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EXHIBIT 10.12
AMENDMENT NO. 1 TO
AMENDED AND RESTATED
ORBIMAGE SYSTEM PROCUREMENT AGREEMENT
Amendment No. 1 (this "Amendment") is made and entered into as of the
31st day of December 1998 between Orbital Sciences Corporation, a Delaware
Corporation ("Orbital"), and Orbital Imaging Corporation, a Delaware
Corporation ("OIC" or "ORBIMAGE").
WITNESSETH
WHEREAS, the parties have previously entered into the Amended and
Restated ORBIMAGE System Procurement Agreement dated February 26, 1998; and
WHEREAS, the parties desire to amend the Amended and Restated ORBIMAGE
System Procurement Agreement as set forth below.
NOW, THEREFORE, the parties agree as follows:
SECTION 1. Amendments to Article 2.
(a) In Sections 2.3.1 and 2.5.1, delete references to (Exhibit C, Part
1A) and (Exhibit C, Part 1B) and replace each with "(Exhibit C)".
(b) Section 2.4 is amended to read in its entirety as follows:
"Section 2.4. Provision of OrbView Command and Control Segment and
OrbView Data Processing Segment. Orbital shall design, construct, deliver and
test the OrbView-3 and OrbView-4 Command and Control Segment ("CCS"), defined
hereunder to encompass the CCS, Tasking and Distribution Segment ("TADS") and
Ground Terminals ("GTS or Earth Terminals"), the OrbView-3 and OrbView-4 Data
Processing Segment ("DPS"), and spare equipment in accordance with the OrbView
High Resolution Imagery System Mission Requirements Document (Exhibit C),
Statement of Work (Exhibit C) and the Joint OrbView-3 and OrbView-4 Command and
Control and Data Processing and Distribution Requirements Specification
(Exhibit D, Part 1). Orbital shall design, construct and deliver the OrbView-1
and OrbView-2 Command and Control Segment in accordance with the OrbView-1 and
OrbView-2 Command and Control Statement of Work (Exhibit D, Part 2)."
(c) A new Section 2.4.1 is added as follows:
"Section 2.4.1. Provision of the OrbView High Resolution
System Ground Segment Upgrades for NIMA. Orbital shall develop,
deliver and test OrbView Ground Segment infrastructure upgrades to
support NIMA requirements in accordance with the Statement of Work for
Orbital Support to NIMA's Commercial Imagery Initiative (Exhibit C).
(d) Section 2.5.2 is amended to read in its entirety as follows:
"Section 2.5.2. Provision of Launch. Orbital shall launch the
OrbView-4 Satellite as the primary payload using a Taurus Launch
Vehicle in accordance with the applicable Launch Vehicle Statement of
Work and Specifications. Orbital shall have the right to procure one
or more secondary payloads for the OrbView-4 Taurus Launch Vehicle,
subject to OIC's written consent, which shall not be unreasonably
withheld. "
SECTION 2. Amendments to Article 3.
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(a) Section 3.1 is amended to read in its entirety as follows:
"Section 3.1. The price for the work hereunder (collectively, the
"Price") is as follows:
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CLIN FIXED PRICE
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001 OrbView-1 System (2.1) $12,327,000
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002 OrbView-2 License (2.2) 62,743,000
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003 OrbView-3 Satellite and Launch (2.3.1, 2.3.2) 69,200,000
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004 Data Processing Segment and Command and Control Segment (2.4) 29,850,000
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005 OrbView-4 Satellite (2.5.1) 73,500,000
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008 OrbView-4 Launch (2.5.2) 21,750,000
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007 Ground Segment Upgrades for NIMA (2.4.1) 480,000
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TOTAL FIXED PRICE $269,850,000
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006 Insurance COST-REIMBURSABLE
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009 On-Orbit Performance Incentive $10,000,000
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010 OrbView-4 HSI Modifications $31,000,000
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SECTION 3. Amendments to Article 5.
