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Pursuant to 17 CFR 240.24b-2, confidential information has been omitted in
places marked "[***]" and has been filed separately with the Securities and
Exchange Commission pursuant to a Confidential Treatment Application filed
with the Commission.
CONTRACT
between
TerreStar Networks Inc.
and
Space Systems/Loral, Inc.
for the
TerreStar Space-Based Network
The attached Contract and the information contained therein are confidential and
proprietary to TerreStar Networks Inc. and Space Systems/Loral, Inc. and shall
not be published or disclosed to any third party except as permitted by the
Terms and Conditions of this Contract.
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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TABLE OF CONTENTS
Section Page
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PREAMBLE ..................................................................1
RECITALS ..................................................................2
ARTICLE 1 - DEFINITIONS.......................................................3
ARTICLE 2 - SCOPE OF WORK....................................................15
2.1 PROVISION OF SERVICES AND MATERIALS........................15
2.2 RELATIONSHIP TO WORK UNDER SATELLITE CONTRACT..............16
ARTICLE 3 - DELIVERABLE ITEMS AND DELIVERY SCHEDULE..........................17
3.1 DELIVERABLE ITEMS..........................................17
3.2 DELIVERY...................................................17
ARTICLE 4 - PRICE 18
4.1 FIRM FIXED PRICE...........................................18
4.2 TAXES......................................................19
4.3 MOST FAVORED CUSTOMER......................................22
ARTICLE 5 - PAYMENTS.........................................................23
5.1 PAYMENT PLAN...............................................23
5.2 PAYMENT CONDITIONS.........................................23
5.3 LATE PAYMENT...............................................24
5.4 INVOICES...................................................25
5.5 PAYMENT BANK...............................................26
5.6 DISPUTED AMOUNTS...........................................26
5.7 SET OFF....................................................27
5.8 SPECIAL FINANCIAL TERMS....................................27
5.9 TIME AND MATERIAL SERVICES.................................27
ARTICLE 6 - PURCHASER-FURNISHED ITEMS........................................28
6.1 PURCHASER-FURNISHED SUPPORT................................28
6.2 COMMUNICATIONS AUTHORIZATIONS..............................28
6.3 RADIO FREQUENCY COORDINATION...............................29
6.4 LATE DELIVERY OF PURCHASER-FURNISHED ITEMS OR
SERVICES...................................................29
6.5 HNS CONTRACT ITEMS.........................................29
ARTICLE 7 - COMPLIANCE WITH U.S. LAWS AND DIRECTIVES.........................30
7.1 GENERAL....................................................30
7.2 COMPLIANCE WITH U.S. EXPORT CONTROL LAWS...................30
7.3 LICENSES AND OTHER APPROVALS...............................31
7.4 NO UNAUTHORIZED EXPORTS OR RETRANSFERS.....................32
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ARTICLE 8 - ACCESS TO WORK IN PROGRESS.......................................34
8.1 GENERAL....................................................34
8.2 WORK IN PROGRESS AT CONTRACTOR'S FACILITY..................34
8.3 WORK IN PROGRESS AT SUBCONTRACTORS' FACILITIES.............34
8.4 ON-SITE FACILITIES FOR PURCHASER'S PERSONNEL...............35
8.5 PURCHASER REPRESENTATIVES AS COMPETITORS/FOREIGN
PERSONS....................................................35
8.6 INTERFERENCE WITH OPERATIONS...............................36
8.7 FINANCING ENTITIES.........................................36
ARTICLE 9 - SBN AND SBN WORK ACCEPTANCE......................................37
9.1 SBN REQUIREMENTS ANALYSIS, IOT AND ACCEPTANCE..............37
9.2 LIMITATION ON CONTRACTOR'S LIABILITY.......................46
ARTICLE 10 - ACCEPTANCE FOR DELIVERABLE ITEMS OTHER THAN SBN AND
SBN WORK...................................................48
10.1 RESERVED...................................................48
10.2 SBAS OPERATIONAL COMPONENT.................................48
10.3 SPARE PARTS................................................50
10.4 SBAS TEST DELIVERABLES.....................................51
10.5 DELIVERABLE DATA...........................................51
10.6 TRAINING...................................................52
10.7 OTHER SERVICES.............................................53
10.8 PURCHASER'S INSPECTION AGENTS..............................53
10.9 WAIVERS AND DEVIATIONS.....................................53
10.10 INSPECTION COSTS BORNE BY PURCHASER........................54
10.11 WARRANTY OBLIGATIONS.......................................54
10.12 MILESTONE SATISFACTION TEST PROCEDURE......................54
ARTICLE 11 - TRANSFER OF TITLE AND RISK OF LOSS..............................55
11.1 DELIVERABLE ITEMS OF HARDWARE..............................55
ARTICLE 12 - SBN ACCEPTANCE PAYMENT..........................................56
12.1 ON-GROUND STORAGE..........................................56
12.2 LOSSES ATTRIBUTABLE TO PURCHASER...........................56
ARTICLE 13 - WARRANTY........................................................57
13.1 TERMS AND PERIOD OF WARRANTY...............................57
13.2 NOTICE.....................................................58
ARTICLE 14 - CHANGES.........................................................59
14.1 CHANGES REQUESTED BY PURCHASER.............................59
ARTICLE 15 - FORCE MAJEURE...................................................61
15.1 FORCE MAJEURE DEFINED......................................61
15.2 EQUITABLE ADJUSTMENTS......................................62
15.3 MAXIMUM FORCE MAJEURE......................................63
ARTICLE 16 - PURCHASER DELAY OF WORK.........................................64
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ARTICLE 17 - INTELLECTUAL PROPERTY INDEMNITY.................................65
17.1 INDEMNIFICATION............................................65
17.2 INFRINGING EQUIPMENT.......................................65
17.3 COMBINATIONS AND MODIFICATIONS.............................66
17.4 SOLE REMEDIES..............................................66
17.5 SBAS.......................................................66
ARTICLE 18 - INDEMNITY FOR PERSONAL INJURY AND PROPERTY DAMAGE...............67
18.1 CONTRACTOR'S INDEMNITY.....................................67
18.2 PURCHASER'S INDEMNITY......................................67
18.3 CONDITIONS TO INDEMNIFICATION..............................68
18.4 WAIVER OF SUBROGATION......................................69
ARTICLE 19 - TERMINATION FOR CONVENIENCE.....................................70
19.1 REIMBURSEMENT OF CONTRACTOR................................70
19.2 DISPOSITION OF WORK........................................73
ARTICLE 20 - LIQUIDATED DAMAGES FOR LATE DELIVERY............................75
20.1 SBAS OPERATIONAL COMPONENT.................................75
20.2 OFFSET.....................................................76
20.3 REMEDY.....................................................76
ARTICLE 21 - TERMINATION FOR DEFAULT AND EXCESSIVE FORCE
MAJEURE....................................................77
21.1 PURCHASER RIGHT OF TERMINATION.............................77
21.2 CONTRACTOR RIGHT OF TERMINATION............................81
21.3 EXCESSIVE FORCE MAJEURE....................................82
21.4 LIMITATION ON RIGHT TO TERMINATE...........................83
ARTICLE 22 - DISPUTE RESOLUTION..............................................84
22.1 INFORMAL DISPUTE RESOLUTION................................84
22.2 ARBITRATION................................................85
22.3 LITIGATION.................................................87
22.4 CONTINUED PERFORMANCE......................................88
ARTICLE 23 - MAJOR SUBCONTRACTS..............................................89
23.1 SELECTION OF MAJOR SUBCONTRACTORS..........................89
23.2 STEP-IN RIGHTS.............................................89
23.3 HNS SUBCONTRACT............................................89
ARTICLE 24 - CONTRACTOR INSURANCE REQUIREMENTS...............................90
24.1 INSURANCE REQUIREMENTS.....................................90
24.2 PREPARATION OF CLAIMS......................................92
24.3 CONTRACTOR SUPPORT FOR LAUNCH AND IN-ORBIT
INSURANCE POLICY...........................................92
ARTICLE 25 - PERSONNEL AND KEY PERSONNEL.....................................94
25.1 PERSONNEL QUALIFICATIONS...................................94
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25.2 KEY PERSONNEL POSITIONS....................................94
25.3 ASSIGNMENT OF KEY PERSONNEL................................94
ARTICLE 26 - LIMITATION OF LIABILITY.........................................96
26.1 LIMITATION OF LIABILITY....................................96
26.2 CAP ON LIABILITY...........................................96
26.3 EXCEPTIONS.................................................96
26.4 DUTY TO MITIGATE...........................................97
ARTICLE 27 - DISCLOSURE AND HANDLING OF PROPRIETARY INFORMATION..............98
27.1 DEFINITION OF PROPRIETARY INFORMATION......................98
27.2 TERMS FOR HANDLING AND USE OF PROPRIETARY
INFORMATION................................................99
27.3 DISCLAIMER OF REPRESENTATIONS AND WARRANTIES...............99
27.4 LEGALLY REQUIRED DISCLOSURES...............................99
27.5 RETURN OF CONFIDENTIAL INFORMATION.........................99
27.6 NO LICENSE................................................100
ARTICLE 28 - INTELLECTUAL PROPERTY RIGHTS...................................101
28.1 OWNERSHIP OF IP AND IP RIGHTS.............................101
28.2 LICENSE RIGHTS............................................102
28.3 NO LIMITATION ON DELIVERABLE ITEMS........................104
28.4 NO ADDITIONAL DELIVERABLE DATA OBLIGATION.................104
ARTICLE 29 - PUBLIC RELEASE OF INFORMATION..................................105
29.1 GENERALLY.................................................105
29.2 EXCEPTIONS................................................105
ARTICLE 30 - NOTICES........................................................106
30.1 WRITTEN NOTIFICATION......................................106
30.2 CHANGE OF ADDRESS.........................................107
ARTICLE 31 - ORDER OF PRECEDENCE............................................108
ARTICLE 32 - GENERAL........................................................109
32.1 ASSIGNMENT................................................109
32.2 BINDING EFFECT............................................110
32.3 SEVERABILITY..............................................110
32.4 WAIVER OF BREACH OF CONTRACT..............................110
32.5 AMENDMENTS................................................111
32.6 CAPTIONS..................................................111
32.7 RELATIONSHIPS OF THE PARTIES..............................111
32.8 ENTIRE AGREEMENT..........................................111
32.9 STANDARD OF CONDUCT.......................................112
32.10 CONSTRUCTION..............................................112
32.11 COUNTERPARTS..............................................112
32.12 APPLICABLE LAW............................................112
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32.13 SURVIVAL..................................................112
32.14 U.N. CONVENTION ON THE INTERNATIONAL SALES OF GOODS.......112
32.15 NO THIRD-PARTY BENEFICIARIES..............................113
32.16 CONSENTS AND APPROVALS....................................113
32.17 LENDER REQUIREMENTS.......................................113
32.18 ALIGNMENT OF INTERESTS....................................113
32.19 EFFECTIVE DATE OF SBN CONTRACT (SBN EDC)..................114
32.20 AUTHORIZATIONS............................................114
32.21 COVENANT OF GOOD FAITH....................................114
ARTICLE 33 - OPTIONS........................................................115
33.1 SBN PRICE REDUCTION OPTION................................115
33.2 SBAS- RELATED OPTIONS.....................................121
ARTICLE 34 - SECURITY INTEREST..............................................127
34.1 GRANT OF SECURITY INTEREST................................127
34.2 RIGHT TO MAKE FILINGS.....................................127
34.3 CORPORATE RECORDS.........................................128
34.4 PERFECTED SECURITY INTEREST...............................128
34.5 JUNIOR LIENS..............................................128
34.6 PERIODIC INVENTORY........................................129
34.7 REMEDIES..................................................129
34.8 DEFICIENCIES..............................................129
34.9 APPLICATION OF PROCEEDS...................................130
34.10 LIMITED POWER OF ATTORNEY.................................130
34.11 CONTRACTOR COOPERATION....................................130
34.12 INTELLECTUAL PROPERTY RIGHTS..............................130
34.13 SURVIVAL OF SECURITY INTEREST.............................131
ATTACHMENT A FORM OF INVOICE................................................133
ANNEX I TO ATTACHMENT A FORM OF CONTRACTOR CERTIFICATE......................134
SCHEDULE I TO ANNEX I TO ATTACHMENT A.......................................136
ATTACHMENT B................................................................137
KEY PERSONNEL......................................................137
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PREAMBLE
This Contract is executed as of January 25, 2007 (the "Effective Date"), by and
between TerreStar Networks Inc., a corporation organized and existing under the
laws of the state of Delaware, having an office and place of business at 12010
Sunset Hills Road, Reston, Virginia 20190 (hereinafter referred to as
"Purchaser") and Space Systems/Loral, Inc., a corporation organized and existing
under the laws of the state of Delaware, having an office and place of business
at 3825 Fabian Way, Palo Alto, California 94303-4604 (hereinafter referred to as
"Contractor", and Purchaser and Contractor are hereinafter referred to
collectively as the "Parties" or individually as a "Party") regarding the
TerreStar Space-Based Network program.
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RECITALS
WHEREAS, Purchaser and Contractor are parties to a Second Amended and
Restated Contract for the development and purchase of two Satellites, as amended
(the "Satellite Contract");
WHEREAS, Purchaser is a party to a contract with Hughes Network Systems
(HNS) for Purchaser to procure one (1) Satellite Beam Access Subsystem (the
"SBAS" as further defined below) and Purchaser desires Contractor to serve as
its prime contractor for such SBAS work;
WHEREAS, Purchaser also desires to procure one (1) Space- Based Network
(the "SBN" as further defined below), Training services, SBN Work, SBAS
Deliverable Services and other items and services to the extent and subject to
the terms and conditions set forth herein;
WHEREAS, Contractor is willing to furnish such SBAS, SBN, Training
services, SBN Work, SBAS Deliverable Services and other items and services to
the extent of and subject to the terms and conditions set forth herein, in
consideration of the price and other valid consideration;
WHEREAS, the Parties desire to enter into this TerreStar Space-Based
Network Contract for such goods and services;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein and intending to be legally bound, the Parties agree as
follows:
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ARTICLE 1 - DEFINITIONS
Capitalized terms used and not otherwise defined herein shall have the following
meanings:
1.1 "Acceptance" (i) with respect to the SBN and SBN Work shall be as
provided in Article 9, and (ii) with respect to any other Deliverable
Item shall be as provided in Article 10, except that, for the SBAS
Operational Component, Acceptance shall be determined according to
Preliminary Acceptance (as defined below) and as provided in Article
10.2.1 and Final Acceptance as provided in Article 10.2.5.
1.2 "Adjusted SBN Acceptance Payment" means the amount of the SBN
Acceptance Payment to which Contractor is entitled in the event of a
Partially Degraded SBN in accordance with Article 9.1.3.B, as
calculated in accordance with the formula set forth in Article 9.1.4.
1.3 "Affiliate" means, with respect to an entity, any other entity
Controlling or Controlled by or under common Control with such entity.
Notwithstanding the foregoing and for purposes of this Contract, the
Parties agree that TerreStar Networks (Canada) Inc., a corporation
incorporated under the Business Corporations Act (Ontario), shall be
deemed to be an Affiliate of Purchaser.
1.4 "Approved SBAS Acceptance Plan" has the meaning set forth in Article
10.2.1.
1.5 "Article" means any article or numbered paragraph thereof in the
Contract terms and conditions.
1.6 "Associated Ground Equipment" means, collectively, the following SBAS
Deliverable Items: Calibration Earth Stations (CES) and terrestrial
infrastructures and transmission facilities (TTF) described in Exhibits
A-1, SBAS Statement of Work; B-1, SBAS Performance Specification; and
D-1, SBAS Program Test Plan.
