EXHIBIT 10.39
CONFORMED AS AMENDED
SATELLITE AGREEEMENT
between
APT SATELLITE COMPANY LIMITED
and
LORAL ORION, INC.
Form of Amended & Restated as of August 26, 2003, as Amended Pursuant
to the Settlement Agreement dated November 16, 2003
PROPRIETARY
AGREEMENT
INDEX
Page
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ARTICLE 1. INTERPRETATION........................................................ 1
ARTICLE 2. PARTIES' INTERESTS IN THE SATELLITE................................... 2
ARTICLE 3. PAYMENT PLAN AND INSURANCE............................................ 7
ARTICLE 4. OPERATION OF TRANSPONDERS............................................. 8
ARTICLE 5. THE SATELLITE AND RELATED CONTRACTS................................... 9
ARTICLE 6. REPRESENTATIONS AND WARRANTIES
OF THE PARTIES........................................................ 10
ARTICLE 7. LEASE OF ADDITIONAL TRANSPONDERS...................................... 11
ARTICLE 8. [RESERVED]............................................................ 12
ARTICLE 9. ORBITAL SLOT.......................................................... 12
ARTICLE 10. LANDING RIGHTS........................................................ 14
ARTICLE 11. SUCCESSOR SATELLITE RENEWAL........................................... 14
ARTICLE 12. EFFECTIVE DATE OFTHIS AGREEMENT....................................... 16
ARTICLE 13. PLEDGES............................................................... 16
ARTICLE 14. TRANSFER.............................................................. 16
ARTICLE 15. RELATIONSHIP OF PARTIES............................................... 17
ARTICLE 16. TAXES................................................................. 17
ARTICLE 17. ENTIRE AGREEMENT, TRANSACTION......................................... 17
DOCUMENTS
ARTICLE 18. TERMINATION AND CERTAIN BANKRUPTCY EVENTS............................. 18
ARTICLE 19. FORCE MAJEURE......................................................... 18
PROPRIETARY
ARTICLE 20. DEFAULT............................................................... 19
ARTICLE 21. CONFIDENTIALITY....................................................... 20
ARTICLE 22. ASSIGNMENT............................................................ 20
ARTICLE 23. GOVERNING LAW......................................................... 21
ARTICLE 24. DISPUTE RESOLUTION.................................................... 21
ARTICLE 25. NOTICES............................................................... 22
ARTICLE 26. MISCELLANEOUS......................................................... 23
Schedule 1 Definitions
Annex A Description of Loral Transponders
Annex B Take Up Schedule for the Remaining Loral Transponders
Annex C The Parties' Respective Interests in the 54 Transponders on the
Satellite
Annex D [Reserved]
Annex E Transponder Performance Validation
Annex F Material Restrictions or Agreements that Impact the Loral
Transponders
Annex G Ku-band Beam #2 Modification
PROPRIETARY
FORM OF SATELLITE AGREEMENT, AS AMENDED AND CONFORMED
This Amended and Restated Agreement is dated as of the 26th day of August, 2003,
as conformed to reflect the amendments entered into on November 16, 2003 as
described below, by and between
APT SATELLITE COMPANY LIMITED, a company organized and existing under the
laws of Hong Kong with its registered office at Rooms 3111-3112, Xxx
Xxxxxxx Xxxxx, 00 Xxxxxxxxx, Xxxx Xxxx ("APT")
and
LORAL ORION, INC., a corporation organized and existing under the laws of
the state of Delaware, U.S.A., with its principal place of business at 000
Xxxxx Xxxxx, Xxxxxxxxxx, XX 00000, X.X.X. ("Loral Orion")
WHEREAS APT and Space Systems/Loral, Inc. ("SS/L") have entered into a satellite
procurement contract dated as of January 8, 2001, for the construction, testing
and purchase of the Satellite; and
WHEREAS on December 10, 2002, APT and Loral Orion entered into an agreement to
provide among other things, for the joint acquisition of the Satellite (formerly
known as the Condosat Agreement, now referred to herein as the "Satellite
Agreement"); and
WHEREAS, SS/L and Loral Orion entered into an agreement dated June 30, 2003,
pursuant to which Loral Orion agreed to make certain payments to SS/L relating
to the construction and launch of the Satellite; and
WHEREAS, on August 26, 2003, APT and SS/L entered into an amendment to the SS/L
Contract to provide that SS/L will transfer title to the Satellite to Loral
Orion upon Intentional Ignition of the Launch Vehicle providing Launch Services
for the Satellite as set forth therein; and
WHEREAS, on August 26, 2003, APT and Loral entered into a satellite transponder
agreement (the "APT Lease Agreement") pursuant to which Loral Orion will, in
consideration of the payments made and to be made by APT with respect to the
Satellite, lease to APT certain transponder capacity on the Satellite until the
End of Life of such Satellite in accordance with the terms set forth therein;
and
WHEREAS, on November 16, 2003, APT, Loral Orion and SS/L entered into a
settlement agreement (the "Settlement Agreement"), which agreement provided for
the amendment of this Agreement and the assumption of this Agreement pursuant to
Section 365 of the U.S. Bankruptcy Code; and
PROPRIETARY
WHEREAS, the Amended and Restated Satellite Agreement dated as of August 26,
2003, as further amended to conform to the Settlement Agreement, is as set forth
below:
NOW, THEREFORE, in consideration of the premises and of the mutual
representations, warranties, covenants and agreements hereinafter contained, the
parties hereto agree as follows:
ARTICLE 1
INTERPRETATION
1.1 Words and expressions used in this Agreement shall have the meanings set
out in Schedule 1, unless the context requires otherwise.
1.2 The Schedules and Annexes to this Agreement shall form part of this
Agreement.
1.3 References to a Party giving consent or approval shall be deemed to be in
such Party's sole judgment and discretion, except as specifically set
forth herein.
ARTICLE 2
PARTIES' INTERESTS IN THE SATELLITE
2.1 APT's Interest in the Satellite
Pursuant to the terms of the APT Lease Agreement, and subject to the
conditions set forth therein, APT will have a leasehold interest in all
transponders on the Satellite that are not identified herein as the
Initial Loral Transponders (the "APT Leasehold Interest"). Subject to the
terms set forth therein, the term of the APT Lease Agreement shall
commence at the time that SS/L transfers title of the Satellite to Loral
Orion and continue thereafter until the End of Life of the Satellite or,
with respect to each Remaining Loral Transponder, until such time when
Loral Orion terminates the APT Leasehold Interest in such Remaining Loral
Transponder as set forth in Paragraph 2.4.2 of this Agreement. In
addition, APT is the licensee of the rights to the Orbital Slot and has
agreed to make the Orbital Slot available to Loral Orion for use in
connection with the operation of the Satellite for no additional
consideration as set forth in the Orbital Sub-License Agreement.
2.2 Loral Orion's Interest in the Satellite
Pursuant to the terms of the SS/L Contract and the Related Orion
Agreement, Loral Orion will assume APT's rights to receive title to the
Satellite upon Intentional Ignition of the Launch Vehicle providing Launch
Services for the Satellite on the condition that Loral Orion will,
simultaneously with its receipt from SS/L of title to the Satellite, grant
the APT Leasehold Interest to APT. However, upon payment of the
termination payments required to be made by Loral Orion to APT as
described in Article 3 below, the APT Leasehold Interest in certain
transponders on the Satellite will be terminated so that upon completion
of all termination payments to be made as set forth in Article 3 below,
Loral Orion's right, title
PROPRIETARY
and interest in the Satellite shall be as follows:
(i) title to twenty-five (25) of the transponders on the Satellite (free
of any APT Leasehold Interest), as follows:
- 12 standard frequency C-band transponders;
- 6 extended frequency C-band transponders; and
- 7 Ku-band transponders on Beam #2,
in each case as identified and described on Annex A hereto (collectively
and including any replacement capacity allocated to Loral Orion, the
"Loral Transponders"); and
(ii) title to the remaining transponders on the Satellite (subject to the
APT Leasehold Interest).
Title in the Common Elements shall be vested in Loral Orion.
