted by NSS in
writing.

 

21

 

F.                                      Remedy
of Defects

 

Except as set forth in Paragraph 7.G. below with
respect to a Spacecraft after Delivery, remedy of any defects in an Item shall
be accomplished by Contractor at its expense, promptly upon receipt of notice
thereof.  Any Items found to be
non-conforming during or after testing required under this Contract, XXX and without charge to NSS, shall be
promptly re-tested (together with any other potentially affected parts or
systems) by Contractor both at the unit level, and, if NSS requests in its sole
discretion exercised in good faith, at a system level or of the entire
Spacecraft (XXX) after Contractor
has remedied such non-conformance.

 

G.                                    Post
Acceptance Remedies

 

After Acceptance by NSS of the Spacecraft,
Contractor shall fully cooperate with NSS and Contractor, at NSS’ request,
shall investigate and assist NSS in remedying, to the extent reasonably
practicable, any defects that are identified on the Spacecraft (including,
without limitation, through changes in operational procedures, software, or,
where possible, Spacecraft configurations) until the end of the Orbital
Maneuver Life.

 

ARTICLE 8.  LAUNCH SERVICES PROCUREMENT

 

Contractor’s current intention is to Launch the
Spacecraft on a Sea Launch Launch Vehicle with a minimum performance capability
of XXX, within a launch window of XXX (the “Nominal Launch Plan”).  Contractor may (at its sole cost, without any
adjustment to the Promised Delivery Date or the deadlines set forth in
Paragraph 18.A.1, and subject to its obligations under Paragraph 3.B) change
the Launch Vehicle to be used to Launch the Spacecraft, provided that
Contractor’s selection shall be subject to NSS’ prior written consent if the
selected Launch Vehicle is not a Sea Launch Launch Vehicle or an Alternate
Launch Vehicle.  Contractor shall
be required to obtain NSS's prior written consent, not to be unreasonably
withheld, conditioned or delayed, if the Launch Vehicle mission to be used to
Launch the Spacecraft will be the first mission by such Launch Vehicle
following a launch failure or material malfunction or anomaly. In considering
whether to grant its consent under the previous sentence, NSS shall be entitled
to make its own independent assessment of the risk of the failure of the Launch
of the Spacecraft but shall also take into consideration the extent to which
Contractor is assuming, if at all, an uninsured risk of a failure or
malfunction of the Launch Vehicle selected by Contractor. Contractor shall promptly notify NSS of any
changes to the

 

22

 

Nominal
Launch Plan and of any other circumstance that would give rise to NSS’ approval
rights hereunder.  Contractor shall be
responsible for entering into a Launch Services Agreement with the Launch
Services Provider (which shall comply with the requirements of Exhibit L) and
shall be responsible for all payments, launch campaign support and all other
requirements of and obligations to the Launch Services Provider arising under
the Launch Services Agreement and for any licenses or other authorizations that
may be required under the Export Laws in connection with the Launch.  Contractor shall be responsible for ensuring
that the performance capability of the selected Launch Vehicle and the design
and conduct of the launch campaign will enable Contractor to meet all of its
obligations to NSS under this Contract, including the Delivery of the
Spacecraft so that it will meet the Contracted Orbital Maneuver Life.  Contractor shall provide NSS and its
consultants with all reports, data and documentation generated by Contractor or
provided to Contractor by the Launch Services Provider with respect to the
Launch of the Spacecraft and provide NSS and its consultants complete access to
all meetings, reviews, Spacecraft/Launch Vehicle integration activities at the
Spacecraft factory and at the Launch Site, and Launch Vehicle anomaly or
failure investigation activities related to the Launch of the Spacecraft to the
same extent as Contractor has access thereto. 
Contractor shall use reasonable commercial efforts, acting on a
non-discriminatory basis vis-à-vis itself and its other customers, to protect
NSS’ interests in the conduct of the Launch by the Launch Services Provider,
including in maintaining the current launch window and, in the event that the
launch window must be changed due to a launch failure, in obtaining a prompt
replacement window.  In the event that
Contractor changes the Launch Vehicle to be used to Launch the Spacecraft in
accordance with this Article 8, the Parties shall agree on amended
definitions for Intentional Ignition, Launch, Terminated Ignition, and The
Spacecraft Absolute Latest STOP to
the extent necessary to conform to the new Launch Services Agreement.  During construction, prior to and during
Launch and IOT, Contractor shall not intentionally take any action (or omit to
take any action) without NSS’ prior written consent where such action (or
omission) would reasonably be expected to reduce the Spacecraft’s anticipated Orbital
Maneuver Life.

 

ARTICLE 9.  INSURANCE

 

Contractor may procure, at its expense, insurance to
cover its risk of a Total Loss of the Spacecraft or a malfunction of the
Launch Vehicle and/or the Spacecraft such that Price Adjustments would be
required under Paragraph 4.C and Exhibit F. NSS may procure, at its
expense, insurance to cover its risks of any loss arising from any action or
omission by NSS.

 

23

 

In
the event that either Party procures insurance in accordance with this Article 9,
such Party shall consult with the other Party before disclosing or
characterizing to insurance brokers or underwriters any information related to
the health or performance of the Spacecraft, whether during a procurement, renewal,
investigation or settlement of a failure or potential failure, or
otherwise.  Each Party shall consult with
the other Party before seeking to procure or authorizing another party to
procure insurance relating to the performance, or operation of the
Spacecraft.  Neither Party shall be
required to procure any insurance or to reimburse or otherwise compensate the
other Party for the cost of any insurance obtained by such other Party or to
consult with such other Party regarding the terms of any insurance that it
elects to procure.  Each Party shall use
reasonable commercial efforts, at the request of the other Party, to assist the
other Party in obtaining and maintaining any insurance and in investigating,
preparing, filing, administering and otherwise pursuing any claims or potential
claims thereunder, subject to reimbursement by the requesting Party of any
material costs and expenses incurred by such Party in providing such
assistance.

 

ARTICLE 10.  SUBCONTRACTS

 

A.                                    Subcontracts

 

Within ninety (90) days after the Effective Date of
Contract, Contractor shall provide a list of all Subcontracts with a value in
excess of Five Hundred Thousand Dollars ($500,000) and shall identify the work
to be provided in each such Subcontract. 
Changes to this list shall be detailed in each quarterly report, to be
provided by Contractor pursuant to the Statement of Work.

 

B.                                    Key
Subcontracts

 

Contractor agrees to enter into major Subcontracts
(hereinafter referred to as “Key Subcontracts”) for the Work specified below
with the persons or entities (hereinafter referred to as “Key Subcontractors”)
listed below.  Contractor further agrees
that the Key Subcontractors are necessary for the successful completion of the
Work to be performed hereunder. 
Contractor shall not change its key Subcontractors without NSS’ prior
written consent.

 

24

 

	
  Key Subcontractor

  	
   

  	
  Work

  
	
  1.       Sea Launch

  	
   

  	
  Launch

  
	
  2.       Thales

  	
   

  	
  C/Ku TWTs

  
	
  3.       Spectrolab

  	
   

  	
  Triple Junction GaAs Solar Cells

  
	
  4.       Swales

  	
   

  	
  Loop Heat Pipes

  
	
  5.       AASC/CHI

  	
   

  	
  Structure Assemblies

  
	
  6.       Reserved

  	
   

  	
   

  
	
  7.       NEC

  	
   

  	
  C/Ku Quad LNAs

  
	
  8.       Saab

  	
   

  	
  C Downconv/Ku Upconv

  
	
  9.       EDO

  	
   

  	
  Ku Downconv

  
	
  10.     L3 Com

  	
   

  	
  XIPS Thrusters/Passive Microwave

  
	
  11.     Pilkington

  	
   

  	
  Reflector Mirrors

  
	
  12.     ATK

  	
   

  	
  45” DGS Reflector

  
	
  13.     Custom Microwave, Inc.

  	
   

  	
  C-band T/R CP Feed

  

 

ARTICLE 11.  PROPERTY ACCOUNTING

 

A.                                    Identification
and Control

 

Contractor shall be directly responsible for and
accountable for all supplies, parts,
materials, components, subsystems or systems (whether in its possession
or, where feasible, the possession of any of its Subcontractors) which are
designated to become the property of NSS pursuant to the terms of this
Contract, and which are part of the Items to be Delivered under this
Contract.  For this purpose, Contractor
shall establish and maintain a system to control, protect, preserve and
identify, at all times and until the Delivery and Acceptance of the last Item
to be delivered hereunder, all of the aforementioned property in its possession
or, where feasible, the possession of
its Subcontractors. Once supplies, parts, materials, components, subsystems or
systems have been installed on or designated for the Spacecraft, such supplies,
parts, materials, components, subsystems or systems shall not be redeployed to
another of Contractor's programs without notice to, and consent from, NSS, and
in no event if such redeployment would jeopardize the schedule for Delivery of
any Item hereunder.

 

B.                                    Subcontractors

 

Contractor shall, where feasible, require
Subcontractors who are responsible for developing or manufacturing any of the
Items to be delivered under the terms of this Contract to comply with
provisions similar to the provisions of this Article.

 

25

 

C.                                    Inventory

 

Contractor shall maintain an inventory of all NSS
designated property in its possession that has been incorporated into the
Spacecraft.  Contractor shall retain and
shall use its reasonable efforts to cause Subcontractors to retain, inventory
records of property incorporated into the Spacecraft, until the end of the Orbital Maneuver Life or until
the Spacecraft has been rendered inactive, or for so long as NSS instructs
Contractor or Subcontractors to maintain records of such property.  Contractor and Subcontractors shall have
inventory records covering the property incorporated into the Spacecraft
available for NSS review and inspection, upon reasonable notice.  If there are no property inventories in
Contractor’s or Subcontractors’ possession, notification shall also be provided
to that effect to NSS.

 

ARTICLE 12.  CHANGES REQUESTED BY CONTRACTOR OR NSS

 

A.                                    Contract
Change Notice

 

Any changes requested during the performance of this
Contract which will add or delete Work, affect the design of the Spacecraft,
change the method of shipment or packing, or place or time of any Delivery, or
will affect any other requirement of this Contract, whether proposed by
Contractor or NSS, shall be reflected by Contractor in writing as a contract
change notice in accordance with the Statement of Work (“Contract Change Notice”)
issued at least thirty (30) days prior to the proposed date of the change.

 

B.                                    Acceptance
of Change

 

1.             Changes
in the Ordinary Course.  For all
Contract Change Notices other than those described in Paragraph 12.B.2, NSS
shall notify Contractor within ten (10) Business Days after receipt of a
Contract Change Notice whether or not it agrees with and accepts such
change.  If NSS agrees with and accepts
the change, Contractor shall proceed with the performance of the Contract as
changed, and an amendment to the Contract reflecting such change, and price
and/or schedule adjustments, if any, shall be issued.  If NSS does not agree to implement the
change, and the Parties are unable to reach any other agreement regarding such
change, Contractor shall proceed with the performance of the Contract, as
unchanged.  NSS shall be permitted to
refer any dispute as to the price of a change to arbitration and/or authorize
the change, subject to binding arbitration under Article 21 as to the
change order price.  In circumstances
where NSS authorizes Contractor to go forward pending arbitration, Contractor
shall proceed with the change, with the price effect to be so determined by

 

26

 

arbitration; provided that,
pending conclusion of such arbitration, Contractor shall be entitled to receive
partial payment from NSS in the amount of the undisputed portion of the price
of the change, within thirty (30) days after Contractor issues an invoice for
such amount.  NSS shall deposit the
disputed amount of the change price into an interest-bearing escrow account to
be allocated and distributed between the Parties at the conclusion of, and in
accordance with, the arbitration.

 

2.             Changes
Resulting from a Technical Disagreement. 
If, as a result of a technical disagreement, Contractor has issued a
Contract Change Notice pursuant to Paragraph 21.B, NSS shall notify Contractor
within five (5) Business Days after receipt of such Contract Change Notice whether
or not it agrees with and accepts such change. 
If NSS agrees with and accepts the change, Contractor shall proceed with
the performance of the Contract as changed, and an amendment to the Contract
reflecting such change, and price and/or schedule adjustments, it any,
shall be issued.  If NSS disputes the
change, it shall either (i) instruct Contractor to proceed without making the
change or (ii) instruct Contractor to proceed with the change.  If NSS instructs Contractor to proceed with
the change, NSS shall deposit XXX of the
proposed change price into an interest-bearing escrow account to be allocated
and distributed between the Parties at the conclusion of, and in accordance
with, the resolution of the dispute under Article 21.  NSS’ instruction to Contractor (whether to
proceed with Work under a Contract Change Notice or not to perform such Work),
shall not be deemed a waiver of NSS’ rights or remedies under the Contract, or
of NSS’ right to challenge Contractor’s proposed price for a Contract Change
Notice.  Contractor's acceptance of the XXX partial payment of the price of a Contract Change Notice
pending arbitration shall not be deemed a waiver of Contractor's rights or
remedies under the Contract or of Contractor's right to claim that the work covered
by a Contract Change Notice was not required to be performed pursuant to the
Contract.

 

C.                                    Non
Refusal

 

Contractor may not refuse any change that may be
requested by NSS during the performance of this Contract as long as the
NSS-requested change is within the general scope of this Contract and is
technically feasible.

 

27

 

D.            Price
of Changes

 

All pricing determinations for changes shall be based on the materials
and efforts involved in implementing the change (which shall be described to
NSS in reasonable detail) and such materials and efforts previously required
that will no longer be required.  XXX Calculation of expense savings for Work
that is not required, regardless of who requested the change, shall include a
deduction for the applicable profit margin. 
In addition, if certain supplies or materials already acquired for the
Work are made obsolete or excess as a result of a change, NSS shall have the
right to prescribe the manner of disposition of such supplies or materials.

 

E.             Compressed
Time Periods

 

The time periods specified in this Article and in the Statement of Work
for proposing and approving changes may be shortened as necessary to
accommodate exigent circumstances.

 

F.             Changes
To Meet Specifications

 

For the avoidance of doubt, in no event shall NSS be required to pay
for any change, accept any deviation in performances or specifications, or
allow any delay to the extent that Contractor is required to remedy any
defects, including those that may become apparent through the testing or
operation of other spacecraft, all such Work to be performed by Contractor at its
sole cost and expense.

 

G.            Pending RDWs

 

NSS hereby agrees to disposition the requests for deviation and waiver
set forth in Exhibit M on a no-cost basis.

 

ARTICLE 13.  CONTRACT TECHNOLOGY

 

A.            Disclosure
of Contract Technology

 

From the Effective Date of Contract, and for a period of twenty-four
(24) months after the Delivery of the Spacecraft, Contractor shall maintain
copies of all Contract Technology (including Contract Data previously delivered
to NSS hereunder).  During such period,
and thereafter to the extent such Contract Technology is retained by
Contractor, NSS may have access to and/or request copies of such Contract

 

28

 

Technology to the extent reasonably required for preparing, launching, testing,
maintaining, operating, using or marketing capacity on or services that employ
the Spacecraft.  Within seven (7) days
after receipt of such request, Contractor shall furnish copies of the requested
Contract Technology.  The cost of
furnishing copies of such Contract Technology shall be borne by the requester
and shall include the cost of collecting, editing,
duplicating, assembling and shipping, to the extent not included in the
Contract price, but shall not include any amount associated with the value of
such Contract Technology.  The Contractor
may, by appropriate marking on Contract Technology, indicate that such shall be
used only in accordance with the terms of this Contract.

 

B.            Rights
Granted in Contract Technology

 

1.             Contract
Data.  Contractor hereby grants to
NSS an irrevocable, non- exclusive, royalty free, worldwide Right to Use and
Right to Publish Contract Data in connection with XXX, launching, testing, maintaining, operating, XXX and XXX
the Spacecraft.

 

2.             Contract
Intellectual Property.  For all
Contract Intellectual Property owned by Contractor or under which Contractor
has rights, Contractor hereby grants to NSS an irrevocable, non-exclusive,
royalty free, worldwide License to Practice under such Contract Intellectual
Property in connection with preparing, launching, testing, maintaining,
operating, using, and marketing capacity on or services that employ the
Spacecraft.

 

C.            Limitations

 

NSS’ rights to receive and/or, disclose Contract Technology shall be
subject to the Export Laws and Article 27 of this Contract.

 

ARTICLE 14.  RIGHT OF ACCESS, REPORTS,
TESTING, MONITORING

 

A.            Access

 

Subject to compliance with the Export Laws Compliance Program, NSS
shall have the access rights specified below and as described in the Statement
of Work.

 

1.             Work.  NSS shall be allowed reasonable access to
Contractors facilities and to all Work and Work in progress, and all data and
information related to

 

29

 

this Contract, for purposes of
observation, inspection, examination and evaluation, at any reasonable time
prior to Acceptance of the relevant Item or termination of this Contract and
thereafter to the extent such data and information are of the type customarily
retained in the ordinary course of business.

 

2.             Subcontracts.  Contractor shall provide access rights to NSS
to the subject matter of the Key Subcontract with Spectrolab to the same extent
as access is provided to Contractor.  For
all other Key Subcontracts, Contractor will use best efforts to negotiate terms
that will provide access rights to NSS to the subject matter of the Key
Subcontracts to the same extent as access is provided to Contractor.  For all other Subcontracts, Contractor shall
use reasonable efforts to negotiate terms that will provide access rights to
NSS to the subject matter of the Subcontracts to the same extent as access is
provided to Contractor.  Such NSS access
shall be coordinated through Contractor’s product assurance program interface.

 

B.            Reports

 

Subject to compliance with the Export Laws Compliance Program,
Contractor shall deliver to NSS written progress and status reports, test data,
and any final reports, in accordance with the requirements of the Statement of
Work.  All reports furnished pursuant to
this Paragraph may be used and distributed by NSS in accordance with the
provisions of this Contract.

 

C.            Performance
Testing

 

Subject to compliance with the Export Laws Compliance Program, NSS
shall have the rights with respect to testing set forth below and in the Statement
of Work.

 

1.             Witness
of Tests.  All developmental,
qualification and acceptance testing of Items required by this Contract may be
witnessed by NSS’ representatives at Contractor’s or Subcontractor’s plant
(subject to Subcontractor’s consent which Contractor shall use reasonable
efforts to obtain) or at such other place as the tests are conducted or test
results are monitored, and NSS shall be provided with access to and copies of
same to the extent specified in the Statement of Work or requested by NSS.

 

2.             Acceptance
Tests.  NSS shall have the right
reasonably to specify the times and places for the undertaking of final
acceptance testing of any Deliverable Hardware to be delivered in accordance
with the requirements of this Contract.

 

30

 

3.             Notice
of Tests.  If Contractor or any
Subcontractor establishes the time, date, or location of any testing required
under this Contract, Contractor shall provide, or cause the Subcontractor to
provide, NSS with the advance notice specified in this Contract, or if not
specified, with reasonable advance notice. 
Contractor reserves the right to perform any testing under this Contract
without NSS’ participation where such prior written notice was provided to NSS.

 

4.             Test
Plan.  All testing under this
Contract shall be undertaken in accordance with the Test Plan and the Statement
of Work.

 

D.            Monitoring

 

Subject to compliance with the Export Laws Compliance Program,
approximately four (4) of NSS’ personnel and consultants shall be located at
the manufacturing site of the Spacecraft for the purpose of monitoring the
progress of the Work as specified in the Statement of Work.  Contractor shall provide office and other
facilities to such personnel and consultants as described in the Statement of
Work.  In addition, Contractor shall
provide adequate parking spaces for NSS on-site personnel and consultants.  NSS personnel and consultants shall have
twenty-four (24)-hour access to the office space provided hereunder.  The witnessing of tests and the monitoring of
progress of Work under this Article 14 shall be subject to Contractor’s
personnel accompanying NSS personnel during such activities.  Contractor shall obtain from the Key
Subcontractors the rights for Contractor’s personnel and for NSS’ personnel and
consultants to access the Work in progress related to the Spacecraft at the Key
Subcontractors’ plants.  To the extent
Contractor has similar rights of access to the plants of other Subcontractors, it shall permit NSS’ personnel and
consultants to accompany Contractor’s personnel to such plants, subject to the
consent of the Subcontractor, if required.

 

E.             Export
Laws Compliance

 

The export of any Items under this Contract is subject to the approval
of the United States government through its relevant agencies and bodies.  Contractor shall promptly implement the
Export Laws Compliance Program described in Exhibit G to obtain and maintain
all authorizations and consents under the Export Laws necessary to permit NSS
to take Delivery of all Items and to permit NSS, the Launch Services Provider,
the insurance underwriters or other third parties with a need to access to

 

31

 

information supplied by Contractor or Subcontractors under any of the
provisions of the Contract, and their respective personnel and consultants, to
have full access to the Work, reports, testing and monitoring and all
information, documents and data related thereto, as specified in this Contract.  Contractor shall use best efforts to obtain
such authorizations and consents prior to the Spacecraft system-level
preliminary design review as set forth in the Statement of Work.  Pending receipt of such authorizations and
consents, Contractor shall employ Satellite Consulting, Inc. as an independent
auditor who will provide a minimum of two (2) equivalent man
- months per month of auditor support. 
Individuals provided by Satellite Consulting, Inc. for this effort shall
have access to all Items and all Work, reports, testing and monitoring and all
information, documents and data related thereto, to which NSS’ and any
necessary third parties’ access is precluded by the Export Laws.  The independent auditor will have full
authority to exercise any and all access and related rights under the Contract,
with respect to the material and information to which it is given access under
the foregoing.  At the time of receipt of
the authorizations under the Export Laws Compliance Program, the independent
auditor will transition its access rights to NSS as permitted by the Export
Laws, and NSS shall assume full access rights with respect thereto.  For clarification purposes, the cost of
Satellite Consulting, Inc.’s services shall be borne by Contractor until 5
August 2001; after which, and until such time as Satellite Consulting, Inc.
obtains the proper export authorizations, NSS will reimburse Contractor for any
Satellite Consulting, Inc. costs incurred by Contractor under the NSS-8
program.  Contractor may invoice NSS for
these Satellite Consulting, Inc. costs on a monthly basis (with net 30 days
payment terms) commencing the month of December 2001.  Upon receipt by Satellite Consulting, Inc. of
proper export authorization, Contractor shall terminate its NSS-8 program
purchase order with Satellite Consulting, Inc. and invoice NSS for any
remaining amounts due.  NSS shall then
assume any future procurement responsibility for Satellite Consulting, Inc.’s
services under the NSS-8 program.  To the
extent any access by NSS specified in this Contract is not permitted by the
Export Laws, the independent auditor specified above shall continue to have
access and the authority to exercise access-related rights on behalf of
NSS.  Nothing in this Article 14 shall
preclude NSS and any necessary third parties, during the period when the Export
Laws Compliance Program is pending, from having access to any Items and all
Work, reports, testing and monitoring and all information, documents and data
related thereto, to the extent such access is not precluded by the Export Laws.

 

32

 

ARTICLE
15.  WARRANTY

 

A.            Warranty

 

Contractor warrants that, notwithstanding prior inspection or
Acceptance by NSS:

 

1.             All Deliverable
Hardware shall be in good working order and free from all defects in
workmanship and materials and shall conform with the
requirements of this Contract;

 

2.             All Deliverable Data
shall conform with the requirements of this Contract; and

 

3.             All Services shall be
performed in a skillful and workmanlike manner and shall conform with the requirements of this Contract.

 

Contractor shall pass through to NSS any warranties regarding Launch
Services that Contractor obtains from the Launch Services Provider.

 

B.            Remedies

 

Promptly after receipt of written notification from NSS that Work is
defective or non-conforming, Contractor shall, XXX, either (i) correct, repair or
replace, at Contractor’s sole expense, any defective or non-conforming Work so
as to comply with the above warranties, or (ii) reimburse NSS for such portion
of the price as is equitable.  The
remedies stated herein shall not apply to the extent a defect results from
willful misconduct or gross negligence on the part of NSS, its employees,
agents, consultants or representatives.

 

C.            Warranty
Period

 

Except as provided in the following sentence, the above warranties
shall continue for a period of XXX
years from the date of Acceptance of each Item, except, however, all
corrections, repairs and replacements made pursuant to this Article by
Contractor after Acceptance shall be so warranted for a period of XXX years from the date of Acceptance of
such corrections, repairs or replacements. 
The warranties in Article 15 shall apply to a Spacecraft after Launch as
follows:

 

(i)            NSS acknowledges that it may not be
commercially feasible for Contractor to correct, repair or replace certain
defective or non-conforming Work following Launch and agrees that, in such
cases, its sole remedy under Paragraph 15.B shall be as stated in Paragraph
15.B(ii);

 

(ii)           To
the extent NSS obtains a reduction in the Total Price pursuant to Paragraph 4.C
and Exhibit F, NSS shall not be entitled to also receive a warranty
reimbursement for such defect under Paragraph 15.B(ii);

 

(iii)          Neither
of the foregoing provisions shall be construed to relieve Contractor of any
obligation to correct, repair or replace defective or non-conforming Work on
the Spacecraft prior to Launch;

 

(iv)         The
warranties in this Article shall not apply to the Spacecraft after Acceptance;
provided that the foregoing shall not be construed to relieve Contractor of any
liability that may arise out of any willful, knowing or reckless
misrepresentation to NSS by Contractor hereunder.