1.7 "ATC IP" means any Intellectual Property covering a system, method,
base station and/or wireless terminal (including any associated end
user device) that uses or reuses a satellite band frequency for
terrestrial (aeronautical, maritime or land-based) wireless
communications, but excluding any satellite-related technology.
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1.8 "Attachment(s)" means any and all attachment(s) that are attached
hereto and incorporated herein (or are attached to any Exhibit and
incorporated therein), as amended from time to time in accordance with
the terms hereof.
1.9 "Background Intellectual Property" means Intellectual Property first
made, developed, or created prior to the negotiation or performance of
this Contract or otherwise first made, developed or created other than
in performance of or pursuant to this Contract, and necessary to the
use of any Deliverable Item.
1.10 "Bankruptcy Code" means title 11 of the United States Code, as amended
from time to time.
1.11 "Business Day" means any day other than the following: a Saturday,
Sunday, and any other day on which national banks are authorized to be
closed in New York City, New York.
1.12 "Certificate of Completion" means that certificate to be issued by
Contractor upon successful completion of a Milestone.
1.13 "Collateral" has the meaning set forth in Article 34.1.
1.14 "Competing Satellite System" means a commercial mobile satellite
operator.
1.15 "Component(s)" means every unit, system and subsystem and all other
hardware and software required to be provided by Contractor hereunder.
1.16 "Conforming Change Order" has the meaning set forth in Article 9.1.1 A.
1.17 "Conforming SBN" means the SBN meeting all of the requirements of the
Definitive SBN Performance Specification, as may be amended from time
to time in accordance with the terms hereof, including by way of
Purchaser approved deviations and/or waivers (which shall be addressed
as set forth in Article 10.9).
1.18 "Contract" means the terms and conditions ("Preamble", "Recitals" and
the Articles) of this executed Contract, its Exhibits and its
Attachment(s) as set forth in Articles 2.1 and 31, as amended from time
to time in accordance with the terms hereof.
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1.19 "Contractor" has the meaning set forth in the "Preamble" of this
Contract and any successor or assignee permitted hereunder.
1.20 "Control" and its derivatives mean, with respect to an entity, the
legal, beneficial, or equitable ownership, directly or indirectly, of
fifty percent (50%) or more of the capital stock (or other ownership
interest if not a corporation) of such entity ordinarily having voting
rights or the power to direct the management policies of such entity,
whether through the ownership of voting stock, by contract, or
otherwise.
1.21 "Definitive SBN Performance Specification" means the Performance
Specification for the SBN as determined in accordance with Article
9.1.1.B.
1.22 "Degraded SBN Performance Specification" has the meaning set forth in
Article 9.1.1 A.
1.23 "Deliverable Data" means the data and documentation required to be
delivered to Purchaser as specified in each Exhibit A, Statement of
Work.
1.24 "Deliverable Item" means any of the items or services listed in Article
3.1, as may be amended from time to time in accordance with the terms
hereof or any optional items or services elected by Purchaser, and,
collectively, the "Deliverable Items".
1.25 "Delivery" has the meaning set forth it in Article 3.2.
1.26 "Dispute(s)" has the meaning set forth in Article 22.
1.27 "Effective Date of SBN Contract" or "SBN EDC" means January 25, 2007.
1.28 "Exhibit(s)" means the exhibit(s) identified in Article 2.1 and
attached hereto and incorporated herein.
1.29 "Final Acceptance" with respect to the SBAS Operational Component shall
be as provided in Article 10.2.5.
1.30 "FCC" means the Federal Communications Commission or any successor
agency or governmental authority.
1.31 "Final SBN IOT" has the meaning set forth in Article 9.1.3 A.
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1.32 "Financing Agreement(s)" means any and all documents and agreements
evidencing and/or securing monies provided on a full or partial debt
basis by any Financing Entity to Purchaser to fund the design,
development, construction, procurement, maintenance, or operation of
all or any material part of Purchaser's Satellite program.
1.33 "Financing Entity" means any entity (other than Contractor, or parties
related to Contractor, or competitors of Contractor), e.g., commercial
bank, merchant bank, investment bank, commercial finance organization,
corporation, or partnership, which has been specifically identified in
a written notification to Contractor providing money on a full or
partial debt basis to Purchaser to fund the design, development,
construction, procurement, maintenance, or operation of all or any
material part of Purchaser's Satellite program.
1.34 "Firm Fixed Price" means the firm fixed price applicable to the
Deliverable Items, as set forth in Article 4.1. References to "the Firm
Fixed Price" mean SBAS Firm Fixed Price, or SBN and SBN Work Firm Fixed
Price, as applicable given the context.
1.35 "Force Majeure" has the meaning set forth in Article 15.
1.36 "Foreground Intellectual Property" means Intellectual Property first
made, developed or created in performance of this Contract and that is
incorporated into or employed in, or required for the use of, any
Deliverable Item.
1.37 "Fourth Spacecraft" has the meaning set forth in Article 33.1.3.A(i).
1.38 "Fully Degraded SBN" means that the SBN does not meet any or all of the
SBN Key Performance Requirements specified in the Definitive SBN
Performance Specification (which Definitive SBN Performance
Specification shall be determined in accordance with Article 9.1.1B),
provided that the SBN shall be deemed fully degraded only if
performance degradation (derived in accordance with Article 9.1.4A)
against the SBN Key Performance Requirements is greater than one or
more of the following limits:
o 95% PSA S-band Aggregate EIRP Degradation > [***]
o 95 % PSA S-band G/T Degradation > [***]
o S-band C/I Total Average Aggregate Degradation > [***]
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o SBN Service Availability Degradation > [***]
1.39 "Ground Station" means, collectively, the following SBAS Deliverable
Items: One (1) Feeder Link Earth Station (FES), one (1) Ground Based
Beam Former (GBBF), and one (1) Control and Management System (CMS).
1.40 "HNS" means Hughes Network Services, LLC.
1.41 "HNS Contract" means the contract entered into between HNS and
TerreStar for the SBAS, dated December 1, 2005.
1.42 "HNS Foreground IP" means any Intellectual Property first made,
developed or created by HNS (or any of its sub-tier subcontractors) in
the performance of the HNS Subcontract or the HNS Contract that is
incorporated into or employed in, or required for the use of the SBAS
Operational Component or any Component thereof or the SBAS Deliverable
Services.
1.43 "HNS Subcontract" means that subcontract between Contractor and HNS
dated January 19, 2007, as may be amended subject to Article 23.3.
1.44 "HNS Subcontracted Work" means the Work that Contractor subcontracts to
HNS under the HNS Subcontract that is directly related to the SBAS for
TerreStar 1. The HNS Subcontracted Work does not include the SBN
Integration Support performed pursuant to Exhibit E of the HNS
Subcontract (existing as of the SBN EDC or as amended) or other Work
subcontracted to HNS in connection with the SBN Work.
1.45 "In-Orbit Testing" or "IOT" means the testing of a Satellite or the SBN
in-orbit in accordance with the Satellite Contract, or Exhibit D-2, SBN
Program Test Plan, as applicable.
1.46 "Intellectual Property" means all designs, methods, concepts, layouts,
software, inventions (whether or not patented or patentable),
processes, technical data and documentation, technical information and
drawings, and similar matter in which an Intellectual Property Right
may subsist.
1.47 "Intellectual Property Claim" has the meaning set forth in Article 17.
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1.48 "Intellectual Property Right(s)" means all common law and statutory
proprietary rights, including patent, patent application, patent
registration, copyright, trademark, service mark, trade secret, mask
work rights, data rights and similar rights existing from time to time
under the intellectual property laws of the United States, any state or
foreign jurisdiction, or international treaty regime.
1.49 "London Inter-Bank Offer Rate" or "LIBOR" means the rate per annum
shown, on the third (3rd) London business day preceding the day of
commencement of an interest calculation period, on page 3750 of the Dow
Jones & Company Telerate screen or any successor page as the composite
offered rate for London interbank deposits in an amount approximately
equal to the amount on which the interest is to be applied for a
three-month period (the "Rate Base"), as shown under the heading "USD"
as of 11:00 a.m. (London Time); provided that in the event no such rate
is shown, LIBOR shall be the rate per annum (rounded to the nearest
1/100th of one percent) based on the rates at which U.S. dollar
deposits approximately equal in principal amount to the Rate Base and
for a three-month period are displayed on page "LIBO" of the Reuters
Monitor Money Rates Service or such other page as may replace the LIBO
page on that service for the purpose of displaying London interbank
offered rates of major banks as of 11:00 a.m. (London time) (it being
understood that if at least two such rates appear on such page, the
rate will be the arithmetic mean of such displayed rates); provided
that in the event fewer than two such rates are displayed, or if no
such rate is relevant, LIBOR shall be the rate per annum equal to the
rate offered by Credit Suisse, New York Branch, at approximately 11:00
a.m. (London Time) to prime banks in the London interbank market on
deposits in U.S. dollars in an amount approximately equal in principal
amount to the aggregate principal balance of the Rate Base for a
three-month period.
1.50 "Major Subcontract" means a subcontract related to the performance of
this Contract and valued at Two Million Five Hundred Thousand U.S.
dollars (US$2,500,000) or more.
1.51 "Matching Terms" has the meaning set forth in Article 33.1.4.
1.52 "Milestone" means a portion of the Work upon completion of which a
payment is to be made in accordance with, or that is otherwise
identified as a milestone in: (i) Exhibit E-1 SBAS Program Payment
Plan; or (ii) Exhibit E-2, SBN Program Payment Plan and Termination
Liability Amount.
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1.53 "MRP System" means Contractor's then current internal material
requirements processing system used by Contractor in connection with
the performance of satellite construction contracts for its customers
generally.
1.54 "Notice of Election" has the meaning set forth in Article 18.3.1.
1.55 "NSP" means not separately priced and included in the Firm Fixed Price.
1.56 "Option" has the meaning set forth in Article 33.2.
1.57 "Partially Degraded SBN" means that the SBN does not meet any or all of
the SBN Key Performance Requirements specified in the Definitive SBN
Performance Specification (which Definitive SBN Performance
Specification shall be determined in accordance with Article 9.1.1 B),
provided that the SBN shall be deemed partially degraded only if
performance degradation (derived in accordance with Article 9.1.4 A)
against the SBN Key Performance Requirements is equal to or less than
one or more of the following limits:
o 0 dB < 95% PSA S-band Aggregate EIRP Degradation < / = [***].
o 0 dB < 95 % PSA S-band G/T Degradation < / = [***]
o 0 dB < S-band C/I Total Average Aggregate Degradation < / = [***].
o 0% < SBN Service Availability Degradation < / = [***]
1.58 "Party" or "Parties" means Purchaser, Contractor or both, as the
context requires.
1.59 "Payment Plan" means the payment plan for the applicable Deliverable
Item, as set forth in Exhibit E-1, SBAS Program Payment Plan, with
respect to the SBAS and Exhibit E-2, SBN Program Payment Plan and
Termination Liability Amounts with respect to the SBN and SBN Work, as
each such Exhibit may be amended from time to time in accordance with
the terms hereof.
1.60 "Performance Specification" means the applicable performance
specification for a SBN, SBAS, or other Deliverable Item, as
appropriate, in the context of the applicable clause, as such
specification may be amended from time to time in accordance with the
terms hereof.
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1.61 "Permitted Debt" has the meaning set forth in Article 34.5.
1.62 "PMO" means the Purchaser's program management office to be designated
by Purchaser.
1.63 "Preliminary Acceptance" means, with respect to the SBAS Operational
Component, successful completion of factory acceptance testing, site
acceptance testing and pre-Launch systems acceptance testing, all in
accordance with Exhibit A-1, SBAS Statement of Work and, as evidenced
by a Certificate of Completion signed by Purchaser for each such test.
1.64 "Proprietary Information" has the meaning set forth in Article 27.
1.65 "Purchaser" has the meaning set forth in the "Preamble" and any
successor or assignee permitted hereunder.
1.66 "Purchaser Delay" has the meaning set forth in Article 16.
1.67 "Qualified Manufacturer" has the meaning set forth in Article 33.1.2 A
(ii).
1.68 "Raw Materials, Work-in-Process and Finished Goods" means (i) all
Deliverable Items (including the SBN and SBN Work, and SBAS); (ii) all
Components; and (iii) all rights in Intellectual Property, Proprietary
Information, and other data and information that are to be and/or
actually are delivered to Purchaser under this Contract. The foregoing
shall constitute "Raw Materials, Work-in-Process and Finished Goods" as
the same shall be in the process of performance, manufacture, assembly,
integration, testing, delivery or completion at any given point in
time, whether raw materials, work in process or finished goods, whether
now owned or after-acquired and whether now existing or hereafter
coming into existence; but, in each case, only to the extent identified
to this Contract, which shall be deemed to occur only when such goods
have been installed on the SBAS, or designated for the SBAS under the
MRP System.
1.69 "Requirements Analysis" means the analysis to be performed by
Contractor pursuant to Article 2.1.1.2 of Exhibit A-2, SBN SOW.
1.70 "Satellite" means any communications satellite that is to be
manufactured by Contractor and to be delivered to Purchaser pursuant to
the Satellite Contract. References to "the Satellite" mean TerreStar 1
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or TerreStar 2 (as defined in the Satellite Contract), as applicable
given the context.
1.71 "Satellite Contract" means the Second Amended and Restated Contract
entered into between the Parties, effective September 8, 2005, as
amended.
1.72 "SBAS" means the Satellite Beam Access Subsystem comprised of the
Deliverable Items identified in Table 4-1 of Exhibit A-1, SBAS
Statement of Work.
1.73 "SBAS Deliverable Services" means the services listed in Section 4.4 of
Exhibit A-1, SBAS Statement of Work.
1.74 "SBAS Performance Specification" means the SBAS performance
specification for such SBAS attached as Exhibit B-1 hereto, as may be
amended from time to time in accordance with the terms hereof.
1.75 "SBAS Program Test Plan" means the SBAS program test plan attached as
Exhibit D-1 hereto, as may be amended from time to time in accordance
with the terms hereof.
1.76 "SBAS Operational Component" means, collectively, the following SBAS
Deliverable Items: Two (2) Ground Stations, one (1) lot of Associated
Ground Equipment and associated system software.
1.77 "SBAS Test Deliverables" means the following SBAS Deliverable Items:
Satellite Simulator and S-BSS Emulator.
1.78 "SBN" means the space-based network composed of the integrated
Satellite (TerreStar 1), which Satellite is to be delivered under the
Satellite Contract, and the SBAS Operational Component that is to be
delivered by Contractor to Purchaser pursuant to this Contract.
1.79 "SBN Acceptance Payment" means the payment in the amount of [***] U.S.
dollars (US$[***]), adjusted in accordance with Article 9.1.4 and
Article 33.1, as applicable.
1.80 "SBN Integration Support" means that portion of the SBN Work
subcontracted to HNS as set forth in Exhibit E to the HNS Subcontract.
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1.81 "SBN IOT" means in-orbit Acceptance testing of the SBN in accordance
with Exhibit D-2, SBN Program Test Plan, and Article 9.1.
1.82 "SBN Key Performance Requirements" means selected performance
parameters from the Definitive SBN Performance Specification,
identified to represent the level of performance for the SBN in terms
of user experience, as follows:
o 95% PSA S-Band Aggregate EIRP at + 6 degrees inclination
o 95 % PSA S-Band G/T at + 6 degrees inclination
o S-Band C/I Total Average Aggregate at 0 degrees inclination
o SBN Service Availability
1.83 "SBN Price Reduction Amount" means up to [***] U. S. dollars
(US$[***]), as such amount may be reduced in accordance with Article
33.1.