(a) Section 5.3 is amended to read in its entirety as follows:
"Section 5.3. Monthly Payment Schedule Invoices. Within 15 days
after the end of each month, Orbital shall submit certified invoices reflecting
actual incurred costs for the preceding month and any unpaid balance from prior
months. OIC shall pay such invoices to the extent provided in Section 5.1
within 10 days from the date of receipt."
(b) Section 5.4 is amended to read in its entirety as follows:
"Section 5.4. Milestone Schedule Payments. Exhibit F also sets forth
a Milestone Payment Schedule for CLIN 003 through CLIN 005. Orbital shall
invoice OIC for the CLIN 003 through CLIN 005 and CLIN 008 Milestones set forth
in Exhibit F upon achieving, and OIC acceptance, of such milestones. Such
invoices shall be paid within 10 days of receipt. In addition, milestone
payments for CLIN 007 shall be made in accordance with Exhibit F. Orbital
shall submit separate invoices to OIC upon achieving, and OIC acceptance, of
such CLIN 007 milestones with no more than 1 milestone event invoiced in a
single month. CLIN 007 invoices shall be payable within 45 days of receipt.
All CLIN 007 payments shall be unliquidated payments until acceptance of the
final milestone by OIC.
(c) A new Section 5.6 is added as follows:
"Section 5.6. On-Orbit System Performance Incentive. For the
OrbView-3 satellite, OrbView-4 satellite and OrbView-3/4 ground system
elements, OIC agrees to pay Orbital an on-orbit system performance incentive
not to exceed a fixed price of $1,000,000 per operational year for each
satellite. The on-orbit performance incentive shall be paid during each
satellite's 5 year operational life. This equates to a maximum payment of
$10,000,000. The Milestone Payment Schedule for the CLIN 009 on-orbit
performance incentive is provided in Exhibit F. The first payment shall be
made 12 months following completion, and OIC acceptance, of on-orbit system
verification of the respective OrbView satellite and ground segment elements.
The actual on-orbit performance incentive payable for each satellite for each
12 month period shall be $1,000,000 multiplied by the value of the Global
Efficiency Metric ("GEM"), which can range from one to zero. The GEM formula
is represented as the product of the performance parameters defined in the
Statement of Work (Exhibit C). The GEM parameters shall be measured initially
by Orbital as part of the OrbView-3 and OrbView-4 on-orbit system checkout to
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establish performance compliance using a benchmark test. OIC will repeat this
benchmark test, on an annual basis, to obtain the GEM value and actual
incentive payable to Orbital. Orbital may participate in such testing at its
own expense. Payment shall be made by OIC within 15 days of completion of the
GEM evaluation report."
SECTION 4. Amendments to Article 6.
(a) Sections 6.1 (c), (d), (e), and (f) are amended to read in their
entirety as follows:
"(c). Orbital shall complete on-orbit verification of the OrbView-3
Satellite and related ground segment to support commercial operations no later
than 60 days following launch of the OrbView-3 Satellite subject to Section 7.4
below. Final acceptance of the OrbView-3 Satellite and the phased ground
system elements shall be deemed to have occurred upon completion and OIC
acceptance of on-orbit checkout, calibration, and verification of the
satellite/ground system conducted in accordance with the Exhibit C Statement of
Work and Mission Requirements Document.
(d). Delivery of the OrbView-3/4 Data Processing Segment ("DPS")
shall be phased as follows: (1) delivery for OrbView-3 shall include full DPS
functionality with approximately 50% throughput for basic and geo-corrected
data products. Delivery and verification shall occur no later than 60 days
following OrbView-3 launch; and (2) remaining DPS capability shall be delivered
and verified no later than 60 days prior to OrbView-4 launch. Orbital shall
perform installation, segment acceptance testing, and system verification for
each phased delivery in accordance with Exhibit C Statement of Work and Mission
Requirements Document.