 

33

 

D.            Disclaimer

 

Except as otherwise set forth herein and in other articles of this
Contract, Contractor expressly disclaims any express or implied warranties,
including without limitation, warranties of fitness for a particular purpose
and merchantability.

 

E.             Not
Exclusive Rights

 

Subject to Article 23 the rights and remedies of NSS provided in this
Article are in addition to any other rights and remedies provided by law or
under this Contract.

 

ARTICLE 16.  DEFICIENCIES NOTED IN OTHER
SPACECRAFT

 

A.            Qualification
Heritage

 

XXX

 

B.            Notice

 

Whether before or after Acceptance of the Spacecraft, Contractor shall
immediately notify NSS of any circumstance, known to or suspected by Contractor
that

 

34

 

would make any statement set forth in Paragraph 16.A., if made at the
time, no longer the case, and of any other data available to it that indicates
(i) that conditions exist which affect or may affect
adversely the Spacecraft operation, or (ii) that the Spacecraft performance
and/or operation depart or may depart from that expected from the program
documentation at any time during the period of the Spacecraft’s Orbital
Maneuver Life, or (iii) that the Spacecraft does not meet all the requirements
of the Spacecraft Performance Specifications, or can not be reasonably
predicted to be able to meet the requirements of the Spacecraft Performance
Specifications for the full Orbital Maneuver Life.  Contractor shall take prompt appropriate
corrective measures at its sole cost in any Spacecraft that has not been Launched so as to eliminate all the deficiencies so noted or
suspected, to NSS’ satisfaction.  NSS
shall have the right to reject, until Intentional Ignition any Spacecraft that
does not meet the requirements of this Article 16.  Thereafter, NSS’ obligations to complete
Delivery and Acceptance of the Spacecraft shall be governed by other provisions
of this Contract.

 

ARTICLE 17.  TERMINATION FOR CONVENIENCE

 

A.            Termination

 

NSS may, prior to Contractor’s completion of all Work, by written
notice issued by NSS’ Authorized Representative, terminate this Contract
(except for any Items for which Delivery and Acceptance have been completed)
for its convenience, whereupon Contractor shall cease Work in accordance with
the terms of said notice.

 

B.            Termination
Expense

 

Contractor shall promptly submit to NSS a detailed written statement of
Contractor’s total out of pocket expense incurred in the performance of Work
and total out of pocket expenses resulting from such termination as determined
in accordance with Contractor’s standard accounting practices and, at NSS’
request and expense, verified to NSS by Contractor’s or other reputable
independent certified public accountants (hereinafter referred to as “Total
Verified Termination Expense”).

 

C.            Termination
Charges

 

Termination charges shall be negotiated by NSS and Contractor based
upon the Total Verified Termination Expense plus a profit margin of XXX percent (XXX%).

 

35

 

1.             Maximum
Charge.  In no event shall termination
charges exceed the lesser of (i) the Total Verified
Termination Expense plus the profit margin specified above or (ii) the Total
Price.

 

2.             Payment.  Termination charges, as negotiated, less (I)
amounts previously paid by NSS pursuant to this Contract after the date of this
Composite Compiled Satellite Contract, if any, and (ii) amounts representing
termination charges attributable to Deliverable Hardware and the Launch
Services Agreement and other rights associated therewith (to the extent NSS does
not elect to retain same) which Contractor or any of its Subcontractors elects
to retain (which election Contractor shall make as to each item for which it
has another reasonably compatible use), shall be paid by NSS (or, if a net
refund is due, by Contractor) within sixty (60) days after receipt of
Contractor’s (or, if applicable, NSS’) invoice therefor.

 

D.            Subcontractor
Settlements

 

Contractor shall advise NSS of all proposed settlements with vendors
and Subcontractors in the event of termination, and Contractor further shall
not enter into any binding settlement until NSS has approved the proposed
settlement or until thirty (30) days have elapsed from the date when NSS was
advised of the proposed settlement, without approval or objection by NSS.

 

E.             Inventory

 

In the event of such a termination, all inventory generated under this
Contract, except that retained by Contractor or Subcontractors pursuant to
Paragraph 17.C.2, shall become the property of NSS.

 

ARTICLE 18.  TERMINATION FOR OTHER REASONS

 

A.            Termination
by NSS for Cause

 

NSS may, by written notice issued by NSS’ Authorized Representative,
terminate this Contract, in whole or in part (except for any Items for which
Delivery and Acceptance have been completed) if:

 

1.             (A) the Spacecraft is
a Total Loss prior to Acceptance, or (B) the
Spacecraft has not been Launched by XXX,
or (C) the Spacecraft is not approved and authorized for shipment to the
Launch Site (with

 

36

 

no liens
thereon) by XXX, or (D) Contractor
determines in good faith that the Launch date in clause (B) or the
authorization to ship date in clause (C) will not be met (in which case
Contractor shall promptly notify NSS);

 

2.             XXX;

 

3.             Contractor commits a
material breach of this Contract or otherwise fails to perform any other
material provisions of this Contract, and such breach or failure is not cured
within thirty (30) days from the date of such notice; or

 

4.             Contractor shall (i) apply for or consent to the appointment of a receiver, trustee,
custodian, intervenor or liquidator of itself or
substantially all of its assets; (ii) file a voluntary petition in bankruptcy,
admitting, in writing, that it is unable to pay its debts as they become due;
(iii) make a general assignment for the benefit of creditors; (iv) file a
petition or answer seeking reorganization or arrangement with creditors to take
advantage of any bankruptcy or insolvency laws; (v) file an answer admitting
the material allegations of, or consent to, or default in answering, a petition
filed against it in any bankruptcy, reorganization or insolvency proceeding
where such action or failure to act will result in a determination of
bankruptcy or insolvency; or (vi) downsize or discontinue its commercial
communications spacecraft manufacturing business such that Contractor’s ability
to perform its obligations under this Contract is impaired.

 

Contractor acknowledges and agrees that the deadlines contained in
Paragraph 18.A.1 are firm, fixed deadlines and are not subject to adjustment
for any reason, at law or in equity, regardless of the reason for the delay,
including but not limited for delays beyond the control of Contractor, Launch
delays (including Launch delays caused by a launch failure of the Spacecraft or
another satellite), delays caused by force majeure
events, and otherwise, and may be adjusted only by a written amendment signed
by NSS.  Upon termination pursuant to
this Paragraph 18.A., NSS shall receive, within thirty (30) days of
termination, a full refund of the Escrow Amount and all accrued interest
thereon that has not previously been paid to NSS and, upon such refund, NSS
shall be relieved

 

37

 

of all further obligations under this Contract and NSS shall relinquish
all of its rights to Items for which Delivery and Acceptance have not been
completed, and return or destroy all Deliverable Data not related to Items for
which Delivery and Acceptance have been completed previously that is in
tangible form.

 

B.            Improper
Termination

 

If, after termination under the provisions of Paragraph 18.A, it is
determined for any reason that the Contract was terminated improperly under the
provisions of this Article, the rights and obligations of the Parties shall be
the same as if termination had been effected pursuant to Article 17.

 

ARTICLE
19.  SECURITY

 

A.            Grant
of Security Interest

 

As security for payment by NSS to Contractor of incentive payments and
interest due to Contractor under Paragraphs 5.C and 5.D (as may be adjusted pursuant
to Paragraph 4.C and Exhibit F), NSS and Contractor shall, on the date of this
Contract, execute the Pledge Agreements.

 

B.            Representations
and Warranties; Covenants

 

1.             Representations
and Warranties.  NSS represents and
warrants to Contractor that:

 

a.             the
performance by NSS of its obligations under this Article 19 and the execution,
delivery and performance by NSS of the Pledge Agreements and the Escrow
Agreement have been authorized by all necessary corporate and shareholder
action;

 

b.             upon
the effectiveness of the NSS Credit Agreement Amendment (which effectiveness is
conditioned only upon the application of a portion of the milestone payment
refund referred to in Paragraph 5.A of this Contract in prepayment of
outstanding term loans under the NSS Credit Agreement), the performance by NSS
of its obligations under this Article 19 and the execution, delivery and
performance by NSS of the Pledge Agreements and the Escrow Agreement will not
be in conflict with, result in a breach under or constitute a default under the
NSS Credit Agreement;

 

38

 

c.             the
Pledge Agreements and the Escrow Agreement, when executed and delivered by NSS
and Contractor (and, in the case of the Escrow Agreement, the other parties thereto),
will constitute legal, valid and binding obligations of NSS, enforceable
against NSS in accordance with their terms (subject to (i)
the effects of bankruptcy, insolvency, moratorium, reorganization, fraudulent
conveyance or other similar laws affecting creditors’ rights generally, (ii)
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law) and (iii) implied covenants of
good faith and fair dealing);

 

d.             no
action, consent or approval of, registration or filing with or any other action
by any Governmental Authority is or will be required to give effect to this
Article 19 or to the Pledge Agreements, other than (i)
recordation of the Pledge Agreements (which, if required, NSS shall do within
ten (10) Business Days after execution of the Pledge Agreements), (ii) such
consents, approvals, registrations, and filings as may be required in
connection with Contractor’s exercise of its rights under the Pledge Agreements
following an Event of Default and (iii) such actions, consents or approvals the
failure of which to be obtained or made could not reasonably be expected to
have a Material Adverse Effect;

 

e.             except
for any consents or approvals (i) required under the
NSS Credit Agreement (all of which consents and approvals shall have been
obtained upon the effectiveness of the NSS Credit Agreement Amendment (as
described in clause (b) above) and (ii) by any Governmental Authority, as
referred to in clause (d) above, no consents or approvals of any other person
are required in connection with the performance by NSS of its obligations under
Article 19 and the execution, delivery, performance, validity or enforceability
of the Pledge Agreements and the Escrow Agreement, other than consents or approvals
the failure of which to be obtained or made could not reasonably be expected to
have a Material Adverse Effect; and

 

f.              upon
the effectiveness of the NSS Credit Agreement Amendment (as described in clause
(b) above), the performance by NSS of its obligations under this Article 19 and
the execution, delivery and performance by NSS of the Pledge Agreements and the
Escrow Agreement will not be in conflict with, result in a breach under or
constitute a default under any agreement to which NSS is a party, where any
such conflict, breach or default could reasonably be expected to have a
Material Adverse Effect.

 

39

 

2.             General
Covenants.  NSS covenants and agrees
with Contractor that, from the date of this Contract and throughout the
Security Period (as defined in each Pledge Agreement), NSS will:

 

a.             not sell, transfer,
lease or otherwise dispose of the Spacecraft, except that this provision shall
not prohibit Permitted Spacecraft Disposals;

 

b.             not
voluntarily sell, lease, transfer, assign or otherwise dispose of the Orbital
Station without the prior written consent of Contractor, unless NSS has rights
to use (and will use) an alternative orbital location for the Spacecraft and
the operation of the Spacecraft from such other orbital location will not
constitute a Material Adverse Effect.

 

c.             not
sell, transfer, lease or otherwise dispose of, and not settle, compromise,
discount, waive or extend the payment dates in relation to, any Accounts
Receivable, except that this provision shall not prohibit Permitted Receivables
Disposals, subject to compliance with Paragraph 19.B.3;

 

d.             not
permit to exist any mortgage, deed of trust, lien, hypothecation, pledge,
encumbrance, charge of security interest (collectively, “Liens”) on the
Spacecraft or the Accounts Receivable other than Permitted Liens, subject to
compliance with Paragraph 19.B.3;

 

e.             use reasonable
commercial efforts to comply in all material respects with any authorization
necessary for the operation of the Spacecraft;

 

f.              use
reasonable commercial efforts to maintain and preserve the Spacecraft and any
property (including, but not limited to, data and software) required for the
operation of the Spacecraft in good repair, working order and condition and
furnish written notice to Contractor of any material loss of or damage to the
Spacecraft within one (1) Business Day following such material loss or damage;

 

g.             pay
and discharge promptly when due all material obligations that, if unpaid, could
reasonably be expected to give rise to a Lien upon the Spacecraft, other than
Liens permitted under clause (d) above;

 

40

 

h.             upon
request from Contractor, execute such further documents and take all such
further actions as may reasonably be required to perfect Contractor’s rights
under the Pledge Agreements;

 

i.              notify Contractor
(x) promptly of any events or circumstances which could reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect or (y)
within one (1) Business Day of receipt, of any notice received by NSS from the
administrative agent under the NSS Credit Agreement following an event of
default under the NSS Credit Agreement of the administrative agent’s intention
to exercise any acceleration or enforcement remedies available to it under the
NSS Credit Agreement; and

 

j.              not
take any corporate action with a view to its being voluntarily resolved or
entering into a merger (fusie),
de-merger (splitsing)
or division (afsplitsing),
except where such action (i) could not reasonably be
expected to have a Material Adverse Effect or (ii) is consented to by
Contractor (which consent shall not be unreasonably withheld, conditioned or
delayed), taking into consideration the amount of the Remaining Payments.

 

3.             Covenants
Relating to “Lock-Box” Account; Direction of Accounts Receivable.

 

a.             Payments.  To the extent that NSS fails to make one (1)
or more payments as and when due under Paragraph 5.C.2 or 5.D which are
undisputedly due and payable or in dispute but due and payable into an escrow
account under Paragraph 5.E for an aggregate amount in excess of XXX Dollars ($XXX) within thirty (30) days following the date on which any
such payment or payments become due under this Contract (any such failure, a “Payment
Default”), Contractor may by written notice, at any time following the
occurrence and during the continuance of such Payment Default, instruct NSS to,
at Contractor’s option, either direct a sufficient number of NSS-8 Customers to
(i) make payments as and when due under one (1) or
more Customer Contracts directly into a bank account that is encumbered by a
first right of pledge in favor of Contractor (any such account, a “Lock-Box
Account”) to the extent necessary to cause the aggregate amount standing to the
credit of such bank account (plus any minimum balance required by the relevant
banking institution) to equal the amount of the Payment Default and from which
Contractor can directly deduct amounts necessary to cure such Payment Default
or (ii) make payments as and when due under

 

41

 

one
(1) or more Customer Contracts directly to Contractor in an aggregate amount
equal to the amount of the Payment Default. 
NSS may revoke such directions with respect to any particular Customer
Contract so long as it has given equivalent directions with respect to other
Customer Contracts as necessary to maintain compliance with its obligations
under this clause (a) (such maintenance of compliance, “Customer Contract
Coverage Maintenance”).  Following
receipt of any such written notice, and to the extent necessary for Customer
Contract Coverage Maintenance, NSS shall promptly so instruct sufficient NSS-8
Customers.

 

b.             In
the event that NSS defaults under the NSS Credit Agreement and such default
results in the acceleration of the maturity of the loans under the NSS Credit
Agreement (an “NSS Credit Agreement Acceleration”), Contractor may by written
notice instruct NSS to direct all NSS-8 Customers to make payments as and when
due under the Customer Contracts into a Lock-Box Account, from which Contractor
can directly deduct amounts that are undisputedly due and payable as and when
due and payable under Paragraph 5.C.2 or 5.D, or transfer amounts that are in dispute
into an escrow account under Paragraph 5.E as and when due under Paragraph
5.E.  Following receipt of any such
written notice, NSS shall promptly so instruct NSS-8 Customers.

 

4.             Enforcement
of Customer Contracts.  Following the
exercise by Contractor of its rights under Paragraph 19.B.3.a (and without
prejudice to NSS’s obligations thereunder),
and, in the case of the exercise by Contractor of its rights under Paragraph
19.B.3.a(i), for so long as any Payment Default
remains outstanding and, following a cure of such Payment Default, until such
time as four (4) quarterly payment dates have passed without there occurring
another Payment Default, NSS shall enforce each Customer Contract required for
Customer Contract Coverage Maintenance (or, in the case of the exercise by
Contractor of its rights under Paragraph 19.B.3.a(ii), all Customer Contracts)
in a manner that is consistent with its general business practices and shall
not amend any Customer Contract required for Customer Contract Coverage Maintenance
(or, in the case of the exercise by Contractor of its rights under Paragraph
19.B.3(a)(ii), any Customer Contracts) or relieve any affected NSS-8 Customer
of its obligations thereunder in a manner that
inequitably impairs Contractor’s right to receive payments under Paragraph
19.B.3(a), Paragraph 5.C.2 and Paragraph 5.D, as applicable.

 

42

 

5.             Rights
and Obligations Following a Cure. 
For the avoidance of doubt, when a Payment Default is no longer outstanding
and four (4) quarterly payment dates have passed without there occurring
another Payment Default, NSS’s obligations under this
Paragraph 19.B.3 (other than its obligations under Paragraph 19.B.3.a(ii) and
its obligations under Paragraph 19.B.3.b, to the extent they relate to an
exercise by Contractor of its rights under Paragraph 19.B.3.a(ii)) shall cease
to exist and NSS may withdraw or otherwise use, in its sole discretion, any
amounts remaining in a Lock-Box Account; shall no longer be required to maintain
a Lock-Box Account; and, subject to compliance with the provisions of this
Article 19 and the Pledge Agreements, may deal with all NSS-8 Customers in such
manner as it determines in its sole discretion. 
Nothing in this clause (c) shall prejudice Contractor’s rights under
Paragraph 19.B.3(a) with respect to any subsequently
occurring Payment Default.

 

6.             Covenant
Relating to Prepayment of Term Loans Under the NSS
Credit Agreement.  NSS undertakes
that, as soon as practicable following its receipt from Contractor of the
refunded amounts of the Milestone Payment Plan referenced in Section 2.3(a) of
the MOU, it shall apply such portion thereof towards prepayment of outstanding
term loans under the NSS Credit Agreement as is required so as to ensure that
the NSS Credit Agreement Amendment becomes effective within twenty-four (24)
hours of receipt by NSS of such refunded amounts.

 

C.            Events
of Default; Cure

 

1.             Events
of Default.  Each of the following
shall constitute an Event of Default under this Article 19 and the Pledge
Agreements: NSS shall (i) fail to observe or perform
in any material respect its obligations under any covenant contained in
Paragraph 19.B.3(a), Paragraph 19.B.3(b) or Paragraph
19.B.4 or (ii) fail to cure any Payment Default within XXX (XXX)
days by providing sufficient Customer Contract Coverage Maintenance;

 

b.             At
any time following the occurrence and during the continuance of a Payment
Default, there occurs an NSS Credit Agreement Acceleration;

 

c.             Any
representation or warranty made by NSS in Paragraph 19.B.1, in Paragraph 25.A
or in Clause 4.1 of either Pledge Agreement shall prove to have been false or
misleading in any material respect when so made by NSS and, in the case of the
representation and warranty set forth in Paragraph 19.B.1.(d), NSS shall

 

43

 

fail
promptly to make or obtain any required action, consent, approval, registration
or filing upon becoming aware of the need therefore and such failure shall have
a Material Adverse Effect;

 

d.             NSS
shall fail to observe or perform in any material respect its obligations under
any covenant contained in Paragraph 19.B.2 or Article 5 of either Pledge
Agreement or any of its other material obligations under this Article 19 (other
than any obligation referred to in clause (a) above) and the Pledge Agreements
and such failure, if capable of remedy, shall continue unremedied
for a period of thirty (30) days; provided that, in the case of a
failure to observe or perform in any material respect its obligations under
Paragraph 19.B.2(f) after the occurrence of an NSS Credit Agreement
Acceleration, NSS shall provide reasonable assurances that such failure is
capable of remedy;

 

e.             an
involuntary proceeding shall be commenced or an involuntary petition shall be
filed in a court of competent jurisdiction seeking (i)
relief in respect of NSS or of a substantial part of the property or assets of
NSS, under Title 11 of the United States Code, as now constituted or hereafter
amended, or any other federal, state or foreign bankruptcy, insolvency,
receivership or similar law, (ii) the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar
official for NSS or for a substantial part of the property or assets of NSS,
(iii) the winding-up or liquidation of NSS or (iv) the commencement of any
proceedings in The Netherlands regarding the bankruptcy (faillissement), suspension of
payments (surséance van betaling)
or dissolution (ontbinding)
of NSS; and such proceeding or petition shall continue undismissed
for sixty (60) days or an order or decree approving or ordering any of the
foregoing shall be entered;

 

f.              NSS
shall (i) voluntarily commence any proceeding or file
any petition seeking relief under Title 11 of the United States Code, as now
constituted or hereafter amended, or any other federal, state or foreign
bankruptcy, insolvency, receivership or similar law, (ii) seek, or consent to,
the institution of, or fail to contest in a timely and appropriate manner, any
proceeding or the filing of any petition described in paragraph (e) above,
(iii) apply for or consent to the appointment of a receiver, trustee,
custodian, sequestrator, conservator or similar
official for NSS or for a substantial part of the property or assets of NSS, (iv)
file an answer admitting the material allegations of a petition filed against
it in any such proceeding, (v) make a general assignment for the

 

44

 

benefit
of creditors or (vi) become unable, admit in writing its inability or fail
generally to pay its debts as they become due.

 

; provided, with respect to (i)
the events and circumstances described in clauses XXX (other than as provided in clause (ii) of this proviso)
above, that within XXX (XXX) days and (ii) the events and
circumstances described in clause (XXX)
above, XXX, that within XXX (XXX)
days, in each case after receiving written notice from Contractor stating the
nature and extent of the claimed default and Contractor’s intent to exercise
one or more of its remedies hereunder as a result of the default (which notice
may be given by Contractor at any time following the occurrence of any of the
events described in clauses (a) through (f) above and shall specify which
remedies Contractor intends to exercise) NSS shall have failed to either (x)
cure the default, (y) dispute the existence of a default under Article 21 or
(z) provide other comparable security that is acceptable to Contractor in its
reasonable discretion, taking into consideration the amount of the Remaining
Payments.  Notwithstanding any prior
allocation by NSS of Prepayments and Price Adjustments under Paragraph 4.C, NSS
may cure an Event of Default by re-allocating any Prepayments and/or Price Adjustments
which haven’t been previously effected to the past due amount.

 

D.            Contractor’s
Remedies Following an Event of Default

 

1.             Payment
and Exercise of Pledges.  At any time
following the occurrence and during the continuance of an Event of Default
(other than an event of default with respect to the events and circumstances
described in Paragraph 19.C.1(e) or Paragraph 19.C.1(f)), Contractor may
declare the sum of all future payments due to Contractor under Article 4 to be
forthwith due and payable in whole or in part (subject to refunds in the event
of a future Price Adjustment) and may, subject to Paragraph 19.D.4, exercise
any or all rights and remedies available under the Pledge Agreements and under
this Article 19.  Upon the occurrence of
an Event of Default under Paragraph 19.C.1(e) or Paragraph
19.C.1(f), the sum of all future payments due to Contractor under Article 4
shall immediately become due and payable in whole (subject to refunds in the
event of a future Price Adjustment) and Contractor may, subject to Paragraph
19.D.4, exercise any or all rights and remedies under the Pledge Agreements and
under this Article 19.

 

2.             Additional
Rights of Contractor following Enforcement of the Spacecraft Pledge Agreement.  At
any time following the exercise by Contractor of its

 

45

 

rights
and remedies under the Spacecraft Pledge Agreement, Contractor may by written
notice instruct NSS to do, and NSS shall use commercially reasonable efforts to
do, any one or more of the following in accordance with the instructions of
Contractor:

 

a.             Continue
performing TT&C operations for the Spacecraft at the Orbital Station for a
fixed monthly fee based on the material and efforts involved in providing such
services plus a profit component of XXX
percent (XXX%).  NSS shall perform
TT&C operations on commercially reasonable terms and conditions;

 

b.             Subject
to the requirements set forth in Article 21 of the Spacecraft Pledge Agreement,
effect the transfer of operational control over the Spacecraft to Contractor or
to a qualified third-party designated by Contractor and transfer to Contractor
or such third party: (i) any access codes, command
codes, command encryption keys and related manuals and documentation reasonably
necessary to establish access to and perform tracking, telemetry, control and
monitoring (“TTC&M”) of the Spacecraft, including activation and control of
any spacecraft subsystems and payload components and the transponders thereon, taking into consideration NSS’s
then-current procedures and practices for performing TTC&M (and including,
without limitation NSS’s procedures for performing
TTC&M of the Spacecraft, or “PROCS”); and (ii) such Spacecraft’s
configuration, loading and other information as may be reasonably required by
Contractor in order to continue providing services to NSS-8 Customers, taking
into consideration NSS’s then-current procedures and
practices for providing services to NSS-8 Customers.  NSS shall also grant to Contractor an
irrevocable (subject to the
limitations provided for herein), non-exclusive, royalty free, worldwide
license (which Contractor may sublicense to any qualified third party) to use
the NSS codes, documentation, procedures and information provided under this
clause (b) solely for the purpose of performing TTC&M of the Spacecraft and
continuing to provide services to NSS-8 Customers.  For the avoidance of doubt, this provision
shall apply only to codes, documentation, procedures and information generated
and maintained by NSS and shall not apply to any hardware or to any third-party
data, software or documentation, XXX.  Any
codes, documentation, procedures and information provided pursuant to this
clause (b) shall be treated as NSS Proprietary Information under Article 27;
Contractor agrees to accept such codes, documentation, procedures and
information on an “as is” basis and NSS expressly disclaims any express or
implied warranties, including without limitation warranties of fitness for any
particular purpose and merchantability; and shall be subject to the
provisions of Article 31

 

46

 

hereof.  Notwithstanding anything in the foregoing to
the contrary, Contractor shall not be allowed to take any action, and NSS shall
not be required to take any action, that, in NSS’s
sole opinion, would impair or threaten to impair the continued operation of any
other satellite owned or operated by NSS or otherwise materially and adversely
affect any asset of NSS other than the Spacecraft.  As used herein, a “qualified third party”
shall mean any third party who (x) is qualified, in Contractor’s reasonable
discretion, to perform TTC&M for the Spacecraft and provide services to the
NSS-8 Customers and (y) is not an owner and operator of a fixed satellite
services (FSS);

 

c.             At
Contractor’s request, either (i) make available to
Contractor through a sublicense or other lawful arrangement NSS’s
rights to make use of the orbital location and associated radio frequencies at
which the Spacecraft is then operating for the shorter of the Spacecraft’s
then-remaining Orbital Design Life or until all incentive payments and interest
due to Contractor under this Contract have been paid in full, for an annual fee
of no more than XXX ($XXX) or (ii) assist Contractor in obtaining
a license or other authorization from the Government of The Netherlands
pursuant to which Contractor would be able to make use of the orbital location
and associated radio frequencies at which the Spacecraft is then operating
during period set forth in clause (i).

