The portions of this Exhibit for which confidential treatment has been requested
are marked by brackets ([ ]). In addition, an asterisk (*) appears in the right
hand margin of each paragraph in which confidential information is included.
TT&C EARTH STATION AGREEMENT
between
ORION ASIA PACIFIC CORP.
and
DACOM CORP.
Dated: November 11, 1996
Table of Contents
-----------------
Page
ARTICLE 1. FUNCTIONS TO BE PERFORMED BY THE TT&C
EARTH STATION................................................................. 1
1.1. Purpose of the TT&C Earth Station ........................................... 1
1.2. Particular Functions of the TT&C Earth Station .............................. 1
1.3. Future Modification of Functions ............................................ 1
ARTICLE 2. SITE SELECTION ............................................................. 2
2.1. Site Selection .............................................................. 2
2.2. Government Approvals ........................................................ 2
2.3. Land Acquisition ............................................................ 2
2.4. Termination if Steps Not Taken .............................................. 2
ARTICLE 3. CONSTRUCTION; ANTENNA ...................................................... 2
3.1. General ..................................................................... 2
3.2. The Antenna ................................................................. 3
ARTICLE 4. TT&C EQUIPMENT ............................................................. 3
4.1. Supply of TT&C Equipment .................................................... 3
4.2. Shipments; Duties ........................................................... 3
4.3. Spares, Tooling, Supplies, etc. ............................................. 4
4.4. Title to TT&C Equipment ..................................................... 4
ARTICLE 5. TESTING .................................................................... 4
5.1. TT&C Equipment Testing and Acceptance ....................................... 4
5.2. Antenna Testing and Acceptance .............................................. 4
5.3. TT&C Earth Station Testing and Acceptance ................................... 5
5.4. Periodic Testing ............................................................ 5
ARTICLE 6. PERSONNEL .................................................................. 5
6.1. DACOM Personnel ............................................................. 5
6.2. Training .................................................................... 6
6.3. Initial Advisory Supervision and On-Site Training ........................... 6
6.4. Confidentiality Agreements .................................................. 6
ARTICLE 7. OPERATION OF THE TT&C EARTH STATION ........................................ 6
7.1. Operations .................................................................. 6
7.2. Personnel; Utilities and Supplies; Security; etc. ........................... 7
7.3. Maintenance and Repair ...................................................... 7
7.4. Destruction of the TT&C Earth Station ....................................... 8
i
ARTICLE 8. REPORTS AND DOCUMENTATION .................................................. 8
8.1. Summaries ................................................................... 8
8.2. Logs ........................................................................ 9
8.3. Regular Periodic Reports .................................................... 9
8.4. Special Reports of Anomalous Events ......................................... 9
8.5. Format of Logs and Reports .................................................. 9
ARTICLE 9. CHARGES; PAYMENTS ......................................................... 9
9.1. Charges ..................................................................... 9
9.2. Payments, Taxes and Bank Charges ........................................... 10
9.3. Time of Payment ............................................................. 10
9.4. Interest .................................................................... 11
ARTICLE 10. TERM; TERMINATION .......................................................... 11
10.1. Term ........................................................................ 11
10.2. Termination ................................................................. 11
10.3. Payment of Charges .......................................................... 11
10.4. Certain Provisions Survive Termination ...................................... 11
10.5. Option to Purchase or Lease the Site and the TT&C
Earth Station upon Termination .............................................. 12
10.6. Subsequent Modification or Expansion ........................................ 12
ARTICLE 11. FORCE MAJEURE .............................................................. 12
ARTICLE 12. GOVERNMENTAL APPROVALS ..................................................... 13
12.1. Korean Government Approvals ................................................. 13
12.2. United States Government Approvals .......................................... 13
ARTICLE 13. RISK ....................................................................... 13
13.1. Risk of Loss ................................................................ 13
13.2. Insurance ................................................................... 13
ARTICLE 14. INDEMNIFICATION; DAMAGES ................................................... 14
14.1. Indemnification ............................................................. 14
14.2. Consequential Damages ....................................................... 14
14.3. Procedure for Indemnification ............................................... 14
ARTICLE 15. CONFIDENTIALITY ............................................................ 15
15.1. Confidentiality ............................................................. 15
15.2. Confidentiality Agreements .................................................. 15
ARTICLE 16. ASSIGNMENT ................................................................. 16
16.1. Succession and Assignment ................................................... 16
16.2. Change of Control ........................................................... 16
ii
ARTICLE 17. REPRESENTATIONS AND WARRANTIES OF ORION .................................... 16
17.1. Representation and Warranties ............................................... 16
17.2. Exclusion of Warranties ..................................................... 17
ARTICLE 18. REPRESENTATIONS AND WARRANTIES OF DACOM ..................................... 17
18.1. Incorporation, Power, etc. .................................................. 17
18.2. Due Authorization of Agreement; No Conflict with
Other Instruments ........................................................... 17
18.3. Government Regulation ....................................................... 17
18.4. Exclusion of Warranties ..................................................... 17
ARTICLE 19. MISCELLANEOUS .............................................................. 18
19.1. Further Assurances .......................................................... 18
19.2. Taxes and Expenses .......................................................... 18
19.3. Press Releases and Public Announcements ..................................... 18
19.4. Notices ..................................................................... 18
19.5. No Third-Party Beneficiaries ................................................ 19
19.6. Governing Law; Arbitration .................................................. 19
19.7. Amendments and Waivers ...................................................... 19
19.8. Matters of Construction, Interpretation and the Like ........................ 20
ARTICLE 20. DEFINITIONS ................................................................ 20
EXHIBIT A FUNCTIONS TO BE PERFORMED BY THE TT&C EARTH STATION
EXHIBIT B CONSTRUCTION SPECIFICATIONS FOR THE TT&C EARTH STATION
EXHIBIT C1 ANTENNA SPECIFICATIONS
EXHIBIT C2 RF/IF REQUIREMENTS INCLUDING TEST TRANSLATOR
EXHIBIT D TT&C EQUIPMENT
EXHIBIT E TESTING
EXHIBIT F INITIAL JOB SPECIFICATIONS, NUMBER OF PERSONNEL AND QUALIFICATIONS
EXHIBIT G FORM OF CONFIDENTIALITY AGREEMENT
EXHIBIT H CONSTRUCTION CHARGES
iii
TT&C EARTH STATION AGREEMENT
----------------------------
This TT&C EARTH STATION AGREEMENT, dated as of November 11,
1996 by and between ORION ASIA PACIFIC CORP., a corporation organized and
existing under the laws of Delaware, U.S.A. ("Orion"), and DACOM CORP., a
corporation organized and existing under the laws of Korea ("DACOM"),
W I T N E S S E T H:
WHEREAS, Orion intends to establish in Korea a facility for
the transmission of tracking telemetry and command signals to the Orion 3
Satellite ("Orion 3") and under certain circumstances, to a replacement
satellite and/or a successor satellite (collectively, the "Satellite"); and
WHEREAS, DACOM wishes to establish and operate in Korea one of
the facilities for the transmission to the Satellite of tracking, telemetry and
command signals generated by Orion (the "TT&C Earth Station"), and Orion is
willing to have the backup TT&C Earth Station located in Korea and operated by
DACOM, upon the terms and conditions contained in this Agreement.
Certain terms used herein are defined in Article 20.
NOW, THEREFORE, in consideration of the foregoing, and
intending to be legally bound, the parties hereto agree as follows:
ARTICLE 1.
FUNCTIONS TO BE PERFORMED BY THE TT&C EARTH STATION
---------------------------------------------------
1.1. Purpose of the TT&C Earth Station. The TT&C Earth Station is to be
constructed and operated pursuant to this Agreement to transmit to the Satellite
and receive from the Satellite electronic signals for the tracking, telemetry
and command ("TT&C") of the Satellite, including stationkeeping, attitude
control and other satellite maintenance and switching functions as shall be
necessary to operate the Satellite and the transponders and other equipment
thereon as contemplated by the Joint Investment Agreement and the various other
agreements with users of the Satellite and of such transponders and other
equipment, and to receive signals from the Satellite relating to the Satellite's
condition and operations. The TT&C Earth Station is to be operational for such
purpose on a twenty-four hours per day, seven days per week, fifty-two weeks per
year basis from the TT&C Acceptance Date until the end of the Term of this
Agreement.
1.2. Particular Functions of the TT&C Earth Station. On the TT&C
Acceptance Date, the TT&C Earth Station and the personnel operating the TT&C
Earth Station, including CSM Operations, are to be capable of performing the
functions summarized in Exhibit A hereto, in accordance with the standards
contained therein.
1.3. Future Modification of Functions. Orion and DACOM recognize that
during the Term of this Agreement, it may become necessary or appropriate to
modify or supplement the functions summarized in Exhibit A hereto in order to
take account of changed conditions or new technology. If Orion concludes that
such a modification or supplementation has become necessary or appropriate,
Orion shall so notify DACOM at least 60 days before the date when such
modification or supplementation is to be implemented. Orion and DACOM shall
cooperate in effecting each such modification or
supplementation, upon the terms provided in this Agreement for the original
construction, equipping and operation of the TT&C Earth Station, or upon such
other terms as Orion and DACOM may agree.