2.3 Identification and Assignment of Loral Transponders
2.3.1 Assuming all transponders on the Satellite are performing according
to specifications, APT shall be entitled, on or before March 31,
2004, to make minor adjustments to the designation of the six (6)
transponders identified as the "Assigned Transponders" in Annex A
hereto, subject to obtaining Loral Orion's consent thereto, which
consent shall not be unreasonably withheld.
2.3.2 APT represents and warrants that the six (6) transponders on APSTAR
I corresponding to the Assigned Transponders shall have historically
not experienced any unacceptable level of interference from adjacent
or nearby satellites and can be fully saturated.
2.3.3 Reserved.
2.3.4 APT and Loral Orion agree that they will not enter into any
coordination or other agreement relating to the Russian Filing or
the satellite that is the subject of the Russian Filing (the
"Russian Satellite") that would result in the other Party bearing a
disproportionate amount (i.e., more than 54% in the case of APT and
more than 46% in the case of Loral Orion) of the potential or actual
risk of coordination with the Russian Filing or the Russian
Satellite.
2.3.5 APT will use its reasonable best efforts, subject to the principles
set forth in this Paragraph 2.3 and the requirements in any
coordination agreements affecting the Orbital Slot presently
existing or permitted under Paragraph 9.1 of this Agreement, so that
all Loral Transponders will not suffer unacceptable levels, as
reasonably determined by Loral Orion (after consultation with APT),
of
PROPRIETARY
interference from adjacent satellites.
2.3.6 APT will support Loral Orion's selection and loading of the Loral
Transponders by providing technical information concerning
transponder performance, interference considerations and operation.
2.3.7 APT represents that the interference it has experienced on APSTAR I,
on a historical basis, is as set forth in Annex F hereto.
2.4 Loral Orion's Interest in the Loral Transponders
2.4.1 The Initial Loral Transponders (which shall not be subject to the
APT Leasehold Interest) shall consist of the following: -
- 8 standard C-band transponders;
- 5 extended C-band transponders; and
- 4 Ku-band transponders;
in each case as identified and described in Annex A hereto.
2.4.2 As to the Remaining Loral Transponders, which are subject to the APT
Leasehold Interest, APT agrees that, subject to the provisions of
Paragraph 2.4.4 below and the relevant payment by Loral Orion
pursuant to Paragraph 3.1 below, the entire APT Leasehold Interest
in the Remaining Loral Transponders shall be terminated as follows:
- as to 4 transponders on each of the fourth and fifth
anniversaries of the Satellite's in-service date (each
such date, including any accelerated take up date as
described in Paragraph 2.4.3 below, a "Termination
Date").
The termination of the relevant APT Leasehold Interest shall become
automatically and immediately effective with respect to any
Remaining Loral Transponder on the date that Loral Orion makes the
termination payment with respect to such transponder as provided in
Paragraph 3.1 below by wire transfer of funds into the following
bank account (the "Designated Account"):
Company name: APT Satellite Company Limited
Bank: Bank of China (Hong Kong) Limited
Bank Branch: Bank of China Tower Branch
Bank Address: 0 Xxxxxx Xxxx, Xxxx Xxxx
Account No.: 012-875-9-223700-5
Swift Code: XXXXXX00
Upon such termination, Loral Orion shall have no further obligation
or liability in respect of such Remaining Loral Transponder under
the APT Lease Agreement, and APT shall have no further right or
interest, whatsoever, in
PROPRIETARY
respect of such Remaining Loral Transponder. APT shall cooperate
with and assist Loral Orion from time to time as required to
evidence any such termination and Loral Orion's interest in the
Loral Transponders for which the APT Leasehold Interest has been
terminated as set forth in this Agreement, including without
limitation, executing an acknowledgement of termination or such
other documents as Loral Orion may reasonably request to evidence
its interest in the applicable transponders.
Subject to Loral Orion's acceleration rights to earlier termination
as set forth in Paragraph 2.4.3 below, the termination schedule for
the Remaining Loral Transponders is set forth in Annex B hereof.
2.4.3 Loral Orion shall have the right at its option to accelerate the
date on which it terminates the APT Leasehold Interest as provided
in Paragraph 2.4.2 of this Agreement in one (1) of the standard
frequency C-band Remaining Loral Transponders and any or all of the
extended frequency C-band and Ku-band Remaining Loral Transponders;
provided however that Loral Orion may not, without APT's prior
written consent, exercise such acceleration right with respect to
any Remaining Loral Transponder that is then subject to a sub-lease
agreement with a customer or otherwise subject to the contractual
rights of a customer, including any contractually provided renewal
term, if the expiration date of such sub-lease agreement or other
contractual rights shall be later than Loral Orion's proposed
accelerated termination date.
2.4.4 With respect to Loral Orion's obligation to make termination
payments to APT as set forth in Paragraph 3.1 below with respect to
the Remaining Loral Transponders, APT shall bear the risk of loss
with respect to any such transponder until the termination payment
is made by Loral Orion in respect of such transponder in accordance
with Paragraph 3.1. Accordingly, Loral Orion shall have no
obligation to make the termination payment in respect of any
Remaining Loral Transponder if such transponder (i) fails to meet
the requirements set forth on Annex E hereto on the relevant
Termination Date, or (ii) for which APT has submitted an insurance
claim.
Loral Orion shall be obligated to terminate and pay the related
termination payment for a Remaining Loral Transponder in accordance
with Paragraph 3.1 of this Agreement, even if APT shall have
previously received a warranty payback or transponder
performance-based reduction in the amount of the final milestone
payment by APT under the SS/L Contract in respect thereof, if (i)
neither of the requirements set forth in the preceding sentence has
been met and (ii) the termination payment to be made by Loral Orion
to APT to terminate the APT Leasehold Interest in such transponder
shall be reduced by an amount equal to the amount of such warranty
payback and/or the amount of such final milestone payment reduction,
as applicable, that relates to such transponder.
PROPRIETARY
2.5 Reserved
2.6 Respective Interests in the Satellite
A table of APT's and Loral Orion's respective interests in the Satellite's
transponders after each scheduled Termination Date is set forth in Annex
C.
2.7 Economic Interest Prior to Title Transfer.
2.7.1 Notwithstanding that the SS/L Contract calls for performance from
SS/L to APT only, APT acknowledges and agrees that, prior to the
time that title to the Satellite is transferred by SS/L to Loral
Orion pursuant to the SS/L Contract, Loral Orion has a vested
economic interest in the SS/L Contract, including but not limited to
work-in-progress thereunder, to the extent of the following:
(i) the reduction in APT's purchase price for the Satellite and
other deliverable items under the SS/L Contract, effected by
Amendment No. 3 to the SS/L Contract and the Settlement
Agreement dated November 16, 2003 between APT, SS/L and Loral
Orion;
(ii) payments made by Loral Orion to SS/L for the redesign of
Ku-band Beam #2 pursuant to Paragraph 5.2 of this Agreement;
and
(iii) payments made or launch deposits (or other similar
prepayments) applied by Loral Orion toward launch services for
the Satellite.
2.7.2 APT represents and warrants to Loral Orion that any pledge or
assignment of its interest under the SS/L Contract to its lenders
shall not extend to Loral Orion rights and interests set forth in
Paragraph 2.7.1 above.
2.8 Management Agreement. The Parties acknowledge and agree that
notwithstanding their respective economic interests in the Satellite,
certain decisions regarding the Satellite shall be made in accordance with
the terms and conditions of the Management Agreement and that they shall
exercise their rights with respect to their interests in the Satellite in
accordance with such Agreement.
ARTICLE 3
PAYMENT PLAN
3.1 Subject to the provisions of Paragraphs 2.4.3, 2.4.4 and 3.2, Loral Orion
shall pay APT as follows to terminate the APT Leasehold Interest in the
Remaining Loral Transponders as provided in Paragraph 2.4.2 of this
Agreement:
PROPRIETARY
(a) On the fourth anniversary of the Satellite's in-service date,
US$18,132,400 to terminate the APT Leasehold Interest in the 4 additional
transponders specified on Annex B hereto.
(b) On the fifth anniversary of the Satellite's in-service date,
US$18,132,400 to terminate the APT Leasehold Interest in the 4 additional
transponders specified on Annex B hereto.
