Document:

Exhibit 10.56

 

	
   

  	
  CONFIDENTIAL TREATMENT

  
	
   

  	
  REQUESTED BY CABLEVISION

  
	
   

  	
  SYSTEMS CORPORATION AND

  
	
   

  	
  CSC HOLDINGS, INC

  

 

Contract No. 11182004

 

CONTRACT BETWEEN

 

 

RAINBOW DBS COMPANY LLC

 

 

AND

 

 

LOCKHEED MARTIN CORPORATION

ACTING THROUGH

LOCKHEED MARTIN COMMERCIAL SPACE SYSTEMS

 

 

FOR

 

 

RAINBOW KA-BAND SPACECRAFT

 

 

Date: November 21, 2004

 

 

PROPRIETARY NOTICE

 

This contract
and the information contained herein is proprietary and confidential to Rainbow
DBS Company LLC and LOCKHEED MARTIN CORPORATION ACTING THROUGH LOCKHEED MARTIN
COMMERCIAL SPACE SYSTEMS and shall not be published, reproduced, copied,
disclosed, or used for other than its intended purpose without the express
written consent of a duly authorized representative of Rainbow DBS Company LLC
and LOCKHEED MARTIN CORPORATION ACTING THROUGH LOCKHEED MARTIN COMMERCIAL SPACE
SYSTEMS.

 

i

 

TABLE OF CONTENTS

 

	
  1.

  	
   

  	
  DEFINITIONS

  	
   

  
	
  2.

  	
   

  	
  SCOPE OF
  WORK

  	
   

  
	
   

  	
  2.1

  	
  Elements of
  Work

  	
   

  
	
   

  	
  2.2

  	
  Attachments

  	
   

  
	
   

  	
  2.3

  	
  Options

  	
   

  
	
  3.

  	
   

  	
  DELIVERABLE
  ITEMS AND DELIVERY SCHEDULE

  	
   

  
	
   

  	
  3.1

  	
  Deliverable
  Items/Promised Delivery Dates

  	
   

  
	
   

  	
  3.2

  	
  Time of the
  Essence

  	
   

  
	
   

  	
  3.3

  	
  Contractor
  Responsibility

  	
   

  
	
   

  	
  3.4

  	
  Customer
  Responsibility

  	
   

  
	
  4.

  	
   

  	
  PRICES

  	
   

  
	
   

  	
  4.1

  	
  ***

  	
   

  
	
   

  	
  4.2

  	
  Taxes

  	
   

  
	
   

  	
  4.3

  	
  ***

  	
   

  
	
  5.

  	
   

  	
  METHOD OF
  PAYMENT

  	
   

  
	
   

  	
  5.1

  	
  Spacecraft

  	
   

  
	
   

  	
  5.2

  	
  Performance Incentives

  	
   

  
	
   

  	
  5.3

  	
  Invoices

  	
   

  
	
   

  	
  5.4

  	
  Disputed
  Payments

  	
   

  
	
   

  	
  5.5

  	
  Currency/Place
  of Payment

  	
   

  
	
   

  	
  5.6

  	
  Late
  Payment

  	
   

  
	
  6.

  	
   

  	
  DELIVERY,
  TITLE AND RISK OF LOSS OR DAMAGE

  	
   

  
	
   

  	
  6.1

  	
  Spacecraft
  Delivery

  	
   

  
	
   

  	
  6.2

  	
  Delivery
  of Other Deliverable Items

  	
   

  
	
   

  	
  6.3

  	
  Title

  	
   

  
	
  7.

  	
   

  	
  CERTIFICATION,
  INSPECTION, ACCEPTANCE, WAIVERS

  	
   

  
	
   

  	
  7.1

  	
  General Requirements

  	
   

  
	
   

  	
  7.2

  	
  Waivers

  	
   

  
	
   

  	
  7.3

  	
  Inspections

  	
   

  
	
   

  	
  7.4

  	
  Spacecraft Acceptance Procedure

  	
   

  
	
   

  	
  7.5

  	
  Acceptance Procedures for Other Deliverable
  Items

  	
   

  
	
   

  	
  7.6

  	
  Remedy of Defects

  	
   

  
	
   

  	
  7.7

  	
  Post Launch Remedies

  	
   

  
	
  8.

  	
   

  	
  LAUNCH VEHICLE SELECTION

  	
   

  
	
   

  	
  8.1

  	
  Customer Responsibility

  	
   

  
	
   

  	
  8.2

  	
  Launch Vehicle Availability Date

  	
   

  
	
  9.

  	
   

  	
  INSURANCE

  	
   

  
	
   

  	
  9.1

  	
  Launch and
  On-Orbit Insurance

  	
   

  

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

ii

 

	
   

  	
  9.2

  	
  Insurance Claims

  	
   

  
	
   

  	
  9.3

  	
  “Work-in-Progress” Insurance

  	
   

  
	
  10.

  	
   

  	
  SUBCONTRACTS

  	
   

  
	
   

  	
  10.1

  	
  Subcontracts

  	
   

  
	
   

  	
  10.2

  	
  Key Subcontracts

  	
   

  
	
   

  	
  10.3

  	
  Indemnification/Release

  	
   

  
	
  11.

  	
   

  	
  PROPERTY ACCOUNTING

  	
   

  
	
   

  	
  11.1

  	
  Identification and Control

  	
   

  
	
   

  	
  11.2

  	
  Use of Inventory Parts/Use of Customer’s
  Parts

  	
   

  
	
  12.

  	
   

  	
  CHANGES
  REQUESTED BY CONTRACTOR OR CUSTOMER

  	
   

  
	
   

  	
  12.1

  	
  Contract Change Notice

  	
   

  
	
   

  	
  12.2

  	
  Acceptance of Change

  	
   

  
	
   

  	
  12.3

  	
  Non Refusal

  	
   

  
	
   

  	
  12.4

  	
  Price of Changes

  	
   

  
	
   

  	
  12.5

  	
  Changes To Meet Specifications

  	
   

  
	
   

  	
  12.6

  	
  Change of
  Designated Orbital Position of Satellite Ka-5

  	
   

  
	
  13.

  	
   

  	
  CONTRACT
  TECHNOLOGY

  	
   

  
	
   

  	
  13.1

  	
  Disclosure of Contract Technology

  	
   

  
	
   

  	
  13.2

  	
  Rights
  Granted in Contract Technology

  	
   

  
	
   

  	
  13.3

  	
  ***

  	
   

  
	
  14.

  	
   

  	
  RIGHT OF
  ACCESS, REPORTS, TESTING, MONITORING

  	
   

  
	
   

  	
  14.1

  	
  Access

  	
   

  
	
   

  	
  14.2

  	
  Reports

  	
   

  
	
   

  	
  14.3

  	
  Performance Testing

  	
   

  
	
   

  	
  14.4

  	
  Monitoring

  	
   

  
	
   

  	
  14.5

  	
  Export Laws Compliance

  	
   

  
	
  15.

  	
   

  	
  WARRANTY

  	
   

  
	
   

  	
  15.1

  	
  Spacecraft Warranty

  	
   

  
	
   

  	
  15.2

  	
  Warranty for Deliverable Items Other Than
  Spacecraft

  	
   

  
	
   

  	
  15.3

  	
  Disclaimer

  	
   

  
	
   

  	
  15.4

  	
  Assistance

  	
   

  
	
  16.

  	
   

  	
  DEFICIENCIES NOTED IN OTHER SPACECRAFT

  	
   

  
	
   

  	
  16.1

  	
  Qualification Heritage

  	
   

  
	
   

  	
  16.2

  	
  Notice

  	
   

  
	
  17.

  	
   

  	
  TERMINATION FOR CONVENIENCE

  	
   

  
	
   

  	
  17.1

  	
  Termination

  	
   

  
	
   

  	
  17.2

  	
  Termination Expense

  	
   

  
	
   

  	
  17.3

  	
  Termination Charges

  	
   

  
	
   

  	
  17.4

  	
  Subcontractor Settlements

  	
   

  
	
   

  	
  17.5

  	
  Inventory

  	
   

  
	
   

  	
  17.6

  	
  Subcontracts

  	
   

  

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

iii

 

	
   

  	
  17.7

  	
  ***

  	
   

  
	
  18.

  	
   

  	
  TERMINATION FOR CAUSE

  	
   

  
	
   

  	
  18.1

  	
  Termination by Customer

  	
   

  
	
   

  	
  18.2

  	
  Improper Termination

  	
   

  
	
   

  	
  18.3

  	
  Termination by Contractor

  	
   

  
	
  19.

  	
   

  	
  EXCUSABLE DELAYS

  	
   

  
	
  20.

  	
   

  	
  KEY PERSONNEL

  	
   

  
	
  21.

  	
   

  	
  DISPUTES

  	
   

  
	
   

  	
  21.1

  	
  Notice

  	
   

  
	
   

  	
  21.2

  	
  Escalation

  	
   

  
	
   

  	
  21.3

  	
  Further Escalation

  	
   

  
	
   

  	
  21.4

  	
  Litigation

  	
   

  
	
   

  	
  21.5

  	
  Other Remedies

  	
   

  
	
  22.

  	
   

  	
  INDEMNIFICATION

  	
   

  
	
   

  	
  22.1

  	
  Contractor’s General Indemnification

  	
   

  
	
   

  	
  22.2

  	
  Customer’s General Indemnification

  	
   

  
	
   

  	
  22.3

  	
  Contractor’s Intellectual Property
  Indemnification

  	
   

  
	
   

  	
  22.4

  	
  Intellectual Property Indemnification
  Exclusion

  	
   

  
	
   

  	
  22.5

  	
  Indemnification For Taxes

  	
   

  
	
   

  	
  22.6

  	
  Procedures

  	
   

  
	
  23.

  	
   

  	
  LIMITATION OF LIABILITY

  	
   

  
	
   

  	
  23.1

  	
  Limitation

  	
   

  
	
   

  	
  23.2

  	
  Exceptions

  	
   

  
	
  24.

  	
   

  	
  DAMAGE TO PERSONS OR PROPERTY, ASSOCIATED
  WITH LAUNCH, INTERPARTY WAIVER

  	
   

  
	
  25.

  	
   

  	
  REPRESENTATIONS AND WARRANTIES

  	
   

  
	
   

  	
  25.1

  	
  Mutual Representations and Warranties

  	
   

  
	
   

  	
  25.2

  	
  Contractor’s Special Representations and
  Warranties

  	
   

  
	
  26.

  	
   

  	
  ASSIGNMENT

  	
   

  
	
  27.

  	
   

  	
  CONFIDENTIALITY

  	
   

  
	
   

  	
  27.1

  	
  Identification of Proprietary Information

  	
   

  
	
   

  	
  27.2

  	
  Restrictions on Use, Disclosure

  	
   

  
	
   

  	
  27.3

  	
  Company Restricted Information

  	
   

  
	
   

  	
  27.4

  	
  Standard of Care

  	
   

  
	
  28.

  	
   

  	
  PUBLIC RELEASE OF INFORMATION

  	
   

  
	
  29.

  	
   

  	
  NOTICES AND REPORTS, AUTHORIZED
  REPRESENTATIVES

  	
   

  
	
   

  	
  29.1

  	
  Notices

  	
   

  
	
   

  	
  29.2

  	
  Authorized Representatives

  	
   

  
	
  30.

  	
   

  	
  CUSTOMER FURNISHED INFORMATION AND PROPERTY

  	
   

  

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

iv

 

	
   

  	
  30.1

  	
  Title

  	
   

  
	
   

  	
  30.2

  	
  Risk of
  Loss

  	
   

  
	
   

  	
  30.3

  	
  Use

  	
   

  
	
   

  	
  30.4

  	
  Taxes

  	
   

  
	
   

  	
  30.5

  	
  Encumbrances

  	
   

  
	
   

  	
  30.6

  	
  Return
  Transportation

  	
   

  
	
   

  	
  30.7

  	
  Damages

  	
   

  
	
  31.

  	
   

  	
  HAZARDOUS MATERIAL IDENTIFICATION AND
  MATERIAL SAFETY DATA

  	
   

  
	
  32.

  	
   

  	
  APPLICABLE LAWS

  	
   

  
	
  33.

  	
   

  	
  GENERAL

  	
   

  
	
   

  	
  33.1

  	
  Severability

  	
   

  
	
   

  	
  33.2

  	
  Cumulative Rights/Waivers

  	
   

  
	
   

  	
  33.3

  	
  Gender/Captions

  	
   

  
	
   

  	
  33.4

  	
  Relationship of the Parties

  	
   

  
	
   

  	
  33.5

  	
  Permitted Access to Work in Progress,
  Inspections, Etc.

  	
   

  
	
   

  	
  33.6

  	
  Construction

  	
   

  
	
   

  	
  33.7

  	
  Including

  	
   

  
	
   

  	
  33.8

  	
  Survival

  	
   

  
	
   

  	
  33.9

  	
  Entire Agreement

  	
   

  
	
   

  	
  33.10

  	
  Counterparts

  	
   

  

 

ATTACHMENTS

 

	
  Attachment
  1 - Statement of Work, dated November 5, 2004

  	
   

  
	
  Attachment
  2 - Spacecraft Performance Requirements, dated November 17, 2004

  	
   

  
	
  Attachment
  3 - Spacecraft Performance Verification Requirements, dated November 17,
  2004

  	
   

  
	
  Attachment
  4 - Spacecraft Product Assurance Requirements, dated November 5, 2004

  	
   

  
	
  Attachment
  5 - Satellite Control and Operations Requirements, dated November 5,
  2004

  	
   

  
	
  Attachment
  6 - Satellite Control and Operations Product Assurance Requirements, dated
  November 5, 2004

  	
   

  
	
  Attachment
  7 - Milestone Payment Plan, dated November 21, 2004

  	
   

  
	
  Attachment
  8 - Maximum Termination Liability and Letter of Credit Amount Requirements,
  dated November 21, 2004

  	
   

  
	
  Attachment
  9 - Export Laws Compliance Program, dated November 21, 2004

  	
   

  
	
  Attachment
  10 - Certification – Form

  	
   

  
	
  Attachment
  11 - Bill of Sale – Form

  	
   

  
	
  Attachment
  12 - Options

  	
   

  
	
  Attachment
  13 - ***

  	
   

  
	
  Attachment
  14 - ***

  	
   

  
	
  Attachment
  15 - Letter of Credit – Form

  	
   

  
	
  Attachment
  16 - ***

  	
   

  

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under
the Securities Exchange Act of 1934.

 

v

 

CONTRACT FOR RAINBOW KA BAND SPACECRAFT

AND ASSOCIATED EQUIPMENT AND SERVICES

 

THIS CONTRACT
(the “Contract”) is entered into this 21st day of November, 2004,
(the “Effective Date of Contract” or “EDC”), by and between Lockheed Martin
Corporation, a corporation organized under the laws of Maryland, acting through
Lockheed Martin Commercial Space Systems, with its principal place of business
located at 100 Campus Drive, Newtown, Pennsylvania (“Contractor”), and RAINBOW
DBS COMPANY LLC, a Delaware limited liability company, with its principal place
of business located at 200 Jericho Quadrangle, Jericho, New York 11753, U.S.A.
(“Customer”).

 

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

 

WHEREAS
Customer desires to procure five (5) Ka-band satellites, associated launch
services and ground equipment subject to the terms and conditions hereof; and

 

WHEREAS
Contractor desires to supply such satellites, associated launch services and
ground equipment in accordance with the terms and conditions hereof;

 

NOW THEREFORE
THIS CONTRACT WITNESSETH THAT, in consideration of the mutual covenants and
agreements contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and intending to be
legally bound hereby, the Parties hereto agree as follows:

 

1.             DEFINITIONS

 

As used in
this Contract:

 

“Acceptance” with respect to any Deliverable Item other than a Spacecraft
shall be as defined in Paragraph 7.5. “Acceptance” with respect to a Spacecraft shall
be as defined in Paragraph 7.4.