ARTICLE 2.
SITE SELECTION
--------------
2.1. Site Selection. The TT&C Earth Station shall be located at such
place in ______ as shall be selected by DACOM, after consultation with Orion and
with Orion's consent, which shall not be unreasonably withheld. It is
anticipated that the site will be co-located with other similar DACOM satellite
operations. Orion's consent shall be based upon technical factors such as the
quality of the signals to be received by the Satellite from the Site, the
availability of support services at the Site (such as reliable uninterruptible
primary and backup electric power, water, heat, waste disposal, personnel,
security services and the like), the availability of adequate and reliable
communications and transportation to and from the Site, freedom from
electromagnetic interference, and similar factors. Initial selection of the Site
shall be made by DACOM as soon as practicable after execution and delivery of
this Agreement.
2.2. Governmental Approvals. DACOM shall be responsible for obtaining
all necessary governmental approvals from the government of _____, and from all
other Governmental Bodies within Korea having jurisdiction, with respect to all
aspects of the selection of the Site, the purchase or lease of real estate, the
construction and equipping of the TT&C Earth Station, and the operation of the
TT&C Earth Station, pursuant to this Agreement.
2.3. Land Acquisition. DACOM shall either purchase or lease sufficient
land for the construction and operation of the TT&C Earth Station pursuant to
this Agreement; provided, however, that the total purchase price for such land
or the aggregate lease payments for the entire term of the lease, as the case
may be, shall not exceed ________________________________________________. If
the land is purchased or leased by DACOM, DACOM shall make the land available
for uses contemplated herein and for the Term of this Agreement.
2.4. Termination if Steps Not Taken. If by June 30, 1997, (i) the Site
has not been selected by DACOM and consented to by Orion pursuant to Section
2.1, or (ii) the land for the TT&C Earth Station has not been purchased or
leased pursuant to Section 2.3, then Orion may terminate this Agreement upon
notice to DACOM given not more than 60 days after June 30, 1997.
ARTICLE 3.
CONSTRUCTION; ANTENNA
---------------------
3.1. General. As soon as practicable after full compliance with Article
2, DACOM shall cause the Site to be prepared for construction and operation of
the TT&C Earth Station (including ground preparation and construction of
foundations for the Antenna and the other TT&C Equipment), shall cause the
buildings to be located on the Site to be constructed, erected, equipped and
supplied with all necessary utilities and other services, and shall cause all
equipment (except equipment to be supplied by Orion pursuant to Article 4) to be
constructed and installed at the Site, all in accordance with the Construction
Specifications attached hereto as Exhibit B, and all at
-2-
the expense of DACOM except as provided in Section 3.2. Orion shall have the
right, upon its request to DACOM, to inspect all civil, mechanical and
electrical engineering and construction contracts, and all other contracts, with
third parties relating to such construction, erection, equipping, supply and
installation, as well as all site layout plans and detailed mechanical and
electrical drawings related to the TT&C Earth Station. If such contracts, plans
and drawings are not reasonably satisfactory to Orion, DACOM shall cause such
contracts, plans and drawings to be modified to Orion's reasonable satisfaction.
Orion shall have the right at any time with prior notification, at Orion's
expense, to have personnel designated by Orion supervise, inspect and test any
and all aspects of such construction, erection, equipping, supply and
installation related to the TT&C Earth Station.
3.2. The Antenna. In coordination with its activities pursuant to
Section 3.1, DACOM shall purchase, construct, install and erect an antenna and
related systems and equipment to the interface point in accordance with the
Antenna Specifications attached hereto as Exhibit C, and having the capabilities
specified in Exhibit C. Orion shall have the right, upon its request to DACOM,
to inspect all civil, mechanical and electrical engineering and construction
contracts, and all other contracts, with third parties relating to such
purchase, construction, installation and erection, as well as all site layout
plans and detailed mechanical and electrical drawings. If such contracts, plans
and drawings are not reasonably satisfactory to Orion, DACOM shall cause such
contracts, plans and drawings to be modified to Orion's reasonable satisfaction.
Orion shall have the right at any time, at Orion's expense, to have personnel
designated by Orion supervise, inspect and test any and all aspects of such
construction, installation and erection. Construction, installation and erection
of the Antenna shall be completed by DACOM by such date as will permit
acceptance of the Antenna to occur on or prior to April 30, 1998, or as to be
agreed at the Final Design Review, as specified in Section 5.2 of this
Agreement.
ARTICLE 4.
TT&C EQUIPMENT
--------------
4.1. Supply of TT&C Equipment. Orion shall cause to be delivered to the
Site and installed the equipment specified in Exhibit D hereto (the "TT&C
Equipment"). Exhibit D may be modified or supplemented by Orion in any respect
at any time before the TT&C Acceptance Date, if in Orion's reasonable judgment
such modification or supplementation is necessary or appropriate for the
efficient and profitable operation of the Satellite. Orion shall notify DACOM of
any such modification or supplementation. DACOM and its contractors and agents
shall cooperate with Orion in such installation, at the expense of DACOM. Orion
shall use its best efforts to cause the TT&C Equipment to be shipped and
installed at times which coordinate with DACOM's construction schedule at the
Site. The TT&C Equipment shall be assembled in the United States, unless
otherwise agreed between Orion and DACOM.
4.2. Shipments; Duties. Orion shall be responsible for shipment of the
TT&C Equipment to the Site, by such means as Orion may choose. DACOM shall, upon
Orion's request, prepay all import duties and taxes, port charges, property
taxes and similar governmental levies imposed upon Orion in connection with such
shipment and the installation and use of the TT&C Equipment at the Site. If such
import taxes, duties and similar fees are prepaid by DACOM at the request of
Orion, Orion shall reimburse DACOM in full for such prepayment within 30 days
after receipt of an invoice from DACOM detailing the amounts prepaid. DACOM
shall use reasonable efforts to
-3-
expedite customs clearance of the TT&C Equipment and to minimize import and
other duties, taxes, fees and costs imposed in connection with the shipment,
installation and use of the TT&C Equipment at the Site.
4.3. Spares, Tooling, Supplies, etc. From time to time Orion shall
cause to be delivered to the Site, and installed if appropriate, such spare and
replacement equipment, tooling and supplies for the TT&C Equipment as in Orion's
judgment is necessary or appropriate for the operation of the TT&C Equipment as
contemplated by this Agreement.
4.4. Title to TT&C Equipment. All TT&C Equipment delivered to the Site
pursuant to this Article 4, or otherwise obtained by Orion for the purposes of
this Agreement, shall be and remain the property of Orion, and DACOM shall have
no interest therein. Orion may sell, lease, mortgage, impose a Lien on or
otherwise deal with or dispose of any or all TT&C Equipment at any time or from
time to time, so long as such TT&C Equipment at the Site remains available to
perform its functions as contemplated by this Agreement. During the Term, Orion
shall have the right, at any time or from time to time, to remove any TT&C
Equipment which is no longer needed at the Site for purposes of this Agreement.
At the end of the Term, Orion shall have the right, at any time or from time to
time within 180 days after the end of the Term, to remove or cause to be removed
any or all of the TT&C Equipment then at the Site. If any of such TT&C Equipment
is not so removed within such 180-day period, such TT&C Equipment shall be
deemed to have been abandoned by Orion.
ARTICLE 5.
TESTING
-------
5.1. TT&C Equipment Testing and Acceptance. Prior to the shipment of
the TT&C Equipment to the Site, Orion shall perform or cause the equipment
manufacturers to perform testing to determine whether the TT&C Equipment is
capable of performing the functions summarized in Exhibit A hereto. Such testing
of the TT&C Equipment shall be in accordance with the Acceptance Test Plan
contained in Exhibit E hereto. Within 30 days following the conclusion of such
testing, Orion shall furnish to DACOM results of the test data in Orion's
possession relating to the TT&C Equipment in a format consistent with the
Acceptance Test Plan. At the conclusion of such testing and following the review
of such test data by DACOM and Orion, if any of the TT&C Equipment is not
capable of performing the functions summarized in Exhibit A hereto in all
material respects, Orion shall use reasonable efforts to correct the
deficiencies in the TT&C Equipment. Acceptance of the TT&C Equipment for
purposes of the performance of services under Article 7 shall occur upon
successful completion of the testing described in this Section 5.1, which shall
be acknowledged by DACOM and Orion in writing upon completion.
5.2 Antenna Testing and Acceptance. At a time prior to the TT&C
Acceptance Date which is mutually agreeable to Orion and DACOM, Orion and DACOM
shall cooperate in performing testing of the Antenna to determine whether the
Antenna is capable of performing the functions summarized in Exhibit A hereto.