All payments to be made to APT hereunder shall be made by wire transfer of
immediately available funds in U.S. dollar currency to the Designated
Account.
3.2 The total price set forth in Paragraph 3.1 above to terminate the APT
Leasehold Interest in the Remaining Loral Transponders as provided in
Paragraph 2.4.2 of this Agreement shall at all times equal 16% of the cost
of constructing (exclusive of the modification costs described in
Paragraph 5.2 below (the "Modification Costs") but including the costs for
the ground system under the Ground Equipment Contract and launching the
Satellite (collectively the "Satellite and Launch Costs") and 32% of the
cost of insuring the Satellite under the two insurance policies brokered
by Xxxxxx Inspace as described in Paragraph 3.4 below but excluding any
costs related to the Additional Insurance Amount (the "Loral Insurance
Cost"). The Satellite and Launch Costs shall consist of any payment,
liability or other amount paid or incurred by APT or Loral Orion under the
SS/L Contract, the Ground Equipment Contract, the Related Orion Agreement
or the LSA, excluding the Modification Costs or any payment, liability or
other amount paid or incurred by APT or Loral Orion as a result of such
Party's willful misconduct, gross negligence or material breach of the
relevant agreements (other than any such breach resulting from joint
action or decision of APT and Loral Orion). If subsequent to the date of
this Agreement, there shall be any increase or decrease in the Satellite
and Launch Costs or the Loral Insurance Cost (including as a result of the
operation of the first paragraph of Article 13.5 of the SS/L Contract and
the analogous provision in the Related Orion Agreement) such that the sum
(the "Allocable Share of Project Cost") of (i) 16% of the Satellite and
Launch Costs and (ii) 32% of the Loral Insurance Cost shall be other than
US$36,264,800, then the total price to terminate the APT Leasehold
Interest in the Remaining Loral Transponders shall be adjusted
accordingly, after taking into account which Party shall have borne the
additional cost or received the benefit of any decrease in price.
3.3 Reserved.
3.4 The Launch Insurance (as defined) for the Satellite will be divided into
three policies, among which two policies will have an aggregate insured
value of approximately US$115 million to be brokered by Xxxxxx Inspace and
a third policy, which will also have an insured value of approximately
US$115 million to be brokered by Xxxxx McLennan. Loral Orion shall be
responsible for 68% (approximately US$14,584,300) of the gross insurance
premiums related to the two policies for Launch Insurance brokered by
Xxxxxx Inspace, with APT being responsible for the remaining 32%
(approximately US$6,863,200). If Loral Orion increases the aggregate
insured value
PROPRIETARY
(the "Additional Insurance Amount") over US$115 million for the launch
insurance brokered by Xxxxxx Inspace, then APT shall not be responsible
for the insurance premiums relating to such Additional Insurance Amount
and Loral Orion shall be responsible for 100% of such additional insurance
premiums. APT shall be responsible for 100% of the gross insurance
premiums related to the policy for Launch Insurance brokered by Xxxxx
XxXxxxxx. Such insurance shall consist of coverage commencing from
Intentional Ignition to 365 days thereafter (the "Launch Insurance").
Loral Orion or its designee shall be the named insured and the loss payee
in respect of the Initial Loral Transponders and APT or its designee shall
be the named insured and the loss payee in respect of the remaining
transponders on the Satellite with respect to the Launch Insurance;
provided however, that if Loral Orion shall have accelerated the
termination of the APT Leasehold Interest in any Remaining Loral
Transponders so that such termination shall occur within the coverage
period of the Launch Insurance, then APT agrees that it shall cause Loral
Orion or its designee to be the named insured and the loss payee in
respect of any Remaining Loral Transponders, the APT Leasehold Interest of
which was terminated within such coverage period, effective as of the
applicable Termination Date. Loral Orion shall be responsible for
procuring at its own expense in-orbit insurance for the Loral Transponders
following expiration of the coverage period of the Launch Insurance
policies described above.
ARTICLE 4
OPERATION OF TRANSPONDERS
Except as set forth in the Marketing Agreement, each of APT and Loral Orion
shall be entitled to all revenues generated from the APT Transponders and the
Loral Transponders, respectively.
ARTICLE 5
THE SATELLITE AND RELATED CONTRACTS
5.1 The Satellite shall generally have such design and other specifications as
are set forth in the SS/L Contract and in this Agreement.
5.2 The footprint of Beam #2 Ku-band transponders on the Satellite will be
modified by SS/L as requested by Loral Orion, which modification costs
shall be borne by Loral Orion. Such modifications, and the costs thereof,
are set forth in Annex G hereto, which modifications are hereby approved
by APT. In the event of any further modification to the footprint of Beam
#2 Ku-band transponders, such further modifications, and the costs
thereof, shall be agreed between SS/L and Loral Orion provided the
modifications do not materially impact the Common Elements or the APT
Transponders. If such modifications do materially impact the Common
Elements or the APT Transponders, APT and Loral Orion shall jointly
approve them pursuant to the Management Agreement.
5.3 Loral Orion acknowledges that it has reviewed the SS/L Contract and the
Launch Services Agreement and agrees to all the terms and conditions
contained therein and that
PROPRIETARY
it shall be bound by all actions taken by APT with respect thereto or with
regard to the selection of the Launch Agency or with regard to the Launch
Services Agreement, provided such action is taken in full compliance with
the obligations of the Management Agreement.
5.4 Loral Orion acknowledges that:
EXCEPT AND TO THE EXTENT EXPRESSLY PROVIDED IN THIS AGREEMENT, APT HAS NOT
MADE, NOR DOES IT MAKE, ANY REPRESENTATION OR WARRANTY, WHETHER WRITTEN OR
ORAL, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION, ANY WARRANTY OF
DESIGN, OPERATION, CONDITION, QUALITY, SUITABILITY OR MERCHANTABILITY OR
FITNESS FOR USE OR FOR A PARTICULAR PURPOSE, ABSENCE OF LATENT OR OTHER
DEFECTS, WHETHER OR NOT DISCOVERABLE, WITH REGARD TO THE SATELLITE, AND
APT HAS NOT MADE ANY WARRANTY WITH RESPECT TO THE PERFORMANCE OF ANY
LAUNCH VEHICLE.
5.5 Loral Orion agrees to be bound by the no-fault, no-subrogation inter-party
waiver of liability and related indemnity provisions provided in the
Launch Services Agreement and to cause its contractors and subcontractors
at any tier (including suppliers of any kind) that are involved in any
performance of this Agreement and any other person who through Loral Orion
has an interest in the Satellite or any transponder thereon, as required
by the Launch Services Agreement, to accede to such waiver. Loral Orion
shall execute and deliver any instrument that may be reasonably required
by the Launch Agency to evidence its agreement to be bound by such waiver.
In no event shall such no-fault, no-subrogation inter-party waiver and
related indemnity provisions have any effect on the rights, obligations,
and liabilities of and between Loral Orion and APT under this Agreement or
under the other Transaction Documents.
5.6 APT and Loral Orion hereby agree that in the event any payment (whether in
the form of a refund, reduction or damages) is made by the Launch Agency
in respect of the LSA, APT and Loral Orion shall agree in good faith upon
an allocation of such payment between the two parties consistent with the
intent of the parties and the principles set forth in this Agreement. Each
of APT and Loral Orion hereby agrees that to the extent that it receives
any such payment, whether from the Launch Agency or otherwise, that is in
excess of its agreed upon allocated amount, it shall promptly remit any
such excess amount to the other Party.
5.7 APT and Loral Orion agree that in the event that either of them issues an
invoice to SS/L where the right to payment depends upon the respective
interests of APT and Loral Orion in the Satellite, it shall provide a copy
of such invoice to the other Party and that the SS/L Contract and the
Related Orion Agreement, as the case may be, shall provide that SS/L shall
not pay any invoice to which the other Party has notified SS/L of an
objection within 15 days after the date of issuance thereof.