1.84 "SBN Price Reduction Option" as the meaning set forth in Article
33.1.1.
1.85 "SBN Program Test Plan" means the SBN program test plan attached as
Exhibit D-2 hereto, as may be amended from time to time in accordance
with the terms hereof.
1.86 "SBN Service Availability" has the meaning set forth in Section 3.5.2
of Exhibit B-2, SBN Performance Specification.
1.87 "SBN Work" means the Work specified in Exhibit A-2.
1.88 "Secured Obligations" means, collectively, all monetary obligations of
Contractor to Purchaser under this Contract (including without
limitation Contractor's obligations to (i) pay liquidated damages under
Article 20 hereof, (ii) indemnify Purchaser under Articles 4.2 (solely
with respect to Contractor's indemnification obligations), 19, and 20
hereof; and (iii) make termination payments under Article 19 and
Article 21) and all damages payable to Purchaser and its Affiliates by
Contractor arising out of or relating to this Contract and all
reasonable costs and expenses incurred by Purchaser to recover such
damages (including reasonable attorney fees).
1.89 "Security Interest" has the meaning set forth in Article 34.1.
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1.90 "Spare Part" means any spare part to be delivered in accordance with
Section 4.3 of Exhibit A-1, SBAS Statement of Work.
1.91 "Statement(s) of Work" or "SOW" means the statements of work attached
as Exhibits A-1 and A-2 hereto, as may be amended from time to time in
accordance with the terms hereof.
1.92 "Taxes" means any tax, duty or similar liability imposed by any
governmental agency (including interest, fines, penalties, or additions
attributable or imposed on or with respect to any such taxes, duties
and similar liabilities).
1.93 "Termination Default" has the meaning set forth in Article 34.7.
1.94 "TerreStar 1" or "TS-1" means the first Satellite to be provided under
the Satellite Contract.
1.95 "TerreStar 2" or "TS-2" means the second Satellite to be provided under
the Satellite Contract.
1.96 "Third Spacecraft" has the meaning set forth in Article 33.1.2.A(i).
1.97 "Total Loss" means with respect to the Satellite after Intentional
Ignition: (i) the complete loss, destruction or operational failure of
such Satellite, or (ii) a constructive total loss as defined in the
Launch and In-Orbit Insurance Policy, if any, for such Satellite (as
such capitalized terms are defined in the Satellite Contract).
1.98 "Training" means the training specified in Exhibit A-1, SBAS Statement
of Work, and Exhibit A-2, SBN Statement of Work, to be provided by
Contractor hereunder.
1.99 "UCC" means the Uniform Commercial Code of the State of New York or,
with respect to the perfection and the effect of perfection or
non-perfection of the Security Interest in the Collateral as provided
in Article 34.4, the state of Delaware, in either case as in effect
from time to time.
1.100 "Work" means all design, development, construction, manufacturing,
labor, and services, including tests to be performed, and any and all
Deliverable Items, including the SBN and SBN Work, SBAS (including SBAS
Deliverable Services), Training, and equipment, materials, articles,
matters, services, and things to be furnished and rights to be
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transferred to Purchaser under this Contract, or any subcontract
entered into hereunder by Contractor.
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ARTICLE 2 - SCOPE OF WORK
2.1 PROVISION OF SERVICES AND MATERIALS
Contractor shall provide the necessary qualified personnel, material, services,
facilities and know-how to: design, manufacture, test, and deliver for
Purchaser's Acceptance one (1) SBAS, one (1) SBN, together with all other
Deliverable Items referred to in Article 3.1 (and any options if exercised by
Purchaser), all in accordance with this Contract, including the following
Exhibits (as applicable), and Attachments (as applicable) which are attached
hereto (or incorporated by reference) and made a part hereof:
2.1.1 Exhibit A, Statements of Work
A-1 SBAS Statement of Work (SOW), Revision 3.1 dated December 1,
2006
A-2 Statement of Work for TerreStar S-Band Space-Based Network and
Interference Analysis Support ("SBN Statement of Work"),
Document No. SS/L-E338830, Revision C dated December 1, 2006
2.1.2 Exhibit B, Performance Specifications
B-1 Satellite-Beam-Access Subsystem Functional and Performance
Requirements Specifications ("SBAS Performance
Specification"), Revision 1.2 dated December 1, 2006
B-2 TerreStar S-Band Space-Based Network Technical Performance and
Design Requirements ("SBN Performance Specification"),
Document No. SS/L-338831, Revision B-8 dated December 1, 2006
2.1.3 Exhibit C, Reserved,
2.1.4 Exhibit D, Test Plans
D-1 TerreStar Satellite-Beam-Access Subsystem Program Test Plan,
Revision 1.0 dated July 17, 2006
D-2 TerreStar S-Band Space-Based Network Test Plan (VCRM),
Document No. SS/L-338832, Revision A-3 dated December 1, 2006
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2.1.5 Exhibit E, composed of Exhibit E-1, TerreStar Satellite-Beam-Access
Subsystem - SBAS Payment Plan, Rev. 1.4 dated December 1, 2006 and
Exhibit E-2, SBN Program Payment Plan and Termination Liability Amount,
dated December 14, 2006.
2.1.6 Attachments
A. Form of Invoice (including the Annex 1 thereto, "Form of
Contractor Certificate" and "Schedule 1 to Annex I to
Attachment A")
B. Key Personnel
2.2 RELATIONSHIP TO WORK UNDER SATELLITE CONTRACT
The Parties hereto are also parties to the Satellite Contract. In both
capacities, the Parties shall use reasonable commercial efforts to coordinate
work under both contracts to the extent required for performance of each,
including but not limited to providing necessary access to the Satellite and
required data; provided, however, neither Party shall be required to take any
action under this provision that constitutes or could reasonably be expected to
lead to a breach or default of other obligations under either contract.
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ARTICLE 3 - DELIVERABLE ITEMS AND DELIVERY SCHEDULE
3.1 DELIVERABLE ITEMS
Subject to the other terms and conditions of this Contract, the items to be
delivered under this Contract are specified in the table below and Contractor
shall deliver such items on or before the corresponding Delivery dates and at
locations specified in the table below. The Delivery dates and locations for
those items subject to an option under this Contract are described in the
particular Articles that set forth such options:
- ----------------------------------------------------------------------------------------------------
Item Description Delivery Date Delivery Location
- ----------------------------------------------------------------------------------------------------
1. SBAS (not including [***] (SBAS Operational Component) Per SOW,
item 3 and associated For Test Deliverables and Spare Parts: Exhibit A-1
parts of items 4 and Per SOW, Exhibit A-1
5)
- ----------------------------------------------------------------------------------------------------
2. SBN and SBN Work Per SOW, Exhibit A-2 - [***] Per SOW,
Exhibit A-2
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3. SBAS Deliverable Per SOW, Exhibit A-1 Per SOW,
Exhibit A-1
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4. Deliverable Data Per SOW Exhibit A-1 (for SBAS PMO
Deliverable Data) and Exhibit A-2 (for
SBN Deliverable Data)
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5. Training Per SOW, Exhibit A-1 (for SBAS Per SOW,
Training) and Exhibit A-2 (for SBN Exhibits A-1
Training) nd A-2
- ----------------------------------------------------------------------------------------------------
3.2 DELIVERY
Delivery of each Deliverable Item other than the SBAS Operational Component and
SBN and SBN Work, shall occur upon Acceptance of such item in accordance with
Article 10. Delivery of the SBN and SBN Work shall occur upon Acceptance of the
SBN and SBN Work pursuant to Article 9.1.3. Delivery of the SBAS Operational
Component shall occur upon Preliminary Acceptance of the SBAS Operational
Component, as evidenced by the applicable Certificates of Completion signed by
Purchaser pursuant to Article 10.2.2.
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ARTICLE 4 - PRICE
4.1 FIRM FIXED PRICE
4.1.1 FFP. The Firm Fixed Price for each Deliverable Item is set forth in the
table below.
------------------------------------------------------------------------------
Item Description TerreStar 1 Program Amount
------------------------------------------------------------------------------
1. SBAS US$38,139,834
------------------------------------------------------------------------------
2. SBN and SBN Work US$22,500,000*
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3. SBAS Deliverable Services NSP
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4. Deliverable Data NSP
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5. Training NSP
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TOTAL Firm Fixed Price US$60,639,834*
------------------------------------------------------------------------------
*Subject to a reduction of up to $[***] if the SBN Price
Reduction Option is exercised pursuant to Article 33.1.
Payments already made to HNS by Purchaser under the HNS Subcontract
shall be deemed as payments made hereunder and shall be credited
against the Firm Fixed Price hereof.
4.1.2 Elements of the Item FFP's.
A. For the SBAS. Subject to Article 4.2 hereof, the price to be
paid by Purchaser to Contractor for the Deliverable Items 1
and 3 and SBAS-related portions of Deliverable Items 4 and 5
set forth in Article 3.1 hereof, within the scope of Work as
detailed in Exhibit A-1, SBAS Statement of Work, shall be a
Firm Fixed Price of Thirty-Eight Million, One Hundred and
Thirty-Nine Thousand, Eight Hundred and Thirty-Four U.S.
dollars (US$38,139,834) (the "SBAS Firm Fixed Price").
B. For the SBN and SBN Work. Subject to Article 4.2 hereof, the
price to be paid by Purchaser to Contractor for the
Deliverable Item 2 and the SBN and SBN Work-related portions
of Deliverable Items 4 and 5 set forth in Article 3.1 hereof,
within the scope of Work as detailed in Exhibit A-2, SBN
Statement of Work, shall be a Firm Fixed Price of Twenty-Two
Million, Five Hundred Thousand U.S. dollars (US$22,500,000)
(the "SBN Firm Fixed Price"), subject to the SBN Price
Reduction Option.
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4.1.3 Elements of FFP. Except as otherwise expressly provided in this
Contract, the Firm Fixed Prices are not subject to any escalation or to
any adjustment or revision. The Firm Fixed Price for those items
subject to an option under this Contract are described in the
particular Article(s) that set forth such options. The Firm Fixed
Prices for the SBAS and SBN and SBN Work include on-going design,
manufacturing, tests, Deliverable Data, Training, in-orbit system
testing, and insurance support services, packing and transport of the
Deliverable Items to the Delivery location, transit insurance and such
other insurance as is required by Article 24.
4.2 TAXES
A. Included Taxes. "Included Taxes" means any Taxes described as
included in a Firm Fixed Price or for which Contractor is
otherwise responsible in this Section 4.2A.
(i) Consumption Taxes. Except as otherwise set forth in
Section B(ii) (with respect to Consumption Taxes on
the sale, delivery and installation of the SBAS), the
Firm Fixed Prices include all applicable Taxes
imposed by any United States federal, state, or local
government.
(ii) Performance Taxes. The Firm Fixed Prices include any
Taxes by any taxing authority and related to the
design, development and manufacture of the
Deliverable Items.
(iii) Income, Employment and Property Taxes. Except as
otherwise stated in Section B(ii), the Firm Fixed
Prices include all U.S. and foreign income and
employment Taxes levied directly by any taxing
authority related to Contractor (or its
subcontractors') performance of this Contract,
including the installation, test, and delivery of the
Deliverable Items. Contractor shall be responsible
for all Taxes based on its property.
Contractor has made or will make all the necessary filings in
order to deliver the Work free and clear of any Contractor
incurred liens or encumbrances for Included Taxes. Subject to
the indemnification procedures set forth in Article 18.3, in
the event any governmental or taxing authority imposes or
assesses Included Taxes against Purchaser in connection with
any Deliverable Item, Contractor shall indemnify Purchaser for
any such Included Taxes paid by Purchaser and shall reimburse
Purchaser for related costs of defense (whether or not
Purchaser actually pays such Taxes).
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B. Excluded Taxes. "Excluded Taxes" means any Taxes described as
excluded from a Firm Fixed Price or for which Purchaser is
otherwise responsible in this Section 4.2B.
(i) SBAS - Sales Taxes. The SBAS Firm Fixed Price does
not include, and Purchaser shall be responsible for
paying, either directly to the governmental agency or
as billed by Contractor:
(a) any and all Consumption Taxes imposed by any
United States federal, state, or local
government on the sale, delivery and
installation of the SBAS Deliverable Items,
(b) any and all Consumption Taxes imposed by any
Canadian federal or provincial government on
the sale, delivery and installation of the
SBAS Deliverable Items (including, if
applicable, Canadian GST, HST and/or PST for
which Contractor is responsible to remit to
the applicable taxing authority on behalf of
Purchaser), provided that Contractor will
take all steps within its control that are
necessary to ensure that all applicable
exemptions and tax credits are available in
respect of the SBAS Deliverable Items, and
will cause any subcontractor to take all
steps within its control that are necessary
to ensure that all applicable exemptions and
tax credits are available in respect of the
SBAS Deliverable Item. Purchaser shall not
be obligated to reimburse Contractor for any
such Taxes for which HNS (or any
subcontractor) is responsible to remit to
the applicable taxing authority on behalf of
Contractor so long as Contractor is not
liable to HNS (or any subcontractor) for
such Taxes with respect to the SBAS
Deliverable Items.
(ii) SBAS - Canadian Income Taxes. To the extent that
Canadian tax law requires Purchaser to withhold, and
remit to a Canadian governmental agency on
Contractor's behalf, a portion of the payment of the
SBAS Firm Fixed Price for income tax withholding
imposed on Contractor related to the SBAS Work
delivered to or performed in Canada (the "105
Withholding"), Purchaser shall reimburse Contractor
for the amount of such 105 Withholding to the extent
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that Contractor does not receive a refund, credit or
set off for the 105 Withholding against its other
Canadian tax liabilities, if any; provided that
Contractor has taken all reasonable steps necessary
to seek and receive such refund, credit or set off
(including objecting and appealing any determination
= that Contractor is not entitled to receive such
refund, credit or set off so long as Contractor
reasonably determines that such an objection or
appeal should prevail; provided that if Contractor
determines not to object or appeal, Contractor shall
so notify Purchaser in writing at least thirty (30)
days prior to the expiration of the Contractor's
right to object or appeal or in the event the period
to object or appeal is less than thirty (30) days, as
soon as reasonably possible). If Contractor has
reasonably determined that such an objection or
appeal should not prevail and has so notified the
Purchaser as provided above, then at Purchaser's
request and expense, Contractor shall file an
objection and/or appeal in respect of the refund,
credit of set off and Purchaser shall have the right
(at the Purchaser's expense) to assume carriage of
any such objection and/or appeal and to use counsel
chosen by the Purchaser. Purchaser shall make such
reimbursement within thirty (30) days following
Purchaser's receipt of a certification signed by
Contractor's Chief Financial Officer stating that (A)
(i) the refund, credit or set off against its other
Canadian tax liabilities if any was denied, (ii) if
reasonably determined to be in its best interest,
Contractor appealed the denial, and (iii) if
applicable, the appeal for the requested refund,
credit or set off was denied or (B) that no refund,
credit or set off against other Canadian tax
liabilities is available. Any such reimbursement
shall be in an amount sufficient to place Contractor
in the same after-tax position as Contractor would
have been if the SBAS Firm Fixed Price had been
received without any 105 Withholding. The parties
confirm that the 105 Withholding is on account of
Contractor's Canadian tax liability and is treated as
a tax withheld at source which can be credited
against Canadian taxes payable, and if the Contractor
does not have any Canadian tax liability, Contractor
should be entitled to receive a refund of the 105
Withholding from the Canada Revenue Agency. The
reimbursement in this paragraph only applies if the
Contractor does not receive a refund, credit or set
off of the 105 Withholding against its other Canadian
tax liabilities. Notwithstanding anything to the
contrary herein, in no event shall Purchaser's
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obligation to reimburse Contractor under this
provision, or otherwise compensate for any Canadian
income tax liabilities, exceed U.S. $375,000.