 

3.             Additional
Rights of Contractor following Enforcement of the Receivables Pledge Agreement.  At any time following the exercise by
Contractor of its rights and remedies under the Receivables Pledge Agreement by
sending a Default Notice (as defined in the Receivables Pledge Agreement) (so
long as Contractor has not exercised its rights and remedies under the
Spacecraft Pledge Agreement), NSS shall, at Contractor’s written request, use
commercially reasonable efforts to, provide sales, marketing, billing,
collection and related services for NSS-8 Customers and prospective customers
at the orbital location.  Pricing for
such services shall be based on the material and efforts involved in providing
the services plus a profit component of XXX
percent (XXX%).

 

4.             Obligations
of Contractor.  Prior to exercising
the Spacecraft Pledge Agreement, Contractor must exercise the Receivables
Pledge Agreement by sending a Default Notice (as defined in the Receivables
Pledge Agreement).  Contractor shall have
the right to control the Spacecraft, including the right to relocate the
Spacecraft from the orbital location, only after Contractor has exercised its
enforcement rights under the Receivables Pledge Agreement and the Spacecraft
Pledge Agreement.

 

47

 

After exercising the Spacecraft
Pledge Agreement, (1) Contractor shall be solely responsible for the command
and control of the Spacecraft unless Contractor elects, pursuant to Paragraph
19.D.2(a), to have NSS continue to operate the Spacecraft, in which case NSS
shall continue to operate the Spacecraft pursuant to Paragraph 19.D.2(a) and
comply with its obligations under Customer Contracts; and (2) Contractor shall
be solely responsible for any decision to relocate the Spacecraft from the orbital
location; provided, that Contractor shall not be so responsible if (x)
NSS has not complied with its obligations under Paragraph 19.D.2(c) or (y) such
relocation is required pursuant to an order issued by the government of The
Netherlands or another Governmental Authority with jurisdiction over the
Spacecraft or the orbital location.

 

E.             Termination
of Security Interest and Substitution of Collateral  

 

1.             Termination
of Security Interest.  The provisions
of this Article 19 and the Pledge Agreements each shall terminate in their
entirety, and NSS shall have no further obligations hereunder or thereunder, when NSS has unconditionally and irrevocably
(other than as provided in Paragraph 5.C.3) paid all but the last XXX Dollars ($XXX) in incentive payments hereunder.

 

2.             Substitution
of Collateral.  At any time when XXX Dollars ($XXX) or less in incentive payments remains due to Contractor
under this Contract, NSS may seek Contractor’s consent to provide alternative
security, which consent may not be unreasonably withheld, conditioned or
delayed taking into consideration the amount of the Remaining Payments, the
adequacy of the alternative security offered to secure the remaining incentive
payments and interest, NSS’s general
creditworthiness, and other commercially reasonable factors.

 

F.             Taxes

 

Contractor
shall be solely responsible for any and all taxes, duties, spectrum use,
regulatory, licensing and other fees arising from its exercise of its rights
under this Article 19 or under the Pledge Agreements, including without
limitation import duties.

 

G.            Remedies
Cumulative

 

The
rights, powers and remedies of Contractor under this Article 19 are cumulative
and shall be in addition to, and without prejudice to, all rights, powers and
remedies available to Contractor pursuant to the Pledge Agreements and at law,
in 

 

48

 

equity
or by statute.  All such rights, powers
and remedies may be exercised successively or concurrently without impairing
the rights of Contractor hereunder.

 

ARTICLE 20.  KEY PERSONNEL

 

It
is agreed that the following Contractor employees and positions are necessary
for the successful performance of this Contract:

 

	
  Key Personnel

  	
   

  	
  Position

  
	
  Mike Neuman

  	
   

  	
  Chief
  Engineer

  
	
  Ron
  Dukat

  	
   

  	
  Program
  Manager

  
	
  Douglas
  Anders

  	
   

  	
  Deputy
  Program Manager

  
	
  David
  Grey

  	
   

  	
  Lead
  Payload Engineer

  
	
  Michelle
  Parker

  	
   

  	
  Systems
  Lead

  
	
  Alain
  Sanchez

  	
   

  	
  Lead
  Bus Engineer

  
	
  Dennis
  Beeson

  	
   

  	
  Contracts
  Manager

  
	
  Jeanine
  Hoffmann

  	
   

  	
  Ground
  Systems Lead

  
	
  Mickey
  Diesman

  	
   

  	
  PA
  Manager

  
	
  Charles
  Park

  	
   

  	
  Antenna
  Lead

  

 

In
the event one (1) or more of the above-named personnel are no longer available
for the performance of this Contract, Contractor agrees to replace such
personnel with personnel of a comparable level of experience, qualifications
and ability, and such replacement shall be subject to NSS’ approval.

 

ARTICLE
21.  DISPUTES

 

A.            Disputes

 

Any
dispute or disagreement arising between Contractor and NSS in connection with
this Contract, which is not settled within thirty (30) days (or such longer period
as may be mutually agreed upon by the Parties) from the date that either Party
notifies the other in writing that such dispute or disagreement exists (or
within the time periods specified in Paragraph 21.B with respect to technical
matters), at the request of either Party shall be settled under the Rules of
Conciliation and Arbitration of the International Chamber of Commerce, in
effect on the date that such request is made, by three (3) arbitrators.  Each Party shall select one (1) arbitrator
and the two (2) arbitrators so selected shall select the third (3rd)
arbitrator; provided that if the two (2) arbitrators 

 

49

 

selected by the Parties cannot
agree on a third arbitrator within thirty (30) days of their selection by the
Parties, the third arbitrator shall be appointed in accordance with the Rules
of Conciliation and Arbitration.  The
arbitration proceedings shall be conducted in the United Kingdom.  The arbitration resolution shall be final and
binding upon the Parties and judgment may be entered thereon, upon the
application of either Party, by any court having jurisdiction.  Each Party shall bear the cost of preparing
and presenting its case; and the cost of arbitration, including the fees and
expenses of the arbitrators, will be shared equally by the Parties unless the
resolution otherwise provides.

 

B.            Disagreements
Regarding Technical Matters

 

The
Parties acknowledge their shared interest in ensuring that the Spacecraft is
delivered by the Promised Delivery Date and is constructed and tested so as to
ensure that it performs in accordance with the requirements of the Contract,
including the Exhibits hereto.  In
recognition of this shared interest, the Parties agree to cooperate in good
faith and to expedite, to the maximum extent technically and commercially
reasonable, the resolution of any dispute or disagreement arising between
Contractor and NSS related to the disposition of test or other anomalies or
other technical matters.  If there is a
disagreement between the Parties regarding the foregoing, the Parties shall
expedite resolution of a “go forward” plan as follows:

 

1.             Program
Managers.  Contractor’s program
manager shall discuss the issue (and shall provide sufficient relevant
technical information, including test data, and make available other relevant
personnel including the appropriate subject matter experts) with NSS’ on-site
program manager.  If the matter has not
been resolved to either Party’s satisfaction within twenty-four (24) hours, then

 

2.             Chief
Technology Officer.  Contractor or
NSS each may escalate the matter to Contractor’s Chief Engineer and to NSS’
Chief Technology Officer (and, as above, Contractor shall provide sufficient
relevant technical information, including test data, and make available other
relevant personnel including the appropriate subject matter experts).  If the matter has not been resolved to either
Party’s satisfaction within forty-eight (48) hours, then

 

3.             CEOs.  Contractor or NSS each may escalate the
matter to Contractor’s General Manager and to NSS’ Chief Executive Officer
(and, as above, Contractor shall provide sufficient relevant technical
information, including test data, and 

 

50

 

make
available other relevant personnel including the appropriate subject matter
experts).  If the matter has not been
resolved to either Party’s satisfaction within forty-eight (48) hours, then (a)
a dispute shall be deemed to exist under the Contract and either Party may
unilaterally submit the matter to arbitration in accordance with Paragraph 21.A
and (b) upon request from NSS (which must be made, if at all, within five (5)
Business Days), Contractor shall provide a Contract Change Notice, which shall
specify the terms for performing the disputed work (including, but not limited
to, price and schedule impact).

 

ARTICLE 22.  INDEMNIFICATION

 

A.            General
Indemnification

 

XXX shall indemnify and hold XXX,
its officers, directors, agents, employees, owners, subsidiaries, affiliates, successors
and assigns, or any of them, harmless from any and all loss, damage, liability
or expense resulting from damage (excluding damage to the Spacecraft caused
after Acceptance) and injuries, including death, to all persons (natural or
juridical), arising from any occurrence caused by a material act or omission of
XXX or any of them, and XXX shall at its sole expense defend any
claims, actions, suits and proceedings, whether in law or equity, brought
against XXX, its officers,
directors, agents, employees, owners, subsidiaries, affiliates, successors and
assigns, or any of them, on account thereof, and shall pay all expenses,
including attorney’s fees, and satisfy all judgments as may be incurred by or
rendered against them, or any of them, in connection therewith, provided XXX is given prompt notice of any such
claim, action, suit or proceeding.  XXX shall provide, at XXX written request and sole expense, such
assistance and information as may be reasonably provided by XXX in connection with the defense of any
such action.  Notwithstanding the
foregoing, for the period commencing at Intentional Ignition through Spacecraft
separation from the Launch Vehicle, Contractor shall indemnify NSS for damages
caused by the nonperformance of the Launch Services only to the extent that the
Launch Services Provider provides such indemnity under the Launch Services
Agreement as long as (i) Contractor does not amend
its Launch Services Agreement with Sea Launch after the date of this Agreement
to reduce or limit the indemnity provided by Sea Launch thereunder
and (ii) any new Launch Services Agreement entered into by Contractor contains
indemnification provisions that are at least as favorable to Contractor (and
NSS) as those contained in Contractor’s Launch Services Agreement with Sea
Launch as of the date of this Contract.

 

51

 

B.            Intellectual
Property Indemnification

 

XXX shall, at its expense, defend, indemnify and hold XXX,
its officers, directors, agents, sublicensees,
owners, subsidiaries, affiliates and employees, successors or assigns or any of
them harmless from and against any and all claims, losses, actions, damages,
expenses and all other liabilities, including but not limited to costs and
reasonable attorneys’ fees, resulting from any claim against an indemnified
party by any third party, for infringement or other violation of any patent,
copyright, trademark, trade secret rights, or any other intellectual property
rights arising from preparing, launching, testing, maintaining, operating,
using, and marketing capacity on or services that employ the Spacecraft or in
connection with any Item; the performance of Work; or any Contract Technology
owned by XXX and/or licensed by XXX to XXX
under this Contract.

 

If
an injunction or other order is obtained against the manufacture, preparation,
use, lease, sale or other disposition of any deliverable Item, Contractor
agrees to use its best efforts either to procure rights so that such
deliverable Item and the manufacture, preparation, use, lease, sale or other
disposition thereof is no longer infringing or to modify or replace such
deliverable Item, subject to NSS’ technical approval, so that it is no longer
subject to such injunction or order.  In
the event that neither of the foregoing alternatives is suitably accomplished, XXX shall be liable to XXX, its successors and assigns, or any of
them, for all additional costs and damages resulting from such injunction or
order.

 

C.            Indemnification
for Taxes

 

Contractor
shall assume responsibility for, and shall hold NSS harmless from all taxes,
duties (except for import duties related to Items delivered to NSS, or Services
performed for NSS, in The Netherlands), tariffs or similar charges, however
denominated, which may be required under any present or future law or laws, and
which become due by reason of the performance of Work under this Contract or
any Subcontract hereunder, and shall execute and deliver such other further
instruments, and comply with such requirements of said laws, as may be
necessary thereunder to confirm and effectuate this
Contract, including making of payment of any interest or penalties related to
or arising from such taxes, duties, tariffs or other charges.

 

52

 

D.            Procedures

 

In
the event XXX employs any
attorney, accountant, engineer or consultant to assist in defense of any matter
pursuant to this Article 22, such attorney, accountant, engineer or consultant
shall be reasonably satisfactory to the indemnified party.  If XXX
does not employ counsel to take charge of the defense, the indemnified party
shall, at the sole expense of XXX,
employ separate counsel and direct such defense on its own behalf.  No settlement of any claim, action,
proceeding or suit shall admit liability on the part of an indemnified party
without such indemnified party’s prior written consent, which may be given or
withheld in an indemnified party’s sole discretion.

 

ARTICLE 23.  LIMITATION OF LIABILITY

 

NOTWITHSTANDING
ANY OTHER PROVISION HEREIN TO THE CONTRARY, NEITHER PARTY SHALL BE LIABLE,
WHETHER IN CONTRACT, TORT OR OTHERWISE, FOR SPECIAL, INCIDENTAL, INDIRECT OR
CONSEQUENTIAL DAMAGES OR FOR LOST PROFITS OR REVENUES, OTHER THAN FOR A WILLFUL
BREACH OR GROSS NEGLIGENCE.  THE FOREGOING
LIMITATIONS SHALL NOT APPLY TO A PARTY’S OBLIGATIONS TO INDEMNIFY A THIRD PARTY
CLAIM PURSUANT TO ARTICLE 22 OR ANY OTHER PROVISIONS OF THIS CONTRACT RELATING
TO INDEMNIFICATION OF A THIRD PARTY CLAIM.

 

ARTICLE 24.  DAMAGE TO PERSONS OR PROPERTY,
ASSOCIATED WITH LAUNCH, INTERPARTY WAIVER

 

Each
Party agrees to be bound to such interparty waiver as
the Launch Services Provider may set forth in the Launch Services Agreement,
provided that the waiver contains reciprocal rights for both Parties and is
substantially consistent with the standard provisions of such Launch Services
Provider.

 

ARTICLE 25.  REPRESENTATIONS AND WARRANTIES

 

A.            Mutual
Representations and Warranties

 

Each
Party represents, covenants and warrants to the other that:

 

1.             Existence.  It is a corporation, duly organized and
validly existing and with the power to undertake the obligations set forth in
this Contract.

 

53

 

2.             Authority.  All corporate action required to be taken by
it to execute, deliver and perform the terms of this Contract have been taken.

 

3.             Binding
Agreement.  The execution and
delivery of this Contract by it will cause this Contract to constitute a legal,
valid and binding obligation of it enforceable in accordance with its terms,
except where enforceability thereof may be limited by bankruptcy, insolvency,
reorganization, or other similar laws affecting the enforcement of creditors rights generally or general principles of equity.

 

B.            Contractor’s
Special Representations and Warranties

 

Contractor
represents, covenants and warrants to NSS that:

 

1.             Contract
Intellectual Property.  None of the
Contract Intellectual Property is, to the best of Contractor’s knowledge, the
subject of infringement or other violations of intellectual property
protections by any third party; and all of the Contract Intellectual Property
is free from any lien, claim or other encumbrance, including as a pledge of
collateral.  Contractor shall employ all
reasonable commercial efforts to retain all Contract Intellectual Property.

 

2.             Contract
Technology.  There are no claims
filed, or, to the best of Contractor’s knowledge, threatened that any of the
Contract Technology or the practice thereof infringe or violate in any way any
Patent or other intellectual property rights of any third party.  Contractor has the authority to grant to NSS
the licenses and rights to the Contract Technology according to the terms of
this Contract.

 

ARTICLE 26.  ASSIGNMENT

 

Neither
this Contract nor any of the rights, duties, and obligations of Contractor or
NSS under this Contract may be assigned or delegated by either Party without
the prior written consent of the other Party, not to be unreasonably withheld,
conditioned or delayed.  Any attempted
assignment or delegation, without such consent, shall be void and without
effect.  Notwithstanding the foregoing,
NSS may assign this Contract or any of its rights and obligations, including
but not limited to any warranties, security agreements and indemnities,
with a right to reassign, without Contractor’s consent: (i)
to a subsidiary of NSS, or (ii) to a joint venture in which NSS is a majority
participant or holds at least a twenty-five percent (25%) ownership interest;
and either Party may assign this Contract or any of its rights and obligations,
including but not limited to any 

 

54

 

warranties and indemnities,
with a right to reassign without consent of the other Party (x) to any entity
that acquires or succeeds, by merger or other vehicle, to all or substantially
all of the assigning Party’s assets, or (y) to a financial institution as
security in connection with a bona fide financing transaction in accordance
with the terms of Article 19 herein.  Any
assignment of the Contract shall not relieve the assignor of its obligations
hereunder unless the assignor provides the other Party with reasonable evidence
of the financial viability of the assignee, which evidence is reasonably
acceptable to such other Party, or unless such other Party otherwise agrees to
release the assignor of its obligations hereunder.  NSS shall not assign this Contract in any
manner that materially impairs Contractor’s rights under the Pledge Agreements.

 

This
Contract shall be binding upon and inure to the benefit of the Parties and
their respective permitted successors and assigns.

 

ARTICLE 27.  CONFIDENTIALITY

 

A.            Identification
of Proprietary Information

 

All
information, in whatever form, orally or in any written or electronic form,
that has been or may be disclosed in the future by one Party to the other in
connection with this Contract shall be deemed proprietary information, if
written, if marked “proprietary” or “confidential,” or if disclosed orally, if
so stated to the receiving Party by the disclosing Party at the time of
disclosure and reduced to writing no later than thirty (30) days after the
disclosure (together “Proprietary Information”).  In addition, and without limitation,
Contractor acknowledges and agrees that all information regarding NSS’ contemplated
use of or customers for the Spacecraft, areas of coverage or antenna plots,
potential types of traffic or related requirements, health and expected life of
existing satellites, the performance of the Spacecraft and any anomalies with
respect thereto, and all information that could be revealing of the foregoing,
shall be deemed NSS’ Proprietary Information and “Company Restricted
Information.”

 

B.            Restrictions
on Use, Disclosure

 

Neither
Party shall use the Proprietary Information of the other Party except for the
purpose of this Contract.  Neither Party
shall disclose the Proprietary Information of the other Party except:  (1) on a confidential and need-to-know (for
the purposes specified herein) basis to its employees, agents, and advisors
(and with respect to NSS, its insurance underwriters, launch service providers,
investors, lenders and TT&C 

 

55

 

operators), each of whom shall
be subject to comparable restrictions of confidentiality; (2) as to information
that is already rightfully in the possession of the receiving Party through
other means and without such confidentiality restrictions; (3) as to
information that is required to be disclosed under applicable law or by a valid
subpoena or other court or governmental order, decree, regulation or rule;
provided, however, that if disclosure is required under this provision, the
receiving Party shall advise the disclosing Party of the requirement to
disclose Proprietary Information prior to such disclosure and as soon as
reasonably practicable after the receiving Party becomes aware of such required
disclosure; and further provided that upon the request of the disclosing Party,
the receiving Party agrees to cooperate in good faith and at the expense of the
disclosing Party in any reasonable and lawful actions which the disclosing
Party takes to resist such disclosure, to limit the information to be disclosed
or to limit the extent to which the information so disclosed may be used or
made available to third parties; (4) as to information that is released for
public disclosure by the disclosing Party; (5) as to information that is
developed by the receiving Party independently of any Proprietary Information
of the disclosing Party.  Notwithstanding
any other rights of either Party, either Party may seek injunctive relief in
any court of competent jurisdiction against improper use or disclosure of
Proprietary Information.

 

C.            Company
Restricted Information

 

In
addition to the obligations set forth above, Contractor agrees that its
disclosure of Company Restricted Information under Paragraph 27.B. above shall
be limited to individuals within the Boeing Satellite Systems (BSS) business
unit of Contractor who have no responsibility for, or participation in, any venture
in which Contractor may have any interest that involves the direct sales and/or
leasing of satellite transponder capacity or the provision of any satellite
communications services, including any individuals who may have dual roles.  Contractor employees outside Contractor’s
business unit who have responsibility for evaluation and oversight of BSS’
operations will be provided Company Restricted Information only to the extent
required for performance of their duties and only after they are advised of their
responsibilities under this Contract.

 

56

 

D.            Standard
of Care

 

Each
Party agrees to exercise a level of care consistent with that employed by said
Party for its most highly restricted and proprietary Information to ensure
compliance with its obligations stated herein.

 

E.             Property
of Disclosing Party

 

Proprietary
Information shall be deemed the property of the disclosing Party and, upon
request, the receiving Party shall return or destroy all Proprietary Information
received from the disclosing Party, including any compilations thereof, to the
extent that either may be in tangible form.

 

F.             Confidential
Treatment of MOU Terms

 

Each
Party shall treat the terms of the MOU (as incorporated into this Contract) as
confidential and shall not disclose such terms to a third party (other than
such Party’s shareholders and to legal and financial advisors, on a
confidential basis, or as may be required to comply with a Party’s legal
reporting obligations) without the prior consent of the other Party.  To the extent permitted by law, prior to
making any disclosure of the terms or conditions of the MOU that is required to
comply with a Party’s legal reporting obligation (other than disclosures that
have previously been made in accordance with this Paragraph 27.F), the
disclosing Party shall provide at least twenty-four (24) hours’ prior notice of
the disclosure (together with draft text) to the other Party.  The Parties intend to use reasonable
commercial efforts to ensure that any permitted disclosures are as limited as
possible, subject to either Party’s legal reporting obligations.

 

ARTICLE 28.  PUBLIC RELEASE OF INFORMATION

 

Each
Party shall use commercially reasonable efforts to obtain the prior written
approval of the other Party, which approval shall not be unreasonably withheld,
conditioned or delayed, concerning the content and timing of news releases and
other public disclosures (including in articles, brochures, advertisements,
prepared speeches and otherwise) of any material disclosure relating to the
health or performance of the Spacecraft, including any Failures affecting or
potentially affecting the Spacecraft.

 

57

 

ARTICLE 29.  NOTICES AND REPORTS, AUTHORIZED
REPRESENTATIVES

 

All
notices and reports to be provided to NSS or Contractor under this Contract
shall be in writing, in English, and sent to NSS or Contractor by courier, by
certified mail (postage prepaid) or by facsimile (with confirmation by courier
or certified mall) at the following addresses (or to such other address as each
Party may give the other by notice to the other in accordance with this
Article 29):

 

	
  NSS:

  	
  NSS-8
  Program Office

  
	
   

  	
  Building
  S01, M/S D381

  
	
   

  	
  c/o
  Boeing Satellite Systems, Inc.

  
	
   

  	
  P.O.
  Box 92919

  
	
   

  	
  Los
  Angeles, CA 90009-2919

  
	
   

  	
  Attention:
  NSS-8 Program Manager

  
	
   

  	
  Facsimile
  No.: 1-310-426-1443

  
	
   

  	
   

  
	
  with a separate

  	
  New
  Skies Satellites B.V.

  
	
  copy sent to:

  	
  Rooseveltplantsoen #4

  
	
   

  	
  2517KR
  The Hague

  
	
   

  	
  The
  Netherlands

  
	
   

  	
  Attention:
  Vice President, Space Segment Technology

  
	
   

  	
  Facsimile
  No.: +31 70 306 4285

  
	
   

  	
   

  
	
   

  	
  New
  Skies Satellites B.V.

  
	
   

  	
  Rooseveltplantsoen # 4

  
	
   

  	
  2517KR
  The Hague

  
	
   

  	
  The
  Netherlands

  
	
   

  	
  Attention:
  General Counsel

  
	
   

  	
  Facsimile
  No.: +31 70 306 4289

  
	
   

  	
   

  
	
  CONTRACTOR:

  	
  Boeing
  Satellite Systems International, Inc.

