1
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.
LAUNCH SERVICE CONTRACT
BETWEEN
LOCKHEED MARTIN COMMERCIAL LAUNCH SERVICES, INC.
AND
ECHOSTAR ORBITAL CORPORATION
CONFIDENTIAL TREATMENT
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CONTRACT FOR LAUNCH SERVICES
This Contract is made and entered into as of January 31, 2001 by and between
Lockheed Martin Commercial Launch Services, Inc., a Delaware corporation, having
its principal place of business at 1660 International Drive, Suite 800, McLean,
Virginia 22102 ("Contractor") and EchoStar Orbital Corporation, a Colorado
corporation, having its principal place of business at 5701 South Santa Fe
Drive, Littleton, Colorado 80120 ("Customer").
ARTICLE 1
DEFINITIONS
Capitalized terms used and not otherwise defined herein shall have the following
meanings:
CSLA means the Commercial Space Launch Act, 49 U.S.C. Sections 70101 -
70119, as amended.
Constructive Total Failure [CONFIDENTIAL MATERIAL REDACTED]
Contract means this instrument and all exhibits attached hereto, as the
same may be amended from time to time in accordance with the terms hereof,
including:
Exhibit A - Atlas Launch Services Statement of Work for the
EchoStar Program, which presently covers Atlas Launch
Services for EchoStar VII and EchoStar VIII, [CONFIDENTIAL
MATERIAL REDACTED]
Exhibit B - EchoStar VII Interface Control Document
Exhibit C - Proton Launch Services Statement of Work for the
EchoStar Program, which presently covers Proton Launch
Services for EchoStar VII and EchoStar VIII, [CONFIDENTIAL
MATERIAL REDACTED]
Exhibit D - EchoStar VIII Interface Control Document
Contract Price means, with respect to a particular Launch Service, the
Contract Price as set forth in Article 4 entitled "Contract Price" for the
relevant Launch Service.
Excusable Delay shall have the meaning set forth in Section 8.1
entitled "Excusable Delays Defined."
Failure Review Board shall have the meaning and the duties set forth in
Section 19.5 entitled "Failure Review Board."
Insured Launch Activities [CONFIDENTIAL MATERIAL REDACTED]
Intentional Ignition means (a) for Atlas, the point in time during the
launch countdown when the engine start command is issued, causing the start
bottle to be
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pressurized and hypergolics to enter the chamber, and (b) for Proton, the
ignition of the first-stage motor(s) of the Launch Vehicle.
L means the first day of the Launch Period, Launch Slot, or Launch
Date, whichever is in then effect.
Launch [CONFIDENTIAL MATERIAL REDACTED]
Launch Date means the calendar date within the Launch Slot during which
the Launch is scheduled to occur, as established in accordance with Article 6
entitled "Launch Schedule" and as such Launch Date may be adjusted in accordance
with Article 7 entitled "Launch Schedule Adjustments."
Launch Opportunity [CONFIDENTIAL MATERIAL REDACTED]
Launch Period [CONFIDENTIAL MATERIAL REDACTED]
Launch Service means those services to be provided by Contractor to
Customer for a single Launch as set forth in the applicable Statement of Work.
Launch Site means (a) for Atlas, Cape Canaveral Air Station located in
Florida and (b) for Proton, the Baikonur Cosmodrome located in Kazakhstan, or
such other place as mutually agreed by the Parties.
Launch Slot [CONFIDENTIAL MATERIAL REDACTED]
Launch Vehicle [CONFIDENTIAL MATERIAL REDACTED]
Optional Launch Service means a Launch Service which may be ordered by
the Customer pursuant to Article 3.
Partial Failure [CONFIDENTIAL MATERIAL REDACTED]
Party or Parties means Contractor, Customer or both.
Reflight Launch means the additional Launch Service(s) that may be
provided to Customer in accordance with Article 19 entitled "Reflight Launch or
Refund Protection."
Reflight Launch Fee means the fee for Reflight Launch protection set
forth in Article 19 entitled "Reflight Launch or Refund Protection."
Refund means the amount that may be payable to Customer pursuant to
Section 19.3 entitled "Terms Governing Refund" in the event the Launch Service
is a Total Failure, Constructive Total Failure or Partial Failure.
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CONFIDENTIAL TREATMENT
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Refund Fee means the fee for Refund protection set forth in Article 19
entitled "Reflight Launch or Refund Protection."
Related Third Parties [CONFIDENTIAL MATERIAL REDACTED]
Satellite means the applicable Customer-provided satellite among EchoStar VII,
EchoStar VIII and additional satellites, if any, covered by Optional Launch
Services (with specific satellites to be identified later) and associated
property to be launched on the Launch Vehicle, with technical specifications and
characteristics set forth in the applicable Statement of Work.
Satellite Separation means the physical separation of the Satellite
from the Launch Vehicle pursuant to the command activating the separation system
that releases the Satellite.
Statement of Work means that document attached as Exhibit A to this
Contract for Atlas and as Exhibit C to this Contract for Proton, as applicable.
Terminated Ignition [CONFIDENTIAL MATERIAL REDACTED]
Termination Charge means the charge calculated in accordance with
Section 21.7 entitled "Termination Charge."
Third Party [CONFIDENTIAL MATERIAL REDACTED]
Total Failure [CONFIDENTIAL MATERIAL REDACTED]
Trade Agreement [CONFIDENTIAL MATERIAL REDACTED]
ARTICLE 2
SERVICES TO BE PROVIDED
2.1 Base-Lined Launch Services. Contractor shall furnish a Launch Service for
one Launch of the EchoStar VII Satellite from Cape Canaveral Air Station
("CCAS"), Florida, United States of America, in accordance with Exhibit A
entitled "Atlas Launch Services Statement of Work for the EchoStar Program," and
a Launch Service for one Launch of the EchoStar VIII Satellite from Baikonur
Cosmodrome ("Baikonur") in Baikonur, Kazahkstan, in accordance with Exhibit C
entitled "Proton Launch Services Statement of Work for the EchoStar Program,"
each scheduled for the Launch Periods as specified in Section 6.1 entitled
"Launch Period."
2.2 Optional Launch Services. Contractor shall furnish up to [CONFIDENTIAL
MATERIAL REDACTED] Launches of Satellites from CCAS and/or Baikonur in
accordance with Exhibit A entitled "Atlas Launch Services Statement of Work for
the EchoStar Program" and/or Exhibit C entitled "Proton Launch Services
Statement of Work for the EchoStar Program," as applicable, should one or more
Optional Launch
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Services be exercised by Customer in accordance with Article 3 entitled
"Optional Launch Services."
2.3 [CONFIDENTIAL MATERIAL REDACTED]
ARTICLE 2A
[CONFIDENTIAL MATERIAL REDACTED]
ARTICLE 2B
[CONFIDENTIAL MATERIAL REDACTED]
ARTICLE 2C
[CONFIDENTIAL MATERIAL REDACTED]
ARTICLE 3
OPTIONAL LAUNCH SERVICES
3.1 Period of Performance of Optional Launch Services. In no event shall
Customer have the right to order Optional Launch Services under this Contract
that have initial Launch Period end dates that are later than [CONFIDENTIAL
MATERIAL REDACTED]. Once an Optional Launch Service is ordered by Customer, it
shall be considered a Launch Service under this Contract.