C. All Taxes billed by Contractor shall be separately stated on
the applicable invoice.
D. Purchaser shall withhold any Taxes from payments to Contractor
as required by law and shall not be responsible to "gross-up"
payments made or withheld by Contractor to HNS to compensate
for any HNS tax liabilities for which Contractor has no
liability.
E. The Parties shall cooperate to minimize all Taxes.
F. The Parties agree to designate in this Contract the value of
the goods delivered to, and the services performed in, Canada
as soon as reasonably practicable.
4.3 MOST FAVORED CUSTOMER
Contractor shall include the following requirement in the HNS Subcontract and
extend any price adjustment to Purchaser hereunder: If HNS provides any
equipment similar to any equipment composing the SBAS to any third party at
prices lower than the prices charged to Contractor on business terms,
quantities, specifications, delivery schedules and terms and conditions similar
to those under the HNS Subcontract, taken as a whole, then Contractor's price
for the SBAS as set forth in the HNS Subcontract shall be appropriately adjusted
to provide the benefit of such lower price, and the SBAS Firm Fixed Price shall
be reduced to reflect the amount of such adjustment. Such adjustment shall be
retroactive to the first date on which the lower charges to any such third party
became effective.
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ARTICLE 5 - PAYMENTS
5.1 PAYMENT PLAN
Payment Milestones for the Firm Fixed Prices set forth in Article 4 with respect
to the following items are as set forth in the corresponding Exhibits listed
below.
-----------------------------------------
Firm Fixed Price Exhibit
-----------------------------------------
SBAS E-1
-----------------------------------------
SBN and SBN Work E-2
-----------------------------------------
5.2 PAYMENT CONDITIONS
5.2.1 Time Payments. Subject to Article 5.2.4, all time payments due from
Purchaser shall be paid no later than thirty (30) days after the date
specified for invoice therefor as set forth in the applicable Payment
Plan in Exhibit E-1 and Exhibit E-2. Contractor shall give to Purchaser
an invoice and certification in the form attached hereto as Attachment
A with respect to each such time payment. Subject to Article 5.2.4, the
failure of Contractor to deliver any invoice required hereunder shall
not affect Purchaser's obligation hereunder to make any time payments
to Contractor.
5.2.2 Milestone Payments. All payments due from Purchaser upon the completion
of a Milestone described in the applicable Payment Plan in Exhibit E-1
and Exhibit E-2 shall be paid no later than thirty (30) days after
receipt by Purchaser of an invoice and certification in the form
attached hereto as Attachment A that the Milestone has been completed
in accordance with the requirements of this Contract, together with the
necessary or appropriate supporting data and documentation as required
hereunder, if any, or as Purchaser may reasonably request within ten
(10) days of receipt of invoice. Notwithstanding the foregoing, and
without prejudice to Contractor's rights under Article 5.6, Purchaser,
in its sole discretion, may agree to make a partial payment to
Contractor for partial completion of a Milestone event. In the event of
early completion by Contractor of a Milestone in advance of such
Milestone completion date as set forth in Exhibit E-1, SBAS Program
Payment Plan, or Exhibit E-2, SBN Program Payment Plan and Termination
Liability Amount, Purchaser shall not be obligated to make the
corresponding Milestone payment to Contractor in advance of the payment
due date that would apply under this Article 5.2 to the applicable
invoice date set forth in Exhibit E-1, SBAS Program Payment Plan, or
Exhibit E-2, SBN Program Payment Plan and Termination Liability Amount.
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5.2.3 Cumulative Payments. In no event shall Contractor submit an invoice
whose amount, when paid, would exceed the aggregate, cumulative sum of
payments (time payments plus Milestone payments) scheduled to be paid
to Contractor up to such point of time of payment under Exhibit E-1,
SBAS Program Payment Plan, or Exhibit E-2, SBN and SBAS Program Payment
Plan and Termination Liability Amount, as applicable.
5.2.4 Obligation to Pay. If Contractor shall not have delivered any invoice
or certification required hereunder within the time specified therefor,
the relevant payment due from Purchaser shall be payable on or before
thirty (30) days after receipt of such invoice or certification.
5.3 LATE PAYMENT
5.3.1 Interest. In the event that any payment due under this Contract, other
than a payment disputed in accordance with Article 5.6 or due under
Exhibit E-1, SBAS Program Payment Plan, is not made when due hereunder,
without prejudice to the other rights and remedies under this Contract
of the Party entitled to such payment, such Party shall also be
entitled to interest at the rate of LIBOR (90 day rate) + 300 basis
points per annum on the unpaid balance thereof from the date such
payment is due hereunder until such time as payment is made. If any
undisputed payment due under Exhibit E-1, SBAS Program Payment Plan, is
not made within thirty (30) days after such amount is due, without
prejudice to Contractor's other rights and remedies under this
Contract, Contractor shall also be entitled to interest at the rate of
LIBOR (90 day rate) + 300 basis points per annum on the unpaid balance
thereof from the date such payment is due until such time as payment is
made.
5.3.2 Suspension of Performance. If any payment (other than a disputed
payment as set forth below) is not made by Purchaser by the date thirty
(30) days after the date due in accordance with Article 5.2, or if a
payment that is disputed by Purchaser pursuant to Article 5.6 is not
paid into an escrow account as specified in such Article, then without
prejudice to Contractor's other rights and remedies under this Contract
or at law or in equity, Contractor may elect to suspend performance of
its obligations under this Contract, without prejudice or penalty,
until the affected payment is made. If Contractor subsequently resumes
performance, the schedule and affected terms of this Contract shall be
equitably adjusted due to such work stoppage and the price shall be
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equitably adjusted to compensate Contractor for actual costs reasonably
incurred by Contractor associated with such work stoppage, plus a
markup of ten percent (10%) on those costs, such costs and markup to be
invoiced and paid pursuant to the provisions of Article 5.
5.4 INVOICES
Invoices required to be delivered by Contractor hereunder shall be submitted by
facsimile and airmail to Purchaser (original plus one (1) copy, including
supporting documentation and data) at the following address:
TerreStar Networks Inc.
------------------------------------------
Attn.: [***]
------------------------------
[***]
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12010 Sunset Hills Road
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------------------------------
Reston, VA 20190
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Tel: [***]
------------------------------
Fax: [***]
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With a copy to:
TerreStar Networks Inc.
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Attn.: [***]
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[***]
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12010 Sunset Hills Road
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Reston, VA 20190
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Tel: [***]
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Fax: [***]
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or to such other address as Purchaser may specify in writing to Contractor.
5.5 PAYMENT BANK
All payments made to Contractor hereunder shall be in U.S. currency and shall be
made by electronic funds transfer to the following account:
SPACE SYSTEMS/LORAL, INC.
ACCOUNT NO. [***]
BANK OF AMERICA NT&SA
CHICAGO, ILLINOIS
[***]
or such other account or accounts as Contractor may specify in writing to
Purchaser.
5.6 DISPUTED AMOUNTS
In the event Purchaser determines in good faith that the event covered by a
Contractor Milestone payment invoice has not been substantially completed in
accordance with the requirements of this Contract, Purchaser shall so notify
Contractor in writing within thirty (30) days of receipt of the invoice. Such
notification shall state in reasonable detail the area(s) Purchaser considers
not to be in accordance with the requirements of this Contract. Within five (5)
Business Days of receipt of Purchaser's notification, Contractor shall notify
Purchaser in writing if it disagrees with Purchaser's determination, stating its
good faith basis for such disagreement. Within ten (10) Business Days
thereafter, the Parties' respective senior executives shall meet and use good
faith efforts to resolve such disagreement. If the senior executives are unable
to resolve the disagreement within ten (10) Business Days, Purchaser shall
immediately place the payment amount in dispute into an escrow account (which
the Parties shall establish with a mutually acceptable escrow agent promptly
after the SBN EDC) pending resolution pursuant to Article 22, Dispute
Resolution. Should Contractor agree with Purchaser's notification, Contractor
shall proceed to correct the discrepancy(ies), and, upon correction, the invoice
shall be reinstated for payment. The Parties shall equally share in the third
party escrow fees incurred in connection with this Article 5.6.
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5.7 SET OFF
In the event one Party has not paid the second Party any amount that is due and
payable to the second Party under this Contract, such second Party shall have
the right to set off such amount against payments due to the first Party under
this Contract, provided any amount in dispute pursuant to Article 5.6 shall not
be considered eligible for setoff while the Dispute is being resolved.
5.8 SPECIAL FINANCIAL TERMS
Prior to Intentional Ignition, as defined in the Satellite Contract, in the
event that: (a) Contractor or Loral Space & Communications Inc. is not rated at
least "BB" by Standard & Poor's rating agency or a similar rating by another
nationally recognized rating agency; or (b) Contractor does not have a balance
of cash, cash equivalents and liquid securities of at least [***]U.S. dollars
(US$[***]), then amounts paid by Purchaser to Contractor under the Contract will
be used solely for purposes of performing the Work and the execution of
Contractor's manufacturing business. Nothing in this Article 5.8 shall obligate
Contractor to change its current tracking and cash management systems.
5.9 TIME AND MATERIAL SERVICES
With respect to additional services for which a time and materials pricing
mechanism is described in this Contract, Contractor shall provide Purchaser such
additional services, with Contractor's labor billed at Contractor's then current
(fully-burdened) hourly rates as determined in accordance with Contractor's
standard accounting practices, plus actual material charges, plus a profit of
[***] percent ([***]%). Upon reasonable written notice, Purchaser shall have the
right, at Purchaser's expense, to have a third party auditor, reasonably
acceptable to Contractor, conduct an audit of Contractor's hourly rate charges
billed to Purchase to verify that the rates charged to Purchaser comply with
this Article 5.8; however, the detailed rates shall be redacted from any report
(written or otherwise) provided to Purchaser by the auditor. Notwithstanding the
foregoing, the audit report may include the amount of charges that are disputed
by the auditor, and, unless disputed by Contractor in good faith, such amount of
overcharge as determined by the auditor shall be refunded to Purchaser.
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ARTICLE 6 - PURCHASER-FURNISHED ITEMS
6.1 PURCHASER-FURNISHED SUPPORT
To enable Contractor to perform the SBN Work and to install and complete
Acceptance inspection of the SBAS, Purchaser shall timely make available to
Contractor the Purchaser-furnished equipment, facilities and services described
in Section 2.6 of Exhibit A (Satellite Statement of Work) of the Satellite
Contract, and Section 9 of Exhibit A-1 of this Contract, SBAS Statement of Work.
At all times, as between Contractor and Purchaser, such Purchaser-furnished
equipment, facilities and items shall remain Purchaser's property. Such
equipment, facilities and services shall be in good working condition and
adequate for the required purposes. Contractor shall provide Purchaser with
reasonable prior written notice of its need (including the need of any of its
subcontractors, consultant and/or agent) to access any of the
Purchaser-furnished sites. Contractor shall not provide access to or use of the
Purchaser-furnished sites, equipment or other items to any third party other
than an authorized subcontractor, consultant and/or agent of Contractor for
purposes of performing subcontracted Work. Contractor shall comply with the
terms of the lease for each site, as provided in writing to Contractor.
Contractor shall ensure that no lien, encumbrance, pledge or other interest
whatsoever attaches to the Purchaser-furnished equipment, sites and other items
as the result of acts or omissions of Contractor or its subcontractors.
Purchaser and Contractor will conduct an interface meeting on the date
established therefor at the technical interchange meeting described in Section
2.6.1 of Exhibit A (Statement of Work) of the Satellite Contract, to confirm the
availability and adequacy of Purchaser-furnished equipment, facilities and
services.
6.2 COMMUNICATIONS AUTHORIZATIONS
Contractor shall provide such reasonable cooperation and support as Purchaser
may reasonably request in support of Purchaser's preparation, coordination and
filing of applications, registrations, reports, licenses, permits and
authorizations for the construction, launch and operation of each Satellite.
From and after Acceptance of the SBN and SBN Work, for any support provided by
Contractor under this Article 6.2, Contractor shall be entitled to reimbursement
of actual costs reasonably incurred in connection with the provision of such
support plus a markup of [***] percent ([***]%), with such costs and associated
markup to be invoiced and paid in accordance with Article 5.
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6.3 RADIO FREQUENCY COORDINATION
Contractor shall provide reasonable cooperation and support as Purchaser may
reasonably request in support of Purchaser's efforts in the preparation and
submission of filings required by the International Telecommunication Union (or
any successor agency thereto) and all relevant domestic communications
regulatory authorities regarding radio frequency and orbital position
coordination. From and after Acceptance of the SBN and SBN Work, for any support
provided by Contractor under this Article 6.3, Contractor shall be entitled to
reimbursement of actual costs reasonably incurred in connection with the
provision of such support plus a markup of [***] percent ([***]%), with such
costs and markup to be invoiced and paid in accordance with Article 5.
6.4 LATE DELIVERY OF PURCHASER-FURNISHED ITEMS OR SERVICES
The late delivery of Purchaser-furnished items or services, individually or
combined, shall not be considered a default by Purchaser, but shall be
considered an event beyond the reasonable control of Contractor, and Contractor
shall be entitled to adjustments in price, schedule, performance requirements
and other terms of this Contract in accordance with Article 16 (Purchaser Delay
of Work).
6.5 HNS CONTRACT ITEMS
On and effective as of the Effective Date, Purchaser shall provide to Contractor
for use on this Contract all deliverables and work-in-process acquired by
Purchaser pursuant to the HNS Contract.
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ARTICLE 7 - COMPLIANCE WITH U.S. LAWS AND DIRECTIVES
7.1 GENERAL
Each Party shall, at its expense, perform its respective obligations hereunder
in accordance with all applicable laws, regulations, and policies of the United
States and the conditions of all applicable United States Government approvals,
permits, or licenses.
Without limiting the generality of the foregoing, Contractor will not, directly
or indirectly, take any action that would cause Purchaser to be in violation of
U.S. anti-boycott laws under the U.S. Export Administration Act, the U.S.
Internal Revenue Code, or any regulation thereunder. Neither Party shall,
without prior written authorization from the Department of State/Commerce or
other agency of the U.S. Government having jurisdiction, export, directly or
indirectly, any U.S. source technical data (as defined in accordance with
applicable regulations) acquired from the other Party or any products utilizing
any such data, to any country for which at the time of export, an export license
or other governmental approval is required by an applicable statute or
regulation.
In its performance of this Contract, neither Party will, directly or indirectly,
make, offer, or agree to make or offer any loan, gift, donation, or other
payment whether in cash or in kind, for the benefit or at the direction of any
candidate, committee, political party, government or its subdivision, or any
individual elected, appointed, or otherwise designated as an employee or officer
thereof, for the purpose of influencing any act or decision of such entity or
individual or inducing such entity or individual to do or omit to do anything,
in order to obtain or retain business or other benefits except as may be
expressly permitted under the Foreign Corrupt Practices Act and the regulations
promulgated thereunder.
7.2 COMPLIANCE WITH U.S. EXPORT CONTROL LAWS
7.2.1 Performance in Accordance with Law. Contractor shall, at its expense,
perform the Work in accordance with all applicable export control laws,
regulations, and policies of the United States and the conditions of
all applicable United States Government approvals, permits, and
licenses. Without limiting the generality of the foregoing, Contractor
shall timely apply for and use reasonable and diligent efforts to
obtain U.S. and non-U.S. Government approvals, permits and licenses
necessary for export or import of the Deliverable Items and services
and other technical data and equipment related to the SBAS or SBN and
SBN Work being furnished by Contractor, pursuant to or to be utilized
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in connection with this Contract. Purchaser agrees to cooperate with
Contractor in Contractor's efforts to obtain any such approvals,
permits and licenses, including providing Contractor with requirement
information in Purchaser's possession.