PROPRIETARY
ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF THE PARTIES
Each of the parties, as of August 26, 2003, hereby represents and warrants to
the other, as follows:
6.1 Organization and Standing. It is a company with limited liability duly
organized, validly existing and in good standing under the laws of the
place of its incorporation and has all requisite corporate power and
authority to own, lease and operate its properties and to carry on its
businesses as now being conducted, except where the failure to be so
organized, existing and in good standing or to have such power and
authority would neither have a material adverse effect on its financial
condition, business or results of operation nor materially impair or delay
its ability to consummate the transactions contemplated hereby (a
"Material Adverse Effect").
6.2 Authority Relative to this Agreement. Subject to any approval of the U.S.
Bankruptcy Court for the Southern District of New York (the "Bankruptcy
Court") that may be required, in the case of Loral Orion, it has all
corporate power and authority to execute and deliver this Agreement and
the other Transaction Documents, and to perform all of its obligations
hereunder and thereunder. Its execution and delivery of this Agreement and
the other Transaction Documents, and its performance of its obligations
hereunder and thereunder have been duly authorized by all necessary and
proper corporate action. This Agreement and the other Transaction
Documents have been duly executed and delivered by it and constitute the
legal, valid and binding obligations, enforceable against it in accordance
with their terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium and similar laws relating to or affecting
creditors' rights and subject, as to enforceability, to general principles
of equity (regardless whether enforcement is sought in a proceeding in
equity or at law).
6.3 Noncontravention. Subject to any approval of the Bankruptcy Court that may
be required, in the case of Loral Orion, its execution and delivery of
this Agreement and the other Transaction Documents, its performance of its
obligations to be performed hereunder and thereunder and the consummation
of the transactions contemplated hereby and thereby will not (i)
contravene or conflict with its memorandum and articles of Association,
by-laws or other organizational documents; (ii) contravene or conflict
with or constitute a violation of any provision of any laws or license to
which it or any of its properties or assets is subject; or (iii) conflict
with, result in a breach of, constitute a default under, result in the
acceleration of, cause it to make an offer to purchase under, create in
any party the right to accelerate, terminate, modify or cancel, require
any notice or give rise to a loss of any benefit under, any contract,
lease, lien or other arrangement to which it is a party or by which is
bound or to which any of its properties or assets is subject or result in
the creation or imposition of any liens on any of its assets, other than
any loss of benefit, lien or any other such event which would not have a
Material Adverse Effect.
PROPRIETARY
6.4 Governmental Proceeding; Litigation. Except for the Consent Agreement
dated January 9, 2002 entered into by Loral Space & Communications Ltd.
with the U.S. Department of State, any order of the Bankruptcy Court that
may be issued approving this Agreement and any export control approvals,
licenses, technical assistance or other similar agreements obtained to
date or required by applicable law, there is not in effect any judgment,
order, writ, decree, stipulation or injunction by or with any governmental
entity to which it or any of its Affiliates is party or by which it or any
of its Affiliates or any properties or assets of any of the foregoing is
bound, and which relates to or affects this Agreement or the transactions
contemplated hereby, and neither it nor any of its Affiliates is party to,
engaged in or, to its Knowledge, threatened with any Action which relates
to or affects this Agreement or the transactions contemplated hereby, and,
to its Knowledge, no event has occurred and no condition exists which
could reasonably be expected to result in any such Action. Neither it nor
any of its Affiliates is in default under or with respect to any judgment,
ruling, order, writ, decree, stipulation or injunction of the type
described in this Paragraph.
ARTICLE 7
LEASE OF ADDITIONAL TRANSPONDERS
7.1 Loral Orion may elect to lease or sub-lease from APT additional standard
C-band frequency transponders on the Satellite or on APSTAR VI, if
available. Loral Orion shall give written notice to APT of its desire to
lease or sub-lease an additional transponder, which notice shall identify
the desired number of transponders, the proposed lease term, and the
desired protection level. APT shall respond within fifteen (15) days of
receipt of such notice, as to whether such transponder is available. If
APT responds that such transponder is available, it shall propose the
terms and conditions for such lease or sub-lease. APT agrees that such
terms and conditions shall reflect the fact that Loral Orion is entitled
to "most favored customer" status in respect of such lease, subject to all
relevant terms being equal. The parties agree that they will look to APT's
leases in the ordinary course of business with wholesale customers (as
opposed to retail customers) for purposes of determining "most favored
customer" status and the parties shall negotiate the terms of any such
lease on an arms length basis. APT may decline to lease additional
transponder(s) to Loral Orion under this Paragraph 7.1, even if available,
if Loral Orion's proposed term for such lease is less than twelve (12)
months. Further, if the term of such lease arrangement is to the End of
Life of the Satellite or APSTAR VI, as the case may be, Loral Orion shall
have follow-on rights to continue such lease arrangement in respect of the
relevant successor satellite on terms and conditions substantially similar
to those set forth under the original lease arrangement, except for price,
which shall be agreed upon by the parties, based on the "most favored
customer" pricing then available on such successor satellite.
7.2 Loral Orion may also elect to lease the transponders on APSTAR I, if
available, that correspond to the standard C-band Initial Loral
Transponders on the Satellite, on the most favored customer terms
described in Paragraph 7.1 above. Loral Orion shall give written notice to
APT of its desire to lease an additional transponder, which notice shall
PROPRIETARY
identify the desired number of transponders, the proposed lease term, and
the desired protection level. APT shall respond within fifteen (15) days
of receipt of such notice, as to whether such transponder is available,
and if so, shall propose the terms and conditions for such lease.
ARTICLE 8
[RESERVED]
ARTICLE 9
ORBITAL SLOT
9.1 Coordination Activities.
9.1.1 APT shall keep Loral Orion fully informed of the status of all
coordination activities relating to the Orbital Slot and shall, if
so requested by Loral Orion, allow Loral Orion to participate in
such activities, subject to the restrictions of OFTA and other
relevant governmental authorities and of any license arrangements
with regard to the Orbital Slot. APT agrees that it will not,
without Loral Orion's prior written consent, take any action or
enter into any agreement in relation to the Orbital Slot that
materially impacts the Loral Transponders or involves the payment of
money or other financial accommodation which will be borne by Loral
Orion. APT shall use its reasonable best efforts to fully enforce
the terms of coordination agreements entered into for the benefit of
the Satellite or any successor satellite.
9.1.2 APT has taken all actions required of APT to date to coordinate the
Satellite in the Orbital Slot. Annex F sets forth (i) all material
restrictions on the Satellite resulting from coordination activities
as of August 26, 2003, (ii) all material agreements or commitments
relating to coordination proceedings for the Orbital Slot and all
Summary Record Documents, true and complete copies of which were
previously provided to Loral, (iii) lists of all the countries and
operators with which the operator of the Satellite has been or will
be required to enter into coordination discussions and the status of
those discussions.
9.1.3 APT will use its reasonable best efforts so that (i) the Loral
Transponders will not suffer from any unacceptable restrictions, as
reasonably determined by Loral Orion (after consultation with APT),
with regard to allowing unencumbered carrier loading on the
transponders and (ii) operation of the Loral Transponders will be
free of unacceptable interference, as reasonably determined by Loral
Orion (after consultation with APT), from adjacent satellite
operations, subject however in each case to any regulatory
restrictions or restrictions contained in coordination agreements
relating to the Orbital Slot presently existing or permitted under
Paragraph 9.1.1. APT will use its reasonable best efforts so that
Loral Orion may place either analog or digital
PROPRIETARY
carriers on the Loral Transponders without restrictions as full
transponders, single channel per carrier, or multiple channels per
carrier.
9.2 License Rights.
APT shall, in consultation with Loral Orion,
(a) make all regulatory filings and take such other actions on a timely
basis with the MII, the OFTA, TongaSat, the ITU and the applicable
governmental entities of those jurisdictions to which the Satellite
may provide coverage, as may be necessary or appropriate to secure
and maintain its rights to utilize the Orbital Slot, including
without limitation, using its best efforts to preserve the
unencumbered and unrestricted use of the Orbital Slot and diligently
prosecuting renewal of the ITU authorization during a reasonable
period prior to its scheduled expiration date;
(b) use its best efforts to achieve, maintain and renew notification for
the Orbital Slot at the ITU and have the filing entered in the ITU
Master Frequency Register; and
(c) make such filings as Loral Orion may reasonably request, including
filings to expand the frequencies and coverage area of the Orbital
Slot.