3.2 Exercising of Optional Launch Services. No later than [CONFIDENTIAL MATERIAL
REDACTED], Customer will provide Contractor a written notice containing the
requested Launch Vehicle performance capabilities, Customer's Launch Vehicle
preferences for the mission, Satellite configuration, three-month Launch Period
and option exercise date for such Launch Service. Contractor shall [CONFIDENTIAL
MATERIAL REDACTED]. After receipt of the Contractor's letter, Customer may,
consistent with Section 3.3 and subject to Section 3.6, exercise the Optional
Launch Service by providing a written notice to the Contractor containing the
pertinent Satellite information, the desired three-month Launch Period, the
desired Atlas or Proton configuration, as applicable, the name and general
description of the mission, and [CONFIDENTIAL MATERIAL REDACTED], all no later
than [CONFIDENTIAL MATERIAL REDACTED] prior to the first day of the desired
Launch Period [CONFIDENTIAL MATERIAL REDACTED]
[CONFIDENTIAL MATERIAL REDACTED]
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CONFIDENTIAL TREATMENT
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ARTICLE 4
CONTRACT PRICE
4.1 Baseline Contract Prices. The Contract Price for each baseline Launch
Service for payment purposes shall be:
Atlas IIIB(D): [CONFIDENTIAL MATERIAL REDACTED]
Proton K/Block DM: [CONFIDENTIAL MATERIAL REDACTED]
4.2 Optional Launch Service Prices. The Contract Price for each Optional
Launch Service shall be:
Atlas IIIB(d): [CONFIDENTIAL MATERIAL REDACTED]
Atlas V(401): [CONFIDENTIAL MATERIAL REDACTED]
Atlas V(402): [CONFIDENTIAL MATERIAL REDACTED]
Proton K/Block DM: [CONFIDENTIAL MATERIAL REDACTED]
Proton M/Breeze M: [CONFIDENTIAL MATERIAL REDACTED]
4.3 Taxes for Atlas Launch Services.
[CONFIDENTIAL MATERIAL REDACTED]
4.4 Duties and Taxes for Proton
[CONFIDENTIAL MATERIAL REDACTED]
ARTICLE 5
PAYMENT
5.1 Timing of Payments. Payment of the Contract Price and all other amounts set
forth herein shall be in United States Dollars, subject to conditions set forth
in Article 7 and made in accordance with the following schedule:
5.1.1 Initial Payments. Customer will make an initial payment of
[CONFIDENTIAL MATERIAL REDACTED] of the Contract Price for each Launch Service
as set forth in Article 4. This initial payment is due at Contract signing for
the two baseline Launch Services and with the Optional Launch Service exercise
notification letter for each Optional Launch Service exercised by Customer.
5.1.2 Remaining Payments. The balance of the payments for each Launch
Service specified in Article 2 entitled "Services To Be Provided" shall be paid
in accordance with the schedule set forth in Table 5.1, 5.2, or 5.3, as
applicable, where "L" is the [CONFIDENTIAL MATERIAL REDACTED]. If a payment due
date falls on a Saturday, Sunday or legal bank holiday, then payment shall be
due on the following
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business day. Except as otherwise set forth to the contrary in Article 19, no
portion of the Contract Price shall be refundable in the event the Launch
Service fails to perform in accordance with the Statement of Work. Any portion
of the Contract Price set forth in Table 5.1, 5.2, or 5.3, below, due after
Launch shall be payable on the date due whether or not the Launch Service
performs in accordance with the Statement of Work.
5.1.3 Shortened Delivery Schedule. In the event that the Parties
mutually agree to a shorter delivery schedule than [CONFIDENTIAL MATERIAL
REDACTED] for a particular Optional Launch Service, then the initial payment due
from Customer shall be equal to the sum of all payments that would otherwise be
due and payable under Table 5.3 below at the time Customer exercises that
particular Optional Launch Service.
Table 5.1 Launch Payment Schedule for baseline Atlas Launch
Service
Percent of Payment Due
Payment Number Contract Price Date
-------------- -------------- -----------
2 [CONFIDENTIAL MATERIAL REDACTED]
3 [CONFIDENTIAL MATERIAL REDACTED]
4 [CONFIDENTIAL MATERIAL REDACTED]
5 [CONFIDENTIAL MATERIAL REDACTED]
6 [CONFIDENTIAL MATERIAL REDACTED]
7 [CONFIDENTIAL MATERIAL REDACTED]
8 [CONFIDENTIAL MATERIAL REDACTED]
9 [CONFIDENTIAL MATERIAL REDACTED]
10 [CONFIDENTIAL MATERIAL REDACTED]
Table 5.2 Launch Payment Schedule for baseline Proton Launch
Service
Percent of Payment Due
Payment Number Contract Price Date
-------------- -------------- -----------
2 [CONFIDENTIAL MATERIAL REDACTED] Contract Signing
3 [CONFIDENTIAL MATERIAL REDACTED]
4 [CONFIDENTIAL MATERIAL REDACTED]
5 [CONFIDENTIAL MATERIAL REDACTED]
6 [CONFIDENTIAL MATERIAL REDACTED]
7 [CONFIDENTIAL MATERIAL REDACTED]
8 [CONFIDENTIAL MATERIAL REDACTED]
9 [CONFIDENTIAL MATERIAL REDACTED]
10 [CONFIDENTIAL MATERIAL REDACTED]
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Table 5.3 Launch Payment Schedule for Optional Launch Services
Percent of Payment Due
Payment Number Contract Price Date
-------------- -------------- -----------
2 [CONFIDENTIAL MATERIAL REDACTED]
3 [CONFIDENTIAL MATERIAL REDACTED]
4 [CONFIDENTIAL MATERIAL REDACTED]
5 [CONFIDENTIAL MATERIAL REDACTED]
6 [CONFIDENTIAL MATERIAL REDACTED]
7 [CONFIDENTIAL MATERIAL REDACTED]
8 [CONFIDENTIAL MATERIAL REDACTED]
[CONFIDENTIAL MATERIAL REDACTED]
Payment Due
Payment Number Price Date
-------------- -------------- -----------
1 [CONFIDENTIAL MATERIAL REDACTED]
[CONFIDENTIAL MATERIAL REDACTED]
Payment Due
Payment Number Price Date
-------------- -------------- -----------
1 [CONFIDENTIAL MATERIAL REDACTED]
5.2 Payment Instructions. All payments to Contractor will be by check
hand-delivered to Jack Zivic (or other individual authorized by Contractor in
writing to receive such payments) at Customer's office at 5701 S. Santa Fe
Drive, Littleton, Colorado 80120.
5.3 Invoices. All payments in connection with this Contract shall be made on
their respective due dates, or within thirty (30) days after Customer's receipt
of the corresponding invoice, whichever is later, except for the first two
payments for the base-lined Launch Services and the first payment for each
Optional Launch Service, which shall be made at the times set forth above.
Payments shall be deemed made upon delivery of notice to Contractor that a valid
check for the payable amount is available to be picked up at the above address.
5.4 Interest on Payments Due. If any amount due to either Party under this
Contract shall remain unpaid after its due date, then the paying Party shall pay
simple interest to the other Party [CONFIDENTIAL MATERIAL REDACTED]. Interest
will be computed commencing on the due date to but not including the day payment
is actually made. The Party owed the interest shall provide the paying Party an
invoice for payment (due within thirty (30) days after receipt of the invoice)
of the interest as soon as practicable after the paying Party has completed its
payment obligations on the original amount due.
5.5 Accelerated Payments. In the event that any Launch Service is accelerated as
described in Article 7 entitled "Launch Schedule Adjustments," the next payment
due for such Launch Service following such acceleration shall be increased to
include the balance
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CONFIDENTIAL TREATMENT
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of the payments that would have been made had the Contract payments been
scheduled on the basis of the accelerated Launch Period.
5.6 Postponed Payments.
5.6.1 Postponements by Contractor. In the event of postponement
declared by Contractor for any reason including without limitation those in
Article 7 entitled "Launch Schedule Adjustments," the Contract payments shall be
suspended for the length of the delay and then resumed with all remaining
payments postponed by the amount of the delay, except for any payments due after
Launch.
5.6.2 Postponements by Customer. In the event of postponement declared
by Customer for any reason including those in Article 7 entitled "Launch
Schedule Adjustments," the Contract payments, including due dates, will not be
affected and shall remain [CONFIDENTIAL MATERIAL REDACTED]
ARTICLE 6
LAUNCH SCHEDULE
6.1 Launch Period. The Launch Period(s) for the Launch Service(s) shall be as
follows:
Launch Period Launch Service Satellite
------------- -------------- ---------
#1: 01 October through 31 December 2001 Atlas IIIB(d) EchoStar VII
#2: 01 January through 31 March 2002 Proton K/Block DM EchoStar VIII
[CONFIDENTIAL MATERIAL REDACTED]
Customer shall use its reasonable commercial efforts to support the Launches
during the Launch Periods stated above.