 

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

 

“Bill of Sale” means a bill of sale in the
form of Attachment 11 attached hereto.

 

“Business Day” means a Day on which
Customer and Contractor are open for business, excluding Saturday, Sunday and a
Day on which banking institutions in New York City are required or authorized
to be closed.

 

“Certification” means a certification to be
provided to Customer by Contractor upon Delivery of each Spacecraft and other
Deliverable Item in the form of Attachment 10 attached hereto.

 

“CFE” means
Customer furnished equipment.

 

1

 

“Company Restricted Information” shall have
the meaning set forth in Paragraph 27.3.

 

“Conditional Acceptance” means (i) that
a Spacecraft does not meet the criteria for Unconditional Acceptance, but such
Spacecraft is not a Total Loss or a Constructive Total Loss, and (ii) that
Customer has accepted the Spacecraft in accordance with
Paragraph 7.4.3(b).

 

“Constructive Total Loss” means that at the
time of Acceptance: (i) less than*** of the Frequencies on a Spacecraft
are Successfully Operating Communications Channels, (ii) the Orbital
Maneuver Life of a Spacecraft is less than*** Days, (iii) it is
predictable that there will be continuously available during the Service Life
less than*** of the power allocated for communications payload operations
(including during eclipse periods) with simultaneous operations of all
Spacecraft functions in a mode reasonably required to maintain the health and
other performance parameters of the Spacecraft or, (iv) any combination of
the foregoing rendering the Spacecraft unable to operate at least*** of its
contemplated capacity for its Service Life.

 

“Contract” means this document, including
any amendments made pursuant to Paragraph 33.9, herein embodying the
agreement between Contractor and Customer and including the Attachments which
are annexed hereto and made a part of this Contract.

 

“Contract Background Data” means all
Information other than Contract Foreground Data, including Information which is
generated by the Contractor primarily at its own expense in connection with the
design, or research and development of its standard baseline products or “off-the-shelf”
items for other programs, or for other non-Customer projects to the extent such
Information is incorporated in, utilized in, or useful to the performance of
Work and/or relating to any Deliverable Items and/or used in connection with or
useful to the Contract Foreground Data.

 

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

 

“Contract Foreground Data” means all
Information, including Deliverable Data, directly generated or developed in the
performance of Work and/or relating to any Deliverable Items or which is
generated as a result of (i) significant design, research or development
efforts under this Contract or (ii) routine engineering of

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

2

 

Contractor’s
standard baseline products or other items incorporated into the Work.

 

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

 

“Contract Technology” means any and all
Contract Foreground Data and Contract Background Data and such Contract Intellectual
Property that is incorporated in, utilized in, or useful to the performance of
Work and/or relating to any Deliverable Items and/or used in connection with or
useful to the Contract Foreground Data.

 

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

 

“Customer” shall have the meaning set forth
in the preamble.

 

“Day” in the context of Performance
Incentives, means a continuous twenty-four (24) hour period commencing at
0001 Greenwich Mean Time. For all other purposes it means a twenty four
(24) hour period commencing at the occurrence of an event.

 

“Defect” means, with respect to any
Deliverable Item and any and all components thereof, any deficiency or
nonconformance in design, material or workmanship, or failure to perform in
accordance with the specifications and requirements set out or referred to in
this Contract.

 

“Deliverable Data” means all data and
documentation required to be delivered to Customer under this Contract, as set
forth in the Statement of Work, Attachment 3 and Attachment 5.

 

“Deliverable Hardware” means all property
other than Deliverable Data required to be delivered to Customer under this
Contract, including, without limitation, Spacecraft and the tangible media on
which Deliverable Data is delivered.

 

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

 

3

 

“Delivery” for Deliverable Items other than
a Spacecraft shall occur upon Acceptance as described in Paragraph 6.2. “Delivery” for a Spacecraft shall be as
described in Paragraph 6.1.

 

“Designated Launch Agencies” means the
Launch Vehicle providers selected in accordance with Article 8 hereof to
Launch the Spacecraft into geostationary transfer orbit and provide the Launch
Vehicles, the Designated Launch Sites and related facilities and equipment
necessary to accomplish such Launches.

 

“Designated Launch Sites” means the Launch
facilities provided by the Designated Launch Agencies including any off-site
processing facilities.

 

“Designated Orbital Positions” means the 62o,
71o, 77o, 119o and 129o west
longitude positions in geostationary earth orbit at which Customer intends to
locate and operate the Spacecraft, or any alternative orbital positions
obtained by Customer in lieu of the foregoing.

 

“Dollar” or “$” means a dollar of United States currency.

 

“Export Laws” shall have the meaning set forth in Paragraph 3.3.

 

“Export Laws Compliance Program” means the program described in
Attachment 9 that Contractor has implemented to obtain or amend, as applicable,
all United States or other Governmental Approvals necessary to provide
Customer, its employees, representatives and consultants, and the Designated
Launch Agencies, insurance brokers and underwriters, with access to the
Spacecraft, facilities and information as described herein and as necessary to
enter into and perform their obligations under the Launch Agreements and the
Insurance Agreements.

 

“Effective Date of Contract’ or “EDC” shall have the meaning set forth in the preamble.

 

“Escrow Agreement” shall have the meaning
set forth in Paragraph 13.3.4.

 

“FCC”
means the U.S. Federal Communications Commission and any successor agency.

 

“Frequency”
is a unit of 38 MHz of usable bandwidth on a Spacecraft.

 

“Governmental Approvals” means any permit,
license or approval of any government, governmental department or agency or
relevant regulatory authority required for the performance of this Contract.

 

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

 

“Information” means all data and
information, including, without limitation, data and information of a
technical, business or financial nature which has been documented on any
tangible media, including, without limitation, writings,

 

4

 

drawings, sound recordings,
software, pictorial representations and graphs. Except as otherwise provided in
the Contract, Information shall not include the Contractor’s financial reports,
cost analyses and other data and internal information incidental to contract
administration.

 

“Inoperative Frequency”
means a Frequency that does not meet the standards of a Successfully Operating
Communications Channel (i) for***, (ii) for a cumulative total of***,
or (iii) during any eclipse period.

 

“Insurance Agreements” mean the agreements
providing for insurance of the Spacecraft between Customer and insurance
underwriters as described in Article 9.

 

“Intentional Ignition” means the
intentional ignition by a Designated Launch Agency of the main or first stage
engines of a Launch Vehicle or such other definition as is contained in the
relevant Launch Agreement.

 

“IOT” means in orbit tests as specified in
the Statement of Work and Attachment 3.

 

“Key Subcontract” shall have the meaning
set forth in Paragraph 10.2.

 

“Key Subcontractor” shall have the meaning
set forth in Paragraph 10.2.

 

“Launch” means the launch of a Spacecraft
as defined in the relevant Launch Agreement.

 

“Launch Agreement(s)” means the
agreement(s) providing for the Launch of the Spacecraft between Customer and
the Designated Launch Agencies as described in Article 8.

 

“Launch Support” means Contractor’s
activities at the Designated Launch Sites in support of the Launches, as
specified in the Statement of Work.

 

“Launch Vehicles” mean the launch vehicles selected
for the Launch of the Spacecraft, in accordance with Article 8.

 

“Letter of Credit” means the letter of
credit that may be established by Customer in favor of Contractor in accordance
with Paragraphs 5.1.2 (b) through (d), inclusive and Attachment 15.

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

5

 

“License to Practice” means a right to use,
lease, offer for sale, market, advertise, promote, sell, dispose of and
otherwise practice, subject to the terms and conditions contained herein.

 

“Major Subcontractor” shall have the
meaning set forth in Paragraph 7.3.

 

“Milestone Payment Plan” means the
milestone payment plan for each Spacecraft and the TT&C and Pilot Uplink
Station Equipment attached hereto as Attachment 7.

 

“NSP” means Deliverable Items that are not
separately priced hereunder.

 

“Option” means any of the options described
in Attachment 12.

 

“Orbital Maneuver Life” means the period of
time following the In Service Date of a Spacecraft for which such Spacecraft
has sufficient fuel to be operated at its Designated Orbital Position, in
accordance with the requirements and standards set forth in the Spacecraft
Performance Requirements and allowing sufficient fuel to de-orbit such
Spacecraft at the end of its life in accordance with applicable governmental
requirements.

 

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

 

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

 

“Payment Due Date” shall have the meaning
set forth in Paragraph 5.1.1.

 

“Performance Incentives” means the monies
that may be earned by Contractor, as specified in item 6 of Tables
4.1.1 - 4.1.5, based on the performance of the Spacecraft, which
monies shall be payable to Contractor under the conditions set forth in
Paragraph 5.2.

 

“Promised Delivery Dates” mean the dates
promised for Delivery of the Spacecraft or for Delivery of other Deliverable
Items (as applicable) pursuant to Article 3.

 

“Proprietary Information” shall have the
meaning set forth in Paragraph 27.1.

 

“Restored Communications Channel”
means a Frequency that has become an Inoperative Frequency and has subsequently
been restored to operate in full compliance with the standards of a
Successfully Operating Communications Channel for a period of***.

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

6

 

“Right to Use” means a right to copy,
duplicate, reproduce, modify and otherwise use, subject to the terms and
conditions set forth herein.

 

“Satellite Simulators” means the dynamic
satellite simulators to be delivered by Contractor to Customer as defined in
the Statement of Work.

 

“Security Agreement” shall have the meaning
set forth in Paragraph 5.1.2(e).

 

“Service Life” for a Spacecraft means the
five thousand four hundred seventy-nine (5,479) Day period following final
Acceptance of the Spacecraft.

 

“Spacecraft” means one (1) or more of
the satellites to be constructed and launched as provided hereunder and
delivered in-orbit to Customer by Contractor.

 

“Spacecraft Performance Requirements” means
the spacecraft performance specifications for each Spacecraft attached hereto
as Attachment 2.

 

“Spacecraft Pre-Shipment Review” or “SPSR” shall have the meaning set forth in
Paragraph 7.4.1.

 

“Spacecraft System Price” shall have the
meaning set forth in Paragraph 4.1.

 

“Spacecraft Product Assurance Requirements” means the spacecraft product
assurance plan attached hereto as Attachment 4.

 

“Statement of Work” means the statement of
work attached hereto as Attachment 1.

 

“Subcontract” means a subcontract,
including purchase orders, memoranda of understanding and all similar forms of
agreement between Contractor and any Subcontractor at any tier, to provide a
portion of the Work under this Contract.

 

“Subcontractor” means a person, firm,
corporation or business entity which has been awarded a Subcontract by
Contractor to provide a portion of the Work covered by this Contract.

 

“Successful Injection” means that at the
time of separation of a Spacecraft from the Launch Vehicle,***. Damage to the
Spacecraft following separation from the Launch Vehicle but caused by the
Launch Vehicle shall be deemed to have occurred prior to separation from the
Launch Vehicle.

 

“Successfully Operating
Communications Channel” means ***.

 

“Successfully Operating Spacecraft”
means ***:

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

7

 

“TT&C and Pilot Uplink Station Equipment”
means the ground equipment as defined in the Statement of Work hereinafter
referred to as “TT&C Station Equipment”.

 

“Total Loss” of a Spacecraft means (i) the
complete loss, destruction or failure of such Spacecraft or (ii)***.

 

“Total Verified Termination Expense” shall
have the meaning set forth in Paragraph 17.2.

 

“Unconditional Acceptance” means that the
Spacecraft meets the criteria for unconditional acceptance specified in
Paragraph 7.4.3(a), and that Customer has accepted the Spacecraft in
accordance with Paragraph 7.4.3(a).

 

“Work” means all acts, including tests to
be performed, and materials, articles, data, documentation, and developments,
equipment, matters and things to be furnished and rights to be transferred by
Contractor or Subcontractor(s) under this Contract, or any contract or
subcontract entered into by Contractor or Subcontractor(s).

 

2.             SCOPE
OF WORK

 

2.1  Elements of Work

 

2.1.1  General
Scope.  Subject to the terms
and conditions of this Contract (including any Options as specified in
Attachment 12), Contractor shall sell and Customer shall purchase five (5) Spacecraft,
to be designated Rainbow Ka 1, Rainbow Ka 2, Rainbow Ka 3, Rainbow Ka 4, and
Rainbow Ka 5, and Contractor shall furnish and perform all the elements of the
Work for the purpose of such sale. Contractor shall furnish the Work in
accordance with the provisions of this Contract, including all Attachments
listed in Paragraph 2.2. The major elements of the Work include the
following:

 

(a)           Spacecraft.  Design, manufacture, in-plant test, prepare
each Spacecraft for Launch, integrate each Spacecraft with the applicable
Launch Vehicle, and following Successful Injection, in-orbit test and place
each Spacecraft into its Designated Orbital Position and present each
Spacecraft to Customer for Acceptance;

 

(b)           TT&C
Station Equipment.  Deliver, install
and test the TT&C Station Equipment, for each Spacecraft, including all
necessary equipment to monitor and control the five (5) Spacecraft
simultaneously and independently in accordance with Attachments 5 and 6;

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

8

 

(c)           Simulators.  Deliver two (2) Satellite Simulators per
Spacecraft, as specified in the Statement of Work, meeting the performance
requirements specified in Section 5 of Attachment 5, Satellite Control And
Operations Requirements;

 

(d)           Satellite
Database.  Provide satellite
databases as specified in Section 3 of Attachment 5, Satellite Control and
Operations Requirements;

 

(e)           Management.  Manage the program and conduct program
reviews;

 

(f)            Data
and Documentation.  Prepare and
provide to Customer data and documentation in accordance with the Statement of
Work, Attachment 3 and Attachment 5;

 

(g)           Containers.  Provide (as necessary) the temporary use of
containers for shipping and storage of the Spacecraft;

 

(h)           Offices.  Provide reasonable, full-time office
accommodations for up to*** Customer resident technical representatives at
Contractor’s facilities and reasonable accommodations for up to*** Customer
representatives visiting Contractor’s facilities for periodic meetings;

 

(i)            Insurance
Support.  Assist Customer in entering
into the Insurance Agreements, and in making any claims under any of the
foregoing Insurance Agreements;

 

(j)            Initial
Operations.  Provide initial
satellite control operations of each Spacecraft using the Contractor’s own
facilities and the Customer’s TT&C Station Equipment, starting from
Delivery of such Spacecraft, and continuing for a period of***, as outlined in Section 11
of Attachment 5;

 

(k)           Training.  Provide Spacecraft Operator Training for
each Spacecraft as outlined in Attachment 1; and

 

(l)            Governmental
Approvals.  Obtain all Governmental
Approvals necessary to fulfill its obligations hereunder.

 

2.1.2  Inherent,
Necessary, Customary Work.  If
any items, materials, or services not specifically described in this Contract
are an inherent, necessary or customary part of the Work and/or Deliverable
Items or are reasonably required for proper performance or provision of the
Work and/or Deliverable Items in accordance

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

9

 

with this Contract, they shall
be deemed to be included within the scope of the Work and /or Deliverable Items
to be delivered as provided herein, as if such items, materials, or services
were specifically described in this Contract; provided however that the
foregoing shall not expand the scope of Contractor’s obligations under the Statement
of Work.