9.3 APT shall use its best efforts to provide Loral Orion with quiet enjoyment
of the Orbital Slot.
9.4 APT shall keep Loral Orion fully informed with regard to its license
agreements and all regulatory filings, correspondence and notices from or
with MII, OFTA, TongaSat, the ITU and relevant governmental entities
relating to the authorization to use the Orbital Slot.
9.5 Loral Orion and APT will share the Orbital Slot license fees payable to
TongaSat pursuant to the Licence Agreement entered into between APT and
TongaSat dated July 8, 2003 (the "Slot License Agreement") as follows:
(a) APT shall pre-pay US$4 million to TongaSat (the "Orbital Slot
Prepayment").
(b) Commencing with the completion of in-orbit testing of the Satellite
("IOT") and continuing through the fifth anniversary of IOT, a fee
of $1.1 million per year, which fee will be payable quarterly in
arrears and shared between APT and Loral Orion in a ratio equal to
the ratio between the number of transponders in each Party's Payload
during the period in question (pro rated for any change in relative
interest during such period). Pursuant to the Slot License
Agreement, in recognition of
PROPRIETARY
APT having made the Orbital Slot Prepayment, during the five-year
period commencing from completion of IOT, APT shall receive a credit
of US$800,000 per year (that is, US$200,000 per quarter), and such
credit shall be applied towards payment of the license fee described
in this clause (b). The balance of the license fee referred to in
this clause (b), payable for each of the first five years after IOT
shall be US$300,000 per year.
(c) Commencing with the sixth anniversary of IOT and through the
fifteenth anniversary of IOT, a fee of $1.175 million per year,
which fee will be payable quarterly in arrears and shared between
APT and Loral Orion in a ratio equal to the ratio between the number
of transponders in each Party's Payload during the period in
question (pro rated for any change in relative interest during such
period).
(d) Commencing with IOT and continuing through the fifteenth anniversary
of IOT, Loral Orion and APT shall provide to TongaSat, free of
charge, use of 1/2 of a standard C-band transponder and 1/2 of an
extended C-band on the Satellite, to be allocated between APT and
Loral Orion in a ratio equal to the ratio between the number of
transponders in each Party's Payload during the period in question
(pro rated for any change in relative interest during such period),
with the exact identification of transponder capacity to be mutually
agreed by Loral Orion and APT.
(e) Loral Orion agrees to reimburse APT (in the same proportion as that
applicable for the license fee as set forth in clause (b) above) for
the interest charges incurred by APT (not to exceed LIBOR plus 1.5%
per annum with interest calculated on the basis of a year of _360
days) to effect the Orbital Slot Prepayment. For purposes of
calculating the foregoing interest charges, the principal amount of
the loan shall be deemed reduced by US$200,000 per quarter starting
with the first quarter after IOT until the fifth anniversary of the
IOT, at which time the loan shall be deemed to be paid in full and
thereafter no further interest charges shall be incurred.
(f) Within 15 days after IOT, and thereafter, at least 30 days prior to
each quarterly payment date as set forth below, APT shall deliver to
Loral Orion an invoice showing, in reasonable detail and with such
supporting documentation as Loral Orion may reasonably request, the
amount for which APT is seeking reimbursement from Loral Orion in
relation to either the license fee payable for the relevant quarter
under clause (b) above and/or interest on the Orbital Slot
Prepayment as set forth in clause (e) above. The first reimbursement
date shall be 30 days after IOT and shall cover Loral Orion's share
of the interest expense on the Orbital Slot Prepayment which has
accrued from the date on which the prepayment was first made to
TongaSat by APT through IOT. Thereafter, the reimbursement date
shall coincide with the quarterly payment date for the license fee
to TongaSat as set forth in clause (b) above and shall cover Loral
Orion's share of the license fee and the interest expense on the
Orbital Slot Prepayment for the relevant quarter.
PROPRIETARY
APT and Loral Orion agree that except as set forth in this Paragraph
9.5, no other amounts shall be payable by Loral Orion with regard to
the Orbital Slot, except as may be incurred by Loral Orion with
respect to its participation in coordination activities as
contemplated by Paragraph 9.1.1 above.
ARTICLE 10
LANDING RIGHTS
10.1 APT and Loral Orion will each cooperate with, and assist the other,
on a reasonable best efforts basis, in obtaining such consents, and
otherwise complying with such requirements, as may be required or
imposed, from time to time, by the governments of the People's
Republic of China and the United States in connection with the use
of transponders on the Satellite, in each case to the extent such
approval or compliance is needed for a Party's transponders to be
allowed to provide service in the People's Republic of China or the
United States, respectively.
10.2 Each of APT and Loral Orion agrees, and each will require any
lessee, sub-lessee or user of any transponder to agree, to restrict
its use of the transponders to transmission only for any lawful
purpose and agrees to comply in all material respects with all
applicable laws and government regulations.
ARTICLE 11
SUCCESSOR SATELLITE RENEWAL
11.1 Loral Orion shall have the right, but not the obligation, to
participate in the ownership of up to forty-six percent (46%) of the
transponder capacity on the successor satellite, if any, to the
Satellite or the number of transponders on Loral Orion's Payload at
the End of Life of the Satellite, whichever is greater; provided it
exercises such right by giving written notice thereof to APT no
later than three (3) years before the scheduled End of Life of the
Satellite, as notified by APT in writing to Loral Orion.
11.2 The terms and conditions of such participation shall be
substantially similar to the terms hereof (including but not limited
to transponder types and specific transponder assignments and rights
with respect to a successor satellite) except the percentage of cost
to be borne by Loral Orion shall be equal to the percentage of its
ownership interest in the successor satellite (e.g., Loral Orion
will bear 46% of the cost if its ownership interest in the successor
satellite is 46%) and for appropriate adjustments based on satellite
capabilities and cost; provided however that if Loral Orion shall
participate in less than forty percent (40%) of Adjusted Transponder
Capacity, the price shall not be at cost, but rather shall be
calculated using a cost-plus formula based on the percentage of
Adjusted Transponder Capacity taken up, as follows:
PROPRIETARY
Percentage of Adjusted Transponder Capacity Price Calculation
------------------------------------------- -----------------
1 - 4% Cost plus 40%
5 - 9% Cost plus 35%
10 - 14% Cost plus 30%
15 - 19% Cost plus 25%
20 - 24% Cost plus 20%
25 - 29% Cost plus 15%
30% - 34% Cost plus 10%
35 - 39% Cost plus 5%
40% - 100% Cost
11.3 "Adjusted Transponder Capacity" shall equal
(a) the amount of the transponder capacity on the Satellite, if the
transponder capacity on the successor satellite is greater than the
transponder capacity on APSTAR V; or
(b) the transponder capacity on the successor satellite, if the
transponder capacity on the successor satellite is less than the
transponder capacity on APSTAR V.
11.4 If APT decides not to launch a replacement satellite into the
Orbital Slot having capacity and capability that is the same as or
better than that of the Satellite, Loral Orion shall be offered the
first opportunity to replace the Satellite, including assignment,
subject to any necessary consents, of the TongaSat and ChinaSat
orbital slot agreements and any other relevant licenses so that
replacement can occur before the End of Life of the Satellite. If
such assignment cannot be effected in whole or in part, then APT and
Loral Orion shall enter into an agreement to enable Loral Orion to
use the Orbital Slot with respect to such license rights which
cannot be assigned. If Loral Orion launches a replacement satellite,
APT shall have the same rights, mutatis mutandis, as Loral Orion to
participate in the ownership of capacity in the successor satellite
as set forth in Paragraphs 11.1 through 11.3 above.