Such testing of the Antenna shall be in accordance with the Acceptance Test Plan
contained in Exhibit E hereto. At the conclusion of such testing and following
the review of such test data by DACOM and Orion, if the Antenna is not capable
of performing the functions summarized in Exhibit A hereto in all material
respects, DACOM shall use reasonable efforts to correct the deficiencies in the
Antenna. Acceptance of the
-4-
Antenna for purposes of the performance of services under Article 7 shall occur
upon successful completion of the testing described in this Section 5.2, which
shall be acknowledged by DACOM and Orion in writing at the Site upon completion
(the "Antenna Acceptance Date"); provided, however, that such acceptance shall
occur no later than April 30, 1998 or as determined at the Final Design Review.
5.3. TT&C Earth Station Testing and Acceptance. Following the testing
and acceptance of the TT&C Equipment pursuant to Section 5.1 and the testing and
acceptance of the Antenna pursuant to Section 5.2, Orion and DACOM shall
cooperate in performing testing of the TT&C Earth Station to determine whether
the TT&C Earth Station is capable of commencing operations in accordance with
the Acceptance Test Plan contained in Exhibit E. Upon successful completion of
such testing, Orion shall notify DACOM that the TT&C Earth Station is ready for
operation as contemplated by Article 1. Unless DACOM objects to such notice, by
notice to Orion given within 5 days after such notice to DACOM, DACOM shall be
deemed to have accepted the TT&C Earth Station as of the date of such notice
from Orion to DACOM. If DACOM does give notice of such objection, DACOM and
Orion shall negotiate in good faith to reach agreement on remedial measures, if
any, to meet DACOM's objection, and if DACOM and Orion are unable to reach such
agreement within 90 days after such notice by DACOM, this Agreement may be
terminated by DACOM or Orion after the end of such 90-day period. The TT&C
Acceptance Date shall be the date of such notice from Orion to DACOM or, if
DACOM objects to such notice, shall be the date when DACOM and Orion reach
agreement on any remedial measures and such measures are completed as
contemplated by this Section 5.3. If the TT&C Acceptance Date does not occur on
or before September 30, 1998, either Orion or DACOM may terminate this Agreement
by notice given by the terminating party to the other party within 60 days after
September 30, 1998.
5.4. Periodic Testing. After the TT&C Acceptance Date and during the
Term, DACOM and/or Orion shall perform such tests of the TT&C Earth Station and
the TT&C Equipment as are specified in Exhibit E hereto, at the times specified
in said Exhibit E. Exhibit E may be modified or supplemented by Orion in any
respect at any time during the Term, if in Orion's reasonable judgment such
modification or supplementation is necessary or appropriate. Orion shall notify
DACOM of any such modification or supplementation.
ARTICLE 6.
PERSONNEL
---------
6.1. DACOM Personnel. All personnel necessary or appropriate for the
operation and maintenance of the TT&C Earth Station throughout the Term shall be
supplied by DACOM, at the expense of DACOM. Such personnel may be employees or
agents of DACOM or independent contractors. The number and qualifications of
such personnel shall at least meet the job descriptions and other standards set
forth in Exhibit F hereto. In addition, at all times during the Term, DACOM
shall provide sufficient on-site personnel at the TT&C Earth Station who are
fluent in English. Exhibit F may be modified or supplemented by Orion in any
respect at any time during the Term, if in Orion's reasonable judgment such
modification or supplementation is necessary or appropriate for the efficient
and profitable operation of the Satellite. Orion shall notify DACOM of any such
modification or supplementation. The technical abilities and job performance of
such personnel shall be reasonably satisfactory to Orion, and if Orion notifies
DACOM with appropriate justification that any of such
-5-
personnel are not satisfactory, DACOM shall promptly replace such personnel or
take other appropriate action satisfactory to Orion. However, none of such
personnel shall be deemed to be employees of Orion, and neither DACOM nor Orion
shall take any action pursuant to this Agreement which might result in such
personnel being treated as employees of Orion for tax, liability or any other
purposes.
6.2. Training. At the request and at the expense of DACOM, Orion will
cause up to 5 persons designated by DACOM to receive training by Orion's
qualified personnel in such matters relating to the operation of the TT&C Earth
Station as DACOM may request and Orion may deem appropriate. Each such training
session shall take place prior to the TT&C Acceptance Date during normal
business hours at the facilities in Rockville, Maryland, U.S.A., of Orion
Network Systems, Inc., or at such other facilities in the United States as Orion
may designate by notice to DACOM. The substance and duration of such training
shall be within the complete discretion of Orion, and the formal training period
for any individual shall be up to 4 weeks. Training material shall be provided
prior to commencement of training. Orion shall not impose any charge for such
training, but DACOM shall be responsible for the transportation, housing,
maintenance and other support of such persons in connection with such training,
and DACOM shall be responsible for any approvals of Governmental Bodies within
the United States required for such persons to enter and remain in the United
States for such training. In each year after the TT&C Acceptance Date, at the
request of DACOM, Orion will cause up to 2 persons designated by DACOM to
receive similar training, upon the same terms and conditions.
6.3. Initial Advisory Supervision and On-Site Training. During the
period commencing 30 days before the TT&C Acceptance Date and ending 120 days
after the TT&C Acceptance Date, Orion shall supply such numbers of qualified
technical or supervisory personnel as Orion may deem necessary or appropriate to
advise and train DACOM personnel concerning the start-up and initial operation
of the TT&C Earth Station. Such Orion personnel shall be available at the Site
at such times as DACOM or Orion deems appropriate. DACOM shall reimburse Orion
for the cost of local transportation, housing including adequate hotel room or
apartment, maintenance and other support of such personnel in connection with
such activities, and DACOM shall be responsible for any approvals by
Governmental Bodies in Korea required for such persons to enter and remain in
Korea for such activities. DACOM shall not be responsible for costs of Orion
personnel associated with in-orbit testing.
6.4. Confidentiality Agreements. Each person who receives training
pursuant to Section 6.2 shall, prior to the beginning of such training, execute
and deliver to Orion a confidentiality agreement in the form of Exhibit G
hereto.
ARTICLE 7.
OPERATION OF THE TT&C EARTH STATION
-----------------------------------
7.1. Operations. DACOM shall operate the TT&C Earth Station after the
TT&C Acceptance Date and at all times during the Term of this Agreement, on a
twenty-four hours per day, seven days per week, fifty-two weeks per year basis,
in such a manner that TT&C commands generated by Orion at other facilities and
transmitted to the TT&C Earth Station by such electronic or other means as Orion
may choose from time to time, will be transmitted to the Satellite as and when
directed by Orion, and that signals from the Satellite relating to the
Satellite's condition and operations will be received by the TT&C Earth Station
and transmitted by the TT&C Earth Station to
-6-
Orion. DACOM shall not transmit any other signals to the Satellite, except as
specifically directed by Orion. Such commands by Orion may be encrypted in whole
or in part, and DACOM shall not de-encrypt any such encrypted commands or
signals except as specifically authorized by Orion. Orion may interrupt, suspend
or cease transmitting such commands or signals to the TT&C Earth Station at any
time and for any reason deemed sufficient by Orion in Orion's sole discretion.
DACOM hereby covenants and agrees, for itself and its employees, agents and
independent contractors, to operate the TT&C Earth Station, at all times during
the Term, in a workmanlike manner and in accordance with (a) generally accepted
worldwide industry standards for the operation of such TT&C stations, and (b)
any directions given by Orion from time to time with respect to such matters.
7.2. Personnel; Utilities and Supplies; Security; etc.
(a) Personnel. DACOM shall have sufficient trained and capable
personnel at the TT&C Earth Station at all times, and/or available on call near
the TT&C Earth Station, to operate the TT&C Earth Station pursuant to Sections
6.1 and 7.1 and to carry out the other functions required of DACOM pursuant to
this Article 7. At all times, the on-site personnel provided by DACOM shall
include trained and capable personnel who are fluent in the English language. If
in Orion's judgment the number or capabilities of such personnel are inadequate
with appropriate justification, immediately upon notice from Orion to that
effect DACOM shall provide such additional trained and capable personnel at the
Site as Orion may request.
(b) Utilities and Services. DACOM shall cause the TT&C Earth
Station to be supplied with adequate light, heat, air conditioning and other
climate control, uninterruptible primary and backup electric power, fire alarms
and fire protection, spare equipment, tools, supplies and other services and
materials necessary or appropriate in the judgment of Orion for the safe and
efficient operation of the TT&C Earth Station pursuant to this Agreement.
(c) Security. DACOM shall install and maintain such security
devices at the Site of the TT&C Earth Station, and provide such guards and other
security measures, as may be necessary or appropriate in the judgment of Orion
to prevent unauthorized entry onto the Site and to maintain the confidentiality
of all technological information concerning the design, construction,
installation and operation of the TT&C Equipment, the commands and other signals
sent to and from the TT&C Earth Station and all other Confidential Information.
(d) Visitation Rights. Orion with prior notification to DACOM
may at any time, at Orion's expense, send persons designated by Orion to the
Site to observe the operation of the TT&C Earth Station, inspect and test the
TT&C Equipment, and consult with TT&C personnel at the TT&C Earth Station or
elsewhere. DACOM shall cooperate fully with such persons.
