Document:

<PAGE>

Confidential treatment has been requested for portions of this contract. The
copy filed herewith omits the information subject to the confidentiality
request. Omissions are designated as [***]. A complete version of this contract
has been filed seprately with the Securities and Exchange Commission.

                                                                   EXHIBIT 10.54

                               JULY 2003 AMENDMENT

                                     TO THE

                SATELLITE PURCHASE CONTRACT FOR IN-ORBIT DELIVERY

                                     BETWEEN

                            XM SATELLITE RADIO INC.,

                        XM SATELLITE RADIO HOLDINGS INC.

                                       and

                            BOEING SATELLITE SYSTEMS
                               INTERNATIONAL, INC.

                              CONTRACT NUMBER L0634

<PAGE>

***** Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                               JULY 2003 AMENDMENT
                                     TO THE
                SATELLITE PURCHASE CONTRACT FOR IN-ORBIT DELIVERY

This July 2003 Amendment to the Satellite Purchase Contract for In-Orbit
Delivery effective March 23, 1998 as amended, assigned, restated, superseded
and/or supplemented from time to time and in effect through and including the
date hereof (the "Contract") is made as of July 31, 2003 by and between XM
Satellite Radio Inc. and XM Satellite Radio Holdings Inc., Delaware corporations
with their principal offices located at 1500 Eckington Place, N.E. Washington DC
20002 (hereinafter referred to together, or individually as may be appropriate,
as "Customer" or "XM") and Boeing Satellite Systems International, Inc., a
Delaware corporation with its principal offices located at 2260 E. Imperial
Highway, El Segundo, California 90245 (hereinafter "Contractor" or "BSSI").
Capitalized terms used but not otherwise defined in this July 2003 Amendment
shall have the respective meanings as set forth in the Contract.

WHEREAS, the Parties entered into and executed the Contract, which Contract
provides for the procurement by Customer (or its subsidiaries) from Contractor
of three (3) Boeing 702 Satellites, two (2) of which (XM-1 and XM-2) have been
delivered in-orbit and one (1) of which (XM-3) was originally being constructed
as a ground spare and is now scheduled to be delivered in-orbit (referred to
herein as "XM-3" or the "Ground Spare Satellite)", together with related items,
services and activities;

WHEREAS, in December 2001, the Contract, as it relates to the Ground Spare
Satellite Bus, was assigned by XM Satellite Radio Inc. to XM Satellite Radio
Holdings;

WHEREAS, in December 2001, Customer and Contractor entered into certain
arrangements (the "December Amendment") relating to the completion and launch of
the Ground Spare Satellite;

WHEREAS, in May 2003, Customer and Contractor amended certain provisions of the
Contract to provide for basic additional terms concerning the aforementioned
completion and launch of the Ground Spare Satellite [***] (the "Amended and
Restated May 2003 Amendment");

WHEREAS, Customer and Contractor desire to amend certain provisions of the
Contract to include procurement by Customer from Contractor of a fourth
Satellite (the "XM-4 Satellite") to be delivered at Contractor's facility and
accepted in-orbit and an option for a fifth Satellite (the "XM-5 Satellite"),
together with related items, services and activities;

NOW, THEREFORE, in consideration of the mutual benefits to be derived, the
Parties hereto agree that the Contract is amended as follows:

XM SATELLITE RADIO INC., XM SATELLITE RADIO HOLDINGS INC.              JULY 2003
and BOEING SATELLITE SYSTEMS                                           Amendment
INTERNATIONAL, INC. CONFIDENTIAL & PROPRIETARY   1                Contract L0634

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requested with respect to the omitted portions.

1.   Amendment of Article 1.1 (Definitions). Article 1.1 is hereby amended as
     follows:

     (a) The term "Incentive Amount" defined in paragraph (xx) does not include
     the High Performance Incentives or the Extended Life Incentives eligible to
     be earned by Contractor in accordance with Article 12.10 and 12.11,
     respectively.

     (b) In paragraph (m) "Conduct Spacecraft Critical Design Review (SCDR)" the
     phrase ", October 15, 2004 (with respect to the third Satellite) and
     October 31, 2005 (with respect to the fourth Satellite)" is added to the
     end of the last sentence. The SCDRs for the third and fourth Satellite
     shall address only those areas affected by changes from the first and
     second Satellites to the third and fourth Satellites.

     (c) With regard to the XM-4 Satellite, the "Launch Agency" shall be the
     entity selected by Customer. The term "Launch Agreement" set forth in
     paragraph (hhh) means, with respect to the XM-3 Satellite, any Subcontract
     between Contractor and a Launch Agency to perform Launch Services for the
     XM-3 Satellite, and with respect to the XM-4 Satellite, the agreement
     between Customer and a Launch Agency to perform Launch Services for the
     XM-4 Satellite.

     (d) In paragraph (lll) "Launch and In-Orbit Insurance" or "Launch
     Insurance", the phrase "of XM-1 and XM-2, respectively, or at least one (1)
     year after the date of Launch of XM-3" shall be revised to read "of XM-1
     and XM-2, respectively, or at least one (1) year after the date of Launch
     of XM-3 or XM-4, respectively".

     (e) In paragraph (cccc) "Milestone", the phrase ", Exhibit G-2 (FM2 (XM-3)
     Payment Plan, [***], Termination Liability Schedule and Payment Plan for
     Incentive Amounts and Payment Plan for Sea Launch Launch Vehicle) and
     Exhibit G-3 (XM-4 Payment Plan, Termination Liability Schedule and Payment
     Plans for Incentive Amounts, High Performance Incentives and Extended Life
     Incentives)" is added to the end thereof.

     (f) In paragraph (dddd) "Milestone Payment", the phrase ", Exhibit G-2 (FM2
     (XM-3) Payment Plan, [***], Termination Liability Schedule and Payment Plan
     for Incentive Amounts and Payment Plan for Sea Launch Launch Vehicle) and
     Exhibit G-3 (XM-4 Payment Plan, Termination Liability Schedule and Payment
     Plans for Incentive Amounts, High Performance Incentives and Extended Life
     Incentives)" is added to the end thereof. For clarification, the term
     "Exhibit G (Payment Plan and Termination Liability Amounts)" as used in the
     Contract means Exhibit G (Payment Plan and Termination Liability Amounts)
     and Exhibit G-1 (PFM (XM1) and FM1

XM SATELLITE RADIO INC., XM SATELLITE RADIO HOLDINGS INC.              JULY 2003
and BOEING SATELLITE SYSTEMS                                           Amendment
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     (XM2) Payment Plans for In-orbit Incentive Amounts) with respect to XM-1
     and XM-2, Exhibit G-2 (FM2 (XM-3) Payment Plan, [***], Termination
     Liability Schedule and Payment Plan for Incentive Amounts and Payment Plan
     for Sea Launch Launch Vehicle) with respect to XM-3, and Exhibit G-3 (XM-4
     Payment Plan, Termination Liability Schedule and Payment Plans for
     Incentive Amounts, High Performance Incentives and Extended Life
     Incentives) with respect to XM-4.

     (g) In paragraph (nnn) "Launch Period", the phrase ", and the three-month
     period from December 1, 2005 through February 28, 2006, with respect to the
     fourth Satellite" shall be added after the phrase "with respect to the
     third Satellite".

     (h) In paragraph (oooo), the following sentence is added to the end
     thereof:

          "(oooo) 'Quarterly Incentive Payment Amount' means, with respect to
          XM-4, an amount equal to Two Hundred Fifty Thousand Dollars ($250,000)
          (that is, Twelve Million Dollars ($12,000,000) divided by forty-eight
          (48) representing 12 years x 4 quarters per year), as may be adjusted
          in accordance with the terms of this Contract."

     (i) Paragraph (ssss) "Satellite" is deleted in its entirety and replaced
     with the following:

         "(ssss) 'Satellite' means each of the four (4) Boeing 702 satellites to
         be Delivered by Contractor to Customer pursuant to this Contract that
         conforms to all the requirements of this Contract, except where there
         is a specific reference or term related to a specific satellite (XM-1 -
         Roll, XM-2 - Rock, XM-3 or XM-4), such reference shall refer to that
         satellite and such specific reference or term shall apply only to such
         satellite. The XM-4 Satellite shall also be referred to herein as the
         `fourth Satellite'."

     (j) Paragraph (bbbbb) "Spacecraft Performance Specification" is deleted in
     its entirety and replaced with the following:

          "(bbbbb) 'Spacecraft Performance Specification' and `Exhibit A
          (Spacecraft Performance Specifications)' mean the technical
          specifications set forth in Exhibit A (Spacecraft Performance
          Specifications) with respect to the XM-1, XM-2 and XM-3 Satellites and
          Exhibit A-2 (XM-4 Spacecraft Performance Specifications) with respect
          to the XM-4 Satellite, as may be amended pursuant to this Contract."

XM SATELLITE RADIO INC., XM SATELLITE RADIO HOLDINGS INC.              JULY 2003
and BOEING SATELLITE SYSTEMS                                           Amendment
INTERNATIONAL, INC. CONFIDENTIAL & PROPRIETARY   3                Contract L0634

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     (k) Paragraph (ddddd) "Statement of Work" is deleted in its entirety and
     replaced with the following:

          "(ddddd) 'Statement of Work' and 'Exhibit B (Statement of Work)' mean
          the Work described in Exhibit B (Statement of Work) (with respect to
          the XM-1, XM-2 and XM-3 Satellites) and Exhibit B-2 (XM-4 Statement of
          Work) (with respect to the XM-4 Satellite) to this Contract and to be
          provided by Contractor, as may be amended pursuant to this Contract."

     (l) In paragraph (ggggg) "Termination Liability Amounts", the phrase "and
     in Exhibit G-3 (XM-4 Payment Plan, Termination Liability Amounts and
     Payment Plans for Incentive Amounts, High Performance Incentives and
     Extended Life Incentives)" is added after the phrase "Exhibit G-2 (Ground
     Spare Satellite Payment Plan, Termination Liability Amounts and Incentive
     Amounts)".

     (m) In paragraph (jjjjj) the "Total Amount at Risk" is adjusted to reflect
     the addition of Twelve Million Dollars ($12,000,000) eligible to be earned
     by Contractor as performance incentive payments for the XM-4 Satellite in
     accordance with Article 12.3. The "Total Amount at Risk" does not include
     the High Performance Incentives or the Extended Life Incentives.

     (n) The following new definitions are added to Article 1.1:

          "The defined term 'Customer' when used with respect to the XM-4
          Satellite means XM Satellite Radio Holdings Inc."

          "'XM-4 Deferred Amount' means the aggregate milestone payments
          deferred by Contractor pursuant to Article 5.9."

          "'XM-4 EDC' means the Effective Date of the July 2003 Amendment."

          "'XM-4 Extended Life Incentives' means any amount required to be paid
          pursuant to Article 12.11 (Extended Life Incentives)."

          "'XM-4 High Performance Incentives' means any amount required to be
          paid pursuant to Article 12.10 (High Performance Incentives)."

XM SATELLITE RADIO INC., XM SATELLITE RADIO HOLDINGS INC.              JULY 2003
and BOEING SATELLITE SYSTEMS                                           Amendment
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requested with respect to the omitted portions.

          "System Requirements Review" shall mean the flowdown of applicable
          requirements from higher hierarchical levels, to ensure they are
          complete and properly identified and there is a mutual understanding
          between the Customer, Contractor and Subcontractor(s) on product
          requirements; such review shall be completed in accordance with
          Exhibit B-2 (XM-4 Statement of Work) no later than [***] with respect
          to the fourth Satellite."

2. Amendment to Article 1.3 (Integration and Construction).

          Paragraphs (a) through (l) in Article 1.3 (Integration and
     Construction) are deleted in their entirety and replaced with the
     following:

               "(a) Terms and Conditions

               (b)  Exhibit G - Payment Plan and Termination Liability Amounts

               (c)  Exhibit G-1 - PFM (XM1) and FM1 (XM2) Payment Plans for
                    In-Orbit Incentive Amounts

               (d)  Exhibit G-2 - FM2 (XM3) Payment Plan, [***], Termination
                    Liability Schedule, Payment Plan for In-Orbit Performance
                    Incentive Amounts and Payment Plan for Sea Launch Launch
                    Vehicle

               (e)  Exhibit G-3 - XM4 Payment Plan, Termination Liability
                    Schedule and Payment Plans for Incentive Amounts, High
                    Performance Incentives and Extended Life Incentives

               (f)  Exhibit B - Statement of Work

               (g)  Exhibit B-2 - XM-4 Statement of Work

               (h)  Exhibit A - Spacecraft Performance Specifications

               (i)  Exhibit A-2 - XM-4 Spacecraft Performance Specifications

               (j)  Exhibit D - Test Plan Requirements

               (k)  Exhibit C - Product Assurance Plan

               (l)  Exhibit E - Radiation Environment

XM SATELLITE RADIO INC., XM SATELLITE RADIO HOLDINGS INC.              JULY 2003
and BOEING SATELLITE SYSTEMS                                           Amendment
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               (m)  Exhibit F - Long-Lead Activities and Items

               (n)  Exhibit H - Initial Satellite Operations Phase and Criteria
                    for Final Handover Statement of Work

               (o)  Exhibit I - Form of Warrant"

3. Amendment to Article 2 (Scope of Work):

     (a)  The following new paragraphs are added to Article 2.1(b) at the end
          thereof:

                 "(13) Exhibit A-2   -XM-4 Spacecraft Performance Specifications
                 (14) Exhibit B-2    -XM-4 Statement of Work
                 (15) Exhibit I      -Form of Warrant"

     (b)  Article 2.1(c) is deleted in its entirety and replaced with the
          following:

                 "(c) Exhibits A, A-2, B, B-2, C, D, E, F, G, G-1, G-2, G-3, H
                 and I are attached to and incorporated into these Terms and
                 Conditions."

     (c)  The following new Article 2.4 is added to Article 2:

          "2.4 Certain Modifications to and Capabilities of XM-4.

          [***]

               (3) Contractor will confirm in writing prior to Launch (at the
          Shipment Readiness Review) that the Satellite fully conforms to the
          Contract and there are no Defects in XM-4 (taking into account (and
          providing a summary of) waivers mutually agreed for XM-4 by the
          Parties in writing) and that any known defects, failures or anomalies
          in any Contractor manufactured satellite (either in-orbit or on
          ground) that may be applicable to XM-4 have been identified by
          Contractor to Customer and corrected on XM-4, except where Contractor
          demonstrates such defect, failure or anomaly is not applicable to
          XM-4. In the event the Satellite does not fully conform to the
          Contract, Contractor shall provide a summary of all deviations that
          exist and the corrective actions Contractor intends to employ.
          Contractor shall provide to Customer (in writing) an updated
          certification to the above at each of the Flight Readiness Review,
          Launch Readiness Review and

XM SATELLITE RADIO INC., XM SATELLITE RADIO HOLDINGS INC.              JULY 2003
and BOEING SATELLITE SYSTEMS                                           Amendment
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          Consent to Fuel Review. In addition, Contractor shall provide any
          other certifications, confirmations or other information with respect
          to the Satellite as reasonably required by Customer's Launch and
          In-Orbit Insurance insurers and underwriters and shall take any other
          action reasonably requested by Customer or any such insurers or
          underwriters that is necessary or advisable in order for Customer to
          obtain Launch and In-Orbit Insurance on reasonable and customary
          terms."

     (d) The following new Article 2.5 is added to Article 2:

     "2.5 XM 3/4/5 [***]"

          [***].

     (e) The following new Article 2.6 is added to Article 2:

          "2.6 [***]

          [***].

4. Amendment of Article 4.1 (Contract Price). The pricing for XM-4 shall be as
follows:

     (a) A new Item 6 is added to Table 4.1 as set forth below. Accordingly, the
     Contract Price set forth in Article 4.1 is revised to be $[***].

     --------------------------------------------------------------------
         "6   XM-4 Satellite, including Incentive Amounts   $   [***]
     --------------------------------------------------------------------

     Note: For clarification purposes, the portion of the Contract Price stated
     in Item 6 does not include [***].

     (b) Article 4.1(c)(4), 4.1(c)(5) and 4.1(c)(6) shall be amended to include
     the fourth Satellite (XM-4) and are deleted in their entirety and replaced
     with the following:

          "(4) Launch Campaigns for the first, second, third and fourth
               Satellites;

          (5)  LEOP for the first, second, third and fourth Satellites;

          (6)  Mission Support Services for the first, second, third and fourth
               Satellites;"

XM SATELLITE RADIO INC., XM SATELLITE RADIO HOLDINGS INC.              JULY 2003
and BOEING SATELLITE SYSTEMS                                           Amendment
INTERNATIONAL, INC. CONFIDENTIAL & PROPRIETARY   7                Contract L0634

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     Note: for clarification purposes, items 1, 2, 3, 7, 8 and 9 set forth in
     Article 4.1(c) also apply to the fourth Satellite.

5.   Amendment of Article 5 (Payment). Article 5 is hereby amended as follows:

     (a)  In Article 5.1(a), the phrase "and Exhibit G-3 (XM-4 Payment Plan,
          Termination Liability Schedule and Payment Plans for Incentive
          Amounts, High Performance Incentives and Extended Life Incentives)" is
          added to the end of the sentence.

     (b)  Amendment of Article 5.2. In Article 5.2(a)(1), the phrase "and
          Exhibit G-3 (XM-4 Payment Plan, Termination Liability Schedule and
          Payment Plans for Incentive Amounts, High Performance Incentives and
          Extended Life Incentives)" is added after the phrase "Exhibit G-2
          (Ground Spare Satellite Payment Plan, Termination Liability Schedule
          and Incentive Amounts)" in the first sentence.

     (c)  Amendment of Article 5.7 (Security Interest).

               (1) The following sentence is added to the end of Article 5.7(b):

          "With regard to XM-4, upon Contractor's reasonable request, Customer
          shall sign and permit Contractor to file, for precautionary purposes,
          appropriate Uniform Commercial Code financing statements or any
          similar document having the same effect in foreign countries,
          reflecting Contractor's right, title and interest to the XM-4
          Satellite prior to receipt of the XM-4 Deferred Amount, provided that
          Contractor, at its sole expense, shall be responsible for preparing
          such financing statements and terminating such financing statements as
          required by this Article 5.7 (Security Interest)."

               (2) The following new subparagraph (6) is added to Article
               5.7(c):

          "(6) Subject to Article 5.6 (Payments Current at Launch), with respect
          to XM-4 and all other Deliverable Items related thereto, Contractor's
          security interest therein shall be released and terminated upon
          payment of the XM-4 Deferred Amount and any applicable interest
          thereon."

               (3) In Article 5.7(e), the following new subparagraph (iv) is
               added to the end of the first sentence:

         "(iv) with respect to XM-4 Satellite, only prior to payment of the XM-4
         Deferred Amount and any applicable interest thereon."

     (d)  Addition of New Article 5.9. The following new Article 5.9 is added to
          Article 5:

XM SATELLITE RADIO INC., XM SATELLITE RADIO HOLDINGS INC.              JULY 2003
and BOEING SATELLITE SYSTEMS                                           Amendment
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          "5.9 Payment and Deferred Financing for XM-4.

               (a)  The price for the XM-4 Satellite will be paid in accordance
                    with the payment plan attached hereto as Exhibit G-3 (XM-4
                    Payment Plan, Termination Liability Schedule and Payment
                    Plans for Incentive Amounts, High Performance Incentives and
                    Extended Life Incentives).

               (b)  [***].

     (e)  Addition of New Article 5.10. The following new Article 5.10 is added
          to Article 5:

          "5.10 Grant of Warrant.

          In further consideration of Contractor's agreeing to defer certain
          payments in accordance with Article 5.9 above, Customer shall provide
          to Contractor a Warrant to purchase 500,000 shares of Customer's stock
          at a strike price equal to the average closing price (on NASDAQ) of
          Customer's Class A Common Stock, $0.01 par value (the "XM Stock"), for
          the five (5) Business Days prior to XM-4 EDC. The Warrant will fully
          vest in and be exercisable by Contractor on January 31, 2005, provided
          Contractor (i) has fulfilled its payment deferral obligations as set
          forth in Article 5.9 above and (ii) is in compliance with all material
          obligations applicable to Contractor hereunder through January 31,
          2005. The Warrant will have a five-year life from the XM-4 EDC. The
          Warrant will be issued to Contractor in the form of Exhibit I (Form of
          Warrant) attached hereto."

6.   Amendment of Table 7.1; Delivery Date of XM-4. Contractor shall deliver
     XM-4, and delivery of XM-4 shall occur, on the Available for Shipment date
     which shall be no later than October 31, 2005 (i.e., 27 months after XM-4
     EDC) and Initial Handover shall be no later than [***]. Accordingly, a new
     row 8 is added to Table 7.1 and the existing rows 8, 9, 10, 11, 12, 13 (and
     any cross-references in the Contract thereto) shall be renumbered 9, 10,
     11, 12, 13, 14, respectively:

<TABLE>
<S>     <C>                               <C>                           <C>
        8A   4th Satellite Available      No later than October 31,     FOB Contractor's Facilities
             for Shipment                 2005 (i.e., 27 months after
                                          XM-4 EDC)

        8B   Transportation to Launch     As Required for Initial       As specified in Exhibit B
             Site, Launch Campaign, and   Handover to occur no later    (SOW)
             LEOP (4th Satellite to       than [***]
             Initial
</TABLE>

XM SATELLITE RADIO INC., XM SATELLITE RADIO HOLDINGS INC.              JULY 2003
and BOEING SATELLITE SYSTEMS                                           Amendment
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<TABLE>
<S>     <C>                               <C>                           <C>
             Handover)

        8C   Pre-Eclipse Test Report      [***] following completion    Customer's Facilities
             with respect to XM-4         of In-Orbit Testing

        8D   Post-Eclipse Test Report     [***] following the end of    Customer's Facilities
             with respect to XM-4         the first full eclipse
                                          period after Launch
</TABLE>

7.   Amendment of Article 10.1.

     (a) The following new paragraph Article 10.1(d) shall be added after
     Article 10.1(c) and the existing paragraphs (d), (e) and (f) (and any
     cross-references in the Contract thereto) shall be renumbered (e), (f),
     (g), respectively:

          "(d) In the event Contractor fails to Deliver the fourth Satellite on
          or before the [***] Calendar Day following its respective Delivery
          Date (i.e., October 31, 2005), as such date may be adjusted in
          accordance with this Contract (the "XM-4 Grace Period Expiration
          Date"), Contractor agrees to pay Customer with respect to such
          Satellite, as liquidated damages and not as a penalty, the following
          amounts for the period beginning on the first (1st) day following the
          XM-4 Grace Period Expiration Date and continuing for a period
          thereafter not to exceed [***] (the "XM-4 Damages Period"):

               (1) [***] for each Calendar Day during the period commencing on
          the first (1st) Calendar Day of the XM-4 Damages Period for such
          Satellite and continuing through [***] of the XM-4 Damages Period; and

               (2) [***] for each Calendar Day during the period commencing on
          the [***] Calendar Day of the XM-4 Damages Period for such Satellite
          and continuing through the [***] of the XM-4 Damages Period.

          The total amount of liquidated damages for failure to meet the
          Delivery Date for XM-4 shall not exceed Nine Million One Hundred
          Thousand Dollars ($9,100,000)."

     (b) In the existing Article 10.1(d) (renumbered as Article 10.1(e)), the
     phrase "(except the Ground Spare Satellite)" in the first sentence is
     deleted and replaced with the phrase "(except the Ground Spare Satellite
     and the XM-4 Satellite)".

     (c) The existing Article 10.1(e) (renumbered as Article 10.1(f)) shall also
     apply to the new Article 10.1(d) set forth above.

XM SATELLITE RADIO INC., XM SATELLITE RADIO HOLDINGS INC.              JULY 2003
and BOEING SATELLITE SYSTEMS                                           Amendment
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     (d) In the existing Article 10.1(f) (renumbered as Article 10.1(g)), the
     phrase "With regard to liquidated damages for late delivery of a Satellite
     pursuant to this Article 10.1 (Liquidated Damages)" shall be replaced with
     the phrase "With regard to liquidated damages for late delivery of XM-1,
     XM-2 and/or XM-3 pursuant to this Article 10.1 (Liquidated Damages)".
     Further, the following sentence shall be added at the end of 10.1(g):

     "With respect to XM-4, any Launch Agency delay, regardless of duration,
     shall be deemed a Contractor Excusable Delay."

