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EXHIBIT 10.1
Certain portions of this document have been omitted and filed separately with
the Securities and Exchange Commission pursuant to Rule 24b-2 of the Securities
Exchange Act of 1934.
SATELLITE CONTRACT
(ECHOSTAR VII - 119(DEGREE) WEST LONGITUDE)
BETWEEN
LOCKHEED XXXXXX CORPORATION
AND
ECHOSTAR ORBITAL CORPORATION
JANUARY 27, 2000
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THIS SATELLITE CONTRACT (the "Contract") dated as of the 27th day of
January 2000, made between Lockheed Xxxxxx Corporation (hereinafter referred to
as "Contractor"), a corporation organized under the laws of the State of
Maryland, having its principle place of business at 0000 Xxxxxxxx Xxxxxx,
Xxxxxxxxx, Xxxxxxxxxx, 00000, and EchoStar Orbital Corporation (hereinafter
referred to as "Buyer"), a corporation organized under the laws of the State of
Colorado, having its principle place of business at 0000 Xxxxx Xxxxx Xx Xxxxx,
Xxxxxxxxx, Xxxxxxxx, 00000-0000.
WHEREAS, Buyer desires to purchase and Contractor desires to provide a
Direct Broadcast Satellite (the "Satellite" or "Spacecraft") and services as
hereinafter specified, and Buyer and Contractor (hereinafter referred to as
"Parties") desire to define the terms and conditions under which the same shall
be furnished;
NOW THEREFORE, the Parties hereto, in consideration of the mutual covenants
herein expressed, agree as follows:
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TABLE OF CONTENTS
ARTICLE
-------
1 Scope of Work
2 Equipment and Services to be Furnished and Prices Therefor
3 Delivery Schedule
4 Payment
5 (Reserved)
6 In-Orbit Incentive Payments
7 Inspection and Final Acceptance
8 Title and Assumption of Risk
9 Access to Work
10 Progress Meetings, Presentations, and Documentation Deliverables
11 Rights in Data
12 Public Release of Information
13 Indemnification
14 Patent Indemnity
15 Indemnification for Taxes
16 Excusable Delays
17 Termination for Default
18 Termination for Convenience
19 Changes
20 Assignment
21 Warranty
22 Arbitration
23 Applicable Law
24 Entire Agreement
25 Disclosure and Use of Information by the Parties
26 Effective Date
27 Permits and Licenses
28 Limitation of Liability
29 Spacecraft Test and Handling Equipment
30 Liquidated Damages
31 Spacecraft Storage
32 Survival
33 Insurance
34 Interparty Waiver of Liability
35 Cooperation Regarding Spot Beams
36 Dry Mass Penalty
37 Key Personnel
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ARTICLE 1. SCOPE OF WORK
A. The Contractor shall provide the necessary personnel, material, services,
and facilities to perform work in accordance with the provisions of this
Contract, including the ATTACHMENTS hereto, which are made a part hereof,
and the EXHIBITS listed below, which are attached hereto and made a part
hereof and to make Delivery to Buyer of the equipment and services set
forth in ARTICLE 2 hereof in accordance with the Delivery schedule
specified in ARTICLE 3 hereof:
EXHIBIT A: EchoStar VII Statement of Work (SOW) 8575922
EXHIBIT B: EchoStar VII Spacecraft Performance Specification 8575921
EXHIBIT C: EchoStar VII Test Plan 8575920
EXHIBIT D: A2100 Program Product Assurance Plan PN-8569826 Rev N/C
In the event of any inconsistency among or between the parts of this
Contract set forth above, such inconsistency shall be resolved by giving
precedence in the order of the parts as set forth below:
1. Terms & Conditions, Spacecraft Contract Dated January 27, 2000,
including ATTACHMENT A hereto
2. EchoStar VII Statement of Work, EXHIBIT A
3. EchoStar VII Spacecraft Performance Specification, EXHIBIT B
4. EchoStar VII Test Plan, EXHIBIT C
5. A2100 Program Product Assurance Plan, EXHIBIT D
B. In the event that, thirty (30) days after EDC, the TBDs in the EchoStar VII
Spacecraft Performance Specification, EXHIBIT B, and the TBDs set forth in
ARTICLE 2 have not been agreed to by both Parties or such Performance
Specification is not otherwise finalized to the mutual satisfaction of the
Parties, then notwithstanding ARTICLE 18. TERMINATION FOR CONVENIENCE, or
any other provision in this Contract, Buyer may immediately terminate this
Contract by providing written notice to Contractor. In full and final
settlement of such termination Contractor shall retain the first milestone
payment amount of DOLLARS ($XXXXXXX) paid to Contractor at fifteen (15)
days after EDC and all other liabilities and obligations of the Parties
shall be released, waived and terminated.
C. Contractor agrees to fly the Spacecraft until the earlier to occur of: (i)
the material anomaly(ies) being resolved; (ii) insurance for the material
anomaly(ies) being paid to Buyer; or (iii) Buyer informing Contractor that
it desires to use the Spacecraft for commercial purposes (provided that, in
such instance, Contractor shall continue to fly the Spacecraft until such
time as the material anomaly(ies) is fully understood and Buyer has been
trained how to fly the Spacecraft in such anomalous condition). Provided,
however Buyer shall use its reasonable commercial efforts to include in the
policy for insurance of the Spacecraft, that, "The Spacecraft
manufacturer's efforts concerning Spacecraft rescue, anomaly resolution and
flying time will be covered by the Underwriters."
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ARTICLE 2. EQUIPMENT AND SERVICES TO BE FURNISHED AND PRICES THEREFOR
A. Upon the full, satisfactory and timely completion and Delivery, as
required, of each item of work specified below, and acceptance by Buyer
thereof in accordance with the requirements of this Contract, Contractor
shall be entitled to payment by Buyer of the applicable fixed price
specified below in accordance with terms and conditions of this Contract,
as such price may be adjusted in accordance with the provisions of the
Contract. The prices stated below, which are inclusive of the In-Orbit
Incentives and include all transportation and related charges for Delivery
of Spacecraft and associated equipment to destination and all Launch
("Launch" means the launch of the Spacecraft as defined in the launch
services agreement the Buyer enters into with the launch service provider
or in the event of a change from one Launch provider to another, then the
definition will be changed to that Launch provider who actually launches
the Spacecraft, and which definition Buyer will provide to Contractor upon
request) and mission support and services through In-Orbit Test (IOT) which
includes post IOT support as specified in EXHIBIT A. Except as otherwise
provided for herein, the prices stated below include all applicable taxes
and all copyright and patent rights necessary to effectuate this Contract.
Item Quantity Description Total Price
---- -------- ----------- -----------
1. 1 Spacecraft as defined $XXXXXXXX (i)
in EXHIBIT B
2. 1 Lot Launch and mission support services for NSP
Spacecraft on an Atlas IIIB launch vehicle
3. 1 Lot Optional additional CONUS Transmit $XXXXXXX
reflector and Feed System
for Spot Beams for less than or
equal to 10(degree)from 119(degree)X.X.
4. 1 Lot Optional additional CONUS Transmit $XXXXXXX
reflector, Receive reflector and Feed System
for Spot Beams for more than
10(degree)from 119(degree)X.X.
5. 1 Lot Optional Satellite Control $XXXXXXX
Facility ("SCF") Equipment, Software,
Setup and Training
6. 1 Lot Optional incremental costs to
Item 1, in support of a Launch from either an Ariane,
or a Proton or a SeaLaunch, Launch at their
respective locations:
6a. 1 Lot Optional incremental cost for Launch out of $XXXXXXX
Kourou, French Guiana on an Ariane Launch
6b. 1 Lot Optional incremental cost for Launch out of $XXXXXXX
Baikonur, Kazakhstan on a Proton Launch
6c. 1 Lot Optional incremental cost for Launch out of $XXXXXXX
Long Beach, CA on a SeaLaunch (Zenit)
TOTAL PRICE $XXXXXXX (ii)
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(i) Total Price for Spacecraft, including without limitation the cost of
Delivery of Spacecraft to Cape Canaveral, Florida.
(ii) Does not include the price of the Optional items.
B. The Spacecraft will include some imported goods. In the event the
Spacecraft and its included imported goods are not exported in a timely
manner due to the actions or inactions of Buyer, any duties and penalties
arising therefrom will be the responsibility of Buyer. Contractor shall pay
such above duties and penalties as may be required by law to be so paid and
Buyer agrees to reimburse the Contractor for payments so made; provided
that Contractor uses reasonable commercial efforts to challenge the
imposition of such duties and penalties and keeps Buyer reasonably apprised
of its activities in that regard.
C. Contractor shall be entitled to an early Delivery incentive payment for
each day the Spacecraft is delivered to the Launch site prior to the
Delivery date set forth in ARTICLE 3. DELIVERY, provided Buyer is given
three (3) months prior notice of the early Delivery date, by an amount of
$XXXXXXX per day for days 1 through 60 and $XXXXXXX for each day
thereafter, up to a maximum of $XXXXXXX. In the event Contractor is
entitled to an early Delivery incentive payment in accordance with this
paragraph, the amount of any such incentive shall be added to the Contract
price, and Buyer shall make payment of same to Contractor, ninety (90) days
after Launch of the Spacecraft, and in the event the Spacecraft is placed
into Storage, Buyer shall make payment of same to Contractor ninety (90)
days after it is placed into Storage. Notwithstanding the above, Contractor
shall not be entitled to an early Delivery incentive payment in the event
Contractor is the cause of a Launch delay.
D. Option for additional CONUS Transmit Reflector and Feed System for Spot
Beams for less than or equal to ten (10) degrees from 119 degrees X. X.