  
	
   

  	
  P.O.
  Box 92919

  
	
   

  	
  Los
  Angeles, CA. 90009

  
	
   

  	
  Attention:
  Mr. Dennis Beeson

  
	
   

  	
  Contracts Manager

  
	
   

  	
  Bldg.
  S01, Mail Sta. D324

  
	
   

  	
  Facsimile
  No.: (310) 364-8307

  

 

For
purposes of binding each Party under provisions of this Contract, the
“Authorized Representative” of NSS shall be its a) Chief Technology Officer,
currently Dr.  Stephen Stott, or b)
General Counsel, currently Thai Rubin, or c) Vice President, Space Segment
Technology Division, currently Mr. Leroy A. Argyle, and the Authorized Representative
of Contractor shall be its Contracts Manager, currently Dennis Beeson. 

 

58

 

Each Party may change or add to
its list of Authorized Representatives by giving notice to the other Party
(signed by the notifying Party’s then-current Authorized Representative)
pursuant to the Contract notice provisions above.

 

ARTICLE
30.  OPTIONS

 

A.            Technical
Support

 

On
or before December 31, 2005, NSS
may elect to procure from Contractor up to XXX
labor months of technical support related to the control of unique Boeing 702
functionality.  This support would also
include consulting on NSS-developed PROC testing and participation in
associated post-test data analysis and resolution.  This support will be priced at a rate of XXX Dollars ($XXX) per month, which is equivalent to XXX Dollars ($XXX) per labor hour (in 2005 Dollars), plus any reasonable,
documented out-of-pocket costs or expenses, including without limitation
reasonable travel expenses.

 

B.            Replacement
Spacecraft

 

In
the event that after Launch and prior to Acceptance, the Spacecraft becomes a
Total Loss, NSS may, at its option exercisable within XXX days of the Total Loss event, elect to
procure a Replacement Spacecraft having the same design and specifications as
the Spacecraft.  The terms and conditions
related to the procurement of the Replacement Spacecraft shall be as set forth
in Paragraph 30.B of Amendment Number 2 to the Original Contract.

 

C.            Optional
Storage And Retest

 

1.             Storage
at Contractor’s Expense.  If the
Spacecraft has not been Launched by the Promised Delivery Date, at NSS’ option,
Contractor shall place the Spacecraft In storage at Contractor’s facilities, or
such other facilities as Contractor may arrange, which alternate facilities
must have been approved by NSS, for a period of up to XXX months. 
NSS may not terminate the Contract pursuant to Article 18 Paragraphs
1.B, 1.C, 1.D or the second clause of Paragraph 2 XXX after NSS has elected to store the Spacecraft.  Contractor shall continue to store, and
perform any necessary testing or refurbishment on, such Spacecraft, at
Contractor’s expense, until such Spacecraft is Launched, and Delivery and
Acceptance thereof has been completed under this Contract.

 

59

 

2.             Storage
at NSS’ Expense.  Following XXX storage of the Spacecraft by
Contractor, NSS may elect to direct Contractor to continue to store the
Spacecraft for an additional period of time provided that the total storage
period, including the earlier free period, does not exceed three (3)
years.  The firm fixed prices for such
storage shall be as set forth in the table below:

 

	
   

  	
   

  	
  Storage Duration

  	
   

  
	
  Optional Storage Prices

  	
   

  	
  1 Year

  	
   

  	
  2 Years

  	
   

  	
  3 Years

  	
   

  
	
  Total Storage Price*

  	
   

  	
  $

  	
  XXX

  	
   

  	
  $

  	
  XXX

  	
   

  	
  $

  	
  XXX

  	
   

  
	
  Monthly Storage Fee Adjustment

  	
   

  	
  $

  	
  XXX

  	
   

  	
  $

  	
  XXX

  	
   

  	
  $

  	
  XXX

  	
   

  

 

* Total Storage Price adjusted downward by the Monthly Storage Fee
Adjustment if Spacecraft removed from storage before completion of applicable
year

 

The
price for any refurbishment and retest of the Spacecraft after storage is
included In the above prices.

 

In
the event that NSS elects to deliver the Spacecraft to storage for any reason,
NSS shall pay Contractor the Total Price in accordance with Article 5 as though
Acceptance had been achieved on the date the Spacecraft is put into storage,
subject to any adjustments or refunds if, after the Launch of the Spacecraft,
its performance is such that Price Adjustments are appropriate pursuant to
Paragraph 4.C and Exhibit F.

 

D.            Intentionally
Omitted

 

E.             In-Orbit
Test Location

 

NSS
has exercised an option set forth in the Original Contract to require
Contractor to supply all ground facilities necessary to conduct the lOT.  The price to
supply such on ground facilities has been included as part of the Total Price.

 

ARTICLE 31.  NSS FURNISHED INFORMATION AND
PROPERTY

 

Contractor
agrees, with respect to all Information and property, including but not limited
to equipment, models and devices, furnished by NSS under this Contract:

 

A.            Title

 

That
title to such Information and property shall remain exclusively in NSS.

 

60

 

B.            Risk of Loss

 

To
assume all risk of loss or damage, reasonable wear and tear excepted,
to such Information and property while in Contractor’s or any Subcontractor’s
possession or control.

 

C.            Use

 

To
ensure that such Information and property are used solely in the performance of
the Contract.

 

D.            Taxes

 

To
be responsible for payment of all taxes which become due by reason of
Contractor’s or any Subcontractor’s possession, control or use of such
Information and property, and to comply with all requirements of said laws,
including making payment of any interest or penalties related to or arising
from such taxes.

 

E.             Encumbrances

 

To
ensure that no lien, encumbrance, pledge or other interest whatsoever attaches
to such Information and property as a result of Contractor’s or any
Subcontractor’s acts or omissions.

 

F.             Return

 

Except as may otherwise be provided in this Contract
to return such Information and property to NSS upon completion of all Work or
termination of this Contract.

 

G.            Damages

 

That in no event will NSS be liable for special,
indirect or consequential damages related to such Information and property or
arising from the use thereof.

 

ARTICLE 32.  HAZARDOUS MATERIAL
IDENTIFICATION AND MATERIAL SAFETY DATA

 

Contractor
shall comply with applicable national, state, and local laws, codes,
ordinances, and regulations (including the acquisition of licenses and permits)
in connection with any hazardous material used during Launch processing.  Contractor 

 

61

 

agrees
to provide the right to use and disclose such data relating to hazardous
materials as necessary to comply with this Article.

 

ARTICLE 33.  APPLICABLE LAWS

 

This
Contract shall be interpreted, construed and governed by the laws of the State
of New York, U.S.A., except to the extent that the conflicts of laws rules of
New York would require the application of the laws of another jurisdiction.  The United Nations Convention on the
International Sale of Goods does not apply to this Contract.

 

ARTICLE
34.  RESERVED

 

ARTICLE
35.  RESERVED

 

ARTICLE
36.  GENERAL

 

A.            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 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.

 

B.            Cumulative
Rights/Waivers

 

All
rights and remedies conferred hereunder or otherwise shall be cumulative and
may be exercised singly or concurrently. 
No delay or omission by either Party to exercise any right or power
shall impair such right or power or be construed to be a waiver thereof.  No payment of money by any person or entity
shall be construed as a waiver of any right or power under this Contract.  A waiver by any Party of any of the
covenants, conditions or contracts to be performed by the other or any breach
thereof shall not be construed to be a waiver of any succeeding breach thereof
or of any other covenants, conditions or contracts herein contained.  No change, waiver or discharge 

 

62

 

hereof
shall be valid unless in writing and signed by the Authorized Representative of
the Party against which such change, waiver or discharge is sought to be
enforced.

 

C.            Gender/Captions

 

As
used herein, the singular shall include the plural and the plural may refer
only to the singular.  The use of any
gender shall be applicable to all genders. 
The captions contained herein are for purposes of convenience only and
are not a part of this Contract.

 

D.            Relationship
of the Parties

 

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

 

E.             Construction

 

This
Contract and the Exhibits and Schedules hereto, have been drafted jointly by
the Parties and in the event of any ambiguity in the language hereof, there
shall be no inference drawn in favor of or against either Party.

 

F.             Including/Time

 

Whenever
the terms “including” or “include” are used in this Contract in connection with
a single item or a list of items within a particular classification (whether or
not the term is followed by the phrase “but not limited to” or words of similar
effect) that reference shall be interpreted to be illustrative only, and shall
not be interpreted as a limitation on, or an exclusive enumeration of the items
within that classification.  The dates
for Delivery of Items and dates and times for all other purposes under this
Contract shall be defined in relation to Greenwich Mean Time.

 

63

 

G.            Survival

 

Termination
or expiration of this Contract for any reasons shall not release either Party
from any liabilities or obligations set forth in this Contract which (i) the Parties have expressly agreed shall survive such
termination or expiration, including the obligations in Articles 9, 11, 13, 14,
15, 16, 17, 18, 21, 22, 23, 26, 27 and 28, or (ii) remain to be performed or by
their nature would be intended to be applicable following any such termination
or expiration.  In the event of any
purported termination or expiration of this Contract prior to the termination
of the Contractor’s security interest in accordance with Paragraph 19.E, the
provisions of Article 19 shall survive.

 

H.            Entire
Agreement

 

This
Contract:  (i)
consists of this document and the referenced Exhibits in Article 2 of this
Contract and the Schedules attached thereto and all RDWs
and Contract Change Notices executed by the Parties on or before the date
hereof; (ii) constitutes the entire agreement of the Parties with respect to
the subject matter hereof; and (iii) supersedes all prior correspondence, representations,
proposals, negotiations, understandings, and agreements of the Parties, oral or
written, with respect to the subject matter hereof, including without
limitation the MOU and the Original Contract. 
No addition to, deletion of, or deviation from the provisions of this
Contract shall be binding against NSS unless in writing and signed by an
Authorized Representative of NSS or against Contractor unless in writing and
signed by an Authorized Representative of Contractor.

 

64

EXHIBIT 
A

 

SPACECRAFT PERFORMANCE SPECIFICATIONS

 

 

[Entire Exhibit Redacted pursuant to 

 

U.S. International Traffic in Arms Regulation
(ITAR),

 

22 CFR 120-130]

 

 

EXHIBIT 
B

 

STATEMENT OF WORK

 

 

[Entire Exhibit Redacted pursuant to 

 

U.S. International Traffic in Arms Regulation
(ITAR),

 

22 CFR 120-130]

 

 

EXHIBIT 
C

 

PRODUCT ASSURANCE PLAN

 

 

[Entire Exhibit Redacted pursuant to 

 

U.S. International Traffic in Arms Regulation
(ITAR),

 

22 CFR 120-130]

 

 

EXHIBIT 
D

 

TEST PLAN

 

 

[Entire Exhibit Redacted pursuant to 

 

U.S. International Traffic in Arms Regulation
(ITAR),

 

22 CFR 120-130]

 

 

EXHIBIT 
E

 

ESCROW AGREEMENT

 

THIS ESCROW AGREEMENT (the “Agreement”) is made and entered into as of
this 22nd day of February, 2005, by and among New Skies Satellites B.V. (“New
Skies”), Boeing Satellite Systems International, Inc. (“BSSI”), and LaSalle
Bank National Association, a national banking association duly organized and
existing under the laws of the United States of America, with its principal
office in Chicago, Illinois (the “Escrow Agent”).

 

WHEREAS, New Skies and BSSI have entered into an amended and restated
Composite Compiled NSS-8 Spacecraft and Associated Equipment and Services
Contract (Number NSS-20-03-01) dated February 22, 2005 (the “NSS-8 Contract”)
pursuant to which, inter alia,
BSSI will provide to New Skies the NSS-8 satellite and certain related items;

 

WHEREAS, pursuant to Article 5 of the NSS-8 Contract, New Skies is to
place Thirty Million Dollars ($30,000,000.00) (the “Escrow Amount”) into escrow
pursuant to this Agreement;

 

WHEREAS, pursuant to Article 5 of the NSS-8 Contract, the Escrow Amount
is to be paid to BSSI XXX in
accordance with the NSS-8 Contract, on the conditions and subject to the
restrictions set forth in the NSS-8 Contract; and

 

WHEREAS, under certain circumstances set forth in the NSS-8 Contract
all or a portion of the Escrow Amount will be refunded to New Skies rather than
paid to BSSI.

 

NOW, THEREFORE, in consideration of the mutual
promises contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:

 

ARTICLE I

ESTABLISHMENT OF ESCROW

 

1.1           New
Skies and BSSI hereby appoint the Escrow Agent, and the Escrow Agent hereby
agrees to serve, as the escrow agent and depositary subject to the terms and
conditions set forth herein.  The Escrow
Agent shall receive the Escrow Amount and agrees to hold the Escrow Amount in a
separate and distinct account (the “Escrow Account”) which, subject to the
terms and conditions of this Agreement, will be available for disbursement upon
a draw made by BSSI at the Escrow Agent’s office in Chicago, Illinois.  The Escrow Agent shall not distribute or
release any of the Escrow Fund except in accordance with the express terms and
conditions of this Agreement.

 

 

1.2           Subsequent
to the execution of this Agreement, New Skies will deposit the Escrow Amount
with the Escrow Agent, which shall be acknowledged by New Skies, BSSI, and the
Escrow Agent.  The Escrow Amount,
together with any investment earnings thereon, shall hereinafter collectively
be referred to as the “Escrow Fund.”

 

ARTICLE II

INVESTMENT OF ESCROW FUND; INTEREST PAYMENTS

 

2.1           The
Escrow Amount shall be held in a LaSalle Enhanced Liquidity Management account
(LELM), or as may be jointly directed in writing by New Skies and BSSI. All
income earned on the Escrow Fund shall be taxable to New Skies until the
Satellite Delivery Date (as defined below) and to BSSI after the Satellite
Delivery Date and shall be credited to the Escrow Account until it is disbursed
pursuant to Section 2.3.  The Escrow
Agent shall have no responsibility for the tax consequences of this Agreement. 

 

2.2           The
Escrow Agent shall not be responsible to New Skies, BSSI or any other person or
entity for any loss or liability arising in respect of any directed investment
in Section 2.1 except to the extent that such loss or liability arose from the
Escrow Agent’s gross negligence or willful misconduct.

 

2.3           BSSI
shall provide written notice to the Escrow Agent (with a copy to New Skies) following
Delivery (as defined in the NSS-8 Contract) of the NSS-8 satellite to New Skies
by BSSI, which shall state the date on which Delivery occurred (the “Satellite
Delivery Date”).  From the date of this
Agreement until XXX, the Escrow Agent shall pay
interest and any other investment earnings to New Skies on a quarterly basis,
unless otherwise directed in writing by New Skies.  From and after XXX,
the Escrow Agent shall pay interest and any other investment earnings to BSSI
on a quarterly basis, unless otherwise directed in writing by BSSI.  All payments of interest and other investment
earnings to New Skies and BSSI in accordance herewith shall be made to such
account as may be notified in writing by New Skies or BSSI, respectively, to
the Escrow Agent.  In the event of a
dispute under Article III, unless otherwise instructed in writing by BSSI and
New Skies, the Escrow Agent shall place interest and any other investment
earnings on any disputed amount into the Escrow Account.

 

ARTICLE III

DISBURSEMENTS FROM THE ESCROW ACCOUNT

 

3.1           Except to the extent
expressly permitted in Section 2.3 and Article IV hereof, the Escrow Agent
shall only disburse amounts held in the Escrow Account upon receipt of a written
notice (“Disbursement Request”) from BSSI specifying (i) the amount to be
disbursed, (ii) the date of disbursement, (iii) the recipient of the
disbursement, and (iv) the manner of disbursement and delivery
instructions.  Such Disbursement Request
shall be provided to the Escrow Agent no less than seven (7) Business Days
prior to the requested disbursement date.

 

3

 

3.2           The
Escrow Agent shall give New Skies at least five (5) Business Days’ prior
written notice before making any disbursement hereunder, which notice shall
include a copy of the Disbursement Request. If the Escrow Agent receives a
written protest to the Disbursement Request from New Skies prior to 12:00 p.m.
(Chicago time) on the requested disbursement date set forth in the Disbursement
Request, the Escrow Agent shall not make the disbursement (or, if New Skies’
protest relates to only a portion of the Disbursement Request, shall disburse
only the undisputed portion of the Disbursement Request).

 

3.3           Nothing
in Section 3.2 shall prohibit the Escrow Agent from making a disbursement in
response to one or more subsequent Disbursement Requests that are not protected
by New Skies.

 

ARTICLE IV

COMPENSATION; EXPENSES

 

4.1           As compensation for its
services to be rendered under this Agreement, for each year or any portion
thereof, the Escrow Agent shall receive a fee in the amount specified in Schedule A
to this Agreement and shall be reimbursed upon request for all expenses,
disbursements and advances, including reasonable fees of outside counsel, if
any, reasonably incurred or made by it in connection with the carrying out of
its duties under this Agreement.

 

4.2           New
Skies shall pay the Acceptance Fee and the Annual Administrative Fee for the
first one-year period as set forth in Schedule A upon execution of the Escrow
Agreement.  The Escrow Agent shall bill
the parties for each subsequent Annual Administrative Fee as it becomes
due.  New Skies and BSSI, jointly and
severally, shall be responsible for paying such amount.  Any fees or expenses not paid as provided,
prior to final termination of this Agreement, shall constitute a charge on the
deposits hereunder of the party or parties responsible for the payment of the
fees and expenses, and the Escrow Agent shall not be required to make final
distribution or delivery of said deposits until its outstanding fees and
expenses have been paid. The Administrative Fee shall be pro rated on a
six-month basis for any partial year period.

 

4.3           Subject
to Section 4.2, the Escrow Agent agrees that it will not deduct any amounts
from, or exercise set-off against any amounts in, the Escrow Fund, whether in
relation to amounts owing by New Skies, BSSI or any other party, hereunder or
otherwise.

 

ARTICLE V

EXCULPATION AND INDEMNIFICATION

 

5.1           The obligations and
duties of the Escrow Agent are confined to those specifically set forth in this
Agreement.  In the event that any of the
terms and provisions of any other agreement between any of the parties hereto
conflict or are inconsistent with any of the terms and provisions of this
Agreement, the terms and provisions of this Agreement shall

 

4

 

govern and control the obligations and duties of the Escrow Agent in
all respects.  The Escrow Agent shall not
be subject to, nor be under any obligation to ascertain or construe the terms
and conditions of any other instrument, whether or not now or hereafter
deposited with or delivered to the Escrow Agent or referred to in this
Agreement, nor shall the Escrow Agent be obligated to inquire as to the form,
execution, sufficiency, or validity of any such instrument nor to inquire as to
the identity, authority, or rights of the person or persons executing or
delivering same; provided that in the event that New Skies and BSSI
settle any dispute arising out of or in connection with the NSS-8 Contract as
provided in that contract, the Escrow Agent shall comply with any decision
rendered by the arbitrators or by a court of law in accordance therewith.  The Escrow Agent is hereby expressly
authorized to comply with and obey awards of any such arbitrators and orders,
judgments or decrees of any such court of law, notwithstanding any notices,
warnings or other communications from any party or any other person to the
contrary.  In case the Escrow Agent obeys
or complies with any such award, order, judgment or decree, the Escrow Agent
shall not be liable to any of the parties hereto or to any other person by
reason of such compliance, notwithstanding any such award, order, judgment or
decree being subsequently reversed, modified, annulled, set aside, vacated or
found to have been entered without jurisdiction.

 

5.2           The Escrow Agent shall
not be personally liable for any act that it may do or omit to do hereunder in
good faith and in the exercise of its own best judgment.  Any act done or omitted to be done by the
Escrow Agent pursuant to the advice of its attorneys shall be deemed
conclusively to have been performed or omitted in good faith by the Escrow Agent.

 

5.3           In the event the Escrow
Agent is notified of any dispute, disagreement or legal action between New
Skies and BSSI and any third party relating to or arising in connection with
the escrow, the Escrow Fund, or the performance of the Escrow Agent’s duties
under this Agreement, the Escrow Agent will not be required to determine the
controversy or to take any action regarding it. 
The Escrow Agent may hold all documents and funds and may wait for
settlement of any such controversy by final appropriate legal proceedings,
arbitration, or other means as, in the Escrow Agent’s discretion, it may
require.  In such event, the Escrow Agent
will not be liable for interest (other than interest and any other investment
earnings earned by the Escrow Amount during such period) or damage.  Furthermore, the Escrow Agent may, at its
option, file an action of interpleader requiring the parties to answer and
litigate any claims and rights among themselves, provided that such action must
be brought in accordance with Article XV hereof if the dispute involves solely
New Skies and BSSI.  The Escrow Agent is
authorized, at its option, to deposit with the Clerk of the Court or the
Arbitrator(s), as applicable, all documents and funds held in escrow, except
all costs, expenses, charges, and reasonable attorneys’ fees incurred by the
Escrow Agent due to the interpleader action and which New Skies and BSSI
jointly agree to pay.  Upon initiating
such action, the Escrow Agent shall be fully released and discharged of and
from all obligations and liability imposed by the terms of this Agreement.

 

5

 

5.4           New Skies and BSSI
hereby agree, jointly and severally, to indemnify and hold the Escrow Agent,
and its directors, officers, employees, and agents, harmless from and against
all costs, damages, judgments, reasonable attorneys’ fees (whether such
attorneys shall be regularly retained or specifically employed), expenses,
obligations and liabilities of every kind and nature which the Escrow Agent,
and its directors, officers, employees, and agents, may incur, sustain, or be
required to pay in connection with or arising out of this Agreement, unless the
aforementioned results from the Escrow Agent’s gross negligence or willful
misconduct, and to pay the Escrow Agent on demand the amount of all such costs,
damages, judgments, attorneys’ fees, expenses, obligations, and liabilities.
The costs and expenses of enforcing this right of indemnification also shall be
paid jointly by New Skies and BSSI.  The
foregoing indemnities in this paragraph shall survive the resignation or
substitution of the Escrow Agent or the termination of this Agreement.

 

ARTICLE VI

TERMINATION OF AGREEMENT

 

6.1           This
Agreement may be terminated at any time upon the receipt by the Escrow Agent of
three (3) Business Days prior written notice of termination executed jointly by
New Skies and BSSI directing the distribution of all assets then held by the
Escrow Agent under and pursuant to this Agreement.  This Agreement shall automatically terminate
if and when all amounts in the Escrow Account (including all the securities in
which any of the funds deposited into the Escrow Account shall have been
invested) shall have been distributed by the Escrow Agent in accordance with
the terms of this Agreement; provided, however, that the rights
and obligations of the parties hereto shall survive the termination hereof.

 

ARTICLE VII

RESIGNATION OF ESCROW AGENT

 

7.1           The
Escrow Agent may resign at any time upon giving at least thirty (30) days prior
written notice to New Skies and BSSI; provided, however, that no
such resignation shall become effective until the appointment of a successor
escrow agent which shall be accomplished as follows: New Skies and BSSI shall
use commercially reasonable efforts jointly to select a successor escrow agent
within thirty (30) days after receiving such notice.  If New Skies and BSSI fail to appoint a
successor escrow agent within such time, the Escrow Agent shall have the right
to appoint a successor escrow agent.  The
successor escrow agent shall execute and deliver an instrument accepting such
appointment and it shall, without further acts, be vested with all the estates,
properties, rights, powers, and duties of the predecessor escrow agent as if
originally named as escrow agent.  Upon
delivery of such instrument, the Escrow Agent shall be discharged from any
further duties and liability under this Agreement. The Escrow Agent shall pay
any interest or other investment income earned up to the date of transfer (less
any outstanding fees and

 

6

 

expenses) and
shall be paid any additional outstanding fees and expenses prior to
transferring assets to a successor escrow agent.

 

ARTICLE VIII

NOTICES

 

8.1           All notices required by this Agreement shall
be in writing and shall be deemed to have been received (a) immediately if sent
by facsimile transmission (with a confirming copy sent the same Business Day by
registered or certified mail), or by hand delivery (with signed return receipt),
or (b) the next Business Day if sent by nationally recognized overnight
courier, in any case to the respective addresses as follows:

 

If to New Skies:

New Skies Satellites B.V.

Rooseveltplantsoen #4

2517 KR The Hague

The Netherlands

Attention: Mr. Derek Simmons, Manager Financial Analysis

Telephone: 011-31-70-306-4132

Fax: +011-31-70-306-4288

 

With a copy to:

New Skies Satellites B.V.

Rooseveltplantsoen #4

2517 KR The Hague

The Netherlands

Attention: Mr. Thai Rubin, General Counsel

Telephone: 011-31-70-306-4116

Fax: +011-31-70-306-4289

 

If to Boeing Satellite Systems International, Inc.:

 

Boeing Satellite Systems International, Inc.