8.   Amendment of Article 12 (In-Orbit Performance Incentive Payments).

     (a) Contractor is eligible to earn Twelve Million Dollars ($12,000,000) as
     performance incentive payments for the XM-4 Satellite in accordance with
     Article 12.3 for each day XM-4 is a Satisfactorily Operating Satellite
     [***], provided, however, (1) such incentives shall be earned and paid over
     the first twelve (12) years of the XM-4 Orbital Design Life and (2)
     Contractor shall not be entitled to any Quarterly Incentive Amount eligible
     to be earned by Contractor pursuant to Article 12.3(b)(4) in the event the
     cumulative Incentive Amounts earned by Contractor with respect to the XM-4
     Satellite exceed Twelve Million Dollars ($12,000,000).

     (b) The following new paragraph (c)(2) is added to Article 12.3:

          "(2) In the event XM-4 is a Constructive Total Loss or Total Loss
          prior to successful injection of the Satellite into its specified
          orbit by the Launch Vehicle for reasons not attributable to
          Contractor, Contractor shall be entitled to be paid the $12M
          Performance Incentives from insurance proceeds (neither the High
          Performance Incentives nor Extended Life Incentives will be paid in
          such a case)."

     (c) The following new Article 12.10 (High Performance Incentives) is added
     to Article 12:

     "12.10 High Performance Incentives for XM-4.

          In the event XM-4 is a Satisfactorily Operating Satellite and XM-4
     performance meets or exceeds [***], Contractor shall have the right to
     earn, in addition to the Incentive Amounts applicable to XM-4, a total of
     Seven Million Five Hundred Thousand Dollars ($7,500,000) in High
     Performance Incentives. Such incentives shall be earned at the daily rate
     of One Thousand Three Hundred Sixty-Nine Dollars and Eighty-Six Cents
     ($1,369.86) ($7,500,000 divided by 5475 days) and paid quarterly in
     arrears, without interest."

XM SATELLITE RADIO INC., XM SATELLITE RADIO HOLDINGS INC.              JULY 2003
and BOEING SATELLITE SYSTEMS                                           Amendment
INTERNATIONAL, INC. CONFIDENTIAL & PROPRIETARY   11               Contract L0634

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     (d) The following new Article 12.11 (Incentives for Extended Life of XM-4)
     is added to Article 12:

     "12.11 Incentives for Extended Life of XM-4.

          Beginning the first day after the end of the Orbital Design Life of
     XM-4 and ending the last day of the fifth year thereafter, Contractor shall
     have the right to earn, in addition to the Incentive Amounts applicable to
     XM-4, a total of Ten Million Dollars ($10,000,000) in XM-4 Extended Life
     Incentives. Such incentives shall be earned at the daily rate of Five
     Thousand Four Hundred Seventy-Nine Dollars and Forty-Five Cents ($5,479.45)
     ($10,000,000 divided by 1825 days) for each day XM-4 is fully capable of
     being a Satisfactorily Operating Satellite and provided [***]. In the event
     Customer is not utilizing XM-4 for its commercial business at the end of
     the Orbital Design Life, Customer and Contractor shall mutually select an
     independent third party who shall be responsible for determining if XM-4 is
     fully capable of being a Satisfactorily Operating Satellite and [***].
     Customer shall pay such XM-4 Extended Life Incentives quarterly in arrears,
     without interest; such incentives shall not exceed Two Million Dollars
     ($2,000,000) per year and Ten Million Dollars ($10,000,000) over the five
     year period."

     (e) The following new Article 12.12 (XM-4 Loss; High Performance and
     Extended Life Incentives):

     "12.12 Article 12.12 (XM-4 Loss; XM-4 High Performance and Extended Life
     Incentives)

     In the event the XM-4 Satellite is a Total Loss, Constructive Total Loss or
     Partial Loss, whether or not there is a successful injection of the
     Satellite into its specified orbit by the Launch Vehicle, Contractor shall
     not be entitled to be paid XM-4 High Performance Incentives and XM-4
     Extended Life Incentives."

9.   Amendment of Article 25.2 (Launch and In-Orbit Insurance). The third
     sentence in Article 25.2(a) is deleted in its entirety and replaced with
     the following:

          "Customer shall use reasonable efforts to require its Insurers to
          waive all rights of subrogation against Contractor."

10.  Amendment of Article 28 (Launch Services). The following new Article 28(h)
     is added to Article 28:

          "(h) Customer shall be responsible for procuring the Launch Vehicle
          for XM-4. Contractor shall, at no additional cost to Customer,
          interface and

XM SATELLITE RADIO INC., XM SATELLITE RADIO HOLDINGS INC.              JULY 2003
and BOEING SATELLITE SYSTEMS                                           Amendment
INTERNATIONAL, INC. CONFIDENTIAL & PROPRIETARY   12               Contract L0634

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          work with the selected Launch Agency as required for the design,
          integration, test and launch of the XM-4 Satellite on the selected
          Launch Vehicle, including Contractor provision of the services,
          deliverable data and equipment specified in Exhibit B-2 (XM-4
          Statement of Work).

               (1) Baseline Launch Vehicle: The baseline Launch Vehicle is Sea
          Launch (6000 kg capacity). In the event XM elects to launch XM-4 on
          the Sea Launch launch vehicle, XM shall be responsible for procuring
          the Sea Launch launch vehicle (6000 kg).

               The price for said Sea Launch launch vehicle is $[***] and is
          based on the payment plan identified below. Customer will negotiate
          all other terms directly with Sea Launch. Required payments to be made
          by Customer to Sea Launch (under a Launch Agreement) shall be as
          follows:

          ------------------------------
          Amount ($M)   Payment Due Date
          ------------------------------
             $[***]         [***]
          ------------------------------
             $[***]         [***]
          ------------------------------
             $[***]         [***]
          ------------------------------
             $[***]         [***]
          ------------------------------
             $[***]         [***]
          ------------------------------
             $[***]         [***]
          ------------------------------
             $[***]         [***]
          ------------------------------

          All payments for the Sea Launch launch vehicle shall be made to Sea
     Launch prior to Launch of XM-4.

          Upon execution of a Launch Agreement for XM-4 by Customer and Sea
     Launch, the pricing and payment schedule set forth above shall be
     superceded in their entirety by the provisions of such Launch Agreement.

               (2) Alternate Launch Vehicle. Contractor confirms that XM-4 is
          compatible (e.g., quasi-static loads and static envelope clearances)
          and will be compatible (e.g., launch vehicle adapter compatibility)
          with the following Launch Vehicles, in addition to the Sea Launch:
          [***]. In the event XM-4 is Launched on a Launch Vehicle other than
          the Sea Launch, Customer shall pay the following additional costs,
          such additional costs include any and all additional work relating to
          Launch of the XM-4 Satellite on an alternative Launch Vehicle,
          including but not limited to additional work related to transportation
          to Launch Site, Launch Campaign, Launch and Mission Operations:

          Incremental Firm Fixed Price Increase for Alternative Launch Vehicles

XM SATELLITE RADIO INC., XM SATELLITE RADIO HOLDINGS INC.              JULY 2003
and BOEING SATELLITE SYSTEMS                                           Amendment
INTERNATIONAL, INC. CONFIDENTIAL & PROPRIETARY   13               Contract L0634

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                           [***]
                           [***]
                           [***]

     Payment of the incremental price increase for an Alternative Launch
     Vehicle, if applicable, shall be made by XM no later than [***] prior to
     Launch of XM-4.

          (3) Customer shall notify Contractor as to the selected Launch Vehicle
     no later than [***] after XM-4 EDC; any change of Launch Vehicle from the
     one selected by Customer shall be a customer-directed change to the
     Contract."

11.  Amendment of Article 32.1 (Termination for Customer's Convenience). In the
     first sentence of Article 32.1(d), the phrase "and Exhibit G-3 (XM-4
     Payment Plan, Termination Liability Amounts and Payment Plans for Incentive
     Amounts, High Performance Incentives and Extended Life Incentives) for the
     XM-4 Satellite, as applicable" shall be added after the phrase "Exhibit G-2
     (Ground Spare Satellite Payment Plan, Termination Liability Amounts and
     Incentive Amounts) for the Ground Spare Satellite".

12.  Amendment to Article 32.2 (Termination for Contractor's Default). The
     following new subparagraphs (ix), (x), and (xi) are added to Article
     32.2(a)(1):

     "(ix) Conduct XM-4 Spacecraft Systems Requirements Review (SRR) by [***];

     (x) Conduct XM-4 Spacecraft Critical Design Review (CDR) by [***];

     (xi) Mate Bus and Payload Module for XM-4 by [***]."

13.  XM-4 Insurance Matters.

     [***].

14.  Amendment to Article 29 (Customer's Responsibilities). Article 29 shall be
     amended to include the following new paragraphs (j) and (k):

     "(j) Customer shall provide written direction to Contractor no later than
     [***] of the Command and Telemetry frequencies to be used for XM-4.

     (k) For XM-4, Customer will supply (i) the Launch Vehicle and (ii) Launch
     Agency Services. As promptly as practicable, and in any event no later than
     [***], Customer will designate in writing to Contractor the selected Launch
     Agency and the Designated Launch Site; and Customer will notify Contractor
     promptly in the event of any changes in the Launch Agency and the
     Designated Launch Site. In addition,

XM SATELLITE RADIO INC., XM SATELLITE RADIO HOLDINGS INC.              JULY 2003
and BOEING SATELLITE SYSTEMS                                           Amendment
INTERNATIONAL, INC. CONFIDENTIAL & PROPRIETARY   14               Contract L0634

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     Customer will identify in writing to Contractor the Launch Slot [***] and
     the Launch Date [***] and will promptly update Contractor to any changes to
     such dates. "

15.  Amendment to Article 9.1 (Transfer of Title). The second sentence of
     Article 9.1 shall be deleted in its entirety and replaced with the
     following sentences:

     "Transfer of title, free and clear of all liens and encumbrances of any
     kind, (i) to XM-1, XM-2 and XM-3 shall pass to Customer at the time of
     Initial Handover of such Satellite, or in the event of Constructive Total
     Loss or Total Loss, at the time of such Constructive Total Loss or Total
     Loss, or in the event such Satellite is placed in storage, as provided in
     Article 14.4 (Storage); (ii) to XM-4 shall pass to Customer at the time of
     Launch, or in the event such Satellite is placed in storage, as provided in
     Article 14.4 (Storage); provided that notwithstanding any other provision
     in the Contract, transfer of title of the XM-3 Satellite Bus shall only
     occur after all amounts owing BCSC are repaid under the Customer Credit
     Agreement."

16.  Amendment to Article 11.3 (Maximum Excusable Delay; Termination).
     Customer's right to terminate the Contract with respect to the XM-4
     Satellite pursuant to Article 11.3(b) shall arise if and when it becomes
     reasonably certain that the aggregate of Excusable Delays (except those
     Excusable Delays caused directly by Customer's failure to perform its
     responsibilities under the Contract) will exceed three hundred sixty-five
     (365) Calendar Days.

17.  Amendment to Article 30 (Options). Article 30 (Options) is deleted in its
     entirety and replaced with the following:

     "30. OPTIONS

          30.1 Options Granted.

          Contractor hereby grants to Customer the options set forth in this
          Article 30 (Options) to be exercised at Customer's sole discretion.

          30.2 XM-5 Satellite Option

          Customer may purchase one (1) additional Satellite (the "XM-5
          Satellite" or "fifth satellite") to be delivered on-ground and, if
          launched, accepted in-orbit, and of design, configuration and
          performance identical to the XM-4 Satellite (except with an optimized
          antenna, as directed by Customer, either for 85(Degree) W longitude
          orbital location (i.e., the existing XM-1 orbital location) [***] with
          respect to XM-3, or 115(Degree) W longitude orbital location (i.e.,
          the existing XM-2 orbital location) [***]. Any change of the antenna
          configuration from the

XM SATELLITE RADIO INC., XM SATELLITE RADIO HOLDINGS INC.              JULY 2003
and BOEING SATELLITE SYSTEMS                                           Amendment
INTERNATIONAL, INC. CONFIDENTIAL & PROPRIETARY   15               Contract L0634

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          one selected by Customer shall be a customer-directed change to the
          Contract.

          (a) Fixed Price Option Period.

          Customer may exercise this option to order the XM-5 Satellite at the
          fixed price set forth in paragraph (c) below at any time through the
          later of (1) [***] or (2) [***] after Launch where the XM-4 Launch is
          postponed in the event of an Excusable Delay in accordance with
          Article 11 (Excusable Delay) or a Contractor unexcused delay (the
          "Fixed Price Option Period"). In the event of an Excusable Delay in
          accordance with Article 11 (Excusable Delay) or a Contractor unexcused
          delay, the Option Period shall be extended day-for-day for the period
          of such delay.

          (b) Delivery.

          Contractor shall perform the work in connection with the XM-5
          Satellite, if ordered, so the XM-5 Satellite is Available for Shipment
          within twenty-seven (27) months after order.

          (c) Price and Payment.

          The price for the XM-5 Satellite ordered within the Fixed Price Option
          Period is [***] in Incentive Amounts and all other items listed in
          Article 2.4 and Article 4.1 (Contract Price). In the event Customer
          requests, Contractor shall provide [***] for XM-4 on the price and
          terms set forth in Article 2.6 (applicable to XM-3).

          In the event Customer exercises this option to order the XM-5
          Satellite after the Fixed Price Option Period has expired and no later
          than [***], the price stated above shall be increased by [***] for
          each quarter beginning [***] until the date of placement by Customer
          of such order.

          The price for the XM-5 Satellite shall be paid in accordance with a
          payment plan to be mutually agreed to at the time of option exercise
          (consistent with customary industry payment plans).

          (d) Contract Adjustments.

          Contractor shall furnish the XM-5 Satellite and all related items,
          services and equipment in accordance with the provision of the
          documents constituting the Contract (and specifically those Exhibits
          applicable to the XM-4 Satellite, i.e., Exhibit A-2 (XM-4 Spacecraft
          Performance Specification), Exhibit B-2

XM SATELLITE RADIO INC., XM SATELLITE RADIO HOLDINGS INC.              JULY 2003
and BOEING SATELLITE SYSTEMS                                           Amendment
INTERNATIONAL, INC. CONFIDENTIAL & PROPRIETARY   16               Contract L0634

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          (XM-4 Statement of Work)). For clarification, Article 10.1(d) (i.e,.
          liquidated damages provision for XM-4), Article 12.10 (XM-4 High
          Performance Incentives), Article 12.11 (XM-4 Extended Life Incentives)
          and Article 12.12 (XM-4 Loss; XM-4 High Performance Incentives and
          XM-4 Extended Life Incentives) shall also be applicable to the XM-5
          Satellite, however, Article 5.9 (Payment and Deferred Financing for
          XM-4) and Article 5.10 (Grant of Warrant) shall not be applicable to
          the XM-5 Satellite. Except as otherwise provided by this Article 30.2
          (XM-5 Satellite Option), the contract terms and conditions for the
          XM-5 Satellite will be identical to the Terms and Conditions of this
          Contract, including the specific terms applicable to the XM-4
          Satellite.

          30.3 Contract Adjustments

               Should Customer exercise any or all of the options described in
          this Article 30 (Options), the Parties shall execute Amendment(s) as
          soon as is reasonably possible after option exercise to incorporate
          the schedule adjustments, price adjustments, payment schedule
          adjustments, and changes to the Exhibits and other Terms and
          Conditions as made necessary by such exercise. Except as otherwise
          provided in this Article 30 (Options), the terms of this Contract
          shall apply to any such options."

18.  Article 22 (Confidential Information).

     [***].

19.  Entire Agreement; Counterparts.

     There is no modification to the Contract except as expressly set forth in
     this July 2003 Amendment and all terms, provisions and conditions of the
     Contract shall be in full force and effect, provided that any provisions in
     the Contract that are inconsistent with this July 2003 Amendment shall be
     construed so as to be consistent with this July 2003 Amendment. This July
     2003 Amendment may be executed in one or more counterparts, which together
     shall constitute a fully executed agreement.

IN WITNESS WHEREOF, the Parties hereto have executed this July 2003 Amendment to
the Satellite Purchase Contract No. L0634, effective as of the date first
written above (the "Effective Date").

BOEING SATELLITE SYSTEMS   XM SATELLITE RADIO INC.

XM SATELLITE RADIO INC., XM SATELLITE RADIO HOLDINGS INC.              JULY 2003
and BOEING SATELLITE SYSTEMS                                           Amendment
INTERNATIONAL, INC. CONFIDENTIAL & PROPRIETARY   17               Contract L0634

<PAGE>

INTERNATIONAL, INC.

BY:                                    BY:
    --------------------------------       -------------------------------------
Name: Lisa Dull                            Name: Gary M. Parsons

Title: Director, Comm/Intl Business        Title: Chairman

Date:  July 31, 2003                       Date: July 31, 2003

                                       XM SATELLITE RADIO HOLDINGS INC.

BY:                                    BY:
    --------------------------------       -------------------------------------
Name: Dave Ryan                            Name: Gary M. Parsons

Title: President                           Title: Chairman

Date: July 31, 2003                        Date: July 31, 2003

XM SATELLITE RADIO INC., XM SATELLITE RADIO HOLDINGS INC.              JULY 2003
and BOEING SATELLITE SYSTEMS                                           Amendment
INTERNATIONAL, INC. CONFIDENTIAL & PROPRIETARY   18               Contract L0634

<PAGE>

[LOGO] SATELLITE RADIO

                             XM Satellite Radio Inc.

================================================================================

   Exhibit B2 - Rev. 0.2

--------------------------------------------------------------------------------

Statement of Work - XM-4

     Last Saved: July 29, 2003

Document Number: XM-SC-XM4002

                           DOCUMENT RELEASE APPROVALS

----------------------------------------------------
Approved by                                     Date

Derek de Bastos
Vice President, Engineering
XM Satellite Radio Inc.
====================================================
Approved by                                     Date

Terry Lamb
Program Manager: XM Spacecraft
Boeing Satellite Systems
====================================================
Approved by:

Jeff Snyder

Senior Vice President, Space and Ground
Systems, XM Satellite Radio, Inc,
----------------------------------------------------

<PAGE>

--------------------------------------------------------------------------------
Revision Log

This log identifies those portions of this document that have been revised since
the original issue and the date of each revision.

----------------------------------------------------------------------------
Rev   Authorizing   Summary of Changes to Previous     Date      Approval
       Document                Version
----------------------------------------------------------------------------
 -                  Initial Version                  7/30/2003    /s/

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--------------------------------------------------------------------------------
Table of Contents

Revision Log...................................................................2

Table of Contents..............................................................3

Table of Figures..............................................................10

Table of Tables...............................................................10

1 PURPOSE AND SCOPE...........................................................11

   1.1 DOCUMENT ORGANIZATION..................................................11

2 EQUIPMENT, DATA, AND SERVICES...............................................13

   2.1 DELIVERABLE EQUIPMENT..................................................13

      2.1.1 Flight Spacecraft.................................................13

      2.1.2 [****]:...........................................................13

      2.1.3 INTENTIONALLY LEFT BLANK..........................................13

      2.1.4 Satellite Control Software [****].................................13

      2.1.5 Delivery Schedule.................................................14

   2.2 TEST AND HANDLING EQUIPMENT............................................14

   2.3 SHIPPING AND STORAGE CONTAINERS........................................14

   2.4 DATA...................................................................14

   2.5 SERVICES...............................................................15

   2.5.1 Launch Support Services..............................................15

         2.5.1.1 Launch Operations Planning and Coordination..................15

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         2.5.1.2 Launch Support Documentation.................................17

         2.5.1.3 Launch Site Operation Plan...................................17

         2.5.1.4 Launch Site Operations.......................................17

         2.5.1.5 Other Contractor Responsibilities............................18

         2.5.1.6 Other Customer Responsibilities..............................18

      2.5.2 [****]............................................................18

      2.5.3 COMPATIBILITY WITH THE [****].....................................18

      2.5.4 LEOP MISSION SERVICES.............................................18

      2.5.5 TRAINING..........................................................19

      2.5.6 RESERVED..........................................................19

      2.5.7 LAUNCH AND IN-ORBIT INSURANCE.....................................19

      2.5.8 MISSION SUPPORT SERVICES..........................................19

   2.6 DELIVERABLE DATA AND DOCUMENTATION.....................................20

   2.7 VISIBILITY OF FAILURES/PROBLEMS ON OTHER PROGRAMS......................20

3 QUALIFICATION, REVIEWS, AND ANALYSES........................................21

   3.1 EQUIPMENT QUALIFICATION................................................21

   3.2 DESIGN REVIEWS.........................................................21

      3.2.1 SPACECRAFT SYSTEM REQUIREMENTS REVIEW (SRR).......................21

      3.2.2 SPACECRAFT CRITICAL DESIGN REVIEW (SCDR)..........................22

      3.2.3 CONDUCT OF DESIGN REVIEWS.........................................23

         3.2.3.1 Design review board..........................................23

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         3.2.3.2 Design Review Notification...................................24

         3.2.3.3 Data package.................................................24

         3.2.3.4 Presentation materials.......................................24

         3.2.3.5 Minutes......................................................24

         3.2.3.6 Notification of Review Completion............................24

      3.2.4 DESIGN REVIEWS BY SUBCONTRACTORS..................................25

3.3  OTHER REVIEWS............................................................25

      3.3.1 UNIT ACCEPTANCE REVIEWS...........................................25

      3.3.2 SYSTEM TEST REVIEWS...............................................25

      3.3.3 SHIPMENT READINESS REVIEW (SRR)...................................26

      3.3.4 FLIGHT READINESS REVIEWS (FRR)....................................26

      3.3.5 LAUNCH READINESS REVIEWS (LRR)....................................26

      3.3.6 IN-ORBIT ACCEPTANCE TEST REVIEW (IOTR)............................27

      3.3.7 MRR, TRR, AND TRB PARTICIPATION...................................27

3.4  ANALYSES.................................................................27

      3.4.1 GENERAL DESIGN AND PERFORMANCE ANALYSES REQUIREMENTS..............27

      3.4.2 [****] ANALYSIS...................................................28

      3.4.3 [****] ANALYSIS...................................................28

      3.4.4 [****] ANALYSIS...................................................28

      3.4.5 [****] ANALYSIS...................................................28

      3.4.6 [****] ANALYSIS...................................................28

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      3.4.7  [****] ANALYSIS..................................................28

      3.4.8  [****] ANALYSIS..................................................29

      3.4.9  [****] ANALYSIS..................................................29

      3.4.10 [****] PERFORMANCE...............................................29

      3.4.11 [****] ANALYSES..................................................29

      3.4.12 [****] ANALYSIS..................................................29

      3.4.13 [****] ANALYSES..................................................29

      3.4.14 [****] ANALYSIS..................................................30

      3.4.15 [****] ANALYSES..................................................30

      3.4.16 [****] ANALYSIS..................................................30

      3.4.17 [****] ANALYSIS..................................................30

4 PROGRAM MANAGEMENT REQUIREMENTS.............................................31

   4.1 CONTRACTOR  MANAGEMENT ORGANIZATION....................................31

   4.2 PROGRAM CONTROL........................................................31

   4.3 CONFIGURATION CONTROL..................................................31

   4.4 XM MANAGEMENT ORGANIZATION.............................................31

   4.5 XM/CONTRACTOR RELATIONS................................................32

   4.6 MEETINGS...............................................................33

      4.6.1 CONTRACT KICKOFF MEETING..........................................33

      4.6.2 INTERIM AND QUARTERLY PROGRESS MEETINGS...........................34

      4.6.3 SENIOR MANAGEMENT MEETINGS........................................34

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      4.6.4 REVIEW MEETINGS...................................................34

   4.7 PROGRAM SCHEDULE NETWORKS..............................................35

   4.8 PROGRAM MILESTONE PAYMENT STATUS.......................................35

      4.8.1 SUBMITTED INVOICES................................................35

      4.8.2 ANTICIPATED INVOICE SUBMITTALS....................................36

      4.8.3 MILESTONE PAYMENT STATUS GRAPHS...................................36

      4.8.4 AUDITOR'S CERTIFICATION...........................................36

   4.9 MANAGEMENT OF CONTRACT CHANGES.........................................36

      4.9.1 PRELIMINARY CHANGE ASSESSMENT.....................................37

      4.9.2 CONTRACT CHANGE NOTICE (CCN)......................................37

      4.9.3 REVIEW AND APPROVAL OF CONTRACT CHANGE NOTICE.....................38

      4.9.4 WAIVERS AND DEVIATIONS............................................38

      4.9.5 REVIEW AND APPROVAL OF AN RDW.....................................39

5  PRODUCT ASSURANCE REQUIREMENTS.............................................40

6  INFORMATION................................................................41

   6.1 ACCESS TO INFORMATION..................................................41

   6.2 RELEASE OF Command Radio Frequency and AdDress Code INFORMATION........41

7  TRAINING AND OPERATION SUPPORT SERVICES....................................42

   7.1 VERIFICATION OF [****].................................................42

   7.2 TRAINING OF XM OPERATIONS PERSONNEL....................................42

   7.3 RESERVED...............................................................42

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8  DATA AND DOCUMENTATION REQUIREMENTS........................................43

   8.1 LANGUAGE...............................................................43

   8.2 UNITS AND DIMENSIONS...................................................43

   8.3 NOMENCLATURE, ACRONYMS AND ABBREVIATIONS...............................43

   8.4 DOCUMENT REFERENCE/IDENTIFICATION SYSTEM...............................44

   8.5 CDRL ITEM DESCRIPTIONS.................................................44

      8.5.1 SPACECRAFT DELIVERY PLAN..........................................44

      8.5.2 QUARTERLY PROGRAM PROGRESS REPORTS................................44

      8.5.3 DESIGN REVIEW PACKAGE.............................................46

         8.5.3.1 Spacecraft Systems Requirements Review data package..........46

         8.5.3.2 Critical design review data package..........................47

      8.5.4  SPACECRAFT VALIDATION PLAN.......................................48

      8.5.5  SPACECRAFT STORAGE PLAN..........................................48

      8.5.6  SPACECRAFT SYSTEMS SUMMARY.......................................49

      8.5.7  [****]...........................................................49

      8.5.8  SPACECRAFT ASSEMBLY DRAWINGS AND CIRCUIT DIAGRAMS................49

      8.5.9  FLIGHT SOFTWARE/FIRMWARE DOCUMENTATION...........................50

      8.5.10 [****]...........................................................50

         8.5.10.1 [****] contents.............................................50

         8.5.10.2 [****] contents.............................................50

         8.5.10.3 Submission requirements.....................................50

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      8.5.11 SPACECRAFT OPERATIONS HANDBOOK...................................51

         8.5.11.1 [****]......................................................51

         8.5.11.2 [****]......................................................51

         8.5.11.3 [****]......................................................51

         8.5.11.4 [****]......................................................51

         8.5.11.5 [****]......................................................51

      8.5.12 [****]...........................................................51

         8.5.12.1 [****]......................................................52

         8.5.12.2 [****]......................................................52

         8.5.12.3 Data Documentation and Delivery.............................52

      8.5.13 ANALYSIS.........................................................52

   8.6 DETAILED CDRL..........................................................53

      8.6.1 SUBMISSION CRITERIA DEFINITIONS:..................................53

         8.6.1.1 Approval.....................................................53

         8.6.1.2 Review.......................................................53

         8.6.1.3 Information..................................................53

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--------------------------------------------------------------------------------

 Table of Figures

--------------------------------------------------------------------------------
Table of Tables

   Table 1: Meetings Conducted or Participated in by Contractor...............35

   Table 2 [****].......................................................Attached

   Table 3: Satellite Control Software..................................Attached

<PAGE>

--------------------------------------------------------------------------------
1    PURPOSE AND SCOPE
--------------------------------------------------------------------------------

1.1  DOCUMENT ORGANIZATION

          This Exhibit provides the Statement of Work (SOW) for the XM-4
          Spacecraft Contract. Sections 8.5 and 8.6 give the contract data and
          documentation requirements.