(e). Delivery of the Command and Control Segment for OrbView-1 and
OrbView-2 shall be as defined in subparagraphs (1) and (2). Phased delivery of
the OrbView-3 and OrbView-4 Command and Control Segment shall be as described
in subparagraphs (3), (4) and (5). Orbital shall perform installation, segment
acceptance testing and system verification for each phased delivery in
accordance with the Exhibit C Statement of Work and Mission Requirements
Document.
(1) Completed work for the OrbView-1 and OrbView-2 Systems shall
be delivered at the time of closing the private financing contemplated by OIC.
(2) Remaining work for OrbView-2 shall be delivered in April,
1997.
(3) OrbView Command and Control Segment ("CCS") for OrbView-3 and
OrbView-4 shall be delivered no later than 60 days prior to each satellite's
respective launch date.
(4) Full functionality and redundancy for the Northern Ground
Terminal and full functionality for the CONUS Ground Terminal shall be
delivered and verified no later than 45 days prior to the OrbView-3 launch
date.
(5) Full functionality for the Tasking and Distribution Segment
("TADS") shall be delivered and verified no later than 60 days following
OrbView-3 launch.
(f). Orbital shall complete on-orbit verification of the OrbView-4
Satellite and related ground segment to support commercial operations no later
than 60 days following launch of the OrbView-4 Satellite subject to Section 7.4
below. Final acceptance of the OrbView-4 Satellite and remaining OrbView-3/4
ground system elements shall be deemed to have occurred upon completion and OIC
acceptance of on-orbit checkout, calibration, and verification of the
satellite/ground system conducted in accordance with the Exhibit C Statement of
Work and Mission Requirements Document."
SECTION 5. Amendments to Article 7.
(a) Section 7.3 (b) and (c) are amended to add the following as the
last sentence to each paragraph:
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"Orbital shall perform, at its expense, acceptance and system verification
tests over a thirty (30) day period following each phased delivery as well
as a final integrated system verification test over a thirty (30) day
period after test of the last phased delivery in accordance with Exhibit C
Statement of Work and Mission Requirements Document."
(a) Section 7.4 is amended to read in its entirety as follows:
"Section 7.4. On-Orbit System Checkout. For a period of thirty (30)
days after launch of each satellite, Orbital shall perform, at its expense,
on-orbit system checkout, calibration, and verification of the OrbView-3 and
OrbView-4 satellites and OrbView-3/4 ground segment to demonstrate compliance,
as determined by ORBIMAGE acting reasonably, with Exhibit C OrbView High
Resolution Imagery System Mission Requirements Document and in accordance with
the Exhibit C Statement of Work."
SECTION 6. Amendments to Article 8.
(a) Paragraph (e) is amended to read in its entirety as follows:
"(e) with respect to the CCS (to include TADS and GTS) and DPS for
OrbView-3 and OrbView-4, upon successful completion, and OIC acceptance, of the
final ATPs and on-orbit system verifications subsequent to all phased
deliveries as defined in Section 6.1 and the Exhibit C Statement of Work and
Mission Requirements Document; and"
SECTION 7. Amendments to Article 10.
(a) Section 10.2.(a) subparagraphs (i.) through (iv.) are deleted in
their entirety and the following new paragraph (i.) is hereby
incorporated:
"(i.) for all segments of the OrbView-3 and OrbView-4 Command and
Control Segment (including the TADS and GTS) and Data Processing
Segment for a period of one (1) year after the later to occur of (A)
final acceptance of the last phased delivery of the OrbView ground
segment or (B) completion of OrbView-4 on-orbit system verification
activities."
SECTION 8. Amendments to Article 11.
(a) Article 11 is amended to read in its entirety as follows:
(a) HSI Contract. Pursuant to that certain contract between Orbital and
the U.S. Air Force/Philips Laboratory ("USAF") awarded August 5, 1997,
(Contract No. F29601-97-C-0110) (the "HSI Contract"), Orbital has, among other
things, undertaken to design a hyperspectral imaging ("HSI") sensor to be
integrated onto the OrbView-4 camera, to supply a mission data center and
mobile ground station, and to provide related work and services including
certain post-launch support, all as are further detailed in the HSI Contract.
