Document:

Complete Restatement of Amended Term Sheet

 Exhibit 10.5 
  
 Complete Restatement of Amended Term Sheet 
  
 by and among 
  
 National Rural Telecommunications Cooperative (“NRTC”), 
  
 North Central Communications and Iowa Lakes Electric Cooperative, on 
 behalf of the Class certified in the United States District Court for the Central 
 District of California, Case No. CV 00-2117 (the “Class”), and 
  
 Hughes Communications Galaxy, Inc. and DIRECTV, Inc. (“DIRECTV”) 
  
 Effective as of August 5, 2003 
  
 This Complete Restatement of Amended Term Sheet (“Term Sheet”), which is effective as of August 5, 2003
(“Effective Date”), shall govern the resolution and settlement of all claims and issues currently pending in the litigation between NRTC, the Class, and DIRECTV in the United States District Court for the Central District of California,
Case Nos. CV 99-5666, CV 99-8672, CV 00-2117, CV 01-0993, and CV 01-8121 (“the Consolidated Cases”). NRTC, DIRECTV, and the Class may hereinafter be referred to collectively as the “Parties.” In consideration of the mutual
covenants set forth below, which the Parties acknowledge as good and sufficient consideration, the Parties agree as follows: 
  

	I.	Stipulated Dismissal Of All Claims: The Parties agree to dismiss with prejudice, except as set forth in the following paragraph, all their respective claims against
each other in the Consolidated Cases pursuant to the settlement outlined in this Term Sheet. The Class shall dismiss with prejudice, except as set forth in the following paragraph, all of its claims through a Judgment of Dismissal based upon the
Parties’ settlement, subject to Court approval. Settlement of NRTC’s claims and DIRECTV’s counterclaims is contingent upon settlement of the Class’s claims and Court approval of the Class settlement, and a Judgment of Dismissal
shall be entered only thereafter. 

  
 For
purposes of clarity and not in limitation of the foregoing, the Parties agree that NRTC’s and the Class’s claims for existing or known “Advanced Services” (as that term is used in NRTC’s and the Class’s complaints in
Case Nos. CV-99-8672 and CV-00-2117, respectively), including Advanced Services identified in the litigation, are dismissed with prejudice. NRTC’s and the Class’s claims for 

 
future “Advanced Services” (as that term is used in NRTC’s and the Class’s complaints in Case Nos. CV-99-8672 and CV-00-2117,
respectively), are dismissed without prejudice. Notwithstanding the foregoing, NRTC and the Class will receive revenues from TiVo services and Wink services as provided in Section IV of this Term Sheet. Moreover, the Parties agree to negotiate in
good faith regarding the marketing, sale or distribution by NRTC and the Class through NRTC of future Advanced Services that DIRECTV may offer during the term of the New DBS Distribution Agreement, when such Advanced Services are available for
marketing, sale or distribution. 
  

	II.	Amendment of the DBS Distribution Agreement: NRTC and DIRECTV agree to amend the existing DBS Distribution Agreement (as defined below) as follows:

  

	 	(a)	The Successor ROFR provision (§ 15), the definition of “Satellite” (§ 2.01), and the last three words of the first sentence, and all of the remainder, of Section
4.06(a) Service Term shall be deleted. 

  

	 	(b)	The last three words of the first sentence of Section 4.06(a) shall be replaced with “Termination Date”. The subsequent portion of Section 4.06(a) shall be replaced with a
provision that states that unless the Existing DBS Distribution Agreement (as amended hereby) is terminated, is canceled, or expires earlier pursuant to other provisions of the Existing DBS Distribution Agreement (as amended hereby), the term shall
continue until the date of termination of the Existing DBS Distribution Agreement, as amended hereby (“Termination Date”), which Termination Date shall be the later to occur of (x) the date on which (i) the remaining fuel on board DBS-1 is
less than 6% of the initial fuel mass prior to launch, including reasonable provision for uncertainty in estimation of fuel plus a credit for fuel used in the move of DBS-1 to 110° and back to 101°, or (ii) there are fewer than eight (8)
Transponders on DBS-1 capable of meeting the transponder performance specifications of the respective Users or capable of providing Transponder Capacity that meets the Minimum Requirements; or (y) June 30, 2008. 

  

	 	(c)	The substitution provision in paragraph 1 of the 1994 Amendment to the Existing DBS Distribution Agreement concerning HBO, Cinemax, Showtime and the Movie Channel, will be deleted.

  

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	 	(d)	DIRECTV agrees that if, at any time during the terms of the Existing DBS Distribution Agreement, as amended hereby, or the New DBS Distribution Agreement (as defined below), DIRECTV
relocates any of the specific single NTSC-source programming channels listed on Exhibit Z attached hereto (the “Exhibit Z Channels”) to a DBS frequency or orbital location other than the 27 HCG Frequencies, the revenue share (including
responsibility for programming costs) shall continue to be covered by those terms of the Existing DBS Distribution Agreement and New DBS Distribution Agreement applicable to services transmitted on the HCG Frequencies in NRTC Territories for such
Exhibit Z Channels, despite such relocation. 

  
 It
is understood that the intent of this provision is to provide NRTC with assurance regarding its share of the revenues received from distribution of the Exhibit Z Channels on the DIRECTV DBS platform to the extent such distribution occurs, but in no
event shall this provision be interpreted to require DIRECTV to continue distribution of any of the Exhibit Z Channels. 
  

	 	(e)	The DBS Distribution Agreement, as amended to date, including by the 1994 Amendment (as so amended, the “Existing DBS Distribution Agreement”), shall be amended to state
specifically that, with respect to new programming launched on the platform after August 11, 2003, DIRECTV will provide NRTC with a pro rata share of (i) unconstrained launch support payments (i.e. cash payments or cancellation of indebtedness
DIRECTV actually receives from a programmer in conjunction with the launch of the programmer’s service with no restrictions on DIRECTV’s use of the funds), with no restrictions on NRTC’s use of the funds and (ii) constrained launch
support payments (i.e., cash payments or cancellation of indebtedness which must be applied to promote such new services locally (as contrasted with national promotions)), which NRTC or its DBS participants must use in the manner prescribed by the
provider of such programming services. If receipt of any such payments would require NRTC or its DBS participants to incur obligations beyond the amount distributed to them, they shall have a right to elect not to receive such payment. NRTC’s
pro rata share shall be determined based upon the method used in the programming agreement to calculate the launch fee payments. For example, if the programming agreement provides a fixed launch fee amount, NRTC’s pro rata share shall be based
on the 

  

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 percentage of NRTC households divided by total households in the United States. If the programming
agreement provides a per subscriber launch fee payment based on actual subscribers to the programmer’s service, NRTC’s pro rata share shall be based on the actual number of NRTC subscribers divided by the total number of subscribers to
that particular service. NRTC agrees that it will pass on to DBS participants, in the same pro rata manner as set forth above, without deduction or charge for any NRTC margin, (i) any such unconstrained launch support payments and (ii) any such
constrained launch support payments as may, in accordance with the terms and conditions thereof, be passed on to such DBS participants, provided that such DBS participants use such constrained launch support payments in the manner specified by the
providers thereof. NRTC agrees not to argue that it is entitled to any other types of payments DIRECTV receives from programmers (as contrasted to its right to be assured that DIRECTV is billing NRTC for DIRECTV’s actual cost of Programming
Services or Standard Services net of all applicable discounts, rebates, price breaks or similar provisions of programming agreements), under any other provision of the Existing DBS Distribution Agreement, as amended, including but not limited to
Sections 3.03, 3.05, 5.02, and 5.03 of the 1992 DBS Distribution Agreement and Paragraphs 3(I)(b), 3(III)(c), and 3(III)(f) of the 1994 Amendment. Advertising revenue will be shared as provided in Section 5.04 based on the 22 Programming Services
identified in the attachment to the 1994 Amendment (as may be substituted from time to time in accordance with ¶ 1 of the 1994 Amendment, as amended hereby). 
  