          This Exhibit defines the work to be performed by the Contractor for
          the XM DARS Spacecraft program. This work includes deliverable
          equipment, hardware, services and documents. The Contractor shall
          complete this work in accordance with the Terms and Conditions of the
          Contract and the requirements specified herein.

          The Contractor shall be fully responsible for all tasks unless
          otherwise stated. These tasks shall include the design, development,
          fabrication, and testing of two flight spacecraft. These spacecraft
          shall be designed, fabricated, and tested in accordance with the
          requirements given in Contract Exhibits A2, C, D and E. The Contractor
          shall provide delivery of one spacecraft in-orbit, including
          transportation to the launch site, launch support, Launch and Early
          Operations phase (LEOP) maneuvers and deployments, in-orbit test
          services, training on the operation of the satellite, and mission
          support services for the life of the satellites.

          The Contractor shall also provide an option for a fifth satellite
          (XM-5), and in accordance with the Contract Terms and Conditions
          complete the fifth spacecraft and deliver it to storage as a ground
          spare, or launch it to replace a failed spacecraft at Customer's
          direction.

          The Contractor shall provide documentation and data delivered in
          accordance with the Contract Data Requirements List (CDRL) given in
          section 8.6 DETAILED CDRL.

          The Contractor shall provide an update specific to XM-4 for the
          Dynamic Spacecraft Simulator.

          The Contractor shall deliver, install and test of Spacecraft Control
          Software to the primary and back-up spacecraft control facilities.

<PAGE>

          APPLICABLE DOCUMENTS

          The following documents shall be applicable to this Statement of Work:

          1.   Contract Instrument: Terms and Conditions of the Contract.

          2.   Exhibit A2: XM 4 Spacecraft Performance Specifications

          3.   Exhibit C:  Product Assurance Plan

          4.   Exhibit D:  Test Plan Requirements

          5.   Exhibit E:  Radiation Environment

          6.   Exhibit F2: XM-5 Option for Long Lead Items

          7.   Exhibit G3: XM- 4 Payment Plan and Termination Liability Amounts

          8.   Launch vehicle Users manuals and Launch site safety rules

          Parts of the following documents are incorporated into this Exhibit to
          the extent that they are specifically referenced herein. Where a
          conflict exists, the Statement of Work takes precedence.

               1)   D688-1002D688-10009-1, Sea Launch User's Guide, Revision C,
                    January 2003

               2)   4-1, Sea Launch Safety Regulations Manual (Chapters 3 and
                    4), Rev. New, 16 July 1998

               3)   D688-10658-1, Sea Launch Facilities Accommodations Handbook,
                    Rev Draft, 14 March 2001

                    [NOTE: Preference is to use a SC manufacturer's IRD or
                    technical specification as the reference document for
                    interfaces, environments, and services. When an IRD or tech
                    spec is available (and after proper review of the IRD for SL
                    compatibility), make appropriate reference changes in the
                    SOW.]

          9.   ITU Regulation and reference documents

<PAGE>

--------------------------------------------------------------------------------
2    EQUIPMENT, DATA, AND SERVICES
--------------------------------------------------------------------------------

          The Contractor shall provide spacecraft equipment, related services,
          and data and documentation as specified in this section.

2.1  DELIVERABLE EQUIPMENT

2.1.1 FLIGHT SPACECRAFT

          The Contractor shall deliver one (1) flight Spacecraft (XM-4) meeting
          the performance requirements defined in Exhibit A2, XM-4 Spacecraft
          Performance Specifications. If ordered, an optional spacecraft (XM-5)
          shall be furnished meeting the same performance requirements, except
          as specifically identified. The Spacecraft shall be designed,
          manufactured, and in-plant tested. The Spacecraft shall be delivered
          to the designated launch site as detailed in the Contract or to
          storage as directed by the Customer.

2.1.2 DYNAMIC SPACECRAFT SIMULATOR:

          The Contractor shall deliver to the Customer's Primary Satellite
          Control Center at XM's satellite operator's, Telesat Canada
          (hereinafter referred to as "Telesat") facilities in Gloucester,
          Canada an update to the Dynamic Spacecraft Simulator for XM-4 and for
          XM-5, if required.

2.1.3 INTENTIONALLY LEFT BLANK

2.1.4 SATELLITE CONTROL SOFTWARE (PRIMARY AND BACKUP)

          The Contractor shall deliver Satellite Control Software licenses (ISIS
          software, licenses and installation services and Flight Dynamic
          Software (FDS) license), to the Customer as required for XM-4 and
          XM-5.

<PAGE>

2.1.5 DELIVERY SCHEDULE

          The delivery schedule shall be as follows:

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------
                           Item                                                      Delivery
-------------------------------------------------------------------------------------------------------------
<S>                                                        <C>
XM-4 satellite:                                            In accordance with the Contract Terms & Conditions
-------------------------------------------------------------------------------------------------------------
XM-5 satellite (Option)                                    In accordance with the Contract Terms & Conditions
-------------------------------------------------------------------------------------------------------------
Dynamic Spacecraft Simulator: Updates                      In accordance with the Contract Terms & Conditions
-------------------------------------------------------------------------------------------------------------
Satellite Control Software Licenses (Primary and Backup)   In accordance with the Contract Terms & Conditions
-------------------------------------------------------------------------------------------------------------
</TABLE>

2.2  TEST AND HANDLING EQUIPMENT

          The Contractor shall provide for, in a timely manner, the necessary
          mechanical and electrical ground support equipment required for the
          assembly, handling and transportation, test, and launch. Test and
          handling equipment to be provided by the Contractor for the
          performance of work under the Contract is not deliverable.

2.3  SHIPPING AND STORAGE CONTAINERS

          The Contractor shall make available, as necessary, shipping
          containers, which shall protect the spacecraft from damage during
          transportation. The Contractor shall make available, if necessary,
          storage containers which shall protect the spacecraft from damage
          during storage. Such shipping and storage containers shall remain the
          property of the Contractor.

2.4  DATA

          Documentation and data shall be delivered in accordance with the
          Contract Data Requirements List (CDRL) given in section 8.5 and 8.6
          herein.

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***** Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

2.5  SERVICES

2.5.1 Launch Support Services

          The Customer shall contract directly for Launch Services with the
          designated launch vehicle company. The Contractor shall provide
          technical support, deliverable documentation, and operations support
          necessary to integrate the satellite(s), test and process the
          satellite(s) at the launch site, and support the launch of the
          satellite throughout the launch campaign and mission. The Contractor
          shall assign a XM Radio Mission Manager no later than one month after
          contract signature.

2.5.1.1 Launch Operations Planning and Coordination

          The Contractor shall provide technical support to all Designated
          Launch Agency coordination meetings as scheduled by the Designated
          Launch Agency, including all necessary supporting documentation and
          analyses, and attendance of qualified personnel at all meetings.

          Launch operations include transportation to the launch site, launch
          site (range) operations, Launch Vehicle integration and flight
          operations. The Contractor shall support the Launch Vehicle Meetings
          listed in Table 1B

Table 1B. Launch Vehicle Meetings and Reviews

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------
Title                         Description                                       Date Held
=========================================================================================
<S>                           <C>                                                 <C>
Kick Off Meeting              Development of the contract data requirements       [****]
                              list and commitments will be covered
                              along with mission integration time lines,
                              meeting and review schedules, formats and
                              ground rules.

-----------------------------------------------------------------------------------------

Preliminary Design Review     All requirements from the preliminary ICD will      [****]
(PDR)                         be addressed along with the preliminary
                              design, analyses, and planning that assure that
                              the requirements will be met.

-----------------------------------------------------------------------------------------

Critical Design Review        All requirements from the final ICD will be         [****]
(CDR)                         addressed along with the final design,
                              analyses, and planning that assure that the
                              requirements are met.

-----------------------------------------------------------------------------------------
</TABLE>

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<TABLE>
-----------------------------------------------------------------------------------------
<S>                           <C>                                                 <C>
Ground Operations Working     Two meetings held at Home Port to evaluate          [****]
                              operations requirements for SC, GSE, and
Group Meetings                personnel requirements for launch operations.

-----------------------------------------------------------------------------------------

Hardware Acceptance Review    Final review of design, manufacturing,              [****]
(HAR)                         configuration, and quality assurance buyoff,
                              conducted in conjunction with a physical
                              walk-down of the hardware (whenever
                              appropriate). This review is typically held at
                              Home Port to review closure of any items
                              identified at the delivery reviews discussed
                              above. This review also identifies any changes
                              that have happened to the hardware since
                              delivery to Sea Launch and transportation to,
                              and storage at, Home Port.

-----------------------------------------------------------------------------------------

System Readiness Review       Demonstrates readiness of the Sea Launch system     [****]
                              to support delivery of the SC and XM Radio
                              ground support equipment to Home Port for
                              ground processing and launch activities prior
                              to the receipt of the SC. Includes a report on
                              hardware, facilities, safety, interface
                              verification, permits and licensing, and
                              operations readiness.

-----------------------------------------------------------------------------------------

Ground Operations Readiness   Confirms readiness of the Home Port facilities      [****]
Review                        equipment, procedures, and personnel to perform
                              mission operations with the SC prior to SC
                              arrival.

-----------------------------------------------------------------------------------------

Combined Operations           Confirms readiness of the SC Payload Assembly       [****]
Readiness Review              (PLA), Payload Processing Facility (PPF),
                              equipment, personnel, and procedures to
                              proceed with SC and PLA integration prior to
                              start of combined operations.

-----------------------------------------------------------------------------------------

Payload Unit Transfer         Confirms readiness of the Payload Unit (PLU),       [****]
Readiness Review              Launch Vehicle and the Assembly and
                              Command ship to begin ACS vessel operations
                              including transfer of the PLU to the Command
                              Ship (ACS), mating the PLU with the Block DM-SL
                              and integrated ILV testing prior to
                              transferring the PLU from the PPF to the ACS.
                              Ensures procedures and personnel are ready to
                              support.

-----------------------------------------------------------------------------------------

ILV Transfer Readiness        Confirms readiness of the (Integrated               [****]
Review                        Launch Vehicle) ILV, Launch Platform
                              (LP), and ACS to begin vessel operations
                              including transfer of the ILV to the LP and
                              integrated ILV testing. Ensures hardware,
                              procedures, and personnel are ready to support.

-----------------------------------------------------------------------------------------

Mission Readiness Review      Provides written declaration of readiness from      [****]
                              Sea Launch and XM Radio prior to vessels
                              departure from Home Port including review of
                              hardware, documentation, personnel, safety,
                              logistics support, licensing, and problem
                              reports.

-----------------------------------------------------------------------------------------

Launch Readiness Reviews      Provides written declaration of readiness from      [****]
                              Sea Launch and XM Radio for the start of
                              the launch countdown with a review of hardware,
                              procedures, personnel, and open problem reports
                              that may affect

-----------------------------------------------------------------------------------------
</TABLE>

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requested with respect to the omitted portions.

<TABLE>
<S>                           <C>                                                 <C>
-----------------------------------------------------------------------------------------
                              operations.

-----------------------------------------------------------------------------------------

Status Reviews                Regular communications, usually by                  [****]
                              teleconference. Review Mission
                              Integration schedules and Action Item Lists

-----------------------------------------------------------------------------------------

Technical Interchange         Technical Interchange Meetings and reviews          [****]
Meetings                      between XM Radio and Sea Launch
                              specialists will be scheduled as needed to
                              accomplish mission analysis and operations
                              planning tasks, resolve interface issues, and
                              support requirement verification.

-----------------------------------------------------------------------------------------

2.5.1.2 Launch Support Documentation

          The Contractor shall provide all documentation required by the
          Designated Launch Agency to support launch site operations, flight
          operations, and safety certification, in accordance with the schedules
          specified by the Designated Launch Agency. The Contractor shall
          provide XM with copies of all technical documentation submitted to the
          Designated Launch Agency and XM shall provide copies of the technical
          documentation issued by the Designated Launch Agency to the
          Contractor. The required Launch Vehicle Deliverables are itemized in
          Table 4, Launch Vehicle Deliverables.

2.5.1.3 Launch Site Operation Plan

          The Contractor shall provide a Launch Site Operations Plan detailing
          all activities required at the Designated Launch Site, a test
          procedure summary, and schedule. The launch site operations plan shall
          also provide a launch team organization/management chart that defines
          interfaces and responsibilities. This plan may include the facilities
          requirements summary.

2.5.1.4 Launch Site Operations

          The Contractor shall provide at the Designated Launch Site, the
          necessary personnel, support equipment and supplies, e.g., propellants
          and spares, to assemble and check out the flight Spacecraft and
          establish its readiness for launch.
</TABLE>

<PAGE>

***** Certain information on this page has been omitted and filed separately
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          The Contractor shall also provide transportation for the Satellite,
          all Contractor personnel, and equipment to and from the Designated
          Launch Site, and accommodation and living expenses for the duration of
          the launch site operations

          The Contractor shall provide the level of support required to perform
          integration operations in accordance with the standard Launch Vehicle
          activity schedule including multi-shift operations as required.

2.5.1.5 Other Contractor Responsibilities

          The Contractor shall perform one fit check for each Spacecraft to
          verify the compatibility of the mechanical and electrical interfaces
          between the Spacecraft and the SCA. This fit check is accomplished at
          the Launch Vehicle Payload Processing Facility and does not include
          firing of the separation system.

2.5.1.6 Other Customer Responsibilities

          Customer engineers may participate in the launch campaign and the
          Customer shall make arrangements with the Designated Launch Agency for
          separate office accommodations and support for Contractor.

2.5.2 [****]

          The Contractor shall contract for the provision of [****] as needed to
          support the launch. The Contractor shall demonstrate the compatibility
          of the spacecraft design with this [****].

2.5.3 [****]

          The Contractor shall specify, with input from XM, the [****].

2.5.4 LEOP MISSION SERVICES

          The Contractor shall perform the Launch and Early Operations phase
          (LEOP) maneuvers, deployment of each satellite at its operating orbit
          location, and the in-orbit acceptance test (IOT). [****]

<PAGE>

***** Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

          The Contractor shall provide a qualified team and facilities for the
          conduct of LEOP services.

2.5.5 TRAINING

          The Contractor shall verify the [****], provide XM and Telesat with
          updated training for operation of the XM-4 (XM-5) satellites in
          geosynchronous orbit. The Contractor shall be responsible for all the
          necessary training activities and related operating procedures.
          Training shall be provided for operations staff including engineers
          and controllers, and shall cover all systems, documentation, and
          procedures. Training shall include Operational Qualification of
          engineers and controllers to perform daily operations and anomaly
          investigation.

2.5.6 RESERVED

2.5.7 LAUNCH AND IN-ORBIT INSURANCE

          All the necessary launch and in-orbit insurance services shall be
          procured by XM and shall cover Contractor's operation of the
          satellites. The scope of the Contractor effort in this regard shall be
          limited to providing the insurance agency with the support
          documentation required by the insurer, if any, and support for
          meetings with the insurers.

2.5.8 MISSION SUPPORT SERVICES

          Beginning with Handover of the last XM spacecraft and continuing for a
          period of at least 15 years, the Contractor shall provide on-call
          support to answer questions from XM's satellite operator, Telesat
          Canada, regarding the performance of any of the XM spacecraft,
          providing that these questions do not require extensive analysis. The
          Customer through its satellite operator, Telesat shall provide [****]
          for the Contractor to respond to these questions. If responding to the
          Customer's or Telesat's questions would require extensive analysis,
          the Contractor shall provide an estimate of the

<PAGE>

          extent of effort required, and the Customer shall either agree to pay
          for this additional analysis or shall withdraw the question.

2.6  DELIVERABLE DATA AND DOCUMENTATION

          XM shall have access as needed to all non-financial data,
          documentation, and information related to the Contract that is
          generated under this Contract by the Contractor and Subcontractors
          consistent with U.S. Government regulations. Certain specific items of
          information shall be produced and formally submitted to XM or to
          Telesat by the Contractor as specified in the CDRL and data item
          descriptions given in Section 8.5 and 8.6 herein.

2.7  VISIBILITY OF FAILURES/PROBLEMS ON OTHER PROGRAMS

          The Contractor shall provide XM with immediate and full visibility of
          all technical/programmatic aspects of failures and problems occurring
          at component (piece part), unit, subsystem, or system level on other
          programs, on ground or in orbit, that are relevant to the XM
          spacecraft, and of associated corrective actions. XM shall keep such
          information strictly confidential. The identities of other Customer
          programs do not need to be revealed to XM, either directly or by
          inference, except with the express permission of the respective
          Customers.

<PAGE>

-------------------------------------------------------------------------------
3    QUALIFICATION, REVIEWS, AND ANALYSES
-------------------------------------------------------------------------------

3.1  EQUIPMENT QUALIFICATION

          Prior to spacecraft delivery for launch, all flight equipment shall be
          fully qualified for all space flight environments to which it will be
          subjected as defined in Exhibits D and E.

3.2  DESIGN REVIEWS

          A Spacecraft System Requirements Review (SRR) and Critical Design
          Reviews (CDRs) shall be conducted at the spacecraft system level. Each
          design review shall be a comprehensive, critical audit of the design.
          The design review program shall not only encompass a thorough review
          of new hardware designs and modified designs, but shall also take into
          account those existing qualified designs that will result in the
          achievement of the XM performance and environmental requirements.

          Without relieving the Contractor of its responsibilities for efforts
          under the Contract, the XM Program Director will co-chair system level
          design reviews. The Contractor shall provide the logistics for these
          reviews, shall make the review presentations, and shall provide
          required documentation as described within the CDRL.

          The Contractor shall compile and maintain a uniform program listing of
          all action items. The status of these action items shall be tracked
          through closure.

3.2.1 SPACECRAFT SYSTEM REQUIREMENTS REVIEW (SRR)

          The purpose of the SRR is to allow XM and the Contractor to confirm
          the baseline concept, configuration and specifications, of spacecraft
          system. The design review package shall be submitted in accordance
          with the CDRL. XM shall have the right to approve the review including
          completion of the review, review meeting minutes, and Major Action
          Item responses.

          The SRR shall comprise a comprehensive review of the requirements for
          the spacecraft and their flow-down to the major subsystems,
          particularly the

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          communications payload. Also to be covered shall be the identification
          of new items to be developed or items to be modified in order to meet
          requirements of the Contract. A comparison of specified and expected
          performance for the communications payload (repeater and antennas)
          shall be reviewed. [****] shall be presented. A [****] shall be
          reviewed.

          The Contractor shall review and present the requirements on the
          spacecraft control equipment (ground segment hardware and software)
          and shall describe the operations concept.

3.2.2 SPACECRAFT CRITICAL DESIGN REVIEW (SCDR)

          The purpose of the SCDR is to allow XM and the Contractor to confirm
          the adequacy of the spacecraft system design, system performance, and
          system test plans. XM shall have the right to approve the review
          including completion of the review, review meeting minutes, and Major
          Action Item responses.

          The SCDR shall comprise a comprehensive review of all new designs, and
          any major modified existing design. The spacecraft performance shall
          be reviewed to verify compliance with contractual design and
          performance requirements. Compliance data for existing designs
          presented at the SRR shall not need to be presented at this review.
          Compliance shall include a presentation of predicted and measured
          performance compared to contractual requirements. [****] shall be
          documented.

          A preliminary version of the Mission Sequence of Events shall be
          presented at the review.

          Changes since the SRR and recommendations from product line problem
          review teams (if any) related to XM as well as the status of their
          implementation on XM spacecraft shall be presented.

<PAGE>

3.2.3 CONDUCT OF DESIGN REVIEWS

3.2.3.1 Design review board

          A qualified Contractor Program Systems Engineering Manager shall,
          along with the XM Program Manager, co-chair the Design Review Board.
          Board members designated by the two co-chairmen shall include
          representatives of Program Management, Systems Engineering,
          responsible engineering activities, Manufacturing, Product Assurance,
          XM representatives, and other technical specialists as required to
          provide a comprehensive appraisal of the spacecraft design. However,
          XM may elect not to provide representatives to the Design Review
          Boards.

          The Board shall make recommendations and ask questions. In addition,
          XM may submit recommendations and questions.

          When a review is scheduled, copies of the design review package shall
          be sent to each member of the review team who shall be responsible
          for:

               .    Studying the data package carefully prior to the design
                    review meeting.

               .    Notifying the responsible engineer of major discrepancies or
                    oversights discovered prior to the meeting.

               .    Attending the meeting fully prepared to discuss the assigned
                    areas of responsibility.

               .    If required, submitting written recommendations for
                    improving the design.

          All recommendations and questions shall be evaluated by the
          Contractor, and responses to all recommendations and questions
          submitted shall be provided. Responsibility for action items shall be
          assigned and a schedule for completion of such items shall be included
          in the design review report.

          Recommendations shall be converted into action items jointly by XM and
          the Contractor.