Buyer may exercise this option by providing Contractor authorization to
proceed, at a specific orbital location, no later than thirty (30) days
after EDC. Additionally, Buyer shall have the option, exercisable in its
discretion by providing written notice to Contractor, at any time until ten
(10) months after EDC (or later if Buyer and Contractor mutually agree to
an equitable adjustment, or to the deletion of testing as necessary in
order to maintain schedule), to direct Contractor to commence integration
and test of either the baseline antenna set or this Optional CONUS Transmit
Reflector and Feed System for Spot Beams for installation on the
Spacecraft, without affecting schedule. In the event Buyer desires to
exercise this Option subsequent to the date(s) specified above, but prior
to twenty-three (23) months following EDC, then the price for the Option
and the Delivery schedule shall be subject to equitable adjustments. The
Contractor shall use reasonable care to mitigate any impacts to the price
and/or delivery schedule. [AT LEAST 3 INTERIM MILESTONES TBD]
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E. Option for additional CONUS Transmit Reflector, Receive reflector and Feed
System for Spot Beams for more than ten (10) degrees from 119 degrees X.X.
Buyer may exercise this option by providing Contractor authorization to
proceed, at a specific orbital location, no later than thirty (30) days
after EDC. Additionally, Buyer shall have the option, exercisable in its
discretion by providing written notice to Contractor, at any time until ten
(10) months after EDC (or later if Buyer and Contractor mutually agree to
an equitable adjustment, or to the deletion of testing as necessary in
order to maintain schedule), to direct Contractor to commence integration
and test of either the baseline antenna set or this Optional CONUS Transmit
Reflector, Receive reflector and Feed System for Spot Beams for
installation on the Spacecraft, without affecting schedule. In the event
Buyer desires to exercise this Option subsequent to the date(s) specified
above, but prior to twenty-three (23) months following EDC, then the price
for the Option and the Delivery schedule shall be subject to equitable
adjustment. The Contractor shall use reasonable care to mitigate any
impacts to the price and/or delivery schedule. [AT LEAST 3 INTERIM
MILESTONES TBD]
F. Optional Satellite Control Facility. Buyer shall have the option,
exercisable at its discretion by providing Contractor authorization to
proceed, no later than nine (9) months after EDC, to purchase the following
SCF equipment, software, setup and training at the price set forth above:
Item Description Qty Redundant
1 Satellite Control Center n/a n/a
1a - Real Time System/Remote 2 2:1
User Interface
2 Baseband TT&C n/a n/a
2a - CR&T Unit 2 2:1
3 O&M Documentation 2 sets n/a
4 Design Review 1 n/a
5 Installation and Test of n/a n/a
Hardware
6 Training (described below) n/a n/a
Documentation Delivery (no design doc):
1 SOW
2 Performance Spec
3 Test Plan
4 Compliance Matrix
5 Design Review Material
6 Test Procedure(s)
7 Current Version(s) of
Hardware O&M Manual(s)
8 Current Version(s) of
Software O&M Manual(s)
9 Shipping Lists/Export
Paperwork
10 Test Report(s)
11 Closeout Package
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NOT INCLUDED:
1 ICS (scripts)
2 DSS or STS
3 Monitor & Control system
(p/o Antenna/RF)
4 Mission Analysis Software
5 Antenna/RF System
6 Command Encryption
7 Source Code
8 Design Documentation
9 Consoles (Desk Top)
10 Spares
TRAINING COURSE DESCRIPTIONS:
SPACECRAFT ANALYST (15 DAYS). This course shall present, in detail, the
design and operation of each of the A2100 satellite bus subsystems. The
design of the payload subsystem shall be presented to the extent that the
payload influences satellite bus design and operations. This course shall
be primarily for satellite engineers.
SPACECRAFT CONTROLLER (10 DAYS). This course shall describe in detail
ground console operation and use of the on-station operating instructions
and procedures for the satellite bus and payload subsystems. Operating
instructions for the communications subsystem shall be covered in a summary
fashion.
GROUND SYSTEM OPERATIONS AND MAINTENANCE (5 DAYS). This course shall detail
the operation and maintenance of the A2100 Ground System including
operation and interfaces of the computer, status and control, baseband, and
antenna/RF subsystems. This course shall be primarily for the Ground
Systems O&M engineer.
G. Option to select a Launch other than an Atlas IIIB. Buyer, after entering
into a launch services agreement with the Launch provider, may exercise
this option by providing Contractor authorization to proceed with any one
of the Launch vehicles listed in Item 6, in lieu of an Atlas IIIB Launch,
at the applicable price increase to Item 1. price no later than 12 months
after EDC for the Ariane or Proton, without affecting schedule. In the
event that a SeaLaunch is selected then the latest date by which that
Option may be exercised without affecting schedule is 10 months after EDC.
In either case the coupled loads analysis as well as a mission analysis
plan will not be available until after the Launch provider is contracted
for by Buyer, as delineated in EXHIBIT A.
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ARTICLE 3. DELIVERY SCHEDULE
A. "Delivery", in the case of the Spacecraft, shall mean delivery of the
Spacecraft, at Contractor's expense, to the applicable Launch site and, in
the case of all other equipment, shall mean delivery of such equipment, at
Contractor's expense, to the applicable delivery destination.
B. Delivery shall be as indicated below:
Item Description Delivery Date
---- ----------- -------------
1. Spacecraft as defined in EXHIBIT B. 12/20/2001
2. Launch and Mission Operation Support Services Commencing on Delivery of
the Spacecraft to the Launch
Site and Continuing Through
On Orbit Check-out and all
mission support costs and
services through IOT together
with post IOT support as
specified in EXHIBIT A
3 1 Lot Optional additional CONUS Transmit
Reflector and Feed System
for Spot Beams for less than or
equal to ten (10) degrees from
119 degrees X.X. As provided in ARTICLE 2,
Paragraph D.
4. 1 Lot Optional additional CONUS Transmit
Reflector, Receive Reflector and Feed System
for Spot Beams for more than 10(degree)
from 119(degree)X.X. As Provided in ARTICLE 2,
Paragraph E.
5. 1 Lot Optional Satellite Control Fourteen (14) months
Facility ("SCF") Equipment, Software, after exercise of option
Setup and Training
6. 1 Lot Optional incremental Delivery days to
be added to Item 1, in support of a Launch from
either an Ariane, or a Proton or a
SeaLaunch, Launch at their
respective locations
6a. 1 Lot Optional incremental Delivery days for Launch plus one (1) day
out of Kourou, French Guiana on an
Ariane Launch
6b. 1 Lot Optional incremental Delivery days for Launch plus two (2) days
out of Baikonur, Kazakhstan on a Proton Launch
6c. 1 Lot Optional incremental Delivery days for Launch No Change
out of Long Beach, CA on a SeaLaunch (Zenit)
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ARTICLE 4. PAYMENT
A. The total price stipulated in ARTICLE 2. EQUIPMENT AND SERVICES TO BE
FURNISHED AND PRICES THEREFOR, as such price may be adjusted in
accordance with the provisions of the Contract, shall be paid by Buyer
to Contractor in accordance with the payment arrangements specified for
the construction payments in the Spacecraft Payment Plan set forth in
paragraph B of this ARTICLE (the "Payment Plan"), and the payment
arrangements for the In-Orbit Incentives described in paragraph C of
this ARTICLE and ARTICLE 6. IN-ORBIT INCENTIVE PAYMENTS. Except for the
first two construction payments, which will be paid at the dates set
forth below, the amounts specified in the Payment Plan shall in each
case be paid by Buyer to Contractor on the dates indicated; provided
that: (i) Contractor submits an invoice for each payment no later than
thirty (30) days in advance of the payment due date; and (ii)
Contractor completes the applicable milestone no later than three (3)
business days in advance of the payment due date. Notwithstanding the
foregoing, in the event that Contractor does not deliver an invoice to
Buyer at least thirty (30) days prior to the applicable payment date
and/or does not achieve the relevant milestone, or provide a
work-around that does not affect schedule and is otherwise acceptable
to Buyer, at least three (3) business days prior to the applicable
payment date, Buyer may suspend construction payments until such time
as the relevant invoice is received and milestone is completed. Within
thirty (30) days following Buyer's receipt of the relevant invoice or
three (3) business days following Contractor's completion of the
relevant milestone, whichever occurs later, Buyer shall pay Contractor
for all construction payments that were required to have been made but
were not as a result of the suspension.
All payments required to be made to Contractor under this Contract
shall be made by either cable transfer to Citibank N.Y. ABA# 000000000,
Lockheed Xxxxxx, A/C #38469306, or by check payable to Lockheed Xxxxxx
Corporation sent by overnight mail carrier (at Contractor's expense) to
the address and attention of the Lockheed Xxxxxx representative
designated in ARTICLE 10, PROGRESS MEETING, PRESENTATIONS AND
DOCUMENTATION DELIVERABLES, paragraph C.
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B. SPACECRAFT PAYMENT PLAN
1. The construction payments applicable to Spacecraft shall be made as
follows:
MILESTONE PAYMENT SCHEDULE FOR ECHOSTAR VII SPACECRAFT
--------------------------------------------- ------------------- ------------------------- -----------------------
MILESTONE DESCRIPTION* MONTHS AFTER EDC AMOUNT, $ CUMULATIVE
AMOUNT, $
--------------------------------------------- ------------------- ------------------------- -----------------------
Initial Payment 15 days after EDC $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
Agreement on the TBDs in EXHIBIT B and the 1 $ XXXXXXX $ XXXXXXX
TBDs set forth in ARTICLE 2
--------------------------------------------- ------------------- ------------------------- -----------------------
Complete 1st Monthly report & Program 2 $ XXXXXXX $ XXXXXXX
Kick-Off
--------------------------------------------- ------------------- ------------------------- -----------------------
Place Subcontractor orders** 3 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
Deliver Program Management Plan 4 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
Conduct System PDR 5 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
First Quarterly Management Report & 6 $ XXXXXXX $ XXXXXXX
Spacecraft/Launch Vehicle Kick-off
--------------------------------------------- ------------------- ------------------------- -----------------------
Select Spacecraft Harness Vendor 7 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
Complete Payload ICD & Start Panel Design 8 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
Conduct System CDR 9 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
Start Antenna Integration & Test 10 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
Start Electronics Box I&T 11 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
Start Propulsion Subsystem I&T 12 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
Deliver OMUX's to SV 13 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
Deliver CORE to PSS I&T 14 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
Deliver Electronic Boxes to B159 15 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
Deliver Solar Array and Batteries to B159 16 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
Deliver TWTAs to SV 17 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
Complete Payload Initial Turn-Ons 18 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
Complete Spacecraft Mate 19 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
Deliver Mission Ops Plan 20 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
Complete Vibration Test *** 21 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
Complete Thermal/Vacuum Test *** 22 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
Complete Range Test 23 $ XXXXXXX $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
PSR and Spacecraft Final Acceptance 24 $ XXXXXXX
--------------------------------------------- ------------------- ------------------------- -----------------------
* Work arounds that do not affect schedule and are otherwise acceptable to Buyer
will satisfy the milestone event.