	III.	New DBS Distribution Agreement: In place of Section 15 and the Successor ROFR, the NRTC and DIRECTV will enter into a new DBS distribution agreement (the “New DBS
Distribution Agreement”), on the same economic and other terms as the Existing DBS Distribution Agreement, modified to reflect the provisions of this Term Sheet, which will provide for the following: 

  

	 	(a)	The term of the New DBS Distribution Agreement shall commence on the end of the term of the Existing DBS Distribution Agreement, as amended hereby, and shall end on June 30, 2011,

  

	 	(b)	DIRECTV shall have no further obligation to NRTC after June 30, 2011, other than any obligations that accrue prior to such date or 

  

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survive termination, including the provisions set forth in this Section III, 

  

	 	(c)	NRTC will work to assure that subscribers in NRTC territories are transferred to DIRECTV effective as of June 30, 2011, or December 31, 2009, as applicable,

  

	 	(d)	The New DBS Distribution Agreement will include terms covering a transition process to assure the transfer of subscribers to DIRECTV at the end of the term of the New DBS
Distribution Agreement. NRTC will be obligated to cooperate with this transition process and will agree not to sell or market to any of the subscribers services which such subscribers have received pursuant to the New DBS Distribution Agreement or
sell or share any related information about these subscribers to any third party other than DIRECTV and to make such information available to DIRECTV. At the end of the term of the New DBS Distribution Agreement, DIRECTV agrees to pay $150 for each
subscriber successfully transferred to DIRECTV at such time, provided that the subscribers transferred meet a reasonable aging period of no greater than 45 days past due, and are subject to a charge-back if any of these subscribers, acquired in the
prior 6 months, churn within 90 days after transfer to DIRECTV, provided, however, that DIRECTV shall have no obligation to pay $150 for subscribers transferred to DIRECTV for any DBS participant which chooses Option 2, as defined in Section III (e)
below. The $150 per subscriber payment will be paid by DIRECTV to NRTC, and NRTC will pass such payment on to each affected DBS participant upon successful transfer by such DBS participant of its subscribers to DIRECTV and upon final settlement
between NRTC and such DBS participant of any amounts owing by such DBS participant to NRTC, 

  

	 	(e)	The New DBS Distribution Agreement will provide that NRTC may (and NRTC agrees that it shall) offer to each member of the Class, and each other DBS participant which accepts the
settlement, a new Member Agreement (“New Member Agreement”) in a form materially consistent with the existing Member Agreement (except as modified herein). The New Member Agreement must be approved by DIRECTV, which approval shall not be
unreasonably withheld, and will include one of the following two options (each DBS participant accepting this settlement must choose Option 1 or Option 2 by notice sent to NRTC on or before January 14, 2005). The New DBS

  

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Distribution Agreement will also provide that NRTC may itself serve, or offer to other members or affiliates of NRTC New Member Agreements for, the
territories of any non-accepting DBS participants (or accepting DBS participants who do not execute a New Member Agreement (with either Option 1 or 2, which can be selected by notice sent on or before January 14, 2005) within 60 days after approval
of this settlement and this Term Sheet by the Court, or who rescind their New Member Agreements under the provisions of Section VI below, for the period comprising the term of the New DBS Distribution Agreement, on the same terms as the New Member
Agreements. 

  
 Option
1: The New Member Agreement will include: (i) a term commencing at the end of the term of its existing Member Agreement and ending on June 30, 2011, on the terms and other provisions set forth in its Member Agreement, as amended by the
provisions of this section, provided such Class member or other DBS participant is in good standing with NRTC at the end of the term of its existing Member Agreement(s); (ii) the releases provided for in Section VII below, to be effective upon
execution of the New Member Agreement; (iii) such DBS participant’s agreement to indemnify and hold NRTC, its officers and directors, harmless from and against any and all damages, liabilities, costs and expenses, including attorneys’ fees
and expenses, which any of them may incur or be obligated to pay or indemnify on account of any claim asserted, or suit brought by, such DBS participant or any of its affiliates, against DIRECTV or any of its affiliates, as to which DIRECTV seeks
indemnification from NRTC under the Existing DBS Distribution Agreement, as amended hereby, or under the New DBS Distribution Agreement, which indemnification provision shall be effective upon the execution of the New Member Agreement; (iv) the DBS
participant will work to assure that subscribers in its territories are transferred to DIRECTV effective as of June 30, 2011, including (a) cooperating in the transition process negotiated by NRTC and DIRECTV pursuant to Section III(d) above, and
(b) making information regarding its subscribers available to DIRECTV; and (v) the DBS participant cannot during the term of the New Member Agreement and for a period of two years thereafter: (a) share or sell their list of former and/or current DBS
customers (or any portion thereof) to a multi-channel video provider other than DIRECTV; (b) (except if allowed under the existing Member Agreement during the term thereof) market or solicit sales for multi- 
  

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 channel video services or the related receiving equipment (other than DIRECTV services and associated
equipment); or (c) share or sell their customer list related to non-DBS businesses to any multi-channel video distributor, unless all former and current DBS customers are excised from such list (i.e., no then current or former (within the prior two
year period) DBS customer shall be included in a list sold to a multi-channel video distributor, even if such customer is/was a customer to a non-DBS business as well). For purposes of this settlement, Option 1 is the default Option, meaning that
for any DBS participant which signs a New Member Agreement and does not indicate which Option it chooses, Option 1 shall apply. 
  
 Option 2: The New Member Agreement will include: (i) a term commencing at the end of the term of its existing Member Agreement and
ending on December 31, 2009, on the terms and other provisions set forth in its Member Agreement, as amended by the provisions of this section, provided such Class member or other DBS participant is in good standing with NRTC at the end of the term
of its existing Member Agreement(s); (ii) the releases provided for in Section VII below, to be effective upon execution of the New Member Agreement; (iii) such DBS participant’s agreement to indemnify and hold NRTC, its officers and directors,
harmless from and against any and all damages, liabilities, costs and expenses, including attorneys’ fees and expenses, which any of them may incur or be obligated to pay or indemnify on account of any claim asserted, or suit brought by, such
DBS participant or any of its affiliates, against DIRECTV or any of its affiliates, as to which DIRECTV seeks indemnification from NRTC under the Existing DBS Distribution Agreement, as amended hereby, or under the New DBS Distribution Agreement,
which indemnification provision shall be effective upon the execution of the New Member Agreement; (iv) the DBS participant will work to assure that subscribers in its territories are transferred to DIRECTV effective as of December 31, 2009,
including (a) cooperating in the transition process negotiated by NRTC and DIRECTV pursuant to Section III(d) above, and (b) making information regarding its subscribers available to DIRECTV; (v) the DBS participant cannot during the term of the New
Member Agreement and for a period of two years thereafter: (a) share or sell their list of former and/or current DBS customers (or any portion thereof) to a multi-channel video provider other than DIRECTV, or (b) share or sell their customer list
related to non-DBS 
  

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 businesses to any multi-channel video distributor, unless all former and current DBS customers are
excised from such list (i.e., no then current or former (within the prior two year period) DBS customer shall be included in a list sold to a multi-channel video distributor, even if such customer is/was a customer to a non-DBS business as well);
and (vi) the DBS participant cannot during the term of the New Member Agreement (except if allowed under the existing Member Agreement) market or solicit sales for multi-channel video services or the related receiving equipment (other than DIRECTV
services and associated equipment). With respect only to any members of the Class who choose Option 2 as part of the settlement, the transfer of subscribers to DIRECTV at December 31, 2009 under this Option 2 shall not be deemed a Liquidity Event
within the meaning of this Term Sheet. 
  