11.5 If the Parties elect to launch a replacement satellite for the
Satellite, then:
(a) APT shall provide the services for such replacement satellite
pursuant to the terms and conditions of a Satellite Services
Agreement substantially similar to the form of the Satellite
Services Agreement dated December 10, 2002 (the "Model Agreement"),
except for price, which the Parties shall negotiate in good faith
based on the principle that the price for the services to be
delivered shall (i) be established at a cost-based rate (as opposed
to a demand-based rate) that is intended to minimize the Parties'
cost basis in their respective transponders, (ii) reflect a service
price / service cost ratio similar to the service price / service
cost ratio created by the Model Agreement, and (iii) take into
account such additional factors as the inflation and satellite
technology changes that have occurred since the Model Agreement was
entered into; and
PROPRIETARY
(b) the Parties agree to enter into a new management agreement with
respect to such replacement satellite on substantially the same
terms and conditions as those contained in the form of Management
Agreement dated December 10, 2002.
ARTICLE 12
EFFECTIVE DATE OF THIS AGREEMENT; NO ASSUMPTION
12.1 This Amended and Restated Agreement shall become effective on the date
(the "Effective Date") that this Agreement is approved by the Bankruptcy
Court.
12.2 [Reserved]
ARTICLE 13
PLEDGES
13.1 Neither APT nor Loral Orion shall have the right to pledge, mortgage,
charge, grant any security interest in or otherwise encumber all or part
of its interest in the Satellite, except for the purpose of security
relating to financing (whether new or existing), and then only provided
that:
(a) such Party shall remain liable for all obligations hereunder relating
to such interest;
(b) the encumbrance shall be subject to any necessary approvals or
restrictions of any relevant governmental authority or telecommunications
administration; and
(c) Either (x) satisfactory arrangements as agreed between the parties
(including a party's lenders) shall have been made to recognize and
protect the rights of the other party under this Agreement and the
Transaction Documents or (y) the rights of such secured party with respect
to any such interest in the Satellite shall at all times be subject to the
rights of the other Party under this Agreement and the other Transaction
Documents.
13.2 Notwithstanding anything to the contrary set forth in Paragraph 13.1
above, Loral Orion agrees that it shall not pledge, mortgage, charge,
grant any security interest in, or otherwise encumber all or part its
interests in any transponders on the Satellite that is then subject to the
APT Leasehold Interest or the Common Elements associated therewith
(collectively any "Lien"), for any purpose except for any Lien incurred
pursuant to the next sentence. Loral Orion agrees that it will submit to
the Bankruptcy Court a request to approve the grant by Loral Orion of a
Lien in favor of APT's banks with respect to Loral Orion's ownership
interest in the APT Transponders and the Remaining Loral Transponders, but
with respect to any Remaining Loral Transponder, only for so long as such
transponder is subject to the APT Leasehold Interest, and to the extent
such approval is obtained, to grant such Lien
PROPRIETARY
in the manner and to the extent so approved provided that the foreclosure
of any such Lien shall be subject to the export control laws and
regulations of the United States.
ARTICLE 14
TRANSFER
14.1 In the event APT or Loral Orion desires to transfer (other than sales to
customers in the ordinary course of business in the form of long term
leases or otherwise) all or part of its interest in the Satellite other
than to an Affiliate, such transfer shall be subject to a right of first
offer in favor of the other party in accordance with the terms, conditions
and procedures of which are set forth in the Management Agreement. A
Party's interest in the Satellite that is subject to any such right of
first offer obligation shall consist, in the case of APT, of the APT
Leasehold Interest and in the case of Loral Orion, of the Loral
Transponders not subject to the APT Leasehold Interest and the Common
Elements. In addition, Loral Orion agrees that any transfer by it of its
ownership interest in the transponders on the Satellite that are subject
to the APT Leasehold Interest shall be accompanied by a concomitant
assignment of its rights and obligations under the APT Lease Agreement.
14.2 In the event the other party declines to exercise its right of first offer
or such right of first offer is not otherwise applicable as provided in
the Management Agreement, the transferring party may transfer its
interests to a third party in accordance with the terms set forth in the
Management Agreement, provided the transferee agrees to be bound by the
relevant terms of this Agreement and the Transaction Documents (but
excluding the APT Lease Agreement, which will be assumed by the transferee
only to the extent permitted under Section 15 of the APT Lease Agreement)
and any necessary governmental approvals required in connection with
maintaining the right to use the Orbital Slot have been obtained.
14.3 In the event APT transfers its interest in the Satellite to a third party,
APT shall remain fully obligated to Loral Orion, regardless of such third
party's agreement to be bound by the terms of this Agreement, with regard
to the performance of all obligations set forth herein that do not pertain
or relate exclusively to the Satellite, including but not limited to
obligations regarding the Orbital Slot, APSTAR I, APSTAR VI, and any
successor satellite.
ARTICLE 15
RELATIONSHIP OF THE PARTIES
The rights and obligations of the parties hereunder shall be individual, not
joint or collective. It is not the intention of the parties to create, nor shall
this be deemed or construed to create a partnership, joint venture, association
or trust, or as authorizing any party to act as an agent, servant or employee
for any other party for any purpose except as explicitly set forth herein.
PROPRIETARY
ARTICLE 16
TAXES
Each of APT and Loral Orion shall be responsible for the payment of any and all
taxes assessed on the construction, use and operation of its respective Payload.
ARTICLE 17
ENTIRE AGREEMENT
This Agreement and the other Transaction Documents together constitute the
entire agreement and understanding between the parties in connection with the
transactions hereby contemplated. The Transaction Documents supersede all
previous agreements, arrangements and understandings between the parties with
regard to such transaction which shall cease to have any further force or
effect. No party is entering into any of the Transaction Documents or any of the
arrangements hereby contemplated in reliance upon any representation, warranty
or undertaking which is not expressly set out or referred to in any of the
Transaction Documents.
ARTICLE 18
TERMINATION AND CERTAIN BANKRUPTCY EVENTS
18.1 This Agreement may be terminated as follows:
(a) By mutual written agreement of the parties;
(b) By either party by written notice to the other and in accordance with
Article 20 hereof in the event of a default by the other party provided
such default meets the requirements stated in said Article 20; and
(c) By the Non-Force Majeure Party, by giving at least thirty (30) days'
prior written notice to the Force Majeure Party, if an event of force
majeure as described in Article 19 below prevents the Force Majeure Party
from performing its fundamental obligations hereunder for a period of more
than 120 days.
18.2 Termination of this Agreement shall not affect: (i) either Party's
obligations under any other Transaction Document, (ii) Loral Orion's title
to the Satellite (including without limitation any Remaining Loral
Transponder for which the APT Leasehold Interest shall have been
terminated as provided in Paragraph 2.4.2), (iii) APT's Leasehold
Interest, or (iv) either party's obligations pursuant to Articles 9, 10,
11, and 13 of this Agreement, which obligations shall expressly continue
for so long as both parties possess an economic interest in the Satellite.
PROPRIETARY
ARTICLE 19
FORCE MAJEURE
19.1 Neither party shall be liable for nonperformance or delays in performance
when caused by acts or events which are beyond the reasonable control of
the delayed party, including but not limited to the following: acts of
God, acts of the public enemy, acts of civil or military authority,
governmental priorities, strikes or other labor disturbances, hurricanes,
earthquakes, fires, floods, epidemics, embargoes, war, and riots. In the
event of any such delay the date of delivery or of performance of the
obligation affected by the force majeure event shall be extended for a
period equal to the effect of time lost by reason of the delay.
19.2 A party claiming delay in delivery or performance due to an event of force
majeure as set forth herein (the "Force Majeure Party") shall send written
notice thereof and a statement of particulars to the other party (the
"Non-Force Majeure Party") within a reasonable time.
19.3 The party affected shall take appropriate measures to minimize or remove
the effects of the event of force majeure and, within the shortest time
possible, shall attempt to resume performance of the obligations affected
by the event of force majeure.
19.4 Each party shall use its reasonable best efforts to minimize the losses
and damages caused and/or to be caused to the other party by an event of
force majeure. Both parties shall consult as soon as possible to find an
appropriate solution.