Notwithstanding the above milestones, if it becomes reasonably clear that
problems with deliverables are reasonably likely to cause schedule delays, then
the construction payments may
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be suspended, at Buyers option, and the date for payment of each subsequent
construction payment delayed, by an amount of time equal to the difference
between the Delivery date for the Spacecraft set forth in ARTICLE 3 above and
the revised forecast Delivery date. In the event that Contractor subsequently
recovers all or a portion of the originally scheduled Delivery date, the
construction payments will again be revised to reflect that recovery. Further,
if, following completion of a milestone, a problem arises which requires rework
of elements of the milestone, then all construction payments may be suspended,
at Buyer's option, until the milestone is again complete.
** Subcontractor List (see below)
Subcontractor List
----------------------------------- -----------
Description Quantity
----------------------------------- -----------
Structure (core & panels) 1
----------------------------------- -----------
Arcjets 4
----------------------------------- -----------
PCU 1
----------------------------------- -----------
Tanks 5
----------------------------------- -----------
OMUXes 12
----------------------------------- -----------
IMUXes 9
----------------------------------- -----------
Command Receivers 3
----------------------------------- -----------
Beacon Transmitters 3
----------------------------------- -----------
OBC 1
----------------------------------- -----------
LAE 1
----------------------------------- -----------
REAs 18
----------------------------------- -----------
Battery Cells 78
----------------------------------- -----------
TWTAs 60
----------------------------------- -----------
*** In the event the Program Managers of Contractor and Buyer jointly agree to
conduct Thermal Testing prior to Vibration Testing, then the order of these
milestones shall be reversed.
2. In the event of earlier Delivery of the Spacecraft, and
provided the proper notice of early Delivery was provided,
then Buyer shall use its reasonable efforts to pay the
remaining construction payments promptly following receipt of
Contractor's invoice therefor as provided in paragraph A of
this ARTICLE.
C. Spacecraft In-Orbit Incentive Payments
1. In addition to the construction payments described above,
Buyer shall pay In-Orbit Incentives in the aggregate amount of
$XXXXXX, plus interest at X% per annum, to Contractor in
accordance with the requirements set forth in ARTICLE 6 below.
2. The Parties are willing to enter into good faith negotiations
to establish an alternative to the payment schedule set out in
ARTICLE 6 for the In-Orbit Incentives including without
limitation, prepayment. Buyer shall have the right to
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prepay, at any time, without penalty, that amount of the
In-Orbit Incentives outstanding. In the event of prepayment of
In-Orbit Incentives, if there is subsequently a reduction in
the amount of In-Orbit Incentives that would have otherwise
been due Contractor, then the Contractor shall pay Buyer for
the reduced performance, calculated from the date of
prepayment by Buyer to the subsequent date of repayment by
Contractor, at a rate of X% per annum
D. Failure to make any payments required hereunder, shall constitute a
default by Buyer subject to the provisions of ARTICLE 17. TERMINATION
FOR DEFAULT, paragraph F.
E. 1. For the Spacecraft delivered by Contractor which, following
Launch, does not achieve Successful Injection, as a result of
a Launch vehicle failure unrelated to the Spacecraft defined
in ARTICLE 6, Contractor shall be entitled to receive
$XXXXXXX, which payment is in lieu of and in full satisfaction
of the In-Orbit Incentives.
For purposes of this paragraph, the Spacecraft shall be deemed
to have been "Successfully Injected" provided that:
(a) at the time of separation from the launch vehicle,
the transfer orbit perigee altitude error, apogee
altitude error, inclination error, argument of
perigee error, Spacecraft attitude, and Spacecraft
spin are within or equal to +/-3 sigma limits of
their specified values; and
(b) the Spacecraft has not suffered damage as a
consequence of a failure or malfunction of the launch
vehicle or other cause that is not the fault or is
beyond the control of Contractor.
Notwithstanding that the transfer orbit does not meet all of
the criteria stated in paragraph E(1)(a) above, the Spacecraft
shall be deemed to have been Successfully Injected if the
Spacecraft has nevertheless been positioned in its orbital
slot as defined in EXHIBIT B, Spacecraft Performance
Specification, and the then remaining calculated operation
time period is equal to or greater than 13 years.
2. In the event Buyer is obligated to make payment to Contractor
in accordance with paragraph 1 above, payment shall be due
within ten (10) days from Buyer's receipt of the insurance
proceeds.
F. Except in the case of a bona fide dispute, in the event that either
Party fails to make any payment required hereunder when due, such
payment shall bear interest at the rate of X% per annum until paid.
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ARTICLE 5. (RESERVED)
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ARTICLE 6. IN-ORBIT INCENTIVE PAYMENTS
6.1 In addition to the construction payments described in ARTICLE 4, Buyer
will pay the Contractor in orbit incentives in the aggregate amount of
XXXXXXX Dollars ($XXXXXXX), plus interest at X% per annum accruing from
the completion of the IOT review, for the in-orbit performance of the
Satellite as set forth herein (the "In Orbit Incentives").
6.2 The In Orbit Incentives will be payable in thirteen (13) equal annual
payments, the first such payment becoming due on the last day of the
month during which the one year anniversary of the completion of the
IOT review occurs, provided that no payment shall be due any sooner
than thirty (30) days following receipt of an invoice therefor from
Contractor.
6.3 Except as provided below, the criteria for determining a loss pursuant
to pages 5 through 11 (inclusive) of the commercial insurance policy
that Buyer procured with respect to the launch and operation of the
EchoStar V satellite, copies of which are attached hereto as ATTACHMENT
A (the "Criteria"), shall be utilized by Contractor and Buyer to
determine the extent, if any, to which Contractor's In Orbit Incentives
are reduced, if at all. Buyer and Contractor agree that the Criteria
will be utilized for the duration of this Contract. The formula to
determine losses will, in the sole discretion of Buyer (regardless of
the mode of operation at the time or the number of licensed
frequencies), be based upon, notwithstanding the Criteria: (i) with
respect to full CONUS payload, on either 32 transponders operating at
high power mode with a Stated Spacecraft Life of 13 years, not subject
to the Deductible, or 16 transponders operating at super high power
mode with a Stated Spacecraft Life of 13 years, not subject to the
deductible; and (ii) with respect to the spot beam payload, on 25
transponders with a Stated Spacecraft Life of 13 years, not subject to
the Deductible. The entire amount of the $XXXXXXX of In Orbit
Incentives shall be at risk of being reduced based on failures of the
full CONUS payload. In addition, $XXXXXXX of the In Orbit Incentives
shall be at risk of being reduced based on failures of the spot beam
payload. So, for example, in the event of the failure of a transponder
which results in only 15 full CONUS transponders operating at super
high power being available, in addition to any adjustment to the In
Orbit Incentives pursuant to paragraph 6.6, the In Orbit Incentives
would be reduced by XX x $XXXXXXX x (the number of days of remaining
life at the time of the failure/4,745). If the same transponder failure
resulted in only 13 available spot beam transponders, then the In Orbit
Incentives would be further reduced by 13/25 x $XXXXXXX x (the number
of days of remaining life at the time of the failure/4,745). Each
reduction to the In Orbit Incentives shall be applied on an equal basis
to all annual payments subsequent to the occurrence of the underlying
failure/anomaly.
In the event that Buyer obtains launch/operation insurance for the
Spacecraft ("EchoStar VII Insurance"), if application of the criteria
in the EchoStar VII Insurance Policy would result in a larger reduction
in the In Orbit Incentives than application of the Criteria
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would, then the reduction in the In Orbit Incentives will be based on
the criteria in the EchoStar VII Insurance Policy.
6.4 If any anomaly with respect to the Satellite would result in a loss
under the Criteria, then Contractor's In Orbit Incentives shall be
reduced by a percentage equal to the percentage loss which would be
payable in accordance with the Criteria. In the case of a conflict or
inconsistency between the terms of this Section 6.4 and Section 6.3
above, the Parties agree that only one Section can apply to any
particular failure/anomaly and that Buyer shall choose, in its sole
judgment, which Section shall apply each particular failure/anomaly.
6.5 If the cumulative losses pursuant to this ARTICLE 6 are equal to or
greater that 50%, then the Satellite shall be considered a total loss,
and Contractor's In Orbit Incentives shall be reduced to zero.
6.6 If an anomaly occurs with respect to the Satellite which would not
result in a loss under the Criteria, or with respect to which Buyer
does not believe the loss amount fairly reflects the consequences of
the anomaly, then the amount of In Orbit Incentives due to Contractor
may nonetheless be further reduced as provided below, if the anomaly:
(1) would cause commercial insurers to demand terms, conditions or
rates for continued insurance which are greater than would be required
for a satellite which does not experience such an anomaly, or (2)
results in a reduction in the fair market value of the Satellite.
Contractor and Buyer shall jointly agree on the amount of any such
reduction of the In Orbit Incentives, taking into account the
anticipated degradation of the Satellite or of its life as a result of
the anomaly, any reduction in its value over such term as a result of
the anomaly, the extent to which Contractor is able to devise ways and
methods to overcome the impacts of such anomaly, and any increased
costs to Buyer as a result of the anomaly.