 NRTC and DIRECTV
further agree that any DBS participant that accepts or is bound by the settlement and does not execute a New Member Agreement shall remain subject to its existing Member Agreement(s), but NRTC will agree with such DBS participant that the term of
such Member Agreement(s) will extend until the Termination Date, unless terminated by NRTC pursuant to section 14 thereof, as a result of a breach by such DBS participant thereunder. 
  

	IV.	Amendment to Seamless Consumer Agreement; Wink Services: 

  

	 	(a)	NRTC and DIRECTV agree to amend the Seamless Consumer Agreement between NRTC and DIRECTV (dated October 3, 2001, as amended through the date hereof) such that the term of the
Seamless Consumer Agreement extends through June 30, 2011, and to delete the provisions of sections D1(c) and D1(d) of the Seamless Consumer Agreement. The Revenue Share from sales of services covered by the Seamless Consumer Agreement (except
Non-Select Sports Programming) shall be adjusted to the greater of 15% or the rate applicable pursuant to the Service Penetration Rate calculation described therein. The Seamless Consumer Agreement will also cover TiVo and Para Todos at a 15%
Revenue Share, plus incremental Revenue Share up to a maximum Revenue Share of 20%, and NRTC and DIRECTV shall agree upon the appropriate Base Service Penetration Rates for such incremental Revenue Share calculation, designed to provide incentive to
NRTC to improve from DIRECTV’s current penetration rate in NRTC territories for such services in a 

  

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manner consistent with the Service Penetration Rate applicable to the other services covered by the Seamless Consumer Agreement. NRTC will no longer have an
obligation to pay DIRECTV for programming costs for Para Todos. If Pegasus agrees to the terms of this settlement, the Pegasus/DIRECTV Seamless Consumer Agreement shall be amended in accordance with this paragraph; otherwise it will remain
unchanged. 

  

	 	(b)	The Parties acknowledge and agree that the agreement dated September 15, 2000 between NRTC, Pegasus and DIRECTV (the “Wink Agreement”) remains in full force and effect and
shall continue, pursuant to its terms, through the term of the referenced Master Affiliation Agreement between DIRECTV and Wink Communications, Inc. The Parties further agree to negotiate in good faith regarding the marketing and sale of the Wink
services by NRTC and/or the Class on substantially equivalent terms to the Wink Agreement, should DIRECTV renegotiate or otherwise undertake a new agreement for the distribution of the Wink services on the DIRECTV platform on substantially similar
terms to the Master Affiliation Agreement during the term of the New DBS Distribution Agreement. 

  

	V.	Business Continuity Provision: In the event that at any time prior to June 30, 2011, as a result of any “Liquidity Event” any then current subscribers to
DIRECTV service of any Member(s) or DBS participant(s) (who are parties to a Member Agreement or a New Member Agreement) are successfully transferred to or acquired by DIRECTV (including for these purposes any parent, subsidiary, affiliate,
successor or assign of DIRECTV), DIRECTV agrees that it will pay to NRTC an amount per month for each month thereafter through June 30, 2011, calculated by multiplying $2.70 by the number of subscribers so transitioned to DIRECTV in or as a result
of any such Liquidity Event. As used herein, a “Liquidity Event” means and includes any direct or indirect transfer of any subscribers of any Member(s) or DBS participant(s) who are parties to a Member Agreement or a New Member Agreement
to DIRECTV (directly or indirectly through any parent, subsidiary or other affiliated entity or successor or assign), whether by acquisition of assets of any such Member(s) or DBS participant(s) or its rights under any Member Agreement(s) or new
Member Agreement(s), by purchase of capital stock, in a merger or consolidation, by direct or indirect acquisition of control of any such Member or DBS participant or any direct 

  

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or indirect parent thereof, in any bankruptcy or reorganization proceeding, upon any default of any such Member or DBS participant under section 3.10(b) of
the Existing DBS Distribution Agreement, any corresponding provision of the New DBS Distribution Agreement or otherwise. Notwithstanding the foregoing, the transfer of subscribers to DIRECTV by any member of the Class selecting Option 2, as defined
in Section III (e) at December 31, 2009, shall not be deemed a Liquidity Event, and DIRECTV will have no obligation to make the payment provided in the first sentence of this section for any such subscribers after December 31, 2009. For clarity,
with respect to any Class member which elects Option 2, if a Liquidity Event occurs before December 31, 2009, then such event will still be a Liquidity Event with respect to the subscribers of such Option 2 Class members; however, in any such event
DIRECTV will only be obligated to make the payments to NRTC provided for in the first sentence of this Section V with respect to such subscribers for the period from the date of such Liquidity Event through December 31, 2009. Upon the occurrence of
a Liquidity Event or transfer under Option 2, territory with respect to which the Liquidity Event or transfer under Option 2, has occurred shall cease to be NRTC territory and shall become DIRECTV territory and no further obligations shall arise
between the parties under the New DBS Distribution Agreement or any Member Agreement or New Member Agreement with respect to such territory. Upon the occurrence of a Liquidity Event, or transfer under Option 2, NRTC will be obligated to cooperate in
the transfer of subscribers to DIRECTV and will agree not to sell or market to any of the subscribers services which such subscribers have received pursuant to the New DBS Distribution Agreement or sell or share any related information about these
subscribers to any third party other than DIRECTV. 

  

	VI.	Approval: 

  

	 	(a)	All the terms set forth in this Term Sheet are subject to approval by the Class and approval of the settlement by the Court after notice and a hearing. Inasmuch as the Class
Representatives and Class counsel have approved and executed this Term Sheet, the Class Representatives, joined as appropriate by NRTC and DIRECTV, will promptly request permission from the Court to notify the Class members of the potential
settlement of the Class claims. If the Court approves such notice, the Class Representatives or Class counsel, as appropriate, will promptly serve the required notice(s) of the proposed 

  

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settlement to the Class members and take all such other actions necessary to arrange for the required fairness hearing. 