P.O. Box 92919

Los Angeles, CA  90009

Attention: Mr. Dennis Beeson

Bldg. S01, Mail Sta. D324

Telephone: (310) 364-5729

Fax: (310) 364-8307

 

If to the Escrow Agent:

 

LaSalle Bank National Association

135 South LaSalle Street

Suite 1960

Chicago, IL  60603

Attention: Mark T. LoIacono

Telephone: (312) 904-6836

Fax:  (312) 904-2236

 

7

 

 

 

ARTICLE IX

GOVERNING LAW

 

9.1           This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York and the parties hereto consent to jurisdiction in the State
of Illinois and venue in any state or Federal court located in the City of
Chicago.  

 

ARTICLE X

AUTOMATIC SUCCESSION

 

10.1         Any bank or corporation
into which the Escrow Agent may be merged or with which it may be consolidated,
or any bank or corporation to whom the Escrow Agent may transfer a substantial
amount of its escrow business, shall (following written notice to New Skies and
BSSI) be the successor to the Escrow Agent without the execution or filing of
any paper or any further act on the part of any of the parties, anything herein
to the contrary notwithstanding.

 

ARTICLE XI

AMENDMENT AND MODIFICATION

 

11.1         New
Skies, BSSI and the Escrow Agent may amend, modify, and/or supplement this
Agreement as they may mutually agree in writing.

 

ARTICLE XII

COUNTERPARTS

 

12.1         This
Agreement may be executed in any number of counterparts, each of which shall be
an original and all of which taken together shall constitute one and the same
instrument.  In making proof of this
Agreement it shall be necessary to produce or account for only one such
counterpart signed by or on behalf of the party sought to be charged herewith.

 

ARTICLE XIII

INTERPRETATION

 

13.1         The headings used in this
Agreement are for convenience only and shall not constitute a part of this
Agreement.

 

13.2         As
used in this Agreement, “Business Day” means a day other than a Saturday,
Sunday, or other day when banking institutions in Chicago, Illinois are
authorized or required by law or executive order to be closed.

 

8

 

ARTICLE XIV

SEVERABILITY

 

 14.1        The
parties agree that if any provision of this Agreement shall under any
circumstances be deemed invalid or inoperative this Agreement shall be
construed with the invalid or inoperative provisions deleted and the rights and
obligations of the parties shall be construed and enforced accordingly.

 

ARTICLE XV

RESOLUTION OF DISPUTES

 

15.1         Any
controversy or claim arising out of or relating to this Agreement or the breach
hereof or any unilateral Disbursement Request (but excluding any dispute that
arises out of or relates to the NSS-8 Contract) shall be settled by arbitration
in accordance with commercial rules of the American Arbitration Association (“AAA”).  Arbitration proceedings conducted pursuant to
this Article XV shall be held in Chicago, Illinois.

 

15.2         Arbitrations shall be
conducted by a single arbitrator (the “Arbitrator”) selected at random
from a list of arbitrators maintained in the office of AAA in Chicago,
Illinois.  The Arbitrator must be a
person experienced in corporate law or the law of commercial finance and must
have served as an arbitrator in not less than three prior commercial
arbitrations involving primarily questions of commercial or corporate law
conducted under the AAA rules.  The
Arbitrator may not be a person who ever has been an affiliate of or attorney
for any party or for any of their respective affiliates.

 

15.3         The
parties shall allow and participate in discovery in accordance with the United
States Federal Rules of Civil Procedure for a period of 90 days after the
filing of an answer or other responsive pleading.  Unresolved discovery disputes may be brought
to the attention of the Arbitrator for resolution.

 

15.4         Any provisional remedy
that would be available from a court of law shall be available from the
Arbitrator to the parties pending arbitration. 
Any party may, without inconsistency with this Agreement, apply to any
court of proper jurisdiction and seek injunctive relief to maintain the status
quo until the arbitration award is rendered or the controversy is otherwise
resolved.

 

15.5         The Arbitrator’s award
shall be made in writing, but shall not make any findings of fact or
conclusions of law.  The Arbitrator shall
have no authority to award punitive or other damages not measured by the
prevailing party’s actual damages and may not, in any event, make any ruling,
finding, or award that does not conform to the terms and conditions of this
Agreement and the NSS-8 Contract. 
Judgment on any arbitration award may be entered by the Arbitrator or by
any party in any court having jurisdiction thereof.  No party or Arbitrator may disclose the
existence, content, or results of any arbitration or arbitration award without
the prior written consent of both parties except to the extent necessary to enter
and enforce a judgment based upon such award.

 

9

 

15.6         The award of the
Arbitrator shall be final and not subject to appeal.  Each party hereby waives the benefit of any
applicable law that would permit it to appeal the decision of the Arbitrator to
any court or other authority.

 

15.7         Any
Arbitration conducted pursuant to this Article XV shall relate solely to
controversies and claims arising under or relating to this Agreement or the
breach hereof.  New Skies and BSSI shall
resolve any dispute or disagreement arising under or relating to the NSS-8
Contract in accordance with Article 21 thereof, including its arbitration
provisions (which currently provide for arbitration under the Rules of
Conciliation and Arbitration of the International Chamber of Commerce by three
arbitrators in an arbitration conducted in the United Kingdom).

 

15.8         All
fees and expenses of the arbitration shall be borne by the parties
equally.  However, each party shall bear
the expense of its own counsel, experts, witnesses, and preparation and
presentation of proofs.  Notwithstanding
the foregoing, the Arbitrator shall be entitled to tax and assess costs against
any party (including the fees of attorneys and arbitrators) to the extent that
the Arbitrator finds that such party delivered a unilateral Disbursement
Request or a protest of a Disbursement Request, or any portion thereof, on a
basis which was unreasonable, speculative or primarily for the purpose of
delaying the exercise of rights by the prevailing party.

 

15.9         The
provisions of this Article XV shall survive termination of this Agreement.  Any dispute regarding the applicability of
this Article XV to a particular claim or controversy shall be arbitrated as
provided in this Article XV.

 

[The next page is the
signature page]

 

IN WITNESS
WHEREOF, the parties hereto have executed and delivered this Agreement as of
the day and year first above written.

 

	
   

  	
  NEW SKIES SATELLITES B.V.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Daniel Goldberg

  	
   

  
	
   

  	
  Name:

  	
  Daniel Goldberg

  	
   

  
	
   

  	
  Title:

  	
  CEO

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BOEING SATELLITE
  SYSTEMS

  
	
   

  	
  INTERNATIONAL,
  INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Dennis Beeson

  	
   

  
	
   

  	
  Name:

  	
  Dennis Beeson

  	
   

  
	
   

  	
  Title:

  	
  Manager

  	
   

  

 

10

 

	
   

  	
  LASALLE BANK NATIONAL ASSOCIATION, as Escrow Agent

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ R.C. Bergman

  	
   

  
	
   

  	
  Name: 

  	
  R.C. Bergman

  	
   

  
	
   

  	
  Title:

  	
  First Vice President

  	
   

  

 

 

11

 

SCHEDULE A

 

ESCROW AGENT

SCHEDULE OF FEES

 

	
  Acceptance Fee:

  	
  $

  	
  XXX

  
	
   

  	
   

  	
   

  
	
  Annual Administration Fee:

  	
  $

  	
  XXX

  

 

The
Acceptance and first year’s Annual Administration Fees are due upon execution
of the Escrow Agreement.

 

Any investment transaction not in a
money market fund or a LaSalle Enhanced Liquidity Management (LELM) account
will incur a $125.00 per transaction fee. The parties to the Agreement
understand and agree that the Escrow Agent may receive certain revenue on
certain mutual fund investments.  These
revenues take one of two forms:

 

Shareholder Servicing Payments: The Escrow
Agent may receive Shareholder Servicing Payments as compensation for providing
certain services for the benefit of the Money Market Fund Company.  Shareholder Services typically provided by LaSalle
include the maintenance of shareholder ownership records, distributing
prospectuses and other shareholder information materials to investors and
handling proxy-voting materials. Typically, Shareholder Servicing payments are
paid under a Money Market Fund’s 12b-1 distribution plan and impact the
investment performance of the Fund by the amount of the fee. The shareholder
servicing fee payable from any money market fund is detailed in the Fund’s
prospectus that will be provided to you.  

 

Revenue Sharing Payments: The Escrow Agent
may receive revenue sharing payments from a Money Market Fund Company. These
payments represent a reallocation to the Escrow Agent of a portion of the
compensation payable to the fund company in connection with your account’s
money market fund investment. Revenue Sharing payments constitute a form of fee
sharing between the fund company and the Escrow Agent and do not, as a general
rule, result in any additional charge or expense in connection with a money
market fund investment, are not paid under a 12b-1 plan, and do not impact the
investment performance of the Fund.  The
amount of any revenue share, if any, payable to Escrow Agent with respect to
your account’s investments is available upon request.

 

All out-of-pocket expenses will be billed at the Escrow Agent’s
cost.  Out-of-pocket expenses include,
but are not limited to, costs of professional services (e.g. legal or
accounting), postage (including express mail and overnight delivery charges),
and copying charges.

 

 

EXHIBIT 
F

 

METHOD OF ADJUSTMENT TO TOTAL PRICE

 

 

Confidential Treatment Requested

 

For Entire Exhibit

 

 

EXHIBIT G

 

EXPORT LAWS
COMPLIANCE PLAN

 

G.1                             Export Licensing and
Compliance, Management Resources and Process

 

During the period of this Contract, the Contractor shall maintain an
Export Compliance Office to support the United States government licensing and
export requirements related to the NSS-8 spacecraft program. The
Contractor shall identify for NSS the title, responsibilities and the location
of the unit of the Office that is responsible for particular export-licensing
functions under this Contract and shall ensure that each such unit of the
Office is staffed with export specialists who will carry out their functions by
drawing upon the technical expertise of the Contractor.

 

The Contractor’s licensing and technical specialists shall be
responsible for preparing, submitting, monitoring status and following up on
processing of all applications that are required for the NSS-8 program
under the International Traffic in Arms Regulations (“ITAR”) administered by
the Office of Defense Trade Controls, U.S. Department of State (“ODTC”). The
Contractor shall ensure that such license preparation begins in a timely manner
with adequate lead-time for approval cycles, recognizing that NSS will be
required to provide documents and review draft agreements in a timely manner,
and that all license paperwork and technical documents meet the requirements of
the provisions of the ITAR. The Contractor shall interface with all U.S.
government offices that are involved in the processing and review of ITAR
license applications including ODTC and the Defense Threat Reduction Agency (“DTRA”).

 

Contractor’s Export Compliance staff shall with the cooperation of NSS
respond expeditiously to any U.S. government questions or concerns regarding
applications to ODTC under the ITAR or regarding the NSS-8 program with a
view to resolving issues promptly to permit final processing of pending
applications. Contractor’s export compliance staff shall also prepare, submit,
monitor and support all administrative paperwork necessary for the mandatory
Congressional notification for the sale of commercial communications satellites
to non-U.S. buyers when such sales exceed a value of $50 million USD.

 

Within 60 days of the signature of this Contract, the Export Compliance
Office shall prepare and submit to NSS for prior approval an export license
administrative plan that will identify export licensing requirements for the
entire NSS-8 program, from program start to launch and final delivery.
This plan shall show milestones for preparing, seeking and obtaining all
required ODTC authorizations. The purpose of this plan shall be to minimize
delay associated with seeking required authorization for the export of defense
articles, including technical data, and defense services for

 

G-1

 

the
NSS 8 program. The Export Compliance Office will be responsible for updating
this plan as and when circumstances require.

 

G.2                             New Skies Networks Inc. and
NSS Access to Program Information

 

For all purposes relating to the application of the ITAR to the export
from the United States of defense articles, including technical data, and
defense services, Contractor shall treat New Skies Networks Inc. (“NSNI”) as a “United
States person” under the ITAR, provided that NSNI maintains its registration in
good standing with ODTC. Contractor shall also treat as “United States persons”
under the ITAR all United States citizens and U.S. permanent resident aliens
who are employees of NSNI or that are consultants or independent contractors.
Accordingly, Contractor shall without prior ODTC authorization furnish defense
articles, including technical data, and defense services relating to the NSS-8
program to NSNI or to U.S. citizen employees, consultants and independent
contractors of NSNI, provided that such articles or services are not
subject to specific restriction for release to such persons under the terms and
conditions of applicable ODTC export licenses issued to Contractor or NSS and
provided also that NSNI has provided Contractor with appropriate written
assurances that NSNI will not release such articles or services to foreign
persons, as defined by the ITAR, without prior ODTC authorization. For the
avoidance of doubt, from EDC until the date that an export license for the
Spacecraft is obtained, Contractor agrees to treat NSNI, all U.S. citizens and
U.S. permanent resident aliens who are employees of NSNI or that are
consultants or independent contractors of NSNI as U.S. persons under the ITAR.

 

G.3                                                                             NSS Program Licenses

 

In accordance with the Statement of Work and Spacecraft Performance
Specification herein and with this Exhibit G, Contractor anticipates
various U.S. Government authorizations and licenses will be required to support
the export of technical data and associated defense services during the period
of performance of this Contract. These may include, but may not be limited to,
the following authorizations and licenses for which Contractor will have the
responsibilities set forth in Section G.1 above:

 

Technical Assistance Agreements

 

a)                                      Program Services Technical Assistance
Agreement (TAA) providing for export of the technical data and defense services
for the full scope of the development and production Work under this Contract,
including daily

 

G-2

 

technical interactions, design reviews, test data reviews, technical
meetings, initial mission/on-orbit support, and certain deliverable software.

 

b)                                     Launch Services TAA providing for export of
the technical data and defense services to all the launch service providers as
required in accordance with this Contract to cover activities related to launch
vehicle interface definition and launch campaign support.

 

c)                                      Customer Service TAA providing for export of
technical data and services for efforts associated with long-term, on-orbit
support of the Spacecraft.

 

Manufacturing
Licensing Agreements (MLAs)

 

MLAs
to authorize the export of ITAR controlled technical data and defense services
to support subcontracts for the manufacture of hardware components for the
Spacecraft by non-U.S. suppliers.

 

DSP-5
Licenses

 

a)                                      DSP-5 licenses for the shipment of the
Spacecraft and related fuel and spare parts, as well as any other defense
articles required in connection with launches because of the nature of the
launch vehicle or the launch location.

 

b)                                     DSP-5 licenses for shipment and
presentation of specific data items associated with launch-related insurance
briefings, and related DSP-83s to be executed by insurance underwriters.

 

c)                                      DSP-5 licenses for shipment of any
satellite control software to NSS ground control facilities.

 

d)                                     DSP-5 licenses for shipment of the
Dynamic Satellite Simulator software.

 

e)                                      DSP-5 licenses for the shipment of
flight software source code.

 

f)                                        DSP-5 and other required approvals for
encryption keys and technical data relating to the command encryption software.

 

DSP-73
Licenses

 

a)                                      DSP-73 licenses for the temporary
import and/or export of launch campaign support equipment to the launch site
including mechanical support equipment

 

G-3

 

b)                                     DSP-73 licenses for shipment of
mission/in-orbit test support equipment to the relevant non-U.S. sites,
including mission control centers and tracking sites.

 

DSP-61
Licenses

 

DSP-61
licenses to authorize the temporary import and re-export of hardware and data
that may be required for the launch vehicle adapter in order to perform a fit
check.

 

G.4                             Alternative Launch Vehicle
Licenses

 

Contractor shall maintain and/or apply for the required export licenses
and agreements related to one alternative non-U.S. launch services provider in
a manner consistent with the schedule requirements of Article 8.D,
Option to Change Launch Services.

 

G.5                             License Process Monitoring

 

Contractor shall during the performance of this Contract abide by the
course of action and processes as described above and shall make every
reasonable effort to ensure compliance with the procedures outlined in order to
permit compliance with timetables established under this Contract. Contractor
shall seek to have all export license applications processed expeditiously such
that no NSS-8 program milestone is affected by any U.S. Government
administrative processing delay including, in particular, action by ODTC.
Contractor shall keep NSS informed by way of written weekly status reports of
the progress of all export license applications and approvals, including the
status of license applications both within the Contractor’s organization and
within the U.S. Government until such time as all necessary export licenses are
obtained.

 

G-4

EXHIBIT H

 

Execution copy

 

 

 

AGREEMENT
OF NON-POSSESSORY PLEDGE OF ASSETS

 

between

NEW SKIES
SATELLITES B.V.

 

as
Pledgor

and

 

BOEING SATELLITE SYSTEMS
INTERNATIONAL, INC.

as
Pledgee

 

 

 

 

NSS-8

 

 

 

INDEX

 

	
  1

  	
  DEFINITIONS AND
  INTERPRETATION

  	
  4

  
	
  2

  	
  PLEDGE

  	
  6

  
	
  3

  	
  ACCESSORY RIGHTS
  AND ANCILLARY RIGHTS

  	
  6

  
	
  4

  	
  REPRESENTATIONS
  AND WARRANTIES

  	
  7

  
	
  5

  	
  UNDERTAKINGS

  	
  7

  
	
  6

  	
  CONSENT

  	
  9

  
	
  7

  	
  ENFORCEMENT AND
  POWER OF ATTORNEY

  	
  9

  
	
  8

  	
  TERMINATION

  	
  11

  
	
  9

  	
  ASSIGNMENT

  	
  11

  
	
  10

  	
  CONFIDENTIALITY

  	
  12

  
	
  11

  	
  DISPUTES

  	
  12

  
	
  12

  	
  COSTS

  	
  12

  
	
  13

  	
  NOTICES

  	
  12

  
	
  14

  	
  LIABILITY

  	
  12

  
	
  15

  	
  LIMITATION; WAIVER

  	
  13

  
	
  16

  	
  SECURITY INTEREST ABSOLUTE

  	
  13

  
	
  17

  	
  AMENDMENT OF THIS
  AGREEMENT

  	
  13

  
	
  18

  	
  GOVERNING LAW AND
  JURISDICTION

  	
  13

  
	
  19

  	
  SEVERABILITY OF
  PROVISIONS

  	
  14

  
	
  20

  	
  REMEDIES AND
  PREVALENCE

  	
  14

  
	
  21

  	
  REGULATORY MATTERS

  	
  14

  
	
  22

  	
  REGISTRATION

  	
  15

  
	
  23

  	
  COUNTERPARTS

  	
  16

  

 

ANNEX 1               LIST OF TT&C EQUIPMENT AND SOFTWARE

THIS AGREEMENT OF NON-POSSESSORY PLEDGE OF ASSETS

is dated 22 February  2005,

BETWEEN:

1                                           New Skies Satellites B.V., a private
company with limited liability (besloten
vennootschap), incorporated and existing under the laws of The
Netherlands, with corporate seat in Amsterdam, The Netherlands, having its
registered address at Rooseveltplantsoen 4, 2517 KR The Hague, The Netherlands,
registered with the Commercial Register under number 30146277 (“New Skies” or
the “Pledgor”); and

2                                           Boeing Satellite Systems International, Inc., a
company organized under the laws of Delaware with its principal place of
business located at 2260 East Imperial Highway, El Segundo, CA, U.S.A. (“BSSI”
or “Pledgee”).

WHEREAS:

(a)                                   Pursuant
to the NSS-8 Contract (as defined below), New Skies and BSSI, the parties
thereto, amended their previous agreement for the sale and purchase of the
Spacecraft (as defined below) to provide for, inter alia,  an amended delivery deadline and for changes
in the price, payment terms and certain other terms and conditions of the
contract

(b)                                  Under
the NSS-8 Contract, the entire purchase price for the Spacecraft is payable as
incentive payments during the fifteen years following the In Service Date;

(c)                                   As a
condition to entering into the NSS-8 Contract and in order to secure and
provide for the payment by New Skies of the Secured Obligations (as defined
below), as and when due, on the terms and subject to the conditions set forth
herein and therein, the Pledgor and the Pledgee have agreed that the Pledgor
shall enter into this Agreement of Non-Possessory Pledge of Assets; and

(d)                                  The
parties intend to create a sole and first ranking right of pledge on the
Spacecraft (as defined below). In that respect, the Spacecraft (as defined
below) (i) has been released from the non-possessory right of pledge on assets
created in favour of the financial institutions which are a party to the USD
535,000,000 Credit Agreement, dated 2 November 2004 (as amended from time to
time) (the “Bank Pledge”), amongst New Skies,
Deutsche Bank AG, New York Branch and the other parties named in it as a party,
and (ii) has been excluded from the definition of “Assets “ as contained in the
Bank Pledge.

(e)                                   XXX

 

IT IS HEREBY AGREED AS FOLLOWS:

1                                           DEFINITIONS
AND INTERPRETATION

1.1                                  All
capitalised terms used in this Agreement, including the recitals, and not
otherwise defined herein, shall have the meaning assigned to them in the NSS-8
Contract.

1.2                                  a.          Headings
are for convenience of reference only.

b.                          Where the context so permits, the singular includes the plural and vice versa.

c.                             Save
where the contrary is indicated, any reference in this Agreement to a party or
the parties to this Agreement shall be construed so as to include its or their
respective permitted successors, transferees and assigns from time to time and
any permitted successor of such a successor, transferee or assign in accordance
with their respective interests, and all in accordance with the terms of the
NSS-8 Contract.

d.                            A “Clause” and
a “sub clause” shall, subject to any indication to the contrary, be construed
as a reference to a clause and subclause hereof.

e.                             References to
the NSS-8 Contract, this Agreement or any other agreement or document shall,
where applicable, be deemed to be references to such NSS-8 Contract, this
Agreement or such other agreement or document as the same may have been, or may
from time to time be, extended, prolonged, amended, restated, supplemented,
renewed or novated.

f.                               A statute or
statutory provision shall be construed as a reference to such statute or
statutory provision as the same may have been, or may from time to time be,
amended or re-enacted and all instruments, orders, plans, regulations, by-laws,
permissions and directions at any time made thereunder.

g.                            References to
the Dutch Civil Code are references to het
Nederlands Burgerlijk Wetboek.

 

 

1.3                                  In
this Agreement, including the recitals, the following words and expressions
shall have the following meaning:

“Agreement” means this Agreement of Non-Possessory Pledge of
Assets;

“Default Notice” means the default notice substantially in
the form provided by the Pledgee to the Pledgor 30 days after the date of this
Agreement at the latest and agreed between the Parties (acting reasonably)
within 10 days after that date, that is issued following an Event of Default in
accordance with Article 19 of the NSS-8 Contract and Article 7 hereof;

“Event of Default” shall have the meaning set forth in the
NSS-8 Contract;

“Export
Laws” shall have the meaning set forth in the NSS-8
Contract;

“Governmental
Authority” shall mean any federal, state, local or
foreign court or governmental agency, authority, instrumentality or regulatory
or legislative body;

“Material Adverse Effect” shall
have the meaning set forth in the NSS-8 Contract;

“NSS-8
Contract” means the amended and restated NSS-8
Spacecraft and Associated Equipment and Services Contract (Number NSS-20-03-01)
made between BSSI and New Skies and dated 22 February 22, 2005;

“Orbital
Station” shall have the meaning set
forth in the NSS-8 Contract;

“Permitted
Lien” shall have the meaning set
forth in the NSS-8 Contract;

“Permitted
Spacecraft Disposal” shall
have the meaning set forth in the NSS-8 Contract;

“Right of Pledge” means the right of pledge created under this
Agreement;

“Secured
Obligations” means the monetary payment obligations (verbintenissen tot betaling van een geldsom) of the Pledgor
to the Pledgee with respect to the incentive payments and interest due to the Pledgee
under Paragraphs 5.C and 5.D of the NSS-8 Contract, including upon acceleration
thereof pursuant to and in accordance with Article 19 of the NSS-8 Contract;

“Security Period” means the period beginning on the date hereof
and ending on the earlier date upon which (a) all but the last XXX Dollars ($XXX) of
incentive payments constituting Secured Obligations have been irrevocably
(other than as provided in Paragraph 5.3.C of the NSS-8 Contract) paid to the
Pledgee and discharged in full or have ceased to exist, all in accordance with
the terms of the NSS-8 Contract, and (b) the Right of Pledge has been released
and discharged by the Pledgee in accordance with Clause 8.2 below;

 

“Spacecraft”
means the NSS-8 satellite to be manufactured and
delivered by BSSI to New Skies pursuant to the NSS-8 Contract;

“TT&C”
means telemetry, tracking, command and control
operations.

2                                           PLEDGE

2.1                                  The
Pledgor hereby agrees with the Pledgee and hereby undertakes that the Pledgor
shall grant to the Pledgee the right of pledge purported to be granted under
and pursuant to this Agreement.

2.2                                  As
security for the payment and discharge in full, as and when due (whether at
stated maturity, by acceleration or otherwise), of the Secured Obligations, the
Pledgor hereby grants, for the duration of the Security Period, to the Pledgee
a first ranking non-possessory right of pledge (stil pandrecht eerste in rang), over the Spacecraft and the
Pledgee hereby accepts such right of pledge.