For example (and not by way of limitation), if tubes on the Spacecraft
experience failures, the exact nature of which, and the timing of
additional numbers of failures which, can not be predicted with
certainty, and/or with respect to which redundancies on the Spacecraft
allow continued operation of all frequencies, then even if commercial
insurers would claim that the number of failures to date, together with
the number of potential future failures, is not sufficiently certain to
result in a loss under the Criteria (or should result in only a small
loss under the Criteria), a further reduction in the In Orbit
Incentives would none-the-less occur based on the guidelines in the
paragraph above.
6.7 If Contractor and Buyer are unable to agree whether an event as
described in Paragraph 6.3, 6.4 or 6.6 above has occurred, or on the
appropriate amount payable, the parties shall submit the matter to
binding arbitration as provided for in ARTICLE 22.
6.8 If at the time an In Orbit Incentive payment is due, a potential
reduction of the In Orbit Incentives is pending, then the payment date
shall be delayed until 30 days following
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resolution of the potential reduction. Notwithstanding the prior
sentence, Buyer shall timely pay any amounts reasonably likely to be in
excess of the value of the potential reduction.
6.9 If an anomaly which results in a loss is caused by Buyer's operation of
the Satellite outside of the appropriate criteria established by
Contractor or by a Launch Vehicle failure that is not caused by the
Satellite, then no reduction in the In-Orbit Incentive payments shall
be made for such anomaly. Further, if either of these two events occur,
and the Satellite becomes a total loss under this ARTICLE 6, then Buyer
shall pay to Contractor all In Orbit Incentives (less any reductions as
a result of anomalies or amounts previously paid) within thirty (30)
days after Buyer receives payment from its insurance carrier.
6.10 Unless Launch is delayed due to the fault of Contractor, if the
Satellite is not launched within one hundred eighty (180) days after
Delivery and final acceptance pursuant to ARTICLE 7, Buyer shall
commence making In Orbit Incentive payments in accordance with the
above as though the IOT review of the Satellite had been completed
after the one hundred and eightieth (180th) day after Delivery and
final acceptance pursuant to ARTICLE 7.
6.11 Notwithstanding anything to the contrary above, in no event shall the
reduction in In-Orbit Incentives exceed the amount of unearned In-Orbit
Incentives remaining due from Purchaser to Contractor at the relevant
point in time.
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ARTICLE 7. INSPECTION AND FINAL ACCEPTANCE
A. Inspection
Buyer, or its designated representative, shall have the right to
witness and review the results of the final acceptance testing at the
system level of the deliverable hardware at the facilities of
Contractor. To allow Buyer to most effectively schedule the monitoring
stated above, Contractor shall give Buyer reasonably timely
notification of the acceptance testing of the deliverable hardware.
B. Final Acceptance
Final acceptance of the items to be delivered hereunder shall be in
accordance with the requirements of this Contract, including the
EXHIBITS. Delivery and final acceptance shall be as provided herein.
1. The Spacecraft furnished under this Contract shall be tested
by Contractor in the presence of Buyer or Buyer's
representative, and in the case of Spacecraft to be delivered
to storage, shall be finally accepted by Buyer upon
demonstration at Contractor's facility, prior to Delivery of
Spacecraft to storage, by means of test results obtained
pursuant to the test requirements set forth in EXHIBIT C, that
the Spacecraft meets the performance specifications set forth
in EXHIBIT B for the Spacecraft.
2. In the case of Spacecraft delivered for launch, upon arrival
of Spacecraft at the Launch site, as required by EXHIBIT A for
the Spacecraft, Contractor shall promptly conduct an
inspection and test the Spacecraft, in accordance with the
requirements of EXHIBIT C, in the presence of Buyer or Buyer's
representative.
3. However, in paragraphs 1 and 2 above, Contractor may conduct
the test without the Buyer's presence providing Buyer or
Buyer's representative is notified within a reasonable time
before the test is to be conducted. At the written request of
the Contractor, Buyer or Buyer's representative shall either
finally accept the Spacecraft in writing or notify Contractor
in writing of those particulars in which the Spacecraft to be
delivered does not meet the requirements of this Contract. For
the purposes of paragraph 2 above, this action shall take
place no later than forty-eight hours after Buyer or Buyer's
representative has received the final Launch System
Performance Test (LSPT) Test Data. Upon remedy of such
particulars to meet the requirements of this Contract, the
Spacecraft shall be deemed to have been Delivered and finally
accepted. Notwithstanding the above, if Buyer or Buyer's
representative is not present and Contractor presents the test
results to Buyer and Buyer does not respond within three (3)
business days, the final acceptance will have been deemed to
have taken place.
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4. Final acceptance of items other than the Spacecraft shall take
place after Delivery by Contractor to the applicable delivery
destination and, if required by Contract, completion of
installation and inspection. Contractor shall promptly conduct
an inspection and, if required, test the items other than the
Spacecraft, in accordance with the requirements of EXHIBIT C,
in the presence of Buyer or Buyer's representative. However,
Contractor may conduct the test without the Buyer's presence
providing Buyer or Buyer's representative is notified within a
reasonable time before the test is to be conducted. At the
written request of the Contractor, Buyer shall either finally
accept the item(s) in writing or notify Contractor in writing
of those particulars in which the items to be delivered do not
meet the requirements of this Contract. Upon remedy of such
particulars to meet the requirements of this Contract, the
item involved shall be deemed to have been Delivered and
finally accepted. Notwithstanding the above, if Buyer or
Buyer's representative is not present and Contractor presents
the test results to Buyer and Buyer does not respond within
three (3) business days, the final acceptance will have been
deemed to have taken place.
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ARTICLE 8. TITLE AND ASSUMPTION OF RISK
A. Unless otherwise stated herein, the following shall apply:
1. Title and risk of loss or damage to a Spacecraft shall pass to
Buyer at Launch, even in the case of a Spacecraft delivered to
storage.
2. Title and risk of loss or damage to items other than
Spacecraft shall pass to Buyer upon final acceptance.
B. Buyer agrees to cause its insurer(s) to waive all rights of subrogation
against Contractor and its officers, agents, servants, subsidiaries and
employees, subject to terms and conditions as are then customarily
available regarding such waivers.
C. EXCEPT WITH RESPECT TO WILLFUL MISCONDUCT OR GROSS NEGLIGENCE BY
CONTRACTOR, UPON AND AFTER LAUNCH OF THE LAUNCH VEHICLE FOR THE
SPACECRAFT, CONTRACTOR'S SOLE FINANCIAL RISK, AND THE SOLE AND
EXCLUSIVE REMEDIES OF BUYER, WITH RESPECT TO THE USE OR PERFORMANCE OF
THE SPACECRAFT, SHALL BE AS SET FORTH IN ARTICLES 6, 13, 14, 15 AND 21.
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ARTICLE 9. ACCESS TO WORK
A. For the purpose of observing the quality of Contractor's performance of
work, Contractor shall afford a reasonable number of Buyer's personnel
(including without limitation Buyer's consultants) access, with office
facilities as delineated in EXHIBIT A, to all work in process at
Contractor's facilities. Upon Buyer's request, Contractor will request
and attempt to obtain similar access to work related to Buyer's
Spacecraft that is being performed at Contractor's major
subcontractors.
B. The Contractor shall use reasonable commercial efforts to obtain the
U.S. Governments' authorization to allow Telesat Consultants access to
the same extent as delineated in paragraph A above. Additionally,
Contractor shall apply for and, once issued, use reasonable commercial
efforts to maintain all U.S. Government export licenses and approvals
needed for Buyer's personnel, representatives, agents and consultants
who are citizens of a country other than the U.S., to access Contractor
facilities or technical data in connection with the performance of this
Contract as delineated in paragraph A above. Buyer shall cooperate with
Contractor and provide the support necessary for Contractor to apply
for and maintain such export licenses and approvals, and shall promptly
notify Contractor of any occurrence or change in circumstances of which
it becomes aware that is relevant to or affects such export license and
approvals.
C. Information disclosed to Buyer pursuant to this ARTICLE shall be
subject to the limitations set forth in ARTICLE 25. DISCLOSURE AND USE
OF INFORMATION BY THE PARTIES.
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ARTICLE 10. PROGRESS MEETINGS, PRESENTATIONS AND DOCUMENTATION DELIVERABLES
A. Meetings and Presentations
In addition to any other meetings called for under the provisions of
this Contract and without limitation thereto, Contractor shall provide
the manpower, facilities, materials and support required to conduct the
following periodic meetings and presentations:
1. Informal Program Manager meetings.
2. Technical Review meetings as determined by Contractor's
Program Manager.
3. Quarterly Summary Executive Reviews.
Copies of view graphs or other documents utilized during these meetings
shall be furnished or be made available to Buyer. Buyer's management
personnel, as may be deemed appropriate by Buyer, shall be invited to
the Quarterly Summary Executive Reviews. Contractor shall be
represented by its Program Manager and such other personnel as are
specifically required to support the particular presentation. All
periodic meetings shall be held at Contractor's facilities at either
Sunnyvale, CA or Newtown, PA, or such other locations that the Parties
shall mutually agree to.
B. Distribution of Reports
All materials, reports and documentation furnished pursuant to this
ARTICLE shall be the property of Buyer subject to the limitations set
forth in ARTICLE 25, DISCLOSURE AND USE OF INFORMATION BY THE PARTIES,
except that, Contractor or its subcontractors may retain copies for
their own purposes, including the using of such materials and reports
in the performance of other contracts.
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C. Correspondence
All correspondence, including notices, reports and documentation
deliverables, to be provided to Buyer or Contractor under this Contract
shall be sent in writing to Buyer or Contractor, signed by the Party
issuing them, and sent by either: (i) facsimile transmission; (ii)
first class certified mail, postage prepaid; or (iii) overnight courier
service, charges prepaid, to the Party to be notified, addressed to
such Party at the address set forth below, or sent by facsimile to the
fax number set forth below, or such other address or fax number as such
party may have substituted by notice given to the others in accordance
with this paragraph C. The sending of such notice with confirmation or
receipt thereof (in the case of facsimile transmission) or receipt of
such notice (in the case of delivery by certified mail or by overnight
courier service) shall constitute the giving thereof.