7.3. Maintenance and Repair.
(a) Regular Maintenance and Routine Repairs. DACOM shall
perform such periodic maintenance and routine repairs of the TT&C Earth Station,
including the TT&C Equipment, as may be necessary or appropriate to cause the
TT&C Earth Station and the TT&C Equipment to remain in good operating condition,
reasonable wear and tear excepted. DACOM shall follow any instructions given by
Orion with respect to such periodic maintenance and routine repairs. If all or
part of the TT&C Equipment will be maintained and/or serviced pursuant to a
contract between Orion
-7-
and the manufacturer and/or supplier of such equipment, Orion shall bear all
expenses in connection with such maintenance or service contract. DACOM shall
permit authorized representatives of such manufacturer and/or supplier to have
access to the TT&C Earth Station for the purpose of performing maintenance
and/or repairs to the TT&C Equipment.
(b) Malfunctions and Breakdowns. If either party learns that
any portion of the TT&C Earth Station, or any portion of the TT&C Equipment, has
ceased to operate, or may soon cease to operate, in the manner contemplated by
this Agreement, or that for any reason the TT&C Earth Station or the TT&C
Equipment is no longer able, or may soon be unable, to receive commands from
Orion and transmit such commands to the Satellite and receive signals from the
Satellite and transmit such signals to Orion, as contemplated by Section 7.1,
the party learning of such condition shall immediately notify the other party
thereof, by telephonic or electronic communication. In that event (except as
provided in Section 7.4) DACOM shall take such remedial action as Orion shall
specify, and shall take no other action (except emergency action, if necessary)
to remedy such condition. If such condition requires modifications to the TT&C
Equipment or replacement of any TT&C Equipment and such replacement TT&C
Equipment is not available at the Site, Orion shall use its best efforts (except
as provided in Section 7.4) to cause such replacement TT&C Equipment to be
delivered to the Site as soon as possible, and shall supply such technical
personnel to the Site as may be necessary, in Orion's judgment, to make such
modification or install such replacement TT&C Equipment.
(c) Test Equipment and Spares. Orion shall provide the
following test equipment as a minimum for general operation and maintenance
purpose:
-----------------------
-----------------------
-----------------------
-----------------------
Orion also shall provide necessary spares for _____ and ________ equipment such
as manufacturers recommended spares for normal operations. During initial
operation, manufacturers warranties will be utilized for maintenance and
calibration.
7.4. Destruction of the TT&C Earth Station. If the TT&C Earth Station
is destroyed, or is so damaged that it cannot reasonably be repaired within a
reasonable time, by accident or natural catastrophe or by any other cause
whatsoever, either Orion or DACOM may terminate this Agreement within 90 days
after such destruction or damage. Each party may carry such insurance against
such damage or destruction as such party chooses, in the sole discretion of such
party, subject, however, to the provisions of Section 13.2.
ARTICLE 8.
REPORTS AND DOCUMENTATION
-------------------------
8.1. Summaries. DACOM shall provide a summary, in English, of all
reports, procedures, including Antenna test plans and instruction manuals, and
other
-8-
appropriate documentation with respect to the Antenna construction and operation
of the TT&C facility.
8.2. Logs. DACOM shall keep daily operations logs in the English
language recording such data as Orion may request from time to time concerning
the use, maintenance, repair and replacement of TT&C Equipment and the
operations of the TT&C Earth Station. Such logs shall be available at all times
for inspection by Orion, and at the request of Orion DACOM shall make copies of
such logs or portions thereof and supply such copies to Orion.
8.3. Regular Periodic Reports. At least once a month during the Term,
DACOM shall give Orion a written report summarizing the operations of the TT&C
Earth Station during the previous month, and containing such other information
concerning the TT&C Earth Station and the TT&C Equipment as Orion may request
from time to time. Such reports shall be in the English language and in such
format, and with such accompanying data and detail, as Orion may request from
time to time.
8.4. Special Reports of Anomalous Events. If the operations of the TT&C
Earth Station are interrupted, or if any of the TT&C Equipment or the Antenna
malfunctions in any material respect or is damaged or destroyed, or if any other
unusual event occurs which Orion notifies DACOM should be the subject of a
special report, DACOM shall give Orion a written report thereof containing such
other information concerning the TT&C Earth Station and the TT&C Equipment as
Orion may request from time to time. Such reports shall be given to Orion as
soon as practicable after the event being reported, and shall be in the English
language and in such format, and with such accompanying data and detail, as
Orion may request from time to time.
8.5. Format of Logs and Reports. All logs and reports provided for by
this Article 8 may be prepared and/or kept by DACOM in either a paper or
electronic format. If such logs and reports are prepared and/or kept by DACOM
electronically, back-up copies of such logs and reports also must be prepared
and/or kept.
ARTICLE 9.
CHARGES; PAYMENTS
-----------------
9.1. Charges. DACOM and Orion shall pay the following Charges:
(a) Land Acquisition Charges. Orion shall reimburse DACOM for
the amount paid by DACOM to third parties who are not Affiliates of DACOM to
purchase or lease the land for the Site pursuant to Section 2.3, provided that
the total amount of such reimbursement shall not exceed Two-Thousand and
Five-Hundred United States Dollars ($2,500 USD). If such land is purchased,
____________ of such land acquisition Charges shall be paid by Orion to DACOM on
the Antenna Acceptance Date. The remaining ______________ of such land
acquisition charges shall be paid by Orion to DACOM on the TT&C Acceptance Date.
If the land is leased, Orion shall pay to DACOM on the Antenna Acceptance Date,
_________________ of the aggregate amount of all lease payments theretofore paid
by DACOM. During the period between the Antenna Acceptance Date and the TT&C
Acceptance Date, Orion shall pay to DACOM ________________ of the aggregate
amount of all lease payments paid by DACOM during such period within 15 days
after Orion receives appropriate invoices for such Charges. The remaining
______________ of the
-9-
aggregate lease payments paid by DACOM prior to the TT&C Acceptance Date shall
be paid by Orion to DACOM on the TT&C Acceptance Date. Orion shall reimburse
DACOM for _______________________ of all lease payments for such land made by
DACOM for periods after the TT&C Acceptance Date and through the end of the Term
of this Agreement, within 15 days after Orion receives appropriate invoices for
such Charges. If and when requested by Orion, DACOM shall provide Orion with
evidence of the payment of such amounts by DACOM.
(b) Construction Charges. Orion shall reimburse DACOM, subject
to Section 4.2, for the amount paid by DACOM to third parties who are not
Affiliates of DACOM to construct the TT&C Earth Station (which without Orion's
consent shall not exceed $50,000 USD) pursuant to Article 3, provided that (i)
no such reimbursement shall be payable with respect to portions of the TT&C
Earth Station which are not necessary for the installation of the TT&C Equipment
and the Antenna, as specified in Exhibit H hereto, and (ii) such reimbursement
shall not exceed the total amount, and the amount per component or portion of
the TT&C Earth Station, specified in Exhibit H hereto. If and when requested by
Orion, DACOM shall provide Orion with such invoices and other evidence of the
payment of such amounts by DACOM. The construction Charges payable by Orion to
DACOM pursuant to this Section 9.1(b) shall be payable within 15 days after
Orion receives appropriate invoices from DACOM for such charges, but in no event
shall such invoices be payable before the TT&C Acceptance Date.
(c) Antenna Charges. Orion shall reimburse DACOM, subject to
Section 4.2, for the actual amount paid by DACOM to third parties who are not
Affiliates of DACOM to purchase, construct and install the Antenna pursuant to
Article 3. The payment for the antenna subsystem described in Exhibit C1 shall
be a fixed amount at ____________. The payment for the RF/IF equipment and IFLs,
including shipping, installation, testing, taxes and other levies, shall be
reimbursed on the actual cost basis, but it shall not exceed
______________________________________________ ________. If and when requested
by Orion, DACOM shall provide Orion with such invoices and other evidence of the
payment of such amounts by DACOM. _______ ___________ of the Antenna Charges
payable by Orion to DACOM pursuant to this Section 9.1(c) shall be payable on
the Antenna Acceptance Date. The remaining ____ ___________ of the Antenna
Charges payable by Orion to DACOM shall be payable on the TT&C Acceptance Date.
(d) No Charge. All DACOM personnel and TT&C services shall
be provided by DACOM to Orion without charge, except as expressly set forth
herein.
9.2. Payments, Taxes and Bank Charges. All payments due to Orion or
DACOM hereunder shall be made in United States Dollars by telegraphic transfer
of immediately available funds to a bank account designated by Orion to DACOM
from time to time, in the case of payments to Orion, or by DACOM to Orion from
time to time, in the case of payments to DACOM, net of any bank fees, duties,
taxes (withholding or otherwise) or similar charges that may be imposed by such
banks or by any Governmental Bodies within Korea or the United States or any
other nation.