<PAGE>

3.2.3.2 Design Review Notification

          Transmittal of data packages, including a detailed agenda, to XM and
          to the Design Review Board members shall constitute design review
          notification. The data packages and agenda shall be received at XM
          (XMSPO and Headquarters), to Telesat for the ground segment, at least
          10 full working days in advance of the scheduled review meeting.

3.2.3.3 Data package

          Data packages shall be prepared to support the design review
          presentations. The packages for the SRR and the SCDR shall be
          structured to be stand-alone packages. However, detailed material
          (e.g., analyses provided as appendices) provided at the SRR which has
          not changed at the SCDR need not be resubmitted. Detailed content
          shall comply with the requirements given the CDRL descriptions for SRR
          and SCDR.

3.2.3.4 Presentation materials

          Presentation materials used in the design reviews shall be distributed
          to the participants immediately before the start of each review.
          Presentation materials shall use updated data as applicable, but
          differences between the presentation and data packages shall be noted.

3.2.3.5 Minutes

          Minutes shall include a list of attendees, Major Action items and
          other action items with and closure dates and assignments. Minutes
          shall be distributed to XM and all attendees within 5 working days
          after the meeting.

3.2.3.6 Notification of Review Completion

          A written response to design review recommendations and action items
          approved by the Design Review Chairman and the Program Manager shall
          constitute design review closeout. Each design review report shall be
          signed by the Design Review Board Co-Chairpersons and the Contractor
          Program Manager to signify concurrence with Major Action Items. Action
          items that affect performance or testing of the hardware shall be
          closed out prior to the start of proto-flight testing.

<PAGE>

***** Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

3.2.4 DESIGN REVIEWS BY SUBCONTRACTORS

          XM shall be invited to attend subcontractor design reviews for
          subcontracted equipment of a new and/or modified design. These
          subcontractor design reviews may be scheduled as a session of the
          system design review meetings at the Contractor's facilities or
          separately. This requirement shall not be imposed for existing design
          ("product line") equipment.

3.3  OTHER REVIEWS

          The Contractor shall conduct other reviews as outlined in this
          section. Notification of an upcoming review and all documentation
          pertinent to the review shall be submitted to XM at least 10 working
          days prior to the review, unless provided otherwise in the Contract
          Terms and Conditions. Cognizant Contractor Engineering and management
          representatives shall attend review meetings. XM shall have the right
          to participate in all these reviews.

3.3.1 UNIT ACCEPTANCE REVIEWS

          The Contractor shall review the test data of all units prior to their
          being installed on the spacecraft. These unit reviews shall include
          failure report closures. Unit test data shall be made available for
          review by XM. However, such unit test data shall not be deliverable to
          XM. XM representatives shall have the right to participate in these
          reviews but may elect not to participate.

3.3.2 SYSTEM TEST REVIEWS

          Detailed test data reviews shall be held during the conduct of the
          system level test program, with participation by System Test, System
          Engineering, and XM representatives. The purpose of these reviews
          shall be to assure test data validity in a near real-time manner.
          There shall be pre-test and post-test reviews for each of the
          following test phases : [****].

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requested with respect to the omitted portions.

          The pre-test reviews shall be held prior to each major test phase.
          These reviews shall verify test readiness.

          The post-test phase reviews shall be held immediately at the
          completion of each major test These reviews, conducted by Systems
          Engineering and Systems Test, will include a brief data overview, an
          anomaly list including cause and corrective action status, and open
          issues, if appropriate. The test phase review shall serve to assure
          that the appropriate [****] has been completed and that spacecraft
          status is understood prior to leaving a test facility or major
          configuration.

3.3.3 SHIPMENT READINESS REVIEW (SRR)

          This review shall be conducted at the completion of spacecraft ground
          acceptance testing and shall cover hardware status, test data,
          deviations, and waivers to performance specifications, and status of
          all other CDRL items. The review shall also include mission operation
          readiness and launch campaign planning.

3.3.4 FLIGHT READINESS REVIEWS (FRR)

          The Flight Readiness Review consists of two meetings: 1) Consent to
          Fuel Review and 2) a Satellite Mission Readiness Review.

          The Contractor, upon completion of launch site functional testing (at
          home port) shall conduct the Consent to Fuel Review at home port. The
          Satellite Mission Readiness review shall address the readiness of the
          mission support team and satellite mission control equipment,
          including the [****] and shall be conducted at the Contractor's
          facility.

3.3.5 LAUNCH READINESS REVIEWS (LRR)

          The Contractor shall conduct a Launch Readiness Review (LRR) in order
          to demonstrate that the satellite, mission support, and launch vehicle
          are ready for launch. This review will have representation from the
          Customer, Contractor, and Launch Vehicle Agency.

<PAGE>

3.3.6 IN-ORBIT ACCEPTANCE TEST REVIEW (IOTR)

          At the completion of the spacecraft in-orbit testing, a spacecraft
          acceptance review shall be conducted by the Contractor where hardware
          status, in-orbit test data, anomalies, and comparison with predicted
          performance shall be formally presented for transfer of ownership of
          the spacecraft to XM.

3.3.7 MRR, TRR, AND TRB PARTICIPATION

          XM shall have the right to participate to all the Manufacturing
          Readiness Review (MRR), Test Readiness Review (TRR), and Test Review
          Board (TRB) organized for B, C, D, and E category equipment (as
          defined in Exhibit D) per Exhibit C.

3.4  ANALYSES

          The Contractor shall perform any analyses deemed necessary to
          demonstrate compliance with Contract requirements or to substantiate
          the integrity of the spacecraft delivered under this Contract. All
          analyses shall be consistent with requirements of other applicable
          Contract exhibits.

          The Contractor may use, where relevant, results of valid and
          applicable analyses already performed for similar spacecraft or
          equipment and properly updated for this Contract. The Contractor's
          existing valid, and applicable computer/mathematical models and
          analytical/design tools used for similar spacecraft or equipment may
          also be used to perform the analyses defined herein.

3.4.1 GENERAL DESIGN AND PERFORMANCE ANALYSES REQUIREMENTS

          The Contractor shall perform all design, analytical test, and other
          efforts necessary to demonstrate that the spacecraft complies with the
          requirements of Exhibit A2; that physical parameters are properly
          understood, managed, and accounted for; and that the spacecraft design
          is technically sound taking into account all earth and space flight
          environments to which the spacecraft or any of its component elements
          potentially can be exposed. These efforts shall consider all relevant
          functional, performance, interface, and environmental requirements, as
          well as interactions between the analyses and the test verifications
          of Exhibit D shall be taken into

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          account. The format and submittal of analyses and studies shall be in
          accordance with the CDRL.

3.4.2 [****] ANALYSIS

          The Contractor shall perform a [****] analysis which shall include a
          detailed listing of the [****]. The analysis shall address the [****]
          and included in the Mission Analysis.

3.4.3 [****] ANALYSIS

          A [****] analysis shall be performed and shall consider all critical
          phases of spacecraft life including, at least, [****]. The analysis
          shall also address the [****]

3.4.4 [****] ANALYSIS

          An analysis shall be performed for the various [****]. This analysis
          shall include [****]. The analysis shall address the [****] shall be
          performed.

3.4.5 [****] ANALYSIS

          The Contractor shall perform an [****] analysis, taking into account
          [****]. Analyses shall be based on [****].

3.4.6 [****] ANALYSIS

          The Contractor shall analyze the [****] of the spacecraft for all
          phases of the mission. The analysis shall be based on each required
          launch vehicle's performance [****], and shall take into account all
          significant factors.

          The Contractor shall provide details of the [****] shall be provided.

3.4.7    [****] ANALYSIS

          A [****] analysis shall be provided which shall [****]. The [****]
          analysis shall take into account variables available to the Contractor
          and shall include [****].

          The analysis shall also include but not be limited to:

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requested with respect to the omitted portions.

      [****]

          Based on the [****] analyses, the Contractor shall provide the [****].

3.4.8 [****] ANALYSIS

          The Contractor shall demonstrate by analysis that the [****].

3.4.9 [****] ANALYSIS

          An analysis shall be performed which shall demonstrate that the
          spacecraft design:

      [****]

3.4.10 [****] PERFORMANCE

          The Contractor shall analyze the performance of the [****]

3.4.11 [****] ANALYSES

          The Contractor shall perform all analyses necessary to verify [****].

3.4.12 [****] ANALYSIS

          An analysis and simulation of [****] shall be performed. This analysis
          shall demonstrate that the [****]. The analysis shall identify all
          [****]. [****] shall be performed to show that the [****] during all
          phases of the mission.

3.4.13 [****] analyses

          A complete and comprehensive [****] analysis shall be performed in
          which all [****].

          The Contractor shall provide to the launch agency [****] with
          supporting documentation as needed for [****].

<PAGE>

***** Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

3.4.14 [****] ANALYSIS

          Analyses of the [****], are investigated. All [****] used in these
          analyses shall be [****], unless otherwise agreed to by XM. [****].

          The following shall be included in the [****] analyses:

          [****]

3.4.15 [****] ANALYSES

          All [****] shall be analyzed. Analyses shall include:

          [****]

3.4.16 [****] ANALYSIS

          The Contractor shall perform an [****] analysis.

3.4.17 [****] ANALYSIS

          The Contractor shall perform an analysis of [****].

<PAGE>

--------------------------------------------------------------------------------
4        PROGRAM MANAGEMENT REQUIREMENTS
--------------------------------------------------------------------------------

4.1  CONTRACTOR MANAGEMENT ORGANIZATION

          The Contractor shall ensure that the personnel and facilities
          necessary for the performance of the Contract are assigned and made
          available at the time and places necessary to meet the performance and
          schedule established by this Contract.

4.2  PROGRAM CONTROL

          The Contractor shall establish and apply a program control system that
          provides for monitoring of all program activities and clearly
          identifies all milestones, completion and delivery dates, design
          reviews, and critical paths. This system shall cover the total period
          from the XM-4 Effective Date of Contract (EDC) to the completion of
          the XM-4 in orbit test activities.

4.3  CONFIGURATION CONTROL

          The configuration control plan shall be provided

4.4  XM MANAGEMENT ORGANIZATION

          The XM Spacecraft Program Office (XMSPO) will be the primary technical
          point of contact between the Contractor and XM for technical
          management of this Contract. Telesat will be the primary point of
          contact for operation of the satellites.

          XM shall designate a Spacecraft Program Director who will be
          responsible for ensuring that all technical and programmatic
          requirements of the spacecraft program are satisfied and will have the
          authority (and may delegate authority) to approve for XM on Design
          Review Boards on which XM is a member and on technical and related
          programmatic documentation matters.

<PAGE>

          An XM Contracts Officer will be identified who is responsible for
          conducting Contract negotiations, Contract administration, and all
          modifications to the spacecraft program (including waivers,
          deviations, and Contract Change Notices).

4.5  XM/CONTRACTOR RELATIONS

          At Contract award, the Contractor shall obtain promptly the government
          approvals required to provide access to XM personnel to non-financial
          information relating to the Contract. This access shall be consistent
          with United States Government regulations governing access to
          technical data. In addition to formal contact and communication
          between XM and the Contractor, the Contractor's Program Management
          Office (CPMO) shall arrange for cooperative, open, and unimpeded
          informal contact and communication between XMSPO personnel and their
          counterparts in the Contractor's organization. Technical facilities,
          data, and information used by the Contractor for the program shall be
          open to inspection and evaluation by XM representatives at all
          reasonable times and subject to the regulations noted above. XM shall
          have access by use of permanent badges to all involved facilities and
          all work in process and to technical and status reviews. The
          Contractor shall provide XM with immediate and full visibility of all
          technical/programmatic aspects of failures and problems occurring at
          component (piece part), unit, subsystem, or system level and of
          associated corrective actions. All relevant system level test data
          shall be available for XM to review at any time after the data is
          taken.

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4.6  MEETINGS

          Table 1: Meetings Conducted or Participated in by Contractor

<TABLE>
<CAPTION>
          ------------------------------------------------------------------------------
                  Meeting                 Date or Frequency            Place
          ------------------------------------------------------------------------------
<S>                                           <C>              <C>
          Contract Kickoff Meeting            [****]           Contractor's facility
          ------------------------------------------------------------------------------
          Interim Progress Meeting            [****]           Contractor's facility
          ------------------------------------------------------------------------------
          Quarterly Progress Meeting          [****]           Contractor's facility
          ------------------------------------------------------------------------------
          Senior Management Meetings          [****]           Contractor's facility
          ------------------------------------------------------------------------------
          Progress Meeting with Major         [****]           SubContractor facilities
          ------------------------------------------------------------------------------
          SubContractors (for new and
          modified design equipment)
          ------------------------------------------------------------------------------
          Unit Acceptance Reviews             [****]           Contractor's/
                                                               subContractors
                                                               facilities as appropriate
          ------------------------------------------------------------------------------
          Design Review Meetings              [****]           Contractor's/
                                                               subContractors
                                                               facilities as appropriate
          ------------------------------------------------------------------------------
          Shipment Readiness Review           [****]           Contractor's facility
          ------------------------------------------------------------------------------
          Flight Readiness Review             [****]           Launch site
          ------------------------------------------------------------------------------
          Launch Readiness Review             [****]           As appropriate
          ------------------------------------------------------------------------------
          Meetings with launch                [****]           As appropriate
          services agency
          ------------------------------------------------------------------------------
          Opportunity Meetings                [****]           As appropriate
          ------------------------------------------------------------------------------
          In-orbit Acceptance                 [****]           Contractor facility
          Test Review
          ------------------------------------------------------------------------------
</TABLE>

4.6.1 CONTRACT KICKOFF MEETING

          Within [****] after the effective Date of Contract, the Contractor
          shall conduct a contract kickoff meeting. The purpose of this meeting
          is to confirm the spacecraft technical definition and configuration
          and program requirements subsequent to contract negotiations. An
          additional purpose is to discuss and define the details of
          implementing cooperative working procedures and arrangements between
          ASPO and the Contractor. The topics shall include the following:

          1. Formal communication requirements and formats;

          2. Contractor's organizational charts with specific names of all key
             individuals;

          3. Arrangements for XMSPO access to facilities, documentation, work
             in progress, and informal, technical discussions;

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          4. The Contractor team organization

          5. System/subsystem-level budgets reflecting the performance
             commitments and predictions provided by the Contractor prior to
             contract award and demonstrating the ability of the proposed
             design to meet all Exhibit A performance requirements; and

          6. System and subsystem-level schedules.

4.6.2 INTERIM AND QUARTERLY PROGRESS MEETINGS

          The Contractor shall organize and conduct, under the chairmanship of a
          Program Management Office (PMO) member, regular technical and program
          meetings at which XM representatives (and Telesat, as necessary) will
          participate. The purpose of these meetings shall be to review overall
          program status, schedules, planning, major technical problem areas,
          and any contractual/financial issues and any proposed Contract
          changes, and to discuss and mutually agree upon appropriate courses of
          action for maintaining the integrity of the program. The Interim
          progress meetings shall normally be less formal than the Quarterly
          progress meetings.

4.6.3 SENIOR MANAGEMENT MEETINGS

          Senior Management Meetings shall be conducted at [****] intervals
          between the Contractor and XM senior management to discuss the
          Contractor's progress and related matters. The venue of these meetings
          shall normally be the Contractor's facilities.

          The XMSPO Program Director and the PMO Program Manager may jointly
          prepare the presentation for this meeting based on the agenda
          identified by the senior management staffs of both organizations.

4.6.4 REVIEW MEETINGS

          The Contractor shall conduct reviews as specified in Section 3 of this
          Exhibit. The Contractor shall be responsible for the reviews.

<PAGE>

          The PMO shall be responsible for ensuring the timely completion of
          Action Items and for tracking and reporting their status. A review
          shall be considered conducted when the review chairperson issued the
          minutes and XM has reviewed the minutes. At the conclusion of the
          review, a set of Major Action Items will be mutually agreed to. A
          review shall not be considered completed until after all Major Action
          Items taken at the review meeting have been closed and the
          Notification of Review Completion has been approved by XM. Design
          Review Action Items may be closed to later phase actions and/or plans
          (e.g. during test) at the mutual agreement of the Contractor and
          Customer. Review Minutes, Action Item Responses, and Notification of
          Review of Completion submittals shall be in accordance with the CDRL.

4.7  PROGRAM SCHEDULE NETWORKS

          The Contractor shall conduct program schedule monitoring and analysis
          in accordance with the Contractor's standard practices and procedures.
          The Contractor shall provide XM with program activity networks and
          schedule charts from those schedule activities to assist in the
          forecasting of and preparation for critical program events (reviews
          and quarterly program meetings), as well as for progress evaluation.

4.8  PROGRAM MILESTONE PAYMENT STATUS

          The Contractor shall monitor and present to XM in the Quarterly
          Progress Reports, tables and graphs of the actual and anticipated
          invoice submittals of contract payment milestones as described below:

4.8.1 SUBMITTED INVOICES

          1. Milestone identification number

          2. Milestone description

          3. Value

          4. Amount approved

          5. Invoice date

<PAGE>

4.8.2 ANTICIPATED INVOICE SUBMITTALS

          The Contractor shall present a table of anticipated milestone invoice
          submittals for a period of one year from the month of issue of the
          table. The table shall contain at least the following columns:

          1. Milestone identification number;

          2. Milestone description;

          3. Value;

          4. Anticipated (realistic) invoice date as shown on current program
             schedule.

4.8.3 MILESTONE PAYMENT STATUS GRAPHS

          The Contractor shall present a graph of cumulative milestone values
          over the entire program duration, indicating the Milestone Payment
          Plan amounts, and the cumulative amounts approved to dates.

4.8.4 AUDITOR'S CERTIFICATION

          The Contractor shall have its CFO certify to XM annually that no
          improper payment has been made to any XM official in connection with
          this Contract. Social functions and providing key XM officials with a
          desktop mock-up of the XM spacecraft shall be considered an acceptable
          courtesy.

4.9  MANAGEMENT OF CONTRACT CHANGES

          The Contractor shall establish and maintain a system for managing the
          following types of changes to the XM Contract:

          1. Change to Technical Requirements

          2. Change to the Scope of Work (additions or deletions); and

          3. Change to the Delivery Requirements (schedule).

<PAGE>

4.9.1 PRELIMINARY CHANGE ASSESSMENT

          As an answer to an XM draft change request, prior to formal request
          for change, the Contractor shall provide to XM a preliminary change
          assessment, which includes the following:

          1. A brief description of the change;

          2. rough order of magnitude (ROM) of the cost impact of the change;

          3. estimated schedule impact; and

          4. other special programmatic considerations, including time
             required for a response. XM will evaluate the preliminary change
             assessment and advise the Contractor whether to proceed with a
             detailed proposal.

4.9.2 CONTRACT CHANGE NOTICE (CCN)

          Any contract change raised by the Contractor, either on its own
          initiative or at XM's request, shall be submitted to XM for approval
          in a timely manner in accordance with the Contract. A Contract Change
          Notice form shall be used which shall include the following
          information:

          1. A unique reference number;

          2. Date of submittal;

          3. Identification of organization requesting the change, as well as
             description and justification for the change;

          4. A detailed description of the envisaged tasks in the form of a
             brief statement of work;

          5. A statement of schedule impact;

          6. Price breakdown in a mutually acceptable format;

          7. Suggested contract language revisions as applicable; and

<PAGE>

          8. Proposed implementation date.

4.9.3 REVIEW AND APPROVAL OF CONTRACT CHANGE NOTICE

          XM will notify the Contractor of its acceptance or rejection of a CCN
          in accordance with the Contact Terms and Conditions. Whenever the
          proposed CCN implementation date is deemed critical, XM shall be so
          notified, and a specific early response date requested of XM by the
          Contractor.

          If the Contractor implements a change prior to obtaining XM approval,
          this shall be at the Contractor's own risk.

4.9.4 WAIVERS AND DEVIATIONS

          If, during the execution of the Contract, the Contractor desires to
          depart from the requirements in the Contract for a specific item or a
          limited number of items, a Request for Deviation/Waiver (RDW) shall be
          submitted. Such requests shall comply with the definition of
          Deviations and Waivers specified herein below.

          An RDW shall contain at least the information defined as follows:

          1. A unique RDW reference number

          2. Title or subject of RDW

          3. Affected equipment item name

          4. Affected equipment item part number

          5. Affected requirement at all levels under Contractor responsibility

          6. Description of the waiver or deviation requested

          7. Purpose or justification for request

          8. Date of issue; and

          9. Schedule impact, if any.

<PAGE>

          Waiver and deviation are defined in Exhibit C.

4.9.5 REVIEW AND APPROVAL OF AN RDW

          XM shall make its best efforts to notify the Contractor of its
          acceptance or rejection of the RDW within ten (10) working days of its
          receipt. If the reason for its rejection is lack of adequate
          supporting documentation (or other evidence), the Contractor will be
          informed within ten (10) days of receipt.

<PAGE>

-------------------------------------------------------------------------------
5    PRODUCT ASSURANCE REQUIREMENTS
-------------------------------------------------------------------------------

          The Contractor shall establish and implement a Product Assurance
          Program in accordance with the requirements defined in Exhibit C.

<PAGE>

--------------------------------------------------------------------------------
6    INFORMATION
--------------------------------------------------------------------------------

6.1  ACCESS TO INFORMATION

          XM shall have access, consistent with United States Government
          regulations and individually signed Protection of Proprietary Rights
          agreements, to any information generated on the program or other
          technical data needed to resolve technical issues associated with the
          program. Implementation of such access may be through meetings,
          technical documents or through other methods by mutual agreement.

6.2  RELEASE OF COMMAND RADIO FREQUENCY AND ADDRESS CODE INFORMATION

          The Contractor shall consider and treat all assigned command radio
          frequencies and command address codes used for the spacecraft under
          this Contract and all on-orbit performance date as proprietary to XM.
          All such proprietary information shall not be released to third
          parties without XM's prior approval in accordance with the Contract
          Terms and Conditions.

<PAGE>

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--------------------------------------------------------------------------------
7    TRAINING AND OPERATION SUPPORT SERVICES
-------------------------------------------------------------------------------

7.1  VERIFICATION OF [****]

          The Contractor shall support a test, not to exceed [****], to verify
          [****] and the spacecraft during the Integrated System Test of the
          first flight spacecraft.

7.2  TRAINING OF XM OPERATIONS PERSONNEL

          The Contractor shall prepare and present XM-4 updates to the XM-1/XM-2
          training course for XM and Telesat satellite operations staff.

          The  XM-1/XM-2 course covered [****].

          Reasonable questions not answered during the course shall be responded
          to within one week in writing.

          The updates to the training material shall be submitted to XM and
          Telesat as noted in the CDRL list.

          Each training session shall be video taped, and one copy of the videos
          shall be presented at the conclusion of training.

7.3  RESERVED

<PAGE>

--------------------------------------------------------------------------------
8    DATA AND DOCUMENTATION REQUIREMENTS
--------------------------------------------------------------------------------

          The specific items of information which shall be produced and formally
          submitted to XM by the Contractor are specified herein.

8.1  LANGUAGE

          All deliverable documentation shall be written in the English
          language.

8.2  UNITS AND DIMENSIONS

          Unless otherwise specified, the international system (SI) of units and
          dimensions shall be used in deliverable program documentation,
          however, if the Contractor desires, documentation may contain dual
          units in the format SI (English). SI units shall be used for
          deliverable spacecraft level and unit top assembly level, documents
          and drawings except as follows:

          1.   American Standard fasteners may be used;

          2.   Launch vehicle interface information will be as defined by the
               launch vehicle supplier; and

          3.   Drawings for existing units or components for which the existing
               drawings are in English units.

          4.   Existing analyses and documents

8.3  NOMENCLATURE, ACRONYMS AND ABBREVIATIONS

          The nomenclature and terminology used to define all hardware,
          software, and data items shall be consistent throughout the program.
          The Contractor shall provide a list of acronyms and abbreviations used
          in the program documentation, along with their meanings.

<PAGE>

8.4  DOCUMENT REFERENCE/IDENTIFICATION SYSTEM

          All contract deliverable documents submitted to XM shall contain in
          the headings at least the following:

          1.   Date of issue;

          2.   Subject of document;

          3.   Author or issuing authority;

          4.   Program unique reference identifier and other identifier; and

          5.   Contract Documentation Requirements List (CDRL) item number.

8.5  CDRL ITEM DESCRIPTIONS

          The requirements for those CDRL items, which have specific
          requirements for their contents, are described below. Documents not
          described below may be provided in accordance with the Contractor's
          standard contents and formats.