7.2.2 Cooperation. Any obligation of Contractor hereunder to provide
hardware, software, Deliverable Data, other technical information or
technical services to Purchaser and its personnel and/or its
representatives shall be subject to applicable U.S. Government export
control and security laws, regulations, policies and license
conditions, as construed by Contractor in good faith. The Parties shall
work cooperatively and in good faith to implement this Contract in
compliance with such laws, regulations, policies and license
conditions. If and to the extent required by U.S. law, Purchaser and
its personnel and/or representatives shall enter into U.S.
Government-approved agreement(s), separate from this Contract,
governing Contractor's provision of hardware, software, Deliverable
Data, other technical information or technical services in connection
with this Contract.
7.3 LICENSES AND OTHER APPROVALS
Contractor shall timely apply for and, once issued, maintain U.S. Government
export licenses, agreements and other approvals that are required for "foreign
person" personnel and/or representatives of Purchaser (including, but not
limited to, foreign subsidiaries and related entities of Purchaser involved with
the procurement) as well as Purchaser's insurance providers and Canadian
authorities (as may be required under Canadian law) to have access to Contractor
facilities, hardware, software, Deliverable Data, other technical information or
technical services in connection with the performance of this Contract. A
"foreign person" shall be as defined in the International Traffic in Arms
Regulations, 22 C.F.R. ss.120.16. As early as practicable, and in no event later
than fifteen (15) days after SBN EDC, Purchaser shall provide Contractor with a
list of countries (if other than the U.S.) of which "foreign person" personnel
and/or representatives of Purchaser (including, but not limited to foreign
subsidiaries and related entities of Purchaser involved with the procurement) as
well as Purchaser's insurance providers and Canadian authorities (as may be
required under Canadian law) are citizens, if such personnel, representatives,
insurance providers and Canadian authorities will or may have access to U.S.
export-controlled items under this Contract. Purchaser shall provide the
reasonable cooperation and support necessary for Contractor to apply for and
maintain such required U.S. export licenses, agreements and other approvals, and
shall promptly notify Contractor of any occurrence or change in circumstances of
which it becomes aware that is relevant to or affects such export licenses,
agreements and approvals. At Purchaser's request, Contractor shall include
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Purchaser (and related entities involved with the procurement, including any
foreign companies necessarily required to be part of the development,
procurement or integration) as a named party in any application to the U.S.
Government for approval of such export licenses, agreements and other approvals
so as to permit Purchaser to be present during any discussion or meetings where
Purchaser's foreign subsidiaries/related entities, insurance providers and/or
Canadian authorities may receive from or discuss with Contractor
export-controlled technical data. Contractor shall provide the parties to such
export licenses and agreements copies of the export licenses and agreements,
including any U.S. Government provisos related to same.
Contractor shall review with Purchaser any application Contractor makes to any
government department, agency, or entity for any approval, permit, license, or
agreement, as may be required for performance of the HNS Subcontracted Work,
prior to submission of such application. Contractor shall provide Purchaser a
minimum of three (3) Business Days to review such application prior to
submission to such governmental entity, and Contractor shall in good faith
consider any comments and proposed revisions made by Purchaser for incorporation
into such application.
NOTWITHSTANDING ANY PROVISION IN THIS CONTRACT, IN NO EVENT SHALL CONTRACTOR BE
OBLIGATED UNDER THIS CONTRACT TO PROVIDE ACCESS TO CONTRACTOR OR SUBCONTRACTOR
FACILITIES; PROVIDE ACCESS TO OR FURNISH HARDWARE, SOFTWARE, DELIVERABLE DATA OR
OTHER TECHNICAL INFORMATION; OR PROVIDE TECHNICAL/DEFENSE SERVICES, TO ANY
PERSON EXCEPT IN COMPLIANCE WITH APPLICABLE U.S. EXPORT CONTROL LAWS,
REGULATIONS, POLICIES AND LICENSE CONDITIONS, AS CONSTRUED BY CONTRACTOR IN GOOD
FAITH.
7.4 NO UNAUTHORIZED EXPORTS OR RETRANSFERS
PURCHASER SHALL NOT EXPORT OR TRANSFER TO ANY "FOREIGN PERSON" ANY HARDWARE,
SOFTWARE, DELIVERABLE DATA, OTHER TECHNICAL INFORMATION OR TECHNICAL/DEFENSE
SERVICES FURNISHED HEREUNDER, EXCEPT AS EXPRESSLY AUTHORIZED BY THE U.S.
GOVERNMENT IN ACCORDANCE WITH THE EXPORT LICENSES, AGREEMENTS AND OTHER
APPROVALS REFERENCED IN ARTICLES 7.1 AND 7.2 OR AS OTHERWISE EXPRESSLY
AUTHORIZED UNDER U.S. EXPORT CONTROL LAWS.
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IF PURCHASER IS A "FOREIGN PERSON", PURCHASER SHALL NOT RE-EXPORT, RE-TRANSFER
OR DIVERT TO ANY THIRD PARTY ANY ITEM EXPORTED TO PURCHASER UNDER OR IN
CONNECTION WITH THIS CONTRACT, EXCEPT AS EXPRESSLY AUTHORIZED BY THE U.S.
GOVERNMENT IN ACCORDANCE WITH THE EXPORT LICENSES, AGREEMENTS OR OTHER APPROVALS
REFERENCED IN ARTICLES 7.1 AND 7.2 OR AS OTHERWISE EXPRESSLY AUTHORIZED UNDER
U.S. EXPORT CONTROL LAWS.
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ARTICLE 8 - ACCESS TO WORK IN PROGRESS
8.1 GENERAL
Contractor represents and warrants that, subject to Article 7, the access to the
Work and Work-in-progress to be provided Purchaser personnel (and Purchaser's
duly appointed consultants and agents) under this Contract is or shall be
substantially similar to the access to the Work and Work-in-progress Contractor
provides to its other major commercial customers. In the event Contractor
becomes aware that the access to the Work and Work in progress provided under
this Contract is otherwise, Contractor shall promptly remedy that situation.
8.2 WORK IN PROGRESS AT CONTRACTOR'S FACILITY
Subject to Article 7 and compliance with Contractor's normal and customary
safety and security regulations, policies, procedures and practices of which
Purchaser has received prior written notice, Purchaser personnel (and
Purchaser's duly appointed consultants and agents) shall be allowed unescorted
access to all Work being performed at Contractor's facility for the Deliverable
Items, for the purpose of observing the progress of such Work during normal
program business hours and at such other hours as Contractor may agree. Subject
to Article 7, Purchaser shall be provided ten (10) non-escort permanent badges
and ten (10) escort badges to agreed work areas where the Work is being
performed.
8.3 WORK IN PROGRESS AT SUBCONTRACTORS' FACILITIES
In the case of Contractor's Major Subcontracts, and such other non-major
subcontracts under which the effort in support hereunder involves significant
design or qualification or the subcontractor is experiencing performance
difficulties which may have a material adverse effect on the Delivery schedule
or performance or provision of a Deliverable Item, Contractor shall use
commercially reasonable efforts to require that each such subcontract contain a
provision substantially similar to this Article 8 with respect to access to the
applicable subcontractor's facilities and performance of the Work. Such access
shall be subject to Article 7 and (i) each such subcontractor's safety and
security regulations of which Purchaser is advised in writing prior to any
visit, and (ii) right of Contractor to accompany Purchaser on any such visit to
a subcontractor's facility. In addition, Purchaser Personnel shall be allowed to
attend all the Major Subcontractor's design and technical reviews.
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8.4 ON-SITE FACILITIES FOR PURCHASER'S PERSONNEL
8.4.1 Contractor Facilities. For the purpose of monitoring the progress of
the Work being performed by Contractor hereunder and under the
Satellite Contract, Contractor shall provide office facilities at or
proximate to Contractor's plant for up to five (5) resident Purchaser
personnel (and/or Purchaser's duly appointed consultants and agents)
through Acceptance of the SBN and SBN Work. The office facilities to be
provided shall include a reasonable amount of office space, office
furniture, local telephone service, reasonable long-distance telephone
usage, internet access (at the same speed and quality available to
Contractor personnel), access to Contractor's exchange network specific
to this Contract, access to copy machines, facsimile machines, meeting
rooms, and to the extent available, videoconference rooms, and car
parking facilities, to the extent necessary to enable Purchaser
personnel to monitor the progress of Work under this Contract.
8.4.2 Subcontractor Facilities. In the case of Contractor's Major
Subcontracts related to the SBAS, SBN and SBN Work and payload,
Contractor shall use commercially reasonable efforts to ensure that
reasonable office facilities for up to three (3) Purchaser personnel
(and/or Purchaser's duly appointed consultants and agents) are provided
on a temporary basis to attend meetings or witness tests.
Notwithstanding the foregoing, Contractor shall require HNS to provide
office facilities (consistent with the specifications described in
Article 8.4.1) for up to two (2) Purchaser personnel through Final
Acceptance of the SBAS Operational Component, for the purpose of
monitoring the progress of the Work associated with the SBAS.
8.5 PURCHASER REPRESENTATIVES AS COMPETITORS/FOREIGN PERSONS
Contractor may, in its reasonable discretion, deny access to Contractor's
facilities, products or information to any and all Purchaser consultants and
agents who are in direct competition with and/or currently employed by companies
or entities that are in direct competition with Contractor for the sale of
commercial telecommunications satellites. Purchaser shall notify Contractor in
writing of the name, title or function, business relationship, employer,
citizenship status under U.S. export laws and such other information as may be
reasonably requested by Contractor, with respect to each of its intended
consultants and agents, and cause each such consultant and agent to: (i) execute
a confidentiality agreement directly with Contractor in form and substance
reasonably satisfactory to Contractor and containing terms substantially the
same as those set forth in Article 27 and Article 28; and (ii) pursuant to
Article 7, execute a Technical Assistance Agreement or other agreement to ensure
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compliance with applicable U.S. export control laws and regulations to the
extent required by applicable U.S. export laws or regulations as interpreted by
Contractor in good faith. Where Purchaser has not complied with this Article
8.5, Contractor may, in its discretion, deny any consultant or agent of
Purchaser access to Contractor facilities, products or information.
8.6 INTERFERENCE WITH OPERATIONS
Purchaser shall exercise its rights under this Article 8 in a manner that does
not unreasonably interfere with Contractor's or its subcontractors' normal
business operations or Contractor's performance of its obligations under this
Contract or any agreement between Contractor and its subcontractors.
8.7 FINANCING ENTITIES
Subject to the provisions of Article 7, each Financing Entity shall have access
to the Work in the same manner and to the same extent as Purchaser consultants
and agents under this Article 8.
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ARTICLE 9 - SBN AND SBN WORK ACCEPTANCE
9.1 SBN REQUIREMENTS ANALYSIS, IOT AND ACCEPTANCE
9.1.1 Determination of Definitive SBN Performance Specification
A. SBN Performance Specification Analysis. The Parties
acknowledge that as of SBN EDC, Contractor has not verified
whether it is feasible for the integration of the SBAS
Operational Component (based on Exhibit B-1, SBAS Performance
Specification on the SBN EDC) and the Satellite (based on
Exhibit B of the Satellite Contract), to result in an SBN that
conforms to Exhibit B-2, SBN Performance Specification. As
further described in Exhibit A-2, SBN Statement of Work, no
later than SBN CDR, Contractor shall conduct the Requirements
Analysis and: (i) verify that it is feasible for the
integration of the SBAS Operational Component and the
Satellite to result in an SBN that conforms to Exhibit B-2,
SBN Performance Specification, or (ii) determine that it is
not feasible for the integration of the SBAS Operational
Component and the Satellite to result in an SBN that conforms
to Exhibit B-2, SBN Performance Specification, in which case
Contractor shall (a) determine the expected performance of the
SBN if the Performance Specification for the Satellite and the
SBAS Operational Component are not modified (the "Degraded SBN
Performance Specification"), and (b) provide Purchaser with
reasonable change order proposals, including price, schedule
and other impacts, necessary to modify Exhibit B (Satellite
Performance Specification) of the Satellite Contract and/or
Exhibit B-1 (SBAS Performance Specification) of this Contract,
that will result in an SBN that conforms to Exhibit B-2, SBN
Performance Specification ("Conforming Change Orders").
B. Definitive SBN Performance Specification. In the event of
verification pursuant to Article 9.1.1.A (i), Exhibit B-2, SBN
Performance Specification on the SBN EDC shall be deemed the
Definitive SBN Performance Specification. In the event of the
determination pursuant to Article 9.1.1.A(ii), subject to
Article 9.1.3.C, the following shall apply:
(i) If Purchaser agrees to all of the Conforming Change
Orders, the Definitive SBN Performance Specification
shall be the Exhibit B-2, SBN Performance
Specification on the SBN EDC, and this Contract shall
be timely modified to incorporate the terms of such
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Conforming Change Orders in the case of modifications
to Exhibit B-1, SBAS Performance Specification, and
the Satellite Contract shall be timely modified by
the Parties to incorporate the terms of such
Conforming Change Orders in the case of modifications
to Exhibit B, Satellite Performance Specification;
(ii) If Purchaser does not agree to any of the Conforming
Change Orders, the Definitive SBN Performance
Specification shall be the Degraded SBN Performance
Specification; or
(iii) If Purchaser agrees to some, but not all of the
Conforming Change Orders, the Definitive SBN
Performance Specification shall be as agreed by the
Parties, in good faith, based on the modifications to
the SBAS Operational Component and/or the Satellite
set forth in the agreed upon Conforming Change
Orders, or other change orders as the Parties may
agree, and this Contract and/or the Satellite
Contract shall be timely modified to incorporate the
terms of the agreed Conforming Change Orders/change
orders.
(iv) Contractor shall coordinate and cooperate with
Purchaser in preparing the Conforming Change
Orders/change orders respecting the SBN Performance
Specification. The Parties shall coordinate and
cooperate with respect to any change orders required
under the Satellite Contract pursuant to this Article
9.
9.1.2. Conduct of SBN IOT.
A. Phase 1 SBN IOT. Upon Acceptance of the TerreStar 1 Satellite
in accordance with the Satellite Contract and Preliminary
Acceptance of the SBAS Operational Component in accordance
with Article 10.2, Contractor shall: (i) conduct the SBN IOT
in accordance with Exhibit D-2, SBN Program Test Plan ("Phase
1 SBN IOT"); and (ii) at completion of the Phase 1 SBN IOT,
perform an initial review with Purchaser of the Phase 1 SBN
IOT results to determine whether the Phase 1 SBN IOT
demonstrates (in accordance with Exhibit A-2, SBN Statement of
Work and Exhibit D-2, SBN Program Test Plan), that the SBN is
either a Conforming SBN, Partially Degraded SBN or Fully
Degraded SBN. If the Phase 1 SBN IOT demonstrates that the SBN
is a Conforming SBN, at least twenty-four (24) hours prior to
the start of the SBN Acceptance/Handover Review (per Section
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3.3.7 of Exhibit A-2, SBN Statement of Work), Contractor shall
provide Purchaser with an SBN Summary Acceptance Report,
including full details on any non-conformity discovered during
the Phase 1 SBN IOT subject to a waiver and/or deviation
pursuant to Article 10.9 and shall conduct the SBN
Acceptance/Handover Review within three (3) Business Days of
completing the Phase 1 SBN IOT.