EchoStar Orbital Corporation Lockheed Xxxxxx Corporation
0000 Xxxxx Xxxxx Xx Xxxxx 0000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000-0000 Sunnyvale C.A, 94089
Attention: Xx. X. Xxxxx Attention: Xx. X. XxXxxxx
Fax: 000-000-0000 Fax: 000-000-0000
CC: Mr. Xxxxx Xxxxxxxxx
Fax: 000-000-0000
CC: Xx. Xxxxx Xxxxxx
Fax: 000-000-0000
D. The only representatives of Buyer and Contractor authorized to sign
contractual documents are:
BUYER: CONTRACTOR:
Xx. X. Xxxxx Xx. X.X. Xxxxxxxx
Xx. X. Xxxxxxxxx Xx. X. Xxxxx
Xx. Xxxxxx XxXxxxx
Mr. P.H. Xxxxxxx
Or others authorized by written Or others authorized by
delegation of the Board of written delegation by
Directors of EchoStar Orbital Lockheed Xxxxxx Corporation
Corporation
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ARTICLE 11. RIGHTS IN DATA
A. Except as provided in paragraph B below, Buyer shall have an unlimited
right to use, duplicate, and disclose the information contained in the
Spacecraft Operations Manual (SOM) furnished pursuant to EXHIBIT A for
the Spacecraft, however, if any written material furnished as part of
said document is copyrighted, Buyer shall have an unlimited right to
make copies of such copyrighted material and to use such copies for any
Buyer purpose associated with the operation of the Spacecraft without
payment of additional compensation to Contractor to the extent that
Contractor has the authority to grant such right. In the event
Contractor does not have such right, Contractor will exert its best
efforts to obtain such rights for Buyer.
B. All data that are or may be delivered or disclosed by either party to
the other shall be subject to ARTICLE 25, DISCLOSURE AND USE OF
INFORMATION BY THE PARTIES.
C. Notwithstanding any other provision hereof, the ownership and title to
copyrights and computer programs and their related documentation
delivered to Buyer by Contractor in accordance with this Contract shall
remain in Contractor or its licensor. Contractor shall grant to Buyer a
paid up non-exclusive, non-transferable license to use (including "to
duplicate" and "to adapt") solely for use in connection with this
Contract, the copies of computer programs and their related
documentation specified in the Contract required for the operation of
the Spacecraft delivered under this Contract.
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ARTICLE 12. PUBLIC RELEASE OF INFORMATION
During the term of this Contract, neither Party, its affiliates,
subcontractors, employees, agents and consultants shall release items of
publicity of any kind, including, without limitation, news releases, articles,
brochures, advertisements, prepared speeches, company reports or other
information releases, related to the work performed hereunder, including the
denial or confirmation thereof, without the other Party's prior written consent
which consent shall not be unreasonably withheld. Notwithstanding the foregoing
either Party may disclose the existence and the purpose of this Contract to the
extent required by any laws, rules, or regulations.
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ARTICLE 13. INDEMNIFICATION
A. Each party shall defend the other party and its officers, agents,
servants, subsidiaries and employees, and any of them, from and against
all claims, actions, suits and proceedings (collectively "Claims")
alleging damage to any property, private or public, and injuries,
including death, to persons caused by any act or omission of the
indemnifying Party and/or the indemnifying Party's agents or
representatives at any tier or any of them, and, notwithstanding the
provisions of Article 28, shall pay any final judgment or settlement,
provided the indemnifying Party is given prompt written notice of any
such Claim and full authority to resist, defend and settle such Claim.
The indemnified Party shall provide at the indemnifying Party's request
such assistance and information as may be required the indemnifying
Party. The indemnifying Party shall in no event be liable for any costs
or expenses incurred without its written authorization.
B. Other than as provided in ARTICLES 6, 13, 14, 15 and 21, upon and after
Launch of the launch vehicle for the Spacecraft, Contractor shall not
be liable to Buyer, customers of Buyer or their customers for any
damages resulting from: (i) any loss or destruction of the Spacecraft;
or (ii) failure of the Spacecraft or its subsystems to operate
satisfactorily, except any such liabilities, losses and damages that
are caused by the gross negligence or willful misconduct of Contractor.
Buyer also agrees to cause its insurers to waive all right of
subrogation against Contractor and its officers, agents, servants,
subsidiaries and employees, subject to terms and conditions as are then
customarily available regarding such waivers.
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ARTICLE 14. PATENT INDEMNITY
A. Contractor shall defend Buyer and its officers, agents, servants,
subsidiaries and employees, and any of them from and against all Claims
alleging that the manufacture of any Spacecraft, delivered under this
Contract or the use, lease, sale or other disposition of any such
Spacecraft infringes any U.S. patent, and, notwithstanding ARTICLE 28,
shall pay any final judgment or settlement, provided Contractor is
given prompt written notice of any such Claim and full authority to
resist, defend and settle such Claim. Buyer shall provide at
Contractor's request such assistance and information as may be required
by Contractor.
B. If an injunction or other order is obtained against the manufacture,
use, lease, sale or other disposition of any Spacecraft hereunder,
Contractor agrees to use its best efforts either to procure rights so
that such Spacecraft and the manufacture, use, lease, sale or other
disposition thereof is no longer infringing or to modify or replace
such Spacecraft so that it is no longer subject to such order. In the
event that such injunction or order becomes permanent and that neither
of the foregoing alternatives is suitably accomplished and Contractor
is unable to reasonably perform its obligations hereunder, Buyer may
terminate this Contract and receive a refund of all amounts paid to
Contractor hereunder.
C. Contractor shall in no event be liable for any costs or expenses
incurred without Contractor's written authorization and, except in the
case of gross negligence or willful misconduct, in no event shall
Contractor's total liability to Buyer under, or as a result of
compliance with, the provisions of this ARTICLE exceed the aggregate
Spacecraft price for all Spacecraft under construction or delivered.
The foregoing states the entire warranty by Contractor and the
exclusive remedy of Buyer, with respect to any alleged patent
infringement by such product or part.
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ARTICLE 15. INDEMNIFICATION FOR TAXES
Contractor shall assume responsibility, and shall defend Buyer, its
officers, agents, employees, servants, subsidiaries and assignees, or any of
them, from and against all Claims arising out of, or relating to, taxes, which
may be required under present federal, state, or local laws and which become due
by reason of the performance of work under this Contract, and, notwithstanding
the provisions of Article 28, shall pay any final judgment or settlement
(including without limitation any interest or penalties), provided Contractor is
given prompt written notice of any such Claim and full authority to resist,
defend and settle such Claim, and Contractor shall execute and deliver such
other and further documents, 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. Buyer shall provide at Contractor's request such assistance and
information as may be required by Contractor. The indemnifying Party shall in no
event be liable for any costs or expenses incurred without its written
authorization. It is Contractor's belief that no sales, use, income or personal
property taxes will be incurred under this Contract as presently structured. In
the event that Buyer directs changes which result in the assessment of sales,
use, income or personal property taxes which would not be payable absent such
direction, Buyer shall be responsible for such taxes.
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ARTICLE 16. EXCUSABLE DELAYS
Without limiting any other provision specifying what constitutes an
excusable delay under this Contract, acts of God or of the public enemy; acts of
the Government in its sovereign or contractual capacity, including Government
priorities, allocations, regulations or orders affecting materials, facilities,
or completed Spacecraft (including changes in the launch specifications); fires;
floods; snowstorms; earthquakes; epidemics; quarantine restrictions; strikes;
wars; freight embargoes; or any similar events which cause failure or delay to
perform hereunder, and in every case are beyond the reasonable control and
without fault or negligence of a Party or its subcontractors hereunder shall
constitute an excusable delay, if notice thereof is given to the other Party as
soon as possible but in no event later than within thirty (30) days after such
event shall have occurred. In the event of a delay resulting from any of the
above causes, the Delivery requirement shall be extended for the period of the
excusable delay.
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ARTICLE 17. TERMINATION FOR DEFAULT
A. Buyer may, by written notice of default sent to Contractor in
accordance with paragraph C of ARTICLE 10, terminate the whole or any
part of this Contract in any one of the following circumstances:
1. If Contractor fails to make Delivery of the supplies or to
perform the services within the time specified herein.
2. If Contractor fails to perform any of the other provisions of
this Contract or so fails to make progress as to endanger
performance of this Contract in accordance with its terms, and
in either of these two circumstances does not act to correct
such failure within a period of thirty (30) days (or such
longer period as Buyer may authorize in writing) after receipt
of notice from Buyer specifying such failure.
B. To the extent the Contract is terminated under this ARTICLE, Buyer
shall use all reasonable efforts to utilize all work in process
hereunder in order to mitigate any costs sustained by Buyer as a result
of Contractor's default. Contractor will pay to Buyer all costs
reasonably incurred by Buyer in obtaining all of the work described in
this Contract, according to the schedule set forth herein, provided
that Buyer enters into a contract for such work within twelve (12)
months of Contractor's default.
C. If this Contract is terminated as provided in this ARTICLE, Contractor
shall promptly refund all payments made by Buyer for the terminated
work, except that Buyer shall remain liable to Contractor for and pay
Contractor: (a) the Contract price for completed items which are
Delivered to Buyer and finally accepted by Buyer pursuant to ARTICLE 7;
and (b) the cost of, and a reasonable profit on, all work in process,
materials in stock and services for which Buyer takes Delivery and
which Buyer finally accepts pursuant to ARTICLE 7.
D. If this Contract is terminated as provided in this ARTICLE, Contractor
shall protect and preserve property in the possession of Contractor in
which Buyer has an interest.