 

2.2  Attachments

 

The Work to be performed by Contractor under
this Contract shall include, and be governed by, the Attachments listed below
which are attached hereto and made a part hereof. In the event of any conflict
or inconsistency among the provisions of the various parts of this Contract,
including the Attachments attached to and incorporated into this Contract, such
conflict or inconsistency shall be resolved by giving precedence to the terms
and conditions of this Contract without the Attachments and then to the
Attachments in the order listed below:

 

	
  Attachment 7

  	
   

  	
  —

  	
   

  	
  Milestone
  Payment Plan, dated November 21, 2004

  
	
  Attachment 8

  	
   

  	
  —

  	
   

  	
  Maximum
  Termination Liability and Letter of Credit Amount Requirements, dated
  November 21, 2004

  
	
  Attachment 1

  	
   

  	
  —

  	
   

  	
  Statement of
  Work, dated November 5, 2004

  
	
  Attachment 2

  	
   

  	
  —

  	
   

  	
  Spacecraft
  Performance Requirements, dated November 17, 2004

  
	
  Attachment 3

  	
   

  	
  —

  	
   

  	
  Spacecraft
  Performance Verification Requirements, dated November 17, 2004

  
	
  Attachment 4

  	
   

  	
  —

  	
   

  	
  Spacecraft
  Product Assurance Requirements, dated November 5, 2004

  
	
  Attachment 5

  	
   

  	
  —

  	
   

  	
  Satellite
  Control and Operations Requirements, dated November 5, 2004

  
	
  Attachment 6

  	
   

  	
  —

  	
   

  	
  Satellite
  Control and Operations Product Assurance Requirements, dated November 5,
  2004

  
	
  Attachment 9

  	
   

  	
  —

  	
   

  	
  Export Laws
  Compliance Program, dated November 21, 2004

  
	
  Attachment
  15

  	
   

  	
  —

  	
   

  	
  Letter of
  Credit—Form

  
	
  Attachment
  10

  	
   

  	
  —

  	
   

  	
  Certification—Form

  

 

10

 

	
  Attachment
  11

  	
   

  	
  —

  	
   

  	
  Bill of
  Sale—Form

  
	
  Attachment
  12

  	
   

  	
  —

  	
   

  	
  Options,
  dated November 21, 2004

  
	
  Attachment
  13

  	
   

  	
  —

  	
   

  	
  ***

  
	
  Attachment
  14

  	
   

  	
  —

  	
   

  	
  ***, dated
  November 21, 2004

  
	
  Attachment
  16

  	
   

  	
  —

  	
   

  	
  ***, dated
  November 21, 2004

  

 

2.3  Options

 

Customer shall have the options to procure
additional items specified in Attachment 12 which may be acquired from time to
time under the terms and conditions set forth therein.

 

3.             DELIVERABLE
ITEMS AND DELIVERY SCHEDULE

 

3.1  Deliverable Items/Promised Delivery Dates

 

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

 

	
  Deliverable

  Item No.

  	
   

  	
  Quantity

  	
   

  	
  Description

  	
   

  	
  Promised
  Delivery Date

  	
   

  	
  Point
  of Delivery

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.(a

  	
  )

  	
  1

  	
   

  	
  Spacecraft
  designated Rainbow Ka 2 as specified in Attachment 1 and Attachment 2

  	
   

  	
  EDC + 1140
  Days

  	
   

  	
  129oW

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.(b

  	
  )

  	
  1

  	
   

  	
  Spacecraft
  designated Rainbow Ka 1 as specified in Attachment 1 and Attachment 2

  	
   

  	
  EDC + 1231
  Days

  	
   

  	
  62Wo

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.(c

  	
  )

  	
  1

  	
   

  	
  Spacecraft
  designated Rainbow Ka 5 as specified in Attachment 1 and Attachment 2

  	
   

  	
  EDC + 1322
  Days

  	
   

  	
  119oW

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.(d

  	
  )

  	
  1

  	
   

  	
  Spacecraft
  designated Rainbow Ka 4 as specified in Attachment 1 and Attachment 2

  	
   

  	
  EDC + 1414
  Days

  	
   

  	
  71oW

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.(e

  	
  )

  	
  1

  	
   

  	
  Spacecraft
  designated Rainbow Ka 3 as specified in Attachment 1 and Attachment 2

  	
   

  	
  EDC + 1506
  Days

  	
   

  	
  77oW

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   2.

  	
   

  	
  1 lot

  	
   

  	
  All other
  documentation, software and data as specified in Attachment 1 and Attachment
  2

  	
   

  	
  Per
  Attachment 1 and Attachment 2

  	
   

  	
  Customer’s
  Designated Facility

  	
   

  

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

11

 

	
  Deliverable

  Item No.

  	
   

  	
  Quantity

  	
   

  	
  Description

  	
   

  	
  Promised
  Delivery Date

  	
   

  	
  Point
  of Delivery

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   3.

  	
   

  	
  1 lot

  	
   

  	
  Launch
  Support, insurance support, IOT, anomaly investigation support, and other
  support as specified in Attachment 1 and Attachment 2

  	
   

  	
  Per
  Attachment 1 and Attachment 2

  	
   

  	
  Per
  Attachment 1

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.(a

  	
  )

  	
  2 per

  Spacecraft

  	
   

  	
  Satellite
  Simulators

  	
   

  	
  Per
  Attachment 1

  	
   

  	
  A2100
  Satellite Operations Center, Newtown, PA

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.(b

  	
  )

  	
  1 lot

  	
   

  	
  On-Station
  Operations Documentation, as specified in Attachment 5

  	
   

  	
  Per
  Attachment 1

  	
   

  	
  A2100
  Satellite Operations Center, Newtown, PA

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.(c

  	
  )

  	
  1 lot at

  Primary

  Location(s) 1

  lot at Back-up

  Location(s)

  	
   

  	
  TT&C
  Station Equipment

  	
   

  	
  Per
  Attachment 1

  	
   

  	
  Prime and
  Back-up Stations in USA, Beacon Station in Canada for Ka-3 only. Final
  Locations TBC

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.(d

  	
  )

  	
  1 lot per

  Spacecraft

  	
   

  	
  Satellite
  Databases

  	
   

  	
  Per
  Attachment 1

  	
   

  	
  A2100
  Satellite Operations Center, Newtown, PA

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.(e

  	
  )

  	
  1 lot

  	
   

  	
  Satellite
  Operations Training

  	
   

  	
  Per
  Attachment 1

  	
   

  	
  Newtown, PA

  	
   

  

 

3.2  Time of the Essence

 

Subject to the terms and conditions of this
Contract, Contractor understands and agrees that the times for the Promised
Delivery Dates of the Spacecraft (Items 1 (a) through (e) set forth
above are of the essence to this Contract. Contractor shall perform its
obligations under this Contract in a timely manner. Contractor will support
Customer requests in making necessary filings with and explanations to the FCC
regarding the status of Spacecraft construction and Launch as it applies to
required milestones.

 

3.3  Contractor
Responsibility

 

Subject to the terms and conditions of this
Contract, including payments of the amounts due by Customer hereunder, delivery
of all Deliverable Items under this Contract shall be at Contractor’s expense.
Contractor shall be responsible for securing

 

12

 

any necessary Governmental
Approvals, including any relating to import of items to be delivered to the
Contractor by the Subcontractors and export of the Deliverable Items, in a
timely manner, as necessary to perform its obligations under this Contract. All
Governmental Approvals of any country required for compliance with Contractor’s
obligations under this Contract shall be referred to as “Export Laws”. Customer
agrees to cooperate with Contractor in executing such documents as shall be
necessary for compliance with Governmental Approvals under the Export Laws.

 

3.4  Customer Responsibility

 

Subject to the terms and conditions of this
Contract, including payments of the amounts due to Contractor hereunder,
Customer shall be responsible for securing all FCC and ITU approvals (on ground
and in-orbit), including frequency coordination for IOT and on-station
operations. In addition to the above, Customer is responsible for providing
TT&C facilities as specified in the TT&C facilities ICD referenced in
the Statement of Work, Attachment 1.

 

4.             PRICES

 

4.1  ***

 

4.2  Taxes

 

Each Spacecraft System Price and the prices
for all other deliverables (including Options deliverables) under this Contract
include all taxes, duties, transportation, insurance and all other costs and
charges associated with the performance of all Work. Contractor shall be
responsible for payment of all taxes and duties which may be required under any
laws which become due by reason of performance of the Work, and Contractor
shall comply with all requirements of said laws, including payment of any
interest or penalties related to or arising from such taxes and duties.

 

4.3  ***

 

4.3.4  Other
Remedies.  Nothing contained
in this Paragraph 4.3 shall affect any right or remedy available to
Customer, under this Contract, for delay exceeding the number of Days stated in
Paragraph 4.3.1.

 

4.3.5  Contractor
Notice.  Contractor shall
immediately notify Customer of any circumstance that will cause or threaten to
cause a delay in Delivery. Contractor shall provide Customer no less frequently
than monthly with Contractor’s best estimate of when Delivery will occur
(liquidated damages shall only be assessed for actual delays, not anticipated
delays).***

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

13

 

4.3.7  Failure to
Notify.  Contractor
acknowledges and agrees that its failure to keep Customer informed of
reasonably predictable delays in Delivery may cause damages to Customer related
to the failure to give notice. In such a case, Customer may seek recovery for
the damages caused by Contractor’s failure to give notice of such delay within
a reasonable period after Contractor knows that such a delay will occur.
Contractor’s damages under this provision shall be limited to the actual
damages incurred by Customer proximately caused by the lack of notice, and such
damages shall be capped at ***.

 

5.             METHOD
OF PAYMENT

 

5.1  Spacecraft

 

5.1.1  Milestones.  Payment by Customer to Contractor of the
amount due for each Spacecraft (less Performance Incentives) and other
Deliverable Items as specified in items 1 through 5, 8 and 9 in Tables
4.1.1 - 4.1.5 of this Contract (as may be adjusted pursuant to
Paragraph 4.3.1) shall be made in accordance with the Milestone Payment Plan
for such Spacecraft and the conditions specified therein. The amounts specified
in the Milestone Payment Plan for each Spacecraft and its related Deliverable
Items shall in each case be paid by Customer to Contractor within thirty
(30) Days after receipt by Customer of an invoice from Contractor (the “Payment
Due Date”), accompanied by a certification from Contractor’s Authorized
Representatives, that the particular milestone events for which payment is
being claimed in each case have been completed and enclosing any other
documentation necessary to demonstrate the completion of such milestones.
Contractor shall submit no more than one (1) invoice per calendar month
per Spacecraft, which shall list all completed milestones with respect to such
Spacecraft for that month. Contractor shall not submit invoices for a
Spacecraft, the amounts of which, when paid, will cause the total amount paid
under the Contract with respect to such Spacecraft to exceed the aggregate sum
scheduled to be paid with respect to such Spacecraft to that point in time as
provided in the Milestone Payment Plan. In accordance with Article 12, if
a change is accepted and implemented, the Milestone Payment Plan will be
modified to reflect the change in Spacecraft Price within thirty (30) Days
following initial implementation of said change.

 

5.1.2  Further
Assurances.***

 

(f)            Financial
Information.  In lieu of committing
to a cash payment, Letter of Credit or Security Agreement under Paragraphs
5.1.2(a), (b), (c), (d), or (e), Customer may provide financial information,
which, in the sole discretion of Contractor, is satisfactory for Contractor to
allow Customer to make payments under the Milestone Payment Plan set forth in
Attachment 7. Should such financial information not be available or satisfactory,
Customer

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

14

 

shall provide
further assurances under either Paragraphs 5.1.2(a), (b), (c), (d), or (e). If,
after doing so, Customer financial information becomes available, which, in the
sole discretion of Contractor, provides Contractor satisfactory payment
assurance, then Contractor may at that time elect to waive any other further assurance
requirements hereunder.

 

5.2  Performance Incentives

 

***

 

5.3  Invoices

 

All Contractor invoices shall be submitted in
three (3) copies to:

 

RAINBOW DBS COMPANY LLC

200 Jericho Quadrangle

Jericho, New York 11753 U.S.A.

 

ATTN: Tom Greco

 

5.4  Disputed
Payments 

 

If Customer
concludes that an item for which an invoice has been submitted is not payable
in accordance with the terms of this Contract, or that any milestone or
condition established by this Contract as a prerequisite to payment has not
been fulfilled, Customer shall so notify Contractor within twenty
(20) Days of receipt of the applicable invoice. Such notification shall
state the areas, which are considered not to be in accordance with the terms
and conditions of this Contract and state what is required to be submitted or
performed to satisfy the discrepancy. Upon correction of the noted
discrepancy(ies), the invoice shall be resubmitted for payment within ten (10) Days.
Customer shall pay any undisputed amount of invoices within the payment terms
in this Contract. If the Parties cannot agree that a discrepancy(ies) has been
resolved, Contractor and Customer will utilize the dispute provision in
accordance with Article 21.

 

5.5  Currency/Place
of Payment

 

5.5.1  Currency/Method and Receipt of Payment.  All payments and/or refunds due from either
Party to the other shall be made in Dollars. Payments and/or refunds to a Party
shall be made by wire transfer of funds, with reference to the invoice number
being paid in the detail section of the payment, to such place for
payments and/or refunds as the receiving Party’s Authorized Representative may
designate from time to time in writing. All payments and/or refunds due from
either Party to the other shall be

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

15

 

deemed to have been made when
the bank account of the receiving Party, as specified in Paragraph 5.5.2
or 5.5.3, has been credited with such payment, in the currency specified herein
for such payment.

 

5.5.2  Payments
to Contractor.>  Unless
Contractor otherwise notifies Customer, all payments of Contractor’s invoices
shall be made by Customer to:

 

***

 

5.5.3  Payments
to Customer.  Unless Customer
otherwise notifies Contractor, all refunds, credits or other amounts due
Customer hereunder shall be made by Contractor to:

 

***

 

5.6  Late Payment

 

5.6.1  Late Payment Charge.  In the event either Party fails to pay any
amounts due by it to the other Party within the times specified in this
Contract, which amounts are not the subject of a good faith dispute, the
receiving Party may impose a late payment charge of ***, assessable from the
first Day the payment is late. Amounts that are disputed in good faith will not
be subject to late payment charges so long as any undisputed portion is paid
within the time period required.

 

5.6.2  Work
Stoppage.  In no way limiting
the terms of Paragraph 5.6.1, in the event that Customer fails to pay any
amounts due by it to the Contractor within the times specified in this
Contract, which amounts are not the subject of a good faith dispute as set
forth in Paragraph 5.6.1, Contractor may, by written notice to Customer,
if such failure is not corrected by Customer within ten (10) Business Days
after written notice is given by Contractor (or such longer period as
Contractor may agree to in writing) stop Work under the Contract with respect
to the Spacecraft for which payment is late until such failure is corrected.
Contractor shall immediately resume Work under this Contract when the failure
is corrected, and the Parties shall negotiate in good faith an equitable
adjustment to schedule and price and any other affected terms and
conditions to reflect the reasonable impacts on Contractor resulting from such
Work stoppage. The Milestone Payment Plan will be modified to reflect the
increase of Spacecraft Price within thirty (30) Days. If Customer’s
failure to pay has not been cured within thirty (30) Days after
commencement of such Work stoppage, then Contractor shall be entitled to
terminate this Contract pursuant to Paragraph 18.3.

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

16

 

6.             DELIVERY, TITLE AND RISK OF LOSS OR DAMAGE

 

6.1  Spacecraft Delivery

 

Risk of loss for each Spacecraft shall pass
at the time of Intentional Ignition. Title to each Spacecraft and its
components shall transfer to Customer upon Acceptance. Delivery of each
Spacecraft shall occur upon either Unconditional Acceptance in writing by
Customer, Conditional Acceptance in writing by Customer or declaration of Total
Loss or Constructive Total Loss, each pursuant to Paragraph 7.4.3, and
delivery of a Bill of Sale for the Spacecraft.

 

6.2  Delivery of Other Deliverable Items

 

Risk of loss or damage and title to all
Deliverable Items other than the Spacecraft shall transfer from Contractor to
Customer upon Delivery. Delivery of such Deliverable Items shall occur upon
Acceptance in writing by Customer pursuant to Paragraph 7.5. Contractor
shall deliver a Bill of Sale with respect to the Deliverable Items set forth in
Paragraph 3.1, Items 4(a) through 4 (e).