B. Phase 2 SBN IOT. If the Phase 1 SBN IOT demonstrates that the
SBN is a Partially Degraded SBN or Fully Degraded SBN, the
Contractor shall proceed in accordance with Article 9.1.3 (B)
(i) or Article 9.1.3 B (ii) below, as applicable (the "Phase 2
SBN IOT"). Thereafter, upon the earlier to occur of: (x) the
SBN being demonstrated to be a Conforming SBN; or (y)
expiration of the applicable time period set forth in Article
9.1.3 B (i) or Article 9.1.3 B (ii) below, the Phase 2 SBN IOT
shall be deemed complete, and Contractor shall conduct the SBN
Acceptance/Handover Review (per Section 3.3.7 of Exhibit A-2,
SBN Statement of Work), and will provide to Purchaser, at
least twenty-four (24) hours prior to the start of the SBN
Acceptance/Handover Review, an SBN Summary Acceptance Report,
including full details on any non-conformity discovered during
both the Phase 1 SBN IOT and the Phase 2 SBN IOT, including
any corrective actions taken; and conduct the SBN
Acceptance/Handover Review within three (3) Business Days of
the earlier to occur of (x) or (y) immediately above. In the
event that Phase 2 SBN IOT is required to be performed in
accordance with the provisions of this Article 9.1.2 B, then
the Phase 2 SBN IOT shall be deemed the "Final SBN IOT"; if
the Phase 2 SBN IOT is not so required to be performed as
provided in this Article 9.1.2 B, then the Phase 1 SBN IOT
shall be deemed to be the "Final SBN IOT".
C. Satellite Contract. For purposes of conducting the Phase 1 SBN
IOT and Phase 2 SBN IOT and other tasks set forth in this
Article 9, Purchaser shall authorize Contractor to have access
to the Satellite and other Purchaser facilities and data as
required for such performance, subject to the provisions of
Section 6.1 of this Agreement and to any applicable ITAR
restrictions, and will include this requirement in any
assignment or transfer agreement under the Satellite Contract.
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9.1.3 SBN IOT Results and Consequences
A. Conforming SBN. If the Final SBN IOT demonstrates that the SBN
is a Conforming SBN, Purchaser shall Accept the SBN and SBN
Work and Contractor shall earn and be paid the full amount of
the SBN Acceptance Payment.
B. Non-Conforming SBN.
(i) To the extent that the Phase 1 SBN IOT indicates that the SBN
is either a Partially or Fully Degraded SBN, and such degraded
condition is not due in whole or in part to the SBAS
Operational Component's failure to comply with the SBAS
Performance Specification (as such may have been modified in
connection with Preliminary Acceptance pursuant to Article
10), Contractor shall make commercially reasonable efforts for
up to ninety (90) days from the completion of the Phase 1 SBN
IOT to bring the SBN into conformity with the requirements of
Exhibit B-2, SBN Performance Specification. At the conclusion
of such ninety (90) day period, the Parties shall proceed as
provided in Article 9.1.2 above, and the following shall
apply:
(a) Purchaser shall Accept the SBN and SBN Work
upon the completion of the SBN
Acceptance/Handover Review;
(b) except as otherwise provided in, and subject
to, Article 9.1.4, Contractor shall earn and
be paid the Adjusted SBN Acceptance Payment
calculated in accordance with Article 9.1.4
if the SBN is a Partially Degraded SBN, or
Contractor shall not be entitled to any SBN
Acceptance Payment if the SBN is a Fully
Degraded SBN; and
(c) Contractor shall, at Purchaser's request, on
or promptly following the completion of the
SBN Acceptance/Handover Review, continue
efforts to make the SBN a Conforming SBN, at
Contractor's actual cost, and Contractor
shall invoice Purchaser for such cost (but
only to the extent that such Work is not
otherwise subject to warranty coverage
pursuant to Article 13 hereof), on a monthly
basis for such Work performed in the
previous month, and Purchaser shall pay the
undisputed portions of such amount within
thirty (30) days of Purchaser's receipt of
Contractor's invoice therefor, all in
accordance with Article 5.8.
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(ii) SBAS Operational Component Issue. To the extent that the Phase
1 SBN IOT indicates that the SBN is either a Partially or
Fully Degraded SBN, and if the non-conformity is due, in whole
or in part, to the SBAS Operational Component's failure to
comply with the SBAS Performance Specification (as such may
have been modified in connection with Preliminary Acceptance
pursuant to Article 10), Contractor shall make commercially
reasonable efforts for up to one hundred and fifty (150) days
from the completion of Phase 1 SBN IOT to bring the SBN into
conformity with the SBN-level requirements of Exhibit B-2, SBN
Performance Specification. For the avoidance of doubt,
Contractor shall have no obligation to continue efforts to
bring the SBN into conformity with the applicable SBN-level
requirements of Exhibit B-2, SBN Performance Specification,
beyond ninety (90) days from completion of the Phase 1 SBN
IOT, and has the right to cease such efforts between day
ninety (90) and day one hundred and fifty (150) from
completion of Phase 1 SBN IOT, if any SBN non-conformity that
may then exist is no longer due, in whole or in part, to the
SBAS Operational Component's failure to comply with the SBAS
Performance Specification (as such may have been modified in
connection with Preliminary Acceptance pursuant to Article
10). Upon the earlier to occur of: (x) the SBN being
demonstrated to be a Conforming SBN; (y) the cause of any SBN
non-conformity being demonstrated as no longer being related,
in whole or in part, to SBAS Operational Component's failure
to comply with the SBAS Performance Specification (as such may
have been modified in connection with Preliminary Acceptance
pursuant to Article 10), provided that this subsection (y)
will not apply until ninety (90) days following Phase 1 SBN
IOT; or (z) one hundred and fifty (150) days after completion
of the Phase 1 SBN IOT, Contractor shall provide Purchaser
with the SBN Summary Acceptance Report and shall conduct the
SBN Acceptance/Handover Review, each as provided in Article
9.1.2 B above, and Purchaser shall make one of the following
elections (in the event that Purchaser does not provide
written notification as required in Article 9.1.3B (ii) (a),
(b) or (c) below within five (5) Business Days of the
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completion of the such SBN Acceptance /Handover Review,
Purchaser shall be deemed to have elected to proceed under
Article 9.1.3B (ii) (a)):
(a) Accept the SBN and SBN Work (including Final
Acceptance of the SBAS Operational Component) in
writing and: (x) the provisions of Article 9.1.3B(i)
(a) through (c) shall apply; and (y) Contractor shall
earn and be paid the Final Acceptance Milestone
payment under Exhibit E-1, SBAS Program Payment Plan;
or
(b) Exercise its rights, in writing, under Article 21.1.1
B, if Purchaser has the right to terminate the SBAS
(including the SBAS Operational Component) under such
Article and: (x) Contractor shall not be entitled to
an SBN Acceptance Payment; and (y) the provisions of
Articles 21.1.1 B and 19.1.3 C shall apply; or
(c) Accept the SBN and SBN Work, but not Accept the SBAS
Operational Component, (by specifying, in writing, as
required by Article 10.2.5, the non-conformances of
the SBAS Operational Component to the applicable
requirements of Exhibit B-1, SBAS Performance
Specification, that Purchaser requires to be
corrected prior to giving Final Acceptance), in which
case, except as otherwise provided in, and subject
to, Article 9.1.4: (x) Contractor shall earn and be
paid the Adjusted SBN Acceptance Payment calculated
in accordance with Article 9.1.4 based on the
performance of the SBN derived utilizing the actual
measured performance of the SBN as determined at the
earlier to occur of (x), (y) or (z) of Article 9.1.3
B (ii) above; and (y) Contractor shall not earn or be
paid the Final Acceptance Milestone payment under
Exhibit E-1, SBAS Program Payment Plan, until such
time as the SBAS Operational Component achieves Final
Acceptance in accordance with Article 10.2.5.
(iii) Notwithstanding any provision of this Article to the contrary,
however, Contractor's obligations to Purchaser with respect to
correcting defects in the SBAS shall in no event be greater
than HNS's obligations to Contractor under the HNS Subcontract
with respect to correcting such defects.
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C. For purposes of Article 9.1.3.B, Contractor shall not have any
obligation to modify the SBAS Operational Component if such
modification would require a change or deviation to either or
both of the SBAS Performance Specifications and the Satellite
Performance Specifications as defined in the Satellite
Contract, unless Purchaser directs such change pursuant to
Article 14 or the change management procedure set forth in the
Satellite Contract, respectively.
D. Nothing in this Article 9.1 shall in any manner affect
Preliminary Acceptance of the SBAS Operational Component
pursuant to Article 10.2.2.
9.1.4 Calculation of Adjusted SBN Acceptance Payment. Contractor shall earn
all, none or a portion of the SBN Acceptance Payment based upon the
degree to which the SBN meets the SBN Key Performance Requirements at
the conclusion of the Final SBN IOT. In order to calculate the amount
of the Adjusted SBN Acceptance Payment earned by the Contractor, the
SBN Key Performance Requirements shall be subject to adjustment in
accordance with Article 9.1.4.A, below, and then such adjusted SBN Key
Performance Requirements shall be compared with the corresponding SBN
performance as measured during the Final SBN IOT, to determine the
amount, if any, of degradation experienced in any of the Key
Performance Requirements criteria. The degradation values derived for
each of the Key Performance Requirements shall then be the basis for
determining the Adjusted SBN Acceptance Payment earned by Contractor
according to the formula specified in Article 9.1.4.B, below. The sum
used as the basis for calculating the Adjusted SBN Acceptance Payment
shall be [***]U.S. dollars (US$[***]), subject to adjustment in
accordance with Article 33.1 and 9.1.4B below.
A. At the completion of Final SBN IOT, each of the SBN Key
Performance Requirements shall be adjusted to reflect (i) IOT
measurement error determined as mutually agreed by the Parties
at SBN CDR; (ii) actual SBAS Operational Component performance
as measured upon SBAS Operational Component Preliminary
Acceptance, and incorporated into a revised SBAS Performance
Specification applicable on and after such Preliminary
Acceptance pursuant to Article 10, and (iii) actual Satellite
performance as measured upon completion of Satellite IOT,
according to the terms of the Satellite Contract.
B. For each of the four (4) SBN Key Performance Requirements, the
corresponding Adjusted SBN Performance Criterion, derived in
accordance with Article 9.1.4.A above, shall be applied to the
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relevant table (Table 9A - 9D below) to determine whether and
how much of an Adjusted SBN Acceptance Payment reduction is
due. Reductions to the SBN Acceptance Payment based on the Key
SBN Performance Requirements shall be non-cumulative (not
additive), and shall be based only on the one (1) worst case
performance degradation from among the four Key SBN
Performance Requirements. The final Adjusted SBN Acceptance
Payment shall be determined for a Partially Degraded SBN
according to the percentages defined in the following tables:
Table 9A
--------------------------------------------------
95% PSA S-Band SBN Acceptance
Aggregate EIRP Payment Reduction
Degradation (dB) at + 6
degrees inclination
--------------------------------------------------
0 dB to < 1 dB [***]%
--------------------------------------------------
1 dB to < 2 dB [***]%
--------------------------------------------------
2 dB to < 3 dB [***]%
--------------------------------------------------
Table 9B
--------------------------------------------------
95% PSA S-Band G/T SBN Acceptance
Degradation (dB) at + 6 Payment Reduction
degrees inclination
--------------------------------------------------
0 dB to < 1 dB [***]%
--------------------------------------------------
1 dB to < 2 dB [***]%
--------------------------------------------------
2 dB to < 3 dB [***]%
--------------------------------------------------
Table 9C
--------------------------------------------------
S-Band C/I Total SBN Acceptance
Average Aggregate Payment Reduction
Degradation (dB) at 0
degrees inclination
--------------------------------------------------
dB to < 2 dB [***]%
--------------------------------------------------
dB to < 4 dB [***]%
--------------------------------------------------
dB to < 6 dB [***]%
--------------------------------------------------
Table 9D
--------------------------------------------------
SBN Service SBN Acceptance
Availability Degradation Payment Reduction
(%)
--------------------------------------------------
0 % to < 0.1 % [***]%
--------------------------------------------------
0.1 % to < 1.0 % [***]%
--------------------------------------------------
1.0 % to < 2.0 % [***]%
--------------------------------------------------
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Notwithstanding the foregoing, if the SBN is determined upon
completion of the Final SBN IOT to be a Partially or Fully
Degraded SBN (based on the SBN Key Performance Requirements
adjusted in accordance with Article 9.1.4 A) due in whole or
material part to the failure of the Satellite to meet the
requirements of the Satellite Performance Specification
defined in the Satellite Contract, then the maximum reduction
to the SBN Acceptance Payment shall be [***] U.S. dollars
(US$[***]), subject to adjustment in accordance with Article
33.1. Further, if each of the Satellite and the SBAS
Operational Component contributes significantly to the
degradation in SBN performance, the Parties shall negotiate in
good faith to equitably adjust amounts payable hereunder,
which equitable amount shall be consistent with limiting
Contractor's risk associated with the Satellite-related
degradations to the SBN Performance to [***] U.S. dollars
(US$[***]) (subject to adjustment in accordance with Article
33.1) as set forth above. Notwithstanding the foregoing, if
prior to Acceptance of the SBN and SBN Work, as a result of
any act or omission on the part of Purchaser or Purchaser's
representatives, consultants or subcontractors (including the
Launch Agency, as defined in the Satellite Contract, but
excluding Contractor and any of its subcontractors at any
tier) in the launch, orbit-raising, operation of, testing of,
or communication with, any Satellite, or operation of, testing
of, or communication with the SBAS Operational Component or if
due solely to causes not attributable to Contractor or its
subcontractors (other than extraordinary events customarily
listed as "Exclusions" under launch and in-orbit insurance
policies), such SBN is determined to be a Partially Degraded
SBN or Fully Degraded SBN, Contractor shall be deemed to have
earned the amount of the SBN Acceptance Payment that would
have been earned but for such event, act or omission resulting
in the SBN being a Partially or Fully Degraded SBN.
Example 1: If at the time of completion of the Final SBN IOT, the
Satellite is performing in compliance with the Satellite
Performance Specifications (as determined according to actual
Satellite performance upon completion of Satellite IOT in
accordance with the terms of the Satellite Contract), and the
Final SBN IOT results show that the Key Performance
Requirements are met, except that the 95% PSA S-Band Aggregate
EIRP (adjusted in accordance with Article 9.1.4.A) is degraded
by 1.5dBs, and the SBN 95% S-Band G/T (adjusted in accordance
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with Article 9.1.4A) is degraded by 2.2 dBs, the basis for
determining the Adjusted SBN Acceptance Payment will be
$[***], reduced by [***]% (the payment reduction percentage
per Table 9A for the 95% PSA Aggregate EIRP is [***]%; the
payment reduction percentage per Table 9B for the 95% PSA
S-Band Aggregate EIRP is [***]%; since the reduction per Table
9B is greater that the percentage reduction per Table 9A, the
larger reduction (per Table 9B) is applied against the SBN
Acceptance Payment): the SBN Acceptance Payment will be
$[***].
Example 2: If at the time of completion of the Final SBN IOT, the
Satellite is not performing in compliance with the Satellite
Performance Specifications (as determined according to actual
Satellite performance upon completion of Satellite IOT in
accordance with the terms of the Satellite Contract), and such
non-performance is not attributable to the Launch Vehicle, as
defined in the Satellite Contract, or other conditions not
attributable to Contractor as set forth in Article 12.2, and
the Final SBN IOT results show that the Key Performance
Requirements are met, except that the S-Band Aggregate EIRP
(adjusted in accordance with Article 9.1.4.A) is degraded by
2dBs solely due to the Satellite, the basis for determining
the SBN Acceptance Payment will be $[***], reduced by [***]%
($[***] - $[***] = $[***]), but will be subject to the [***]
U.S. dollar (US$[***]) Satellite risk cap. The Adjusted SBN
Acceptance Payment will be $[***].