Notwithstanding anything in this Agreement to the contrary, the terms and
conditions of this Article 11 are subject to all rights of the USAF pursuant to
the HSI Contract.
(b) OIC Procurement of HSI Modifications. OIC hereby agrees to procure
from Orbital HSI Sensor modifications to the OrbView-4 Satellite to add
hyperspectral capability and other work and services. OIC agrees to pay
Orbital $31,000,000 for the HSI Sensor modifications and other work and
services on the OrbView-4 Satellite in accordance with CLIN 010 of this
Agreement. This amount shall be adjusted to reflect the final combined value
of HSI Contract CLINs 0001 through 0003. OIC shall forward such payment upon
the launch of OrbView-4 in accordance with the Milestone Payment Schedule set
forth in Exhibit F.
(c) OIC On-Orbit Support. Orbital shall subcontract with OIC to provide
on-orbit support to the USAF contemplated by the HSI Contract. Orbital shall
pay OIC for such on-orbit support in accordance
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with such subcontract. If OIC declines to perform such work, then Orbital
shall perform such work at no cost to OIC, provided, however, that OIC shall
grant Orbital reasonable access to the OrbView-4 Satellite and ground segment
to enable Orbital to perform such work.
(d) Hardware. Orbital agrees to deliver to OIC all hardware that is
produced or procured under the HSI Contract that is not otherwise deliverable
to USAF. Orbital shall also deliver one set of technical drawings, reports and
other documentation ("HSI Documentation") relating to such hardware. OIC shall
only be entitled to use such hardware and HSI Documentation for the purpose of
operating and maintaining the OrbView-4 Satellite system and any follow-on
systems that have similar hyperspectral capability.
(e) Software. To the extent permitted under the HSI Contract, the Federal
Acquisition Regulations and all applicable subcontracts, Orbital hereby grants
to OIC a perpetual, royalty free, non-exclusive, non-transferable license to
use the software, algorithms, and all other intellectual property (including
but not limited to any code) to be developed or purchased by Orbital under the
HSI Contract ("HSI Software"). To the extent Orbital has possession of source
code, object code, and any other code and documentation relating to the HSI
Software ("HSI Code") and is not otherwise prohibited from doing so, Orbital
shall deliver to OIC one copy of the HSI Code in a form sufficient to enable
OIC to operate and maintain the OrbView-4 Satellite and any follow-on systems
that have similar hyperspectral capability. OIC shall only be entitled to use
the HSI Software and HSI Code for the purpose of operating and maintaining the
OrbView-4 Satellite and any follow-on systems that have similar hyperspectral
capability. Orbital shall use commercially reasonable efforts to cause its
subcontracts to permit sublicensing of HSI Software and HSI Code to OIC
consistent with the terms of this Section 11(d).
(f) No Third Party Beneficiary Rights. Nothing herein shall be construed
to confer any third-party beneficiary rights in the USAF under this Procurement
Agreement. Orbital agrees to indemnify OIC for any damages arising from any
claims by the USAF against OIC relating to the HSI Contract.
(g) Rights on HSI Contract Termination. In the event the HSI Contract is
terminated by any party thereto for any reason, OIC shall likewise have the
right to terminate the HSI Modifications as set forth in Section 11 (b). In
addition, OIC shall have the same rights with respect to the HSI Work as set
forth in Section 12.2 of this Agreement.
(h) Modifications to HSI Contract. Orbital shall consult with OIC
regarding changes to the HSI Contract and shall not agree to any material
modifications without OIC's prior written consent, which shall not be
unreasonably withheld.
SECTION 9. Amendments to List of Exhibits and Schedules.
Exhibit C is amended to read in its entirety as follows:
"Exhibit C (a) OrbView High Resolution Imagery System
Mission Requirements Document, 5L5-RS1000
Revision D, dated December 22, 1998;
(b) Statement of Work for the OrbView High
Resolution Imaging System, Revision A,
dated December 22, 1998;
(c) Statement of Work for Orbital Support to
NIMA's Commercial Imagery Initiative,
dated December 15, 1998."