 

6.3  Title

 

Contractor warrants that title to all
Deliverable Items delivered or transferred hereunder shall be good, marketable
and rightfully conveyed, and shall be delivered free and clear of all liens,
encumbrances, pledges and other interests whatsoever, other than those incurred
by Customer. Furthermore, Contractor agrees to execute and deliver a Bill of
Sale and all other instruments required, in Customer’s reasonable discretion,
to perfect or evidence such title in Customer.

 

7.             CERTIFICATION, INSPECTION, ACCEPTANCE, WAIVERS

 

7.1  General Requirements

 

Contractor is responsible for testing,
demonstrating, delivering, and certifying to Customer that each Spacecraft, and
all other Deliverable Hardware and Deliverable Data as specified in
Paragraph 3.1, Items 4(a) through 4(e), meet all of the requirements
of this Contract, including the Spacecraft Performance Requirements. Customer’s
right of inspection or acceptance shall not be deemed a waiver of any Defect,
except as may be expressly agreed in writing by Customer in accordance with
Paragraph 7.2 below. Prior to asking Customer to accept any Deliverable
Items and prior to Delivery, Contractor shall, subject to Paragraph 7.2
below, certify, in writing, in the form set forth in Attachment 10, that the
Deliverable Items conform to all Contract requirements.

 

7.2  Waivers

 

Contractor shall, in a timely manner, notify
Customer at such time that Contractor determines that it will not be able to
meet a particular Contract requirement or specification and shall seek a waiver
from Customer. Nothing herein shall be deemed to require Customer to grant a
waiver, but, if it is willing to consider doing so, Customer

 

17

 

may grant the waiver. No waiver
granted by Customer and no denial of a waiver by Customer shall affect the
Promised Delivery Date of any Deliverable Item unless Customer expressly so
agrees. Any waiver approved by Customer shall be deemed an amendment to the
applicable performance specification for such Deliverable Item for all purposes
hereunder, from and after such approval date; provided that a waiver granted
with respect to a particular Spacecraft of other Deliverable Item shall not be
deemed to apply to any other Spacecraft or Deliverable Item unless the waiver
expressly includes such other Spacecraft or Deliverable Item.

 

7.3  Inspections

 

***

 

7.4  Spacecraft
Acceptance Procedure

 

7.4.1  SPSR.  Contractor shall conduct a review (a “Spacecraft
Pre-Shipment Review” or “SPSR”) of each Spacecraft prior to Contractor’s
shipment of such Spacecraft to its Designated Launch Site. The SPSR shall be
conducted in accordance with the terms of this Paragraph 7.4 and Section 4.3.17
of the Statement of Work.

 

(a)           Time,
Place and Notice of SPSR.  Each SPSR
shall take place at Contractor’s facility. Contractor shall notify Customer in
writing approximately thirty (30) Days prior to the date that each
Spacecraft shall be available for SPSR, which shall be the scheduled date for
commencement of such SPSR. If Customer cannot commence such SPSR on such
scheduled date, Contractor shall make reasonable efforts to accommodate
Customer’s reasonable re-scheduling requests provided that any delay in
completion of SPSR resulting directly from such rescheduling shall be deemed an
excusable delay and such excusable delay period shall be excluded from any
calculation of excusable delay Days set forth in Paragraph 18.1.

 

(b)           Conduct
and Purpose of SPSR.  The purpose of
the SPSR shall be to review test data and analyses for each Spacecraft to
determine whether such Spacecraft meets the applicable Spacecraft Performance
Requirements and is therefore ready for shipment to its Designated Launch Site.

 

(c)           Pending
Waivers.  Any pending waiver
requests, or any circumstances which Contractor reasonably believes will result
in a Contractor request for waiver or deviation from, provisions(s) of the
performance specifications applicable to a Spacecraft or other related
Deliverable Item shall be submitted to Customer and

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

18

 

resolved prior
to the commencement of the applicable SPSR.

 

(d)           Customer’s
Inspection Representatives. 
Customer may cause any representatives designated by Customer to observe
each SPSR; provided, however, that the provisions of Article 27 shall
apply to any such representatives.

 

(e)           SPSR
Results.  At completion of the SPSR
for each Spacecraft, Contractor shall submit to Customer the SPSR results.
Within ten (10) Business Days of its receipt of such results, Customer shall
notify Contractor in writing of Customer’s concurrence or disagreement with the
results of the SPSR. In the event that Contractor and Customer concur that such
SPSR demonstrates conformity of the applicable Spacecraft to the applicable
requirements of the Spacecraft Performance Requirements (including any waivers
or deviations previously approved by Customer), the Spacecraft shall be
prepared and shipped to its Designated Launch Site for Launch. In the event
that such SPSR discloses any non-conformance of the Spacecraft to the
requirements of the Spacecraft Performance Requirements (not the subject of any
prior waivers or deviations approved by Customer), Customer’s notice shall
state each such non-conformance (with reference to the applicable requirement
of the Spacecraft Performance Requirements deemed not met), and Contractor
shall correct or repair (in the manner determined by Contractor) each such
non-conformance (except as may be subsequently waived by Customer), and
resubmit the Spacecraft for SPSR in accordance with this Paragraph 7.4.1
as to each corrected or repaired element.

 

(f)            Inspection
Costs Borne by Customer.  All costs
and expenses incurred by Customer and its representatives in connection with
their activities under this Paragraph 7.4.1, including travel and living
expenses, shall be borne solely by Customer.

 

(g)           Correction
of Deficiencies After SPSR.  If at
any time following the SPSR for any Spacecraft, and prior to Intentional
Ignition, such Spacecraft fails to meet the Spacecraft Performance Requirements
(as may be modified or waived by Customer), Contractor shall promptly undertake
to correct such deficiencies prior to Intentional Ignition at its own cost and
expense.

 

7.4.2  Transport.  Following a successful completion of the SPSR
for each Spacecraft, Contractor shall ship such Spacecraft to its Designated
Launch Site and proceed with the further testing and Launch of the Spacecraft
and Launch Support in accordance with the Statement of Work and
Attachment 3. Contractor shall notify Customer of the IOT schedule for
each Spacecraft at least thirty (30) Days prior to the Launch of such
Spacecraft. Each IOT shall be conducted in accordance with the

 

19

 

Statement of Work and
Attachment 3, and in accordance with Article 14, Customer’s
representatives shall be permitted to observe all phases of the IOT.

 

7.4.3  Final
Acceptance.  When each IOT is
completed, Contractor shall submit to Customer the test results and shall hold
an acceptance review with Customer. At the conclusion of the acceptance review,
including the resolution of any outstanding Spacecraft performance issues,
Contractor shall deliver to Customer the final IOT report together with a
Certification of one of Contractor’s officers or the President or Senior
Executive responsible for the Contractor’s performing business unit that the
applicable Spacecraft meets the criteria for Unconditional Acceptance as
described in Paragraph 7.4.3(a) or for Conditional Acceptance as
described in Paragraph 7.4.3(b), with if necessary, an explanation of the
criteria that the Spacecraft does not meet, or that the Spacecraft is a Total
Loss or a Constructive Total Loss. Within five (5) Business Days following
receipt of such Certification, Customer shall either accept the Spacecraft in
accordance with Paragraph 7.4.3(a) or Paragraph 7.4.3(b) hereof,
or reject the Spacecraft and provide Contractor with a documented statement of
reasons for any rejection. Upon either Conditional Acceptance or Unconditional
Acceptance of the Spacecraft, Contractor shall be entitled to commence earning
its Performance Incentives, as may be adjusted, pursuant to Paragraph 5.2.

 

(a)           Unconditional
Acceptance.  Customer shall be
obligated to accept, in writing, without conditions, a Spacecraft when it has
been verified at the acceptance review that (i) the Spacecraft has
successfully passed the tests specified in the Attachment 1 and Attachment 3, (ii) it
has been verified that the Spacecraft’s Orbital Maneuver Life will be at least***,
(iii) the Spacecraft satisfies all the requirements specified in the
Spacecraft Performance Requirements, as may have been amended or modified at or
before SPSR with Customer’s written consent, and (iv) ***:

 

***, a Defect
in the Spacecraft that can be satisfactorily corrected by a switch to a
redundant unit in the Spacecraft will not be deemed to affect the Spacecraft’s
ability to meet the criteria for Unconditional Acceptance.

 

(b)           Conditional
Acceptance.  Customer shall be
obligated to accept, in writing, a Spacecraft when it has been verified at the
acceptance review that, although such Spacecraft does not meet the criteria for
Unconditional Acceptance, the Spacecraft is not a Total Loss or a Constructive
Total Loss. Upon Conditional Acceptance of a Spacecraft, the Performance
Incentives for such Spacecraft shall be adjusted in accordance with
Paragraph 5.2.

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

20

 

(c)           Total
Loss/Constructive Total Loss.  If a
Spacecraft is a Total Loss or a Constructive Total Loss prior to Acceptance and
has not been destroyed, Customer may accept such Spacecraft, or reject such
Spacecraft and direct Contractor either to dispose of the Spacecraft or to
transfer title to the Spacecraft to a third party designated by Customer.

 

7.5  Acceptance Procedures for
Other Deliverable Items

 

Acceptance of Deliverable Items specified in
Paragraph 3.1, Items 4(a) through (e) to be Delivered under the
Contract shall occur in accordance with the requirements of this
Paragraph 7.5. Contractor shall deliver test results and provide a
Certification to Customer of the results of its inspection and tests of all
such Deliverable Items in a form acceptable to Customer. Based upon this
Certification, upon which Customer shall be entitled to rely, and any
inspection or testing that Customer may conduct, upon Delivery, Customer shall
either accept the Deliverable Item(s) in writing or notify Contractor in
writing of those particulars in which the Deliverable Items are unacceptable.
Should Customer fail to notify Contractor in writing of those particulars in
which the Deliverable Items are unacceptable within ten (10) Business Days
of Delivery, the Deliverable Items shall be deemed accepted by Customer. Upon
receipt of a notice that any Deliverable Item is unacceptable to Customer,
which notice shall state the particulars relating to such unacceptability,
Contractor shall remedy such Deliverable Item. Upon Customer’s satisfaction
that such particulars have been remedied to conform to all applicable
requirements of this Contract, the Deliverable Item shall be accepted by
Customer in writing. 

 

7.6  Remedy of Defects

 

Remedy of any Defects in a Deliverable Item
including the Spacecraft, but only prior to Launch, shall be accomplished by
Contractor at its expense, promptly upon receipt of notice thereof. Contractor
and Customer shall mutually agree on the level of retest of the Deliverable
Item (together with any other potentially affected parts or systems) or an
appropriate analysis, reasonably necessary to demonstrate that the Defects have
been corrected and meet the requirements of the Contract.

 

7.7  Post Launch Remedies

 

After Launch of a Spacecraft, and as provided
in Section 11.10 of the Statement of Work, Contractor shall fully
cooperate with Customer and Contractor shall use its best efforts at Customer’s
reasonable request under the circumstances, to investigate and assist Customer,***,
in conducting anomaly investigations and make recommendations for potential
corrective action (including, without limitation, through changes in
operational procedures, software, or, where possible, Spacecraft

 

***         Certain confidential portions of this exhibit
were omitted by means of redacting a portion of the text. Copies of the exhibit
containing the redacted portions have been filed separately with the Securities
and Exchange Commission subject to a request for confidential treatment
pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.

 

21

 

configurations) until ***. If,
due to a Launch Vehicle anomaly or other cause not attributable to Contractor,
a Spacecraft is declared a Total Loss or a Constructive Total Loss, then
Contractor shall be entitled to earn the Performance Incentives to the extent
provided in Paragraph 5.2 related to such Spacecraft, which may be
pre-paid by Customer.*** In the instance where Customer has self insured for
Total Loss and/or Constructive Total loss of the Spacecraft due to a Launch
Vehicle anomaly or other cause not attributable to Contractor, Customer and
Contractor, at Customer’s request, shall negotiate a reasonable period for
payment of Performance Incentives under Paragraph 5.2, subject to the same
assurances and terms specified in Paragraph 5.1.2.

 

***

 

8.             LAUNCH
VEHICLE SELECTION

 

8.1  Customer Responsibility.

 

Customer is responsible for providing a
Launch Vehicle for each Spacecraft Launch and shall advise Contractor *** prior
to each scheduled Launch of the selected Designated Launch Agency and Launch
Vehicle. Customer shall enter into all Launch Agreements directly with the
applicable Designated Launch Agencies. *** Prior to the SPSR for each
Spacecraft, Customer may elect to change the Launch Vehicle for such Spacecraft
and any additional costs of Contractor resulting from such change shall be
subject to a change notice under Article 12.

 

8.2  Launch
Vehicle Availability Date.

 

Customer shall be responsible to make the
Launch Vehicle for each Spacecraft available for Contractor to begin operations
at the Designated Launch Site and to Launch in accordance with the schedule set
forth below. Failure to provide such Launch Vehicles by these dates, and, once
launch operations begin, delays that are attributable to the Designated Launch
Agency, except for circumstances attributable to the Contractor, will result in
excusable delays under Article 19.

 

***

 

9.             INSURANCE

 

9.1  Launch and On-Orbit
Insurance

 

The Contractor shall support the Customer
with all reasonably necessary presentations (oral, written, or otherwise) and
provide all reasonably necessary technical information for the purpose of the
Customer purchasing insurance directly from the space insurance industry. The Contractor
agrees to provide the information,

 

***         Certain confidential portions of this exhibit
were omitted by means of redacting a portion of the text. Copies of the exhibit
containing the redacted portions have been filed separately with the Securities
and Exchange Commission subject to a request for confidential treatment
pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.

 

22

 

subject to obtaining any
necessary approvals under the Export Laws, to Customer consistent with the
requisite insurance meeting dates.***

 

9.2  Insurance Claims

 

In the event of a total or partial Launch
failure or a total or partial failure of the Spacecraft in orbit, Contractor
shall cooperate with Customer and the applicable insurance brokers and
underwriters, in connection with the investigation, preparation, filing and
administration of any insurance claim pertaining to such Launch or Spacecraft
failure.***

 

9.3  “Work-in-Progress” Insurance

 

At all times prior to Launch of a Spacecraft,
Contractor shall maintain*** an insurance policy or policies***, which policy
or policies shall name Customer as an additional loss payee, with payment under
the policy to become due in the event the Spacecraft is damaged or destroyed
such that Customer will have the right to terminate Contract with respect to
the damaged Spacecraft. Contractor shall provide Customer with a certificate of
insurance within thirty (30) Days after receipt of a written request from
Customer.

 

Customer will
pass through to the Contractor any third-party launch liability insurance
provided for the benefit of the Contractor by each Designated Launch Agency, in
accordance with the Commercial Space Launch Act and the applicable Launch
license for Launches occurring in the United States, or in accordance with the
amount of liability insurance required by any foreign government in the country
of Launch. Customer will use best reasonable efforts to assure that the Launch
Vehicle provider adds the Contractor as an additional insured to the applicable
launch liability insurance policy prior to Launch of each Spacecraft.

 

10.          SUBCONTRACTS

 

10.1  Subcontracts

 

Within ninety (90) Days after the
Effective Date of Contract, Contractor shall provide a list of all Subcontracts
with a value in excess of Five Hundred Thousand Dollars ($500,000) per
Spacecraft and shall identify the work to be provided in each such Subcontract.
Changes to this list shall be detailed in each quarterly report, to be provided
by Contractor pursuant to the Statement of Work. Contractor shall supply to
Customer copies of all Subcontracts with Major Subcontractors, which are placed
specifically for each Spacecraft. Contractor shall ensure that all Subcontracts
will permit Contractor to perform its obligations under this Contract,
including meeting all Promised Delivery Dates.