9.2 LIMITATION ON CONTRACTOR'S LIABILITY
If Acceptance and Delivery of the SBN and SBN Work do not occur because
of (i) conditions or occurrences affecting the Satellite after the
Satellite IOT Completion Date and/or (ii) conditions or occurrences
affecting the SBAS after Intentional Ignition of the Launch Vehicle for
the Launch of the Satellite (all as defined in the Satellite Contract),
Purchaser's sole and exclusive remedies with respect to the use,
condition, or performance of the SBN (including with respect to the
SBAS and the Satellite) shall be: (i) Contractor's loss of all or a
portion of the SBN Acceptance Payment pursuant to Article 9.1.4 (if and
as applicable); (ii) as set forth in Article 10.2.2 and Article 12.1,
paragraph 2, of the Satellite Contract, subject to Article 30 of the
Satellite Contract (if and as applicable), and Purchaser shall be
entitled to pursue such remedies only under the Satellite Contract;
(iii) as set forth in Article 9.1.3.B; and/or (iv) as set forth in
Articles 13, 17, 20 and 21 with respect to the SBAS (if and as
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applicable). Except as set forth in the immediately preceding sentence,
Contractor shall have no liability with respect to Satellite(s) under
or in connection with this Contract.
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ARTICLE 10 - ACCEPTANCE FOR DELIVERABLE ITEMS OTHER THAN SBN AND SBN WORK
10.1 RESERVED
10.2 SBAS OPERATIONAL COMPONENT
10.2.1 Preliminary Acceptance Testing of the SBAS Operational Component. As
specified in Exhibit A-1, SBAS Statement of Work, Sections 7.4, 7.5 and
7.7, Contractor shall conduct factory acceptance testing, on-site
acceptance testing, and pre-launch system acceptance testing with
respect to the SBAS Operational Component. Prior to the performance of
each such acceptance test, Contractor shall provide Purchaser with an
acceptance test plan for Purchaser's approval (including acceptance
criteria outlined in the Acceptance Verification Plan to be developed
in accordance with Exhibit A-1, SBAS Statement of Work, and reflected
in approved updates to Exhibit D-1, SBAS Program Test Plan (and this
Contract will be modified as appropriate to incorporate such approved
updates to Exhibit D-1, SBAS Program Test Plan). Purchaser shall
promptly review and: (i) approve such test plan if it reasonably
determines it will demonstrate that the SBAS Operational Component
meets the applicable requirements of Exhibit B-1, SBAS Performance
Specification; or (ii) provide comments to Contractor regarding any
changes that are reasonably required in order to demonstrate that the
SBAS Operational Component meets the applicable requirements of Exhibit
B-1, SBAS Performance Specification (the "Approved SBAS Acceptance
Plan"). Contractor shall conduct all acceptance tests in accordance
with the Approved SBAS Acceptance Plan.
10.2.2 Full Compliance. Upon completion of each acceptance test associated
with the SBAS Operational Component and specified in the Approved SBAS
Acceptance Plan pursuant to Article 10.2.1, Contractor shall provide
Purchaser with written test results. If the acceptance test results
demonstrate the SBAS Operational Component's or subsystem thereof (as
applicable) compliance with the applicable requirements of Exhibit B-1,
SBAS Performance Specification, Contractor shall provide Purchaser with
a Certificate of Completion stating that such system or subsystem has
passed the applicable acceptance test. Only upon Purchaser's signing of
the Certificate of Completion, shall the specific system or subsystem
acceptance test be deemed completed. Should Purchaser not respond to a
Certificate of Completion submitted by Contractor for approval of the
relevant acceptance test within fifteen (15) Business Days, the
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relevant acceptance event shall be deemed to have occurred. Upon
successful completion of the factory acceptance testing, on-site
acceptance testing and pre-launch acceptance testing in accordance with
this Article 10.2.2, Preliminary Acceptance of the SBAS Operational
Component shall be deemed to occur.
10.2.3 Non-Conformance. In the event that the acceptance test results show
that the system or subsystem does not comply with the applicable
requirements of Exhibit B-1, SBAS Performance Specification, Contractor
shall promptly redesign, repair or replace or take such other action
with respect to such system or subsystem as is necessary to correct the
non-conformance, at which time the specific acceptance test, or
sub-test thereof as the Parties agree is appropriate, shall be
repeated. If Contractor, in good faith, disputes Purchaser's refusal to
approve any acceptance test results, the Parties shall meet and resolve
the dispute in accordance with the dispute resolution procedure
described in Article 22. If pursuant to Article 10.9 Purchaser agrees
to a waiver of and/or or deviation from the requirements of Exhibit
B-1, SBAS Performance Specification, in connection with Preliminary
Acceptance of the SBAS Operational Component hereunder, such waiver
and/or deviation shall be deemed to modify the affected provisions of
the applicable SBAS Performance Specification.
10.2.4 Notice and Shipment. Prior to conducting factory acceptance testing,
pre-launch system acceptance testing and post-launch acceptance testing
associated with the SBAS Operational Component, Contractor shall notify
Purchaser in advance in order to permit Purchaser representatives to be
present at such acceptance test. Contractor shall notify Purchaser in
writing, at least ten (10) days prior to shipment that Contractor is
prepared to ship the SBAS Operational Component to Purchaser's
gateway(s) for installation and site acceptance test. As specified in
Contractor's notice, Contractor shall thereafter ship the SBAS
Operational Component (in its constituent parts as appropriate) to the
Purchaser's gateway(s) for integration and test in accordance with the
applicable provisions of Exhibit B-1 and Exhibit D-1.
10.2.5 Final Acceptance. Final Acceptance of SBAS Operational Component will
occur upon successful completion of the SBAS Final Acceptance Test
Review, which shall commence within three (3) Business Days of
successful completion of SBAS Operational Component Final Acceptance
testing and submission of the SBAS Operational Component Final
Acceptance Test Report (to include the Certificate of Completion), all
in accordance with Section 7.8 of Exhibit A-1, SBAS Statement of Work.
Evidence of successful completion of the SBAS Final Acceptance Test
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Review shall consist of Purchaser's signature on the associated
Certificate of Completion provided by SS/L. Should Purchaser not
respond to the Certificate of Completion submitted by Contractor for
approval within fifteen (15) Business Days after conclusion of the SBAS
Final Acceptance Test Review, either by indicating in writing that
Purchaser accepts the SBAS Operational Component ("Final Acceptance" of
the SBAS Operational Component") or by specifying, in writing, the
non-conformances that Purchaser require to be corrected prior to giving
such Final Acceptance (in which case Contractor shall correct such
non-conformance, re-perform the Final Acceptance testing to the extent
agreed by the Parties, and re-submit the SBAS Operational Component for
Final Acceptance in accordance with the provisions of this Article
10.2.5), Final Acceptance of the SBAS Operational Component shall be
deemed to have occurred. Notwithstanding the foregoing, if such SBAS
Operational Component Final Acceptance testing cannot occur because of
conditions affecting the Satellite, the Parties will negotiate in good
faith an alternative plan for performance or completion of the SBAS
Operational Component's Final Acceptance testing or an appropriate
agreed alternative, all without prejudice to Purchaser's rights and
remedies associated with the SBAS Operational Component. In addition,
in the event that successful completion of the SBAS Final Acceptance
Test Review does not occur by 30 August 2008, for reasons solely
attributable to the Satellite or SBN completely independent of the SBAS
Operational Component performance, Contractor shall be entitled to
prepayment of the Final Acceptance payment associated with the SBAS
Operational Component in accordance with Section 2, Payment Schedule
for the Purchase Price, of Exhibit E-1, SBAS Program Payment Plan,
which prepayment is subject to refund in the event that it is not
earned.
10.3 SPARE PARTS
A. Inspection. Contractor shall notify Purchaser within a
reasonable time prior to shipping any Spare Part. With respect
to each Spare Part, Purchaser shall perform acceptance
inspection within ten (10) days after such Spare Part arrives
at the location designated for Delivery thereof in Article
3.1. The purpose of the acceptance inspection shall be to
determine whether each such Spare Part meets applicable
Performance Specification requirements as of the date of such
delivery, as such requirements may have been modified pursuant
to Article 10.9.
B. Acceptance Inspection Results. Within fifteen (15) days after
completion of acceptance inspection pursuant to Article 10.3 A
for any Spare Part, Purchaser shall notify Contractor in
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writing of the results of such acceptance inspection. In the
event that such acceptance inspection demonstrates conformity
of such Spare Part to the requirements of the applicable
Performance Specification, such Spare Part shall be accepted
by Purchaser for all purposes hereunder, and Purchaser's
written notice shall so state. In the event that such
acceptance inspection discloses any non-conformance of such
Spare Part to the applicable Performance Specification,
Purchaser's notice shall identify each such non-conformance,
and Contractor shall correct or repair such non-conformance
and resubmit such Spare Part for a subsequent acceptance
inspection in accordance with this Article 10.3B. Such
subsequent acceptance inspection shall be conducted by
Purchaser to the extent Purchaser deems relevant and necessary
to verify that the Spare Part conforms to the requirements of
the applicable Performance Specification. If Purchaser fails
to provide notice within the time specified, Acceptance shall
be deemed to have occurred with respect to such Spare Part.
10.4 SBAS TEST DELIVERABLES
The SBAS Test Deliverables shall be available to support the SBAS Operational
Component factory acceptance tests at the HNS facilities in accordance with
Section 4.0, Table 4.1 of Exhibit A-1, SBAS Statement of Work, and thereafter
shall be shipped to Contractor's facility to support the compatibility tests set
forth in Section 2 of Exhibit D-2. Upon Final Acceptance of the SBAS Operational
Component pursuant to Article 10.2.2, Acceptance of the SBAS Test Deliverables
shall be deemed to occur. Upon Acceptance, Contractor shall ship the SBAS Test
Deliverables to HNS-designated location within the continental U.S. or Canada.
Contractor shall be responsible for the costs of shipment to the HNS-designated
location, including the cost of transportation insurance.
10.5 DELIVERABLE DATA
Purchaser shall, within fifteen (15) Business Days of the later of (i) SBN EDC
or (ii) Delivery by Contractor to the location designated in Article 3.1 of
Deliverable Data requiring Purchaser approval pursuant to Exhibits A-1 and/or
A-2, as applicable, Statements of Work, notify Contractor in writing that such
Deliverable Data has been accepted in accordance with the applicable of Exhibits
A-1 and/or A-2 ("Acceptance" with respect to each such item of Deliverable
Data), or that such Deliverable Data does not comply with the applicable
requirements of the applicable Exhibit A-1 and/or A-2, identifying each such
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non-conformance (with reference to the applicable requirement of the applicable
Exhibit A-1 and/or A-2 deemed not met). Contractor shall promptly correct any
non-compliant aspect of such Deliverable Data identified in such notice from
Purchaser, and re-submit it to Purchaser for a second acceptance inspection
pursuant to this Article 10.5. The provisions of this Article 10.5 shall
thereafter apply to the corrected Deliverable Data. If Purchaser fails to
provide notice within the time specified, Acceptance shall be deemed to have
occurred with respect to such Deliverable Data. Deliverable Data that does not
require Purchaser approval pursuant to the applicable Statement of Work, shall
be deemed accepted upon Delivery of such Deliverable Data unless within fifteen
(15) Business Days, of the later of (i) SBN EDC or (ii) Delivery, Purchaser
notifies Contractor in writing that such Deliverable Data does not comply with
the applicable requirements of the applicable Statement of Work, identifying
each such non-conformance (with reference to the applicable requirement of the
applicable Statement of Work deemed not met). Contractor shall promptly correct
any non-compliant aspect of such Deliverable Data identified in such notice from
Purchaser and re-submit it to Purchaser for a second acceptance inspection.
Failure to provide notice within the time specified shall be deemed to be
Acceptance for such item of Deliverable Data.
10.6 TRAINING
Acceptance of Training, or any part thereof, required by Exhibits A-1 and/or
A-2, as applicable, shall occur upon Contractor furnishing Training, or such
part thereof, to Purchaser in accordance with the Delivery schedule and in a
condition conforming to the applicable Statement of Work. Any Training furnished
to Purchaser shall be accompanied by written notice from Contractor specifying
that portion of the Training being furnished. If such Training or part thereof
is unacceptable, Purchaser shall notify Contractor in writing within fifteen
(15) Business Days of completion of such Training or portion thereof, that the
Training, or part thereof, does not conform to the requirements of the
applicable Statement of Work, identifying each such non-conformance (with
reference to the applicable requirement of the applicable Statement of Work
deemed not met). Contractor shall, at its expense, promptly correct such
non-conformance and shall notify Purchaser that the corrections have been made.
The provisions of this Article 10.6 shall thereafter apply to the corrected
Training. If Purchaser fails to provide notice within fifteen (15) Business Days
of completion of Training or any part thereof, Acceptance shall be deemed to
have occurred with respect to such Training or part thereof.
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10.7 OTHER SERVICES
Acceptance of other services provided hereunder (e.g., SBAS Deliverable
Services), or any part thereof, shall occur upon Contractor furnishing such
services, or such part thereof, to Purchaser in accordance with the Delivery
schedule set forth in Article 3.1 and in a condition conforming to the
requirements of this Contract. To the extent feasible, any such services
furnished to Purchaser shall be accompanied by written notice from Contractor
specifying that portion of the services being furnished. If such services or
part thereof are unacceptable, Purchaser shall notify Contractor that the
services, or part thereof, do not conform to the requirements of Exhibits A-1
and/or A-2, as applicable, identifying each such non-conformance (with reference
to the applicable requirement of Exhibits A-1 and/or A-2 deemed not met).
Contractor shall promptly correct such non-conformance to the extent feasible
and shall notify Purchaser that the corrections have been made. The provisions
of this Article 10.7 shall thereafter apply to the corrected services.
10.8 PURCHASER'S INSPECTION AGENTS
Purchaser may, upon giving prior written notice to Contractor, cause any
Purchaser personnel, consultant or agent designated by Purchaser to observe or
conduct the acceptance inspection pursuant to this Article 10 in whole or in
part; provided, however, that the provisions of Article 7 and Article 8.5 shall
apply to any such agent and such agent shall comply with Contractor's normal and
customary safety and security regulations provided to Purchaser in writing in
advance of such inspection.
10.9 WAIVERS AND DEVIATIONS
Contractor shall submit to Purchaser any request for a waiver of, or deviation
from, provisions(s) of the Performance Specification applicable to any
Deliverable Item. A request for waiver or deviation shall be deemed granted only
if it has been approved in writing by a duly authorized representative of
Purchaser. Each such waiver or deviation approved by Purchaser shall be deemed
an amendment to the Performance Specification for such Deliverable Item,
permitting such waiver thereof, or deviation therefrom, effective on or after
the date of such approval for such Deliverable Item. Purchaser shall consider
each waiver or deviation request in good faith and shall not unreasonably
withhold its consent to any such request.
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10.10 INSPECTION COSTS BORNE BY PURCHASER
All costs and expenses incurred by Purchaser or its agents in the performance of
its inspection rights under this Article 10, including travel and living
expenses, shall be borne solely by Purchaser.
10.11 WARRANTY OBLIGATIONS
In no event shall Contractor be released from any of its warranty obligations
applicable to any Deliverable Item as a result of such Deliverable Item having
been Accepted as set forth in this Article 10.