SECTION 10. Amendment to Appendix A. The following defined terms are hereby
incorporated under Appendix A.
"HSI Contract" shall mean the U.S Air Force /Xxxxxxxx Laboratory contract
(Contract No. F29601-97-C-0110), between Orbital and the USAF duly executed on
August 5, 1997.
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"HSI Data Agreement" shall mean this Hyperspectral Imaging Data Agreement
between Orbital and ORBIMAGE dated December 31, 1998.
SECTION 11. Amendment to Exhibit F. A revised Exhibit F is attached hereto.
SECTION 12. No Further Changes. Except as modified by this Amendment, the
Amended and Restated ORBIMAGE System Procurement Agreement dated February 26,
1998 remains unmodified and in full force and effect.
IN WITNESS WHEREOF, the parties have caused this Amendment No. 1 to
the Amended and Restated ORBIMAGE System Procurement Agreement to be executed
as of the date first written above.
ORBITAL SCIENCES CORPORATION ORBITAL IMAGING CORPORATION
By: By:
--------------------------- ---------------------------
Xxxxxxx X. Xxxxxx Xxxxxxx X. Xxx
Executive Vice President and CFO President and COO
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AMENDMENT NO. 1 - EXHIBIT F
PAYMENT SCHEDULE ($ IN THOUSANDS)
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December 31, 1997 $130,700
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MILESTONE PAYMENTS MONTHLY PAYMENTS
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1998
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January 7,000
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February OrbView-4 CDR 1,500 7,300
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March 10,700
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April 11,700
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May 11,850
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June OrbView-3 PDR 1,500 9,250
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July 9,550
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August 8,450
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September OrbView-3 CDR 1,500 6,600
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October 6,100
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November 4,500
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December 4,400
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1999
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January CLIN 007-M/S 1- SRR update 62 3,838
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February Start OrbView-3 I&T 1,500 4,430
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March CLIN 004-Execution of MDA SubK Rebaseline 1,000 1,838
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April CLIN 007-M/S 2- Concept for Task 2.1& 2,2 62 2,438
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May CLIN 007-M/S 3- Design for Task 2.3 62 2,700
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June CLIN 007-M/S 4- Design for Tasks 2.1 & 2.2 62 1,632
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July CLIN 007-M/S 5-Test Plan Submit/Start Test 62 400
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August CLIN 007-M/S 6- Delivery/Demo of Upgrades 170 832
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September OV-3 Launch; GTS Spares Delivered 106 600
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October Start OrbView-4 I&T 1,500 700
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November OrbView-3 On-Orbit Verification Complete 1,500 700
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December Taurus motors delivered- OrbView-4 3,500 700
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2000
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January 700
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February 400
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March OrbView-4 Launch 3,750 200
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March CLIN 010 OrbView-4 HSI Sensor Modifications ** 31,000 200
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April GTS spares delivered 106
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May OrbView-4 On-Orbit Verification Complete 1,500
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June
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July OrbView-3 On-Orbit Performance* 1,000
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2001
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May OrbView-4 On-Orbit Performance* 1,000
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July OrbView-3 On-Orbit Performance* 1,000
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2002
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May OrbView-4 On-Orbit Performance* 1,000
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July OrbView-3 On-Orbit Performance* 1,000
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2003
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May OrbView-4 On-Orbit Performance* 1,000
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July OrbView-3 On-Orbit Performance* 1,000
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2004
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May OrbView-4 On-Orbit Performance* 1,000
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July OrbView-3 On-Orbit Performance* 1,000
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2005
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July OrbView-4 On-Orbit Performance* 1,000
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60,442 250,408
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* Actual payment based on measured performance
** Subject to the terms set forth in Article 11 (b).
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TOTAL PAYMENT 310,850
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