  

	 	(b)	To the extent that, and only if, the Court’s order or judgment approving the Class settlement is set aside by a final order or decision (a “Final Reversal”) of a
higher court on appeal or by the Court itself on remand or reconsideration (and provided such order or decision is not itself reversed and the settlement is not ultimately and finally approved), then the following shall apply:

  
 1. The mutual releases and the
dismissals between the Class and DIRECTV provided for in this Term Sheet shall not be effective; 
  
 2. (i) Any Class Member may, by notice provided to NRTC within 60 days after the date of entry of a Final Reversal, rescind its New Member
Agreement, with the effect that (x) the mutual releases of NRTC and such Class Member set forth therein shall be void ab initio, and (y) neither NRTC nor such Class Member shall have any further obligations under the New Member Agreement, except
that each party reserves all rights with respect to any of the obligations, if any, of the other party that accrued thereunder prior to the effective date of such rescission; and 
  
 (ii) NRTC may, by notice provided to all Class Members within 90 days after the date of entry of a Final
Reversal and to the extent permitted by applicable law or the terms of any Final Reversal, propose amendments to the New Member Agreement to address any issues raised by a Final Reversal, and any Class Member may, within 30 days of receipt, accept
such amended New Member Agreement; 
  
 3. Any and
all statutes of limitations and other time bars pertaining to any claims by or against any or all Class Members, which this Term Sheet contemplates will be released and/or dismissed but which ultimately are voided under sub-paragraphs 1 or 2 above,
shall be deemed tolled from the date of entry of the dismissals through the date of entry of a Final Reversal, as set forth above; and 
  
 4. NRTC and DIRECTV agree that the settlement between NRTC and DIRECTV shall remain binding notwithstanding the entry of a Final Reversal
regarding the approval of the Class settlement. 
  

	VII.	Mutual Releases: The Parties agree to execute appropriate settlement and 

  

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amendment agreements, consistent with the provisions of this Term Sheet, and appropriate mutual releases, including a waiver of the benefits of California
Civil Code § 1542, with respect to the claims referenced above. The New Member Agreements will also include (1) an appropriate release by NRTC of known claims against such DBS participant (but specifically excluding claims related to payments
due and ongoing operational matters) and (2) an appropriate release by such DBS participant of NRTC, its officers and directors (including with regard to (i) the terms of this settlement, (ii) the dismissal of the Consolidated Cases and (iii) any
and all known claims, whether asserted or unasserted, arising out of or relating to (x) any dealings between NRTC and such DBS participant under its Member Agreement(s) through the date such DBS participant executes and delivers such New Member
Agreement, and including, but not limited to, any such claims arising out of or relating to NRTC’s provision of services to such DBS participant thereunder, the amounts, including margin, charged by NRTC to such DBS participant thereunder,
and/or NRTC’s use or distribution to DBS participants of any launch or marketing support fees collected by NRTC and/or (y) NRTC’s method of calculation and allocation of patronage and non-patronage sourced income, and NRTC’s
calculations and distributions of net savings to its patrons), and including a waiver of the benefits of California Civil Code §1542, or comparable provisions of the laws of any other jurisdictions, with respect to the matters referenced above.
The terms of this settlement shall be deemed an accord and satisfaction with respect to all amounts claimed as damages or restitution in the litigation. 

  

	VIII.	Indemnity: Notwithstanding anything to the contrary in the indemnification provisions of the Existing DBS Distribution Agreement: 

  

	 	(a)	NRTC and DIRECTV each will bear its own attorneys’ fees and related defense costs with respect to obtaining Court approval of the settlement terms and defending against any
claim, in any court, relating to or arising out of the settlement. In addition, NRTC agrees to indemnify DIRECTV with respect to any final judgment entered against DIRECTV in favor of any current DBS participant which challenges the settlement.
Subject to the previous sentences, NRTC will continue to pay DIRECTV’s attorneys’ fees and associated defense costs with respect to the existing claims of Pegasus Satellite Television (or any of its affiliates) in its existing case against
DIRECTV (case no. CV-00-0368 LGB) and will indemnify DIRECTV against any judgment entered in it. 

  

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	 	(b)	NRTC and DIRECTV agree that NRTC shall not be required to pay any further defense costs, including attorneys’ fees, associated with the Delaware patent case. NRTC agrees not to
seek reimbursement for any defense costs paid by NRTC to date with respect to the Delaware patent case. NRTC will not be required to indemnify DIRECTV with respect to any judgment entered in the Delaware patent case unless and until a court has
entered a final judgment that NRTC has such an obligation. NRTC’s failure to indemnify DIRECTV concerning a judgment in the Delaware patent case, prior to a final judgment that it has such an obligation, will not be an NRTC Event of Default
under the Existing DBS Distribution Agreement or the New DBS Distribution Agreement or otherwise provide DIRECTV with any power or right to terminate or cancel either agreement. NRTC and DIRECTV agree that the dismissal, with prejudice, of CV01-8121
will not preclude NRTC from disputing it has the obligation to indemnify DIRECTV against any judgment in the Delaware patent case or DIRECTV from arguing that NRTC does have the obligation to indemnify DIRECTV against such judgment.

  

	 	(c)	If DIRECTV or any affiliate(s) or successor(s) in interest acquires (directly or indirectly) all or substantially all of the subscribers being serviced by Pegasus Satellite
Television and its affiliates (or control of Pegasus and/or any of its affiliates serving all or substantially all of the subscribers being serviced by Pegasus and its affiliates) as a result of any Liquidity Event or other act or event, then any
indemnification obligation of NRTC relating to Pegasus Satellite Television or any of its affiliates shall terminate, except for obligations already incurred. 

  

	IX.	Authority/Agreement To Be Bound: Each of the Parties executing this Term Sheet represents that: i) it has full power and authority to enter into this settlement; ii)
the settlement terms do not violate any charter provisions, by-law, contractual provision or other term by which it is bound; iii) with the exception of the Class, the approval of which must be obtained in accordance with Section VI above, it has
obtained the necessary approvals to enter into this settlement; and, iv) the person executing the Term Sheet on its behalf is duly authorized to do so. Upon execution, this Term Sheet shall be binding upon all Parties, subject to Court approval and
Class approval. The Parties agree to negotiate the agreements, and amendments described above in good faith to reflect the above stated terms, including to make any conforming changes to any other applicable provisions of the Existing DBS

  

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Distribution Agreement and to correct any inadvertent and unintended changes to other provisions of the Existing DBS Distribution Agreement. If, however, a
formal settlement agreement is not reached, this Term Sheet (and the terms recited herein shall be (as appropriate in each instance) incorporated into the Member Agreements, the Existing DBS Distribution Agreement, and the Consumer Seamless
Agreement) shall remain binding upon all Parties and have the effect of amendments thereto. 

  

	X.	Offer of Future Sales Agency: DIRECTV agrees that, upon the expiration of any New Member Agreement as of June 30, 2011, DIRECTV shall offer to the applicable
DBS participant thereunder the opportunity to act as a DIRECTV retailer, on terms at least equivalent to DIRECTV’s then standard terms for its two-step/independent retailers who sell DIRECTV exclusively, provided that such DBS participant
continues to observe the restrictions set forth in Section III(e) (iv) and (v) (Option 1). 