ARTICLE 20
DEFAULT
20.1 Monetary Default. Should either APT or Loral Orion fail to make timely
payment of any amount required hereunder in accordance with the provisions
defined herein, and such failure to pay shall have continued for a period
of three (3) months, the party in breach shall pay interest to the other
party at the 30-day LIBOR rate plus two percent (2%) per annum in respect
of the amounts in arrears. Such interest shall be calculated on a daily
basis from the date payment was due until the date payment is received by
the non-breaching party. Should the party in breach continue to fail to
make such payment for a period of nine (9) months in the aggregate, then
in addition to the interest amount due from the breaching party, the other
party shall have the right to terminate this Agreement and to claim
damages from the party in breach in accordance with the provisions of
Paragraph 20.4 hereof.
20.2 Non-Monetary Default. Should either APT or Loral Orion fail to cure a
material breach of any provisions of this Agreement (other than provisions
regarding payment of monies, which are provided for in Paragraph 20.1
above) within forty-five (45) days after receipt of written notice from
the other party outlining such breach, then the other, non-breaching party
shall have the right to terminate this Agreement (but, for the
PROPRIETARY
avoidance of doubt, without prejudice to the APT Leasehold Interest) and
to claim damages from the party in breach in accordance with the
provisions of Paragraph 20.4 hereof.
20.3 In the event Loral Orion fails to make timely payment of any amount due on
a Termination Date pursuant to Paragraph 3.1, APT shall retain its
leasehold interest in the related Remaining Loral Transponders (and all
other Remaining Loral Transponders for which payment has not yet been made
in full) and all proceeds therefrom and shall not be required to obtain
Loral Orion's consent to enter into commercially reasonable lease
agreements for such Remaining Loral Transponders, even if such lease or
other rights would extend beyond the relevant Termination Date but Loral
Orion's consent right with respect to future lease agreements which extend
beyond the relevant Termination Date shall be reinstated at such time as
it shall have cured its payment default. If such delay continues for a
period of nine (9) months after the scheduled Termination Date, Loral
Orion shall no longer be entitled to terminate the APT Leasehold Interest
in the relevant Remaining Loral Transponders as provided in Paragraph
2.4.2 of this Agreement.
20.4 If the other party suffers any cost, liability or loss as a direct result
of a material breach of this Agreement by any party, and such breach shall
not have been cured by such party within forty-five (45) days from receipt
of notice of breach, the party in breach shall indemnify and hold the
non-breaching party harmless in respect of any such cost, liability or
loss; provided always, however, that in no event shall a party be liable
under any theory of tort, contract, strict liability, or other legal or
equitable theory, for any indirect, special, incidental, or consequential
loss or damage (including without limitation, loss of profit or business
opportunity).
ARTICLE 21
CONFIDENTIALITY
21.1 No press release, announcement or disclosure to a third party concerning
the transactions contemplated hereby will be made by any party hereto
without the prior consent of the other party hereto, except as such
release, announcement or disclosure may be:-
(a) required by law or the rules of any applicable securities exchange;
(b) necessary to be made to a party's lenders for financing purposes
provided that such lenders agree to maintain the confidentiality of
any such disclosed information on customary and reasonable terms; or
(c) is or becomes publicly known, otherwise than as a consequence of a
breach of this Agreement.
PROPRIETARY
21.2 The parties have entered into a Confidentiality Agreement covering
disclosure of information that may be made in connection with the
parties' performance under the Transaction Documents. The rights and
obligations thereunder shall apply to all such proprietary
information disclosed in the implementation or performance of this
Agreement.
ARTICLE 22
ASSIGNMENT
This Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and permitted assigns. Neither
this Agreement nor any of the rights or obligations hereunder may be assigned
without the prior written consent of the other party except for (i) assignments,
in whole or in part, to an Affiliate, provided that notwithstanding any such
assignment to an Affiliate, the assigning party shall, unless otherwise
consented to by the other party, nevertheless remain responsible for all
obligations hereunder; and (ii) assignments by way of security to any entity for
the purpose of security relating to financing, subject to compliance with the
requirements of Article 13 hereof, or otherwise with the written consent of the
other Party. In the event that APT shall wish to assign its rights and
obligations hereunder to an Affiliate, it may do so, provided however that Loral
Orion will not be adversely affected or prejudiced by any assignment or
delegation by APT to its Affiliate of its rights and obligations under the MII
and OFTA filings and under the license agreements with TongaSat and ChinaSat
with respect to the Orbital Slot.
ARTICLE 23
GOVERNING LAW
This Agreement and the Transaction Documents will be governed by and construed
in accordance with the laws of the State of New York without giving effect to
the choice of law principles therein.
ARTICLE 24
DISPUTE RESOLUTION
In the event that a dispute arises out of or relates to this Agreement, Loral
Orion and APT shall attempt to resolve such dispute through friendly
consultation. If the parties are unable to resolve the matter in dispute through
consultation within thirty (30) days following the date on which one party's
request for consultation is delivered to the other party, the parties shall
resolve the dispute through arbitration. The party shall submit the dispute to
arbitration in Singapore to the Singapore International Arbitration Centre for
resolution in accordance with the arbitration rules of that body, in which
case:-
(a) there should be three (3) arbitrators (one appointed by each party and the
third arbitrator appointed by the Singapore International Arbitration
Centre);
PROPRIETARY
(b) all proceedings in any such arbitration shall be conducted in English; and
(c) any such arbitration award shall be final and binding on the parties.
A dispute arising under this Agreement may be consolidated with any arbitration
proceeding relating to the other Transaction Documents, and vice versa. The
arbitrators may not limit, expand or otherwise modify the terms of this
Agreement or award exemplary or punitive damages or attorney's fees. The
arbitrators shall apply the substantive (not the conflicts) law of the state
specified in the governing law provision set forth in Article 23 above. The
award shall be in U.S. Dollars. Judgment upon the award rendered in the
arbitration may be entered in any court having jurisdiction thereof. Unless
otherwise determined by the arbitration award, each party shall bear its own
expenses (including attorney's fees) and an equal share of the expenses of the
arbitrators and the fees of the Singapore International Arbitration Centre. The
parties shall require that the arbitrators and the arbitral body shall hold the
existence, content and result of the arbitration in confidence. Nothing in this
clause shall be construed to preclude any party from seeking injunctive relief
in order to protect its rights pending arbitration. A request by a party to a
court for such injunctive relief shall not be deemed a waiver of the obligation
to arbitrate.
ARTICLE 25
NOTICES
Any notice, request, demand, waiver, consent, approval or other communication
required or permitted to be given hereunder shall be in writing and shall be
delivered by hand, by facsimile (with confirmation of receipt), or by DHL or
other comparable international courier service, return receipt required, as
follows:-
If to Loral, to:
Loral Orion, Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile No.: 000-000-0000
Attention: General Counsel
PROPRIETARY
If to APT, to:
APT Satellite Company Limited
Rooms 3111-3112
Xxx Xxxxxxx Xxxxx
00 Xxxxxxxxx
Xxxx Xxxx
Facsimile No.: 852-2522-0419
Attention: Xx. Xxxxx Xx and Xx. Xx Xxxx Xxxx
or to such other address as the addressee may have specified in a notice duly
given to the sender as provided herein. Such notice, request, demand, waiver,
consent, approval or other communication will be deemed given when so delivered
by hand or faxed, or two business days after being sent in the case of
international courier service.
ARTICLE 26
MISCELLANEOUS
26.1 Headings
The headings in this Agreement and the Annexes are inserted for
convenience of reference only and shall not constitute a part hereof.
26.2 Severability
Any provision of this Agreement which is invalid or unenforceable in any
jurisdiction shall be ineffective to the extent of such invalidity or
unenforceability without invalidating or rendering unenforceable the
remaining provisions hereof, and any such invalidity or unenforceability
in any jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.
26.3 Expenses
Except as specifically provided otherwise in this Agreement, the parties
hereto shall pay all of their own expenses relating to the transactions
contemplated by this Agreement, including, without limitation, the fees
and expenses of their respective counsel, accountants and financial
advisors.
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26.4 Time of the Essence
Time shall be of the essence of this Agreement, both as regards the dates
and periods specifically mentioned and as to any dates and periods which
may be substituted by agreement in writing of the parties.
26.5 Amendment
No variation or amendment of this Agreement shall be valid unless it is in
writing and signed by or on behalf of both parties to this Agreement.