E. Absent gross negligence or willful misconduct, the remedies set forth
in this ARTICLE, and ARTICLES 6, 13, 14, 15, 21 and 30, shall be the
sole recourse to which Buyer is entitled, under paragraph 1or paragraph
2 above, in the event of Contractor's default, and Contractor shall
have no liability for special, indirect, incidental or consequential
damages for lost profits or lost revenues.
F. In the event Buyer fails to perform any obligation which it is required
to perform pursuant to this Contract, Contractor may, if such failure
is not corrected within thirty (30) days after written notice of such
failure is given by Contractor to Buyer in accordance with paragraph C
of ARTICLE 10, halt work on this Contract and consider this entire
Contract to be terminated due to the default of Buyer. In the event
that Contractor terminates this
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Contract pursuant to this paragraph F, Contractor shall be entitled to
compensation as set forth in ARTICLE 18, TERMINATION FOR CONVENIENCE.
Absent gross negligence or willful misconduct, the remedies set forth
in this paragraph F shall be the sole recourse to which Contractor is
entitled, under this ARTICLE, in the event of Buyer's default, and
Buyer shall have no liability for special, indirect, incidental or
consequential damages for lost profits or lost revenues.
G. If, after notice of termination of the Contractor's right to proceed
under the provisions of this ARTICLE, it is determined for any reason
that the Contractor was not in default under the provisions of this
ARTICLE, or that the delay was excusable under the provisions of
ARTICLE 16, EXCUSABLE DELAYS, the rights and obligations of the Parties
shall be the same as if notice of termination had been issued pursuant
to ARTICLE 18, TERMINATION FOR CONVENIENCE.
H. If, after notice of termination of the Buyer's right to proceed under
the provisions of this ARTICLE, it is determined for any reason that
the Buyer was not in default under the provisions of this ARTICLE, or
that the delay was excusable under the provisions of ARTICLE 16,
EXCUSABLE DELAYS, the rights and obligations of the Parties shall be
the same as if Contractor was terminated for default under this
ARTICLE.
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ARTICLE 18. TERMINATION FOR CONVENIENCE
A. Buyer, by written notice to Contractor, may terminate this Contract in
whole, or in part, for any reason or for Buyer's convenience at any
time prior to final acceptance of all the work. In the event of such
termination, Contractor will cease work as directed in the termination
notice. The termination charges shall be limited to the total direct
costs (including applicable overhead charges) reasonably incurred by
Contractor with respect to termination and settlement with all vendors
and subcontractors , plus a profit of fifteen (15) percent on such
direct costs, and reasonable costs incurred by Contractor in connection
with the reassignment of the personnel involved in the Spacecraft
program (provided that Contractor shall use reasonable commercial
efforts to minimize all of the above-listed costs). In the event of
termination by the Buyer of any deliverable item, it is agreed that the
termination charges shall be negotiated but shall not exceed the total
price for deliverable item set forth in ARTICLE 2, EQUIPMENT AND
SERVICES TO BE FURNISHED AND PRICES THEREFORE, hereof. Notwithstanding
the above, in no event shall the Buyer's liability, under this
paragraph A, exceed the percentage of the total price of the
Spacecraft, as such total price is set forth in ARTICLE 2. EQUIPMENT
AND SERVICES TO BE FURNISHED AND PRICES THEREFORE, which corresponds to
the month such termination occurs in the following schedule:
SPACECRAFT TERMINATION LIABILITY SCHEDULE
------------------- ----------------
% OF TOTAL
MONTHS PRICE OF
AFTER EDC SPACECRAFT
------------------- ----------------
1 XX
------------------- ----------------
2 XX
------------------- ----------------
3 XX
------------------- ----------------
4 XX
------------------- ----------------
5 XX
------------------- ----------------
6 XX
------------------- ----------------
7 XX
------------------- ----------------
8 XX
------------------- ----------------
9 XX
------------------- ----------------
10 XX
------------------- ----------------
11 XX
------------------- ----------------
12 XX
------------------- ----------------
13 XX
------------------- ----------------
14 XX
------------------- ----------------
15 XX
------------------- ----------------
16 XX
------------------- ----------------
17 XX
------------------- ----------------
18 XX
------------------- ----------------
19 XX
------------------- ----------------
20 XX
------------------- ----------------
21 XX
------------------- ----------------
22 XX
------------------- ----------------
23 XX
------------------- ----------------
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B. Direct costs (including applicable overhead charges) and costs incurred
by Contractor in connection with the reassignment of the personnel
involved in the Spacecraft program shall be determined in accordance
with Contractor's standard accounting practice and may be verified, at
Buyer's option and expense, by an independent certified public
accounting firm to be mutually agreed upon by the Buyer and Contractor.
C. Buyer shall pay Contractor the aforesaid termination charges within
thirty (30) days following the submission of an invoice. Upon payment
of Contractor's invoice, Contractor shall deliver to Buyer all
termination inventory which has not been credited by Contractor against
the termination charges set forth in paragraph D.2 below. In the event
that Contractor's invoice is not paid within thirty (30) days following
submission, Buyer shall be in default pursuant to ARTICLE 17,
TERMINATION FOR DEFAULT, paragraph F.
D. Final payment shall be in the amount of the total termination charges,
less the following:
1. Amounts previously paid by Buyer to Contractor with respect to
previously completed work and any terminated work pursuant to
ARTICLE 4. PAYMENT, hereof; and
2. Amounts representing the total of Contractor's costs with
respect to previously completed work and any terminated work
of segregable items of inventory not desired by Buyer and
which Contractor elects to retain for its use.
In the event the amount set forth in this paragraph D above exceeds the
termination charges defined in paragraph A of this ARTICLE, Contractor
shall promptly refund such excess to Buyer.
E. In no event shall the total amount paid to Contractor pursuant to this
Agreement, including termination charges paid pursuant to this ARTICLE,
exceed the total price stated in ARTICLE 2, EQUIPMENT AND SERVICES TO
BE FURNISHED AND PRICES THEREFORE, hereof.
F. The remedies set forth in this ARTICLE shall be the sole recourse to
which Contractor is entitled, under this ARTICLE, in the event of
Buyer's exercise of termination for convenience.
G. Contractor agrees to use all reasonable efforts to assist Buyer in
disposing/selling of the work in process upon termination pursuant to
this ARTICLE.
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ARTICLE 19. CHANGES
Buyer may, from time to time between the EDC and the completion of this
Contract, by written change order issued by Buyer, make changes within the
general scope of this Contract in drawings, designs, specifications, method of
shipment or packing, quantities of items to be furnished, place of Delivery,
postpone Delivery, require additional work, or direct the omission of work. If
any such change causes an increase or decrease in costs of, or the time required
for, the performance of this Contract, an equitable adjustment shall be made in
the price, or Delivery schedule, or both, and any other affected provision, and
this Contract shall be modified in writing accordingly. Any claim by Contractor
for adjustment under this paragraph shall be deemed waived unless asserted in
writing within thirty (30) days from the date of receipt by Contractor of the
change order. The amount of the claim shall be stated when it is submitted, or
at a later date, not to exceed sixty (60) days from the date for assertion of
the claim, which later date shall be requested at the time of such submission.
Unless Contractor has waived its claim, all changes and equitable adjustments
pursuant to this ARTICLE shall be subject to negotiation between and approval by
both Parties prior to the implementation of any such change. Except for
Excusable Delays pursuant to ARTICLE 16. EXCUSABLE DELAYS, none of the Contract
dates will change unless mutually agreed upon in writing by the Parties.
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ARTICLE 20. ASSIGNMENT
A. Neither party shall assign or delegate this Contract or any of its
rights, duties, or obligations hereunder to any other person without
the prior express written approval of the other party, such approval
shall not be unreasonably denied. Nothing contained in this ARTICLE
shall restrict Contractor from subcontracting work or procuring
parts/materials or services in the ordinary course of performance of
this Contract.
B. Buyer may assign this Contract, provided Buyer can reasonably
demonstrate that any such proposed assignee is in at least as good
financial condition as the Buyer at the EDC.
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ARTICLE 21. WARRANTY
A. Contractor warrants that the goods or services furnished hereunder
shall be free from any defects in material or workmanship and shall be
manufactured in conformity with the performance specifications
applicable to such goods and services.
B. Buyer shall have the right at any time during the period of this
warranty and irrespective of prior inspections or acceptance to reject
any goods or services not conforming to the above warranty and require
that Contractor at its expense, correct or replace as promptly as is
reasonably possible, at Contractor's option, such goods or services
with conforming goods or services.
C. For the Spacecraft, this warranty shall run for a period of one (1)
year from the date of final acceptance by Buyer or until Launch,
whichever is sooner. Notwithstanding the foregoing, Contractor shall
investigate any and all anomalies arising during the life of the
Spacecraft, and use reasonable best efforts to correct any such anomaly
that is correctable by Contractor from Buyer's SCF using the facilities
and equipment available at such site.
D. Except for the Spacecraft, this warranty shall run for a period of one
(1) year from the date of final acceptance by Buyer.
E. Contractor shall pass on or assign to Buyer all warranties on goods or
services given by suppliers or manufacturers other than Contractor to
the extent to which Contractor is permitted by the terms of its
purchase contracts with such suppliers or manufacturers.
F. THIS WARRANTY IS IN LIEU OF ALL OTHER WARRANTIES, WHETHER STATUTORY,
EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
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ARTICLE 22. ARBITRATION
A. Any dispute or disagreement arising between the Parties in connection
with any interpretation of any provision of this Contract, or the
compliance or noncompliance therewith, or the validity or
enforceability thereof, or any other dispute under any ARTICLE hereof
which is not settled to the mutual satisfaction of the Parties within
thirty (30) days (or such longer period as may be mutually agreed upon)
from the date that either party informs the other, in writing, that
such dispute or disagreement exists, shall be settled by arbitration in
accordance with the Commercial Arbitration Rules of the American
Arbitration Association, in effect on the date that such notice is
given.