  

	XI.	Certain Agreements with Pegasus: If there are any changes or additions to the Existing DBS Distribution Agreement, as amended hereby, or the New DBS Distribution
Agreement or the Member Agreements with Pegasus Satellite Television, Inc, and its affiliates (“Pegasus”) (which are approved by NRTC as the other party thereto) or the Seamless Consumer Agreement between DIRECTV and Pegasus, as a result
of a settlement between DIRECTV and Pegasus of the current litigation (excluding Seamless Marketing and the Delaware patent claims) between them, other than as set forth in this Term Sheet, DIRECTV will advise NRTC and the Class of all the precise
terms thereof and agrees that, if NRTC and the Class elect, DIRECTV will make such terms, rights and benefits available to NRTC and through NRTC to the Class and any other DBS participant which accepts this settlement, provided that the party agrees
to undertake any obligations associated with such terms, rights and benefits. Notwithstanding the foregoing, it is expressly agreed that the provisions of this Section XI shall not apply to the terms of any Liquidity Event transaction which may be
entered into between DIRECTV and Pegasus. 

  
 This
Term Sheet, when executed, shall supersede and replace the Term Sheet dated as of August 5, 2003 (the “Original Term Sheet”), the First Amendment to Term Sheet executed as of August 11, 2003 and the Second Amendment to Term Sheet dated as
of September 18, 2003 in their entirety; however, any failure to execute this Term Sheet shall not affect the binding effect of the Original Term Sheet, as amended by the First Amendment to Term Sheet and the Second Amendment to Term Sheet. This
Term Sheet may be executed in 
  

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one or more counterparts, each or which shall be deemed an original. All Parties agree that facsimile signatures by any Party shall be acceptable.

  
 The rest of this page is intentionally left blank. Signatures are on the
following pages. 
  

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	NATIONAL RURAL TELECOMMUNICATIONS COOPERATIVE
		
	By:	 	/s/ B. R. Phillips III
	 	

	Name:	 	B. R. Phillips III
	Title:	 	President and CEO
	Date:	 	September 23, 2003
	
	NORTH CENTRAL COMMUNICATIONS
		
	By:	 	/s/ F. Thomas Rowland
	 	

	Name:	 	F. Thomas Rowland
	Title:	 	President & CEO
	Date:	 	9/19/03
	
	IOWA LAKES ELECTRIC COOPERATIVE
		
	By:	 	/s/ Terry L. Bruns
	 	

	Name:	 	Terry L. Bruns
	Title:	 	Exec. V.P. & G.M.
	Date:	 	09/23/03
	
	DIRECTV, INC.
		
	By:	 	/s/ Roxanne S. Austin
	 	

	Name:	 	Roxanne S. Austin
	Title:	 	President and COO
	Date:	 	September 23, 2003
	
	HUGHES COMMUNICATIONS GALAXY, INC
		
	By:	 	/s/ Robert M. Hall
	 	

	Name:	 	Robert M. Hall
	Title:	 	Vice President
	Date:	 	September 23, 2003

  

 16 

 EXHIBIT Z 
  
 STARZ! East 
  
 STARZ! West 
  
 STARZ! Theater East 
  
 BLACK STARZ! 
  
 A Taste of Spice (Adult) 
  
 PLAYBOY TV (Adult) 
  
 Spice Platinum (Adult) 
  
 The Hot Network (Adult)

  
 The Hot Zone (Adult)Form of Third Supplemental Indenture

 EXHIBIT 4.1 
  

BP Capital Markets p.l.c., 
 Company 
  
 AND 
  
 BP p.l.c., 
 Guarantor 
  
 TO 
  
 JPMorgan Chase
Bank, 
 Trustee 
  

  
 Form of Third Supplemental Indenture

  
 Dated as of November ·, 2003 
  

  
 Supplement to Indenture Dated as of March 8, 2002 
  
 2.75% Guaranteed Notes due December 29, 2006 

 THIRD SUPPLEMENTAL INDENTURE 
  
 THIRD SUPPLEMENTAL INDENTURE, dated as of November ·, 2003, among BP Capital Markets p.l.c., a corporation duly organized and existing under the laws of England and Wales (herein called the “Company”), having its principal office at Breakspear Park,
Breakspear Way, Hemel Hempstead, Herts HP2 4UL, England, and BP p.l.c., a corporation duly organized and existing under the laws of England (herein called the “Guarantor”), having its registered office at 1 St. James’s Square, London
SW1Y 4PD, England, and JPMorgan Chase Bank, a corporation duly organized and existing under the laws of the State of New York, having its Corporate Trust Office at 4 New York Plaza, New York, New York 10004, as Trustee (herein called the
“Trustee”) under the Base Indenture (as hereinafter defined). 
  
 RECITALS OF THE COMPANY 
  
 WHEREAS, the Company and the
Guarantor have heretofore executed and delivered to the Trustee the Indenture, dated as of March 8, 2002 (herein called the “Base Indenture”), providing for the issuance from time to time of one or more series of the Company’s
unsecured debentures, notes or other evidences of indebtedness (herein and in the Base Indenture called the “Securities”), the forms and terms of which are to be determined as set forth in Sections 201 and 301 of the Base Indenture;

  
 WHEREAS, the Company desires to create a series of Securities
in an aggregate principal amount of U.S. $750,000,000, which shall be designated the 2.75% Guaranteed Notes due December 29, 2006 (the “Notes”), and all action on the part of the Company necessary to authorize the issuance of the Notes
under the Base Indenture and this Third Supplemental Indenture has been duly taken; and 
  
 WHEREAS, all acts and things necessary to make this Third Supplemental Indenture a valid agreement of the Company, in accordance with its terms, have been done. 
  
 RECITALS OF THE GUARANTOR 
  
 WHEREAS, the Guarantor desires to make the Guarantees provided for herein and
in the Base Indenture; and 
  
 WHEREAS, all things necessary to
make this Third Supplemental Indenture a valid agreement of the Guarantor, in accordance with its terms, have been done. 
  
 NOW, THEREFORE, THIS THIRD SUPPLEMENTAL INDENTURE WITNESSETH: 
  
 For and in consideration of the premises and the purchase of the Notes by the Holders thereof, it is mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders of the Notes, as follows: 
  

 1 

 ARTICLE ONE 
  
 CREATION OF THE NOTES 
  
 Section 1.1. Designation of Series. Pursuant to the terms hereof and Sections 201 and 301 of the Base Indenture, the Company hereby creates a series of
Securities designated as the “2.75% Guaranteed Notes due December 29, 2006,” which Notes shall be deemed “Securities” for all purposes under the Base Indenture. 
  
 Section 1.2. Form of Notes. The form of the Notes shall be substantially as set forth in Exhibit A attached hereto,
which is incorporated herein and made part hereof. The Notes shall bear interest, be payable and have such other terms as are stated in said form of the Notes attached hereto as Exhibit A and in the Base Indenture, as supplemented by this
Third Supplemental Indenture. The Stated Maturity of the Notes shall be December 29, 2006. 
  
 Section 1.3. Limit on Amount of Series. The Notes shall not exceed U.S. $750,000,000 in aggregate principal amount Outstanding under the Base Indenture at any time, except as otherwise provided in the last paragraph
of Section 301 of the Base Indenture. The Notes may, upon the execution and delivery of this Third Supplemental Indenture or from time to time thereafter, be executed by the Company and delivered to the Trustee for authentication, and the Trustee
shall thereupon authenticate and deliver said Notes upon the delivery of a Company Order and such other documents as shall be required by the Base Indenture. 
  
 Section 1.4. Redemption. The Notes shall not be redeemable except as provided in Section 1108 of the Base Indenture. 
  
 Section 1.5. No Sinking Fund. No sinking fund will be provided with respect
to the Notes. 
  