 

***         Certain confidential portions of this exhibit
were omitted by means of redacting a portion of the text. Copies of the exhibit
containing the redacted portions have been filed separately with the Securities
and Exchange Commission subject to a request for confidential treatment
pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.

 

23

 

10.2  Key
Subcontracts

 

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

 

	
  Suppliers

  	
   

  	
  Item

  	
   

  
	
  ***

  	
   

  	
   

  	
   

  

 

10.3  Indemnification/Release

 

Contractor shall ensure that all
Subcontractors release Customer from any claims arising under any Subcontract
or otherwise in connection with this Contract. Contractor shall indemnify,
defend and hold harmless Customer from and against all claims made by any
Subcontractor against Customer.

 

11.          PROPERTY
ACCOUNTING

 

11.1  Identification and Control

 

Contractor shall be directly responsible for
and accountable for all supplies, parts, materials, components, subsystems or
systems (whether in its possession or the possession of any of its
Subcontractors) which are to become the property of Customer pursuant to the
terms of this Contract, and which are part of the Deliverable Items to be
Delivered under this Contract. For this purpose, Contractor shall (i) use
commercially reasonable efforts to protect and preserve all of the Customer’s
Deliverable Items until Acceptance under this Contract and (ii) establish
and maintain a system to control and identify, at all times and until the
Delivery and Acceptance of the last Deliverable Item to be delivered hereunder,
all of the aforementioned property in its possession or the possession of its
Subcontractors.

 

11.2  Use of
Inventory Parts/Use of Customer’s
Parts

 

*** To the extent that Contractor uses any
parts or components from its inventory such parts and components shall meet the
reliability standards set forth in the Spacecraft Product Assurance
Requirements. Any failures or anomalies on such items shall be reviewed and
consented to by Customer.

 

***         Certain confidential portions of this exhibit
were omitted by means of redacting a portion of the text. Copies of the exhibit
containing the redacted portions have been filed separately with the Securities
and Exchange Commission subject to a request for confidential treatment
pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.

 

24

 

12.          CHANGES
REQUESTED BY CONTRACTOR OR CUSTOMER

 

12.1  Contract Change Notice

 

Any changes requested during the performance
of this Contract which will add or delete Work, affect the design of any
Spacecraft before its Delivery, change the method of shipment or packing, or
place or time of any Delivery, or will affect any other requirement of this
Contract, whether proposed by Contractor or Customer, shall be reflected by
Contractor in writing as a contract change notice in accordance with the
Statement of Work (“Contract Change Notice”) issued at least thirty
(30) Days prior to the proposed date of the change except for such shorter
periods mutually agreed upon by the Parties which are reasonably necessary
under the circumstances. If Customer requests a change, Contractor shall submit
the Contract Change Notice within thirty (30) Days of Customer’s request.
The time periods specified in this Article and in the Statement of Work
for proposing and approving changes may be shortened as necessary by mutual
agreement to accommodate exigent circumstances.

 

12.2  Acceptance of Change

 

Customer shall notify Contractor as soon as
practicable under the circumstances after receipt of a Contract Change Notice
whether or not it agrees with and accepts such change. If Customer agrees with
and accepts the change in writing, Contractor shall proceed with the performance
of the Contract as changed and an amendment to the Contract reflecting such
change, and price adjustment and schedule adjustment, if any, shall be
issued. If Customer does not agree to implement the change or the Parties are
unable to reach any other agreement regarding such change, Contractor shall
proceed with the performance of the Contract, as unchanged.

 

12.3  Non Refusal

 

Contractor may not refuse any change that may
be requested by Customer during the performance of this Contract as long as the
Customer-requested change is within the general scope of this Contract and is
technically feasible utilizing existing and reasonably available technology,
and Customer agrees to the price adjustment and schedule adjustment, if
any, proposed by Contractor in accordance with Paragraph 12.4.

 

12.4  Price of Changes

 

***

 

12.5  Changes To
Meet Specifications

 

***

 

***         Certain confidential portions of this exhibit
were omitted by means of redacting a portion of the text. Copies of the exhibit
containing the redacted portions have been filed separately with the Securities
and Exchange Commission subject to a request for confidential treatment
pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.

 

25

 

12.6
 Change of
Designated Orbital Position of Satellite Ka-5

 

Customer will have until EDC + six (6) months
to change the Designated Orbital Position of Rainbow Ka-5 to another Western US
orbital position between 110o West Longitude and 140o
West Longitude at no cost or schedule impact, provided the change in
orbital position does not impact the Spacecraft design other than the antenna
optimization. Spacecraft performance at the new orbital position will be as
mutually agreed by the Parties within thirty (30) Days after Customer’s
notice to make such change.

 

13.          CONTRACT TECHNOLOGY

 

13.1  Disclosure of Contract
Technology

 

For all purposes, Contractor shall become or
remain the owner of all Contract Technology. From the EDC, and during the
Orbital Maneuver Life of each Spacecraft Contractor shall retain and maintain
copies of all Contract Technology (including any Contract Foreground Data or
Contract Background Data previously delivered to Customer hereunder). During
such period Customer may, in writing, request copies of such Contract
Technology to the extent reasonably required for testing, maintaining,
operating, using or marketing capacity on or services that employ any of the
Spacecraft. Within seven (7) Days after receipt of such request,
Contractor shall furnish copies of the requested Contract Technology, subject
to governmental restrictions. If Contractor cannot supply Customer with copies
of requested Contract Technology due to governmental restrictions, Contractor
must document the applicable restrictions in writing to Customer and, at
Customer’s request, Contractor must use reasonable efforts to have such
governmental restrictions amended or waived to permit Customer to obtain copies
of requested Contract Technology at Customer’s cost and expense. The cost of
furnishing copies of such Contract Technology shall be borne by the Customer
and shall include the cost of collecting, editing, duplicating, assembling and
shipping, to the extent not included in the Spacecraft System Price, but shall
not include any amount associated with the value of such Contract Technology.
Contractor may, by appropriate marking on Contract Technology, indicate that
such shall be used only in accordance with the terms of this Contract,
including restrictions contained herein on the use and disclosure of
Deliverable Data. Notwithstanding anything to the contrary in this
Paragraph 13.1, “Disclosure of Contract Technology”, in the event Customer’s
request includes Contract Technology comprising software in source code format,
Contractor shall not be obligated to furnish copies of such software in source
code format, but instead shall be obligated to provide, subject to governmental
restrictions, Customer access only to such software in source code format owned
by Contractor, at Contractor’s facility, provided that Customer shall not have
the right to disclose to any third party or to reproduce, or copy, in whole or
in part, any such software in source code format, and use of such software in
source code format by Customer shall be solely in connection with testing,
maintaining, operating, using or marketing capacity on or services that employ
any of the Spacecraft, to the extent required. In the event Customer requests
software in source code format that has been licensed to Contractor by a third
party software licensor, Contractor shall only be required to use reasonable

 

26

 

efforts to obtain from such
third party software licensor such software in source code format.

 

13.2  Rights Granted in Contract Technology

 

13.2.1  Contract
Foreground Data and Contract Background Data.  Subject to Article 13.1, “Disclosure of
Contract Technology,” Contractor hereby grants to Customer (a) an
irrevocable, non-exclusive, royalty free, worldwide Right to Use Contract
Foreground Data in connection with testing, maintaining, operating, using, and
marketing capacity on or services that employ any of the Spacecraft, (b) an
irrevocable (except upon termination of this Contract under Articles 17 and
18), non-exclusive, royalty free, worldwide Right to Use Contract Background
Data solely in connection with testing, maintaining, operating, using, and
marketing capacity on or services that employ any of the Spacecraft, and (c) the
right to reproduce (together with all copyright and other restrictive markings)
and disclose to customers and potential customers of Customer reasonably
selected portions of the Deliverable Data and Spacecraft Performance
Requirements for the purpose of marketing capacity and services on any of the
Spacecraft, provided that such customers and potential customers agree to be
bound by restrictions contained herein on the use and disclosure of Deliverable
Data. In no event shall Customer disclose, distribute, transfer, or otherwise
provide Contract Foreground Data, Contract Background Data, Deliverable Data or
Spacecraft Performance Requirements, in whole or in part, to any entity in the
business of designing and/or manufacturing spacecraft.

 

13.2.2  Contract
Intellectual Property.  For all
Contract Intellectual Property owned by Contractor or under which Contractor
has rights, Contractor hereby grants to Customer an irrevocable, non-exclusive,
royalty free, worldwide License to Practice under such Contract Intellectual
Property solely in connection with testing, maintaining, operating, using, and
marketing capacity on or services that employ any of the Spacecraft. With
respect to Contractor’s trademarks, trademark applications, and all
registrations and recordings thereof (“trademarks”), Customer agrees that any
use of such trademarks by Customer shall be in a manner consistent with
Contractor’s uses thereof and any such use by Customer of the trademarks shall
inure to the benefit of Contractor.

 

13.3  ***

 

13.3.1  Segregation of Contract Technology.  Unless otherwise required in this Article 13,
as of EDC and throughout the Orbital Maneuver Life of each Spacecraft,
Contractor agrees to maintain all Contract Technology at Contractor’s
facilities and to keep such Contract Technology updated and current throughout
the Orbital Maneuver Life of each Spacecraft. Customer may, upon reasonable
request to Contractor, access the area where the Contract Technology is
maintained for the purposes of ascertaining compliance with this
Paragraph 13.3.1.

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

27

 

13.3.2  ***

 

13.3.3 
Representations. 
Contractor represents, warrants and covenants that the Contract
Technology kept at Contractor’s facilities ***:

 

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

 

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

 

(c)           Form.  will be in a form suitable for reproduction
by Customer.

 

***

 

14.          RIGHT
OF ACCESS, REPORTS, TESTING, MONITORING

 

14.1  Access

 

Customer shall have the access rights
specified below and as described in the Statement of Work:

 

14.1.1  Work.  (i) In accordance with Article 27
Confidentiality, (ii) within normal business hours, (iii) accompanied
by Contractor’s personnel (except to the extent Contractor’s accompaniment is
not required for Contractor’s other commercial US customers), and (iv) on
a non-interference basis, Customer, and its representatives and consultants
that are not employees of a satellite manufacturer in direct competition with
Contractor, shall be allowed access to all Work and Work in progress, and all
data and information related to this Contract (including without limitation the
data and information specified in the Statement of Work and Attachment 3),
including all Major or Key Subcontractors (and other Subcontractors with such
Subcontractors consent which, at the request of the Customer, the Contractor
shall use its best commercial efforts to obtain), and all facilities therefore,
subject to governmental restrictions, for purposes of observation, inspection,
examination and evaluation of the Work, at any reasonable time prior to
Acceptance of the relevant Deliverable Item and thereafter to the extent such
data and information are of the type customarily retained in the ordinary
course of business. If Customer and /or its representatives and/or its
consultants are denied access as set forth herein due to governmental
restrictions, Contractor shall document in writing such governmental restrictions
and, at Customer request, use best commercial efforts to amend or remove such
governmental restrictions to access. Customer’s and its representatives’
personnel visiting or resident at Contractor’s or any Subcontractor’s
facilities shall abide by the applicable security and safety regulations,

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

28

 

provided that reasonable notice
of any such regulations is provided by Contractor or Subcontractor, as
applicable, and any such access shall not interfere with normal business
operations of Contractor or Subcontractor, as applicable.

 

14.1.2  Program
Review Meetings.  Customer and
its representatives shall be given reasonable notice of and be entitled to
attend all Program Review Meetings of the Contractor as specified in the
Statement of Work

 

14.1.3  Major/Key
Subcontracts.  Contractor will
ensure that all of the Major and Key Subcontracts for items specific to the Spacecraft
contain provisions providing access rights to Customer to the subject matter of
the Subcontract to the same extent as access is provided hereunder, subject to
governmental restrictions. If governmental restrictions prevent Customer
access, Contractor shall provide Customer with a written explanation of the
governmental restrictions and, if requested by Customer, shall its best
commercial efforts to assist Subcontractor with amending or removing such
governmental restrictions. With respect to all other Subcontracts, Contractor
shall use reasonable efforts to ensure that Customer has access to the
applicable Subcontractor’s Work, as required hereunder.

 

14.1.4  Customer
Employees.  Notwithstanding
the fact that Customer’s or its representatives’ personnel resident at the
Contractor’s or any Subcontractors’ facility will be in consultation with the
Contractor’s or Subcontractors’ (as applicable) personnel, they shall remain
employees of Customer, or its representatives (as applicable), and as such,
compensation for their services and all related expenses remains the
responsibility of Customer or its representatives (as applicable).

 

14.2  Reports

 

Contractor shall deliver to Customer written
progress and status reports, test data, and any final reports, in accordance
with the requirements of Attachment 1 and Attachment 3. All reports furnished
pursuant to this Paragraph may be used and distributed by Customer in
accordance with the provisions of this Contract.

 

14.3  Performance Testing

 

Customer and its representatives and
consultants shall have the rights with respect to testing set forth below and,
in Attachment 1, Attachment 3 and Attachment 5 on a non-interference basis and
accompanied by Contractor’s representatives:

 

14.3.1  Witness of
Tests.  Customer, through its
representatives and consultants, shall have the right to witness all
developmental, qualification, protoflight and acceptance testing of Deliverable
Items required by this Contract at Contractor’s or a Key or Major Subcontractor’s
plant and other Subcontractors with such Subcontractors consent which, at the
request of the Customer, Contractor shall use best commercial efforts to obtain
or at such other place as the tests are conducted or test results are
monitored, and Customer shall be provided with copies of all test results. If
governmental restrictions prohibit the witness of such testing, Contractor
shall provide Customer with written documentation of the applicable
governmental restrictions and, if

 

29

 

requested by Customer, shall
use its best commercial efforts to amend or remove any such restrictions.

 

14.3.2  TT&C
Station Equipment Satellite Simulators Acceptance Tests.  Customer shall have the right reasonably to
specify the times and places for the undertaking of final acceptance testing of
the TT&C Station Equipment and the Satellite Simulators set out in
Paragraph 3.1 Deliverable Items 4(a) and 4(c).

 

14.3.3  Notice of
Tests.  If Contractor or any
Subcontractor establishes the time, date, or location of any major system or
subsystem or any units requiring qualification testing required under this
Contract, Contractor shall provide, or cause the Subcontractor to provide,
Customer with the advance notice specified in this Contract, or if not
specified, with reasonable advance notice, which in the case of units requiring
qualification shall be no less than seven (7) Days prior to the scheduled
test.

 

14.3.4  Spacecraft
and Ground Station Test Plan. 
All testing of a Spacecraft and other Deliverable Items under this
Contract shall be undertaken in accordance with the Statement of Work,
Attachment 3 and Attachment 5.

 

14.4  Monitoring

 

Approximately six (6) of Customer’s
representatives or consultants shall be located at the manufacturing site of
the Spacecraft for the purpose of monitoring the progress of the Work as
specified in the Statement of Work. Contractor shall provide office and other
facilities to such representatives as described in the Statement of Work. In
addition, Contractor shall provide adequate parking spaces for Customer on-site
representatives. Customer personnel and representatives shall have twenty-four
(24) -hour access to the office space provided hereunder.

 

14.5  Export Laws Compliance

 

14.5.1  General. 
Notwithstanding any provision of this Contract, any obligation of
Contractor hereunder to provide hardware, software, Deliverable Data, other
technical information or technical services, or access to Contractor’s or
Subcontractors’ facilities to Customer, its employees, representatives,
consultants or agents shall be subject to applicable Export Laws. The Parties
shall work cooperatively and in good faith to implement this Contract in
compliance with such Export Laws.