B. Either party which demands arbitration of the controversy shall, in
writing, specify the matter to be submitted to arbitration and, at the
same time, choose and nominate a competent person to act as an
arbitrator; thereupon, within fifteen (15) days after receipt of such
written notice, the other party to this agreement shall, in writing,
choose and nominate a competent arbitrator. The two arbitrators so
chosen shall meet and endeavor to resolve the question in dispute, and,
if they agree upon such determination, the determination so made shall
be in writing and signed by both arbitrators. If such two arbitrators
fail to agree, they shall forthwith select a third arbitrator, giving
written notice to both Parties of the choice so made and fixing a time
and place at which both Parties may appear and be heard with respect to
such controversy. In case the two arbitrators shall fail to agree upon
a third arbitrator within a period of seven (7) days, or if for any
other reason there shall be a lapse in the naming of an arbitrator or
arbitrators, or in the filling of a vacancy, or in the event of failure
or refusal of any arbitrator or arbitrators to attend or fulfill his or
their duties, then upon application by either Party to the controversy,
an arbitrator or arbitrators shall be named by the American Arbitration
Association.
C. The arbitration award made shall be final and binding upon the Parties
and judgment may be entered thereon, upon the application of either
Party by any court having jurisdiction. Subject to any other limitation
of damages set forth herein, the relief that may be awarded by the
arbitrators under any arbitration arising from this Contract may not
exceed actual compensatory damages. In no event may the arbitrators
award punitive damages.
D. Each party shall bear the cost of preparing and presenting its case,
and the cost of arbitration, including the fees and expenses of the
arbitrator or arbitrators, will be shared equally by the Parties unless
the award otherwise provides.
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ARTICLE 23. APPLICABLE LAW
A. This Contract shall be interpreted and enforced in accordance with the
substantive laws of the State of New York, exclusive of its conflict
rules.
B. This Contract is subject to all applicable laws and regulations and
each Party agrees to comply with all such applicable laws and
regulations.
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ARTICLE 24. ENTIRE AGREEMENT
This Contract constitutes the entire agreement between the Parties and
supersedes all prior understandings, commitments, and representations with
respect to the subject matter hereof. It may not be amended, modified, or
terminated (other than as specifically provided in the ARTICLES hereof), and
none of its provisions may be waived, except by a writing signed by an
authorized representative of the Party against which the amendment,
modification, termination or waiver is sought to be enforced. The paragraph
headings herein shall not be considered in interpreting the text of this
Contract.
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ARTICLE 25. DISCLOSURE AND USE OF INFORMATION BY THE PARTIES
A. If documents supplied by one party to the other are marked with a
proprietary legend, the receiving party shall take all necessary steps
to ensure that the documents and contents of such documents are not
disclosed to any person other than a person employed or engaged by the
receiving party, whether under subcontract or otherwise, who has a bona
fide need to know the information contained thereon in order to perform
this Contract. Any such document supplied hereunder shall be returned
to the disclosing party together with any copies thereof promptly upon
written request of the disclosing party, except for one copy to be
retained for legal purposes. Whenever the receiving party makes copies
of such proprietary documents for performance of work covered by this
Contract, the receiving party shall xxxx each such copy as proprietary
to the disclosing party.
B. Any disclosure to any person permitted under paragraph A of this
ARTICLE shall be made under the same conditions that apply to the
initial disclosure and shall extend only so far as may be necessary for
the purposes of this Contract. Any such disclosure to a person other
than an employee of the receiving party shall be made pursuant to a
written confidential disclosure agreement or with prior written
approval of the disclosing party.
C. Except with the written consent of the disclosing party, the receiving
party shall not make use of any document mentioned in paragraph A of
this ARTICLE other than for the purposes of this Contract.
D. The obligations and restrictions imposed by this ARTICLE shall not
apply to the following:
1. information that is or becomes available to the public from a
source other than the receiving party, before or after the
effective date of this Contract;
2. information that is authorized for release in writing by the
disclosing party;
3. information that is lawfully obtained by the receiving party
from a third party;
4. information that is known by the receiving party prior to such
disclosure; and
5. information that is, at any time, developed by the receiving
party completely independently of any disclosure or
disclosures from the disclosing party.
E. Neither party shall be liable for inadvertent or accidental disclosure
of such information marked as proprietary if such disclosure occurs
despite both Parties exercising reasonable efforts to preserve and
safeguard such information.
F. Neither party shall be liable for the disclosure of any proprietary
information of the other party pursuant to any legally enforceable
requirement of the U.S. Government or any
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State or local government, or any agency, or department of any of the
above, or any binding court order.
G. No license, under any patents or any other intellectual property, is
granted or implied by merely conveying data or information under this
Contract.
H. Any proprietary disclosure to either party, if made orally, or
visually, shall be identified as confidential or proprietary at the
time of disclosure, in order for such information to be treated as
proprietary and subject to the restrictions of this ARTICLE 25.
I. The obligations of this ARTICLE shall be effective for a period of
three (3) years from the date of termination or expiration of this
Contract whichever comes first.
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ARTICLE 26. EFFECTIVE DATE
The term Effective Date of the Contract (EDC), as used in this
Contract, shall mean the 27th day of January 2000.
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ARTICLE 27. PERMITS AND LICENSES
A. This Contract is subject to all applicable U.S. laws and regulations
relating to the export of Spacecraft, technical data and other
equipment and services being furnished pursuant to, or to be utilized
in connection with, this Contract (hereinafter in this ARTICLE referred
to as "Licensed Items") and to all applicable laws and regulations of
the country or countries to which Spacecraft, technical data, and other
equipment and services are exported or are sought to be exported.
B. Contractor shall use its best efforts to obtain such U.S. Government
approvals and licenses for export of the "Licensed Items." Buyer shall
not be liable for any additional cost associated with Contractor
processing any export license application for Delivery of any
Spacecraft.
C. If, within a reasonable time, the U.S. Government fails to grant a
required approval or license to Contractor to export the "Licensed
Items" or revokes or suspends such an approval or license subsequent to
its grant, or grants such a license or approval subject to conditions,
this Contract shall, nevertheless, remain in full force and effect. In
the event of such U.S. Government action or inaction, deliveries and
acceptance of all items to be furnished by Contractor shall be made at
locations within the continental U.S. as agreed upon between the
Parties. Such U.S. Government action or inaction shall not otherwise
modify in any way the rights and obligations of the Parties under this
Contract except to relieve Contractor of any obligations which cannot
be performed without such an approval or license and to make the price
and Delivery schedule subject to equitable adjustment in accordance
with ARTICLE 19, CHANGES, to reflect the obligations of which
Contractor is relieved.
D. If, within a reasonable time, any foreign country or countries to which
such "Licensed Items" are sought to be exported fails to grant a
required approval or license or suspends or revokes a required approval
or license subsequent to its grant, or grants a license subject to
conditions, or if any foreign country or countries to which such
"Licensed Items" are exported fails to grant an approval or licenses to
utilize the "Licensed Items" for the purpose for which exported, this
Contract shall, nevertheless, remain in full force and effect. In the
event of such foreign country or countries action or inaction,
deliveries and acceptance of all items to be furnished by Contractor
shall be made at locations within the continental U.S. as agreed upon
between the Parties. Such foreign government action or inaction shall
not otherwise modify in any way the rights and obligations of the
Parties under this Contract except to relieve Contractor of any
obligations which cannot be performed without such an approval or
license and to make the price and Delivery schedule subject to
equitable adjustment in accordance with ARTICLE 19, CHANGES, to reflect
the obligations of which Contractor is relieved.
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ARTICLE 28. LIMITATION OF LIABILITY
ABSENT GROSS NEGLIGENCE OR WILLFUL MISCONDUCT, IN NO EVENT SHALL EITHER
PARTY BE LIABLE, WHETHER IN CONTRACT, TORT OR OTHERWISE, FOR SPECIAL,
INCIDENTAL, INDIRECT OR CONSEQUENTIAL DAMAGES, INCLUDING, WITHOUT LIMITATION,
FOR LOST PROFIT OR REVENUES TO THE OTHER PARTY.
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ARTICLE 29. SPACECRAFT TEST AND HANDLING EOUIPMENT
Contractor shall provide Spacecraft unique test and handling equipment
at the Launch Site, during the period between Delivery of the Spacecraft to the
Launch Site, and final acceptance for use in connection with the inspection and
final acceptance of the Spacecraft pursuant to ARTICLE 7. INSPECTION AND FINAL
ACCEPTANCE. Title to such equipment shall remain with Contractor.
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ARTICLE 30. LIQUIDATED DAMAGES
A. Contractor acknowledges that its failure to Deliver the Spacecraft to
the Launch site on or before the applicable Delivery date set forth in
ARTICLE 3. DELIVERY SCHEDULE, may cause serious damage to Buyer, the
amount of which may be difficult or impossible to prove.
1. The amount of Liquidated Damages applicable to the Spacecraft
shall be $XXXXXXX per day for days 1 though 60 and $XXXXXXX
for each day thereafter, but shall not, absent gross
negligence or willful misconduct, exceed a total of $XXXXXXX.
B. Contractor and Buyer agree that such liquidated damages, without
further proof of same, shall be deemed to represent the damages
actually sustained by reason of such delay.
C. The liquidated damages are intended to be compensatory and do not
constitute a penalty.
D. These amounts are firm, fixed and not subject to adjustment due to
changes in economic conditions. The Contractor's total liability for
late Delivery of the Spacecraft shall not exceed the specified
liquidated damages, absent gross negligence or willful misconduct.
E. Any interval of excusable delays as defined in ARTICLE 16. EXCUSABLE
DELAYS, shall be excluded from the period for which liquidated damages
accrue. However, such time period shall continue at the conclusion of
the excluded interval as if no such interruption had occurred.
F. In the event that liquidated damage are owed by Contractor to Buyer,
Contractor shall make payment of same to Buyer ninety (90) days after
Launch of the Spacecraft, and in the event the Spacecraft is placed
into Storage, Contractor shall make payment of same to Buyer ninety
(90) days after it is placed into Storage.