6.2 Determination of Launch Slot. A one month Launch Slot shall be established
at least six months prior to the first day of the Launch Period in accordance
with the following procedure. The Contractor will give notice to the Customer of
a proposed Launch Slot within the Launch Period taking into account the
requirements for a Launch Opportunity. The Parties will cooperate in good faith
to agree on the selection of the Launch Slot. However, in the event that the
Parties cannot mutually agree upon a Launch Slot within thirty (30) days of
Contractor's proposal, then Contractor shall make such selection, as close as
reasonably possible to the Customer's requirement, taking into account the
available Launch Opportunities and the requirements and interests of all
customers [CONFIDENTIAL MATERIAL REDACTED]
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Launch Date. A Launch Date shall be established at least three months prior to
the first day of the Launch Slot, once established, in accordance with the
following procedure. The Contractor will give notice to the Customer of a
proposed Launch Date within the Launch Slot taking into account the requirements
for a Launch Opportunity and general constraints on the satellite injection into
the required orbit. The Parties will cooperate in good faith to agree on the
selection of the Launch Date. However, in the event that the Parties cannot
mutually agree upon a Launch Date within fifteen (15) days of Contractor's
proposal, then Contractor shall make such selection, [CONFIDENTIAL MATERIAL
REDACTED], taking into account the available Launch Opportunities and the
requirements and interests of all customers [CONFIDENTIAL MATERIAL REDACTED]
ARTICLE 7
LAUNCH SCHEDULE ADJUSTMENTS
7.1 Customer Launch Schedule Adjustments. Notwithstanding Customer's obligation
to use its reasonable commercial efforts to support the Launches during the
Launch Periods stated in Section 6.1 above, Customer may request either a
postponement or advancement of the Launch Period, Launch Slot or Launch Date
previously determined under Article 6 of this Contract entitled "Launch
Schedule," by giving written notice to Contractor requesting a new Launch
Period, Launch Slot or Launch Date. If the launch schedule adjustment results in
a later Launch Period, Launch Slot or Launch Date, then the total number of
calendar days of delay requested by Customer shall be attributed to Customer.
The Parties will cooperate in good faith to select a new Launch Period, Launch
Slot or Launch Date. However, in the event that the Parties cannot mutually
agree within sixty (60) days of Customer's notice (or such shorter time period
as Contractor may determine, in light of the proximity to the Launch),
Contractor shall make such determination taking into account the available
Launch Opportunities and the requirements and interests of all customers
[CONFIDENTIAL MATERIAL REDACTED]
7.1.1 Base-lined Launch Services. Actual postponements or notices of
postponement by Customer under this Article 7 for each base-lined
Launch Service shall not extend beyond [CONFIDENTIAL MATERIAL
REDACTED], after which date Contractor shall have the right to
terminate the Launch Service pursuant to Section 21.4. In the event
that a single actual postponement or notice of postponement, or
cumulative actual postponements or notices of postponement, attributed
to Customer of a base-lined Launch Service exceed a total of
[CONFIDENTIAL MATERIAL REDACTED]
7.1.2 Optional Launch Services. Actual postponements or notices of
postponement by Customer under this Article 7 for each Optional Launch
Service exercised by Customer shall not extend beyond [CONFIDENTIAL
MATERIAL REDACTED], after which Contractor shall have the right to
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terminate the Launch Service pursuant to Section 21.4, [CONFIDENTIAL
MATERIAL REDACTED]
7.1.3 Should Range Support by the United States government be initiated
prior to the receipt of Customer's notice of postponement or prior to
the determination of a final Launch Period or Launch Date as described
in Section 7.1 that is different from the then-current launch schedule,
Customer will be liable for the costs charged to Contractor by the
United States government (on a pass-through basis, without mark-up) for
any such Range Support during the period from and including six (6)
days before the then-current Launch Date until such Range Support
ceases. Such costs will be paid within thirty (30) days of receipt of
the Contractor's invoice and shall in no event exceed a total amount of
[CONFIDENTIAL MATERIAL REDACTED] for the baselined Atlas Launch
Service. For each Atlas Optional Launch Service exercised by Customer,
[CONFIDENTIAL MATERIAL REDACTED]. Range Support, as used in the
preceding sentence, means those activities conducted by the United
States government in connection with a Launch Service as described in
Exhibit A entitled "Atlas Launch Services Statement of Work for the
EchoStar Program" and supplies used in connection therewith, including
supplying and loading of rocket propellant into the Launch Vehicle, and
shall be coordinated by Contractor.
[CONFIDENTIAL MATERIAL REDACTED]
7.2 Contractor Launch Schedule Adjustments. Contractor may postpone or request
an advancement of the Launch Period, Launch Slot or Launch Date previously
determined under Article 6 entitled "Launch Schedule" by giving notice to
Customer proposing a new Launch Period, Launch Slot or Launch Date. The Parties
will cooperate in good faith to select a new Launch Period, Launch Slot or
Launch Date. However, in the case of a postponement, if the Parties cannot
mutually agree within sixty (60) days of Contractor's proposal (or such shorter
time period as Contractor may determine, in light of the proximity to the
Launch), Contractor shall make such determination in good faith taking into
account the available Launch Opportunities and the requirements and interests of
all customers [CONFIDENTIAL MATERIAL REDACTED]. Until the new Launch Period,
Launch Slot or Launch Date is selected in accordance with this Section 7.2, the
then-current launch schedule shall remain in effect.
7.2.1 If the final launch schedule adjustment results in a later Launch
Period, Launch Slot or Launch Date, then the total number of calendar
days of delay originally requested by Contractor shall be attributed to
Contractor.
7.2.2 Postponements by Contractor under this Article 7 shall not exceed
a total of [CONFIDENTIAL MATERIAL REDACTED] for each Launch Service. In
the event that a single actual postponement or notice of postponement,
or cumulative actual postponements or notices of postponement,
attributed to Contractor exceed such maximum permissible postponement
for any one Launch
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Service, that Launch Service shall, at the election of Customer, be
subject to termination by Customer in accordance with Section 21.2.1.
7.3 Reserved.
7.4 Excusable Delays. [CONFIDENTIAL MATERIAL REDACTED], days during which an
Excusable Delay exists as defined in Article 8 entitled "Excusable Delays" and
which affect the launch schedule will not be included in determining the length
of a postponement attributable to either Contractor or Customer under this
Article 7.
7.5 Reserved.
7.6 Postponements Attributed to Non-Complying Party under Article 10. Should the
failure of either Party to provide required data, hardware and services result
in a delay to the launch schedule, then such delay shall be deemed a
postponement attributed to the non-complying Party in accordance with this
Article 7. Requirements to provide data, hardware and services, delays and the
consequences of postponement attributable to the non-complying Party are
described in Article 10 entitled "Additional Contractor and Customer Obligations
Prior to Launch."
7.7 Obligation to Give Prompt Notice. Contractor and Customer acknowledge and
agree that it is in the best interests of both Parties to promote certainty in
launch schedule decisions and minimize disruption to other customers of
Contractor. Therefore, the Parties agree to give prompt notice of any need for
schedule change under this Article 7 or any actual or potential delay that might
impact the launch schedule.
ARTICLE 8
EXCUSABLE DELAYS
[CONFIDENTIAL MATERIAL REDACTED]
8.2 Notice(s) of Excusable Delays. Contractor and Customer each acknowledge and
agree that it is in the best interests of both Parties to promote certainty in
launch schedule decisions and minimize disruption to other customers of
Contractor. Therefore, the Parties agree to give prompt notice of any actual or
potential Excusable Delay under this Article 8.
ARTICLE 9
COORDINATION AND COMMUNICATION BETWEEN
CUSTOMER AND CONTRACTOR
9.1 Mission Managers and Program Directors. Each Party hereby identifies to the
other the following Program Manager, Mission Manager and Program Directors to
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coordinate the activities under this Contract. The Program Manager, Mission
Manager and Program Directors are not authorized to direct work contrary to the
requirements of this Contract or make modifications to this Contract. All
modifications to the terms, conditions and requirements of this Contract shall
be made pursuant to Article 26 entitled "Amendment."
Contractor Program Directors are:
Mr. Marv Steinman (primary)
Ms Ann Wildgen (Atlas back-up)
Mr. John Casani (Proton back-up)
Contractor's Atlas Program Manager is:
Mr. Tony Narde
Contractor's Proton Program Directors are:
Mr. Vladimir Bronfman (LMCSS Satellite)
Mr. Vitaly Lopan (Loral Satellite)
Customer's Mission Manager is:
Mr. Rohan Zaveri
[CONFIDENTIAL MATERIAL REDACTED]
9.3 Notices. All notices that are required or permitted to be given under this
Contract shall be in writing and shall be delivered in person or sent by
telefax, certified mail (return receipt requested) or air courier service to the
representative and address set forth below, or to such other representative or
address specified in a notice to the other Party. Notices shall be deemed
effective upon delivery in person or upon confirmation of receipt in the case of
telefax, certified mail or air courier.