2.3                                  The
Pledgor irrevocably and unconditionally undertakes to take such action
(including the execution of documents to be made up in form and sub­stance
satis­fac­to­ry to the Pledgee) as and when the Pledgee deems necessary in its
reasonable opinion from time to time to create, perfect and maintain a valid
and enforceable first priority right of pledge or other equivalent right under
any applicable law (if and to the extent, in the reasonable opinion of the
Pledgee, it would appear that, contrary to the expectations of the parties,
another law would be more appropriate (from a private international law
perspective) to govern a security right such as contemplated
hereby) in favour of the Pledgee with respect to the Spacecraft, including the
registration and filing of this Agreement with the Belastingdienst Amsterdam Afdeling Registratie Unit promptly upon execution thereof, and in any
event no later than 10 business days after the date of such execution,
and the payment of any stamp, registration, notary or other taxes and fees in
connection therewith. As soon as reasonably practicable after such registration
or filing, the Pledgee will be provided with a copy of this Agreement together
with proof of registration or filing, as the case may be.

2.4                                  This
Right of Pledge is one and indivisible (één en ondeelbaar).
Partial fulfilment of the Secured Obligations shall not extinguish the Right of
Pledge proportionally.

3                                           ACCESSORY
RIGHTS AND ANCILLARY RIGHTS

The Right of Pledge includes all accessory rights (afhankelijke rechten) and all ancillary
rights (nevenrechten) attached to
the Spacecraft.

 

 

 

4                                           REPRESENTATIONS
AND WARRANTIES

The Pledgor represents and warrants that the following is true and correct on the date of this
Agreement:

(i)                           subject
to delivery of the Spacecraft by the Pledgee to the Pledgor in accordance with
Article 6 of the NSS-8 Contract, the Pledgor holds full and exclusive title to
the Spacecraft and is authorised (beschikkingsbevoegd)
to create a right of pledge thereover;

(ii)                        except
for the Right of Pledge created pursuant to this Agreement and any Permitted Liens,
the Spacecraft has not been encumbered with any attachment (beslag) or any rights in rem (beperkte rechten), and has not been
transferred or pledged in advance;

(iii)                     it has the corporate power to enter into, and
to perform its obligations under, this Agreement;

(iv)                    all necessary corporate execution has been taken
by it in respect of entering into, and the performance of its obligations
under, this Agreement;

(v)                       it has validly executed this Agreement;

(vi)                    it does not violate any provision of its articles
of association by entering into, or by performing its obligations under, this
Agreement; and

(vii)                 this Agreement
creates, subject to recital (e) and without prejudice to the obligation of the
Pledgor in the last sentence of recital (e), a valid first ranking Right of
Pledge, which is enforceable in accordance with its terms and applicable law
and its contractual obligations under this Agreement are its legal, valid and
binding obligations, enforceable in accordance with their terms and applicable
law.

5                                           UNDERTAKINGS

5.1                                  Except
to the extent permitted under this Agreement or the NSS-8 Contract with respect
to Permitted Spacecraft Disposals and Permitted Liens, the Pledgor undertakes
not to waive without the prior written consent of the Pledgee (not to be
unreasonably withheld, conditioned or delayed) any accessory rights (afhankelijke rechten) or ancillary rights (nevenrechten) attached to the Spacecraft and in general not
to perform any acts which could reasonably be expected to have, individually or
in the aggregate, a Material Adverse Effect, including a material reduction of
the value of the Spacecraft.

 

5.2                                  Except
to the extent permitted under this Agreement or the NSS-8 Contract with respect
to Permitted Spacecraft Disposals and Permitted Liens, the Pledgor shall not,
without the prior written consent of the Pledgee (not to be unreasonably
withheld, conditioned or delayed) transfer or further pledge or otherwise
encumber the Spacecraft or agree to a court settlement or an out-of-court
settlement (gerechtelijk or buitengerechtelijk
akkoord) in respect of the Spacecraft.

5.3                                  Upon
the occurrence of a Payment Default and the exercise by the Pledgee of its
rights under Paragraph 19.B.3 of the NSS-8 Contract or the occurrence of an
Event of Default, the Pledgor shall, at the Pledgee’s first request, provide in
the English language to the Pledgee all information and supporting
documentation relating to the Spacecraft and allow an independent third party
designated by the Pledgee (and acceptable to the Pledgor in its reasonable
discretion), following reasonable prior notice and during office hours, to
inspect relevant administrative records of the Pledgor, in each case to the
extent required by the Pledgee (acting reasonably) for the purpose of
confirming that the Pledgor has created, perfected and is maintaining a valid
and enforceable first priority right of pledge in favour of the Pledgee with
respect to the Spacecraft. The reasonable fees (up to
an amount separately agreed with both Parties acting reasonably), cost and
expenses of any such independent third party designated by the Pledgee shall be
borne by the Pledgor.

5.4                                  The
Pledgor shall forthwith inform the Pledgee of any attachment (beslag) over the Spacecraft with an
individual or joint value of EUR 50,000 or more. The Pledgor shall:

(i)                           send
the Pledgee a copy of the relevant attachment or seizure documentation as well
as all other documents required under applicable law for challenging the
attachment or seizure (if and to the extent possible);

(ii)                        notify
the third party or the court process server acting on behalf of such third
party in writing of the Pledgee’s interest over the Spacecraft; and

(iii)                     take such measures as may
reasonably be required to protect the Pledgee’s interest over the Spacecraft.

5.5                                  The
Pledgor covenants for the benefit of the Pledgee throughout the Security Period
that it will co-operate with the Pledgee in the collection and recovery of the
Spacecraft and render all reasonable assistance as may be required pursuant to
any exchange regulations and/or foreign statutory rules or other rules,
including the taking of any legal action that the Pledgee may deem necessary in
connection therewith, in each case after the issuance of a Default Notice to it

5.6                                  In
addition and without prejudice to the obligations of the Pledgor pursuant to
Clauses 5.3 and 5.4 above, the Pledgor shall notify the Pledgee promptly of any
event or circumstance which could 

 

                                                 reasonably be expected to have,
individually or in the aggregate, a Material Adverse Effect, including a
material reduction of the value of the Spacecraft or otherwise cause an Event
of Default.

5.7                                  The
Pledgor shall, at its own expense, in accordance with the terms of this
Agreement, (i) keep and maintain the Spacecraft in good condition (reasonable
wear and tear excepted), take care of and handle the same in a careful and
diligent manner, using normal operating procedures in accordance with,
including but not limited to, the Recommended Operating Procedures (ROPs)
provided by the Pledgee (as may be modified and changed from time to time by
the Pledgee) and procure that its staff and other persons to whom it delegates
its duties and responsibilities in respect of the Spacecraft, shall do
likewise, and (ii) not intentionally perform any act which could reasonably be
expected to result in a material reduction of the value of the Spacecraft.

6                                           CONSENT

The Pledgee hereby revocably authorises the Pledgor
to (i) use the Spacecraft and (ii) to sell, transfer or otherwise dispose of
the Spacecraft in a Permitted Spacecraft Disposal under Article 19 of the NSS-8
Contract, but not otherwise, provided, that
in doing so, the Pledgor complies with the provisions thereof.  In respect of any Permitted Spacecraft
Disposal pursuant to and in accordance with the foregoing authorisation, the
Pledgee waives, renounces and relinquishes all its security rights hereunder
and pursuant thereto as of such moment of disposal. The foregoing authorisation
and waiver, renouncement and relinquishment may be immediately terminated by
the Pledgee with respect to the Pledgor upon the issuance of a Default Notice
to the Pledgor.

7                                           ENFORCEMENT
AND POWER OF ATTORNEY

7.1                                  Without
prejudice to any other right or remedy available to the Pledgee, the Pledgee
may issue to the Pledgor a Default Notice upon the occurrence of an Event of
Default, wherein it may declare the Right of Pledge immediately
enforceable against the Pledgor without any further notice of default being
required and the Pledgee may subject to the requirements of Paragraph 19.D.4 of
the NSS-8 Contract, immediately exercise in respect of the Spacecraft any and
all of its rights and powers set out in this Agreement (subject to restrictions
following from mandatory provisions of law).

7.2                                  To
the extent necessary, the Pledgor agrees for the benefit of the Pledgee that
upon an Event of Default, it shall be deemed to be in default (verzuim) in respect of the Secured
Obligations within the meaning of section 3:248 (1) and 6:81 of the Dutch Civil
Code without any further notice or action being necessary.

7.3                                  Upon
the issuance of the Default Notice, the Pledgee shall be authorised to take
immediate possession and control of the Spacecraft or have possession and
control transferred to a qualified third party designated by Pledgee, subject
to compliance with the requirements of this Agreement and the NSS-8 

 

                                                 Contract
(including without limitation the requirements set forth in Article 21 hereof
and Paragraph 19.D.3 thereof) and applicable law. The Pledgee shall be entitled
to sell or procure the sale of the Spacecraft forthwith, all to the extent
permitted by applicable laws.

7.4                                  To
the fullest extent permitted by law, the Pledgor waives (which waiver the
Pledgee hereby accepts) any right it may have (i) pursuant to section 3:234 of
the Dutch Civil Code to demand, in the event that the Pledgee enforces the
Right of Pledge, that the Pledgee shall also enforce any other security
interests (zekerheidsrechten)
granted by any other party and (ii) of requiring the Pledgee to firstly proceed
against or claim payment from any person or entity or enforce any guarantee or
security granted by any other person or entity before enforcing the Right of
Pledge and/or any other rights under this Agreement.

7.5                                  Annex
1, which will be provided by the Pledgor to the Pledgee 30 days after the date of this
Agreement at the latest, lists the TT&C
equipment and software, which as at the date of this Agreement, the Pledgor
anticipates using in connection with TT&C operations for the Spacecraft
(excluding discretionary items not required in order to perform such TT&C
operations).  On request from Pledgee
(which request may be made up to once annually and at any time following any
Event of Default), Pledgor shall update Annex 1.

7.6                                  The
Pledgor will not be entitled to request the summary proceedings judge (voorzieningenrechter) of the district court to order that
the Spacecraft shall be sold in a manner deviating from the provision of
section 3:250 of the Dutch Civil Code.

7.7                                  In
the event that the Pledgee forecloses or intends to foreclose the Right of
Pledge, it will not be obliged to give notice (thereof) (as provided in section
3:249 subsection (1) and section 3:252 of the Dutch Civil Code) to the Pledgor
or any person having the benefit of an encumbrance on Spacecraft comprised in
such Right of Pledge.

7.8                                  The
Pledgee shall apply the proceeds of the Spacecraft and the foreclosure of the
Right of Pledge or any of them in satisfaction of the Secured Obligations
subject to  applicable
provisions of Dutch law.  To the extent
that any proceeds remain after the satisfaction of the Secured Obligations, the
Pledgee shall promptly (and in any event within thirty (30) days after receipt
of the proceeds) pay the surplus to the Pledgor.

7.9                                  In
addition to the undertakings contained in Clause 2.3 above, the Pledgor shall
at any time, upon written request of the Pledgee execute and cause to be filed at
the expense of the Pledgor, such documents and instruments, and do such other
acts and things, as the Pledgee may reasonably deem desirable in obtaining the
full benefits of this Agreement (including the protection and preservation of
its rights hereunder) and of the rights and powers granted hereunder or granted
to a pledgee under the laws of the Netherlands.

 

7.10                           The Pledgor hereby grants to the
Pledgee (and any of its delegates) an irrevocable power of attorney in
accordance with section 3:74 (1) of the Dutch Civil Code to, following the
issuance of a Default Notice to it and during the continuance of an Event of
Default, perform all acts and execute all documents in order to perfect or
implement this Agreement on its behalf, and to take all actions which are
necessary for the Pledgee (and any of its delegates) to create, maintain,
protect, preserve and exercise its rights under this Agreement (acting
reasonably). The parties agree that section 3:68 (Selbsteintritt) of the Dutch
Civil Code will not apply and to the extent necessary, the Pledgor hereby
waives any rights it may have under section 3:68 of the Dutch Civil Code, which
waiver the Pledgee hereby accepts.

8                                           TERMINATION

8.1                                  The
Pledgee is entitled to terminate (opzeggen) in
whole or in part any Right of Pledge and the contractual arrangements set forth
herein. Notice of termination must be given in writing by the Pledgee to the
Pledgor.

8.2                                  The
Right of Pledge or any of them shall terminate by operation of law when all but
the last XXX Dollars ($XXX)
of incentive payments constituting Secured Obligations have been
unconditionally and irrevocably (other than as provided in Paragraph 5.3.C of
the NSS-8 Contract) paid to the Pledgee and discharged in full or have ceased
to exist in accordance with the NSS-8 Contract. At the request of the Pledgor,
the Pledgee shall confirm such termination to the Pledgor in writing and will
execute all documents reasonably requested by the Pledgor in relation thereto
and all reasonable costs in relation thereto shall be at the Pledgor’s expense.

However, if any payment or discharge is subsequently
avoided or must be restored on bankruptcy, liquidation or otherwise without
limitation, the Right of Pledge created hereby and pursuant hereto shall
continue as if there had been no such payment or discharge. The Pledgee (acting
reasonably) shall be entitled to concede or compromise any claim that any such
payment or discharge is subject to avoidance.

9                                           ASSIGNMENT

9.1                                  Subject
to applicable law, the Pledgee and the Pledgor shall each be entitled to assign
and/or transfer all or part of its rights and obligations under this Agreement
to any assignee and/or transferee to the extent, and subject to the
limitations, set forth in Article 26 of the NSS-8 Contract.

9.2                                  The
Pledgor and the Pledgee each hereby in advance gives its irrevocable consent to
(geeft toestemming bij voorbaat)
within the meaning of section 6:156 of the Dutch Civil Code and hereby in
advance irrevocably co-operates with (verleent
bij voorbaat medewerking aan), within the meaning of 

 

                                                 sections 6:159 and 6:156 of the
Dutch Civil Code, any such assignment and/or transfer executed in accordance
with the relevant provisions of Article 26 of the NSS-8 Contract.

10                                     CONFIDENTIALITY

The Pledgee and the Pledgor shall be entitled to
impart any confidential or proprietary information arising under or relating to
this Agreement to the same extent, and under the same conditions, as are set
forth in Article 27 of the NSS-8 Contract.

11                                     DISPUTES

Determinations regarding the existence and amount of
the Secured Obligations shall be made in accordance with Paragraph 5.E of the
NSS-8 Contract.  Any dispute arising
under this Agreement (including without limitation any dispute regarding the
existence and amount of the Secured Obligations and the Secured Obligations or
the existence of an Event of Default) shall be resolved in accordance with
Article 21 of the NSS-8 Contract.

12                                     COSTS

Subject to any provision to the contrary herein,
each party shall bear all costs incurred by it in connection with the creation
of the Right of Pledge (which, for the avoidance of doubt, in relation to the
Pledgor, includes any cost incurred in connection with Clause 2. hereof) and
the performance by the parties of their rights and obligations under this
Agreement. Any reasonable cost incurred by the Pledgee in
connection with the enforcement of any rights under this Agreement are
for the account of the Pledgor.

13                                     NOTICES

Any notices and other
communications under or in connection with this Agreement shall be given in
accordance with Article 29 of the NSS-8 Contract.

14                                     LIABILITY

NOTWITHSTANDING ANY OTHER
PROVISION HEREIN TO THE CONTRARY, NEITHER PARTY SHALL BE LIABLE, WHETHER IN
CONTRACT, TORT OR OTHERWISE, FOR SPECIAL, INCIDENTAL, INDIRECT OR CONSEQUENTIAL
DAMAGES OR FOR LOST PROFITS OR REVENUES, OTHER THAN FOR A WILFUL BREACH OR
GROSS NEGLIGENCE.

 

15                                     LIMITATION; WAIVER

The Pledgor waives, to the fullest extent permitted
by law, its right (i) to dissolve this Agreement, pursuant to section 6:265 of
the Dutch Civil Code or on any other ground or (ii) to avoid this Agreement,
including but not limited to error (dwaling),
which waiver the Pledgee hereby accepts.

16                                     SECURITY INTEREST ABSOLUTE

All rights of the Pledgee, the Right of Pledge and
all obligations of the Pledgor hereunder shall be absolute and unconditional
irrespective of:

(i)                           any
change in the time, manner or place of payment of the Secured Obligations or
any change of or amendment to the NSS-8 Contract and any other document related
thereto, or any other agreement or instrument relating to any of them; or

(ii)                        any exchange, release or non perfection of any
other collateral, or any release or amendment or waiver of or consent to any
departure from any other collateral for the Secured Obligations.

17                                     AMENDMENT
OF THIS AGREEMENT

This Agreement may only be amended by a written
agreement between the Pledgor and the Pledgee.

18                                     GOVERNING
LAW AND JURISDICTION

18.1                            This
Agreement shall be governed by and construed in accordance with the laws of The
Netherlands.

18.2                            The
Pledgor consents to the exclusive jurisdiction of the courts of Amsterdam, The
Netherlands. The Pledgor hereby waives any objection that it may now or
hereafter have to the jurisdiction of such courts, which waiver the Pledgee
hereby accepts. This Clause is for the benefit of the Pledgee only and shall
not limit its right to bring proceedings against the Pledgor in connection with
this Agreement or the NSS-8 Contract in any other court of competent
jurisdiction or (to the extent allowed by law) concurrently in more than one
jurisdiction.

 

19                                     SEVERABILITY
OF PROVISIONS

19.1                            Any
provision of this Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof or affecting the validity or enforceability of such provision
in any other jurisdiction.

19.2                            The
parties hereto agree that they will negotiate in good faith to replace any
provision hereof held invalid, illegal or unenforceable as set out in Clause
19.1 above with a valid provision which is as similar as possible in substance
to the invalid, illegal or unenforceable provision.

20                                     REMEDIES
AND PREVALENCE

20.1                            The
rights and remedies of the Pledgee herein, and the obligations, representations
and warranties of the Pledgor herein, are cumulative and are not exclusive of
any rights or remedies of the Pledgee, or obligations, representations or
warranties of the Pledgor, conferred or imposed by law or the NSS-8 Contract.

20.2                            To
the extent there is a conflict between the provisions of the NSS-8 Contract and
the provisions of this Agreement, the provisions of the NSS-8 Contract shall
prevail (but only to the extent that the validity and enforceability of the
pledges created pursuant this Agreement and the powers of attorney given
pursuant this Agreement are not affected as a consequence).

21                                     REGULATORY
MATTERS

21.1                            Notwithstanding
anything to the contrary contained in this Agreement or in the NSS-8 Contract,
the rights of the Pledgee hereunder and under Article 19 of the NSS-8 Contract
are subject to all applicable rules and regulations of the Government of the
Netherlands, the United States Department of State and other Governmental
Authorities with jurisdiction over the Pledgor, the Pledgee, their respective
subsidiaries or the Spacecraft.  Without limiting the foregoing, the
Pledgee will not take any action (or authorize any other party to take any
action on its behalf) which (i) would constitute or result in an
assignment or change of control of any governmental permits, licenses, or other
authorizations, including without limitation those issued by the Government of
the Netherlands, now held by or to be issued to Pledgor or any of its
subsidiaries, which would require prior notice to or approval from any
Governmental Authority, (ii) would constitute an export or a re-export of any
defense article (including technical data) or the provision of any defense
service unless such export, re-export or provision of defense services has been
authorized, to the extent required by law (including without limitation to the
extent required pursuant to the Export Laws) or (iii) otherwise take action
hereunder which would require prior notice to or approval from any Governmental

 

                                                 Authority, in each case without first providing such notice or
obtaining such prior approval of the relevant Governmental Authorities.

21.2                            Upon
and after the issuance of a Default Notice, the Pledgor shall take any action
that the Pledgee may reasonably request in the exercise of its rights and
remedies under this Agreement in order to transfer or assign the Spacecraft to
the Pledgee or to such qualified third party as the Pledgee may designate.  To enforce the provisions of this Clause 21,
upon and after the issuance of a Default Notice, the Pledgee is empowered to seek
from the Government of the Netherlands, the U.S. Department of State and any
other Governmental Authority, to the extent required, consent to or approval of
any involuntary assignment or a transfer of control of the NSS-8 Satellite or
of any export or re-export of any defense articles (including technical data)
or the provision of defense services. 
Pledgor agrees to use reasonable commercial efforts to cooperate with
any such purchaser and with the Pledgee in the preparation, execution and
filing of any applications and other documents, to provide any information that
may be necessary or helpful in obtaining the consents described herein, and to
consent to any involuntary transfer of control upon the request of the Pledgee
upon and after the issuance of a Default Notice.

21.3                            The
Pledgor hereby acknowledges and agrees that the Spacecraft is a unique asset
and that a violation of the Pledgor’s covenant to cooperate with respect to any
regulatory consents would result in irreparable harm
to the Pledgee for which monetary damages are not readily ascertainable.  The Pledgor further agrees that, because of
the unique nature of its undertaking in this subclause 21.3, the same may be
specifically enforced, and it hereby waives, and agrees to waive, any claim or
defense that the Pledgee would have an adequate remedy at law for the breach of
this undertaking.

21.4                            Without
limiting the obligations of the Pledgor hereunder in any respect, the Pledgor
further agrees that if the Pledgor, upon and after the issuance of a Default
Notice, should fail or refuse to execute any application or other document
necessary or appropriate to obtain any governmental consent necessary or
appropriate for the exercise of any right of the Pledgee hereunder, the Pledgor
agrees, to the extent consistent with applicable law, that such application or
other document may be executed on the Pledgor’s behalf by the Pledgee without
notice to the Pledgor.

22                                     REGISTRATION

The Pledgee is irrevocably authorised to present
this Agreement and any agreement pursuant hereto for registration to the
relevant Belastingdienst Amsterdam Afdeling Registratie Unit
in The Netherlands.

 

23                                     COUNTERPARTS

23.1                            This Agreement
may be executed in any number of counterparts and by way of facsimile exchange
or email of executed signature pages, all of which taken together shall
constitute one and the same agreement.

23.2                            This
Agreement has been entered into on this 22nd day of February 2005.

[remainder of this page intentionally left
blank]

 

	
  THE
  PLEDGOR

  	
  THE
  PLEDGEE

  
	
   

  	
   

  
	
  NEW SKIES SATELLITES B.V.

  	
  BOEING SATELLITE SYSTEMS INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
              /s/ DANIEL
  GOLDBERG

  	
   

  	
              /s/
  DENNIS BEESON

  	
   

  
	
  By:      Daniel Goldberg

  	
  By:      Dennis
  Beeson

  
	
  Title:   CEO

  	
  Title:   Manager

  
				

 

 

ANNEX 1

LIST OF
TT&C EQUIPMENT AND SOFTWARE

AS OF
____________, 20__

[to
be agreed and attached separately]

 

Exhibit I

Execution Copy

AGREEMENT
OF UNDISCLOSED PLEDGE

between

NEW SKIES SATELLITES B.V.

 

as Pledgor

and

 

BOEING SATELLITE SYSTEMS
INTERNATIONAL, INC.

as Pledgee

 

 

 

 

 

NSS-8 Customer Accounts Receivable

 

 

 

INDEX

 

	
  1

  	
  DEFINITIONS AND INTERPRETATION

  	
  3

  
	
  2

  	
  PLEDGE

  	
  5

  
	
  3

  	
  ACCESSORY RIGHTS AND ANCILLARY RIGHTS

  	
  7

  
	
  4

  	
  REPRESENTATIONS AND WARRANTIES

  	
  7

  
	
  5

  	
  UNDERTAKINGS

  	
  8

  
	
  6

  	
  CONSENT

  	
  9

  
	
  7

  	
  ENFORCEMENT AND POWER OF ATTORNEY

  	
  10

  
	
  8

  	
  TERMINATION

  	
  11

  
	
  9

  	
  ASSIGNMENT

  	
  12

  
	
  10

  	
  CONFIDENTIALITY

  	
  12

  
	
  11

  	
  DISPUTES

  	
  12

  
	
  12

  	
  COSTS

  	
  12

  
	
  13

  	
  NOTICES

  	
  12

  
	
  14

  	
  LIABILITY

  	
  13

  
	
  15

  	
  LIMITATION; WAIVER

  	
  13

  
	
  16

  	
  SECURITY INTEREST ABSOLUTE

  	
  13

  
	
  17

  	
  AMENDMENT OF THIS AGREEMENT

  	
  13

  
	
  18

  	
  GOVERNING LAW AND JURISDICTION

  	
  13

  
	
  19

  	
  SEVERABILITY OF PROVISIONS

  	
  14

  
	
  20

  	
  REMEDIES AND PREVALENCE

  	
  14

  
	
  21

  	
  REGISTRATION

  	
  14

  
	
  22

  	
  COUNTERPARTS

  	
  15

  

 

ANNEX 1              FORM
OF SUPPLEMENTAL AGREEMENT

 

 

 

 

THIS AGREEMENT OF

UNDISCLOSED PLEDGE OF NSS-8
CUSTOMER ACCOUNTS RECEIVABLES

is
dated 22 February 2005,

 

BETWEEN:

 

1                                          New Skies Satellites B.V., a private company
with limited liability (besloten vennoot­schap),
incorporated and existing under the laws of The Netherlands, with corporate
seat in Amsterdam, The Netherlands, having its registered address at
Rooseveltplantsoen 4, 2517 KR The Hague, The Netherlands, registered with the
Commercial Register under number 30146277 (“New Skies” or the “Pledgor”); and

 

2                                          Boeing Satellite Systems
International, Inc.,
a company organized under the laws of Delaware with its principal place of
business located at 2260 East Imperial Highway, El Segundo, CA, U.S.A. (“BSSI”
or “Pledgee”).