 

14.5.2  Compliance
Program.  Contractor shall promptly
implement the Export Laws Compliance Program described in Attachment 9 to
obtain and maintain all authorizations and consents under the Export Laws
necessary to permit Customer to take Delivery of all Deliverable Items and to
permit Customer, the Designated Launch Agencies, the insurance brokers and
underwriters, the Customer’s consultants or other third parties with a need to
access information supplied by Contractor under any of the provisions of the
Contract, and their respective personnel, agents and consultants, to have
access to the Work, reports, testing and monitoring and information, documents
and data related thereto, as specified in this Contract. To the extent that
Customer, the Designated Launch Agencies, the insurance brokers and underwriters,
the Customer’s consultants or other third parties with a need to access
information supplied by

 

30

 

Contractor under any of the provisions of the Contract is denied access
to any Deliverable Items, Work, reports, testing and monitoring and any
documentation and data related thereto, Contractor represents that all of the
foregoing shall be consistent with the requirements of this Contract and the
best practices of the spacecraft manufacturing industry.

 

14.5.3 
RE-EXPORT.  CUSTOMER UNDERSTANDS AND WARRANTS THAT IT
SHALL NOT RE-EXPORT, RE-TRANSFER OR DIVERT TO ANY THIRD PARTY ANY U.S. ORIGIN
ITEM THAT IS REGULATED BY THE U.S. MUNITIONS LIST (UML) AND PROVIDED TO
CUSTOMER UNDER OR IN CONNECTION WITH THIS CONTRACT, EXCEPT AS EXPRESSLY
AUTHORIZED BY THE U.S. GOVERNMENT IN ACCORDANCE WITH THE EXPORT LAWS.

 

15.          WARRANTY

 

15.1  Spacecraft Warranty

 

Contractor warrants that each Spacecraft
shall be in good working order and free of Defects in design, materials and
workmanship and shall conform to requirements of this Contract, including the
Spacecraft Performance Requirements, as may be modified by any approved waivers
or deviations pursuant to Paragraph 7.2. The above warranty on each
Spacecraft shall end upon Launch of the Spacecraft. Contractor’s only liability
under the warranty shall be as and to the extent that prior to Launch of the
Spacecraft, if the Spacecraft fails to meet the requirements of this Contract,
including the Spacecraft Performance Requirements, as may be modified by any
approved waivers or deviations pursuant to Paragraph 7.2, Contractor shall
promptly undertake to correct such deficiencies, in the manner determined by
Contractor’s best technical judgment, at its own cost and expense. In the event
a Spacecraft is to be delivered to storage, Contractor warrants that the
Spacecraft shall be in good working order and free of Defects in design, materials
and/or workmanship and conform to the requirements of this Contract, including
the Spacecraft Performance Requirements, as may be modified by any approved
waivers or deviations pursuant to Paragraph 7.2, for***. Contractor’s only
liability under the preceding sentence shall be as and to the extent that
during the warranty period (as defined in the preceding sentence), if the
Spacecraft fails to meet the requirements of this Contract, including the
Spacecraft Performance Requirements, Contractor shall promptly undertake to
correct such deficiencies, in the manner determined by Contractor’s best
technical judgment, at its own cost and expense.

 

15.2  Warranty for Deliverable
Items Other Than Spacecraft 

 

Contractor warrants that Deliverable Items
other than Spacecraft shall be in good working order and free of Defects in
design, material and workmanship and shall conform to the applicable
requirements of this Contract, including applicable

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under
the Securities Exchange Act of 1934.

 

31

 

specifications, as modified by any waivers granted by Customer
hereunder ***. Customer shall have the right, at any time during the warranty
period specified above and irrespective of prior inspections or acceptances, to
require correction of any Defect occurring to any Deliverable Item other than
the Spacecraft, including any integrated software or services not conforming to
the requirements herein and require that Contractor, at its expense, correct or
replace (at Contractor’s option) such non-conforming Deliverable Item to make
such Deliverable Item, including integrated software, conforming. If Contractor
fails to correct or replace such defective Deliverable Item other than the
Spacecraft, including integrated software, within a reasonable period after
notification from Customer, Customer may, by contract or otherwise, correct or
replace such defective Deliverable Item, including integrated software, and
Contractor shall reimburse Customer for such correction or replacement,
provided that Customer provides Contractor with documentation related to the
repair or replacement.*** 

 

15.3 
Disclaimer

 

EXCEPT AND TO THE EXTENT EXPRESSLY PROVIDED
IN THIS CONTRACT, CONTRACTOR DISCLAIMS ANY OTHER WARRANTY, WHETHER EXPRESS OR
IMPLIED, INCLUDING WITHOUT LIMITATION, ANY WARRANTY OF SUITABILITY OR
MERCHANTABILITY OR FITNESS FOR USE OR FOR A PARTICULAR PURPOSE, WITH REGARD TO
ANY SPACECRAFT OR ANY OTHER DELIVERABLE ITEM 

 

15.4 
Assistance

 

In addition to the warranty provisions of
this 15, Contractor agrees to provide reasonable support including, but not
limited to, the support of Subcontractors, to Customer, at no cost to Customer
in attending to, assisting in diagnosing and recommending corrective action for
any Spacecraft failure or any other anomaly occurring with or on any Spacecraft
during the Service Life and for as long thereafter as the Contractor receives
Performance Incentives in accordance with Paragraph 5.2 hereof. Contractor
specifically acknowledges that its obligation pursuant to this Paragraph shall
continue during the entire Service Life of a Spacecraft, whether or not
Contractor is earning Performance Incentives pursuant to Paragraph 5.2.
Contractor shall be compensated on a reasonable time and material basis for any
assistance given hereunder with respect to a Spacecraft operating in excess of
the Service Life, but only if Contractor is not receiving Performance
Incentives with respect to such Spacecraft.

 

16.          DEFICIENCIES
NOTED IN OTHER SPACECRAFT

 

16.1  Qualification Heritage 

 

Contractor represents and warrants that,
except for items qualified but not flown, in process qualifications, and
qualifications for this program ***, each and every unit,

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under
the Securities Exchange Act of 1934.

 

32

 

system, subsystem and process to be employed on or used in connection
with each of the Spacecraft and associated Deliverable Hardware and software
(which shall not be changed without Customer’s express written consent) has
been employed on, or used in connection with, at least one (1) in-orbit
spacecraft and that, whether on a Rainbow or other spacecraft, has (to
Contractor’s knowledge) experienced no in-orbit or unresolved ground test
anomalies,***, which, in each case, have been remedied for future spacecraft,
including the Spacecraft, or determined to be isolated to the particular
spacecraft as to which the anomaly was identified, in each case as reasonably
and fairly summarized in writing to Customer in Attachment 14 attached hereto. 

 

16.2 
Notice 

 

Whether before or after Acceptance of any
Spacecraft, Contractor shall promptly notify Customer of any circumstance,
known to Contractor, or identified by Contractor or Customer, and determined
and documented by Contractor to be relevant to such Spacecraft, that would make
any statement set forth in Paragraph 16.1, if made at the time, no longer
correct and /or complete, and of any other data available to it that indicates (i) that
conditions exist which affect or may affect adversely the Spacecraft operation,
or (ii) that the Spacecraft performance and/or operation depart or may
depart from that expected from the program documentation at any time during the
period of the Spacecraft’s Service Life, or (iii) that the Spacecraft does
not meet all the requirements of the Spacecraft Performance Requirements, or
cannot be reasonably predicted to be able to meet the *** (v) that any
other parameter of an in-orbit spacecraft of similar design to the Spacecraft
is trending towards its design limit prematurely. Contractor shall take
appropriate corrective measures at its sole cost if the Spacecraft has not been
Launched so as to eliminate, all deficiencies that the Spacecraft conforms to
all applicable requirements of this Contract. If the Spacecraft has been
Launched, Contractor shall, on a commercially reasonable efforts basis,
recommend whatever reasonable corrective measures are available to it (including
software changes, changes to operational procedures and any other ground-based
solutions) *** so as to eliminate or ameliorate the effect of the deficiencies
(unless the Parties mutually determine that correcting or bypassing a
malfunction or anomaly in the Spacecraft software will harm the operation of
the Spacecraft). Customer shall have the right to reject, until SPSR any
Spacecraft that does not meet the requirements of this 16 and Customer shall
have the right to require Contractor to remedy any malfunction or anomaly until
Launch of the Spacecraft. Thereafter, Customer’s obligations to complete
Delivery and Acceptance of the Spacecraft shall be governed by other provisions
of this Contract.

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under
the Securities Exchange Act of 1934.

 

33

 

17.          TERMINATION
FOR CONVENIENCE

 

17.1  Termination

 

17.1.1  General.  Customer may, prior to Contractor’s
completion of all Work, by written notice issued by Customer’s Authorized
Representative, terminate this Contract in whole, or in part (except for a
Spacecraft after Launch and for any Deliverable Items for which Delivery and
Acceptance have been completed), for its convenience, whereupon Contractor
shall cease Work in accordance with the terms of said notice.

 

*** 

 

17.2  Termination Expense 

 

***

 

17.3 
Termination Charges 

 

***

 

17.4 
Subcontractor Settlements 

 

Contractor shall advise Customer of all
proposed settlements with vendors and Subcontractors in the event of
termination, and shall provide to Customer the terms of the settlement,
including a reference to the contractual provision relied upon to support such
termination settlement. 

 

17.5 
Inventory

 

*** 

 

17.6  Subcontracts 

 

Contractor shall place in any Major/Key
Subcontracts entered into after EDC terms that will enable the Contractor to
terminate such Subcontracts in the same or similar manner as set forth in this
17.6.

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under
the Securities Exchange Act of 1934.

 

34

 

17.7  ***

 

18.          TERMINATION
FOR CAUSE

 

18.1  Termination by Customer

 

Termination.  Customer may, by written notice issued by
Customer’s Authorized Representative, terminate this Contract with respect to
any Spacecraft (unless it has been Launched) and/or with respect to other
Deliverable Items (except for any Deliverable Items for which Delivery and
Acceptance have been completed), if:

 

(a)   ***

 

(b)   ***

 

(c)   Intentionally
omitted;

 

(d)   ***

 

(e)   ***

 

(f)    ***

 

18.1.2  Consequences of Termination. 
***

 

18.1.3  Launch Vehicle.  ***

 

18.1.4  Ownership of Work.  Upon receipt by Customer of the amounts
specified above, Contractor shall be the owner of all Work terminated, and
Customer shall return or destroy all Contract Technology and/or Deliverable
Data related to the terminated Deliverable Items. The rights and remedies of
Customer provided in this Paragraph 18.1 are the sole and exclusive remedy
to Customer for Customer’s termination for cause hereunder. 

 

18.2 
Improper Termination 

 

If, after termination under the provisions of
Paragraph 18.1, it is determined for any reason that the Contract was
terminated without cause under the provisions of this Article, the rights and
obligations of the Parties shall be the same as if termination had been
effected pursuant to 17.

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 26b-2 under
the Securities Exchange Act of 1934.

 

35

 

18.3  Termination by Contractor

 

18.3.1  Non-Payment.  Contractor may, by written notice issued by
Contractor’s Authorized Representative, terminate this Contract with respect to
a particular Spacecraft or other Deliverable Item (except for any Deliverable
Items for which Delivery and Acceptance have been completed and paid for by
Customer) if Customer has failed to make any payment applicable to such
particular Spacecraft or other Deliverable Item within thirty (30) Days of
the Payment Due Date in accordance with the Milestone Payment Plan and such
failure is not cured within a period of an additional thirty (30) Days
after notice of such failure is given by Contractor. Notwithstanding the
foregoing, amounts which are disputed in good faith shall not be justification
for Contractor to terminate this Contract pursuant to this
Paragraph 18.3.1, provided any undisputed portion is paid within the time
period required. If a termination occurs under this Paragraph 18.3.1,
Contractor shall be entitled to immediately stop Work on the terminated item
under this Contract and shall be entitled to a settlement calculated pursuant
to 17. This Paragraph shall not be applicable where Contractor has required
that an irrevocable standby Letter of Credit be established in favor of
Contractor under Paragraph 5.1.2. In such instance, the requirements of
Paragraph 5.1.2 shall take precedence.

 

18.3.2  Letter of Credit.  In the event Customer fails to maintain any
required Letter of Credit, or replenish the amount available for draw under the
Letter of Credit in accordance with the terms of Paragraphs 5.1.2(b) and (c) of
the Contract, or in the event that Contractor has not been able to collect
under the Letter of Credit any payment not received by its Payment Due Date and
such late payment has not been remedied within thirty (30) Days of
Contractor’s notice of a Letter of Credit deficiency described above, the
Contractor shall be entitled to terminate this Contract and shall treat the
termination as having issued under Article 17.

 

19.          EXCUSABLE
DELAYS

 

Delays in Delivery resulting from acts of God or of the public enemy,
acts of a government in its sovereign capacity, natural disasters, earthquake,
fires, floods, riots, strikes, lock-outs (excluding strikes or lock-outs at
Contractor owned or operated facilities), epidemics, blockades, quarantine
restrictions and embargoes, acts of terrorism, launcher unavailability,
declared war, civil insurrection, or work stoppage by Contractor under
Paragraph 5.6.2 provided in every case such acts or occurrences are without
the fault or negligence of or result from the actions or inactions of
Contractor and its Subcontractors, shall constitute excusable delays if a
written claim thereof together with information sufficient to support such
claim is received by Customer within ten (10) Business Days after the
Contractor reasonably determines that the act or occurrence may delay Delivery.
Contractor shall provide written evidence of the period of such delay.
Contractor shall use reasonable commercial efforts to minimize the effect of
any force majeure delay through the use of any work-around solution, including
to the extent appropriate but without limitation, through the use of
work-around schedules, twenty-four (24)-hour operations, and through the use of
alternative suppliers (to be approved by Customer where required under 10). The
Delivery

 

36

 

requirements shall be extended by the amount of such period as is
supported by the evidence provided;***.

 

20.          KEY
PERSONNEL

 

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

 

Key Personnel 
***  Position

 

In the event one (1) or more of the above-named personnel are no
longer available for the performance of this Contract, Contractor agrees to
replace such personnel, after consultation with Customer, with personnel of a
comparable level of experience, qualifications and ability.

 

21.          DISPUTES

 

21.1  Notice 

 

If, during the course of performance of the
Contract, either Party has cause to believe that the other Party’s performance,
or plan for performance, is such that the obligations of the other Party, as
stated in this Contract will not be met, the Party shall give written notice of
its objections and the reasons therefore and may recommend corrective action by
the other Party. The Contractor’s Program Manager shall consult with Customer’s
Program Manager in an effort to reach an agreement to overcome the objections
(first instance).

 

21.2   Escalation 

 

In the event that an agreement cannot be
reached within ten (10) Business Days of receipt of written notice, then
either Party may request, within a further period of two (2) Business
Days, that the dispute be escalated and the respective positions of the Parties
shall be forwarded to the Contractor’s Vice-President, and Customer’s
equivalent Vice-President, for discussion, and an attempt shall be made to
reach agreement to overcome the objections (second instance).

 

21.3  Further Escalation

 

In the event that agreement cannot be reached
in the second instance within twenty (20) Business Days, then either Party
may request within a further period of two (2) Business Days, that the
dispute be escalated and the positions of the Parties shall be forwarded to
Customer’s President and the President of Lockheed Martin

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under
the Securities Exchange Act of 1934.

 

37

 

Commercial Space Systems for resolution of the objections (third
instance). If agreement still cannot be reached within ten (10) Business
Days, either Party may invoke Paragraph 21.4.

 

Notwithstanding the timing requirements specified above nothing shall
preclude a Party from seeking immediate injunctive relief in situations it
deems appropriate.