Notices to Contractor:
Mr. Jack Zivic
Manager, Business Operations
International Launch Services
12999 Deer Creek Canyon Road
M/S DC1400
Littleton, Colorado 80127-5146
Fax: (303) 971-9456
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Notices to Customer:
Mr. Rohan Zaveri
Director of Space Programs
EchoStar Orbital Corporation
5701 S. Santa Fe Drive
Littleton, Colorado 80120
Fax: (303) 723-1099
with copies to:
Charlie Ergen
President and Chief Executive Officer
(same address and fax number as above)
David Moskowitz
Senior Vice President and General Counsel
(same address as above)
Fax: (303) 723-1699
9.4 Communications in English. All documentation, notices, reports and
correspondence under this Contract shall be in the English language. Contractor
will translate all appropriate documents from Khrunichev and provide Russian
translators for Khrunichev personnel as necessary for meetings, regardless of
location.
ARTICLE 10
ADDITIONAL CONTRACTOR AND CUSTOMER OBLIGATIONS
PRIOR TO LAUNCH
10.1 Obligation to Provide Information. Contractor shall provide to Customer the
data, hardware and services identified in Section 6 of Exhibit A entitled "Atlas
Launch Services Statement of Work for EchoStar Program" and Section 6 of Exhibit
C entitled "Proton Launch Services Statement of Work for EchoStar Program" and
Customer shall provide to Contractor the data, hardware and services identified
in Section 6 of Exhibit A entitled "Atlas Launch Services Statement of Work for
EchoStar Program" and Section 6 of Exhibit C entitled "Proton Launch Services
Statement of Work for EchoStar Program,"
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in accordance with the schedules contained therein. The data, hardware and
services shall be delivered in a condition suitable for their intended use.
10.2 Notification of Non-Compliance. The Party receiving the data, hardware or
services referred to in Section 10.1 shall promptly notify the other in
accordance with Section 9.3 in the event the data, hardware or services are not
consistent with the requirements contained in the applicable Statement of Work
or are delivered in a condition not suitable for their intended purpose. The
notification shall contain a statement of the discrepancy and recommend
solutions. The Party receiving the notification shall provide written direction
to the other Party as to how to proceed, taking into account the recommended
solutions within seven (7) days following receipt of notice.
10.3 Impact of Non-Compliance on Launch Schedule. In the event that the data,
hardware or services to be supplied by one Party to the other, in accordance
with Section 10.1 above, are not furnished in accordance with the required
schedules set forth in the applicable Statement of Work or are delivered in a
condition not suitable for their intended purpose, the receiving Party shall use
reasonable commercial efforts to continue its obligations under this Contract
without affecting the launch schedule or incurring additional expense. If
however, despite the receiving Party's reasonable commercial efforts, such
continuation is not possible and, as a result of the other Party's failure to
provide data, hardware or services as required in accordance with Section 10.1
above, the launch schedule is adversely affected, then a launch schedule
postponement shall be declared by the receiving Party under the appropriate
provisions of Article 7 attributable to the Party failing to provide the data,
hardware or services as required by the applicable Statement of Work or failing
to deliver the data, hardware or services in a condition suitable for their
intended purpose.
ARTICLE 11
FACTORY AND LAUNCH SITE ACCESS
[CONFIDENTIAL MATERIAL REDACTED]
ARTICLE 12
LICENSES, CLEARANCES AND PERMITS AND COMPLIANCE WITH UNITED STATES GOVERNMENT
REQUIREMENTS FOR ATLAS LAUNCH SERVICES
12.1 Responsibility for Licenses, Clearances and Permits. Each Party shall be
responsible for obtaining any licenses, clearances, permits and governmental
authorizations, and for taking any actions, necessary to carry out its
obligations under this Contract. Each Party shall use its reasonable commercial
efforts to cooperate with the other Party and provide without cost all
reasonable and necessary support for the other
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Party to apply for and maintain such licenses, clearances, permits and
governmental authorizations.
12.2 Transfers of Technical Data. Each Party shall be responsible for compliance
with applicable United States government laws and regulations relating to the
transfer of technical data to the other Party or to Third Parties.
12.3 Customer Compliance with Requirements. Contractor has executed agreements
with various United States government agencies for use of United States
government-owned property and facilities relating to launch operations at CCAS
in Florida. Customer and Contractor agree that they will comply with the United
States government's laws, regulations, policies and directives as they relate to
the performance of this Contract. Customer will indemnify Contractor and
Contractor will indemnify Customer for any direct damages arising from violation
of such laws, regulations, policies or directives by the indemnifying Party or
its Related Third Parties. The Parties shall, before Launch, execute and deliver
the Agreement for Waiver of Claims and Assumption of Responsibility, the
execution of which is required by the United States Department of Transportation
(C.F.R. Section 440.17(c)), as a condition of granting Contractor's license to
conduct launch activities and Launch the Satellite.
12.4 Government Need. It is the policy of the United States government to
support the commercialization of domestic launch services by making available to
United States launch services providers its launch-related facilities. However,
both Customer and Contractor agree that, in the event of imperative national
need as set forth in the CSLA (49 U.S.C. Section 70109), the United States
government may require use of United States government or Contractor property
and personnel. In the event such use by the United States government
necessitates subsequent rescheduling of Customer's Launch Service(s), Contractor
will promptly notify Customer of the delay(s) and will reschedule any affected
Launch Service(s) to accommodate all customers to the extent possible. Such
delay shall be considered an Excusable Delay under Article 8. The United States
government shall not be liable to Customer for any costs or damages, including
any direct, indirect, special, incidental or consequential damages or any other
revenue or business injury or loss, arising out of a delay caused by such
priority use of property or personnel.
12.5 Compliance with U.S. Government Export/Import Statutes and Regulations.
12.5.1 Customer and Contractor hereby acknowledge that they will comply
with all applicable statutes, regulations and licenses relating to the
export and import of commodities, services or technical data out of and
into the United States of America.
12.5.2 Customer acknowledges that Contractor must refuse to admit to
any meeting and refuse to transmit any commodities, technical data or
provide any defense services to a non-U.S. citizen participant who is
not covered by an
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17
applicable license or agreement issued by the United States government
and duly executed by the appropriate parties.
ARTICLE 13
GOVERNMENTAL APPROVALS, LICENSES, CLEARANCES, PERMITS AND COMPLIANCE WITH
REQUIREMENTS FOR PROTON LAUNCH SERVICES
13.1 Parties Respective Obligations. Unless otherwise specified in this
Contract, each Party is responsible for obtaining all governmental approvals,
including without limitation any licenses, clearances or permits, from any
governmental authority which has jurisdiction or authority to require such
approvals, licenses, clearances or permits necessary to carry out such Party's
respective obligations in accordance with this Contract.
13.2 Mutual Assistance. The Parties shall use reasonable commercial efforts to
cooperate and provide each other upon request and without cost all reasonable
and necessary assistance in obtaining any and all governmental approvals which
they may respectively be required to obtain pursuant to this Contract.
13.3 Documentation. The Parties shall provide to each other upon request and
without cost, acceptable documents or other reasonable evidence to show that
they have obtained any and all governmental approvals which they respectively
are required to obtain pursuant to this Contract.
13.4 Satellite Approvals. Unless otherwise specified herein, Customer shall
obtain all governmental approvals necessary for the transfer of the Satellite
and any Customer furnished items from the Satellite's country of origin to the
Launch Site, and Customer agrees to provide and comply with any and all
assurances which it may be required to provide to the government of the country
of origin under that country's laws and regulations so that Customer may obtain
such governmental approvals.
13.5 Launch Vehicle and Launch Site Approvals. Except as provided by Section
13.4, Contractor shall obtain all governmental approvals necessary for the
transfer of the Launch Vehicle and any auxiliary equipment to the Launch Site
and shall obtain all governmental approvals necessary for the use of the Launch
Site and its facilities.
[CONFIDENTIAL MATERIAL REDACTED]
13.7 U.S. Export Requirements. Contractor's performance hereunder is subject to
all laws, rules and regulations, including any requirements set forth in
applicable licenses and approvals of the United States regarding the export of
information and technology, including the United States Department of State
International Traffic in Arms Regulations (ITAR) and export control regulations
of the United States Department of Commerce. Contractor shall use its best
efforts to comply with such licenses and approvals.