 

WHEREAS:

 

(a)                                  Pursuant to the NSS-8
Contract (as defined below), New Skies and BSSI, the parties there­to, amended
their previous agreement for the sale and purchase of the Spacecraft (as de­fined
below) to provide for, inter alia,  an amended delivery deadline and for changes
in the price, payment terms and certain other terms and conditions of the
contract;

 

(b)                                 Under the NSS-8
Contract, the entire purchase price for the Spacecraft is payable as incentive
payments during the fifteen years following the In Service Date;

 

(c)                                  As a condition to
entering into the NSS-8 Contract and in order to secure and provide for the
payment by New Skies of the Secured Obligations (as defined below), as and when
due, on the terms and subject to the conditions set forth herein and therein,
the Pledgor and the Pledgee have agreed that the Pledgor shall enter into this
Agreement of Undisclosed Pledge of NSS-8 Customer Accounts Receivable.

 

(d)                                 The parties intend to
create a sole and first ranking right of pledge on the Accounts Receivable (as
defined below). In that respect, the Accounts Receivable (as defined below) (i)
have been released from the undisclosed right of pledge on receivables created
in favour of the financial institutions which are a party to the USD
535,000,000 Credit Agreement, dated 2 November 2004 (as amended from time to
time) (the “Bank Pledge”), amongst New Skies, Deutsche Bank AG, New York Branch
and the other parties named in it as a 

 

 

 

party,
and (ii) have been excluded from the definition of “Third Party Receivables” as
contained in the Bank Pledge.

 

IT IS HEREBY AGREED AS FOLLOWS:

1                                           DEFINITIONS
AND INTERPRETATION

1.1                                  All capitalised terms
used in this Agreement, including the recitals, and not otherwise defined
herein, shall have the meaning assigned to them in the NSS-8 Contract.

1.2                                  a.                          Headings are for
convenience of reference only.

b.                       Where the context
so permits, the singular includes the plural and vice versa.

c.                           Save
where the contrary is indicated, any reference in this Agreement to a party or
the parties to this Agreement shall be construed so as to include its or their
respective permitted successors, transferees and assigns from time to time and
any permitted successor of such a successor, transferee or assign in accordance
with their respective interests, and all in accordance with the terms of the
NSS-8 Contract.

d.                          A “Clause” and a “sub clause”
shall, subject to any indication to the contrary, be construed as a reference
to a clause and subclause hereof.

e.                           References to the
NSS-8 Contract, this Agreement, or any other agreement or document shall, where
applicable, be deemed to be references to such NSS-8 Contract, this Agreement
or such other agreement or document as the same may have been, or may from time
to time be, extended, prolonged, amended, restated, supplemented, renewed or
novated.

f.                             A statute or statutory
provision shall be construed as a reference to such statute or statutory
provision as the same may have been, or may from time to time be, amended or
re-enacted and all instruments, orders, plans, regulations, by-laws,
permissions and directions at any time made thereunder.

g.                          References to the
Dutch Civil Code are references to het Nederlands Burgerlijk
Wetboek.

1.3                                  In this Agreement,
including the recitals, the following words and expressions shall have the
following meaning:

“Accounts Receivable” means any and all claims
(including, but not limited to rights to receive payments or to claim
performance judicially and extra-judicially) of the Pledgor against any customer
under any Customer Contract, whether now existing or hereafter created or
arising, in each case if or to the extent that these rights are capable of
being pledged under the laws of the Netherlands at the time of execution of
this Agreement or any Supplemental Agreement, as the case may be;

 

1

 

“Agreement” means this Agreement of Undisclosed Pledge NSS-8
Customer Accounts Receivable;

“Attorney-in-Fact” has the meaning ascribed thereto in Clause
2.6 below;

“Customer Contract” means any present or future contract for
capacity on or services employing the Spacecraft.  In the event that a contract provides for
capacity on or services employing the Spacecraft and any other capacity or
services, including ground-based capacity or services, capacity or services on
another satellite, or otherwise, the relevant Contract (a “Mixed Contract”)
shall be deemed to include only that portion of the contract that is relevant
to the capacity on or services employing the Spacecraft.  If no allocation of the payments due from the
NSS-8 Customer is set forth in the Mixed Contract, New Skies shall allocate the
payments on an equitable basis, consistent with New Skies’ general business
practices;

“Default Notice” means the default notice substantially in
the form provided by the Pledgee to the Pledgor 30 days after the date of this
Agreement at the latest and agreed between the Parties (acting reasonably)
within 10 days after that date, that is issued following an Event of Default in
accordance with Article 19 of the NSS-8 Contract and Article 7 hereof;

“Equivalent Sum” has the meaning ascribed thereto in Clause
6.3 below;

“Event of Default”
shall have the meaning set forth in the NSS-8 Contract;

“Governmental Authority” shall mean any federal, state, local
or foreign court or governmental agency, authority, instrumentality or
regulatory or legislative body;

“Material Adverse Effect” shall have the meaning set forth in the
NSS-8 Contract;

“NSS-8 Contract” means the amended and restated NSS-8
Spacecraft and Associated Equipment and Services Contract (Number NSS-20-03-01)
made between BSSI and New Skies and dated 22 February 2005;

“NSS-8 Customer” means
any third party who has a Customer Contract;

“Original Payment” has the meaning ascribed thereto in Clause
6.3 below;

“Payment Default”
shall have the meaning set forth in the NSS-8 Contract;

“Permitted Lien”
shall have the meaning set forth in the NSS-8 Contract;

“Permitted Receivables Disposals” shall have the meaning set forth in the
NSS-8 Contract;

“Pledge List” has the meaning ascribed
thereto in Clause 2.3 below;

 

 

 

“Power of Attorney” has the meaning ascribed
thereto in Clause 2.6 below;

“Rights of Pledge” means the rights of
pledge created under this Agreement, which includes, for the avoidance of
doubt, any and all pledges created pursuant to any Supplemental Agreement (as
defined below);

“Secured Obligations” means the monetary payment obligations
(verbintenissen tot betaling van een geldsom)
of the Pledgor to the Pledgee with respect to the incentive payments and
interest due to the Pledgee under Paragraphs 5.C and 5.D of the NSS-8 Contract,
including upon acceleration thereof pursuant to and in accordance with Article
19 of the NSS-8 Contract;

“Security Period” means the period beginning
on the date hereof and ending on the earlier date upon which (a) all but the
last XXX Dollars ($XXX)
of incentive payments constituting Secured Obligations have been irrevocably (other than as provided in Paragraph 5.3.C of
the NSS-8 Contract) paid
to the Pledgee and discharged in full or have ceased to exist, all in
accordance with the terms of the NSS-8 Contract, and (b) all Rights of Pledge
have been released and discharged by the Pledgee in accordance with Clause 8.2
below;

“Spacecraft” means the NSS-8 satellite to be manufactured and
delivered by BSSI to New Skies pursuant to the NSS-8 Contract; and

“Supplemental Agreement” means a Supplemental Agreement of
Undisclosed Pledge of NSS-8 Customer 
Accounts Receivable substantially in the form attached hereto as Annex 1.

2                                           PLEDGE

2.1                                  The Pledgor hereby
agrees with the Pledgee and hereby undertakes that the Pledgor shall grant to
the Pledgee the rights of pledge purported to be granted under and pursuant to
this Agreement.

2.2                                  As security for the
payment and discharge in full, as and when due (whether at stated maturity, by
acceleration or otherwise), of the Secured Obligations, the Pledgor hereby
grants, for the duration of the Security Period, to the Pledgee a first ranking
undisclosed right of pledge (stil pandrecht
eerste in rang), over all Accounts Receivable and, to the extent it
concerns future Accounts Receivable, hereby grants in advance (verpandt bij voorbaat) to the Pledgee a
first ranking right of pledge over such future Accounts Receivable and the
Pledgee hereby accepts such rights of pledge.

2.3                                  Upon the occurrence of
a Payment Default and the exercise by the Pledgee of its rights under Paragraph
19.B.3 of the NSS-8 Contract or the occurrence of an Event of Default, the 

 

 

Pledgor
shall send to the Pledgee, at the Pledgee’s first request (acting reasonably),
a computer
print out of the books of the Pledgor (each such computer print out referred to
as a “Pledge List”) stating, inter alia, the names of all NSS-8
Customers, their contact details and the outstanding amounts of the Accounts
Receivable.

2.4                                  The Pledgor
irrevocably and unconditionally undertakes to take such action (including the
execution of documents to be made up in form and sub­stance satis­fac­to­ry to
the Pledgee) as and when the Pledgee deems necessary in its reasonable opinion
from time to time to create, perfect and maintain a valid and enforceable first
priority right of pledge in favour of the Pledgee with respect to the Accounts
Receivable, including the registration and filing of this Agreement and any
Supplemental Agreement with the
Belastingdienst Amsterdam Afdeling Registratie Unit promptly upon execution thereof, and in any
event no later than 10 business days after the date of such execution or the
date of such Supplemental Agreement, and the payment of any stamp,
registration, notary or other taxes and fees in connection therewith. As soon
as reasonably practicable after such registration or filing, the Pledgee will
be provided with a copy of this Agreement or a Supplemental Agreement, as the
case may be, together with proof of registration or filing, as the case may be.

2.5                                  In addition to the
undertakings contained in Clause 2.4 above, the Pledgor irrevocably and
unconditionally undertakes to pledge to the Pledgee on a quarterly basis any
and all Accounts Receivable it will acquire after the date hereof. To the
extent necessary, in the reasonable opinion of the Pledgee, for the creation of
a pledge on any and all Accounts Receivable acquired by the Pledgor after the
date hereof, the Pledgor and the Pledgee shall enter into a Supplemental
Agreement within 30 days after the last day of each quarter as of the date of
this Agreement.

2.6                                  The Pledgee hereby
grants to the Pledgor (the “Attorney-in-Fact”)
a power of attorney (the “Power of Attorney”)
which is revocable upon written notice, to represent the Pledgee and to sign
and execute on behalf of and in the name of the Pledgee any Supplemental
Agreement materially in the form as attached hereto as Annex 1.
The parties agree that section 3:68 (Selbsteintritt)
of the Dutch Civil Code will not apply and to the extent necessary, the Pledgee
hereby waives any rights it may have under section 3:68 of the Dutch Civil
Code, which waiver the Pledgor hereby accepts. This Power of Attorney is to be
construed and interpreted as a limited power of attorney. Nothing contained in
this Power of Attorney shall be construed to grant the Attorney-in-Fact the
power to initiate or defend any suit, litigation or proceeding in the name of the
Pledgee.

2.7                                  Each of the Rights of
Pledge is one and indivisible (één en ondeelbaar).
Partial fulfilment of the Secured Obligations shall not extinguish the Rights
of Pledge proportionally.

 

 

3                                           ACCESSORY
RIGHTS AND ANCILLARY RIGHTS

The
Rights of Pledge include all accessory rights (afhankelijke
rechten) and all ancillary rights (nevenrechten)
attached to the Accounts Receivable.

4                                           REPRESENTATIONS
AND WARRANTIES

The
Pledgor represents and warrants that the following is true and correct on the
date of this Agreement:

(i)                           the Pledgor holds full and exclusive title to
the Accounts Receivable existing at the time the representation is made and is
authorised (beschikkingsbevoegd) to create a right
of pledge thereover and no Customer Contract contains or will contain a
prohibition or a restriction for the Pledgor to assign or pledge any claim
thereunder;

(ii)                        except for the Rights of Pledge created pursuant
to this Agreement and any Permitted Liens, the Accounts Receivable have not
been encumbered with any attachment (beslag) or any
rights in rem (beperkte rechten), none of the
Accounts Receivable have been assigned or pledged in advance and all Accounts
Receivable can be pledged to the Pledgee;

(iii)                     it
has the corporate power to enter into, and to perform its obligations under,
this Agreement;

(iv)                    all necessary corporate execution has been taken
by it in respect of entering into, and the performance of its obligations
under, this Agreement;

(v)                       it has validly executed this Agreement;

(vi)                    it
does not violate any provision of its articles of association by entering into,
or by performing its obligations under, this Agreement; and

(vii)                 this
Agreement creates a valid first ranking Right of Pledge, which is enforceable
in accordance with its terms and applicable law and its contractual obligations
under this Agreement are its legal, valid and binding obligations, enforceable
in accordance with their terms and applicable law.

 

 

 

5                                           UNDERTAKINGS

5.1                                  Except to the extent
permitted under this Agreement or the NSS-8 Contract with respect to Permitted
Receivables Disposals and Permitted Liens, the Pledgor undertakes not to waive
without the prior written consent of the Pledgee (not to be unreasonably
withheld, conditioned or delayed), any accessory rights (afhankelijke
rechten) or ancillary rights (nevenrechten)
attached to the Accounts Receivable and in general not to perform any acts
which could reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect.

5.2                                  Except to the extent
permitted pursuant to this Agreement or the NSS-8 Contract with respect to
Permitted Receivables Disposals and Permitted Liens, the Pledgor shall not,
without the prior written consent of the Pledgee (not to be unreasonably
withheld, conditioned or delayed), transfer or further pledge or otherwise
encumber any of the Accounts Receivable, or agree to a court settlement or an
out-of-court settlement (gerechtelijk or
buitengerechtelijk akkoord) in respect
of the Accounts Receivable.

5.3                                  Upon the occurrence of
a Payment Default and the exercise by the Pledgee of its rights under Paragraph
19.B.3 of the NSS-8 Contract or the occurrence of an Event of Default, the
Pledgor shall, at the Pledgee’s first request, provide in the English language
to the Pledgee all information and supporting documentation relating to the
Accounts Receivable and allow an independent third party designated by the
Pledgee (and acceptable to the Pledgor in its reasonable discretion), following
reasonable prior notice and during office hours, to inspect relevant
administrative records of the Pledgor, in each case to the extent required by
the Pledgee (acting reasonably) for the purpose of confirming that the Pledgor
has created, perfected and is maintaining a valid and enforceable first
priority right of pledge in favour of the Pledgee with respect to the Accounts
Receivable and that the Pledgor is in compliance with Paragraph 19.B.3 of the
NSS-8 Contract. The reasonable fees (up to an amount separately agreed with
both Parties acting reasonably), cost and expenses of any such independent
third party designated by the Pledgee shall be borne by the Pledgor.

5.4                                  The Pledgor shall
forthwith inform the Pledgee of any attachment (beslag) over any of the Accounts Receivable with an
individual or joint value of EUR 50,000 or more. The Pledgor shall:

(i)                                     send the Pledgee a copy of the relevant
attachment or seizure documentation as well as all other documents required
under applicable law for challenging the attachment or seizure (if and to the
extent possible);

(ii)                                  notify the third party or the court process
server acting on behalf of such third party in writing of the Pledgee’s
interest over the Accounts Receivable;
and

 

(iii)                               take such measures as may reasonably be required
to protect the Pledgee’s interest over the Accounts Receivable.

5.5                                  The Pledgor covenants
for the benefit of the Pledgee throughout the Security Period that it will
co-operate with the Pledgee in the collection and recovery of the Accounts
Receivable consistently with its general business practice and render all
reasonable assistance as may be required pursuant to any exchange regulations
and/or foreign statutory rules or other rules, including the taking of any
legal action that the Pledgee may deem necessary in connection therewith, in each
case after the issuance of a Default Notice to it.

5.6                                  In addition and
without prejudice to the obligations of the Pledgor pursuant to Clauses 5.3 and
5.4 above, the Pledgor shall notify the Pledgee promptly of any event or
circumstance which could reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect or otherwise cause an Event of Defualt.

6                                           CONSENT

6.1                                  In accordance with
section 3:246 of the Dutch Civil Code, following an Event of Default and
issuance by the Pledgee of a Default Notice, the Pledgor is entitled to demand
the performance judicially and extra-judicially of and to receive payment with
respect to, the Accounts Receivable until the NSS-8 Customers under the
Accounts Receivable have been notified of the Rights of Pledge. Upon the
occurrence of an Event of Default and the issuance of the Default Notice to the
Pledgor, the Pledgee is irrevocably authorised to notify the NSS-8 Customers
under the Accounts Receivable of the Rights of Pledge by sending a notification
substantially in a form provided by the Pledgee to the Pledgor 30 days after
the date of this Agreement at the latest and agreed between the Parties (acting
reasonably) within 10 days after that date. The Pledgor shall give its prompt
and full co-operation in connection herewith and it shall immediately send to
the Pledgee a Pledge List as stipulated in Clause 2.3 above. Upon such
notification of the NSS-8 Customers, the Pledgee shall be entitled to demand
the performance judicially and extra-judicially of, and to receive payment with
respect to, the Accounts Receivable and to exercise the other rights granted to
a pledgee under section 3:246 of the Dutch Civil Code in respect thereof.

6.2                                  If the Pledgee has the
right to demand the performance judicially and extra-judicially of and to
receive payment with respect to, an Account Receivable pursuant to Clause 6.1
above, it shall also have the right to enter into court settlement or
out-of-court settlement (gerechtelijk of
buitengerechtelijk akkoord) regarding such Accounts Receivable with
the NSS-8 Customer concerned.

6.3                                  If a NSS-8 Customer
makes any payment (the “Original Payment”)
to the Pledgor in respect of an Accounts Receivable after it has been notified
of the Rights of Pledge, the Pledgor shall (to the extent permitted by law)
immediately transfer to the Pledgee a sum 

 

 

equal
to the amount paid by the NSS-8 Customer to the Pledgor (the “Equivalent Sum”), without prejudice to any remedy which the
Pledgee may have against the NSS-8 Customer concerned, provided, however, that
to the extent the Pledgee has received payment of any part of the Equivalent
Sum from the Pledgor, the NSS-8 Customer will as a result be released for such
part of its payment obligation towards the Pledgee in respect of the Original
Payment.

7                                           ENFORCEMENT
AND POWER OF ATTORNEY

7.1                                  Without prejudice to
any other right or remedy available to the Pledgee, the Pledgee may issue to
the Pledgor a Default Notice upon the occurrence of an Event of Default,
wherein it may declare the Rights of Pledge immediately enforceable against the
Pledgor without any further notice of default being required and the Pledgee
may immediately exercise in respect of the Accounts Receivables any and all of
its rights and powers set out in this Agreement (subject to restrictions
following from mandatory provisions of law).

7.2                                  To the extent necessary, the Pledgor
agrees for the benefit of the Pledgee that upon an Event of Default it shall be
deemed to be in default (verzuim)
in respect of the Secured Obligations within the meaning of section 3:248 (1)
and 6:81 of the Dutch Civil Code without any further notice or action being
necessary.

7.3                                  To the fullest extent
permitted by law, the Pledgor waives (which waiver the Pledgee hereby accepts)
any right it may have (i) pursuant to section 3:234 of the Dutch Civil Code to
demand, in the event that the Pledgee enforces the Rights of Pledge, that the
Pledgee shall also enforce any other security interests (zekerheidsrechten) granted by any other
party and (ii) of requiring the Pledgee to firstly proceed against or claim
payment from any person or entity or enforce any guarantee or security granted
by any other person or entity before enforcing the Rights of Pledge and/or any
other rights under this Agreement.

7.4                                  The Pledgor will not
be entitled to request (i) the summary proceedings judge (voorzieningenrechter)
of the district court to order that the Accounts Receivable shall be sold in a
manner deviating from the provision of section 3:250 of the Dutch Civil Code or
(ii) the cantonal judge (kantonrechter)
to order that is entitled to exercise its rights with respect to the Accounts
Receivable pursuant to section 3:246 (4) of the Dutch Civil Code.

7.5                                  In the event that the
Pledgee forecloses or intends to foreclose the Rights of Pledge, it will not be
obliged to give notice (thereof) (as provided in section 3:249 and section
3:252 of the Dutch Civil Code) to the Pledgor or any person having the benefit
of an encumbrance on Accounts Receivable comprised in such Rights of Pledge.

7.6                                  The Pledgee shall
apply the proceeds of the Accounts Receivables and the foreclosure of the
Rights of Pledge or any of them in satisfaction of the Secured Obligations
subject to 

applicable
provisions of Dutch law.  To the extent
that any proceeds remain after the satisfaction of the Secured Obligations, the
Pledgee shall promptly (and in any event within thirty (30) days after receipt
of the proceeds) pay the surplus to the Pledgor.

7.7                                  In addition to the
undertakings contained in Clause 2.4 above, the Pledgor shall at any time, upon
written request of the Pledgee execute and cause to be filed, at the expense of
the Pledgor, such documents and instruments, and do such other acts and things,
as the Pledgee may reasonably deem desirable in obtaining the full benefits of
this Agreement (including the protection and preservation of its rights
hereunder) and of the rights and powers granted hereunder or granted to a
pledgee under the laws of the Netherlands.

7.8                                  The Pledgor hereby
grants to the Pledgee (and any of its delegates) an irrevocable power of
attorney in accordance with section 3:74 (1) of the Dutch Civil Code to,
following the issuance of a Default Notice to it and during the continuance of an Event of Default, perform all
acts and execute all documents in order to perfect or implement this Agreement
on its behalf, and to take all actions which are necessary for the Pledgee (and
any of its delegates) to create, maintain, protect, preserve and exercise its
rights under this Agreement (acting reasonably). The parties agree that section
3:68 (Selbsteintritt) of the
Dutch Civil Code will not apply and to the extent necessary, the Pledgor hereby
waives any rights it may have under section 3:68 of the Dutch Civil Code, which
waiver the Pledgee hereby accepts.

8                                           TERMINATION

8.1                                  The Pledgee is
entitled to terminate (opzeggen) in
whole or in part any Right of Pledge and the contractual arrangements set forth
herein. Notice of termination must be given in writing by the Pledgee to the
Pledgor.

8.1                                  The Right of Pledge or any of them shall
terminate by operation of law when all but the last XXX Dollars ($XXX) of incentive payments constituting Secured Obligations
have been unconditionally and irrevocably (other than as provided in Paragraph
5.3.C of the NSS-8 Contract) paid to the Pledgee and discharged in full or have
ceased to exist in accordance with the NSS-8 Contract. At the request of the
Pledgor, the Pledgee shall confirm such termination to the Pledgor in writing
and will execute all documents reasonably requested by the Pledgor in relation
thereto and all reasonable costs in relation thereto shall be at the Pledgor’s
expense.

However, if any payment
or discharge is subsequently avoided or must be restored on bankruptcy,
liquidation or otherwise without limitation, the Rights of Pledge created
hereby and pursuant hereto shall continue as if there had been no such payment
or discharge.  The Pledgee (acting
reasonably) shall be entitled to concede or compromise any claim that any such
payment or discharge is subject to avoidance.

 

 

9                                           ASSIGNMENT

9.1                                  Subject to applicable
law, the Pledgee and the Pledgor shall each be entitled to assign and/or
transfer all or part of its rights and obligations under this Agreement to any
assignee and/or transferee to the extent, and subject to the limitations, set
forth in Article 26 of the NSS-8 Contract.

9.2                                  The Pledgor and the
Pledgee each hereby in advance gives its irrevocable consent to (geeft toestemming bij voorbaat) within the meaning of
section 6:156 of the Dutch Civil Code and hereby in advance irrevocably
co-operates with (verleent bij voorbaat medewerking aan),
within the meaning of sections 6:159 and 6:156 of the Dutch Civil Code, any
such assignment and/or transfer executed in accordance with the relevant
provisions of Article  26 of the NSS-8
Contract.

10                                     CONFIDENTIALITY

The
Pledgee and the Pledgor shall be entitled to impart any confidential or
proprietary information arising under or relating to this Agreement to the same
extent, and under the same conditions, as are set forth in Article 27 of the
NSS-8 Contract.

11                                     DISPUTES

Determinations
regarding the existence and amount of the Secured Obligations shall be made in
accordance with Paragraph 5.E of the NSS-8 Contract.  Any dispute arising under this Agreement
(including without limitation any dispute regarding the existence and amount of
the Secured Obligations and the Secured Obligations or the existence of an
Event of Default) shall be resolved in accordance with Article 21 of the NSS-8
Contract.

12                                     COSTS

Subject to any provision
to the contrary herein, each party shall bear all costs incurred by it in
connection with the creation of the Rights of Pledge (which, for the avoidance
of doubt, in relation to the Pledgor, includes any cost incurred in connection
with Clause 2. hereof) and the performance by the parties of their rights and
obligations under this Agreement. Any reasonable cost incurred by the Pledgee
in connection with the enforcement of any rights under this Agreement are for
the account of the Pledgor.