 Section 1.6. Notes Not Convertible or
Exchangeable. The Notes will not be convertible or exchangeable for other securities or property. 
  
 Section 1.7. Issuance of Notes; Selection of Depositary. The Notes shall be issued as Global Securities in registered form, without coupons. The initial
Depositary for the Notes shall be The Depository Trust Company. 
  
 ARTICLE TWO 
  
 MISCELLANEOUS 
  
 Section 2.1. Execution as Supplemental Indenture. This Third Supplemental
Indenture is executed and shall be construed as an indenture supplemental to the Base Indenture and, as provided in the Base Indenture, this Third Supplemental Indenture forms a part thereof. Except as herein expressly otherwise defined, the use of
the terms and expressions herein is in accordance with the definitions, uses and constructions contained in the Base Indenture. 
  

 2 

 Section 2.2. Responsibility for Recitals, Etc. The recitals herein shall be taken as the statements of
the Company and the Guarantor, and the Trustee assumes no responsibility for the correctness thereof. The Trustee makes no representations as to the validity or sufficiency of this Third Supplemental Indenture. 
  
 Section 2.3. Provisions Binding on Company’s and Guarantor’s
Successors. All the covenants, stipulations, promises and agreements of the Company contained in this Third Supplemental Indenture shall bind the Company’s successors and assigns whether so expressed or not. All the covenants, stipulations,
promises and agreements of the Guarantor contained in this Third Supplemental Indenture shall bind the Guarantor’s successors and assigns whether so expressed or not. 
  
 Section 2.4. New York Contract. This Third Supplemental Indenture, each Note and the Guarantees shall be governed by and
construed in accordance with the laws of the state of New York, except that the authorization and execution of this Third Supplemental Indenture, each Note and the Guarantees shall be governed by the laws of the respective jurisdictions of
organization of the Company and the Guarantor. 
  
 Section 2.5.
Execution and Counterparts. This Third Supplemental Indenture may be executed with counterpart signature pages or in any number of counterparts, each of which shall be an original but such counterparts shall together constitute but one and the same
instrument. 
  
 Section 2.6. Capitalized Terms. Capitalized terms
not otherwise defined in this Third Supplemental Indenture shall have the respective meanings assigned to them in the Base Indenture. 
  

 3 

 IN WITNESS WHEREOF, the Company and the Trustee hereto have caused this Third Supplemental Indenture to
be duly executed, and the Guarantor has caused this Third Supplemental Indenture to be signed on its behalf by Gary Admans, its duly appointed attorney, all as of the day and year first above written. 
  

	 BP CAPITAL MARKETS p.l.c.

		
	By:	 	 
	 	

	 Name:
	 	 
	 Title:
	 	 

  
 Attest: 
  

	 
		
	By:	 	 
	 	

	 Name:
	 	 
	 Title:
	 	 

  

	 BP p.l.c.

		
	By:	 	 
	 	

	 Name:
	 	 
	 Title:
	 	 

  

	 JPMORGAN CHASE BANK, AS
TRUSTEE

		
	By:	 	 
	 	

	 Name:
	 	 
	 Title:
	 	 

  
 Attest: 
  

	 
		
	By:	 	 
	 	

	 Name:
	 	 
	 Title:
	 	 

  

 4 

 EXHIBIT A 
  
 FORM OF NOTE 
  
 [Face of Security] 
  
 This Security is a Global Security within the meaning of the Indenture hereinafter referred to and is registered in the name of a Depositary or a nominee of a Depositary. This Global Security is exchangeable for
Securities registered in the name of a Person other than the Depositary or its nominee only in the limited circumstances described in the Indenture, and no transfer of this Security (other than a transfer of this Security as a whole by the
Depositary to a nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of the Depositary) may be registered except in such limited circumstances. 
  
 Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation
(“DTC”), to the Company or its agent for registration of transfer, exchange, or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of DTC
(and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered
owner hereof, Cede & Co., has an interest herein. 
  
 BP
CAPITAL MARKETS P.L.C. 
  
 2.75% GUARANTEED NOTE DUE DECEMBER 29, 2006 
  

	No.         	 	$                        

  
 CUSIP 05565Q AK 4

  
 BP CAPITAL MARKETS
P.L.C., a corporation duly organized and existing under the laws of England and Wales (herein called the “Company”, which term includes any successor corporation under the Indenture hereinafter
referred to), for value received, hereby promises to pay to CEDE & CO., or registered assigns, the principal sum of
                 Dollars ($                  ) on December
29, 2006, and to pay interest thereon from November 10, 2003 or from the most recent Interest Payment Date to which interest has been paid or duly provided for, semi-annually on June 29 and December 29 in each year, commencing December 29, 2003, at
the rate of 2.75% per annum, until the principal hereof is paid or made available for payment. The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in such Indenture, be paid to the Person
in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such interest, which shall be the June 15 or December 15 (whether or not a Business Day), as the case may be,
next preceding such Interest Payment Date. Any such interest not so punctually paid or duly provided for will forthwith cease to be payable to the 

 Holder on such Regular Record Date and may either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of Securities of this series not less than 10
days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities of this series may be listed, and upon such notice as may be required
by such exchange, all as more fully provided in said Indenture. 
  
 A “Business Day” means any day that is not a Saturday or Sunday and that, in London, England and in the City of New York, New York, is not a day on which banking institutions generally are authorized or required by law, regulation
or executive order to close. 
  
 If any deduction or withholding
for any present or future taxes, assessments or other governmental charges of the jurisdiction (or any political subdivision or taxing authority thereof or therein) in which the Company is incorporated, shall at any time be required by such
jurisdiction (or any such political subdivision or taxing authority) in respect of any amounts to be paid by the Company of principal of or interest on a Security of this series, then the Company will pay to the Holder of a Security of this series
such additional amounts as may be necessary in order that the net amounts paid to such Holder of such Security who, with respect to any such tax, assessment or other governmental charge, is not resident in such jurisdiction, after such deduction or
withholding, shall be not less than the amounts specified in such Security to which such Holder is entitled; provided, however, that the Company shall not be required to make any payment of additional amounts (1) for or on account of any such
tax, assessment or governmental charge imposed by the United States or any political subdivision or taxing authority thereof or therein or (2) for or on account of: 
  
 (a) any tax, assessment or other governmental charge which would not have been imposed but for (i) the existence of any
present or former connection between such Holder (or between a fiduciary, settlor, beneficiary, member or shareholder of, or possessor of a power over, such Holder, if such Holder is an estate, trust, partnership or corporation) and the taxing
jurisdiction or any political subdivision or territory or possession thereof or area subject to its jurisdiction, including, without limitation, such Holder (or such fiduciary, settlor, beneficiary, member, shareholder or possessor) being or having
been a citizen or resident thereof or being or having been present or engaged in trade or business therein or having or having had a permanent establishment therein or (ii) the presentation of a Security of this series (where presentation is
required) for payment on a date more than 30 days after the date on which such payment became due and payable or the date on which payment thereof is duly provided for, whichever occurs later; 
  
 (b) any estate, inheritance, gift, sale, transfer, personal property or
similar tax, assessment or other governmental charge; 

 (c) any tax, assessment or other governmental charge which is payable otherwise than by withholding from
payments of (or in respect of) principal of, or any interest on, the Securities of this series; 
  