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13.8 Contractor Assistance for Proton Launch Services. Contractor will assist
the Customer and its directors, officers, agents and employees with all
administrative arrangements necessary in connection with the transportation of
each Satellite and Customer's and its Related Third Parties' personnel, from the
point of entry into the territory of Russia or Kazakhstan, to the Launch Site,
and for the storage of each Satellite in the above-mentioned territories.
Contractor shall take all necessary steps before each Satellite is shipped to
the above-mentioned territories, or any of the Customer or its Related Third
Parties' personnel visit said territories for the purposes of this Contract, to
obtain all necessary consents and permissions from the relevant government
authorities as may be required to permit the bringing of such Satellite into
said territories and the entry and stay in the said territories of all such
personnel. This paragraph shall not be interpreted as requiring Contractor to
bear the cost of travel and accommodations for Customer or Customer's
Affiliates.
13.9 Security. Customer shall abide by and require its employees, agents and
subcontractors to abide by all applicable United States and Russian and Kazakh
government and Contractor security rules and regulations while they are on
Contractor or its Related Third Parties' premises in connection with this
Contract.
13.10 Export Requirements. When applicable or required, Contractor and Customer
agree that all exports of goods and data made pursuant to this Contract shall be
in strict compliance with all laws, rules and regulations of the United States
regarding exportation and re-exportation of technical data including the United
States Department of State International Traffic in Arms Regulations (ITAR), the
export regulations of the United States Department of Commerce, and the
requirements of any export license issued by the United States government.
13.11 Customer acknowledges that Contractor must refuse admittance to any
meeting or transmission of any commodities, technical data or provision of
defense services to a non-U.S. citizen participant who is not covered by an
applicable license or agreement issued by the United States government and duly
executed by the appropriate parties.
ARTICLE 14
COMPLETION OF CONTRACTOR'S OBLIGATION
TO PROVIDE LAUNCH SERVICES
Each Launch Service to be provided under this Contract shall be considered
complete upon Launch and the submission of data required by the applicable
Statement of Work. A Launch shall not be deemed complete in the event of a
Terminated Ignition.
ARTICLE 15
EXCLUSION OF WARRANTY AND WAIVER OF LIABILITY
AND ALLOCATION OF CERTAIN RISKS FOR ATLAS LAUNCH SERVICES
[CONFIDENTIAL MATERIAL REDACTED]
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ARTICLE 16
[CONFIDENTIAL MATERIAL REDACTED]
ARTICLE 17
INSURANCE
17.1 Third Party Liability Insurance for Atlas. Contractor shall procure and
maintain in effect insurance for third party liability to provide for the
payment of claims resulting from property loss or damage or bodily injury,
including death, sustained by Third Parties caused by an occurrence resulting
from Insured Launch Activities. The insurance shall have a limit of one hundred
and sixty-four million dollars ($164,000,000) per occurrence and in the
aggregate, or such other amount as may be required by the United States
Department of Transportation, whichever is higher. Coverage for damage, loss or
injury sustained by Third Parties arising in any manner in connection with
Insured Launch Activities shall attach upon arrival of the Satellite at CCAS or
the Satellite processing facility (wherever located), whichever occurs first,
and will terminate upon the earlier to occur of the return of all parts of the
Launch Vehicle to Earth or twelve (12) months following the date of Launch,
unless the Satellite is removed from the Satellite processing facility other
than for the purpose of transportation to CCAS or is removed from CCAS other
than by Launch, in which case, coverage shall extend only until such removal.
Such insurance shall not cover loss of or damage to the Satellite even if such
claim is brought by any Third Party or Related Third Parties. Such insurance
also shall not pay claims made by the United States government for loss of or
damage to United States government property in the care, custody and control of
Customer or Contractor.
17.2 Insurance Required by Atlas Launch License. Contractor shall provide such
insurance as is required by the launch license issued by the United States
Department of Transportation for loss of or damage to United States government
property.
17.3 Miscellaneous Requirements for Atlas. The third party liability insurance
required under Section 17.1 shall name as named insured Contractor and as
additional insureds Customer and the respective Related Third Parties of the
Parties identified by each Party, the United States government and any of its
agencies and such other persons as Contractor may determine. Such insurance
shall provide that the insurers shall waive all rights of subrogation that may
arise by contract or at law against the named insured or any additional insured.
17.4 Third Party Liability Insurance for Proton. Contractor shall procure and
maintain in effect insurance for third party liability to provide for the
payment of claims resulting from property loss or damage or bodily injury,
including death, sustained by Third Parties caused by an occurrence resulting
from Insured Launch Activities. [CONFIDENTIAL MATERIAL REDACTED] and in the
aggregate, or such other amount as may be
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required by the government of the Russian Federation, whichever is higher.
Coverage for damage, loss or injury sustained by Third Parties arising in any
manner in connection with Insured Launch Activities shall attach upon arrival of
the Satellite at the Launch Site and will terminate upon the earlier to occur of
the return of all parts of the Launch Vehicle to Earth or twelve (12) months
following the date of Launch, unless the Satellite is removed from the Satellite
processing area or the Launch Site other than by Launch, in which case, coverage
shall extend only until such removal. Such insurance shall not cover loss of or
damage to the Satellite even if such claim is brought by any Third Party or
Related Third Parties.
17.5 Property Insurance for Proton. Contractor shall provide such insurance as
may be required by applicable law or governmental authority within Russia and/or
Kazakhstan having jurisdiction over the Launch Site.
17.6 Miscellaneous Requirements for Proton. The third party liability insurance
required under Section 17.4 shall name as named insured Contractor and shall
name as additional insureds Customer and the respective Related Third Parties of
the Parties identified by each Party and such other persons as Contractor may
determine. Such insurance shall provide that the insurers shall waive all rights
of subrogation that may arise by contract or at law against the named insured or
any additional insured.
[CONFIDENTIAL MATERIAL REDACTED]
ARTICLE 18
REMEDIES AND LIMITATIONS ON REMEDIES
This provision is intended to highlight notice to the Parties of certain
exclusive rights and remedies of the Parties under this Contract, but shall not
be construed as being an all-inclusive list thereof. The exclusive rights and
remedies of a Party with respect to postponement of a Launch Period, Launch Slot
or Launch Date attributed to the other Party are as provided in [CONFIDENTIAL
MATERIAL REDACTED] and Sections 5.6.1, 5.6.2, 7.1.1, 7.1.2, 7.1.3, 7.1.4, 7.2.2,
21.2.1, 21.4 entitled "Termination by Contractor for Excessive Launch
Postponements" and 21.7 entitled "Termination Charge". The exclusive remedy for
failure by either Party to provide the data, hardware or services it is required
to provide pursuant to Section 10.1 shall be the adjustment in the Launch
Schedule contemplated in Section 10.3. Customer shall have no remedy against
Contractor in the event of a failure of the Launch Vehicle or other performance
of the Launch Service, other than as provided in Section 15.3 or 16.3, as
applicable, and Articles 17, 19 and 20. The exclusive rights and remedy of
Customer for claims by Third Parties for property loss or damage, personal
injury or bodily injury, including death, arising in any manner from the
operation or performance of the Launch Vehicle, to the extent such claims are
not otherwise eligible for payment as provided in Section 15.3.2 or 16.3.2, as
applicable, shall be the indemnification by Contractor as provided in Section
15.3.2 or 16.3.2, as applicable. The exclusive rights and remedy of Contractor
for claims by Third Parties for property loss or damage, personal injury or
bodily injury, including death,
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21
arising in any manner from the processing, testing, operation or performance of
the Satellite, to the extent such claims are not otherwise eligible for payment
as provided in Section 15.3.3 or 16.3.3, as applicable, shall be the
indemnification by Customer as provided in Section 15.3.3 or 16.3.3, as
applicable. The exclusive rights and remedy of the Parties for claims resulting
from the infringement, or claims of infringement, of patent rights or any other
intellectual property rights of a Third Party shall be the indemnification as
provided in Section 15.5 or 16.4, as applicable. The exclusive rights and remedy
of Customer to terminate this Contract for convenience are described in Section
21.1 entitled "Termination by Customer for Convenience." The exclusive rights
and remedy of Contractor to terminate this Contract in the event of nonpayment
are described in Section 21.3 entitled "Termination by Contractor for
Nonpayment." [CONFIDENTIAL MATERIAL REDACTED]. The exclusive rights and remedy
of Contractor in the event that, in connection with an Optional Launch Service,
a single postponement or cumulative postponements attributed to Customer exceeds
[CONFIDENTIAL MATERIAL REDACTED] requested by Customer, are described in Section
7.1.2. The exclusive rights and remedy of Contractor in the event that Customer
fails to perform its obligations under Section 17.8(a) above, are described in
Section 17.8(d) above.