8.5.1 SPACECRAFT DELIVERY PLAN

          The general Spacecraft Delivery Plan shall be applicable to the
          selected launch vehicles. This plan shall define the activities
          necessary to prepare the spacecraft and associated support equipment
          for shipment, the general logistical details of the shipment itself,
          the implementation of monitoring equipment to record the environment
          of the spacecraft and critical support equipment during shipment, and
          a general definition of any support required to be provided by the
          applicable launch vehicle Contractors once the spacecraft and
          associated equipment arrive at the launch site.

8.5.2 QUARTERLY PROGRAM PROGRESS REPORTS

          The Quarterly Program Progress Report is an executive summary of the
          program status showing accomplishments against progress plan
          milestones and highlighting significant events and problems in the
          schedule. This document shall provide the

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          minimum amount of material necessary for tracking the program and
          shall be provided in a form which highlights critical changes to the
          elements defined with in this section. A structure which minimizes the
          repetition of material from quarter-to-quarter shall be used.

          For the key system budgets (noted below) and the [****] achievable
          with each launch vehicle changes from the previous report shall be
          highlighted and documented, and an action plan for correcting any
          predicted specifications non-compliance shall be presented.

          The report shall contain at least the following:

          1.   A detailed status of critical performance or schedule issues and
               of corrective actions undertaken.

          2.   General descriptions of progress accomplished during the quarter
               at unit, subsystem, and spacecraft system level.

          3.   A description of progress accomplished during the quarter by each
               major sub-contractor; and an updated list of all major
               sub-contractors.

          4.   Schedule overview, in bar chart form, showing the dates of the
               subsystem and system reviews and the dates of their delivery and
               their evolution.

          5.   Summary descriptions of any significant changes to the Contract
               in terms of design, performance, schedule or work distribution
               requirements. This shall include a status summary of Requests for
               Waiver/Deviation and Contract Change Notices.

          6.   List of milestones reached during the quarter and to date, and of
               milestones forecast to be completed for the next period.

          7.   [****] Summary containing:

                    [****]

          8.   [****] Budget containing:

                    [****] and for the spacecraft bus.

<PAGE>

***** Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

          9.   [****] Summary for the duration of the nominal mission for the
               selected launch vehicle. The estimated [****] shall also be
               defined in each case.

          10.  A review of the Product Assurance program including a summary of
               the past quarter's significant accomplishments, problems, parts
               procurement shortages, failures and solutions, program status,
               sub-contractor and supplier status, trends, and statistics.
               Additionally, the plan for the next quarter shall be summarized.

8.5.3 DESIGN REVIEW PACKAGE

          As a minimum, each review package shall include adequate pertinent
          information, supporting design and performance data and any analytical
          studies that fully describe the spacecraft various hardware subsystems
          and systems performance and capability for satisfying the performance
          requirements. All packages shall contain a [****] to the documentation
          within the package.

8.5.3.1 Spacecraft Systems Requirements Review data package

          As a minimum, the following topics/items shall be addressed in the
          Spacecraft Systems Requirements Review (SRR) data package:

          1.   Agenda with date, time and location of the design review meeting;

          2.   Program organization and management description;

          3.   Program master schedule including identification of critical path
               items, availability of facilities and resources, and any
               potential problem areas;

          4.   Summary of [****];

          5.   [****];

          6.   The satellite design analysis including a summary description of
               spacecraft and subsystems;

          7.   Performance predictions and statement of compliance to
               contractual requirements;

<PAGE>

***** Certain information on this page has been omitted and filed separately
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               a)   Satellite final specifications, including applicable
                    documents and the [****]

               b)   Subsystem preliminary specifications

          8.   Summary of [****];

          9.   [****];

          10.  [****];

          11.  [****]

          12.  [****];

          13.  [****];

          14.  [****];

          15.  [****]; and

          16.  A preliminary release of analyses and of the reliability
               evaluation.

8.5.3.2 Critical design review data package

          As a minimum, the following data shall be provided in the Critical
          Design Review data package:

          1.   Agenda with date, time, and location of the design review
               meeting;

          2.   Updates to Program organization and management description;

          3.   Final subsystem specifications

          4.   Program master schedule including identification of critical path
               items, availability of facilities and resources, and any
               potential problem areas;

          5.   Summary of [****];

          6.   Changes since SRR

          7.   Summary description of spacecraft and subsystems;

<PAGE>

***** Certain information on this page has been omitted and filed separately
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requested with respect to the omitted portions.

               [****]

          8.   Update of Performance predictions and Statement of Compliance.

          9.   Program Test Plan and supporting documentation;

          10.  [****];

          11.  [****];

          12.  Systems safety and hazard considerations:

          13.  [****];

          14.  [****]; and

          15.  Updated releases of analyses and of the reliability evaluation.

8.5.4 SPACECRAFT VALIDATION PLAN

          The Contractor shall conduct test activities as specified in Exhibit D
          to verify the compliance of the equipment with Exhibit A2. This
          document shall be maintained to be consistent with any changes to
          Exhibits A2 and D made during the program.

          .

8.5.5 SPACECRAFT STORAGE PLAN

          The Contractor shall develop an update to the XM-1/XM-2 Spacecraft
          Storage Plan for XM-4 which shall describe the equipment and methods
          used to store the spacecraft, including descriptions of storage
          containers, facilities, provisions for environmental monitoring and
          control during storage, tasks to be performed before placing the
          spacecraft in storage, tasks performed periodically during the storage
          period, and tasks to be performed when removing a spacecraft from
          storage.

          The Spacecraft Storage Plan shall cover all necessary tasks for a
          period of storage up to [****]. The Spacecraft Storage Plan shall
          clearly distinguish between tasks performed for short-term storage
          (less than [****]), and tasks performed for medium

<PAGE>

***** Certain information on this page has been omitted and filed separately
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          term storage. If testing of the spacecraft is required upon removal
          from storage, the appropriate tests shall be described.

8.5.6 SPACECRAFT SYSTEMS SUMMARY

          The Contractor shall provide an update to the XM-1/XM-2/XM-3
          Spacecraft Systems Summary for XM-4. The main objective of this
          document is to provide a top-level understanding of the spacecraft
          design, performance, and operation to XM staff not routinely
          associated with the XM Spacecraft Program Office (XMSPO), and not
          receiving the subsystem and system design review packages.

          The Spacecraft System Summary contains general descriptions of the
          spacecraft equipment and performance, overall configuration drawings,
          and functional diagrams of major assemblies and subsystems. Current
          versions of the [****] shall be presented. Each revision may be
          provided as a stand-alone document or a set of change pages, as
          mutually agreed between the Contractor and Customer.

8.5.7 [****]

          [****]

8.5.8 SPACECRAFT ASSEMBLY DRAWINGS AND CIRCUIT DIAGRAMS

          An update to the XM-1/XM-2/XM-3 set of spacecraft level assembly
          drawings and electrical circuit diagrams (from top level down to
          subsystem level) shall be provided [****]. These documents shall be
          available for reference at CDR and updates shall be made available
          when released. Unit level drawings and schematics shall be made
          available for Customer review subject to U.S. Government regulations.

          During the program, all released drawings for spacecraft produced
          under this Contract shall be available for XM review as soon as each
          drawing is released.

<PAGE>

***** Certain information on this page has been omitted and filed separately
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requested with respect to the omitted portions.

8.5.9 FLIGHT SOFTWARE/FIRMWARE DOCUMENTATION

          The Contractor's warranty of satisfactory in-orbit performance assumes
          that XM shall not modify the flight software. Documentation
          deliverables for XM specific software/flight firmware shall include
          the following:

          [****]

8.5.10 [****]

          The Contractor shall [****]. For each database, the Contractor shall
          create and maintain documentation providing detailed information on
          the structure and interpretation of the database.

8.5.10.1 [****] contents

          The [****] Database shall contain [****].

          [****].

          [****]

8.5.10.2 [****] contents

          The [****] databases shall contain [****].

8.5.10.3 Submission requirements

          The [****] databases shall be controlled by revision number and shall
          be maintained to accurately reflect the configuration of the
          spacecraft during testing and until shipment. XM shall be notified
          whenever the databases are revised.

          The [****] databases shall be released in a preliminary form at least
          [****]. Subsequently, the databases may be revised as necessary;
          however, XM shall be notified at each revision and copies shall be
          delivered electronically. The final revision effective for each
          spacecraft shall be delivered at the Shipment Readiness Review.

<PAGE>

***** Certain information on this page has been omitted and filed separately
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requested with respect to the omitted portions.

8.5.11 SPACECRAFT OPERATIONS HANDBOOK

          The Contractor shall provide a Spacecraft Operations Handbook
          specifically for XM-4. This document shall include the satellite
          operational procedures recommended by the Contractor for use by XM
          and/or Telesat in all modes of operation from end of in-orbit
          acceptance test until satellite end-of-life. This handbook shall be
          designed for inclusion of supplemental information relating to changes
          in satellite design and operation and shall include the following
          information:

          1.   [****].

          This data shall include, but shall not be limited to, the following:

8.5.11.1 [****] Control

               [****]

8.5.11.2 [****] Control

               [****].

8.5.11.3 [****]

               [****].

8.5.11.4 [****]

               [****].

8.5.11.5 [****]

               [****].

8.5.12 SPACECRAFT [****]

          A complete set of [****] shall be provided to XM. [****] to be used as
          a reference by XM and/or spacecraft operations personnel.

          [****].

<PAGE>

***** Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

8.5.12.1 [****]

               [****]

8.5.12.2 [****]

               [****].

8.5.12.3 Data Documentation and Delivery

          In general, unit data shall be provided to XM at least [****] before
          the spacecraft launch date. As a minimum, the following data shall be
          provided [****] before the launch date:

          [****]

          All other data shall be delivered to XM at least [****] prior to the
          launch of the spacecraft.

8.5.13 ANALYSIS

          Analyses reports shall include:

          1.   Statement of the objectives of the analysis and outline of the
               methodology.

          2.   Definitions of all symbols used in equations and statement of all
               assumed boundary conditions and values of constraints.

          3.   References, if appropriate, to reduce the amount of explanatory
               texts, or indication of sources of common equations, algorithms,
               etc.

          4.   Methodology and/or listing of computer analyses.

          5.   Sufficient information to allow XM to verify the adequacy and
               accuracy of the analyses.

          The reports shall be updated when new information becomes available
          during the Contract period, and shall adequately describe any
          differences.

<PAGE>

8.6      DETAILED CDRL

          The listing of data items to be submitted and their corresponding
          submittal requirements are given in Table 2, 2a, 3, and 4 attached
          hereto. Submission requirements given in days after or before an event
          shall be defined at full working days. Submission requirements given
          in weeks or months shall be defined as calendar weeks or months. All
          submission dates refer to date of receipt at the specified
          destination. Electronic submissions shall not be considered acceptable
          unless they are submitted in a format which the Customer can access
          using commercial off-the-shelf software.

8.6.1 SUBMISSION CRITERIA DEFINITIONS:

8.6.1.1 Approval

          Approval indicates that XM must provide a written indication that the
          submission is acceptable before any work which directly depends on the
          submission is begun. All deficiencies in the submission which are
          noted by XM must be resolved.

8.6.1.2 Review

          Review indicates that XM has the opportunity to review and comment on
          the submission, and Customer's reasonable comments will be
          incorporated by the Contractor. Work may proceed in parallel to the
          review activity

8.6.1.3 Information

          Information indicates that the submission is provided to aid the
          Customer in understanding.

<PAGE>

***** Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

Table 2
[****]

Table 2A
[****]

Table 3
[****]

<PAGE>

XM Satellite Radio Inc.
--------------------------------------------------------------------------------

Exhibit G-3 Rev A

--------------------------------------------------------------------------------

XM-4 Payment Plan Termination Liability Schedule, Payment Plans for In-orbit
Incentive Amounts, High Performance Incentives and Extended Life Performance
Incentives

--------------------------------------------------------------------------------
Approved by:

--------------------                                    ---------------
Joe Euteneuer                                           Date
Executive Vice President and Chief Financial Officer,
XM Satellite Radio Inc.
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
Approved by:

--------------------                                    ---------------
Lisa Dull                                               Date
Contract Manager: XM Satellite Radio
Boeing Satellite Systems International, Inc.
--------------------------------------------------------------------------------

<PAGE>

**** Certain information on this page has been omitted and filed separately with
     the Securities and Exchange Commission. Confidential treatment has been
     requested with respect to the omitted portions.

                                     [***]

<PAGE>

[LOGO] XM SATELLITE RADIO

                            XM Satellite Radio, Inc.

================================================================================

   Exhibit A2 rev 0.1

--------------------------------------------------------------------------------

XM-4 Spacecraft Performance Specifications

     Last Saved: July 30, 2003

Document Number: XM-SC-XM4001

                           DOCUMENT RELEASE APPROVALS
----------------------------------------------------
Approved by                                     Date

Derck de Bastos
Vice President, Engineering
XM Satellite Radio
====================================================
Approved by                                     Date

Terry Lamb, Program Manager
Boeing Satellite Systems
====================================================
Approved by                                     Date

Jeff Snyder, Senior Vice President, Space
and Ground Systems, XM Satellite Radio
----------------------------------------------------

<PAGE>

**** Certain information on this page has been omitted and filed separately with
     the Securities and Exchange Commission. Confidential treatment has been
     requested with respect to the omitted portions.

                                     [***]<PAGE>

                                                                   EXHIBIT 10.55

Confidential treatment has been requested for portions of this contract. The
copy filed herewith omits the information subject to the confidentiality
request. Omissions are designated as [***]. A complete version of this contract
has been filed separately with the Securities and Exchange Commission.

                                    CONTRACT

                                       FOR

                                 LAUNCH SERVICES

                                     BETWEEN

                         SEA LAUNCH LIMITED PARTNERSHIP
                       Acting through its General Partner,
                           Sea Launch Company, L.L.C.

                                       AND

                        XM SATELLITE RADIO HOLDINGS INC.

XM and Sea Launch Proprietary

<PAGE>

                                TABLE OF CONTENTS

ARTICLE 1 -- DEFINITIONS................................................4
ARTICLE 2 -- CONTRACTUAL DOCUMENTS......................................7
ARTICLE 3 -- SERVICES TO BE PROVIDED BY SEA LAUNCH......................7
ARTICLE 4 -- CONTRACT PRICE.............................................8
ARTICLE 5 -- PAYMENTS...................................................8
ARTICLE 6 -- LAUNCH SCHEDULE...........................................11
ARTICLE 7 -- LAUNCH POSTPONEMENTS AND ACELERATION......................12
ARTICLE 8 -- EXCUSABLE DELAYS..........................................14
ARTICLE 9 -- OBLIGATIONS BEFORE AND AFTER LAUNCH.......................15
ARTICLE 10 -- COMMUNICATION and COORDINATION BETWEEN SEA
                 LAUNCH and XM.........................................17
ARTICLE 11 -- PERMITS AND APPROVALS....................................18
ARTICLE 12 -- RESERVED.................................................18
ARTICLE 13 -- REPLACEMENT LAUNCH.......................................18
ARTICLE 14 -- TERMINATION..............................................19
ARTICLE 15 -- RISK ALLOCATION..........................................21
ARTICLE 16 -- PROPRIETARY DATA.........................................26
ARTICLE 17 -- RIGHTS TO INVENTIONS AND DATA............................27
ARTICLE 18 -- CHANGES..................................................28
ARTICLE 19 -- ASSIGNMENT...............................................28
ARTICLE 20 -- PUBLIC RELEASE OF INFORMATION............................28
ARTICLE 21 -- DISPUTE SETTLEMENT.......................................29
ARTICLE 22 -- APPLICABLE LAW...........................................29
ARTICLE 23 -- SEVERABILITY.............................................29
ARTICLE 24 -- WAIVERS..................................................29
ARTICLE 25 -- ENTIRE AGREEMENT.........................................29

                                       -2-

XM and Sea Launch Proprietary

<PAGE>

                          CONTRACT FOR LAUNCH SERVICES

          This Contract is made and entered into by and between Sea Launch
Limited Partnership, an exempted limited partnership organized under the laws of
the Cayman Islands acting through its General Partner, Sea Launch Company,
L.L.C., a United States limited liability company organized under the laws of
the State of Delaware (hereinafter referred to as "Sea Launch") and having
offices in Long Beach, California; and XM Satellite Radio Holdings Inc.
(hereinafter referred to as "XM" or "CUSTOMER"), and having offices at 1500
Eckington Place NE, Washington, DC 20002-2194.

                                       -3-

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<PAGE>

ARTICLE 1 -- DEFINITIONS

The terms used in the Contract shall have the meaning provided for in these
definitions:

     1.1. Business Day means any day other than the following: a Saturday,
          Sunday, and any other day on which national banks are authorized to be
          closed in New York City, New York.

     1.2. Contract means this Contract as defined in Article 2.

     1.3. Constructive Total Failure means a Constructive Total Loss due to
          performance of the Launch Vehicle.

     1.4. Constructive Total Loss shall have the meaning assigned to the term
          "Constructive Total Loss" in XM's policy of Launch and In-Orbit
          Insurance in place at the time of Launch. XM shall provide a copy of
          such definition to Sea Launch promptly after the issuance of such
          policy of Launch and In-Orbit Insurance.

     1.5. Day or day means a calendar day unless otherwise indicated.

     1.6. Effective Date means the date of last signature by an authorized
          representative of Sea Launch or XM.

     1.7. Home Port means the payload processing area and surrounding facilities
          for the loading and unloading of the Launch Vehicle and Spacecraft on
          the Assembly and Command Ship and the Launch Platform.

     1.8. Launch means the point in time when the electronic signal sent to
          command the opening of any first stage propellant valves is received
          by the Launch Vehicle, as verified by either the flow of
          propellant/oxidizer, or telemetry indicating that the signal reached
          the propellant valve. A Launch is deemed not to have occurred in the
          event of a Terminated Ignition.

     1.9. Launch and In-Orbit Insurance means insurance covering the risks of
          Launch and the risks of in-orbit failures with respect to partial
          loss, constructive total loss and total loss of the Spacecraft.

     1.10.Launch Base means the Sea Launch  marine  launch  platform  from which
          the Launch will take place,  as well as the  assembly and command ship
          from which Launch operations will be directed and monitored.

     1.11. Launch Day means the calendar day within the Launch Slot established
          for the Launch pursuant to the Contract.

     1.12. Launch Opportunity means the availability of a position in the Sea
          Launch manifest for the Launch of the Spacecraft, and is based upon
          these criteria: 1) adequate time to make the necessary preparations
          for the Launch; and 2) existing commitments to other Sea Launch
          customers.

                                       -4-

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     1.13. Launch Period means a period of time not less than ninety (90) days
          as established in Article 6 during which the Launch will occur.

     1.14. Launch Schedule means the then current Launch Period or the then
          current Launch Slot or Launch Day, if established.

     1.15. Launch Services means the services provided by Sea Launch as defined
          in Article 3.

     1.16. Launch Slot means a thirty (30) day period of time within the Launch
          Period during which the Launch will occur.

     1.17. Launch Vehicle means the expendable 6000kg launch vehicle Zenit 3SL,
          utilized by Sea Launch to perform the Launch of the Spacecraft.

     1.18. Launch Vehicle Performance means:

          1.18.1. The environmental conditions experienced by the Spacecraft as
               measured and recorded by Sea Launch via telemetry. Sea Launch
               uses the measurements to ascertain compliance with the
               environments agreed to by the Parties in the "Sea Launch to
               Spacecraft Interface Control Document (ICD)".

          1.18.2. If applicable, the functional interface between the Launch
               Vehicle and the Spacecraft as measured and recorded by Sea Launch
               via telemetry. Sea Launch uses such measurements to ascertain
               compliance with the functional interface requirements agreed to
               by the Parties in the "Sea Launch to Spacecraft Interface Control
               Document (ICD)".

          1.18.3. The Spacecraft injection orbit parameters as measured and
               recorded by Sea Launch via telemetry. Sea Launch uses the
               measurements to ascertain compliance with the injection orbit
               parameters as agreed to by the Parties in the "Sea Launch to
               Spacecraft Interface Control Document (ICD)".

     1.19 Launch Window means a specific daily time period or periods within
          each of one or more potential Launch Days during which the Launch can
          occur and meet mission requirements.

     1.20 Licensed Launch Activities means the launch of a launch vehicle as
          defined in the Commercial Space Transportation Licensing Regulations
          or the applicable license issued by the Associate Administrator for
          Commercial Space Transportation and as carried out pursuant to such
          license, and shall include all launch and pre-launch activities
          carried out pursuant to such license wherever performed (whether in
          the U.S. or elsewhere).

     1.21 Partial Failure means a Partial Loss due to performance of the Launch
          Vehicle.

     1.22 Partial Loss shall have the meaning assigned to the term "Partial
          Loss" in XM's policy of Launch and In-Orbit Insurance in place at the
          time of Launch. XM

                                       -5-

XM and Sea Launch Proprietary

<PAGE>

          shall provide a copy of such  definition to Sea Launch  promptly after
          the issuance of such policy of Launch and In-Orbit Insurance.

     1.23 Party or Parties means Sea Launch or CUSTOMER or both depending on the
          context.

     1.24 Option Launch means the ability of CUSTOMER to order from Sea Launch
          an additional Launch to be performed under the same provisions as the
          Launch Services under this Contract.

     1.25 Payload means the Spacecraft supplied by CUSTOMER to be launched on
          the Launch Vehicle.

     1.26 Postlaunch Services means the reports and range services as defined in
          the Statement of Work that are to be provided by Sea Launch to
          CUSTOMER after Launch.

     1.27 Related Third Parties means any of the following parties, but in each
          case only if such party is involved in Launch Services or Licensed
          Launch Activities:

          1.27.1 Employees, directors, officers or agents of Sea Launch,
               including its affiliates, parents or partner entities, or
               CUSTOMER;

          1.27.2 Customers of Sea Launch and the employees of those customers;

          1.27.3 Contractors and subcontractors at any tier of Sea Launch or
               CUSTOMER and the employees of those contractors and
               subcontractors; and

          1.27.4 Any party with a financial interest in Sea Launch, CUSTOMER,
               the Launch Vehicle, or the Payload.

     1.28 Spacecraft means the hardware, including any hardware supplied in
          connection with the Option Launch, supplied by CUSTOMER for Launch by
          Sea Launch pursuant to the Contract and which is compatible with the
          Launch Vehicle.

     1.29 Terminated Ignition means that, following the time when the electronic
          signal is sent to command the opening of any first stage propellant
          valves, the first stage engines of the Launch Vehicle are shut down
          for any reason before the hold down mechanism is released and the pad
          is officially declared safe by Sea Launch.

     1.30 Third Party means any individual or legal entity other than the
          Parties or Related Third Parties.

     1.31 Total Failure means a Total Loss due to performance of the Launch
          Vehicle.

                                       -6-

XM and Sea Launch Proprietary

<PAGE>

     1.32 Total Loss shall have the meaning assigned to the term "Total Loss" in
          XM's policy of Launch and In-Orbit Insurance in place at the time of
          Launch. XM shall provide a copy of such definition to Sea Launch
          promptly after the issuance of such policy of Launch and In-Orbit
          Insurance.

     1.33 Assembly and Command Ship or "ACS" means the ship which serves as the
          facility for assembly, processing and checkout of the Launch Vehicle;
          houses the Launch Control Center; acts as the base for tracking the
          initial ascent of the LV; and, provides accommodations for marine and
          launch crews.

     1.34 Launch Platform or "LP" means the marine platform from which the
          Launch is conducted.

     1.35 Interface Control Document or "ICD" means the document that defines in
          detail the needs and accommodations of the specific mission.

ARTICLE 2 -- CONTRACTUAL DOCUMENTS

     2.1  This Contract shall consist of the following documents:

          2.1.1. General Provisions, Articles 1 through 25

          2.1.2. Statement of Work (including the ICD once it is completed and
               signed by XM and Sea Launch)

     2.2  In the event of conflict, the General Provisions shall have precedence
          over the Statement of Work.

ARTICLE 3 -- SERVICES TO BE PROVIDED BY SEA LAUNCH

     3.1  Sea Launch shall provide Launch Services in accordance with the
          Statement of Work for the Launch of the XM-4 Spacecraft (and the XM-5
          Spacecraft if XM exercises its Option Launch for XM-5) provided by XM.
          Except for Postlaunch Services, Launch Services for the applicable
          Spacecraft provided under this Contract shall be deemed to have been
          completed upon Launch of such Spacecraft.