9.3. Time of Payment. Each party shall be deemed to have received
payment from the other party at the time the payment is received by the
designated bank of the party to receive such payment. Each party acknowledges
and agrees that any failure by it to pay any amount due to the other party
hereunder within 10 days of receipt of a notice from such other party that such
payment is due shall constitute a material breach of this Agreement.
-10-
9.4. Interest. If any amount payable by either party hereunder is not
received when due, such amount shall bear interest until paid at the rate of
eighteen percent (18%) per annum, calculated daily.
ARTICLE 10.
TERM; TERMINATION
-----------------
10.1. Term. This Agreement shall be effective as of the date hereof,
and shall terminate effective as of the expiration of the Term under the Joint
Investment Agreement, except as otherwise provided in Sections 2.4, 5.3, 7.4,
10.2(a), 10.2(b), 10.2(c) and 10.2(d).
10.2. Termination. In addition to the termination rights of the parties
specified in Sections 2.4, 5.3 and 7.4:
(a) End of Joint Investment Agreement. If and when the Term of
the Joint Investment Agreement ends, Orion or DACOM may terminate this Agreement
at any time thereafter upon at least 6 months notice to the other party, unless
this Agreement is modified or extended by the parties.
(b) Force Majeure. If operation of the TT&C Earth Station as
contemplated by this Agreement is prevented by Force Majeure for more than 15
consecutive days, either party may terminate this Agreement at any time after
the end of such 15-day period and while such Force Majeure prevents such
operation, upon at least 30 days notice to the other party, unless this
Agreement is modified or extended by the parties.
(c) Breach of Agreement. If either party commits a material
breach of any of the provisions of this Agreement and such material breach has
not been cured within thirty days after receipt by the breaching party of the
other party's notice of such breach, then the non-breaching party may terminate
this Agreement upon notice given to the breaching party at least ten and not
more than sixty days after the expiration of such thirty-day period, unless this
Agreement is modified or extended by the parties.
(d) Bankruptcy, etc. If an Act of Bankruptcy occurs with
respect to either party, then the other party may terminate this Agreement upon
notice given to the party which is subject to such Act of Bankruptcy at least
ten and not more than 180 days after such Act of Bankruptcy, unless this
Agreement is modified or extended by the parties.
10.3. Payment of Charges. In the event of any termination of this
Agreement for any reason whatsoever after the TT&C Acceptance Date, (i) each
party shall promptly pay to the other party any Charges or other amounts which
have accrued to the date of such termination and neither party shall be entitled
to any refund or credit of any Charges theretofore paid by such party to the
other party. In the event of any termination of this Agreement for any reason
whatsoever before the TT&C Acceptance Date, neither party shall be entitled to
receive any Charges after the date of such termination, whether or not such
Charges may have accrued before the date of such termination, and neither party
shall be entitled to any refund or credit for Charges previously paid.
10.4. Certain Provisions Survive Termination. The provisions of Section
4.5, Article 9, Section 10.3, this Section 10.4, Articles 13 and 14, Section
15.1 and Article 19 shall survive any termination of this Agreement and shall
not be affected thereby.
-11-
10.5. Option to Purchase or Lease the Site and the TT&C Earth Station
upon Termination. If Orion has purchased the Site and the TT&C Earth Station,
Orion shall, upon termination of this Agreement, offer to sell the Site and the
TT&C Earth Station back to DACOM at Fair Market Value (as defined below). If the
Site is leased to Orion, Orion shall, upon termination of this Agreement, permit
DACOM to acquire the remaining lease term and the TT&C Earth Station at Fair
Market Value. For purposes of this Section 10.5, "Fair Market Value" means the
fair market value of the Site and the TT&C Earth Station as determined by the
agreement of Orion and DACOM, or absent such agreement, the value determined by
the appraisal process described below. In the event Orion and DACOM are unable
to agree on the Fair Market Value of the Site and/or the TT&C Earth Station for
purposes of this Section 10.5, the issue shall be submitted to appraisal before
a panel of three appraisers. Orion and DACOM shall each have 15 days to appoint
one appraiser. The two appraisers appointed by the parties shall appoint the
third appraiser. The panel of appraisers shall determine, by unanimous or
majority decision, the Fair Market Value of the Site and/or the TT&C Earth
Station. The decision of the appraisers as to Fair Market Value shall be final.
10.6. Subsequent Modification or Expansion. If in the reasonable
judgment of Orion changed conditions, technological developments or commercial
opportunities make it desirable to modify or expand the TT&C Earth Station in
the future, Orion shall give DACOM at least 60 days notice of Orion's
determination to accomplish such modification or expansion. If such desired
modification or expansion does not involve any significant capital expenditure,
DACOM shall promptly carry out such requested modification or expansion. In all
other cases, DACOM and Orion shall proceed with such modification or expansion
upon the same basis as the original construction and equipping of the TT&C Earth
Station, with the same responsibility of the parties for payment of Charges
relating thereto.
ARTICLE 11.
FORCE MAJEURE
-------------
Any failure or delay in the performance by either party of its
obligations hereunder shall not be a breach of this Agreement if such failure or
delay is caused by any acts of God, fire, flood, weather, receive earth station
sun outage or other catastrophes, national emergencies, insurrections, riots or
wars, strikes, lockouts, work stoppages or other labor difficulties, or any law,
order, regulation, direction, action or request of any government, or of any
department, agency, commission, bureau, corporation or other instrumentality of
any government, or of any civil or military authority; provided that (i) the
party whose performance is prevented or delayed takes all reasonable steps to
avoid or remove such causes of nonperformance and continues performance whenever
and to the extent that such causes are removed or end. If Force Majeure is
claimed by either party, such party shall provide prompt notice to the other
party of both the commencement and cessation dates of such Force Majeure event.
The occurrence of a Force Majeure shall not entitle either party to any refunds
of Charges hereunder or to any other remedy whatsoever, except that both parties
shall have the termination right provided in Section 10.2(b) with the
consequences provided in Section 10.3.
-12-
ARTICLE 12.
GOVERNMENTAL APPROVALS
----------------------
12.1. Korean Government Approvals. DACOM shall be responsible for
obtaining all authorizations, licenses, permits, consents and other approvals or
governmental actions, from or by the Government of Korea and any other
Governmental Body within Korea having jurisdiction, which are required by
Section 2.2 or otherwise necessary or appropriate to enable DACOM and Orion to
carry out their respective obligations under this Agreement, to obtain necessary
financing for the transactions contemplated hereby and to transfer any funds
required hereunder. Upon DACOM's request, and to the extent feasible, Orion
shall assist DACOM in obtaining any such governmental actions. Upon the request
of Orion, DACOM shall assist Orion in obtaining the support of any such Korean
Governmental Body to assist in the coordination or consultation of the Satellite
and the frequencies on which the transponders on the Satellite will operate, all
in accordance with ITU regulations and the INTELSAT Treaty.
12.2. United States Government Approvals. Orion shall be responsible
for obtaining all authorizations, licenses, permits, consents and other
approvals or governmental actions , from or by the Government of the United
States and any other Governmental Body within the United States having
jurisdiction, which are necessary or appropriate to enable Orion and DACOM to
carry out their respective obligations under this Agreement. Upon Orion's
request, and to the extent feasible, DACOM will assist Orion in obtaining any
such governmental actions. Any consultation with INTELSAT regarding the
operation of the Satellite will be the responsibility of Orion as Orion deems
appropriate.
ARTICLE 13.
RISK
----
13.1. Risk of Loss. All risk of damage, destruction or loss of the TT&C
Earth Station shall be borne by Orion, and DACOM shall have no responsibility or
liability therefor. Notwithstanding the foregoing, Orion shall have no
liability, responsibility or obligation hereunder with respect to any damage to,
or destruction or loss of, the Satellite or any transponder or other equipment
on the Satellite resulting from any malfunction or failure of the Antenna or the
TT&C Equipment, and DACOM's rights with respect to any such malfunction or
failure shall be governed solely by the Transponder Agreement. No such damage,
destruction, loss, malfunction or failure shall entitle either DACOM or Orion to
any refunds of any Charges or any other remedies.
13.2. Insurance. Each party shall be responsible for obtaining and
maintaining such insurance as such party may choose, in such party's sole
discretion, to cover such party's insurable interests in the TT&C Earth Station
or the TT&C Equipment, and the proceeds of any such insurance shall be payable
to the party obtaining and maintaining it and not to the other party. At the
request of either party, the other party shall use reasonable efforts to assist
the requesting party in obtaining any such insurance. In addition, DACOM shall
maintain insurance coverage in the amount of Two Million United States Dollars
(2,000,000 USD), or other sums as mutually agreed, with respect to loss or
damage to the TT&C Earth Station, the Antenna or the TT&C Equipment caused by or
resulting from the negligence of DACOM's employees or agents.
-13-
ARTICLE 14.
INDEMNIFICATION; DAMAGES
------------------------
14.1. Indemnification. Each party shall indemnify and hold the other
party, and such other party's shareholders, officers, directors, agents,
employees and assigns, or any of them, whether acting through such other party
or otherwise, harmless from and against any and all claims, liabilities,
expenses, assessments, judgments and recoveries, including attorneys' fees,
incurred by any of them and occasioned by, arising out of or resulting from any
material misrepresentation, breach of warranty or covenant, or default or
nonfulfillment of any terms and conditions, on the part of such indemnifying
party under this Agreement.