 

21.4  Litigation 

 

Each of the Parties hereto hereby irrevocably
and unconditionally consents to submit to the exclusive jurisdiction of the
courts of the State of New York and of the United States of America, in each case
having jurisdiction over the County of New York, for any litigation arising out
of or relating to this Contract and the transactions contemplated hereby (and
agrees not to commence any litigation relating thereto except in such courts
unless such courts shall have declined to exercise jurisdiction). Each of the
Parties hereto hereby irrevocably and unconditionally waives any objection to
the laying of venue of any litigation arising out of this Contract or the
transactions contemplated hereby in the courts of the State of New York or the
United States of America, in each case having jurisdiction over the County of
New York, and hereby further irrevocably and unconditionally waives and agrees
not to plead or claim in any such court that any such litigation brought in any
such court has been brought in an inconvenient or improper forum.

 

21.5  Other Remedies 

 

The Parties acknowledge and agree that except
for failure(s) of Contractor that are excusable under Article 19, Customer
is entitled to pursue any equitable rights and remedies that are available in
connection with Contractor’s failure to satisfy its obligations in accordance
with the terms and conditions of this Contract; provided Customer can meet its
burden of proof for such equitable remedies.

 

22.          INDEMNIFICATION

 

22.1  Contractor’s General
Indemnification

 

Contractor shall indemnify and hold Customer,
its officers, directors, agents, employees, owners, subsidiaries, affiliates,
successors and assigns, or any of them, harmless from any and all loss, damage,
liability or expense, resulting from damage to all property (excluding damage
to Spacecraft caused after Launch) and injuries, including death, to all
persons (natural or juridical), arising from any occurrence caused by an act or
omission of Contractor, its Subcontractors, or any of them, and Contractor
shall at its sole expense defend any claims, actions, suits and proceedings,
whether in law or equity, brought against Customer, its officers, directors,
agents, employees, owners, subsidiaries, affiliates, successors and assigns, or
any of them, on account thereof, and shall pay all expenses, including attorney’s
fees, and satisfy all judgments as may be incurred by or rendered against them,
or any of them, in connection therewith, provided Contractor is given prompt
notice of any such claim, action, suit or proceeding. Customer shall provide,
at Contractor’s written request and sole expense,

 

38

 

such assistance and information as may be reasonably provided by
Customer in connection with the defense of any such action. 

 

22.2  Customer’s General
Indemnification 

 

Customer shall indemnify and hold Contractor,
its officers, directors, agents, employees, owners, subsidiaries, affiliates,
successors and assigns, or any of them, harmless from any and all loss, damage,
liability or expense, resulting from damage to all property and injuries,
including death, to all persons (natural or juridical), arising from any
occurrence caused by an act or omission of Customer or its subcontractors, and
Customer shall at its sole expense defend any claims, actions, suits and
proceedings, whether in law or equity, brought against Contractor, its
officers, directors, agents, employees, owners, subsidiaries, affiliates, successors
and assigns, or any of them, on account thereof, and shall pay all expenses,
including attorney’s fees, and satisfy all judgments as may be incurred by or
rendered against them, or any of them, in connection therewith, provided
Customer is given prompt notice of any such claim, action, suit or proceeding.
Contractor shall provide, at Customer’s written request and sole expense, such
assistance and information as may be reasonably provided by Contractor in
connection with the defense of any such action. 

 

22.3  Contractor’s Intellectual
Property Indemnification

 

22.3.1  Indemnity.
***

 

22.3.2  Cure. ***

 

22.4  Intellectual Property Indemnification Exclusion 

 

The indemnity contained in Paragraph 3
shall not apply where Contractor can show that the infringement or alleged
infringement which is the subject of the claim in question resulted from a
modification or addition to any Deliverable Item after Acceptance which
Customer requested to be carried out by an entity, other than Contractor, or
which was carried out by Customer itself, and which, in either case, did not
arise from (i) an obligation of Contractor under the Contract; or (ii) a
specific recommendation by Contractor. In addition, Contractor shall have no
liability for any infringement to the extent arising from use of any
Deliverable Item other than as or in connection with a communications satellite
or the combination of such item or part with any other item or part not
furnished to Customer by Contractor hereunder or approved or recommended by Contractor,
unless such combination is customary in the industry.

 

Customer shall hold Contractor harmless against any expense, judgment
or loss for infringement of any patents, copyrights or trademarks, which
results from Contractor’s use of or compliance with designs, detailed
specifications (not including performance specifications) provided by Customer.
Contractor acknowledges that as at EDC none of the foregoing has been provided
by Customer to Contractor.

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under
the Securities Exchange Act of 1934.

 

39

 

22.5  Indemnification For Taxes

 

Contractor shall assume responsibility for, and shall hold Customer
harmless from all taxes, duties, tariffs or similar charges, however
denominated, which may be required under any laws, and which become due by
reason of the performance of Work under this Contract or any Subcontract
hereunder, and shall execute and deliver such other further instruments, and
comply with such requirements of said laws, as may be necessary thereunder to
confirm and effectuate this Contract, including making of payment of any
interest or penalties related to or arising from such taxes, duties, tariffs or
other charges.

 

22.6  Procedures

 

In the event of a claim with respect to which a Party is entitled to
indemnification hereunder, such party (“Indemnified Party”) shall notify the
other party (“Indemnifying Party”) in writing as soon as practicable, but in no
event later than fifteen (15) Days after receipt of such claim; provided
that a delay in giving such notice shall not preclude the Indemnified Party
from seeking indemnification hereunder if such delay has not materially
prejudiced the Indemnifying Party’s ability to defend such claim. The Indemnifying
Party shall promptly defend such claim (by counsel of its own choosing and
reasonably satisfactory to the Indemnified Party) and the Indemnified Party
shall reasonably cooperate with the Indemnifying Party in the defense of such
claim, including the settlement of the matter on the basis stipulated by the
Indemnifying Party (with the Indemnifying Party being responsible for all costs
and expenses of such settlement and the reasonable out-of-pocket expenses
incurred by the Indemnified Party in cooperating with the Indemnifying Party),
subject to the limitations on settlement described in Paragraphs 22.6.1 and
22.6.2 below. If the Indemnifying Party, within a reasonable time after notice
of a claim, fails to defend the Indemnified Party, the Indemnified Party shall
be entitled to undertake the defense, compromise or settlement of such claim at
the expense of, for the account and at the risk of the Indemnifying Party. Upon
the assumption by the Indemnifying Party of the defense of such claim, the Indemnifying
Party may settle or compromise such claim as it sees fit; provided, however,
that anything in this Paragraph to the contrary notwithstanding:

 

22.6.1  Settlement.  If there is a reasonable probability that a
settlement or compromise of a claim may materially and adversely affect the
Indemnified Party, the Indemnifying Party shall not so settle or compromise
such claim without the consent of the Indemnified Party, which consent shall
not be unreasonably withheld; and

 

22.6.2  Counterclaim.  If the facts giving rise to indemnification
hereunder shall involve a possible claim by the Indemnified Party against a
third party, the Indemnified Party shall have the right, at its own cost and
expense to undertake the prosecution, compromise, and settlement of such claim.

 

40

 

23.          LIMITATION
OF LIABILITY

 

23.1  Limitation

 

***  NEITHER PARTY SHALL BE
LIABLE TO THE OTHER, TO ITS OFFICERS, DIRECTORS, EMPLOYEES, CONTRACTORS OR
SUBCONTRACTORS AT ANY TIER (INCLUDING SUPPLIERS OF ANY KIND), AGENTS OR
CUSTOMERS, TO ITS PERMITTED ASSIGNEES OR SUCCESSOR OWNERS OF ANY SPACECRAFT OR
OTHER DELIVERABLE ITEM OR TO ANY OTHER PERSON CLAIMING BY OR THROUGH SUCH PARTY
FOR ANY AMOUNTS REPRESENTING LOSS OF PROFITS, LOSS OF BUSINESS, OR SPECIAL,
INCIDENTAL, EXEMPLARY, CONSEQUENTIAL OR PUNITIVE DAMAGES, ARISING FROM OR
RELATING TO THE PERFORMANCE OR NONPERFORMANCE OF THIS CONTRACT OR ANY ACTS OR
OMISSIONS ASSOCIATED THEREWITH OR RELATED TO THE USE OF ANY ITEMS DELIVERED OR
SERVICES FURNISHED HEREUNDER, WHETHER THE BASIS OF SUCH LIABILITY IS BREACH OF
CONTRACT, TORT (INCLUDING NEGLIGENCE AND STRICT LIABILITY), STATUTE OR OTHER
LEGAL THEORY. THE PARTIES SHALL INDEMNIFY EACH OTHER AND HOLD EACH OTHER
HARMLESS FROM AND AGAINST ANY CLAIM ASSERTED DIRECTLY OR INDIRECTLY AGAINST IT
THAT IS WITHIN THE SCOPE OF THE FOREGOING LIMITATION OF LIABILITY AND
DISCLAIMER.

 

23.2  Exceptions.

 

The foregoing limitations of liability shall not apply to a Party’s
obligations to indemnify a third party claim pursuant to 22 or any other
provisions of this Contract relating to indemnification of a third party claim.
Additionally, the Parties acknowledge and agree that amounts set forth in this
Contract as liquidated damages amounts are not and shall not be construed to
be, consequential damages.

 

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

 

With respect to loss or damage to property, or personal injury or
death, arising out of activities at the Designated Launch Sites, both Parties, including
their respective contractors, subcontractors, directors, officers,
subsidiaries, employees, agents, suppliers and insurers, agree to be bound to
such inter-party waiver as the Designated Launch Agencies may set forth in the
Launch Agreements, provided that the waiver contains reciprocal rights for both
Parties and is substantially consistent with the standard provisions of such
Designated Launch Agencies.

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a portion
of the text. Copies of the exhibit containing the redacted portions have been
filed separately with the Securities and Exchange Commission subject to a
request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

41

 

25.          REPRESENTATIONS
AND WARRANTIES

 

25.1  Mutual Representations and Warranties

 

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

 

25.1.1  Existence.  It
is a corporation or limited liability company, duly organized and validly
existing and with the power to undertake the obligations set forth in this
Contract;

 

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

 

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

 

25.1.4  Litigation.  There
is no material litigation existing, threatened or pending against it which, if
determined adversely, might affect its ability to fulfill any of its
obligations under this Contract.

 

25.2  Contractor’s Special Representations and Warranties

 

Contractor represents, covenants and warrants to Customer that:

 

25.2.1  Contract Intellectual Property.  Contractor validly holds or is
otherwise authorized to use or incorporate into the Work all Contract
Intellectual Property; each Patent, trademark, and copyright owned by
Contractor that is part of Contract Intellectual Property is subsisting and has
not been adjudged invalid or unenforceable, in whole or in part, and to
Contractor’s best knowledge, each is validly issued or for applications, is in
proper form, not disclaimed and has been duly maintained, including the
submission of all necessary filings in accordance with the legal and
administrative requirements of the appropriate jurisdiction, and each issued
Patent and registered trademark and copyright owned by Contractor that is part
of Contract Intellectual Property is enforceable and is not subject to claims
of adverse limitations; none of the Contract Intellectual Property is, to the
best of Contractor’s knowledge as of EDC, the subject of infringement or other
violations of intellectual property protections by any third party; and all of
the Contract Intellectual Property is free from any lien, claim or other
encumbrance, including as a pledge of collateral. Contractor shall employ all
reasonable commercial efforts to retain all Contract Intellectual Property.

 

25.2.2  Contract Technology. 
As of EDC, to the best of Contractor’s knowledge, there are
no claims filed, or, threatened that any of the Contract Technology or the
practice thereof infringe or violate in any way any Patent or other
intellectual property rights of any third party. Contractor has the authority,
or will obtain the necessary rights, to grant to Customer the licenses and
rights to the Contract Technology according to the terms of this Contract.

 

42

 

26.          ASSIGNMENT

 

All the terms, covenants and conditions of this Contract shall inure to
the benefit of and be binding upon Customer’s successors and assigns and
Contractor’s successors and permitted assigns to the same extent as said terms,
covenants and conditions inure to the benefit of and are binding upon Customer
and Contractor. Neither this Contract nor any of the rights, duties, and
obligations of either Party under this Contract may be assigned or delegated
without the prior written consent of the other Party, which consent shall not
be unreasonably withheld or delayed. Any attempted assignment or delegation,
without such consent, shall be void and without effect. ***No assignment of
this Contract shall result in any change in the obligations of the assigning
Party hereunder. In the event that either Party is sold to or merged into
another entity, its responsibilities under this Contract shall not be altered
and the successor organization shall be liable for performance of such Party’s
obligations under this Contract.

 

27.          CONFIDENTIALITY

 

27.1  Identification of Proprietary Information

 

All information, in whatever form, orally or in any written or
electronic form, that has been or may be disclosed in the future by one Party
to the other in connection with this Contract shall be deemed proprietary
information, if written, if marked “proprietary” or “confidential,” or if
disclosed orally, if so stated to the receiving Party by the disclosing Party
at the time of disclosure (together “Proprietary Information”).

 

27.2  Restrictions on Use, Disclosure

 

Neither Party shall use the Proprietary Information of the other Party
except for the purpose of this Contract. Neither Party shall disclose the
Proprietary Information of the other Party except: (1) on a confidential
and need-to-know (for the purposes specified herein) basis to its employees,
agents, subcontractors, and advisors, each of whom shall be subject to
comparable restrictions of confidentiality; (2) as to information that is
already rightfully in the possession of the receiving Party through other means
and without such confidentiality restrictions; (3) as to information that
is required to be disclosed under applicable law or by a valid subpoena or
other court or governmental order, decree, regulation or rule; provided,
however, that if disclosure is required under this provision, the receiving
Party shall advise the disclosing Party of the requirement to disclose
Proprietary Information prior to such disclosure and as soon as reasonably
practicable after the receiving Party becomes aware of such required
disclosure; and further provided that upon the request of the disclosing Party,
the receiving Party agrees to cooperate in good faith and at the expense of the
disclosing Party in any reasonable and lawful actions which the disclosing
Party takes to resist such disclosure,

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

43

 

to limit the information to be disclosed or to limit the extent to
which the information so disclosed may be used or made available to third
parties; or (4) as to information that is released for public disclosure
by the disclosing Party or is otherwise available in the public domain.

 

27.3  Company Restricted Information

 

In addition to the Proprietary Information in Paragraph 27.1, and
without limitation thereto, Contractor acknowledges and agrees that all
information regarding Customer’s contemplated use of or customers for the
Spacecraft, areas of coverage, potential types of traffic or related
requirements, the performance of the, and all information that could be
revealing of the foregoing, shall be deemed Customer’s Proprietary Information
and “Company Restricted Information.” In addition to the obligations set forth
in Paragraph 27.2, Contractor agrees that its disclosure of Company
Restricted Information under Paragraph 27.2 above shall be limited to
individuals within the manufacturing division of Contractor who have no responsibility
for, or participation in, any venture in which Contractor may have any interest
that involves the provision of any satellite communications services, including
any individuals who may have dual roles.

 

27.4  Standard of
Care

 

Each Party agrees to exercise a level of care consistent with that
employed by said Party for its most highly restricted and proprietary
commercial information to ensure compliance with its obligations stated herein,
but in no event, shall less than a reasonable standard of care be employed by
each Party.

 

28.          PUBLIC
RELEASE OF INFORMATION

 

Except for public releases required by regulatory or governmental
authorities, within a reasonable time prior to the issuance by either Party of
news releases, articles, brochures, advertisements, prepared speeches and other
information releases concerning the work performed hereunder, the issuing Party
shall obtain the written approval of the other Party concerning the content and
timing of such releases. Neither Party’s approval will be unreasonably delayed
or denied.