     3.2  Each of the Launch Services provided by Sea Launch under this Contract
          shall include one (1) round trip transit of the Assembly and Command
          Ship (ACS) and Launch Platform (LP) between Home Port and the Launch
          Site, except to the extent that Sea Launch requests or experiences a
          postponement pursuant to Article 7, Launch Postponements and
          Accelerations, of this Contract after the departure of the ACS and the
          LP from Home Port in which event Sea Launch will bear the additional
          costs between Home Port and the Launch Site. If after departure of
          either vessel, XM requests a postponement (other than requests by XM,
          with the concurrence of Sea Launch (not to be unreasonably withheld),
          due to any technical issues with the Launch Vehicle) that results in
          the vessels' return to Home Port, XM shall bear the additional

                                       -7-

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<PAGE>

***** Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

     costs, not to exceed [***] per such XM requested delay or postponement that
     occurs after the departure of either vessel.

ARTICLE 4 -- CONTRACT PRICE

     4.1  The Contract price is as follows:

             XM-4 Spacecraft                      [***]
             Option Launch for XM-5 Spacecraft*   [***]

          *May be exercised at XM's option no later than [***] at the price
          stated above and no later than [***] at the price stated above plus
          [***].

     4.2  Taxes

          The Launch Services price(s) set forth above include(s) all taxes,
          duties and other levies imposed on any Sea Launch furnished service or
          materials by the U. S. Government or any foreign government and/or any
          political subdivisions thereof; but exclude(s) any taxes, duties, or
          other levies that may be imposed on any XM-furnished Spacecraft or
          XM-furnished support equipment or materials. Any taxes, duties, or
          other levies imposed on any XM-furnished Spacecraft or XM-furnished
          support equipment or materials that become the obligation of Sea
          Launch to pay, will be reimbursed to Sea Launch by XM within thirty
          (30) days of the receipt of Sea Launch's request for payment.

ARTICLE 5 -- PAYMENTS

     5.1  XM shall pay the Contract price in U.S. dollars as follows:

          5.1.1 XM shall make payments of the Contract price for the XM-4
               Spacecraft Launch in [***] payments, beginning on [***], and in
               accordance with the following payment schedule:

                                XM-4 Firm Launch

                        -------------------------------
                                             Cumulative
                        Payment   Due Date    Payments
                        -------------------------------
                         [***]      [***]      [***]
                        -------------------------------
                         [***]      [***]      [***]
                        -------------------------------
                         [***]      [***]      [***]
                        -------------------------------
                         [***]      [***]      [***]
                        -------------------------------
                         [***]      [***]      [***]
                        -------------------------------

          NOTE:  For payment  purposes  under this Article 5 and for purposes of
          Paragraphs 7.4 and 14.1.2, "L" is defined as the first Business Day of
          the applicable Launch Schedule.

                                       -8-

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***** Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

          5.1.2 Right to Suspend Payments and Reselect Launch Period

               XM has the right to suspend [***] payments under the foregoing
               payment schedule by providing written notice to Sea Launch at any
               time prior to [***]. If XM exercises its right to suspend such
               payments, the payment schedule shall resume when XM notifies Sea
               Launch in writing of its new Launch Period selection, and Sea
               Launch agrees to such selection (Sea Launch agrees, where
               possible, to provide such Launch Period starting no later than
               [***] after XM provides such notice). The [***] payments will
               then be due at [***] based on the newly established Launch
               Period. During the period commencing on the date XM provides the
               suspension notice and ending on the date [***], the [***]
               remaining to be paid shall increase at the rate of [***] per
               month or partial month. Such [***] per month or partial month
               increase shall be paid by XM quarterly within [***] after receipt
               by XM of an invoice from Sea Launch. Sea Launch will send an
               invoice for this increased amount for the prior [***] on the
               first Business Day of each [***].

          5.1.3 If XM exercises the option for the Launch of the XM-5
               Spacecraft, the following payment schedule shall apply:

                                   XM-5 Option

                    -------------------
                    Payment   Increment
                      Date        %
                    -------------------
                     [***]      [***]
                    -------------------
                     [***]      [***]
                    -------------------
                     [***]      [***]
                    -------------------
                     [***]      [***]
                    -------------------
                     [***]      [***]
                    -------------------
                     [***]      [***]
                    -------------------
                     [***]      [***]
                    -------------------
                     [***]      [***]
                    -------------------
                     [***]      [***]
                    -------------------

                    *EDOE means the Effective Date of Option Exercise. The L-
                    and L+ numbers above are expressed in months.

                    [***]

     5.2  Sea Launch shall submit invoices to XM [***] in advance of the
          scheduled due date. Payment is due [***], but in no event sooner than
          the scheduled due date. If the due date for any payment falls on a day
          other than a Business Day, payment is due on the following Business
          Day.

                                       -9-

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     5.3  Payment shall be made by electronic bank transfer, free of charge to
          Sea Launch, in the amount specified in the invoice and pursuant to the
          instructions contained in the invoice. Payment shall be deemed to have
          been made when credit for the payable amount has been established in
          the payee's designated bank account.

     5.4  In the event payment has not been received by Sea Launch by the due
          date, or has been received in part only, XM shall pay Sea Launch
          interest on any unpaid amount based on [***]. No later than [***], all
          payments then due and owing, including any interest thereon, must be
          made to Sea Launch.

     5.5. In the event of postponement requested by Sea Launch pursuant to
          Paragraph 7.2 of Article 7, Launch Postponement, or any postponement
          due to an excusable delay as defined in Article 8 Excusable Delays,
          the payments shall be suspended for the duration of the delay and then
          resumed with all remaining payments shifted by the amount of the delay
          to be consistent with the revised Launch Schedule. In the event of
          postponement requested by XM pursuant to Paragraph 7.1 of Article 7,
          Launch Postponements, excluding any postponement due to an excusable
          delay, the payments must continue according to the then current
          payment schedule.

     5.6  In the event that one Party has not paid the second Party any amount
          that is due and payable to the second Party under this Contract, such
          second Party shall have the right to set off such amount against any
          payment(s) due and payable or to become due and payable to the first
          Party, provided, however, any amount being disputed under Article 21
          of this Contract shall not be considered due and payable until the
          dispute is finally resolved.

     5.7  No payment made under this Contract shall relieve Sea Launch of any of
          its obligations under this Contract.

                                      -10-

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requested with respect to the omitted portions.

ARTICLE 6 -- LAUNCH SCHEDULE

6.1 The Launch of the Spacecraft shall take place during the following Launch
Period(s):

          Launch                Launch Period
          ------                -------------

           XM-4                     [***]

           XM-5                     [***]

6.2  The Launch Slot shall be determined by mutual agreement of the Parties at
     least [***] prior to the first day of the established Launch Period based
     on the availability of Launch Opportunities. Sea Launch shall submit a
     proposed Launch Slot to XM at least [***] prior to the first day of the
     established Launch Period.

6.3  The Launch Day shall be determined by mutual agreement of the Parties at
     least [***] prior to the first day of the Launch Slot based on the
     availability of Launch Opportunities. Sea Launch shall submit a proposed
     Launch Day to XM at least [***] prior to the first day of the Launch Slot.
     Upon commitment to a Launch Day, XM agrees to deliver the spacecraft to Sea
     Launch's Home Port no earlier than [***] prior to the Launch Date and no
     later than [***] prior to the Launch Date.

6.4  The Launch Window shall be determined by mutual agreement of the Parties no
     later than [***] prior to the Launch Day based on the availability of
     Launch Opportunities.

6.5  XM shall notify Sea Launch at least [***] prior to delivery of the
     Spacecraft to either Home Port or in the instance of foreign Spacecraft
     manufacture to a local airport.

6.6  The following rules shall govern the establishment of Launch Schedule
     priorities between Sea Launch, XM, and other customers of Sea Launch,
     excluding any commitments or obligations by Sea Launch prior to the
     Effective Date of this Agreement:

     6.6.1. In the event of a Sea Launch delay or postponement, for any reason,
          the launching order remains in effect as of the date of Sea Launch's
          delay or postponement, 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 its position in the launching order and shall be
               treated as a standard launch service for any subsequent Sea
               Launch postponement.

                                      -11-
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     6.6.2. In the event of a scheduling conflict during the initial scheduling
          of a Launch Period or Launch Slot due to overlapping Launch Periods
          between two or more customers, the Sea Launch customer with the
          earlier Contract effectivity date (i.e. contract award date or option
          exercise date) shall have precedence.

     6.6.3. In the event of a scheduling conflict during the scheduling of a
          Launch Period or Launch Slot due to a postponement by XM or any other
          Sea Launch customer, the Sea Launch customer (i.e. XM or the other
          customer) initially scheduled for the Launch Period or Launch Slot
          shall have precedence.

ARTICLE 7 -- LAUNCH POSTPONEMENTS AND ACCELERATION

7.1  Postponements requested by XM

     7.1.1 Prior to the departure of the LP from Home Port to the launch site,
          XM may request a change to the Launch Schedule for any reason by
          providing written notice of any desired change. XM must request a
          change as soon as XM knows that XM will not maintain the current
          Launch Schedule. At the time of the request for a change, XM will
          propose a new Launch Schedule that XM is ready and able to maintain.
          Within [***] of the receipt of the written request of a Launch
          Schedule change, Sea Launch will inform XM if a Launch Opportunity is
          available as requested or will propose an alternative Launch Schedule
          as close as possible to the Launch Schedule requested by XM. If an
          alternative Launch Schedule is proposed by Sea Launch, XM will respond
          within [***] by accepting the alternative Launch Schedule proposed by
          Sea Launch or will propose another Launch Schedule.

     7.1.2 Once the LP has departed Home Port for the launch site, any
          postponement requested by XM (other than requests by XM, with the
          concurrence of Sea Launch (not to be unreasonably withheld) due to any
          technical issues with the Launch Vehicle) which results in a delay of
          the Launch and a return of the vessel(s) to Home Port shall result in
          additional Sea Launch incurred costs and expenses which additional
          costs and expenses shall be paid in full by XM within [***] of the
          invoice (such amount not to exceed [***]).

                                      -12-
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     7.1.3 In the event that a single postponement or cumulative postponements
          exceed [***] for a Launch, the exclusive right and remedy of Sea
          Launch shall be repricing of the Launch Services for the postponed
          Launch in accordance with the following sentence. For any such
          postponements that exceed [***], the price of the Launch Services for
          the postponed Launch shall increase by [***] of the original price per
          month or partial month exceeding such [***] postponement. The price
          increase shall be paid [***] within [***] after receipt by XM of the
          invoice from Sea Launch. Sea Launch will send an invoice for this
          increased amount for the prior [***] on the first Business Day of each
          [***].

7.2  Postponements requested by Sea Launch

     7.2.1 Sea Launch may request a change to the Launch Schedule in the event
          that a Launch Opportunity does not exist within the current Launch
          Schedule (but only if it is due to excusable delay, technical
          problems, or the launch schedule priorities set forth in Paragraph
          6.6). Sea Launch will provide written notice of any desired change as
          soon as Sea Launch knows that a Launch Opportunity will not be
          available. Sea Launch will propose a new Launch Schedule at the time
          of the request for a change. Within [***] of the receipt of the
          written request of a Launch Schedule change, XM will either accept the
          alternative Launch Schedule proposed by Sea Launch or will propose
          another Launch Schedule.

     7.2.2 Postponements by Sea Launch under this Article shall not exceed a
          total of [***] for any Launch. In the event that a single postponement
          or cumulative postponements exceed [***] for a Launch or are
          reasonably certain to exceed [***], the exclusive right and remedy of
          XM shall be either renegotiation of the Contract, including price and
          terms, or termination in accordance with Paragraph 14.1.3 of Article
          14, Termination. If the Parties do not agree that the postponements
          are reasonably certain to exceed [***], the disagreement will be
          resolved in accordance with Article 21, Dispute Settlement.

     7.2.3 If XM believes it is reasonably certain that Sea Launch will postpone
          the Launch in excess of [***], XM may provide Sea Launch with written
          notice requesting a work-around plan and schedules verifying that the
          launch schedule will not be postponed beyond [***]. If [***] after XM
          provides such notice it is still reasonably certain that Sea Launch
          will postpone the Launch in excess of [***], then XM may terminate the
          Launch in accordance with Paragraph 14.1.3 of Article 14. Any dispute
          arising regarding whether a postponement of [***] is reasonably
          certain shall be resolved in accordance with Article 21, Dispute
          Settlement.

7.3  The length of a postponement under this Article is measured from the first
     day of the then current Launch Schedule to the first day of the Launch
     Schedule proposed in conjunction with the initial request for a change.
     Days during which an excusable delay exists as defined in Article 8,
     Excusable Delays, and which affect the Launch Schedule of the postponed
     launch, are not included in determining the

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     length of a postponement under this Article. Sea Launch agrees that XM's
     Launch is not required to be the return to flight launch in the event of
     any Sea Launch launch failure. The passage of time resulting from XM
     exercising this right shall not be considered a postponement by XM. In
     addition, any postponements necessary for XM to ensure that the Launch and
     In-Orbit Insurance policy is fully effective following any postponement
     (including any that results in a return to Home Port) will not be included
     in determining the length of any XM postponement under this Article.

7.4  Acceleration requested by XM

     For the launch of XM-4, XM may, at any time prior to [***], provide a
     written request to Sea Launch for acceleration of the Launch Period or Slot
     to a date which XM will designate. As quickly as possible, and at the
     latest within [***] following receipt of an acceleration request, Sea
     Launch will inform XM in writing if there is a Launch Opportunity within
     the requested period and Sea Launch will make every effort to allocate XM
     the Launch Opportunity nearest to the date requested by XM. Sea Launch is
     not required to force any other customer to delay or alter its launch
     schedule as a result of XM's acceleration request. XM and Sea Launch shall
     agree on the cost impact, if any, of acceleration prior to finalizing the
     new Launch Period or Slot. The payment schedule will be adjusted to reflect
     any acceleration in the Launch Schedule.

     For the launch of XM-5, XM may request an acceleration of the proposed
     initial Launch Period, Sea Launch will review the existing manifest and
     will accommodate XM's request on a priority basis consistent with the
     manifest guidelines and the preceding paragraph in this Paragraph 7.4.

ARTICLE 8 -- EXCUSABLE DELAYS

8.1  Neither Sea Launch nor XM shall be liable to the other in the event of a
     delay in the performance of its obligations or commitments, and the date on
     which those obligations are to be fulfilled shall be extended for a period
     of time as caused by the delay, when the delay is due to causes beyond the
     control of Sea Launch or XM as the case may be, and not due to their fault
     or negligence in reasonably anticipating and avoiding such delays and not
     due to a breach of any provision of this Contract. Such excusable delays
     also include the excusable delays of contractors and subcontractors when
     the item or services provided by the contractor or subcontractor cannot be
     reasonably obtained from another source. Such excusable delays shall
     include, but not be limited to: acts of God; fires; interruptions of
     essential services such as electricity, natural gas, fuels and water;
     adverse weather or launch safety conditions that do not permit Launch, any
     condition which jeopardizes the safety of the employees of Sea Launch or XM
     or their subcontractors; acts (including delay or failure to act) of any
     governmental authority (de jure or de facto), embargoes, strikes or labor
     stoppages (other than, in the case of Sea Launch, by Sea Launch or its
     partner companies (i.e., Boeing Commercial Space Company, RSC Energia, SDO
     Yushnoye, P.O. Yuzhmash, and Kvaerner Sea Launch Limited) (provided,
     however, that no Boeing Company entity that does not provide services or
     hardware comprising any part of the launch

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     services described in the Statement of Work (e.g., Boeing Satellite Systems
     International, Inc.) shall be deemed a partner company of Sea Launch for
     purposes of this Paragraph 8.1) or any entities controlled by Sea Launch or
     its partner companies that provide services or hardware related to the
     performance of this Contract); wars; riots; revolutions, and hijacking.
     Notwithstanding the foregoing, in no event will financial hardship or
     insolvency of a Party or any of its contractors or subcontractors
     constitute an excusable delay. In addition, for the avoidance of any doubt,
     in the case of Sea Launch, any delays caused by a launch failure shall not
     constitute an excusable delay. The Party impacted by an excusable delay
     shall provide written notice to the other Party within ten (10) Business
     Days after the performance of the Party claiming the excusable delay has
     been impacted by the occurrence of any such excusable delay. Any such
     notice shall contain an assessment of the impact on the Launch Schedule and
     the plans of the delayed Party for mitigating the impact of the excusable
     delay. In the case of Sea Launch, such notice shall include a detailed
     description of the portion of the Launch Services known to be affected by
     such excusable delay. In coordination with XM, Sea Launch shall use best
     reasonable efforts to avoid or minimize and/or work around such delay
     through the implementation of any work-around plans, alternate sources, or
     other means Sea Launch may reasonably utilize to minimize a delay in
     performance of the Launch Services. A Party claiming an excusable delay
     shall provide the other Party prompt written notice when the event
     constituting the excusable delay appears to have ended.

8.2  The inability of Sea Launch to perform due to any export control
     restrictions or delays caused by or arising from assignment of this
     Contract in whole or in part by XM pursuant to Article 19 shall be
     conclusively presumed to be an excusable delay event.

ARTICLE 9 -- OBLIGATIONS BEFORE AND AFTER LAUNCH

9.1  Sea Launch shall provide to XM and XM shall provide to Sea Launch the data,
     hardware and services as identified in the Statement of Work according to
     the schedules provided therein. The data, hardware and services will be
     received in a condition suitable for their intended use as defined by the
     requirements of the Statement of Work. In the event that the data, hardware
     or services are not received according to their schedule or requirements,
     and the non-availability will affect the Launch Schedule, the following
     procedure shall apply.

9.2  The Party receiving or failing to receive the data, hardware or services
     shall promptly notify the other Party including a statement of the
     discrepancy and recommended solutions. The Party receiving the notification
     shall provide written direction to the other Party on how to proceed,
     considering the recommendations of the other Party, within seven (7) days
     of the receipt of notice.

9.3  The Party receiving or failing to receive the data, hardware or services
     shall use its best efforts to continue its obligations under the Contract
     without affecting the Launch Schedule. If, however, this is not possible
     despite the best efforts of the receiving Party; and the Launch Schedule is
     affected as a result of the failure of one Party to deliver the data,
     hardware or services in accordance with the

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     schedule or requirements of the Statement of Work; then a launch
     postponement shall be declared by the receiving Party and such delay shall
     be considered a delay under the appropriate provisions of Article 7, by the
     Party providing or failing to provide the data, hardware or services.

9.4  Nothing in this Paragraph 9.4 will be construed as a warranty or as
     contradicting the provisions of Paragraph 15.1. At mission readiness review
     and at launch readiness review, Sea Launch shall (1) certify in writing
     that, to the best of its knowledge and belief, the Launch Vehicle fully
     conforms to the SOW requirements and no defects, failures, anomalies, or
     out of specification conditions exist, other than as specified in such
     certification; and (2) confirm in writing that any known defects, failures,
     anomalies, or out of specification conditions in any Sea Launch
     manufactured launch vehicle that may be applicable to the Launch Vehicle
     have been corrected on the Launch Vehicle, other than as specified in such
     certification. Prior to Launch, Sea Launch shall correct any known defects,
     failures, anomalies, or out of specification conditions promptly and at no
     additional cost or expense to XM, unless waived by XM in writing. Prior to
     Launch, Sea Launch will provide a certification that all known defects,
     failures, anomalies or out of specification conditions applicable to the
     Launch Vehicle have either been corrected by Sea Launch or waived in
     writing by XM.

9.5  The Parties recognize that Sea Launch has no ability to alter the
     performance or in any way to correct any defect in the Launch Vehicle after
     Launch. An agreement by XM to conduct the Launch, given at the final launch
     readiness review, shall constitute a waiver by XM of any claim that the
     Launch Vehicle or Launch Services do not meet the requirements of the
     Statement of Work, or that the Launch Vehicle or Launch Services are not
     otherwise suitable for their intended purpose. Except for Postlaunch
     Services, the sole liability or obligation of Sea Launch for performance
     subsequent to Launch is to provide a replacement launch in accordance with
     Article 13, Replacement Launch. This Waiver of claims excludes claims
     related to fraud, willful misrepresentations, gross negligence or willful
     misconduct on the part of Sea Launch or XM.

9.6  Sea Launch shall promptly provide XM with written notification of any
     design, manufacture, performance or in-flight anomaly or failure of any of
     its launch vehicles occurring after the date of this Contract, including
     any corrective actions to be taken to prevent the reoccurrence of such
     anomaly or failure in future launch vehicles.

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ARTICLE 10 -- COMMUNICATION and COORDINATION BETWEEN SEA LAUNCH and XM

10.1 All notices and communications between the Parties relating to financial,
     contractual or administrative matters of the Contract that are required or
     permitted under the Contract, in order to be given effect, shall be in
     writing and shall be addressed and received by the recipient as listed
     below.

Notices to Sea Launch:   Sea Launch Company, L.L.C.
                         One World Trade Center
                         Suite 950
                         Long Beach, California 90831-0950
                         Attention:   Cynthia M. Childs
                                      Director, Project Development
                                      Phone: (562) 499-4714
                                      Fax: (562) 499-4755

Notices to XM:           XM Satellite Radio
                         1500 Eckington Place NE
                         Washington, DC 20002-2194
                         Attention:   Joseph M. Titlebaum, Exec. Vice President,
                                      General Counsel and Secretary
                                      Fax: (202) 380-4539

                         With an additional copy to:

                         Attention:   Jeff Snyder, Sr. Vice President,
                                      Space and Ground Systems
                                      Fax: (202) 380-4546

10.2 Sea Launch and XM each shall designate a Mission Manager no later than
     [***] after the effective date of the Contract. The task of the Mission
     Managers shall be to supervise and coordinate the respective
     responsibilities of the Parties. The Mission Managers are not authorized to
     direct work contrary to the requirements of the Contract or to make
     modifications to the Contract. Each Party may replace its Mission Manager
     provided the other Party has received notification in writing of such
     action.

10.3 All documentation, notices, reports and correspondence under the Contract
     shall be submitted and maintained in the English language. All
     communication at the Home Port and Launch Base between the Parties and with
     Related Third Parties and between the personnel of the Parties or Related
     Third Parties shall be in English. The Parties shall mutually agree upon
     standards for transliteration and translation of non-English information.

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ARTICLE 11 -- PERMITS AND APPROVALS

11.1 Each Party is responsible for obtaining all necessary licenses, permits,
     approvals, and authorizations to perform its respective obligations under
     the Contract. Each Party agrees to assist and support the other Party to
     the extent practicable, in obtaining such licenses, permits, approvals, and
     authorizations.

ARTICLE 12 -- RESERVED

ARTICLE 13 -- REPLACEMENT LAUNCH

13.1 XM may request a replacement launch in the event of a Total Loss,
     Constructive Total Loss or Partial Loss.

13.2 The request for a replacement launch must be in writing and received by Sea
     Launch no later than [***] after the determination of a Total Loss,
     Constructive Total Loss or Partial Loss. The request shall indicate the
     Launch Period desired for the replacement launch.

13.3 Sea Launch shall inform XM, after receipt of the request, if a Launch
     Opportunity exists as requested. If a Launch Opportunity does not exist as
     requested, the Parties will negotiate in good faith a mutually acceptable
     Launch Period.

13.4 Any agreement reached by the Parties on a replacement launch shall be in
     writing. The replacement launch shall be provided in accordance with the
     terms and conditions of the Contract.

13.5 The configuration and mission requirements of the Spacecraft selected by XM
     for the replacement launch shall be sufficiently similar to avoid any need
     for mission analysis or for Launch Vehicle or interface changes.

13.6 XM shall pay Sea Launch [***] for the replacement launch [***], subject to
     [***] of the Launch Period agreed upon by the Parties in accordance with
     Paragraph 13.3.

13.7 XM shall make payment for the replacement launch in accordance with the
     payment schedule set forth in Article 5, Payments. XM shall make the
     initial payment at the time of the written agreement on the Launch Period
     of the replacement launch in accordance with Paragraph 13.3. The initial
     payment shall include all past due sums.

13.8 The remedies set forth in this Article 13, Replacement Launch, shall
     constitute the sole and exclusive remedies of XM for Total Failure,
     Constructive Total Failure, or Partial Failure except in the event of acts
     of fraud, willful misrepresentations, gross negligence or willful
     misconduct on the part of Sea Launch.