14.2. Consequential Damages. In no event shall either party be liable
for any indirect, incidental or consequential damages, whether foreseeable or
not, occasioned by any cause whatsoever; except that DACOM's indemnification of
Orion pursuant to Section 14.1 shall cover damages suffered by Orion, including
loss of rentals, purchase price, income or profits, arising out of any damage to
or loss of the Satellite or any transponders or other equipment thereon or any
interruption of the Satellite's ability to transmit programming pursuant to the
various agreements between Orion and users of the Satellite or transponders or
other equipment thereon.
14.3. Procedure for Indemnification. In the event of a claim with
respect to which a party is entitled to indemnification hereunder, such party
("Indemnified Party") shall notify the other party ("Indemnifying Party") in
writing as soon as practicable, but in no event later than 15 days after receipt
of such claim; provided that a delay in giving such notice shall not preclude
the Indemnified Party from seeking indemnification hereunder if such delay has
not materially prejudiced the Indemnifying Party's ability to defend such claim.
The Indemnifying Party shall promptly defend such claim (by counsel of its own
choosing and reasonably satisfactory to the Indemnified Party) and the
Indemnified Party shall reasonably cooperate with the Indemnifying Party in the
defense of such claim, including the settlement of the matter on the basis
stipulated by the Indemnifying Party (with the Indemnifying Party being
responsible for all costs and expenses of such settlement and the reasonable
out-of-pocket expenses incurred by the Indemnified Party in cooperating with the
Indemnifying Party), subject to the limitations on settlement described in
subparagraphs (a) and (b) below. If a conflict of interest exists vis-a-vis the
interests of the Indemnifying Party and the Indemnified Party, the Indemnified
Party shall (i) be entitled to defend the claim, suit, or action or proceeding
at the expense of, for the account of and at the risk of the Indemnifying Party;
(ii) engage counsel of its own choosing reasonably acceptable to the
Indemnifying Party, and at the expense of, for the account of and at the risk of
the Indemnifying Party; and (if the actions specified in clauses (i) and (ii)
above are taken, then (iii) take reasonable steps to monitor and control the
fees and costs of counsel so chosen; and (iv) keep the Indemnifying Party
reasonably informed of the status of such defense, including without limitation
any settlement proposals by the claimant. If the Indemnifying Party, within a
reasonable time after notice of a claim, fails to defend the Indemnified Party,
the Indemnified Party shall be entitled to undertake the defense, compromise or
settlement of such claim at the expense of, for the account and at the risk of
Indemnifying Party. Upon the assumption by the Indemnifying Party of the defense
of such claim, the Indemnifying Party may settle or compromise such claim as it
sees fit; provided, however, that anything in this Section 14.3 to the contrary
notwithstanding:
-14-
(a) Consent. If there is a reasonable probability that a
settlement or compromise of a claim may materially and adversely affect the
Indemnified Party, the Indemnifying Party shall not so settle or compromise such
claim without the consent of the Indemnified Party, which consent shall not be
unreasonably withheld; and
(b) Counterclaim. If the facts giving rise to indemnification
hereunder shall involve a possible claim by the Indemnified Party against a
third party, the Indemnified Party shall have the right, at its own cost and
expense, to undertake the prosecution, compromise, and settlement of such claim.
ARTICLE 15.
CONFIDENTIALITY
---------------
15.1. Confidentiality. Each party shall treat as confidential all of
the Confidential Information, refrain from using any of the Confidential
Information except in connection with this Agreement, and deliver promptly to
the other party or destroy, at the request of the other party, all tangible
embodiments, including all copies thereof, of the Confidential Information which
are within the possession or control of such party. If either party is requested
or required (by oral question or request for information or documents in any
legal proceeding, interrogatory, subpoena, civil investigative demand or similar
process) to disclose any Confidential Information, such party shall notify the
other party promptly of such request or requirement so that the other party may
seek an appropriate protective order or waive compliance with the provisions of
this Section 15.1. If, in the absence of such a protective order or waiver,
either party is, on the advice of counsel, compelled to disclose any
Confidential Information to any tribunal or else be liable for contempt, such
party may disclose such Confidential Information to such tribunal; provided,
however, that the disclosing party shall use such party's best efforts to
obtain, at the request and expense of the other party, an order or other
assurance that confidential treatment will be accorded to such portion of the
Confidential Information required to be disclosed as the other party shall
designate. For purposes of this Section 15.1, "Confidential Information" means
any information concerning the Site or the TT&C Earth Station, the operations of
the TT&C Earth Station, the Satellite and its components, the TT&C Equipment, or
the business and affairs of DACOM or Orion or their respective Affiliates, that
is not already generally available to the public. The parties recognize that
Orion's filing of this Agreement, including the Exhibits hereto, with the United
States Securities and Exchange Commission may be required by law. Such filing
shall not be subject to or a violation of this Section 15.1.
15.2. Confidentiality Agreements. At the request of Orion to DACOM at
any time during the Term of this Agreement, DACOM shall cause any employee,
agent, consultant or independent contractor of DACOM who may have access to
Confidential Information to execute and deliver to Orion a confidentiality
agreement in substantially the form of Exhibit G hereto, with such changes
therein as Orion and DACOM may agree in light of changes in circumstances,
technology and the like. If any such employee, agent, consultant or independent
contractor refuses to execute and deliver such a confidentiality agreement,
DACOM shall take such steps as may be necessary or appropriate, including
denying such person access to the Site, so that such person will not have access
to any Confidential Information.
-15-
ARTICLE 16.
ASSIGNMENT
----------
16.1. Succession and Assignment. This Agreement shall be binding upon
and inure to the benefit of DACOM and Orion and their respective successors and
permitted assigns. Neither party may assign this Agreement or any of such
party's rights, interests or obligations hereunder without the prior approval of
the other party hereto, except as follows:
(a) Orion may (i) assign any or all of its rights and
interests hereunder to one or more of its Affiliates or to a lender or other
person providing financing to Orion or such Affiliate, and (ii) designate one or
more of its Affiliates to perform its obligations hereunder; except that in any
event Orion shall remain responsible for the performance, by itself or its
assignee, of all of its obligations hereunder; and
(b) Orion may assign and convey to any other person any or all
of its title to or rights and interests in the TT&C Equipment, or impose a Lien
on any or all of the TT&C Equipment, so long as the assignee agrees that the
TT&C Equipment shall remain at the Site and be subject to use by DACOM in
accordance with this Agreement.
16.2. Change of Control. In the event of any merger or sale of stock or
assets of DACOM resulting in a change of control of DACOM, DACOM will provide
assurance that the quality of service at the TT&C Station will be maintained.
ARTICLE 17.
REPRESENTATIONS AND WARRANTIES OF ORION
---------------------------------------
17.1. Representations and Warranties. Orion represents and warrants to
DACOM as follows:
(a) Incorporation, Power, etc. Orion is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware, U.S.A., with all necessary corporate power to own and lease its
properties and to carry on its business as and where such properties are now
owned or leased and such business is now being carried on;
(b) Due Authorization of Agreement; No Conflict With Other
Instruments. Orion has full power and authority and has taken all necessary
action to execute, deliver and consummate this Agreement and to perform all the
terms and conditions hereof to be performed by Orion. This Agreement is a valid
and binding obligation of Orion enforceable against Orion in accordance with its
terms, except as the enforceability hereof may be limited by bankruptcy,
insolvency or other laws of general application relating to or affecting the
enforcement of creditors' rights or by general principles of equity limiting the
availability of equitable remedies. The execution and delivery by Orion of this
Agreement, the consummation by Orion of the transactions which this Agreement
contemplates will be consummated by Orion, and Orion's fulfillment of and
compliance with the terms and provisions hereof applicable to Orion, do not and
will not (i) violate any law applicable to Orion, or (ii) conflict with, result
in a breach of or constitute a default under Orion's articles of incorporation
or bylaws.
-16-
17.2. Exclusion of Warranties. ORION MAKES NO REPRESENTATIONS OR
WARRANTIES OF ANY KIND OR NATURE WHATSOEVER, WHETHER EXPRESS OR IMPLIED, AS TO
THE CONDITION OF THE TT&C EQUIPMENT, THE ANTENNA OR THE TT&C EARTH STATION, OR
AS TO THEIR SUITABILITY FOR THEIR INTENDED USE. ALL SUCH WARRANTIES ARE HEREBY
EXPRESSLY DISCLAIMED. DACOM ACKNOWLEDGES THAT ORION MAKES NO WARRANTY OF ANY
KIND, AND IN PARTICULAR THAT THERE IS NO IMPLIED WARRANTY OF MERCHANTABILITY OR
FITNESS FOR ANY PARTICULAR PURPOSE ASSOCIATED WITH THE TT&C EQUIPMENT, THE
ANTENNA OR THE TT&C EARTH STATION.