 (d) any tax, assessment or other governmental charge that is imposed or withheld by reason of the failure by the Holder or the beneficial owner of the
Security of this series (i) to provide information concerning the nationality, residence or identity of the Holder or such beneficial owner or (ii) to make any declaration or other similar claim or satisfy any information or reporting requirements,
which, in the case of (i) or (ii), is required or imposed by a statute, treaty, regulation or administrative practice of the taxing jurisdiction as a precondition to exemption from all or part of such tax, assessment or other governmental charge;

  
 (e) any tax, assessment or other governmental charge which
such Holder would have been able to avoid by presenting such Security to another Paying Agent; 
  
 (f) any tax, assessment or other governmental charge which is imposed on a payment pursuant to the European Union Directive approved on June 3, 2003, regarding taxation of, and information exchange among member states
of the European Union with respect to, interest income, or any law implementing such directive; or 
  
 (g) any combination of items (a), (b), (c), (d), (e) and (f) above; nor shall additional amounts be paid with respect to any payment of the principal of,
or any interest on, any Security of such series to any Holder who is a fiduciary or partnership or other than the sole beneficial owner of such payment to the extent such payment would be required by the laws of the jurisdiction (or any political
subdivision or taxing authority thereof or therein) to be included in the income for tax purposes of a beneficiary or settlor with respect to such fiduciary or a member of such partnership or a beneficial owner who would not have been entitled to
such additional amounts had it been the Holder of such Security. 
  
 The foregoing provisions shall apply mutatis mutandis to any withholding or deduction for or on account of any present or future taxes, assessments or governmental charges of whatever nature of any jurisdiction in which any successor Person
to the Company is organized, or any political subdivision or taxing authority thereof or therein. 
  
 Payment of the principal of and interest on this Security will be made at the office or agency of the Company maintained for that purpose in the Borough
of Manhattan in the City of New York, in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; provided, however, that at the option of the Company
payment of interest may be made by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register. 

 Reference is hereby made to the further provisions of this Security set forth on the reverse hereof,
which further provisions shall for all purposes have the same effect as if set forth at this place. 
  
 Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose. 
  
 IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed. 
  
 Dated: 
  

	 BP CAPITAL MARKETS P.L.C.
  

		
	By:	 	 
	 	

	 Authorized Signatory

  

	 
	
	 Attest:         
  

	

	 

  
 [Trustee’s
Certificate of Authentication] 
  
 This is one of the
Securities of the series designated herein referred to in the within-mentioned Indenture. 
  

	 JPMorgan Chase Bank, as Trustee
  

		
	By:	 	 
	 	

	 Authorized Officer

 [Reverse of Security] 
  
 This Security is one of a duly authorized issue of securities of the Company (herein called the “Securities”),
issued and to be issued in one or more series under an Indenture, dated as of March 8, 2002 (herein called the “Base Indenture”), among the Company, as Issuer, BP p.l.c., as Guarantor (herein called the “Guarantor”), and JPMorgan
Chase Bank, as Trustee (herein called the “Trustee”, which term includes any successor trustee under the Indenture), (such Base Indenture as supplemented by the Third Supplemental Indenture, dated November 10, 2003, the
“Indenture”) to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights, limitation of rights, duties and immunities thereunder of the Company, the Guarantor, the Trustee
and the Holders of the Securities and of the terms upon which the Securities are, and are to be, authenticated and delivered. This Security is one of the series designated on the face hereof, initially limited to $750,000,000 in aggregate principal
amount. 
  
 This Security is not redeemable prior to Stated
Maturity, except pursuant to Section 1108 of the Indenture. The date specified for the Securities of this series, for purposes of said Section 1108, is November 3, 2003. 
  
 If an Event of Default with respect to Securities of this series shall occur and be continuing, the principal of the
Securities of this series may be declared due and payable in the manner and with the effect provided in the Indenture. 
  
 The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the
Company and the Guarantor and the rights of the Holders of the Securities of each series to be affected under the Indenture at any time by the Company, the Guarantor and the Trustee with the consent of the Holders of a majority in principal amount
of the Securities at the time Outstanding of each series to be affected. The Indenture also contains provisions permitting the Holders of specified percentages in principal amount of the Securities of each series at the time Outstanding, on behalf
of the Holders of all Securities of such series, to waive compliance by the Company or the Guarantor, or both, with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences. Any such consent or waiver
by the Holder of this Security shall be conclusive and binding upon such Holder and upon all future Holders of this Security and of any Security issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security. 
  
 As provided in and subject to the provisions of the Indenture, the Holder of this Security shall not have the right to institute any proceeding with respect to the Indenture or for the appointment of a receiver or trustee or for any other
remedy thereunder, unless such Holder shall have previously given the Trustee written notice of a continuing Event of Default with respect to the Securities of this series, the Holders of not less than 25% in principal amount of the Securities of
this series at the time 

 Outstanding shall have made written request to the Trustee to institute proceedings in respect of such Event of Default
as Trustee and offered the Trustee reasonable indemnity, and the Trustee shall not have received from the Holders of a majority in principal amount of Securities of this series at the time Outstanding a direction inconsistent with such request, and
shall have failed to institute any such proceeding, for 60 days after receipt of such notice, request and offer of indemnity. The foregoing shall not apply to any suit instituted by the Holder of this Security for the enforcement of any payment of
principal hereof or interest hereon on or after the respective due dates expressed or provided for herein. 
  
 No reference herein to the Indenture and no provision of this Security or of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and interest on this Security at the times, place and rate, and in the coin or currency, herein prescribed. 
  

As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the office or agency of the Company in any place where the principal of and interest on this Security are payable, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Security Registrar duly executed by, the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Securities of this series, of authorized denominations and for the
same aggregate principal amount, will be issued to the designated transferee or transferees. 
  
 The Securities of this series are issuable only in registered form without coupons in denominations of $1,000 and any integral multiple thereof. As provided in the Indenture and subject to certain limitations therein
set forth, Securities of this series are exchangeable for a like aggregate principal amount of Securities of this series of a different authorized denomination, as requested by the Holder surrendering the same. 
  
 No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith. 
  
 Prior to due presentment of this Security for registration of transfer, the Company, the Guarantor, the Trustee and any agent of the Company, the
Guarantor or the Trustee may treat the Person in whose name this Security is registered as the owner hereof for all purposes (subject to Section 307 of the Indenture), whether or not this Security be overdue, and neither the Company, the Guarantor,
the Trustee nor any such agent shall be affected by notice to the contrary. 
  
 The Indenture provides that the Company and the Guarantor, at the Guarantor’s option, (a) will be discharged from any and all obligations in respect of the Securities (except for certain obligations to register
the transfer or exchange of Securities, replace stolen, lost or mutilated Securities, maintain paying agencies and hold moneys for 

 payment in trust) or (b) need not comply with certain restrictive covenants of the Indenture, in each case if the Company
or the Guarantor deposits, in trust, with the Trustee money or Government Obligations which through the payment of interest thereon and principal thereof in accordance with their terms will provide money, in an amount sufficient to pay all the
principal of and interest on the Securities on the dates such payments are due in accordance with the terms of such Securities and Guarantees, and certain other conditions are satisfied. 
  
 Except in the limited circumstances described in Section 305 of the Indenture, the Securities of this series shall be issued
in the form of one or more Global Securities and The Depository Trust Company shall be the Depositary for such Global Security or Securities. All terms used in this Security which are defined in the Indenture shall have the meanings assigned to them
in the Indenture. 