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ARTICLE 14 -- TERMINATION

14.1 Termination by XM

     14.1.1 The rights of XM to terminate the Contract or any Launch under the
          Contract, and the available remedies, are limited to the following:

     14.1.2 Prior to Launch, XM may terminate the Contract or any Launch under
          the Contract for XM's convenience for any reason. Sea Launch will be
          entitled to retain, as a termination charge, and not as a penalty, the
          amount specified in the following table as of the date of the
          termination of the applicable Launch(es). Within [***] of the date of
          the termination, Sea Launch will refund the balance of all payments
          made for the Launch terminated in excess of the termination charge.

                              Termination Liability

           ---------------------------------------------------------------------
                                          Termination Liability as a percentage
                                         of the applicable Launch Services Price
           Date of Customer Termination         as adjusted by Escalation
           ---------------------------------------------------------------------
                       [***]                             [***]
           ---------------------------------------------------------------------
                       [***]                             [***]
           ---------------------------------------------------------------------
                       [***]                             [***]
           ---------------------------------------------------------------------

     14.1.3 If XM elects to terminate for excessive delay under Article 7, Sea
          Launch will return all payments made by XM for the Launch terminated.
          Only the Launch delayed or postponed may be terminated under this
          paragraph. The right of XM to terminate under this paragraph is
          conditioned upon (i) receipt of a written notification of a launch
          postponement or cumulative postponements exceeding [***], or (ii) upon
          the occurrence of a launch delay or delays by Sea Launch which exceed
          [***] or (iii) upon the occurrence of a delay or delays by Sea Launch
          that are reasonably certain to exceed [***], but in the case of this
          clause (iii), only if such reasonable certainty continues after the XM
          notification and the passage of the [***] period provided in Paragraph
          7.2.3. XM must terminate no later than [***] after the first of the
          two events above or must waive its right to terminate under this
          paragraph unless further delayed by Sea Launch.

     14.1.4 If the Sea Launch launch immediately preceding the scheduled Launch
          of a Spacecraft is a launch failure, XM may, by written notice to Sea
          Launch sent no sooner than [***] and no later than [***] after such
          launch failure, elect to terminate the Launch Services under this
          Contract and Sea Launch will return all payments made by XM for such
          Launch Services, except for [***].

     14.1.5 If the launch Sea Launch is providing with respect to the XM-3
          spacecraft is a launch failure, XM may, by written notice to Sea
          Launch sent no sooner

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          than [***] and no later than [***] after such launch failure, elect to
          terminate the Launch Services for the XM-4 Spacecraft, in which case
          all of the payments made to Sea Launch with respect to such XM-4
          Spacecraft Launch Services shall be applied to the XM-5 Spacecraft
          Launch Services. If the option for XM-5 Spacecraft Launch Services had
          not yet been exercised, then the option shall be deemed exercised and
          it shall be incorporated in a mutually agreed XM-5 Launch Services
          amendment with the applicable Launch Period approved by XM. The
          payment schedule and other terms applicable to the XM-5 Spacecraft
          Launch Services shall apply after the exercise by XM of the special
          right provided in this Paragraph 14.1.5.

     14.1.6 If cumulative postponements by Sea Launch, including the period of
          any postponements during excusable delay(s) asserted by Sea Launch,
          exceed a total of [***] for any Launch, then XM shall have the right
          to terminate the Launch so postponed and Sea Launch will return all
          payments made by XM for the Launch so terminated.

     14.1.7 If XM brings any claim for material breach prior to Launch, other
          than for a Launch Schedule delay and other than a claim based on
          fraud, willful misrepresentation, gross negligence or willful
          misconduct (in which case XM will have all of its rights and remedies
          under applicable law), the exclusive remedy of XM shall be termination
          of the Contract and refund of an amount up to the total of all
          payments made for every Launch subject to termination.

     14.1.8 The exclusive rights and remedies of XM subsequent to Launch are
          limited to a replacement launch in accordance with Article 13,
          Replacement Launch. This limitation does not apply to claims based on
          fraud, willful misrepresentation, gross negligence or willful
          misconduct (in which case XM will have all of its rights and remedies
          under applicable law).

14.2 Termination by Sea Launch

     14.2.1 The rights of Sea Launch to terminate the Contract or any Launch
          under the Contract, and the available remedies, are limited to the
          following:

          Sea Launch may terminate the Contract in the event that XM fails to
          comply with the payment obligations specified in Article 5, Payments.
          In no event shall the effective date of termination by Sea Launch
          under this Paragraph be earlier than [***] after the due date of any
          payment not made. In the case of a multi-launch agreement, only the
          Launch for which payments are delinquent may be terminated under this
          Paragraph. In the event of such termination, Sea Launch shall retain,
          as a termination charge, all payments due under Article 5, Payments,
          for the Launch terminated, as of the effective date of termination.
          This limitation does not apply to claims based on fraud, willful
          misrepresentation, gross negligence or willful misconduct (in which
          case Sea Launch will have all of its rights and remedies under
          applicable law).

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14.3 Any termination for default or breach under this Article must be preceded
     by [***] written notification that specifies the default or breach and the
     intent to terminate in the event that the default or breach is not or
     cannot be cured within [***] of such notice.

14.4 Both XM and Sea Launch agree that the payments specified in this Article
     represent fair compensation for either Party, and shall constitute the
     exclusive rights and remedies available to the Parties in the event of
     termination by either Party. This limitation does not apply to claims based
     on fraud, willful misrepresentation, gross negligence or willful
     misconduct.

ARTICLE 15 -- RISK ALLOCATION

The Parties expressly acknowledge and agree that the liabilities of SEA LAUNCH
and/or of XM, resulting from the non execution or late execution of the services
provided by SEA LAUNCH, and of the technical commitments of XM, are strictly
limited to the provisions of this Contract, excluding any other liabilities or
claims.

15.1 Warranty

     15.1.1 Warranty Disclaimer. SEA LAUNCH makes no warranty, express or
          implied, with respect to the Launch or any services provided to or on
          behalf of XM. Nothing in this Contract shall be construed as an
          express or an implied warranty. XM acknowledges that it has read and
          understands this Article and the exclusion of all warranties has been
          bargained for in this Contract.

     15.1.2 Limitation of Liability. In no event shall either Party be liable to
          the other Party under or in connection with this Contract under any
          legal or equitable theory, including negligence, for direct, indirect,
          special, consequential, or incidental damages, or indemnities, except
          as expressly provided in this Contract. Consistent with this
          limitation of liability, each Party shall use commercially reasonable
          efforts to ensure that its insurer(s) waive all rights of subrogation
          against the other Party. This limitation does not apply to claims
          based on fraud, willful misrepresentation, gross negligence or willful
          misconduct.

15.2 Licensed Launch Activities

     15.2.1 Third Party Liability Insurance (Licensed Launch Activities)

          15.2.1.1 SEA LAUNCH shall obtain and maintain in effect a policy of
               liability insurance that protects XM and its Related Third
               Parties against claims by a Third Party for bodily injury or
               property damage resulting from Licensed Launch Activities
               performed under this Contract. Such insurance shall be in the
               amounts of [***], before Launch and [***] after Launch, or such
               other amounts, if higher, determined by the Associate
               Administrator of Commercial Space Transportation (the "AST").

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          15.2.1.2 Such insurance shall remain in effect from commencement of
               Licensed Launch Activities until one year after Launch.

          15.2.1.3 The Third Party liability insurance obtained pursuant to this
               Article shall not cover loss of or damage to the Spacecraft even
               if the claim is brought by a Third Party or Related Third Party.

     15.2.2 Indemnification by the United States Government (Licensed Launch
          Activities).

          15.2.2.1 Subject to the conditions of the Commercial Space Launch Act
               (49 U.S.C. (s)(s) 70101-70121), the United States Government
               shall pay claims by a Third Party against SEA LAUNCH, XM or their
               Related Third Parties for bodily injury or property damage
               resulting from Licensed Launch Activities, but only to the extent
               that the aggregate of such claims arising out of any particular
               Launch is (i) in excess of the amount of insurance required under
               paragraph 15.2.1.1 above and (ii) not in excess of $1,500,000,000
               (plus any additional sums necessary to reflect inflation
               occurring after January 1, 1989).

          15.2.2.2 Upon expiration of the insurance policy prescribed under
               paragraph 15.2.1.1 above, the United States Government shall,
               subject to the conditions of the Commercial Space Launch Act,
               provide for payment of claims by a Third Party against SEA
               LAUNCH, XM or their Related Third Parties for bodily injury or
               property damage resulting from Licensed Launch Activities from
               the first dollar of loss up to $1,500,000,000 (plus any
               additional sums necessary to reflect inflation occurring after
               January 1, 1989).

          15.2.2.3 SEA LAUNCH makes no representation nor provides any warranty
               that payment of claims by the United States Government will be
               made pursuant to the Commercial Space Launch Act or otherwise.
               The sole obligation of SEA LAUNCH is to make a good faith effort
               to obtain such payment from the United States Government.

     15.2.3 Reciprocal Waiver and Release of Claims (Licensed Launch
          Activities).

          15.2.3.1 Each Party agrees to execute and submit to the AST, at least
               forty (40) days prior to commencement of Licensed Launch
               Activities under this Contract, the Agreement for Waiver of
               Claims and Assumption of Responsibility substantially in the form
               set forth at Appendix B to Part 440 in Title 14 of the Code of
               Federal Regulations. Such Agreement is binding upon XM, SEA
               LAUNCH

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               and the U.S. Government only with respect to Licensed Launch
               Activities performed under this Contract.

          15.2.3.2 Each Party shall implement the reciprocal waiver of claims
               provisions provided in paragraph 15.2.3.1 with its Related Third
               Parties (other than employees, officers or directors) requiring
               them to waive and release all claims of liability they may have
               against the other Party and its Related Third Parties.

15.3 Activities other than Licensed Launch Activities

     15.3.1 Third Party Liability (other than Licensed Launch Activities) Each
          Party agrees to indemnify, defend and hold harmless the other Party
          from and against any and all claims of a Third Party (other than
          claims by employees, officers or directors of a Party or of its
          Related Third Parties) for bodily injury or property damage to the
          extent that it is caused by the indemnifying Party or its Related
          Third Parties (other than Boeing Satellite Systems International, Inc.
          in the case of XM) while performing activities related to this
          Contract other than Licensed Launch Activities. Each Party shall
          maintain insurance with limits sufficient to cover the aforementioned
          indemnification obligation and shall use commercially reasonable
          efforts to ensure that its insurer(s) waive all rights of subrogation
          against the other Party to the extent the indemnifying Party has
          waived its rights of recovery against the indemnified Party.

     15.3.2 Reciprocal Waiver and Release of Claims (other than Licensed Launch
          Activities)

     15.3.2.1 XM and Sea Launch agree to a reciprocal waiver of claims pursuant
          to which each Party agrees to be responsible for and to absorb the
          financial and any other consequences of any property damage or loss it
          sustains or any bodily injury to, death of, or property damage or loss
          sustained by its own employees arising out of or relating to any
          activities carried out under this Contract other than Licensed Launch
          Activities. Neither Party will make any claim or institute any
          arbitration or judicial proceedings against the other Party or its
          Related Third Parties for such damage, loss, injury or death. This
          waiver will not be applicable to the extent that the damage, loss,
          injury or death sustained by a Party or its employees is caused by the
          gross negligence or intentional misconduct of the other Party or its
          Related Third Parties.

     15.3.2.2 Each Party further agrees to require its Related Third Parties
          (other than employees, officers or directors) to be responsible for
          and to make no claims against the other Party or its Related Third
          Parties for any property damage or loss they sustained or for any
          bodily injury to, death of, or property damage or loss sustained by
          their own employees arising out of or relating to any activities
          carried out under this Contract other than Licensed Launch Activities.
          The waiver required by this Paragraph

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          15.3.2.2 will not be applicable to the extent that the damage, loss,
          injury or death sustained by a Related Third Party is caused by the
          gross negligence or intentional misconduct of the other Party or its
          Related Third Parties.

     15.3.2.3 If any of a Party's Related Third Parties makes a claim or
          institutes any arbitration or judicial proceeding (other than claims
          for gross negligence or intentional misconduct which are not subject
          to this waiver) against the other Party or its Related Third Parties
          for damage, loss, injury or death to the extent required to be waived
          in Paragraph 15.2.3.2 or Paragraph 15.3.2.2, the first Party shall
          indemnify, hold harmless and defend the other Party and its Related
          Third Parties from and against any liability on account of such
          damage, loss, injury or death, and shall pay all expenses and satisfy
          all awards and judgments which may be incurred by or rendered against
          said indemnitee(s).

15.4 Spacecraft

     XM assumes the risk of any actual or constructive loss of or damage to the
     Spacecraft prior to, during, and after Launch, including any loss or damage
     resulting from the non-availability of or inability to use the Spacecraft
     following Launch. XM shall indemnify, defend, and hold harmless Sea Launch
     and its Related Third Parties (other than Boeing Satellite Systems
     International, Inc.) against all claims and actions based in whole or in
     part on loss or damage to the Spacecraft, including loss or damage
     resulting from the non-availability of or inability to use the Spacecraft.
     This assumption of risk and indemnification shall not apply to the extent
     that the loss or damage is caused by the gross negligence or intentional
     misconduct of Sea Launch or its Related Third Parties. XM shall use
     commercially reasonable efforts to ensure that its insurers waive all
     rights of subrogation against Sea Launch and its Related Third Parties.

15.5 Indemnification- Intellectual Property Infringement

     15.5.1 Sea Launch agrees to defend, hold harmless and indemnify XM and its
          Related Third Parties from and against any liabilities, costs, risks,
          losses, damages, or injury, or any consequences thereof, resulting
          from an infringement or claim for infringement of the patent right or
          any other intellectual property right of a Third Party or a Related
          Third Party of Sea Launch which may arise from the provisions of the
          Launch Services or Postlaunch Services under this Agreement by Sea
          Launch.

     15.5.2 XM agrees to defend, hold harmless and indemnify Sea Launch and its
          Related Third Parties (other than Boeing Satellite Systems
          International, Inc.) from and against any liabilities, costs, risks,
          losses, damages, or injury, or any consequences thereof, resulting
          from an infringement or claim for infringement of the patent right or
          any other intellectual property rights of a Third Party or a Related
          Third Party of XM which may arise from the design and manufacture of
          the Spacecraft.

15.6 Notice and Cooperation

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XM and Sea Launch Proprietary

<PAGE>

     Sea Launch shall provide customary and normal support to assist XM in
     obtaining Launch and In-Orbit Insurance, including (i) supporting XM with
     all necessary presentations (oral, written or otherwise), including
     attendance and participation in such presentations where requested by XM,
     (ii) providing on a timely basis all reasonable and appropriate technical
     information, data and documentation, and (iii) providing documentation and
     answers to insurer and underwriter inquiries. In addition, Sea Launch shall
     provide any other certifications, confirmations or other information with
     respect to the Launch Vehicle as reasonably required by XM's Launch and
     In-Orbit Insurance insurers and underwriters and shall take any other
     action reasonably requested by XM or any such insurers or underwriters that
     is necessary or advisable in order for XM to obtain and maintain Launch and
     In-Orbit Insurance on reasonable and customary terms.

     Each Party agrees to cooperate with the other Party in obtaining relevant
     reports and other information in connection with the presentation by either
     Party of any claim under insurance required by this Article. A Party
     seeking indemnification under this Article shall (i) promptly advise the
     indemnitor of any damage or injury incurred, or the filing of any suit or
     any written or oral claim against it; (ii) provide the indemnitor with
     copies of all relevant documentation and (iii) cooperate with the
     indemnitor and its insurers in every reasonable manner in making or
     defending against such claim. A Party seeking indemnification shall not
     make any admission nor shall it reach a compromise or settlement without
     the prior written approval of the indemnitor.

     Sea Launch shall cooperate with and provide reasonable support to XM in
     making and perfecting claims for insurance recovery and as to any legal
     proceeding associated with any claim for insurance recovery. Such support
     shall include (i) providing on-site inspections as required by XM's
     insurers and underwriters, (ii) participating in review sessions with a
     competent representative selected by the insurers and underwriters to
     discuss any continuing issue relating to such occurrence, including
     information conveyed to either Party, (iii) using its best efforts to
     secure access for the insurers and underwriters to all information used in
     or resulting from any investigation or review of the cause or effects of
     such occurrence, (iv) making available for inspection and copying all
     information reasonably available to Sea Launch that is necessary to
     establish the basis of a claim, and (v) supporting XM in establishing the
     basis of any Total Loss, Constructive Total Loss or Partial Loss.

     The cooperation and support provided for in this Paragraph 15.6 is included
     within the firm fixed price of this Contract.

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XM and Sea Launch Proprietary

<PAGE>

15.7 Evidence of Insurance

     For any of the insurance policies required under this Contract, each Party
     shall provide the other Party with a certificate evidencing such insurance
     within 30 days of a written request by the other Party and require its
     insurer(s) to provide the other Party written notice at least 30 days
     before cancellation or a material change in policy coverage.

ARTICLE 16 -- PROPRIETARY DATA

16.1 The Parties recognize that technical information may be disclosed by one
     Party to the other Party in the course of performance under the Contract
     and that the disclosing Party may desire to protect such information
     against unrestricted use or disclosure to others. To provide protection for
     such information, each Party agrees to respect such information and, to the
     extent it includes proprietary data, to handle such information as provided
     for in this Article.

16.2 For the purpose of this Contract, the term "proprietary data" means each
     Party's proprietary, secret, or confidential information, data, processes,
     and physical materials, including information originated by, or available
     only from the disclosing Party and information originating with a Third
     Party or Related Third Party with respect to which the disclosing Party has
     limited disclosure rights, and which the disclosing Party desires to
     protect against unrestricted disclosure to others, provided that such
     information, data, processes, and physical materials are marked
     "proprietary data" or with an equivalent legend or, if disclosed orally, is
     identified as proprietary at the time of initial disclosure and then
     summarized in a written document marked as "proprietary data" that is
     supplied to the receiving Party within ten (10) days of initial disclosure.

16.3 Except as permitted in the last sentence of this Paragraph 16.3 and in
     Paragraph 16.4 below, a Party receiving proprietary data shall take all
     reasonable precautions to prevent publication or disclosure of proprietary
     data to others, and shall use such data only for the purpose of performance
     under the Contract. Except as permitted in the last sentence of this
     Paragraph 16.3 and in Paragraph 16.4 below, any other use of such
     proprietary data shall be made only upon prior written consent of the
     disclosing Party. Each Party agrees to protect the other Party's
     proprietary data with the same degree of care as it protects its own
     proprietary data (but in no event less than a reasonable degree of care),
     and to restrict disclosures of such proprietary data to those persons,
     entities (e.g., insurance underwriters) and subcontractors having a need to
     know the data, provided any such person, entity or subcontractor must first
     agree in writing to treat any such proprietary data as confidential.

16.4 The aforementioned restrictions on the use and disclosure of proprietary
     data shall not apply if the proprietary data:

     16.4.1 Is in the public domain at the time of receipt or comes into public
          domain thereafter through no act of the receiving Party that is
          inconsistent with the aforementioned restrictions;

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     16.4.2 Known to the receiving Party prior to disclosure by the disclosing
          Party;

     16.4.3 Disclosed with the prior written approval of the disclosing Party;

     16.4.4 Independently developed by the receiving Party;

     16.4.5 Lawfully disclosed to the receiving Party by a Third Party under
          conditions permitting such disclosure; or

     16.4.6 Is required by applicable law, regulation or governmental order to
          be disclosed (but in such case only to the extent so required to be
          disclosed).

16.5 Upon termination or upon completion of performance under the Contract, and
     upon the request of one Party, the other Party shall return all proprietary
     data (including any copies thereof) received from that Party, or provide
     written certification that such proprietary data has been destroyed, except
     that either Party may retain a legal file copy.

16.6 Information exchanged under this Agreement may be subject to U.S. export
     control laws and regulations, such as the U.S. International Traffic in
     Arms Regulations (ITAR) or the Export Administration Regulations (EAR). The
     disclosing Party shall mark any such document to clearly indicate the laws
     and regulations that apply to the disclosed information. The receiving
     Party agrees that information subject to such export control laws and
     regulations shall not be disclosed or transferred to a Third Party or a
     Related Third Party without complying with all applicable U.S. export
     control laws and regulations. Such approval shall not be unreasonably
     withheld.

16.7 Information exchanged under this Agreement may be subject to Russian and
     Ukrainian export control laws and regulations. The disclosing Party shall
     mark any such document to clearly indicate the laws and regulations that
     apply to the disclosed information. The receiving Party agrees that
     information subject to such export control laws and regulations shall not
     be disclosed or transferred to a Third Party or a Related Third Party
     without first obtaining written approval from the disclosing Party and
     complying with all applicable U.S. export control laws and regulations.
     Such approval shall not be unreasonably withheld.

ARTICLE 17 -- RIGHTS TO INVENTIONS AND DATA

17.1 Sea Launch and XM agree that neither Party shall by entry into the Contract
     or by performance of the Contract, acquire any rights to or under the other
     Party's patents, proprietary data, or other intellectual property or
     technical information, unless the grant of any such right is expressly
     provided for herein or in a separate written agreement duly executed by the
     granting Party.

                                      -27-
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<PAGE>

***** Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

ARTICLE 18 -- CHANGES

18.1 Except as set forth in Paragraph 18.2, the Contract shall be modified only
     upon mutual consent and such modification shall be made in writing and
     shall be signed by both Parties.

18.2 XM may at any time up to [***], by a written notice, request changes within
     the general scope of this Contract. If XM requests a change after [***],
     any such change will be implemented by Sea Launch only if the launch date
     would remain unaffected as a result of such implementation, unless
     otherwise agreed to by Sea Launch. If any such change causes an increase or
     decrease in the cost of, or the time required for, the performance of any
     part of the work under this Contract, an equitable adjustment, to be
     negotiated in good faith between the Parties, shall be made in the price,
     delivery schedule, or other terms affected by the requested change, and the
     Contract shall be modified in writing accordingly. Any claim by Sea Launch
     for an adjustment must be made in writing within thirty (30) days of the
     receipt of any such notice. Nothing in this Article 18 shall excuse Sea
     Launch from proceeding without delay to perform this Contract as changed.

18.3 Sea Launch shall have the right to recommend changes within the general
     scope of this Contract. Sea Launch shall submit any such change to XM in
     writing and XM shall accept or reject such change in its sole discretion.
     XM shall respond to any such change proposed by Sea Launch promptly but in
     no event later than forty-five (45) days after the date on which Sea Launch
     submitted the proposed change. Sea Launch shall not proceed with any change
     under this Paragraph until an amendment to this Contract is executed by
     both Parties authorizing the change and making the corresponding
     adjustments to the work and/or the terms of this Contract necessitated by
     the change.

18.4 Launch Service(s) postponements by XM or Sea Launch shall be resolved in
     accordance with Article 7 of this Contract.

ARTICLE 19 -- ASSIGNMENT

The Parties agree not to assign their respective rights or obligations under the
Contract without the prior written consent of the other Party. Notwithstanding
the foregoing, XM may assign or transfer this Contract or all of its rights
hereunder to: (i) any parent, wholly-owned subsidiary or other affiliate of XM,
or (ii) any corporation in connection with the sale, transfer or assignment of
all or substantially all of XM's assets or capital stock, whether by way of
merger, consolidation, or otherwise. XM shall provide notice to Sea Launch of
any such assignment within 10 days of that assignment.

ARTICLE 20 -- PUBLIC RELEASE OF INFORMATION

20.1 Except as required by law or regulation, no news release, public
     announcement, or advertising material concerned with this Contract shall be
     issued by either Party without prior written consent of the other Party.
     Such consent shall not be unreasonably withheld. All releases shall be
     coordinated between both Parties.

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<PAGE>

20.2 The above notwithstanding, XM shall have the right (without the prior
     approval of Sea Launch) to provide general information about Sea Launch
     that is not false or misleading, including pictures of Sea Launch, in its
     public documents, news releases and advertising. In addition, Sea Launch
     agrees to provide XM with suitable pictures (or models) of launch vehicles
     for use in XM literature and advertising.

ARTICLE 21 -- DISPUTE SETTLEMENT

21.1 The Parties shall endeavor to reach an amicable settlement of any dispute
     or controversy resulting from, or arising in connection with, the
     performance of this Contract. In the event a settlement cannot be reached
     in a timely manner by the Sea Launch and XM Mission Managers, the dispute
     or controversy shall be referred to the respective Presidents of Sea Launch
     and XM, who shall use their reasonable best efforts to reach a settlement
     acceptable to both Parties. If such a settlement cannot be reached the
     dispute or controversy shall be submitted to arbitration to be conducted in
     Washington, D.C. under the Rules of Conciliation and Arbitration of the
     American Arbitration Association by three arbitrators appointed pursuant to
     the governing rules. The arbitration shall be conducted in English. The
     arbitration award shall be final and binding, and the execution thereof may
     be entered in any court having jurisdiction.