13                                     NOTICES

Any notices and other
communications under or in connection with this Agreement shall be given in
accordance with Article 29 of the NSS-8 Contract.

 

14                                     LIABILITY

NOTWITHSTANDING ANY
OTHER PROVISION HEREIN TO THE CONTRARY, NEITHER PARTY SHALL BE LIABLE, WHETHER
IN CONTRACT, TORT OR OTHERWISE, FOR SPECIAL, INCIDENTAL, INDIRECT OR
CONSEQUENTIAL DAMAGES OR FOR LOST PROFITS OR REVENUES, OTHER THAN FOR A WILFUL
BREACH OR GROSS NEGLIGENCE.

15                                     LIMITATION;
WAIVER

15.1                            The Pledgor waives, to
the fullest extent permitted by law, its right (i) to dissolve this Agreement,
pursuant to section 6:265 of the Dutch Civil Code or on any other ground or
(ii) to avoid this Agreement, including but not limited to error (dwaling), which waiver the Pledgee hereby
accepts.

16                                     SECURITY
INTEREST ABSOLUTE

16.1                            All rights of the
Pledgee, the Rights of Pledge and all obligations of the Pledgor hereunder
shall be absolute and unconditional irrespective of:

(i)                           any change in the time, manner or place of
payment of the Secured Obligations or any change of or amendment to the NSS-8
Contract and any other document related thereto, or any other agreement or
instrument relating to any of them; or

(ii)                        any
exchange, release or non perfection of any other collateral, or any release or
amendment or waiver of or consent to any departure from any other collateral
for the Secured Obligations.

17                                     AMENDMENT
OF THIS AGREEMENT

This
Agreement may only be amended by a written agreement between the Pledgor and
the Pledgee.

18                                     GOVERNING
LAW AND JURISDICTION

18.1                            This Agreement shall
be governed by and construed in accordance with the laws of The Netherlands.

18.2                            The Pledgor consents
to the exclusive jurisdiction of the courts of Amsterdam, The Netherlands. The
Pledgor hereby waives any objection that it may now or hereafter have to 

 

the
jurisdiction of such courts, which waiver the Pledgee hereby accepts. This
Clause is for the benefit of the Pledgee only and shall not limit its right to
bring proceedings against the Pledgor in connection with this Agreement or the
NSS-8 Contract in any other court of competent jurisdiction or (to the extent
allowed by law) concurrently in more than one jurisdiction.

19                                     SEVERABILITY
OF PROVISIONS

19.1                            Any provision of this
Agreement which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof or
affecting the validity or enforceability of such provision in any other
jurisdiction.

19.2                            The parties hereto
agree that they will negotiate in good faith to replace any provision hereof
held invalid, illegal or unenforceable as set out in Clause 19.1 above with a
valid provision which is as similar as possible in substance to the invalid,
illegal or unenforceable provision.

20                                     REMEDIES
AND PREVALENCE

20.1                            The rights and
remedies of the Pledgee herein, and the obligations, representations and
warranties of the Pledgor herein, are cumulative and are not exclusive of any
rights or remedies of the Pledgee, or obligations, representations or
warranties of the Pledgor, conferred or imposed by law or the NSS-8 Contract.

20.2                            To the extent there is
a conflict between the provisions of the NSS-8 Contract and the provisions of
this Agreement, the provisions of the NSS-8 Contract shall prevail (but only to
the extent that the validity and enforceability of the pledges created pursuant
this Agreement and the powers of attorney given pursuant this Agreement are not
affected as a consequence).

21                                     REGISTRATION

21.1                            The Pledgee is
irrevocably authorised to present this Agreement and any agreement pursuant
hereto for registration to the relevant Belastingdienst
Amsterdam Afdeling Registratie Unit in
The Netherlands.

 

22                                     COUNTERPARTS

22.1                            This Agreement may be
executed in any number of counterparts and by way of facsimile exchange or
email of executed signature pages, all of which taken together shall constitute
one and the same agreement.

22.2                            This Agreement has
been entered into on this 22nd day of February 2005.

 

[remainder
of this page intentionally left blank]

 

 

 

	
  THE PLEDGOR

  	
  THE PLEDGEE

  
	
   

  	
   

  
	
  NEW SKIES SATELLITES B.V.

  	
  BOEING SATELLITE
  SYSTEMS INTERNATIONAL, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Daniel Goldberg

  	
   

  	
  /s/ Dennis Beeson

  	
   

  
	
  By:

  	
  Daniel Goldberg

  	
  By:

  	
  Dennis Beeson

  
	
  Title:

  	
  CEO

  	
  Title:

  	
  Manager

  
						

 

 

ANNEX 1

FORM
OF SUPPLEMENTAL AGREEMENT

 

THIS
SUPPLEMENTAL AGREEMENT OF UNDISCLOSED PLEDGE OF NSS-8 CUSTOMER ACCOUNTS
RECEIVABLE is dated [•]

BETWEEN:

1. New Skies Satellites B.V., a private company with
limited liability (besloten vennootschap),
incorporated and existing under the laws of The Netherlands, with corporate
seat in Amsterdam, The Netherlands, having its registered address at
Rooseveltplantsoen 4, 2517 KR The Hague, The Netherlands, registered with the
Commercial Register under number 30146277 (the 
“Pledgor”); and

2.
Boeing Satellite Systems International, Inc., a company organized
under the laws of Delaware with its principal place of business located at 2260
East Imperial Highway, El Segundo, CA, U.S.A. (“BSSI” or “Pledgee”);

WHEREAS:

pursuant to Clause 2.5
of the Master Agreement (as defined below), the Pledgor must pledge on a
quarterly basis its newly acquired Accounts Receivable  (as defined below) by entering into a
supplemental agreement of undisclosed pledge of NSS-8 Customer Accounts
Receivable;

1              DEFINITIONS
AND INTERPRETATION

1.1                                 All capitalised terms
used in this Supplemental Agreement of Undisclosed Pledge of NSS-8 Customer
Accounts Receivable (the “Agreement”),
including the recitals, and not otherwise defined herein shall have the meaning
assigned to them in the Master Agreement (as defined below).

1.2                                 In this Agreement the
following words and expressions shall have the following meaning:

                                                “Accounts Receivable” means any and all
Accounts Receivable (vorderingen op naam)
of the Pledgor not already comprised in the Rights of Pledge; and

                                                “Master Agreement” means the Agreement of
Undisclosed Pledge of NSS-8 Customer Accounts Receivable dated [ ] 200__
between the Pledgor and the Pledgee.

 

2              PLEDGE

2.1                                 The Pledgor hereby
agrees with the Pledgee and hereby undertakes that the Pledgor shall grant to
the Pledgee the rights of pledge purported to be granted under and pursuant to
this Agreement.

2.2                                 As security for the
payment and discharge in full, as and when due (whether at stated maturity, by
acceleration or otherwise), of the Secured Obligations, the Pledgor hereby grants,
for the duration of the Security Period, to the Pledgee a first ranking
undisclosed right of pledge (stil pandrecht
eerste in rang), over all Accounts Receivable and, to the extent it
concerns future Accounts Receivable, hereby grants in advance (verpandt bij voorbaat) to the Pledgee a
first ranking right of pledge over such future Accounts Receivable and the
Pledgee hereby accepts such rights of pledge.

3                                          INCORPORATION OF ALL PROVISIONS
OF THE MASTER AGREEMENT

3.1                                 All provisions of the
Master Agreement, with the exception of Clause 2.1, 2.2 and 4 of the Master
Agreement, are included in this Agreement by way of reference.

3.2                                 References in the
Master Agreement to ‘this Agreement’ shall be read as references to this
Agreement. References to ‘Accounts Receivable’ shall be read as references to ‘Accounts
Receivable’ as defined in this Agreement.

4              REPRESENTATIONS
AND WARRANTIES

4.1                                The Pledgor represents
and warrants that the following is true and correct on the date of this
Agreement and each time any future Accounts Receivable will be pledged to the
Pledgee:

(i)                                     the Pledgor holds full
and exclusive title to the Accounts Receivable existing from time to time and
is authorised (beschikkingsbevoegd) to create a
right of pledge thereover;

(ii)                                  except for the Rights of Pledge created pursuant to this Agreement and
any Permitted Liens, the Accounts Receivable have not been encumbered with any
attachment (beslag) or any rights in rem (beperkte rechten), none of the Accounts Receivable have been assigned or pledged in
advance and all Accounts Receivable can be pledged to the Pledgee;

(iii)                               it has the corporate power to enter in to, and to perform its
obligations under, this Agreement;

(iv)                              all necessary corporate execution has been taken by it in respect of
entering into, and the performance of its obligations under, this Agreement;

 

 

 

(v)                                 it has validly executed this Agreement;

(vi)                              it does not violate any provision of its articles of association by
entering into, or by performing its obligations under, this Agreement; and

(vii)                           this Agreement creates a valid first ranking Right of Pledge, which is
enforceable in accordance with its terms and applicable law and its contractual
obligations under this Agreement are its legal, valid and binding obligations,
enforceable in accordance with their terms and applicable law.

This
Agreement has been entered into on [•].

New
Skies Satellites B.V.

 

___________________________

By:

Title

 

Boeing Satellite Systems International,
Inc.

___________________________

Represented
by:

Title: Attorney-in-Fact

 

 

 

EXHIBIT
J

 

BILL OF SALE

 

	
   

  	
   

  	
  [LOGO] BOEING

  
	
  Exporter 

  Boeing Satellite Systems Int’l Inc.

  909 N. Sepulveda Boulevard 

  El Segundo, CA 90246                 91-2046588

  	
   

  	
  Contract No.

  

  Invoice No.

  XXXXX

  	
   

  	
  Program

  

  Page No. 

  1 of 1

  
	
  Consign to

  	
   

  	
  Shipment No.

  	
   

  	
  Date

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  GLA Code

  	
   

  	
  Source Code

  TL550C

  
	
   

  	
   

  	
  Packing Sheet No.

  	
   

  	
   

  
	
  Mark For

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Packing Details

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Shipped via

  	
   

  	
   

  
	
  Sold To

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  AWB No./Bill of lading

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  House AWB No.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Notify Party

  	
   

  	
  Instructions

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  County of Origin

  United States of America

  	
   

  	
  Terms

  

  Gross Weight: XXXX KGS

  	
   

  	
   

  
							

 

	
  Item

  	
   

  	
  Description

  	
   

  	
  Quantity

  	
   

  	
  Amount

  	
   

  
	
   

  	
   

  	
  Shipment Contains IATA Hazardous Materials

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  01

  	
   

  	
  Commercial Communications Satellite 

  HTS 8802.80.3000; Net Weights: XXXX kgs

  License: XXXXXX, expires 00/00/0000

  	
   

  	
  1 NO

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  02 

  	
   

  	
  Flight Hardware

  HTS 8803.90.3000; Net Weight: XX kgs

  License: XXXXXX, expires 00/00/0000

  	
   

  	
  LOT

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  TOTAL
  VALUE FOR CUSTOMS  PURPOSES:

  	
   

  	
  $

  	
  0.00 

  	
   

  
									

 

THESE COMMODITIES ARE AUTHORIZED BY THE U.S. GOVERNMENT FOR EXPORT ONLY
TO                          FOR
USE BY                            
REPRESENTATIVES. THEY MAY NOT BE TRANSFERRED, TRANSSHIPPED, ON A NON-CONTINUOUS
VOYAGE, OR OTHERWISE DISPOSED OF IN ANY OTHER COUNTRY, EITHER IN THEIR ORIGINAL
FORM OR AFTER BEING INCORPORATED INTO OTHER END-ITEMS, WITHOUT THE PRIOR
WRITTEN APPROVAL OF THE U.S. DEPARTMENT OF STATE.

 

The seller of the
above-listed property hereby warrants to the buyer of same, its successors and assigns
that, immediately prior to the delivery of this Bill of Sale, the seller was
the owner of the full, legal and beneficial title to the property and that the
seller has good and lawful right to sell the same, and that good and marketable
title to the property is hereby vested in the buyer free and clear of all liens,
security interests, claims, pledges, encumbrances and rights of others of any
nature; and the seller covenants and agrees with the buyer, its successors and
assigns, that it will warrant and defend such title forever against all claims
and demands of the seller and all other persons claiming from, through or under
the seller.

 

EXHIBIT K

 

INTENTIONALLY OMITTED

 

EXHIBIT L

 

SPECIAL TERMS AND CONDITIONS

FOR LAUNCH OF SPACECRAFT

BETWEEN

CONTRACTOR AND SEA LAUNCH

 

 

SPECIAL
TERMS AND CONDITIONS

FOR LAUNCH OF SPACECRAFT

BETWEEN CONTRACTOR AND SEA LAUNCH

 

In addition to normal and customary terms, the Launch Services
Agreement between Sea Launch and Contractor providing for the Launch of the
Spacecraft to be delivered to NSS under the Contract, contains the following
terms and conditions with respect to the launch of the Spacecraft:

 

1.                                                                                       Optional Launch for Boeing Satellite

 

NSS shall have the right to procure one (1) additional Launch on a
Sea Launch Launch Vehicle having the same capabilities as the Launch Vehicle
used to Launch the Spacecraft (XXX). The price
for such optional Launch shall be XXX Dollars ($XXX) subject to a monthly escalation rate of XXX% for each month from XXX
to the first day of the option launch period ($XXX
per month). For any option launch period that begins on a day other than the
first of the month, the price increases at a daily linear rate. Such optional
Launch shall otherwise be provided pursuant to Sea Launch’s normal and
customary terms and conditions. The option for an additional Launch must be
exercised by NSS on or before 12 months after the Effective Date of Contract.

 

2.                                                                                       Reflight or Refund Insurance

 

NSS shall be entitled to a “Reflight” or “Refund Insurance” at least XXX days prior to launch and in accordance with the
following terms:

 

Reflight. If,
as a result of the performance or nonperformance of the Sea Launch Launch
Vehicle, there is a constructive total loss of the Spacecraft

 

L-1

 

(as defined in Section 6 below, “Definitions”), Sea Launch shall
provide, without charge, Launch Services on another Sea Launch Launch Vehicle
(a “Reflight”) having performance capabilities (XXX),
and similar interface and statement of work comparable to the Launch Vehicle
used for the Spacecraft. The Parties agree that a “Reflight” launch of a Boeing
601 or 702 spacecraft will be at no additional charge to NSS, provided that the
NSS spacecraft to be launched on the Reflight is a Boeing 601 or 702 spacecraft
(and mission) that is substantially similar to one that had previously been
launched on Sea Launch. Further, there will be no additional charge to NSS to
launch a 376 spacecraft on the Reflight, provided that a substantially similar
376 spacecraft (and mission) had already been previously integrated on the Sea
Launch prior to NSS procuring a 376 spacecraft from the Contractor. The
Reflight of a substantially similar and previously integrated spacecraft shall
be capable of being performed within XXX months
after NSS’ request.   In the event that
the Boeing 601 or 702 spacecraft to be launched on the Reflight is not a
substantially similar spacecraft or mission, such Reflight shall be capable of
being performed within XXX months.
However, Contractor will put forth best efforts to improve upon the XXX month or XXX month
Reflight schedule.

 

Refund Insurance. NSS may procure through Sea Launch, insurance coverage that would
reimburse NSS (i) for the full amount paid for the Launch Services for the
Spacecraft pursuant to Paragraph 4.A. of the Contract, if, as a result of the
performance or nonperformance of the Sea Launch Launch Vehicle, the Spacecraft
is a constructive total loss (as defined in Section 6 below) or (ii) for
a portion of the amount paid for Launch Services for the Spacecraft pursuant to
Paragraph 4.A. of the Contract, if, as a result of performance or
nonperformance of the Sea Launch Launch Vehicle, the Spacecraft is a partial
loss (as defined in Section 6 below). The amount of the reimbursement for
partial loss shall be the amount paid for the Launch Services for the
Spacecraft proportionate to the reduction in operational capacity and/or expected
lifetime of the Spacecraft. The rate for such insurance shall be the lesser of
the rate obtainable in the marketplace or XXX% of the

 

L-2

 

amount paid by NSS for Launch Services for the Spacecraft pursuant to
Paragraph 4.A.

 

3.                                                                                       Termination Rights

 

The Launch Services Agreement between Sea Launch and Contractor may be
terminated with no termination fee at the direction of NSS under any one of the
following terms and conditions:

 

a.                                       Termination for Cause

 

(i)                                     after the failure of any XXX
or more of the first XXX Sea Launch
Launch Vehicles launched commencing March 15, 2001. Within 60 days
following any such failure, Contractor shall notify NSS in writing whether the
failure was related to the Launch Service. Upon receiving such notice, NSS
shall have forty-five (45) days to terminate the NSS-8 Launch;

 

(ii)                                  after the XXX failure of a Sea Launch Launch Vehicle
from among any XXX consecutive Sea Launch
launches after EDC. Within 60 days following the XXX
failure (or any subsequent failure if not earlier terminated), Contractor shall
notify NSS in writing whether the failure was related to the Launch Service.
Upon receiving such notice, NSS shall have XXX days
to terminate the NSS-8 Launch;

 

(ii)                                  if the Launch Services Provider suspends or
discontinues launches after a launch failure for a period of twelve (12) months
or more for reasons other than those specified in Paragraph 19.A. of the
Contract. This termination right will be effective upon notice by NSS given at
any time after such XXX month
suspension or discontinuance occurs or at such earlier time that it becomes
clear and apparent that launches will not be resumed without exceeding such XXX month period;

 

L-3

 

(iv)                              if a single or cumulative postponements by
the Launch Services Provider is greater than XXX months.
This termination right shall be effective upon notice by NSS to be given at any
time after such XXX month delay occurs or at
such earlier time as it becomes clear and apparent that performance by the
Launch Services Provider of its obligations under the Launch Services Agreement
cannot be accomplished without exceeding a delay of XXX months
as measured from the last day of the scheduled launch period, launch slot or
launch date as appropriate;

 

(v)                                 if the Launch Services Provider is in
material breach of any of its obligations under the Launch Services Agreement
with respect to the Launch of the NSS-8 spacecraft, provided the Launch
Services Provider fails to remedy such non-performance within XXX days of the receipt of a written notice from
Contractor regarding such non-performance; or

 

(vi)                              if the Launch Services Provider becomes
bankrupt or insolvent or has a receiving order made against it, or seeks the
protection of any law relating to bankrupt or insolvent debtors, or if an order
is made or if Launch Services Provider announces its intent to wind up
operations.

 

b.                                      Termination for Convenience

 

For a termination fee determined from the table set forth below for the
convenience of NSS, upon notice by NSS.

 

	
  Date

  	
   

  	
  TL Percentage

  	
   

  	
  TL in U.S. Dollars

  	
   

  
	
  EDC

  	
   

  	
  XXX 

  	
  %

  	
  $

  	
  XXX 

  	
   

  
	
  1 Mar 2001

  	
   

  	
  XXX 

  	
  %

  	
  $

  	
  XXX 

  	
   

  
	
  1 Apr 2001

  	
   

  	
  XXX 

  	
  %

  	
  $

  	
  XXX 

  	
   

  
	
  1 May 2001

  	
   

  	
  XXX

  	
  %

  	
   

  	
  XXX

  	
   

  
	
  1 Jun 2001

  	
   

  	
  XXX 

  	
  %

  	
  $

  	
  XXX 

  	
   

  
	
  1 Jul 2001

  	
   

  	
  XXX 

  	
  %

  	
  $

  	
  XXX 

  	
   

  
	
  1 Aug 2001

  	
   

  	
  XXX 

  	
  %

  	
  $

  	
  XXX 

  	
   

  
	
  1 Sep 2001

  	
   

  	
  XXX 

  	
  %

  	
  $

  	
  XXX 

  	
   

  
	
  1 Oct 2001

  	
   

  	
  XXX 

  	
  %

  	
  $

  	
  XXX 

  	
   

  
	
  1 Nov 2001

  	
   

  	
  XXX 

  	
  %

  	
  $

  	
  XXX 

  	
   

  

 

L-4

 

	
  1 Dec 2001

  	
   

  	
  XXX 

  	
  %

  	
  $

  	
  XXX 

  	
   

  
	
  1 Jan 2002

  	
   

  	
  XXX 

  	
  %

  	
  $

  	
  XXX 

  	
   

  
	
  1 Feb 2002

  	
   

  	
  XXX 

  	
  %

  	
  $

  	
  XXX 

  	
   

  
	
  1 Mar 2002

  	
   

  	
  XXX 

  	
  %

  	
  $

  	
  XXX 

  	
   

  
	
  1 Apr 2002

  	
   

  	
  XXX 

  	
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4.                                                                                       Deferral of Launch

 

a)                                      If the launch immediately preceding the
scheduled launch of the NSS-8 spacecraft is a failure, NSS shall have the
right to postpone the NSS-8 Launch. The rescheduled Launch shall be
mutually agreed upon by Contractor and NSS (concurrence required from the
Launch Services Provider) and shall be based upon (a) the launch schedule requested
by NSS; (b) the Launch Services Provider’s ability to perform at least XXX successful non-NSS XXX between
such failed launch and such re-scheduled NSS Launch (subject to waiver by NSS);
and (c) scheduling priority to be determined in accordance with Section 5
below. For the avoidance of doubt, the subject agreement does not grant to NSS the
guaranteed right to launch immediately following the XXX successful launch after a failure.

 

b)                                     If at any time prior to the NSS-8
Launch, the Launch Services Provider executes a contract containing more
favorable terms regarding rescheduling following a launch failure than those
offered to NSS herein (the “More Favorable Terms”), then NSS 

 

L-5

 

shall be entitled to rescheduling rights that are no less favorable
than such “More Favorable Terms.”

 

c)                                      Unless otherwise agreed to by the Launch
Services Provider, the Launch must be rescheduled to occur no later than XXX months after the NSS-8 Launch schedule at
the time of the failure. Once the Launch is rescheduled pursuant to this
section, then neither party shall have the right to postpone beyond the XXX month period.

 

d)                                     Any postponement to the NSS-8 Launch as
a result of this Article will not apply to the provisions of section 3
subpart (iv) of this Exhibit L.

 

5.                                                                                       Launch Manifest Guidelines

 

The following rules shall govern the establishment of launch schedule priorities
between Contractor and NSS and are representative of the terms Contractor has
with the Launch Services Provider.

 

a)                                      In the event of a Launch Services Provider
delay, for any reason, the launching order remains in effect as of the date of
the Launch Services Provider’s delay, excluding the following:

 

i)                                         Scientific missions which are time sensitive
in nature shall not be postponed

 

ii)                                      Reflight or replacement launches due to
previous launch failures shall be initially scheduled on a priority basis.
After the initial scheduling procedure, a reflight or replacement launch shall
maintain it’s position in the launching order and shall be treated as a
standard launch service for any subsequent Launch Services Provider
postponement.

 

b)                                     In the event of a scheduling conflict during
the initial scheduling of a launch period or launch slot due to overlapping
launch slots

 

L-6

 

between two or more customers, the Launch Services Provider customer
with the earlier contract effectivity date (for the purposes of this Contract
the contract effectivity date shall be EDC) shall have precedence.

 

c)                                      In the event of a scheduling conflict during
the scheduling of a launch period or launch slot due to postponement by
Contractor or any other Launch Services Provider customer, the Launch Services
Provider customer initially scheduled for the launch period or launch slot
shall have precedence.

 

6.                                                                                       Definitions

 

The definitions provided immediately below are applicable only to Exhibit L.

 

“Constructive Total Failure” means that the operational capacity and/or expected lifetime of the
Spacecraft is reduced by more than XXX% due to the
performance of the Launch Vehicle. The orbit and mass at liftoff specified in
the Statement of Work shall be used in the determination of expected lifetime.
The Parties shall use the Loss Formula to determine whether a Constructive
Total Failure has occurred.

 

“Loss Formula”
means a formula that calculates the loss factor in order to determine whether a
Constructive Total Failure or Partial Failure has occurred, and in the case of
Partial Failure, to compute the amount of the refund payable if Customer has
exercised a refund option. The Loss Formula shall be provided by Customer.
Customer shall provide the Loss Formula from its launch insurance policy no
later than six (6) months prior to Launch. Inclusion of the formula,
definitions, and terms shall be by mutual agreement of the Parties.

 

“Partial Failure” means that the operational capacity and/or expected lifetime of the
Spacecraft is reduced by more than XXX% but less
than or equal to XXX% due to performance of the
Launch Vehicle. The orbit and mass at liftoff specified in the Statement of
Work shall be used in the

 

L-7

 

determination of expected
lifetime. The Parties shall use the Loss Formula to determine whether a Partial
Failure has occurred, and to compute the amount of any refund payable if NSS
has exercised a refund option.

 

“Total Failure”
means that the Spacecraft was destroyed or lost, subsequent to Launch but
before separation, due to the performance of the Launch Vehicle; or, the
Spacecraft could not be separated from the Launch Vehicle.

 

L-8

 

EXHIBIT  M

 

PENDING
RDWs

 

Confidential
Treatment Requested

 

For
Entire Exhibit

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