ARTICLE 19
REFLIGHT LAUNCH OR REFUND PROTECTION
19.1 Reflight Launch or Refund. There is a single Contract Price for each Launch
Service to be provided hereunder which does not obligate the Contractor to
provide a Reflight Launch nor Refund of the Contract Price in the event of one
or more Launch Service failure(s). If Reflight Launch or Refund protection is
available from Contractor's insurers at the prices quoted herein, then Customer
shall have the right to purchase this protection as specified herein.
For the two base-lined Launch Services identified in Section 4.1, the price of
the reflight/refund insurance purchased by Contractor from its insurers is
[CONFIDENTIAL MATERIAL REDACTED] times the amount of coverage purchased.
Customer may elect protection in the form of: (a) either a Reflight Launch or
Refund, plus [CONFIDENTIAL MATERIAL REDACTED].
For the optional Launch Services identified in Section 4.2, no later than one
hundred and eighty (180) days prior to the Launch Slot or Launch Date, as
applicable, the Contractor, upon the Customer's request, shall provide a price
quotation to the Customer for: (a) protection in the form of either a Reflight
Launch or Refund, [CONFIDENTIAL MATERIAL REDACTED].
The Customer may elect either Reflight Launch or Refund protection in accordance
with this Article 19 by so notifying the Contractor within sixty (60) days of
receipt of Contractor's price quotation.
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22
Payments for the Reflight Launch or Refund protection shall be due to the
Contractor from Customer within thirty (30) days of receipt by Customer of
Contractor's invoice(s) (which will be issued in support of Contractor's payment
obligation to the insurers) or three (3) business days prior to the due date for
Contractor's corresponding payment to the insurers, whichever occurs later.
Reflight Launch protection will be available in the event of a Total Failure or
Constructive Total Failure as determined under Section 19.5 entitled "Failure
Review Board." Refund protection shall be available in the event of Total
Failure, Constructive Total Failure or Partial Failure, as determined under
Section 19.5 entitled "Failure Review Board." The following terms in this
Article 19 are indicative only, and will be amended to incorporate any
differences in the insurance policy purchased by Contractor on a pass-through
basis without mark-up.
19.2 Terms Governing Reflight Launch. The following conditions will apply if
Customer has elected Reflight Launch protection:
19.2.1 Customer will continue to pay the Contract Price, as specified
in Article 4 entitled "Contract Price" for the Launch Service, which
excludes the adjustment for the Reflight Launch Fee which is paid
separately per Section 19.1.
19.2.2 One (1) Reflight Launch will be provided in the event that a
Launch Service is a Total Failure or Constructive Total Failure only
and not for a Partial Failure, all as determined under Section 19.5
entitled "Failure Review Board." Customer's right to a Reflight Launch
in connection with one Launch Service is not transferable to another
Launch Service, if any, under this Contract. Any Reflight Launch(es) to
which Customer may be entitled under this Contract shall be deemed to
be Launch Service(s) for all purposes under this Contract, except that
Customer shall not be entitled to a second Reflight Launch following a
failure of a Reflight Launch.
19.2.3 Contractor will conduct a Reflight Launch within [CONFIDENTIAL
MATERIAL REDACTED] of receipt of written notice from Customer
requesting such Reflight Launch.
19.2.4 Reflight Launch protection does not include the cost of the
replacement satellite, which cost shall be borne by Customer.
19.2.5 The Reflight Launch will be governed by the terms and conditions
of this Contract, except for [CONFIDENTIAL MATERIAL REDACTED] Article 5
entitled "Payment."
19.2.6 The configuration and mission requirements of the replacement
satellite must conform as closely as reasonably possible to the mission
description contained in Exhibit B entitled "EchoStar VII Interface
Control Document" or Exhibit D entitled "EchoStar VIII Interface
Control Document", as applicable.
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19.2.7 In the performance of any Reflight Launch, Contractor reserves
the right to substitute for the Launch Vehicle any other launch vehicle
[CONFIDENTIAL MATERIAL REDACTED]
19.3 Terms Governing Refund. The following conditions will apply if Customer
elects Refund protection:
19.3.1 Customer will continue to pay the Contract Price, as specified
in Article 4 entitled "Contract Price" for the Launch Service which
excludes the Refund Fee which is paid separately per Section 19.1.
19.3.2 In the event that the Launch Service is a Total Failure or
Constructive Total Failure, as determined under Section 19.5 entitled
"Failure Review Board," Contractor shall pay to Customer a Refund equal
to the applicable level of protection purchased by Customer.
19.3.3 In the event that the Launch Service is a Partial Failure, as
determined under Section 19.5 entitled "Failure Review Board,"
Contractor shall pay to Customer a Refund equal to a prorated amount of
the applicable level of protection purchased by Customer. Customer's
right to a Refund in connection with one Launch Service is not
transferable to another Launch Service, if any, under this Contract.
The proration to be applied to determine the appropriate Refund shall
be calculated as follows:
Proration = 3.333 X (80% - Cp) X 80%
Where, Cp (capability percentage) equals the percentage, if
any, greater than fifty percent (50%) of the greater of: (i)
planned lifetime (less any margin), or (ii) operational
capacity (after application of all redundant and spare
components) expected after Partial Failure.
19.3.4 Refunds [CONFIDENTIAL MATERIAL REDACTED]
19.3.5 In no event shall the aggregate amount of any Refund in
connection with a Launch Service exceed the applicable level of
protection purchased by Customer.
19.4 Terms Applicable to Both Reflight Launch and Refund. [CONFIDENTIAL MATERIAL
REDACTED]
ARTICLE 20
REPLACEMENT LAUNCH
20.1 Terms Governing Replacement Launch Service. Customer may request a
Replacement Launch Service in the event of Launch Vehicle failure or Satellite
failure by giving written notice to Contractor of such request within
[CONFIDENTIAL
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24
MATERIAL REDACTED] of Launch in which a Constructive Total Failure
or Total Failure has occurred.
20.1.1 Contractor will conduct the Replacement Launch within the period
of [CONFIDENTIAL MATERIAL REDACTED] of receipt of Customer's written
notice requesting such Replacement Launch, taking into consideration
all of the requirements for a Launch Opportunity, provided that
Contractor will use its reasonable commercial efforts to conduct the
Replacement Launch as early as possible.
20.1.2 A Replacement Launch Service does not include replacement cost
of the Satellite.
20.1.3 The Replacement Launch Service shall be governed by the terms
and conditions of this Contract, except that a Replacement Launch
Service shall not be available for the Replacement Launch Service
provided in accordance with this Article 20 nor shall it be covered by
[CONFIDENTIAL MATERIAL REDACTED]. Except as otherwise provided in this
Article 20, the Replacement Launch to which Customer may be entitled
under this Contract shall be purchased as an Optional Launch Service in
accordance with Article 3 and then deemed to be a Launch Service for
all purposes under this Contract, [CONFIDENTIAL MATERIAL REDACTED]
20.1.4 The configuration and mission requirements of the replacement
satellite shall conform as closely as reasonably possible to the
mission description contained in Exhibit B entitled "EchoStar VII
Interface Control Document" or Exhibit D entitled "EchoStar VIII
Interface Control Document", as applicable.
20.1.5 Contractor shall not be obligated to provide a Replacement
Launch to Customer in the event that Customer is entitled to a Reflight
Launch under the provisions of Article 19 of this Contract.
ARTICLE 21
TERMINATION
21.1 Termination by Customer for Convenience. Customer may terminate any Launch
Service under this Contract for any reason following written notice to
Contractor given at least thirty (30) days prior to the then-scheduled Launch
Period, Launch Slot, or Launch Date. If Customer terminates a Launch Service
under this Section 21.1, Contractor shall be entitled to retain the Termination
Charge set forth in Section 21.7.