 GUARANTEE OF BP p.l.c. 
  
 For value received, BP p.l.c., a corporation duly organized and existing
under the laws of England and Wales (herein called the “Guarantor”, which term includes any successor corporation under the Indenture referred to in the Security upon which this Guarantee is endorsed), hereby unconditionally guarantees to
the Holder of the Security upon which this Guarantee is endorsed and to the Trustee referred to in such Indenture due and prompt payment of the principal of and interest on such Security when and as the same shall become due and payable, whether at
the Stated Maturity, by declaration of acceleration, call for redemption or otherwise, according to the terms thereof and of the Indenture referred to therein. In case of the failure of BP CAPITAL MARKETS P.L.C., a corporation duly organized and
existing under the laws of England and Wales (herein called the “Company”, which term includes any successor corporation under such Indenture) punctually to make any such principal or interest payment, the Guarantor hereby agrees to cause
any such payment to be made promptly when and as the same shall become due and payable, whether at the Stated Maturity, by declaration of acceleration, call for redemption or otherwise, and as if such payment were made by the Company. 
  
 The Guarantor hereby further agrees, subject to the limitations and
exceptions set forth below, that if any deduction or withholding for any present or future taxes, assessments or other governmental charges of the jurisdiction (or any political subdivision or taxing authority thereof or therein) in which the
Guarantor is incorporated, shall at any time be required by such jurisdiction (or any such political subdivision or taxing authority) in respect of any amounts to be paid by the Guarantor under this Guarantee, the Guarantor will pay to the Holder of
such Security such additional amounts as may be necessary in order that the net amounts paid to such Holder of such Security who, with respect to any such tax, assessment or other governmental charge, is not resident in such jurisdiction, after such
deduction or withholding, shall be not less than the amounts specified in such Security to which such Holder is entitled; provided, however, that the Guarantor shall not be required to make any payment of additional amounts (1) for or on
account of any such tax, assessment or governmental charge imposed by the United States or any political subdivision or taxing authority thereof or therein or (2) for or on account of: 
  
 (a) any tax, assessment or other governmental charge which would not have been imposed but for (i) the existence of any
present or former connection between such Holder (or between a fiduciary, settlor, beneficiary, member or shareholder of, or possessor of a power over, such Holder, if such Holder is an estate, trust, partnership or corporation) and the taxing
jurisdiction or any political subdivision or territory or possession thereof or area subject to its jurisdiction, including, without limitation, such Holder (or such fiduciary, settlor, beneficiary, member, shareholder or possessor) being or having
been a citizen or resident thereof or being or having been present or engaged in trade or business therein or having or having had a permanent establishment therein or (ii) the presentation of such Security (where presentation is required) for
payment on a 

 date more than 30 days after the date on which such payment became due and payable or the date on which payment thereof
is duly provided for, whichever occurs later; 
  
 (b) any estate,
inheritance, gift, sale, transfer, personal property or similar tax, assessment or other governmental charge; 
  
 (c) any tax, assessment or other governmental charge which is payable otherwise than by withholding from payments of (or in respect of) principal of, or
any interest on, such Security; 
  
 (d) any tax, assessment or
other governmental charge that is imposed or withheld by reason of the failure by the Holder or the beneficial owner of such Security (i) to provide information concerning the nationality, residence or identity of the Holder or such beneficial owner
or (ii) to make any declaration or other similar claim or satisfy any information or reporting requirements, which, in the case of (i) or (ii), is required or imposed by a statute, treaty, regulation or administrative practice of the taxing
jurisdiction as a precondition to exemption from all or part of such tax, assessment or other governmental charge; 
  
 (e) any tax, assessment or other governmental charge which such Holder would have been able to avoid by presenting such Security to another Paying Agent;

  
 (f) any tax, assessment or other governmental charge which is
imposed on a payment pursuant to the European Union Directive approved on June 3, 2003, regarding taxation of, and information exchange among member states of the European Union with respect to, interest income, or any law implementing such
directive; or 
  
 (g) any combination of items (a), (b), (c), (d),
(e) and (f) above; nor shall additional amounts be paid with respect to any payment of the principal of, or any interest on, such Security to any Holder who is a fiduciary or partnership or other than the sole beneficial owner of such payment to the
extent such payment would be required by the laws of the jurisdiction (or any political subdivision or taxing authority thereof or therein) to be included in the income for tax purposes of a beneficiary or settlor with respect to such fiduciary or a
member of such partnership or a beneficial owner who would not have been entitled to such additional amounts had it been the Holder of such Security. 
  
 The foregoing provisions shall apply mutatis mutandis to any withholding or deduction for or on account of any present or future taxes, assessments or
governmental charges of whatever nature of any jurisdiction in which any successor Person to the Guarantor is organized, or any political subdivision or taxing authority thereof or therein. 
  
 The Guarantor hereby agrees that its obligations hereunder shall be as if it
were principal debtor and not merely surety, and shall be absolute and unconditional, irrespective of, and shall be unaffected by, any invalidity, irregularity or unenforceability of such Security or such Indenture, any failure to enforce the
provisions of such Security 

 or such Indenture, or any waiver, modification or indulgence granted to the Company with respect thereto, by the Holder
of such Security or such Trustee, or any other circumstance which may otherwise constitute a legal or equitable discharge of a surety or guarantor; provided, however, that, notwithstanding the foregoing, no such waiver, modification or
indulgence shall, without the consent of the Guarantor, increase the principal amount of such Security or the interest rate thereon or impose or increase any premium payable upon redemption thereof. The Guarantor hereby waives diligence,
presentment, demand of payment, filing of claims with a court in the event of merger or bankruptcy of the Company, any right to require a proceeding first against the Company, protest or notice with respect to such Security or the indebtedness
evidenced thereby and all demands whatsoever, and covenants that this Guarantee will not be discharged except by payment in full of the principal of and interest on such Security. This is a guarantee of payment and not of collection. 
  
 The Guarantor shall be subrogated to all rights of the Holder of such
Security against the Company in respect of any amounts paid to such Holder by the Guarantor pursuant to the provisions of this Guarantee; provided, however, that the Guarantor shall not be entitled to enforce, or to receive any
payments arising out of or based upon, such right of subrogation until the principal of and interest on all Securities of the same series issued under such Indenture shall have been paid in full. 
  
 No reference herein to such Indenture and no provision of this Guarantee or
of such Indenture shall alter or impair the guarantee of the Guarantor, which is absolute and unconditional, of the due and punctual payment of the principal of and interest on the Security upon which this Guarantee is endorsed at the times, place
and rate, and in the coin or currency prescribed therein. 
  
 This
Guarantee shall not be valid or obligatory for any purpose until the certificate of authentication of such Security shall have been manually executed by or on behalf of the Trustee under such Indenture. 
  
 All terms used in this Guarantee which are defined in such Indenture shall
have the meanings assigned to them in such Indenture. 

 IN WITNESS WHEREOF, the Guarantor has caused this Guarantee
to be signed manually or in facsimile by a person duly authorized in that behalf. 
  

	 BP P.L.C.
  

	
	

	 AUTHORIZED SIGNATORY

  

	 
	
	     Attest:         
  

	

	 

  
 Dated
the date on the face hereof.

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