ARTICLE 22 -- APPLICABLE LAW

22.1 The Contract and any matter arising under the Contract, regardless of
     whether such matter is addressed in the Contract, shall be governed by the
     laws of the State of New York, USA, excluding its choice of law rules.

ARTICLE 23 -- SEVERABILITY

23.1 In the event any of the provisions of the Contract shall, for any reason
     whatsoever, be held to be invalid or unenforceable, the remaining
     provisions shall not be affected.

ARTICLE 24 -- WAIVERS

24.1 No waiver of any of the provisions of the Contract shall be binding on
     either Party unless evidenced by a written notice signed by the Party to be
     bound. Failure of either Party to insist upon performance of any of the
     terms or conditions herein or to exercise any right or privilege shall not
     constitute a waiver. A waiver by either Party of a breach of any provision
     of this Contract does not constitute a waiver of any succeeding breach of
     the same or any other provision, nor shall it constitute a waiver of the
     provision itself.

ARTICLE 25 -- ENTIRE AGREEMENT

25.1 The Contractual documents referred to in Article 2 and the letter from Sea
     Launch to XM dated August 1, 2003 (the "August 1 Letter") comprise the
     entire understanding between the Parties with respect to the subject matter
     of the

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<PAGE>

     Contract and shall supersede all prior and contemporaneous discussions
     between the Parties. Except for the August 1 Letter, neither Party shall be
     bound by any conditions, warranties, definitions, statements, or documents
     previous to the Contract unless the Contract makes express reference
     thereto.

IN WITNESS WHEREOF, the Parties hereto have executed the Contract as of the day
and year stated:

XM Satellite Radio Holdings Inc.        Sea Launch Limited Partnership acting
                                        through its General Partner, Sea Launch
                                        Company, L.L.C.

By:                                     By:
       -------------------------------         --------------------------------
Title:                                  Title:
       -------------------------------         --------------------------------
Date:                                   Date:
       -------------------------------         --------------------------------

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XM and Sea Launch Proprietary

<PAGE>

                                STATEMENT OF WORK

                                       For

                               XM Satellite Radio

                                 LAUNCH SERVICES

                                 August 4, 2003

                                     [LOGO]
                                 SEA LAUNCH (R)

                             Sea Launch Company, LLC
                        One World Trade Center, Suite 950
                        Long Beach, California 90831, USA

                             SEA LAUNCH PROPRIETARY

<PAGE>

                             SEA LAUNCH PROPRIETARY

TABLE OF CONTENTS

ABBREVIATIONS AND ACRONYMS.....................................................3

SCOPE..........................................................................5

Reference Documents............................................................5

1.    PROGRAM MANAGEMENT.......................................................6

1.1     Documentation, Reports, Meetings and Reviews...........................6
1.1.1   Documentation..........................................................6
1.1.2   Reports................................................................7
1.1.3   Schedules..............................................................8
1.1.4   Meetings and Reviews...................................................8
1.2   Quality..................................................................9
1.3   Safety...................................................................9

2.    LAUNCH VEHICLE...........................................................9

2.1   Launch Vehicle Hardware..................................................9
2.2   Performance.............................................................10
2.2.1   Launch Vehicle Performance - Orbit and Mass...........................10
2.2.2   Mission Optimization..................................................10
2.3   Spacecraft to Launch Vehicle Interfaces.................................10
2.3.1   Mechanical Interfaces.................................................10
2.3.2   Electrical Interfaces.................................................10
2.3.3   Spacecraft/spacecraft Adapter Interface Test Support..................11
2.4   Spacecraft Separation Conditions........................................11
2.5   Environmental Requirements..............................................11

3.    MISSION ANALYSIS........................................................11

4.    LAUNCH SERVICES AND FACILITIES..........................................13

4.1   Sea Launch Home Port, Long Beach, California, United States of America..13
4.1.1   Facilities............................................................13
4.1.2   Services..............................................................13
4.2   Assembly and Command Ship (Acs).........................................14
4.2.1   Facilities............................................................14
4.2.2   Services..............................................................14
4.2.3   Number of Xm and Bss Personal On the Acs for the Launch Campaign At
           Sea................................................................14
4.3   Launch Platform.........................................................14
4.3.1   Facilities............................................................15
4.3.2   Services..............................................................15
4.3.3   Number of Xm and Bss Personal On the Lp for the Launch Campaign At
           Sea................................................................15
4.4   Communications..........................................................15
4.5   Launch Services.........................................................16
4.6   Range Services..........................................................16

5.   POST LAUNCH SERVICES.....................................................17

6.   SEA LAUNCH RESPONSIBILITIES..............................................17

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                             SEA LAUNCH PROPRIETARY

7.   XM RESPONSIBILITIES......................................................17

LIST OF TABLES

Table 1.1.4-1. Sea Launch Meetings and Reviews.................................9
Table 3-1. Sea Launch  Mission Analysis Tasks.................................13
Table 6.1. Sea Launch  Deliverables...........................................17
Table 7-1. XM Deliverables....................................................18

ABBREVIATIONS AND ACRONYMS

    ACS   Assembly and Command Ship

    BSS   Boeing Satellite Systems

    CDR   Critical Design Review

    CLA   Coupled Loads Analysis

    DTM   Displaced Transformation Matrix

    EMC   Electromagnetic Compatibility

    EMI   Electromagnetic Interference

    GMM   Geometric Math Model

    GSE   Ground Support Equipment

    HAR   Hardware Acceptance Review

    HP    Home Port, Long Beach, CA

    ICD   Interface Control Document

    ILV   Integrated Launch Vehicle

    LLC   Limited Liability Company

    LP    Launch Platform

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                             SEA LAUNCH PROPRIETARY

    LV    Launch Vehicle

    L-    Launch Minus

    PDR   Preliminary Design Review

    PLA   Payload Accommodations

    PLU   Payload Unit

    PPF   Payload Processing Facility at Sea Launch Home Port, Long Beach, CA

    SC    Spacecraft

    SL    Sea Launch

    SOW   Statement of Work

                             SEA LAUNCH PROPRIETARY

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                             SEA LAUNCH PROPRIETARY

Scope

This Statement of Work (SOW) encompasses the launch services to be supplied by
Sea Launch Limited Partnership acting through its general partner, Sea Launch
Company, LLC (Sea Launch) to XM Satellite Radio Holdings Inc. (XM) for the XM-4
mission utilizing a BSS-702 spacecraft (SC) manufactured by Boeing Satellite
Systems (BSS).

Sea Launch shall perform the tasks and provide the equipment and facilities
specified in this SOW to provide launch services for the XM-4 spacecraft. Launch
Services shall be provided using the Sea Launch launch vehicle (LV), the
Zenit-3SL. The mission shall be conducted from Sea Launch's Assembly and Command
Ship (ACS) and Launch Platform (LP) in the equatorial region of the Pacific
Ocean. Sea Launch, at no additional cost to XM, will interface with BSS as
required for the design, integration, test and launch of the XM-4 spacecraft,
including Sea Launch provision of the services, deliverable data and equipment
specified in the SOW.

This Statement of Work includes the following areas:

1.   Program Management
2.   Launch Vehicle
3.   Mission Analysis
4.   Launch Services and Facilities
5.   Post Flight Reporting
6.   Sea Launch Responsibilities
7.   XM Responsibilities

Unless specified otherwise, times are presented in months prior to launch,
'L-x'.

Reference Documents

Parts of the following documents are incorporated into this Exhibit to the
extent that they are specifically referenced herein. Where a conflict exists,
the Statement of Work takes precedence.

1)   D688-10009-1, Sea Launch User's Guide, Revision C, January 2003
2)   D688-10024-1, Sea Launch Safety Regulations Manual (Chapters 3 and 4), Rev.
     New, 16 July 1998
3)   D688-10658-1, Sea Launch Facilities Accommodations Handbook, Rev Draft, 14
     March 2001

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                             SEA LAUNCH PROPRIETARY

1.   Program Management

Sea Launch shall supply the Program Management necessary to cover all aspects of
the Contract for Launch Services. Program Management tasks shall include the
following:

     .    LV hardware production
     .    Document generation, control and delivery
     .    Meetings and reviews
     .    Mission analysis
     .    Applicable Home Port activities including joint operations (Sea Launch
          shall support, but not provide direct management of, autonomous SC
          activities)
     .    All launch site activities
     .    Post launch reports
     .    Safety provisions
     .    Quality provisions

Sea Launch shall assign a dedicated Sea Launch Mission Manager no later than one
month after contract signature. All Sea Launch deliverable documentation shall
be transmitted through the Sea Launch Mission Manager to XM and/or BSS. The Sea
Launch Mission Manager shall be responsible for all XM-4 functions related to
the execution of the Contract for Launch Services.

XM shall assign an XM Mission Manager no later than one month after contract
signature. All XM deliverable documentation shall be transmitted through the XM
Mission Manager to Sea Launch. The XM Mission Manager shall be responsible for
all XM-4 functions related to the execution of the Contract for Launch Services.

1.1   Documentation, Reports, Meetings and Reviews

1.1.1 Documentation

Sea Launch shall prepare all documentation required to provide the launch
services, as specified in section 6, table 6-1. Sea Launch shall maintain a
configuration control system for the mission unique documentation. XM shall
provide timely inputs to Sea Launch to support development of documentation, as
specified in section 7, table 7-1.

Sea Launch shall maintain configuration control of signed mission specific
documentation subject to the agreement of both parties. Formal change proposals
shall be submitted to XM for

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                             SEA LAUNCH PROPRIETARY

review and approval. Contract modifications may be required for changes that
exceed the scope of the launch services contract.

Sea Launch shall accept mission specific documentation directly from BSS as
required. Sea Launch shall provide mission specific documentation to BSS and XM
as required.

The Sea Launch Mission Manager and XM shall agree upon the specific number of
copies and medium type for document deliveries, on a case-by-case basis.

Interface Control Documentation: Sea Launch shall develop a SC to LV Interface
Control Document (ICD) based on timely inputs from XM and/or BSS. Once signed by
both Sea Launch, BSS and XM, the ICD shall become the contractual document
defining the technical requirements for launch services, superseding the
technical integration requirements of this Statement of Work. Sea Launch and XM
shall each verify their respective requirements as defined in the ICD. All
verification shall be completed prior to launch.

Procedures: All Sea Launch operations are conducted in accordance with Sea
Launch approved, released procedures that are maintained under configuration
control. All combined procedures that address joint operations between the SC
and the Sea Launch system are reviewed and agreed to with XM and BSS prior to
commencement of operations. All SC hazardous and on-site procedures shall be
under BSS configuration control and will be provided to Sea Launch for review
per section 7, table 7-1.

1.1.2 Reports

Sea Launch shall provide to XM the reports specified in section 6, table 6-1. A
preliminary delivery schedule for these reports is provided in table 6-1. Sea
Launch and XM shall mutually agree upon a final delivery schedule after contract
award.

Sea Launch shall provide XM with access to documents, which are not normally
deliverable items, at the request of XM, which are reasonable and not restricted
by any applicable export regulation.

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                             SEA LAUNCH PROPRIETARY

1.1.3 Schedules

Sea Launch shall maintain mission integration schedules that cover all aspects
of program management for the launch services. Sea Launch shall provide the
schedules to XM on a quarterly basis.

Sea Launch and XM shall develop and mutually agree to a mission-specific
milestone and documentation schedule within 30 days of Contract signature by
both parties. This milestone schedule shall provide all major technical
milestones necessary for successful completion of the Contract for Launch
Services. This milestone schedule shall be based upon table 6-1 and table 7-1.
The mission integration schedule shall be presented at applicable reviews.

1.1.4 Meetings and Reviews

Sea Launch and XM agree to conduct meetings/reviews as often as necessary to
allow timely execution of all activities to support the Mission. These shall
include, but not be limited to the meetings/reviews identified in table 1.1.4-1.
Approximate timing of the meeting/review is shown, with the final timing to be
agreed to between Sea Launch and XM.

XM is invited to all meetings listed in table 1.1.4-1. The Sea Launch Mission
Manager and the XM Mission Manager shall agree upon specific meeting locations,
agendas, logistics and participation in advance, on a case-by-case basis.

Meetings and reviews shall be normally held at Sea Launch facilities in Long
Beach, California, unless otherwise agreed to by XM and Sea Launch.

XM shall invite Sea Launch to attend the XM-4 SC design reviews and readiness
reviews.

Sea Launch and XM shall have access to the Sea Launch, XM and BSS facilities to
attend meetings and reviews as defined above. Sea Launch and XM shall obtain
necessary approvals for their respective personnel to attend the meetings and/or
reviews.

Sea Launch shall (i) submit an agenda at least ten (10) days in advance of the
meeting or review, (ii) take minutes, (iii) maintain an action items list, and
(iv) circulate the minutes and action items to XM within five (5) days following
the meeting or review.

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<PAGE>

***** Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                             SEA LAUNCH PROPRIETARY

                 Table 1.1.4-1. Sea Launch Meetings and Reviews

                                      [***]

1.2  Quality

Sea Launch shall maintain a mission success and quality assurance program for
the processes, procedures, and documentation in place at Sea Launch 's
facilities and operations to ensure effective mission success and quality
assurance for the XM-4 mission.

Sea Launch shall also present the design and qualification status of all new
(not previously, successfully flown) hardware and software whether mission
unique or generic. Sea Launch shall also present the design and qualification
status of ground support systems hardware and software. Appropriate reviews
(PDR, CDR, and HAR) shall be held as defined in table 1.1.4.

1.3  Safety

To ensure safety related to the XM mission, XM shall submit safety data to the
Sea Launch, as defined in the Sea Launch Safety Regulations Manual (chapters 3
and 4). XM shall provide the safety inputs defined in section 7, table 7-1. Sea
Launch shall deliver the safety deliverables defined in section 6, table 6-1.

2.   Launch Vehicle

Sea Launch shall supply all the LV hardware, software and consumables necessary
to provide the Launch Service. This shall include the design, manufacture, and
qualification of all standard and mission-unique hardware and software defined
herein.

2.1  Launch Vehicle Hardware

Sea Launch shall provide the Zenit-2S booster, the Block DM-SL upper stage, and
Payload Accommodations (PLA). The PLA consists of the spacecraft adapter (SCA),
payload structure, interface skirt, payload fairing, flight avionics and
instrumentation. The PLU consists of the PLA with the SC encapsulated in it.

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<PAGE>

***** Certain information on this page has been omitted and filed separately
with the Securities and Exchange Commission. Confidential treatment has been
requested with respect to the omitted portions.

                             SEA LAUNCH PROPRIETARY

2.2  Performance

2.2.1 Launch Vehicle Performance - Orbit and Mass

The launch vehicle shall deliver equivalent performance, based on a separated SC
mass of 6,000 kg to [***].

2.2.2 Mission Optimization

Sea Launch shall optimize the mission design consistent with the constraints of
the LV and Paragraph 2.2.1 above. The orbital parameters shall be optimized for
[***]. Performance curves of the Launch Vehicle shall be provided to XM and BSS
to support this optimization.

2.3  Spacecraft to Launch Vehicle Interfaces

The SC to LV interfaces are as specified in the herein-referenced sections of
the Sea Launch User's Guide. Once signed, the XM-4 SC to Sea Launch System ICD
shall supercede the interfaces defined here.

2.3.1 Mechanical Interfaces

The Spacecraft shall be mated to the upper stage via a Sea Launch provided
SCA702+ spacecraft adapter (SCA) and separation system. The adapter and the SC
shall be encapsulated in the payload fairing prior to mating with the Zenit 3SL.
The SC to LV mechanical interfaces shall be compatible with the mechanical
interfaces specified in the Sea Launch User's Guide, section 7.1.

2.3.2 Electrical Interfaces

The Sea Launch provided electrical interfaces shall include separation
connectors, umbilical wiring, SC telemetry and command links including RF
reradiation system, and in flight interfaces. Electrical interfaces shall be as
specified in the Sea Launch User's Guide, section 7.2 and Sea Launch Facilities
Accommodations Handbook, section 6.

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requested with respect to the omitted portions.

                             SEA LAUNCH PROPRIETARY

Sea Launch shall provide interface skirt umbilical path during transit to the
launch site. The T-0 umbilical path is not available during transit.

Sea Launch shall provide a reradiation system for SC telemetry and command that
supports a frequency range of [***]. Frequencies required outside this range may
be negotiated.

2.3.3 Spacecraft/Spacecraft adapter interface test support

SC to SCA interface tests are performed to verify proper fit and clearances of
the Sea Launch -provided SCA and separation system with the SC, and to provide a
flight-representative separation shock environment for purposes of spacecraft
environmental verification. Sea Launch, with support from XM as specified in
section 6, shall perform [***]. This test shall be performed at the spacecraft
manufacturer's factory. For the [***].

2.4  Spacecraft Separation Conditions

Preliminary injection accuracy, attitude accuracy, and minimum relative
separation velocity of the Block DM-SL at the time of SC separation shall be as
specified in the Sea Launch User's Guide, section 3.5. The final separation
conditions shall be as specified in the ICD.

2.5  Environmental Requirements

Sea Launch shall ensure that during transportation, handling, and from launch
through SC separation, the SC is not exposed to environments exceeding those
defined in the Sea Launch User's Guide section 5.

3.   Mission Analysis

Sea Launch shall perform the following analyses for the XM mission to ensure
compatibility between the XM SC/GSE and the Sea Launch system. Each analysis
shall be performed in two cycles (preliminary and final) unless otherwise noted
in table 3-1. XM provided inputs to

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integration analysis are defined in section 7. A preliminary delivery schedule
for analysis results is defined in table 6-1.

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                  Table 3-1. Sea Launch Mission Analysis Tasks

                                      [***]

4.   Launch Services and Facilities

Sea Launch shall provide XM with pre-launch and launch-site facilities and
support services necessary for the processing, assembly, installation,
transportation, fueling, and launch of commercial SC.

4.1  Sea Launch Home Port, Long Beach, California, United States of America.

4.1.1 Facilities

Sea Launch shall provide facilities at the Home Port for SC processing, SC
fueling, and encapsulation into the payload fairing. Details of Sea Launch
Payload Processing Facilities (PPF) and customer office and storage areas are
documented in the Sea Launch Facilities Accommodations Handbook, section 3.
Mission unique facility configurations shall supersede the Sea Launch Facilities
Accommodations Handbook, and shall be specified in the ICD.

4.1.2 Services

Sea Launch shall assist in transportation of the SC in its shipping container
and GSE from local airports to the Home Port.

Sea Launch shall perform [***].

Sea Launch shall provide SC environmental control during all phases of SC
processing, per the Sea Launch Facilities Accommodations Handbook, section 3.2.

Sea Launch shall provide equipment as defined in the Sea Launch Facilities
Accommodations Handbook, section 3.2.23 and 3.11.

Sea Launch shall provide security services for XM SC, SC GSE, and personnel as
defined in the Sea Launch Facilities Accommodations Handbook, section 3.8.

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Sea Launch shall provide miscellaneous services defined in the Sea Launch
Facilities Accommodations Handbook, section 3.14.

4.2  Assembly and Command Ship (ACS)

4.2.1 Facilities

Sea Launch shall provide facilities aboard the ACS for the mechanical and
electrical integration of the encapsulated SC with the Zenit 3SL prior to
transfer to the Launch Platform. The ACS shall provide provisions for XM launch
support, living accommodations, customer office area and storage as defined in
the Sea Launch Facilities Accommodations Handbook, section 4. Mission unique
facility configurations shall be specified in the ICD.

4.2.2 Services

Sea Launch shall provide meal, recreation, and medical services as defined in
the Sea Launch Facilities Accommodations Handbook, section 4.5.

Sea Launch shall provide security for XM SC GSE and personnel as defined in the
Sea Launch Facilities Accommodations Handbook, section 4.6.

Sea Launch shall provide miscellaneous services defined in the Sea Launch
Facilities Accommodations Handbook, section 4.10.

Sea Launch shall provide communication services as defined in the Sea Launch
Facilities Accommodations Handbook, section 7.2.

4.2.3 Number of XM and BSS Personal on the ACS for the Launch Campaign at Sea

Sea Launch shall provide accommodations for a maximum of 15 combined XM and BSS
persons on the ACS during the portion of the launch campaign when the ACS is at
Sea.4.3 Launch Platform.

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4.3.1 Facilities

Sea Launch shall provide facilities on-board the Launch Platform (LP) for XM GSE
and SC monitoring, storage area, office area, and living accommodations as
defined in the Sea Launch Facilities Accommodations Handbook, section 5. Mission
unique facility configurations shall be specified in the ICD.

4.3.2 Services

Sea Launch shall provide meal, recreation, and medical services as defined in
the Sea Launch Facilities Accommodations Handbook, section 5.4.

Sea Launch shall provide security services for XM SC, SC GSE and personnel as
defined in the Sea Launch Facilities Accommodations Handbook, section 5.5.

Sea Launch shall provide communication services as defined in the Sea Launch
Facilities Accommodations Handbook, section 7.2.

Sea Launch shall provide SC environmental control during all phases of SC
transit and launch operations, per section 2.5 of this exhibit.

4.3.3 Number of XM and BSS Personnel on the LP for the Launch Campaign at Sea

Sea Launch shall provide accommodations for a maximum of 6 combined XM and BSS
persons on the LP during the portion of the launch campaign when the LP is at
Sea.

4.4  Communications

Sea Launch shall provide communications links for XM and BSS personnel between
the ACS, LP, Home Port, and external sites during SC Home Port processing and
mission operations as defined in the Sea Launch Facilities Accommodations
Handbook, sections 7.1 and 7.2.

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Sea Launch shall provide spacecraft communications, which link XM and BSS
personnel with the SC, as defined in the Sea Launch Facilities Accommodations
Handbook, section 7.3.

4.5  Launch Services

The following services are provided:

Sea Launch shall encapsulate the XM SC in the launch vehicle payload fairing in
the PPF, transport the encapsulated SC to the ACS, and integrate the
encapsulated SC with the LV.

Sea Launch shall transport the encapsulated SC from the PPF to the Assembly and
Command Ship.

Sea Launch shall perform testing of the ILV.

Sea Launch shall provide transportation of both vessels from Home Port to the
launch site and return to Home Port for the purpose of conducting the Launch.

Sea Launch shall transport the ILV to the launch site and conduct the launch of
the SC during the launch window specified in the ICD.

Sea Launch shall provide transportation for up to 12 XM and/or BSS persons from
the ACS to Honolulu, Hawaii, as soon as reasonably possible after the launch.
Details shall be specified in the ICD.

Sea Launch shall coordinate special services such as launch events, VIP charter
services to the launch site, and third party communications. Sea Launch and XM
shall agree upon specific requirements, logistics, participation, and costs in
advance, on a case-by-case basis.

4.6  Range Services

Sea Launch shall provide all necessary range telemetry assets and provide
tracking of the launch vehicle from launch through SC separation, via telemetry
data (real time or recorded).

Sea Launch shall provide all necessary telemetry assets to verify LV functions
and conditions from Launch to SC separation. Telemetry coverage (either real
time or recorded) shall be provided during powered flight and for discrete
events.

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5.   Post Launch Services

Sea Launch shall provide the following post-launch services, according to the
schedule provided in section 6:

     .    Post-launch tracking and reporting, including SC post-separation
          orbital parameters, to be delivered to XM at the launch site.

     .    Post-launch Report.

6.   Sea Launch Responsibilities

In addition to other obligations of Sea Launch as set forth in this SOW, Sea
Launch shall perform the tasks and provide the equipment and data specified
below at the approximate times indicated. Sea Launch and XM shall develop a
program schedule that shall contain calendar dates for the accomplishment of the
scheduled tasks.

                       Table 6.1. Sea Launch Deliverables

                                      [***]

7.   XM Responsibilities

In addition to other obligations of XM as set forth in this Statement of Work,
XM shall perform the tasks and provide the equipment and data specified below at
the times indicated below. Sea Launch and XM shall develop a program schedule
that shall contain calendar dates for the accomplishment of the scheduled tasks.

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requested with respect to the omitted portions.

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                           Table 7-1. XM Deliverables

                                      [***]

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