26.6 Waivers
No failure or delay by any party in exercising any right or remedy
provided by law under or pursuant to this Agreement shall impair such
right or remedy or be construed as a waiver or variation of it or preclude
its exercise at any subsequent time and no single or partial exercise of
any such right or remedy shall preclude any other or further exercise of
it or the exercise of any other right or remedy.
26.7 Counterparts
This Agreement may be executed in one or more counterparts, each of which
shall be deemed an original and all of which together shall constitute one
and the same document.
26.8 Survival of Obligations
The obligations of the Parties under this Agreement which by their nature
logically would be expected to survive termination, cancellation, or
expiration of this Agreement, including without limitation those set forth
in Paragraphs 9, 10, 11, 13, 15, 17, 18, 20, 23, 24, 25, and 26, shall
survive termination, cancellation, or expiration of this Agreement for the
applicable time period specified in such section or, if no time period is
specified, for a reasonable period of time under the circumstances.
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THIS AMENDED AND RESTATED AGREEMENT HAS BEEN SIGNED THIS 26th DAY OFAUGUST,
2003, AND CONFORMED TO REFLECT THE AMENDMENTS SET FORTH IN THE SETTLEMENT
AGREEMENT DATED NOVEMBER 16, 2003.
APT SATELLITE COMPANY LIMITED LORAL ORION, INC.
By:_________________________________ By:_______________________________
Name: Name:
Title: Title:
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SCHEDULE 1
DEFINITIONS
In this Agreement the terms set forth hereinafter shall have the meanings
defined in this Article:
"Action" means any action, suit or proceeding at law or in equity,
arbitration, inquiry, investigation or governmental, administrative,
regulatory or other proceeding by or before any governmental entity.
"Adjusted Transponder Capacity" shall have the meaning set forth in
Paragraph 11.3.
"Affiliate" means, with respect to any Person, any other Person directly
or indirectly controlling, controlled by or under common control with such
Person. For purposes of the immediately preceding sentence, the term
"control" (including, with correlative meanings, the terms "controlling",
"controlled by" and "under common control with"), as used with respect to
any Person, means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of such
Person, whether through ownership of voting securities, by contract or
otherwise.
"Agreement" means this agreement (including the Schedules and Annexes
hereto), as the same may be amended, modified or supplemented from time to
time in accordance with its terms.
"APSTAR I" means the satellite with 24 C-Band transponders located at
geostationary orbital slot at 138 degrees east longitude.
"APSTAR VI" means the new satellite based on a SB4000 model satellite with
38 C-band and 12 Ku-band transponders to be built and delivered to APT by
Alcatel Space Industries.
"APT Transponders" shall mean all transponders on the Satellite that are
not identified as Loral Transponders.
"APT" shall have the meaning set forth in the preamble to this Agreement.
"APT Lease Agreement" shall mean the Satellite Transponder Agreement
referred to in the recitals to this Agreement.
"APT Leasehold Interest" shall have the meaning set forth in Paragraph 2.1
hereof.
"ChinaSat" means China Telecommunications Broadcast Satellite Corporation.
"Common Elements" means the elements on the Satellite that are common to
and/or shared by the Loral Orion Payload and the APT Payload.
"Confidentiality Agreement" means the confidentiality agreement entered
into by APT and Loral Orion on December 10, 2002 with respect to the
confidentiality of proprietary
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information relating to the Satellite, as such contract may be amended
from time to time in accordance with its terms.
"Effective Date" shall have the meaning set forth in Article 12 hereof.
"End of Life" means the date on which the actual orbital maneuver life of
a satellite is permanently terminated.
"Force Majeure Party" shall have the meaning set forth in Paragraph 19.2
hereof.
"Hong Kong" means the Hong Kong Special Administrative Region of the PRC.
"Initial Loral Transponders" shall mean the 17 Loral Transponders which
are not subject to the APT Leasehold Interest as described in Paragraph
2.4.1 hereof.
"Ground Equipment Contract" means the contract which was entered into
between APT and SS/L as of August 26, 2003 for the purchase of certain
ground equipment and certain associated services.
"Intentional Ignition" has the meaning set forth in the SS/L Contract.
"Knowledge" means actual knowledge after reasonable inquiry and
investigation.
"Launch Agency" means the provider responsible for conducting the launch
services for the Satellite pursuant to the Launch Services Agreement.
"Launch Services" has the meaning set forth in the SS/L Contract.
"Launch Services Agreement" or "LSA" means the contract dated December 20,
2002 entered into by SS/L, APT and Sea Launch Limited Partnership, which
contract provides for launch services for the Satellite, as such contract
may be amended from time to time in accordance with its terms.
"Launch Vehicle" has the meaning set forth in the SS/L Contract.
"LIBOR" means the rate of interest per annum, at any relevant time, at
which thirty (30) day U.S. dollar deposits are offered at such time in the
London interbank market.
"Loral Orion" shall have the meaning set forth in the preamble to this
Agreement.
"Loral Transponders" shall have the meaning set forth in Paragraph 2.2
hereof.
"Management Agreement" means the agreement entered into by APT and Loral
Orion on December 10, 2002 with regard to the joint management of the use
and operation of the transponders on the Satellite, as such contract may
be amended from time to time in accordance with its terms.
"Marketing Agreement" means the agreement entered into by APT and Loral
Orion on December 10, 2002 with regard to the marketing of the Remaining
Loral Transponders prior to their take up by Loral Orion, as such contract
may be amended from time to time in accordance with its terms.
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"MII" means the Ministry of Information Industries of the PRC.
"Non-Force Majeure Party" shall have the meaning set forth in Paragraph
19.2 hereof.
"OFTA" means the Office of Telecommunication Authority in Hong Kong.
"Orbital Slot" means the geostationary orbital slot located at 138 degrees
east longitude.
"Orbital Sub-License Agreement" means the orbital slot sub-license
agreement dated August 26, 2003 entered into between APT and Loral Orion.
"Party" or "Parties" shall mean APT and/or Loral Orion.
"Payload" of a party means the transponders on the Satellite to which such
party has title free of the APT Leasehold Interest, in the case of Loral
Orion, or leasehold interest, in the case of APT, on the date in question.
"Person" means any individual, partnership, joint venture, trust,
corporation, limited liability entity, unincorporated organization or
other entity (including a governmental entity).
"PRC" means the People's Republic of China, excluding, for purposes of
this Agreement only, Hong Kong, Macau and Taiwan.
"Related Orion Agreement" shall mean the agreement dated June 30, 2003
entered into between SS/L and Loral Orion, pursuant to which among other
things, Loral Orion agrees to pay a portion of the purchase price of the
Satellite, including the Launch Services, under the SS/L Contract as such
contract may be amended from time to time in accordance with its terms.
"Remaining Loral Transponders" shall mean all the Loral Transponders other
than those which are identified and designated as Initial Loral
Transponders.
"Satellite" means the SS/L FS 1300 satellite designated to be built by
SS/L pursuant to the SS/L Contract.
"Services Agreement" means the agreement entered into by APT and Loral
Orion dated December 10, 2002 with regard to the TT&C, Access Management
and Coordination services to be provided by APT for the Satellite, as such
contract may be amended from time to time in accordance with its terms.
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"SS/L" shall have the meaning set forth in the preamble to this Agreement.
"SS/L Contract" means the satellite procurement contract dated as of
January 8, 2001, between APT and SS/L, as such contract may be amended
from time to time in accordance with its terms.
"Slot License Agreement" shall have the meaning set forth in Paragraph 9.5
hereof.
"Subsidiary" of a specified Person means any corporation or other entity
of which securities or other ownership interests having ordinary voting
power to elect a majority of the Board of Directors or other Persons
performing similar functions are directly or indirectly owned by such
Person.
"Termination Date" shall have the meaning set forth in Paragraph 2.4.2
hereof.
"TongaSat" means Friendly Islands Satellite Communication Ltd. of the
Kingdom of Tonga.
"Transaction Documents" means this Agreement, the Management Agreement,
the Services Agreement, the Marketing Agreement, the Confidentiality
Agreement, the APT Lease Agreement and the Orbital Sub-License Agreement.
"TT&C" means telemetry, tracking and command.
PROPRIETARY