 

29.          NOTICES
AND REPORTS, AUTHORIZED REPRESENTATIVES

 

29.1  Notices

 

All notices and reports to be provided to Customer or Contractor under
this Contract shall be in writing, in English, and sent to Customer or
Contractor at the following addresses (or to such other address as each Party
may give the other by notice to the other in accordance with this 29):

 

44

 

Customer:

RAINBOW DBS COMPANY LLC

200 Jericho Quadrangle

Jericho, New York 11753

USA

 

Attention:  ***

Telephone No.:

Fax No:

Email:

 

With a copy to:

 

Attention:  ***

Telephone No.:

Fax No:

Email:

 

Contractor:

Lockheed Martin Commercial Space Systems

100 Campus Drive

Newtown, Pennsylvania 18940

 

Attention:  ***

Telephone No.:

Fax No:

Email:

 

With a copy to:

 

Attention:  ***

Telephone No.:

Email:

 

29.2  Authorized Representatives

 

For purposes of binding each Party under
provisions of this Contract, the “Authorized Representative” of Customer shall
be ***, and the Authorized Representative of Contractor shall be ***, each of
whom shall have the authority to bind the Party they represent. Each Party may
change or add to its list of Authorized Representatives by giving notice to the
other Party (signed by the notifying Party’s then-

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

45

 

current Authorized Representative or Chief Executive Officer (or
equivalent)) pursuant to the Contract notice provisions above.

 

30.          CUSTOMER
FURNISHED INFORMATION AND PROPERTY

 

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

 

30.1  Title

 

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

 

30.2 
Risk of Loss

 

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

 

30.3 
Use

 

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

 

30.4 
Taxes

 

To the extent that any property is required
for Contractor’s completion of its obligations under the Statement of Work to
be responsible for payment of all taxes which become due by reason of
Contractor’s or any Subcontractor’s possession, control or use of such
Information and property, and to comply with all requirements of said laws,
including making payment of any interest or penalties related to or arising
from such taxes.

 

30.5 
Encumbrances

 

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

 

30.6 
Return Transportation

 

Except as may otherwise be provided in this
Contract to return Information and property sent to Contractor as required for
Contractor’s completion of its obligations under the Statement of Work upon
completion of all Work or termination of this Contract. If Customer requests
any additional Information or property to be sent or returned, Customer shall
bear any costs related to the transportation and associated insurance to
Contractor’s facilities and back to Customer.

 

***         Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text. Copies of the exhibit containing the redacted portions
have been filed separately with the Securities and Exchange Commission subject
to a request for confidential treatment pursuant to Rule 24b-2 under the
Securities Exchange Act of 1934.

 

46

 

30.7  Damages

 

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

 

31.          HAZARDOUS
MATERIAL IDENTIFICATION AND MATERIAL SAFETY DATA

 

Contractor shall comply with applicable laws, codes, ordinances, and
regulations (including the obtaining of licenses and permits) in connection
with any hazardous material used during Launch processing. Contractor agrees to
provide the right to use and disclose such data relating to hazardous materials
as necessary to comply with this Article.

 

32.          APPLICABLE
LAWS

 

This Contract shall be interpreted, construed and governed by the
substantive laws of New York, USA, without regard to procedural laws, and
except to the extent that the conflicts of laws rules of New York, USA
would require the application of the laws of another jurisdiction. The Parties
acknowledge and agree that the United Nations Convention on Contracts for the
International Sale of Goods shall not apply to the transactions contemplated in
this Contract.

 

33.          GENERAL

 

33.1  Severability

 

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

 

33.2  Cumulative Rights/Waivers

 

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

 

47

 

33.3 
Gender/Captions

 

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

 

33.4 
Relationship of the Parties

 

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

 

33.5 
Permitted Access to Work in Progress, Inspections, Etc.

 

At any time Customer and its employees,
agents, subcontractors, consultants and representatives are on the premises of
Contractor or any of its Subcontractors pursuant to any provision of this
Contract, they agree to abide by the applicable security and safety
regulations, provided that reasonable notice of any such regulations is
provided by Contractor or Subcontractor, as applicable. As much as reasonably
possible, any such inspections, monitoring or other access to premises
permitted under this Contract shall be made without interference with the
ongoing work of Contractor or Subcontractor, as applicable.

 

33.6  Construction

 

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

 

33.7 
Including

 

Whenever the terms “including” or “include”
are used in this Contract in connection with a single item or a list of items
within a particular classification (whether or not the term is followed by the
phrase “but not limited to” or words of similar effect) that reference shall be
interpreted to be illustrative only, and shall not be interpreted as a
limitation on, or an exclusive enumeration of the items within that
classification.

 

33.8 
Survival

 

Termination or expiration of this Contract
for any reasons shall not release either Party from any liabilities or
obligations set forth in this Contract which remain to be performed or by their
nature would be intended to be applicable following any such termination or
expiration.

 

48

 

33.9 
Entire Agreement

 

This Contract: (i) consists of this
document and the referenced Attachments in 2 of this Contract and the schedules
attached thereto; (ii) constitutes the entire agreement of the Parties
with respect to the subject matter hereof; and (iii) supersedes all prior
correspondence, representations, proposals, negotiations, understandings, and
agreements of the Parties, oral or written, with respect to the subject matter
hereof. No addition to, deletion of, or deviation from the provisions of this
Contract shall be binding against Customer unless in writing and signed by an
Authorized Representative of Customer or against Contractor unless in writing
and signed by an Authorized Representative of Contractor.

 

33.10  Counterparts

 

Execution.  This Contract may be executed in several
counterparts, each of which shall be deemed an original, and all such
counterparts shall constitute but one and the same instrument.

 

Agreement.  Each Party acknowledges that it has read,
understands and agrees to be bound by the provisions of this Contract.

 

* 
*  *  *

 

49

 

IN WITNESS WHEREOF, the Parties hereto have
executed this Contract.

 

	
  RAINBOW
  DBS COMPANY LLC

  	
   

  	
  Lockheed
  Martin Corporation

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ THOMAS
  DOLAN

  	
   

  	
  By:

  	
  /s/ ALAN M.
  HYMAN

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
  Thomas Dolan

  	
   

  	
  Name:

  	
  Alan M.
  Hyman

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
  President
  & CEO

  	
   

  	
  Title:

  	
  Director,
  Contracts

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Date:

  	
  November 21,
  2004

  	
   

  	
  Date:

  	
  November 21,
  2004

  

 

50

 

ATTACHMENT 1

 

STATEMENT
OF WORK***

 

***            Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text.  Copies of the
exhibit containing the redacted portions have been filed separately with the
Securities and Exchange Commission subject to a request for confidential
treatment pursuant to Rule 24b-2 under the Securities Exchange Act
of 1934.

 

 

ATTACHMENT 2

 

SPACECRAFT
PERFORMANCE REQUIREMENTS***

 

***            Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text.  Copies of the
exhibit containing the redacted portions have been filed separately with the
Securities and Exchange Commission subject to a request for confidential
treatment pursuant to Rule 24b-2 under the Securities Exchange Act
of 1934.

 

 

ATTACHMENT 3

 

SPACECRAFT
PERFORMANCE VERIFICATION REQUIREMENTS***

 

***            Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text.  Copies of the
exhibit containing the redacted portions have been filed separately with the
Securities and Exchange Commission subject to a request for confidential
treatment pursuant to Rule 24b-2 under the Securities Exchange Act
of 1934.

 

 

ATTACHMENT 4

 

SPACECRAFT
PRODUCT ASSURANCE REQUIREMENTS***

 

***            Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text.  Copies of the
exhibit containing the redacted portions have been filed separately with the
Securities and Exchange Commission subject to a request for confidential
treatment pursuant to Rule 24b-2 under the Securities Exchange Act
of 1934.

 

 

ATTACHMENT 5

 

SATELLITE
CONTROL AND OPERATIONS REQUIREMENTS***

 

***            Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text.  Copies of the
exhibit containing the redacted portions have been filed separately with the
Securities and Exchange Commission subject to a request for confidential
treatment pursuant to Rule 24b-2 under the Securities Exchange Act
of 1934.

 

 

ATTACHMENT 6

 

SATELLITE
CONTROL AND OPERATIONS PRODUCT ASSURANCE

REQUIREMENTS***

 

***            Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text.  Copies of the
exhibit containing the redacted portions have been filed separately with the
Securities and Exchange Commission subject to a request for confidential
treatment pursuant to Rule 24b-2 under the Securities Exchange Act
of 1934.

 

 

ATTACHMENT 7

 

MILESTONE
PAYMENT PLAN***

 

***            Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text.  Copies of the
exhibit containing the redacted portions have been filed separately with the
Securities and Exchange Commission subject to a request for confidential
treatment pursuant to Rule 24b-2 under the Securities Exchange Act
of 1934.

 

 

ATTACHMENT 8

 

MAXIMUM
TERMINATION LIABILITY AND LETTER OF CREDIT AMOUNT

REQUIREMENTS***

 

***            Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text.  Copies of the
exhibit containing the redacted portions have been filed separately with the
Securities and Exchange Commission subject to a request for confidential
treatment pursuant to Rule 24b-2 under the Securities Exchange Act
of 1934.

 

 

ATTACHMENT 9

 

EXPORT
LAWS COMPLIANCE PROGRAM ***

 

***            Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text.  Copies of the
exhibit containing the redacted portions have been filed separately with the
Securities and Exchange Commission subject to a request for confidential
treatment pursuant to Rule 24b-2 under the Securities Exchange Act
of 1934.

 

 

ATTACHMENT 10

 

CERTIFICATION***

 

***            Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text.  Copies of the
exhibit containing the redacted portions have been filed separately with the
Securities and Exchange Commission subject to a request for confidential
treatment pursuant to Rule 24b-2 under the Securities Exchange Act
of 1934.

 

 

ATTACHMENT 11

 

FORM - BILL
OF SALE***

 

***            Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text.  Copies of the
exhibit containing the redacted portions have been filed separately with the
Securities and Exchange Commission subject to a request for confidential
treatment pursuant to Rule 24b-2 under the Securities Exchange Act
of 1934.

 

 

ATTACHMENT 12

 

OPTIONS***

 

***            Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text.  Copies of the
exhibit containing the redacted portions have been filed separately with the
Securities and Exchange Commission subject to a request for confidential
treatment pursuant to Rule 24b-2 under the Securities Exchange Act
of 1934.

 

 

ATTACHMENT 13

 

***

 

***            Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text.  Copies of the
exhibit containing the redacted portions have been filed separately with the
Securities and Exchange Commission subject to a request for confidential
treatment pursuant to Rule 24b-2 under the Securities Exchange Act
of 1934.

 

 

ATTACHMENT 14

 

***

 

***            Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text.  Copies of the
exhibit containing the redacted portions have been filed separately with the
Securities and Exchange Commission subject to a request for confidential treatment
pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.

 

 

ATTACHMENT 15

 

LETTER OF CREDIT FORM***

 

***            Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text.  Copies of the
exhibit containing the redacted portions have been filed separately with the
Securities and Exchange Commission subject to a request for confidential
treatment pursuant to Rule 24b-2 under the Securities Exchange Act
of 1934.

 

 

ATTACHMENT 16

 

***

 

***            Certain
confidential portions of this exhibit were omitted by means of redacting a
portion of the text.  Copies of the
exhibit containing the redacted portions have been filed separately with the
Securities and Exchange Commission subject to a request for confidential treatment
pursuant to Rule 24b-2 under the Securities Exchange Act of 1934.Exhibit 10.56.1

 

05-RainbowKa-LM-004

 

June 1,
2005

 

Mr. Wilt
Hildenbrand

Rainbow
DBS Company LLC

200
Jericho Quadrangle

Jericho,
NY  11753

 

Subject:  Rainbow Ka-Band Contract dated November 21,
2004, Contract No. 11182004 (“Contract”)

 

Dear
Mr. Hildenbrand:

 

Reference:                Letter Hyman to Hildenbrand dated May 28,
2005, Subject: Maximum Termination Liability Schedule

 

1. Pursuant to the request from Rainbow DBS Company LLC (“Rainbow”),
and the agreement between Lockheed Martin Commercial Space Systems (“LMCSS”)
and Rainbow, by Rainbow concurring to this Letter, the cumulative Maximum
Termination Liability schedule for Ka-1, Ka-2, Ka-3, Ka-4 and Ka-5 in
Attachment 8 to the Contract will remain at the level set forth in the fourth
month after EDC (March 2005) through the Restart Date, as defined
below.  Capitalized terms not defined in
this Letter agreement shall have the meanings ascribed to them in the Contract.

 

2. Nothing in this Letter agreement is intended nor should it
be construed to modify Rainbow’s payment obligations in the ordinary course for
services specified in the invoice dated April 21, 2005, which payment is
currently due and owing.  However, in
accordance with the Contract, payments made by Rainbow for services rendered
and specified in the April 21, 2005 invoice would be refunded in the event
of a Contract termination for convenience made prior to the establishment of a
Restart Date.

 

3. Effective June 1, 2005, (i) all work by LMCSS
under the Contract has been suspended, other than non-recurring work which may
be mutually agreed to by the Parties (such non-recurring work will not result
in any further payment obligation beyond the April 21, 2005 invoice
payment or increase in the Maximum Termination Liability as capped herein)  and (ii) all future payments by Rainbow
under the Contract have been suspended (other than the payment obligations
under Paragraphs 1 and 2 above).

 

4.  Rainbow, with
assistance and support from LMCSS, shall immediately begin to re-assess its
Ka-band satellite program, scope, number of satellites, orbital locations and
technical design and, on or before November 21, 2005, Rainbow shall either
(i) terminate the Contract under Article 17, (ii) notify LMCSS
to proceed with the work as originally contemplated under the Contract, or (iii) notify
LMCSS of the particulars of a revised Ka-band program to be implemented under
the Contract.  Upon receipt of a notice
under clause (ii) or (iii) above, LMCSS shall process a Contract
Change Notice, and Rainbow shall either accept or reject the Contract Change
Notice in accordance with the Contract. 
If Rainbow accepts the Contract Change Notice (including any
modifications as may be agreed by the Parties), LMCSS shall restart the
program, as amended by the agreed upon Contract Change Notice, upon the date of
Rainbow’s acceptance thereof (“Restart Date”), and the Contract shall be
modified to reflect the changes mutually agreed in accordance with the Contract
Change Notice.  If Rainbow rejects the
Contract Change Notice, the Contract shall be terminated in accordance with Article 17,
and such termination shall be deemed to have occurred prior to the
establishment of a Restart Date.  Upon
termination under and in accordance

 

 

with Article 17, LMCSS shall promptly refund to Rainbow
all amounts paid by Rainbow under the Contract in excess of termination
charges, which termination charges shall not exceed the Maximum Termination
Liability set forth in Paragraph 1 hereof.

 

5. The Parties acknowledge that, because of the suspension of
work under Paragraph 3 above, LMCSS is not bound by the Promised Delivery Dates
currently set forth in Article 3 of the subject Contract.  Moreover, Rainbow’s right to terminate the
Contract for cause under Paragraph 18.1(f) shall not be triggered by LMCSS’s
failure to complete the FCC milestones by the dates currently specified by the
FCC as a result of the suspension of the work under Paragraph 3 above.  As part of any Contract Change Notice issued
under Paragraph 3 above, LMCSS shall specify (i) any necessary changes in
the Promised Delivery Dates and (ii) the dates by which it will be able to
meet the FCC milestones, taking into account the number of Days that work was
suspended, the scope of the Contract change and LMCSS’s normal and customary
practices.

 

6. This Letter agreement supercedes all prior discussions and
understandings of the Parties with respect to the subject matter hereof.

 

As always, if you have any questions or comments, please do
not hesitate to contact me.

 

 

	
  Best regards,

  	
  Concurrence:

  
	
   

  	
   

  
	
  /s/ Alan M. Hyman

  	
   

  	
  /s/ Wilt Hildenbrand

  	
   

  
	
  Alan M. Hyman

  	
   

  
	
  Director, Contracts Management

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Rainbow DBS Company LLC

  
					

 

 

	
  cc:

  	
  David A. Deitch

  
	
   

  	
  Wilt Hildenbrand

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