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ARTICLE 31. SPACECRAFT STORAGE
A. If as a result of a delay or failure to launch, through no fault of
Contractor, Buyer requests Contractor to store the Spacecraft within
sixty (60) days of completion of in-plant acceptance testing, the
Contractor shall store, at a site designated by Buyer and such site
shall be subject to the approval of Contractor, or if no site is
designated by Buyer, at a site designated by Contractor, the Spacecraft
delivered under this Contract. Title and risk of loss to the Spacecraft
to be stored shall remain with Contractor at the storage site.
Contractor shall assume full responsibility for any loss or damage to
the Satellite during ground storage. There shall be no charge for
storage or reverification work if the Contractor's failure to perform
is the reason that the Satellite is stored, or if the Satellite is
stored for less than six (6) months. Should the Satellite be stored for
a reason other than Contractor's failure to perform and the Spacecraft
remains in storage beyond the six (6) month period, Buyer shall be
responsible for all storage costs (in excess of six (6) months) and
shall be responsible for paying directly or reimbursing Contractor for
all direct costs actually incurred by Contractor to re-verify system
flight assurance and reverification testing (in excess of six (6)
months). Contractor shall be responsible, except in the event of
negligence or willful misconduct by the Buyer, for all transportation
cost and insurance to cover the risk and expense of loss or damage of
the Spacecraft in transit, (i) from Contractor's facility to storage,
(ii) from Buyer's facility to the storage site, (iii) from the storage
site to the launch site or (iv) if necessary, from the storage site to
the refurbishment site and then to the launch site.
B. Upon the request of Buyer, the Contractor shall provide periodic
testing, necessary equipment, and environmental maintenance suitable
for prevention of deterioration to the Spacecraft during the period of
storage. Unless the Contractor's failure to perform is the reason that
the Satellite is stored, and except for the first six (6) months that
the Satellite is stored, the cost for such service shall be subject to
ARTICLE 19. CHANGES, and shall be negotiated upon the request of such
services by Buyer. Any deterioration to a Spacecraft while in storage
shall be at Contractor's risk and shall be corrected at Contractor's
expense.
C. If at any time after storage begins, Buyer elects to launch the stored
Spacecraft, the Contractor shall inspect, test and refurbish as
necessary such Spacecraft to a launch-ready condition and arrange for
transit to the launch site as directed by Buyer. The cost for such
services shall be subject to ARTICLE 19. CHANGES, and shall be
negotiated in good faith by the Contractor and Buyer at the time such
services are required.
D. In the event the Spacecraft is placed into storage as a result of a
delay or failure to launch, through no fault of Contractor, Contractor
shall be entitled to commencement of the payment of In-Orbit Incentives
associated with the Spacecraft in accordance with the provisions of
ARTICLE 6, as though the IOT review had been completed on the date that
the Spacecraft was placed into storage. Notwithstanding the foregoing,
in the event that Contractor's late Delivery of the Spacecraft is the
sole cause of the Spacecraft having to be placed into storage, the
In-Orbit Incentives shall commence as set forth in ARTICLE 6.
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ARTICLE 32. SURVIVAL
The following ARTICLES shall survive the completion, expiration or
termination of this Contract: ARTICLE 11. RIGHTS IN DATA; ARTICLE 12. PUBLIC
RELEASE OF INFORMATION; ARTICLE 13. INDEMNIFICATION; ARTICLE 14. PATENT
INDEMNITY; ARTICLE 15. INDEMNIFICATION FOR TAXES; ARTICLE 21. WARRANTY; ARTICLE
22. ARBITRATION; ARTICLE 23. APPLICABLE LAW; ARTICLE 25. DISCLOSURE AND USE OF
INFORMATION BY THE PARTIES; ARTICLE 27. PERMITS AND LICENSES; ARTICLE 28.
LIMITATION OF LIABILITY; ARTICLE 34. INTERPARTY WAIVER OF LIABILITY.
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ARTICLE 33. INSURANCE
A. If the Buyer applies for insurance regarding risks relating to the
Launch of the Spacecraft, the Contractor shall furnish Buyer with such
information regarding the Spacecraft as is requested by the insurers
and will cooperate in any insurance reviews.
B. If Buyer obtains such insurance, Buyer agrees to cause its insurer(s)
to waive all rights of subrogation against Contractor and its officer,
agents, servants, subsidiaries and employees, subject to terms and
conditions as are then customarily available regarding such waivers.
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ARTICLE 34. INTERPARTY WAIVER OF LIABILITY
The Parties hereby agree to be bound by the no-fault, no-subrogation
inter-party waiver of liability and related indemnity provisions provided in the
launch services agreement that Buyer enters into with the Launch provider who
actually launches the Satellite, with respect to the Launch and to cause their
respective contractors and subcontractors at any tier (including suppliers of
any kind) that are involved in the performance of this Contract and any other
person having an interest in the Satellite or any transponder thereon (including
customers of Buyer), as required by the launch services agreement and as
specified by Buyer, to accede to such waiver. The Parties shall execute and
deliver any instrument that may be required by the Launch provider to evidence
their agreement to be bound by such waiver. Buyer and Contractor also shall
obtain, from their insurers, and shall cause their respective contractors and
subcontractors at any tier (including suppliers of any kind) that are involved
in the performance of this Contract and any other person having an interest in
any Satellite or any transponder thereon (including customers of Buyer), as
required by the launch services agreement and as specified by Buyer, to obtain
from their insurers, an express waiver of such insurers' rights of subrogation,
subject to terms and conditions as are then customarily available regarding such
waivers, with respect to any and all claims that have been waived pursuant to
this ARTICLE 34.
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ARTICLE 35. COOPERATION REGARDING SPOT BEAMS
Until thirty (30) days after EDC, Contractor shall use reasonable
commercial efforts to cooperate with Space Systems/Loral, Inc. ("SS/L")
regarding the footprints of the spot beams for the Spacecraft and the EchoStar 8
satellite being manufactured by SS/L. In addition, upon Buyer's request,
Contractor shall use reasonable commercial efforts to cooperate with SS/L as
necessary to change the initial footprints of the spot beams for the Spacecraft
and the EchoStar 8 satellite. Finally, Contractor shall use reasonable
commercial efforts to cooperate with SS/L as necessary to ensure that the spot
beams of the Spacecraft and the EchoStar 8 satellite, as deployed, will operate
in accordance with the final approved beam footprints.
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ARTICLE 36. DRY MASS PENALTY
If, at the time of final acceptance pursuant to ARTICLE 7, the mass of
the Spacecraft without propellant or pressurant (the "Dry Mass") exceeds 1868
Kilograms (Kg), Contractor shall pay to Buyer an amount calculated as XXXXXXX
Dollars ($XXXXXXX) per each Kg by which such Dry Mass exceeds 1868 Kg (the "Dry
Mass Penalty") and, if Buyer elects to launch the Satellite using a launch
vehicle other than an Atlas IIIB launch vehicle, then, in addition to paying the
Dry Mass Penalty, Contractor will perform all necessary integration activities
in connection with the new launch vehicle on an expedited basis, at no
additional cost or expense to Buyer (the "Integration Penalty").
Notwithstanding the prior paragraph, if the Dry Mass exceeds 1868 Kg,
but the orbital life of the Spacecraft is still expected to be at least 14
years, with industry standard margins, after completion of the IOT review,
assuming an Atlas IIIB launch vehicle having a nominal supersynchronous MRS
mission, then Contractor shall not be required to pay a Dry Mass Penalty or be
subject to the Integration Penalty.
Contractor hereby represents and warrants to Buyer that, to the best of
its knowledge and belief on the date hereof, after the exercise of reasonable
diligence, if the Satellite has a Dry Mass of 1868 or less Kilograms (Kg), at
the time of final acceptance pursuant to ARTICLE 7, and is launched using an
Atlas IIIB launch vehicle, with a nominal supersynchronous MRS mission, the
Satellite will have an orbital life of at least 14 years after completion of the
IOT review, with industry standard margins.
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ARTICLE 37. KEY PERSONNEL
The Contractor will assign properly qualified and experienced personnel
to the program contemplated under the Contract. Personnel assigned to the
following positions shall be considered "Key Personnel":
a) the Contractor's Program Manager
b) the Contractor's Contracts Manager
c) the Contractor's PA Manager
d) the Contractor's Vehicle Systems Engineering Manager
e) the Contractor's Vehicle Manager
The Buyer shall have the right to approve the Contractor's Program
Manager which approval shall not be unreasonably withheld or delayed. Key
Personnel shall not be assigned to other duties without the Contractor giving
prior written notice to and consulting with the Buyer. The Contractor shall
provide a chart to the Buyer of the program Key Personnel and shall keep such
chart current.
Additionally:
1) Xxxx Xxxx shall continue to be the primary interface with the
Buyer in the capacity of the EchoStar Account Executive and
Technical Expert and have a key decision making role within
the EchoStar VII program when an issue remains unresolved.
2) Xxxxxx Xxxxxxx shall be assigned to the program on a full time
basis, directing the design and implementation of the payload,
have the key decision-making role on payload-related issues,
and shall be the primary interface with the Buyer on all
payload-related technical and performance issues. Xx. Xxxxxxx
must be consulted, and sign off, on the following
payload-related deliverables: (a) all portions of PDRs and
CDRs relating to payload; (b) payload end item data package;
(c) payload performance data; and (d) payload IOT reports.
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IN WITNESS WHEREOF, the parties hereto have executed this Contract.
ECHOSTAR ORBITAL CORPORATION LOCKHEED XXXXXX CORPORATION
By: By:
------------------------------- ----------------------------
Xxxxx X. Xxxxxxxxx Xxxxx X. Xxxxxxx
Senior Vice President and Director of Contracts
General Counsel
EchoStar Communications Corporation hereby guarantees all of the obligations and
duties of EchoStar Orbital Corporation under the Contract to which this
guarantee is attached.
ECHOSTAR COMMUNICATIONS
CORPORATION
By:
-------------------------------
Xxxxx X. Xxxxxxxxx
Senior Vice President and
General Counsel