ARTICLE 18.
REPRESENTATIONS AND WARRANTIES OF DACOM
---------------------------------------
DACOM represents and warrants to Orion as follows:
18.1. Incorporation, Power, etc. DACOM is a corporation duly organized,
validly existing and in good standing under the laws of Korea, with all
necessary corporate power to own and lease its properties and to carry on its
business as and where such properties are now owned or leased and such business
is now being carried on.
18.2. Due Authorization of Agreement; No Conflict With Other
Instruments. DACOM has full power and authority and has taken all necessary
action to execute, deliver and consummate this Agreement and to perform all the
terms and conditions hereof to be performed by DACOM. This Agreement is a valid
and binding obligation of DACOM enforceable against DACOM in accordance with its
terms, except as the enforceability hereof may be limited by bankruptcy,
insolvency or other laws of general application relating to or affecting the
enforcement of creditors' rights or by general principles of equity limiting the
availability of equitable remedies. The execution and delivery by DACOM of this
Agreement, the consummation by DACOM of the transactions which this Agreement
contemplates will be consummated by DACOM, and DACOM's fulfillment of and
compliance with the terms and provisions hereof applicable to DACOM, do not and
will not (i) violate any law applicable to DACOM, or (ii) conflict with, result
in a breach of or constitute a default under the instruments and documents under
which DACOM is organized and by which DACOM is governed.
18.3. Government Regulation. The terms and conditions of this
Agreement, including the payments provided for herein, are not subject to
regulation or review by or consent from any Governmental Body in Korea to which
DACOM is subject. No such Governmental Body can require the amendment,
modification or supplementation of this Agreement without the prior written
consent of Orion.
18.4. Exclusion of Warranties. DACOM MAKES NO REPRESENTATIONS OR
WARRANTIES OF ANY KIND OR NATURE WHATSOEVER, WHETHER EXPRESS OR IMPLIED, AS TO
THE CONDITION OF THE TT&C EQUIPMENT, THE ANTENNA OR THE TT&C EARTH STATION, OR
AS TO THEIR SUITABILITY FOR THEIR INTENDED USE. ALL SUCH WARRANTIES ARE HEREBY
EXPRESSLY DISCLAIMED. ORION ACKNOWLEDGES THAT DACOM MAKES NO WARRANTY OF ANY
KIND, AND IN PARTICULAR THAT THERE IS NO IMPLIED WARRANTY OF MERCHANTABILITY OR
FITNESS FOR ANY PARTICULAR PURPOSE ASSOCIATED WITH THE TT&C EQUIPMENT, THE
ANTENNA OR THE TT&C EARTH STATION.
-17-
ARTICLE 19.
MISCELLANEOUS
-------------
19.1. Further Assurances. DACOM and Orion shall take all appropriate
action and execute all documents, instruments or conveyances of any kind which
may be necessary or advisable to carry out any of the provisions hereof and to
consummate the transactions contemplated hereby
19.2. Taxes and Expenses. Each party hereto shall bear all taxes and
expenses incurred by such party in connection with the negotiation, preparation,
execution and performance of this Agreement, except as otherwise provided in
Sections 4.2, 9.1(d), 9.2 and Article 12.
19.3. Press Releases and Public Announcements. Except as otherwise
required by law or by applicable rules of any securities exchange or association
of securities dealers, neither party shall issue any press release, make any
public announcement or otherwise disclose any information for the purpose of
publication by any print, broadcast or other public media, relating to the
transactions contemplated by this Agreement, without the prior approval of the
other party.
19.4. Notices. All notices, demands, claims, requests, undertakings,
consents, opinions and other communications which may or are required to be
given hereunder or with respect hereto shall be in writing, and in the English
language, shall be given either by personal delivery or by established
international courier, charges prepaid, or by facsimile transmission, and shall
be deemed to have been given or made when personally delivered, when delivered
to the courier company, charges prepaid, and when transmitted by facsimile,
addressed to the respective parties as follows:
(a) If to Orion:
Orion Asia Pacific Corp.
2440 Research Boulevard
Rockville, Maryland 20850
Attention: Corporate Secretary
Fax: 301-258-3360
With a copy to:
Orion Asia Pacific Corp.
2440 Research Boulevard
Rockville, Maryland 20850
Attention: Vice President, Engineering
Fax: 301-258-3319
With copy to:
Reed Smith Shaw & McClay
1301 K Street, N.W.
Washington, D.C. 20005
Attention: Benjamin J. Griffin, Esq.
Fax: 202-414-9299
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or to such other address as Orion may from time to time designate by notice to
DACOM with respect to future notices, demands and other communications to Orion;
or
(b) If to DACOM:
DACOM Corp.
DACOM Building 65-228
3-GA, Hangang-Ro, Yongsan-Ku
Seoul, Korea
Attention: Youn Woo Lee
Head of Satellite Communications Business Team
Fax: 82-2-220-0761
With copy to:
Bae, Kim & Lee
Shin-A Bldg, 39-1 Seosomun-Dong
Chung-Ku, Seoul, 100-752
Korea
Attention: Suk Jin Chon, Esq.
Fax: 82-2-755-7676
or to such other address as DACOM may from time to time designate by notice to
Orion with respect to future notices, demands and other communications to DACOM.
19.5. No Third-Party Beneficiaries. This Agreement shall not confer any
rights or remedies upon any person other than the parties to this Agreement and
their respective successors and permitted assigns, and shall not create the
relationship of principal and agent, partnership or joint venture or any
fiduciary relationship between DACOM and Orion.
19.6. Governing Law; Arbitration.
(a) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, U.S.A., without
giving effect to any choice or conflict of law provision or rule (whether of the
State of New York or any other jurisdiction) that would cause the application of
the laws of any jurisdiction other than the State of New York.
(b) Arbitration. All disputes, controversies or differences
which may arise between the Parties, out of, or in relation to, or in connection
with this Agreement, or for the breach thereof, shall be finally settled by
arbitration in Vancouver, Canada, in accordance with the rules of the
International Chamber of Commerce. The award rendered by the three arbitrators
shall be final and binding upon both Parties concerned.
19.7. Amendments and Waivers. No amendment of any provision of this
Agreement, and no postponement or waiver of any such provision or of any
default, misrepresentation, or breach of warranty or covenant hereunder, whether
intentional or not, shall be valid unless such amendment, postponement or waiver
is in writing and signed by or on behalf of Orion and DACOM. No such amendment,
postponement or waiver shall be deemed to extend to any prior or subsequent
matter, whether or not similar to the subject-matter of such amendment,
postponement or waiver. No failure or delay on the part of Orion or DACOM in
exercising any right, power or privilege under
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this Agreement shall operate as a waiver thereof nor shall any single or partial
exercise of any right, power or privilege hereunder preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
19.8. Matters of Construction, Interpretation and the Like.
(a) Construction. Orion and DACOM have participated jointly in
the negotiation and drafting of this Agreement. If an ambiguity or question of
intent or interpretation arises, this Agreement shall be construed as if drafted
jointly by both parties and no presumption or burden of proof shall arise
favoring or disfavoring either party because of the authorship of any of the
provisions of this Agreement. Any reference to any law shall be deemed also to
refer to all rules, regulations, orders or decrees promulgated thereunder,
unless the context requires otherwise. The word "including" shall mean including
without limitation. Each representation, warranty and covenant contained herein
shall have independent significance. If either party breaches in any respect any
representation, warranty, covenant or other obligation contained herein or
created hereby, the fact that there exists another representation, warranty
covenant or obligation relating to the same subject matter (regardless of the
relative levels of specificity) which has not been breached shall not detract
from or mitigate the consequences of such breach. The rights and remedies
expressly specified in this Agreement are cumulative and are not exclusive of
any rights or remedies which any party would otherwise have. The Exhibits
specified in this Agreement are incorporated herein by reference and made a part
hereof. The article and section headings hereof are for convenience only and
shall not affect the meaning or interpretation of this Agreement. All
representations and warranties in this Agreement shall survive for the duration
of the Term. The English language version of this Agreement is controlling.
(b) Severability. The invalidity or unenforceability of one or
more of the provisions of this Agreement in any situation in any jurisdiction
shall not affect the validity or enforceability of any other provision hereof or
the validity or enforceability of the offending provision in any other situation
or jurisdiction.
(c) Entire Agreement; Counterparts. This Agreement (and the
other documents referred to herein) constitutes the entire agreement between the
parties and supersedes any prior understandings, agreements or representations
by or among the parties, written or oral, to the extent they relate to the
subject matter hereof. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument. It shall not be necessary
in making proof of this Agreement to produce or account for more than one such
counterpart.
ARTICLE 20.
DEFINITIONS
-----------
As used in this Agreement, unless the context otherwise requires, the
following terms shall have the following meanings:
"Act of Bankruptcy" means the institution of any proceeding by
one of the parties or by a third person seeking to have such party declared or
found to be insolvent or seeking dissolution, liquidation, reorganization or
similar relief with respect
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to such party or such party's assets, or seeking appointment of a receiver, a
trustee or other custodian for such party or such party's assets, or the
voluntary cessation or suspension of the business of such party, or any similar
relief or event, under any law relating to bankruptcy, insolvency or protection
of creditors, unless such party contests such proceeding and such proceeding is
dismissed within 30 days.