21.2 Termination by Customer for Cause.
21.2.1 Customer may terminate a Launch Service under this Contract for
excessive postponements by Contractor only as expressly permitted in
Article 7
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CONFIDENTIAL TREATMENT
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entitled "Launch Schedule Adjustments". [CONFIDENTIAL MATERIAL
REDACTED]
21.3 Termination by Contractor for Non-Payment. Except for a bona fide dispute
concerning payments, Contractor may terminate a Launch Service under this
Contract if Customer fails to make any payment to Contractor relating to such
Launch Service on the due date as required by this Contract, provided Customer
fails to remedy such non-payment within [CONFIDENTIAL MATERIAL REDACTED] of
notice from Contractor describing such non-payment and stating Contractor's
intent to terminate the Launch Service. If Contractor terminates a Launch
Service in accordance with this Section 21.3, Contractor shall be entitled to
the Termination Charge set forth in Section 21.7.
21.4 Termination by Contractor for Excessive Launch Postponements. Contractor
may terminate a Launch Service under this Contract for excessive postponements
by Customer only as expressly permitted in Article 7. If Contractor does not
provide a notice of termination to Customer within [CONFIDENTIAL MATERIAL
REDACTED] of postponement or notice of postponement by Customer, Contractor
waives its right to terminate the postponed Launch Service under this Section
21.4 unless Customer further postpones the Launch Service under Article 7. If
Contractor terminates a Launch Service in accordance with this Section 21.4,
Contractor shall be entitled to retain the Termination Charge set forth in
Section 21.7.
[CONFIDENTIAL MATERIAL REDACTED]
21.6 Termination Date. The effective termination date of any Launch Service or
the Contract terminated under this Article 21 shall be the date of receipt of
notice of termination.
21.7 [CONFIDENTIAL MATERIAL REDACTED]
21.8 Effect of Termination. If either Party terminates one or more Launch
Service(s) or this Contract under this Article 21, both Parties' obligations
under this Contract with respect to such Launch Service(s) or the entire
Contract, as applicable, shall be discharged as of the Launch Service(s)' or
Contract's, as applicable, effective termination date except that Customer's
obligation to pay the Termination Charge described in Section 21.7 and
Contractor's obligation to reimburse certain amounts to Customer under Section
21.2.7 and 21.7 shall survive the termination of this Contract. If less than all
Launch Service(s) to be furnished under this Contract are terminated pursuant to
this Article 21, the provisions of this Article shall apply to the terminated
Launch Service(s) only, and the Parties shall continue to perform their
obligations with respect to any Launch Service(s) not terminated under this
Article. If all remaining Launch Service(s) to be furnished under this Contract
are terminated pursuant to this Article 21, the entire
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CONFIDENTIAL TREATMENT
26
Contract shall be deemed to have been terminated as of the effective termination
date of the last terminated Launch Service.
ARTICLE 22
DISPUTE RESOLUTION
22.1 Dispute Resolution. Any dispute arising under or relating to this Contract
or the breach thereof, including any dispute concerning the validity, scope or
enforceability of this provision, that is not promptly resolved directly by the
Parties shall be resolved through negotiation, mediation, arbitration or court
proceedings as set forth in this Article 22. The use or attempted use of any
alternative dispute resolution procedures, such as negotiation, mediation,
arbitration or any other non-court procedure shall not be construed under the
doctrines of laches, waiver, estoppel or res judicata to affect adversely the
rights of either Party, unless otherwise agreed upon by the Parties as part of
the relevant alternative dispute resolution procedure.
22.2 Negotiation. Any dispute arising hereunder that is not promptly resolved by
the individuals identified in Article 9 shall be referred to the senior
management of Contractor and Customer designated by the Parties. If such senior
management cannot satisfactorily resolve the dispute in a timely fashion, as
reasonably determined by either Party, the matter shall be resolved through
mediation, arbitration or court proceedings as provided below.
22.3 Mediation. Any dispute arising hereunder that is not promptly resolved
through the negotiation procedure described in Section 22.2 shall be referred to
mediation. Mediation shall be an informal, non-binding dispute resolution
process mutually agreed by the Parties or by a mutually acceptable alternative
dispute resolution organization. If such mediation does not satisfactorily
resolve the dispute, such dispute shall be referred to arbitration as provided
below.
22.4 Arbitration. If any dispute arising hereunder is not promptly resolved
through negotiation or mediation within a period of sixty (60) days, either
Party may request, by written notice to the other Party ("Notice of
Arbitration"), that the dispute be settled by arbitration in accordance with
terms and conditions of this Section 22.4, subject to the consent of the other
Party.
22.4.1 Rules. Arbitration proceedings in connection with this Contract
shall be administered in accordance with the provisions of the
[CONFIDENTIAL MATERIAL REDACTED]
22.4.2 Language. Arbitration proceedings in connection with this
Contract shall be conducted in the English language, provided that at
the request and expense of the requesting Party, documents and
testimony shall be translated into any language specified by the
requesting Party.
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22.4.3 Locale of Meetings and Selection of Arbitrators. Any such
arbitration shall be conducted in [CONFIDENTIAL MATERIAL REDACTED] by a
panel of three arbitrators who shall be selected within sixty (60) days
of such Notice of Arbitration, as follows: (i) one arbitrator shall
selected by each Party; and (ii) the third arbitrator shall be selected
by the arbitrators chosen by the Parties. In resolving any dispute, the
arbitrators shall apply the substantive laws of the State of New York
(without regard to its conflict of law rules), [CONFIDENTIAL MATERIAL
REDACTED], and shall take into account usages, customs and practices in
the performance of contracts for commercial launch services.
22.4.4 Injunctive Relief. Neither Party to this Contract may make an
application to the arbitrators seeking injunctive relief with respect
to the performance by the Parties of this Contract.
22.4.5 Consolidation. Arbitration proceedings in connection with this
Contract may be consolidated with arbitration proceedings pending
between a Party and any subcontractor if the arbitration proceedings
arise out of the same transaction or relate to the same subject matter
and if such Party and subcontractors are bound by an arbitration
agreement that is substantially similar to that contained in this
Contract. If proceedings are consolidated, all references to Party in
this Section 22.4 shall also mean subcontractor.
22.4.6 Review of Decision. Any decision rendered by the arbitrators of
a dispute arising under this Contract may be submitted by either Party
for review by a court of competent jurisdiction in accordance with
Article 27.
22.4.7 Awards and Judgment. The arbitrators shall have no authority to
award punitive damages, or any other damages except as authorized under
the express terms and conditions of this Contract. For example and
without limitation of the foregoing, in no event shall any award to
either party exceed the applicable limitations set forth in Sections
15.10, 15.11, 16.8 or 16.9. Either Party shall have the right to
subject any decision of the arbitrators for review by a court of
competent jurisdiction.
22.4.8 Confidentiality. Without the prior written consent of the
Parties to any arbitration proceeding in connection with this Contract,
no Party or arbitrator may disclose (a) the existence, content or
results of such proceeding, or (b) any information or documents
disclosed by any Party in connection with such proceeding.
22.4.9 Fees and Expenses. Each Party shall bear its own costs and
expenses (including the costs and expenses of the arbitrator it
selected) and one-half of the costs and expenses of the third
arbitrator, unless otherwise determined in the arbitral award.
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22.5 Court Proceedings. Any dispute that is not resolved otherwise by the
Parties through negotiation, mediation or arbitration as provided in this
Article 22 may be submitted for resolution to a court of competent jurisdiction
in accordance with Article 27. With respect to any court proceedings, any
information deemed by either Party to be of a commercially sensitive nature
shall be entitled to the protection afforded by protective orders issued by a
court of competent jurisdiction.
ARTICLE 23
CONFIDENTIALITY
23.1 Contract Provisions
23.1.1 Each Party shall make reasonable commercial efforts to assure
that its employees do not disclose the terms or conditions of this
Contract, except as may be required to perform this Contract, to
acquire insurance or the benefit thereof, in support of arbitration or
legal proceedings relating hereto, as required by their respective
governments, or in the normal course of reporting to its parent
company.
23.1.2 No publicity or information regarding this Contract will be
given or released without the prior written consent of the other Party.
Consent to release of information by either Party shall not be
unreasonably withheld.