"Affiliate," with respect to either party, means any entity
that directly or indirectly through one or more intermediaries controls, is
controlled by, or is under common control with, such party.
"Agreement" means this Agreement as originally executed and
delivered or, if amended or supplemented, as so amended or supplemented.
"Antenna" means the antenna to be purchased, constructed and
installed by DACOM pursuant to Section 3.2, and for purposes of this Agreement
shall include HPA's, LNAs, switch gear, IFL's and up and down converters to the
IF Patch Panel.
"Antenna Acceptance Date" has the meaning set forth in Section
5.2.
"Charge" means the various amounts payable pursuant to Section
9.1.
"Confidential Information" has the meaning set forth in
Section 15.1.
"Construction Specifications" means the specifications
referred to in Section 3.1 and attached hereto as Exhibit B.
"CSM Operations" means the operation of communications system
monitoring equipment.
"DACOM" means DACOM Corp., a Korean corporation.
"Fair Market Value" has the meaning set forth in Section 10.5.
"Force Majeure" means one or more of the events or causes
referred to in Article 11.
"Governmental Body" means any national, state, provincial
county, city, municipal, regional or local organ of government, including all
courts, boards and agencies of any thereof.
"Joint Investment Agreement" means the Joint Investment
Agreement of even date herewith between Orion and DACOM.
"Korea" means the Republic of Korea.
"Law," whether or not capitalized, means statutes, rules,
regulations, codes, plans, injunctions, judgments, orders, decrees and rulings
of any Governmental Body.
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"Lien" means any encumbrance, including any mortgage, deed of
trust, pledge, hypothecation, assignment, statutory or other lien, security
interest or other security arrangement, conditional sale, title retention
agreement, financing lease and the filing of any financing statement or similar
instrument under the Uniform Commercial Code of any state in the United States
or comparable law of any other jurisdiction.
"Orion" means Orion Asia Pacific Corp., a Delaware corporation.
"Orion 3" has the meaning set forth in the recitals hereto.
"Permitted Liens" means (i) Liens and charges for then current
taxes, levies or assessments not then due and payable or which remain payable
without interest or penalty, (ii) easements, rights of way, title exceptions and
reservations, restrictions, zoning ordinances and other encumbrances which do
not adversely affect the use of the properties subject thereto for the purpose
contemplated by this Agreement, (iii) obligations and duties of DACOM, not
interfering with the use of the properties subject thereto for the purpose
contemplated by this Agreement, and (iv) such other Liens as Orion may approve
in Orion's sole discretion.
"Person," whether or not capitalized, means an individual,
corporation, partnership, limited liability company or partnership,
unincorporated organization, voluntary association, joint stock company, trust,
joint venture or Governmental Body.
"Satellite" means Orion 3 and any Replacement Satellite or
Successor Satellite, as those terms are defined in the Transponder Agreement.
"TT&C Earth Station" means the facilities to be constructed
and operated on the Site pursuant to this Agreement.
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"Site" means the location for the TT&C Earth Station selected
as provided in Section 2.1.
"Joint Investment Agreement" means the Joint Investment
Agreement dated as of November 11, 1996 between DACOM and Orion, as originally
executed and delivered or, if amended or supplemented, as so amended or
supplemented.
"Term" means the period of time during which this Agreement is
in effect as provided in Section 10.1.
"TT&C" has the meaning set forth in Section 1.1.
"TT&C Acceptance Date" has the meaning set forth in Section
5.3.
"TT&C Equipment" has the meaning set forth in Section 4.1.
WITNESS the due execution hereof as of the day and year first
above written.
ORION ASIA PACIFIC CORP. DACOM CORP.
By: By:
--------------------------------- --------------------------------
W. Neil Bauer Kwak, Chi-Young
Chief Executive Officer Senior Executive Vice President
Date: Date:
--------------------------------- ---------------------------
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EXHIBIT A
Confidential Treatment has been
requested for this entire exhibit.
FUNCTIONS TO BE PERFORMED
BY THE TT&C EARTH STATION
EXHIBIT B
Confidential Treatment has been
requested for this entire exhibit.
CONSTRUCTION SPECIFICATIONS
FOR THE TT&C EARTH STATION
EXHIBIT C1
Confidential Treatment has been
requested for this entire exhibit.
ANTENNA SPECIFICATIONS
EXHIBIT C2
Confidential Treatment has been
requested for this entire exhibit.
RF/IF REQUIREMENTS INCLUDING TEST TRANSLATOR
EXHIBIT D
Confidential Treatment has been
requested for this entire exhibit.
TT&C EQUIPMENT
EXHIBIT E
Confidential Treatment has been
requested for this entire exhibit.
TESTING
EXHIBIT F
Confidential Treatment has been
requested for this entire exhibit.
INITIAL JOB SPECIFICATIONS,
NUMBER OF PERSONNEL
AND QUALIFICATIONS
EXHIBIT G
FORM OF CONFIDENTIALITY AGREEMENT
NON-DISCLOSURE AGREEMENT
This Agreement is between Orion Network systems, inc., Orion satellite
Corporation and OrionNet Inc., each Delaware Corporations, hereinafter
collectively referred to as "ONS", and _________________________________,
hereinafter referred to as "Recipient". Recipient will provide certain services
to Orion Network Systems, Inc., or one of its subsidiaries, i.e., Orion
Satellite Corporation, OrionNet Inc., and Orion Asia Pacific Corp. As a result,
Recipient will receive and have access to certain information which is
confidential and proprietary to ONS. ONS desires to protect all its proprietary
and confidential information and, toward that end, Recipient hereby agrees and
represents as follows:
1. Proprietary and Confidential Information: Recipient agrees that any
information which is provided by ONS is subject to the terms of this Agreement.
Recipient agrees that all information which he receives from ONS shall be deemed
confidential, proprietary and secret whether or not any such information
received is in tangible form or is clearly marked as confidential or proprietary
or whether Recipient is expressly informed that such information is confidential
and proprietary. Information which is received orally shall also be deemed
confidential or proprietary.
2. Nondisclosure to Third Parties: The Recipient shall treat such
information received from ONS as the proprietary and confidential information of
ONS and shall not disclose said Information to any other person except as
specifically authorized in writing by ONS, and shall safeguard such Information
as he would his own proprietary and confidential information. The Recipient
shall immediately notify the disclosing party of any subpoena, court order,
administrative order, discovery request, or other event that could compel the
recipient to disclose such Information. The Recipient shall cooperate with ONS
in its efforts to protect the Information from disclosure.
3. Ownership and Use of Information: All written or oral data received by
Recipient from ONS for purposes of performing his consulting services shall be
and remain the property of ONS. Recipient shall not make copies of any tangible
data or printed information except upon specific written permission from ONS.
Any tangible data or printed information, and any copies thereof, shall be
promptly destroyed or returned immediately to ONS upon the request of ONS. The
Recipient shall not use the information received from ONS for any purpose except
to perform the specific consulting services requested.
G-1
4. Term of Agreement: The obligations under this Agreement shall continue
and survive the completion of the aforesaid consulting services and shall remain
binding for a period of five (5) years from the date of execution of this
Agreement.
5. Employee Access and Control of Information: The Recipient shall
maintain a list of the names of its employees or associates who have access to
the information and shall furnish such list to ONS upon request. Each such
employee or associate shall be deemed a Recipient and shall execute this
Non-Disclosure Agreement prior to receiving such information.
6. Unauthorized Access to Information: If the Recipient has reason to
believe any information under his control and provided to him by ONS has been
accessed by unauthorized individuals, he shall immediately report the incident
fully to ONS.
7. Exceptions: The obligations contained herein shall not apply to: (a)
Information not public which hereafter is disclosed publicly without a breach of
this Agreement; (b) Information known to the recipient prior to the time of
disclosure by the disclosing party or independently developed by employees of
the recipient without access to the Information; or (c) Information disclosed in
good faith to the recipient by a third person legally entitled to disclose it.
8. Miscellaneous: The obligations of the parties shall be binding on and
inure to the benefit of their respective heirs, successors, and assigns. This
Agreement may be amended or modified only by a subsequent agreement in writing.
This Agreement does not obligate either party to disclose any information to the
other or enter into any other agreement or arrangement. The parties' obligations
under this Agreement shall survive the termination of their association
regardless of the manner of such termination. This Agreement shall be governed
by the laws of the State of Maryland.
I agree to the foregoing terms and conditions this ________ day of
________________, 1996.
Orion Network Systems, Inc. _________________________
Recipient
__________________________ _________________________
Signature Signature
__________________________ _________________________
Print Name Print Name
__________________________ _________________________
Title Title
G-2
EXHIBIT H
Confidential Treatment has been
requested for this entire exhibit.
CONSTRUCTION CHARGES