23.2 Proprietary Data. It is recognized that Customer and Contractor each will
have developed technical information relating to the mating and launching of the
Launch Vehicle and the Satellite which will be exchanged between the Parties. To
the extent that such data is considered "Proprietary Information" by either
Party (and, if disclosed in writing, is conspicuously marked "Proprietary" and,
if disclosed orally, is identified as "Proprietary Information" at the time of
disclosure), such disclosures shall be handled in accordance with this Article
23.
23.2.1 In addition, "Proprietary Information" (i) shall be that
business, financial, technical or other information, data or material
in written form that is conspicuously marked "Proprietary," and that is
delivered by Contractor or by Customer to the other Party and (ii)
shall include all copies in whole or in part made of such information,
data or material or derivative uses thereof. Oral disclosure, if
identified as "Proprietary Information" at the time of disclosure, will
be treated as proprietary under this Article.
23.2.2 Each Party agrees not to use the other Party's Proprietary
Information for any purpose other than for the performance of this
Contract. Any other use or disclosure of such Proprietary Information
shall be made only upon prior written consent of the other Party.
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23.2.3 Each Party agrees to restrict disclosures of the Proprietary
Information of the other Party to only those having a need to know in
the performance of this Contract and to have all such Proprietary
Information protected with a level of care similar to that normally
used to protect its own Proprietary Information within its own
organization, and in all events at least a reasonable degree of care.
If such care is used, the recipient shall not be liable for the
unauthorized disclosure of Proprietary Information.
23.2.4 The aforementioned restrictions on use and disclosure of
Proprietary Information will not apply:
23.2.4.1 If either Party can show that the
Proprietary Information received from the
other is or has become generally available
through the public domain without fault of
such Party;
23.2.4.2 If the Proprietary Information is in a
written record in one Party's files prior to
its receipt from the other Party and is not
otherwise restricted as to its use or
disclosure;
23.2.4.3 If either Party at any time lawfully obtains
the Proprietary Information in writing from
a Third Party under circumstances permitting
its disclosure;
23.2.4.4 If the Proprietary Information is disclosed
with the prior written consent of the other
Party, provided such disclosure complies in
all respects with the terms of the written
consent;
23.2.4.5 When the Proprietary Information is
disclosed more than six (6) years after the
date of receipt of the information.
23.2.4.6 If the Party can show that it developed the
information independently without reliance
upon the other Party's Proprietary
Information.
23.2.5 Upon termination or expiration of this Contract, the Parties,
within a reasonable period of time, will return all Proprietary
Information received from the other Party under the terms of this
Contract or certify that all the Proprietary Information has been
destroyed.
23.2.6 It is understood that neither Party assumes any liability to the
other for damages arising from the other Parties use of or reliance
upon any Proprietary Information disclosed pursuant to this Article
except as provided elsewhere herein.
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ARTICLE 24
INTELLECTUAL PROPERTY
24.1 Neither Party will acquire, as a result of the services to be provided
under this Contract, any rights to the inventions, patents, copyrights,
trademarks, or other technical property or any rights to the proprietary data of
the other Party or the Related Third Parties of the other Party, except as set
forth elsewhere in this Contract.
24.2 Customer grants to Contractor and its affiliates a royalty-free,
nonexclusive, non-transferable right to use the trademarks/logos of the Customer
("Licensed Marks") on Contractor's Launch Vehicle(s) used in connection with the
Launch Service(s), and in connection with all advertising and marketing
activities occurring prior to, during and subsequent to the Launch(s), subject
to Customer's prior written approval, which approval shall not unreasonably
withheld or delayed ("Licensed Uses"). Customer represents that it is the owner
of all rights, title and interest in and to the Licensed Marks and the goodwill
associated with the Licensed Marks. Contractor's use of the Licensed Marks in
connection with the Contractor's Licensed Uses shall inure to the benefit of the
Customer and shall be of a quality commensurate with the quality of the products
and services of the Customer.
ARTICLE 25
RIGHT OF OWNERSHIP AND CUSTODY RIGHT
25.1 Customer hereby acknowledges and agrees that at no time shall it obtain
title to or ownership of or any other legal or equitable right or interest in
any part of the Launch Vehicle or in any other tangible or intangible property
or hardware of Contractor or its Related Third Parties, including, without
limitation, any patent or data rights used or furnished in providing Launch
Services under this Contract. Such property shall be considered the sole and
exclusive property of Contractor.
25.2 Contractor hereby acknowledges and agrees that at no time shall it obtain
title to or ownership of or any other legal or equitable right or interest in
any part of the Satellite or in any other tangible or intangible property or
hardware of Customer or its Related Third Parties, including, without
limitation, any patent or data rights with respect to the Satellite. Such
property shall be considered the sole and exclusive property of Customer.
ARTICLE 26
AMENDMENT
Except as may be specifically provided elsewhere in this Contract, any
amendment, modification or change to this Contract, including but not limited to
launch requirements, changes in quantity or schedule adjustments, or any waiver
of performance hereunder may only be made in writing and upon mutual agreement
of Customer and Contractor.
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ARTICLE 27
GOVERNING LAW
27.1 This Contract shall be governed by and construed in accordance with the
laws of the State of New York, United States of America, exclusive of that
jurisdiction's choice of law rules. The provisions of the United Nations
Convention for the International Sale of Goods shall not be applicable to this
Contract.
27.2 WAIVER OF JURY TRIAL. THE PARTIES WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL
BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED
TO THIS CONTRACT IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE
BROUGHT BY EITHER PARTY AGAINST THE OTHER PARTY, WHETHER WITH RESPECT TO
CONTRACT CLAIMS, TORT CLAIMS OR OTHERWISE.
27.3 Customer and Contractor are subject to civil and commercial law with
respect to their obligations hereunder, and the execution, delivery and
performance of this Contract by Customer and Contractor constitute private and
commercial acts rather than public or governmental acts. Neither Customer,
Contractor nor any of their property has any sovereign immunity from
jurisdiction of any court or from set-off or any legal process (whether through
service or notice, attachment prior to judgment, attachment in aid of execution,
execution or otherwise) under applicable law.
ARTICLE 28
WAIVER OF BREACH
The failure of either Party, at any time, to require performance of the other
Party of any provision of this Contract shall not waive the requirement for such
performance at any time thereafter.
ARTICLE 29
ASSIGNMENT
This Contract shall not be transferred, assigned in full, as security or
otherwise or delegated to any other individual, firm, institution, organization
or government agency by either Party without the prior written consent of the
other Party, except for assignments or delegations made by Customer or
Contractor to its parent company, a subsidiary of Customer or Contractor or its
parent company, or a division. Consent to assignment or delegation by either
Party shall not be unreasonably withheld. Any attempted assignment or
delegation, without such consent, shall be void and without effect. Any
permitted assignment or delegation shall not act to release a Party from its
obligations under this Contract unless the consent to assignment or delegation
from the other Party specifically provides for such release.
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ARTICLE 30
ORDER OF PRECEDENCE
In the event of any conflict or inconsistency among the various portions of this
Contract, the following order of precedence shall prevail:
Articles 1 through 34
Exhibit A - "Atlas Launch Services Statement of Work for the EchoStar
Program"
Exhibit C - "Proton Launch Services Statement of Work for the EchoStar
Program"
All other Exhibits to this Contract.
ARTICLE 31
ENTIRE AGREEMENT
This Contract constitutes the entire agreement and understanding between the
Parties. No other promises or representations, either verbal or written, with
the exception of duly executed subsequent written modifications to the Contract
shall have any force or effect in regard to the contractual obligations of the
Parties herein.
ARTICLE 32
SEVERABILITY
The invalidity, unenforceability or illegality of any provision hereto shall not
affect the validity or enforceability of the other provisions of this Contract,
which provisions shall remain in full force and effect.
ARTICLE 33
PUBLIC RELEASE OF INFORMATION
Except as required by law or regulation, no news release, public announcement,
or advertising material concerned with this Contract shall be issued by either
Party without prior written consent of the other Party. Such consent shall not
be unreasonably withheld. All releases shall be coordinated between both
Parties.
ARTICLE 34
[CONFIDENTIAL MATERIAL REDACTED]
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IN WITNESS WHEREOF, the Parties hereto have executed this Contract as of the day
and year first above written:
For Customer For Contractor
ECHOSTAR ORBITAL LOCKHEED MARTIN COMMERCIAL
CORPORATION LAUNCH SERVICES, INC.
By: By:
Name: Charlie Ergen Name: Jack Zivic
Title: President and Chief Executive Title: Manager, Business Operations
Officer
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