10.12 MILESTONE SATISFACTION TEST PROCEDURE
Prior to conducting a Milestone satisfaction test associated with the SBAS Work
under the HNS Subcontract, but only with respect to any such Milestones that are
not within the scope of Work that is subject to the provisions of Article 10.2
through 10.7 hereof, Contractor shall notify Purchaser in advance in order to
permit Purchaser representatives to be present at such Milestone satisfaction
test. If the Work fails to pass any portion of such Milestone satisfaction test,
Contractor shall promptly re-perform the services and/or redesign, repair or
replace any SBAS Deliverable Item as is necessary to correct the problem, at
which time the Milestone satisfaction test, or sub-test thereof as the Parties
agree is appropriate, shall be repeated. The foregoing process shall be repeated
as necessary until such Milestone satisfaction test has been successfully
completed. Upon completion of such Milestone, Contractor shall provide Purchaser
with a Certificate of Completion stating that such system or sub-system has
passed the applicable test. Only upon Purchaser's signing of the Certificate of
Completion shall the specific system or sub-system acceptance test be deemed
completed.
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ARTICLE 11 - TRANSFER OF TITLE AND RISK OF LOSS
11.1 DELIVERABLE ITEMS OF HARDWARE
Title (free and clear of all Contractor-incurred liens and encumbrances of any
kind) and risk of loss of or damage to each Deliverable Item of hardware shall
pass from Contractor to Purchaser upon Acceptance (Preliminary Acceptance in the
case the SBAS Operational Component) of such Deliverable Item pursuant to
Article 10. Purchaser's rights in Deliverable Data are as set forth in Article
28. For the avoidance of doubt, title and risk of loss to the SBN shall transfer
as to its constituent elements of the SBAS Operational Component pursuant to
Article 10, and title and risk of loss to the Satellite shall transfer pursuant
to the Satellite Contract.
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ARTICLE 12 - SBN ACCEPTANCE PAYMENT
12.1 ON-GROUND STORAGE.
If after Satellite Pre-Shipment Review of a Satellite pursuant to the
terms of the Satellite Contract, Purchaser places such Satellite in
on-ground storage, Contractor shall not be entitled to the SBN
Acceptance Payment during the initial nine (9) months of such on-ground
storage. If Purchaser places such Satellite in on-ground storage (other
than due to causes substantially attributable to Contractor, excluding
any delay in the delivery of the SBAS Operational Component) for more
than nine (9) months, Contractor shall be paid the SBN Acceptance
Payment, commencing at the end of such nine (9) month period with the
SBN Acceptance Payment to be made at the end of month ten (10);
provided, however, such amount shall be subject to a refund as
described below. If the Satellite is launched after Purchaser has made
the SBN Acceptance Payment under this Article 12.1, such amount shall
be deemed a pre-payment of the SBN Acceptance Payment due after actual
Acceptance in accordance with Article 9.1. To the extent that, after
actual Acceptance, Contractor does not earn all or a portion of the SBN
Acceptance Payment pre-paid by Purchaser under this Article 12.1,
Contractor shall refund all or a portion of the pre-paid SBN Acceptance
Payment, as applicable, plus interest on such refund, calculated at a
rate of eight percent (8%) per annum, compounded annually, from the
time such SBN Acceptance Payment was pre-paid by Purchaser.
12.2 LOSSES ATTRIBUTABLE TO PURCHASER.
In the event of a Total Loss (as defined in the Satellite Contract)
attributable to Purchaser or its representatives, consultants or
subcontractors (including the launch agency), or due solely to causes
not attributable to Contractor or its subcontractors, occurring from
and after Intentional Ignition in connection with an Acceptance in
accordance with Article 9.1.2, Contractor shall be deemed to have
earned the corresponding SBN Acceptance Payment, to be paid promptly
upon Purchaser's receipt of the proceeds from launch and in-orbit
insurance, if any, but in no event later than eighteen (18) months
following the Total Loss, unless Purchaser has ordered TerreStar 2
under the Satellite Contract, and such Satellite has not been
terminated pursuant to such contract (or a replacement Satellite if
both TerreStar 1 and TerreStar 2 are Total Losses).
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ARTICLE 13 - WARRANTY
13.1 TERMS AND PERIOD OF WARRANTY
13.1.1 SBAS Operational Component, Test Deliverables and Spare Parts, and SBAS
Deliverable Services
A. The Parties understand and agree the SBAS Operational
Component, Test Deliverables and Spare Parts, and SBAS
Deliverable Services, will be provided by HNS pursuant to the
HNS Subcontract. As to the SBAS Operational Component, Test
Deliverables and Spare Parts, and SBAS Deliverable Services,
Contractor shall flow through to Purchaser the warranty, and
related rights and remedies, associated with such SBAS
Operational Component, Test Deliverables and Spare Parts, and
the SBAS Deliverable Services, granted by HNS under the HNS
Subcontract. Contractor shall enforce such warranty, rights
and remedies for the benefit of Contractor and Purchaser.
Contractor shall notify Purchaser of any circumstance of which
it knows, or reasonably should know, that requires enforcement
of the rights Contractor is entitled to exercise and shall
coordinate the exercising of such rights with Purchaser.
Except for the enforcement, notification and coordination
obligations set forth in this Article 13.1.1, Contractor shall
have no obligation to provide warranty coverage after Final
Acceptance of the SBAS Operation Component and/or relevant
Acceptance of Test Deliverables, Spare Parts and SBAS
Deliverable Services, nor shall Contractor have any liability
for any warranty work performed by HNS after Final Acceptance
of the SBAS Operational Component.
B. Contractor shall not (i) alter, modify or repair the SBAS
Operational Component, Test Deliverables or Spare Parts except
through HNS or as otherwise agreed by Purchaser in writing;
(ii) improperly handle, store, operate, interconnect or
install the SBAS Operational Component, Test Deliverables or
Spare Parts (provided that any such activities performed by
HNS or Purchaser, or performed in a manner otherwise approved
by HNS or Purchaser in writing, shall not be considered
"improper"); and (iii) subject the SBAS Operational Component,
Test Deliverables or Spare Parts to usage beyond the range or
normal usage for the equipment (provided that any such
activities performed by HNS or Purchaser shall not be
considered usage by Contractor). If as a result of any
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improper action by Contractor as described immediately above
in this Article 13.1.1 B, an item of the SBAS Operational
Component is damaged, and if HNS has, and exercises, a right
under the HNS Subcontract to refuse to repair such damaged
item under any then current warranty, then as Purchaser's sole
remedy, Contractor shall be responsible for repairing such
damaged item at Contractor's expense.
13.1.2 SBN. For a period of one (1) year after SBN Acceptance, Contractor
shall evaluate any anomalies occurring in at the SBN level (independent
of Satellite anomalies, which are subject to the Satellite Contract),
shall make commercially reasonable efforts to remedy such anomalies and
shall provide recommendations for additional remedial actions if
applicable; provided, however, Contractor's obligation with respect to
defects in the SBAS Operational Component, Test Deliverables, Spare
Parts or the SBAS Deliverable Services shall be limited to Contractor's
obligation to enforce the SBAS warranty against HNS in accordance with
Article 13.1.1.
13.1.3 Deliverable Data. All Deliverable Data shall conform with the
requirements of this Contract. In the event Contractor breaches this
warranty, as Purchaser's sole and exclusive remedy, Contractor shall
promptly correct the deficiencies in the Deliverable Data and re-submit
such Deliverable Data to Purchaser.
13.1.4 Disclaimer. EXCEPT AND TO THE EXTENT EXPRESSLY PROVIDED IN ARTICLES
13.1.1, 13.1.2, and 13.1.3, CONTRACTOR HAS NOT MADE NOR DOES IT HEREBY
MAKE ANY REPRESENTATION OR WARRANTY, WHETHER WRITTEN OR ORAL, EXPRESS
OR IMPLIED, INCLUDING WITHOUT LIMITATION, ANY WARRANTY OF DESIGN,
OPERATION, CONDITION, QUALITY, SUITABILITY OR MERCHANTABILITY OR
FITNESS FOR USE OR FOR A PARTICULAR PURPOSE, ABSENCE OF LATENT OR OTHER
DEFECTS, WHETHER OR NOT DISCOVERABLE, WITH REGARD TO ANY DELIVERABLE
ITEM.
13.2 NOTICE
Subject to the provisions of Article 16, if applicable, failure of Purchaser to
provide notice of anomalies or other failures, or other data and information
regarding the use and performance of Deliverable Items, as required by the
Contract, shall not be deemed a breach by Purchaser; however, Purchaser
acknowledges that such failure may limit Contractor's ability to perform its
anomaly resolution activities under the Contract.
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ARTICLE 14 - CHANGES
14.1 CHANGES REQUESTED BY PURCHASER
14.1.1 Scope. Purchaser may, in writing, request a change in the Work within
the general scope of this Contract to:
A. Order work in addition to the Work provided for herein; or
B. Modify the whole or any part of the Work provided for herein;
or
C. Direct stop Work, by one or more orders, up to an aggregate of
eighteen (18) months.
14.1.2 Response to Change Request. Contractor shall respond to any such
requested change in writing to Purchaser within thirty (30) days after
receipt of such requested change; provided, however, in the case of a
stop Work direction, Contractor shall stop Work immediately to the
extent specified by Purchaser. Contractor shall use commercially
reasonable efforts to require its subcontractors with Major
Subcontracts to agree to a stop Work provision that minimizes
Contractor's costs and is consistent with the terms of this Article
14.1.2. In the event of a stop Work, Contractor shall use commercially
reasonable efforts to mitigate costs and shall cooperate in good faith
with Purchaser in connection with actions taken by Contractor with
respect to its subcontractors. If such change request causes an
increase or decrease in the cost or the time required for completion of
the Work to be provided herein, or otherwise affects any other
provision of this Contract, such response shall provide a non-binding
preliminary estimate of the impact of the change request on the Firm
Fixed Price (including costs associated with processing of the change
request), Delivery schedules and other provisions of this Contract. Any
proposed increase to the price or extension of the Delivery schedule
shall not exceed the expected actual cost to be incurred by Contractor,
plus ten percent (10%) and the actual time required by Contractor to
implement the change. Any price or Delivery schedule adjustment shall
be reasonable and proposed in good faith. If Purchaser desires to
proceed with the change after receipt of Contractor's preliminary
estimate, Purchaser and Contractor shall cooperate and negotiate in
good faith and agree in a timely manner to equitable adjustments in the
Firm Fixed Price, Delivery schedules and other affected provisions of
this Contract, and this Contract shall be amended in writing
accordingly in accordance with Article 32.5. In the event the Parties
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fail to agree on an adjustment (upward or downward) to the Firm Fixed
Price, Delivery schedule or other affected provisions of this Contract
with respect to a requested change, then Purchaser may direct
Contractor to proceed with the requested change, Contractor shall
proceed with the directed change, the Parties shall continue to
negotiate the adjustments to the Contract, and pending completion of
such negotiations and as a condition for Contractor being obligated to
proceed with the directed change, the Parties in good faith shall agree
upon and establish a reasonable payment schedule adjustment to
compensate Contractor for the Work performed pursuant to the directed
change, which payment schedule shall be adjusted as part of the
negotiated settlement for the directed change.
14.1.3 Tolling of Payments. Notwithstanding the foregoing, in the event
Purchaser directs a stop Work, all payments due Contractor (except for
payments due and payable prior to the date of the stop Work order)
shall be tolled and shall not accrue for the duration of the stop Work
order (up to the cumulative maximum period provided in Article 14.1.1
above), except that Contractor shall be entitled in the event of a
termination under (ii) below to payment of actual direct costs incurred
as a result of the stop Work order (e.g., reasonable termination
liabilities with subcontractors and suppliers but not overhead or G&A
costs). In the event Purchaser directs a stop Work, within twelve (12)
or eighteen (18) months thereafter, as the case may be (or within such
portion of the maximum stop Work period remaining as provided in
Article 14.1.1), Purchaser shall either: (i) direct Contractor to
resume Work hereunder, and the schedule and affected terms of this
Contract shall be equitably adjusted due to such Work stoppage and the
price shall be equitably adjusted to compensate Contractor for actual
costs reasonably incurred by Contractor associated with such Work
stoppage plus a markup of ten percent (10%), such costs and markup to
be invoiced and paid pursuant to Article 5 or (ii) terminate this
Contract for convenience pursuant to Article 19. In the event Purchaser
fails to elect either (i) or (ii) above, Purchaser shall be deemed to
have elected to terminate this Contract for convenience under Article
19. For Purposes of Article 19, Purchaser's termination liability (as
may be adjusted pursuant to the foregoing) will be based on the
effective date of the stop Work order being deemed the date upon which
Contractor was given written notice of Termination for purposes of
Article 19.1.1.
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ARTICLE 15 - FORCE MAJEURE
15.1 FORCE MAJEURE DEFINED
15.1.1 Definition. Contractor shall not be responsible for late Delivery,
delay of the final completion date or nonperformance of its contractual
obligations due to Force Majeure. Subject to Article 15.1.2, Force
Majeure shall be any event beyond the reasonable control of Contractor
or its suppliers and subcontractors and shall include, but not be
limited to: (1) acts of God; (2) acts of a public enemy; (3) acts of a
government in its sovereign or contractual capacity (including any
action or inaction affecting the import or export of items); (4) war
and warlike events; (5) catastrophic weather conditions such as
hurricanes, tornadoes and typhoons; (6) fire, earthquakes, floods,
epidemics, quarantine restrictions, (7) strikes, lockouts and other
industrial disputes (other than at the facilities of Contractor); (8)
sabotage, riot and embargoes; (9) reserved; (10) technical problems
generally affecting the commercial telecommunications industry; and
(11) other unforeseen and extraordinary events ("Force Majeure");
provided written notice is given to Purchaser, in writing, within ten
(10) Business Days after Contractor's performance has been impacted by
the occurrence of such Force Majeure and further provided such Force
Majeure is not caused by the failure of Contractor or its suppliers or
subcontractor to perform their obligations under this Contract.
Notwithstanding the foregoing, in no event will financial hardship or
insolvency of Contractor or any of its respective affiliates constitute
Force Majeure. Such notice to be provided by Contractor, as required by
the preceding provisions, shall include a detailed description of the
portion of the Work known to be affected by such delay. In coordination
with Purchaser and subject to Purchaser's prior written approval (not
to be unreasonably withheld, delayed or conditioned) where reasonably
appropriate under the circumstances, Contractor shall use best
reasonable efforts to avoid or minimize and/or work around such delay
through the implementation of any work-around plans, alternate sources,
or other means Contractor may reasonably utilize to minimize a delay in
performance of the Work. Contractor shall also provide Purchaser prompt
written notice when the event constituting Force Majeure appears to
have ended.
15.1.2 Force Majeure Definitions with Respect to HNS. Notwithstanding anything
to the contrary in this Article 15, a Force Majeure event shall arise
in the event of HNS's inability to perform, or delay in performance,
under the HNS Subcontract only when both of the following circumstances
exist:
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(i) acts of war, domestic and/or international terrorism,
civil riots or rebellions, epidemic, quarantines,
embargoes and other similar unusual governmental
actions and extraordinary elements of nature or acts
of God delay performance of HNS's obligation, and
(ii) such delay could not have been prevented through
HNS's reasonable precautions or commercially
acceptable processes, or could not have been
reasonably circumvented through the use of substitute
services, alternate sources, work-around plans or
other means by which the requirements of a buyer of
services substantially similar to the Work to be
provided under the HNS Subcontract would be
satisfied.
In addition, with respect to HNS's performance, Force
Majeure events do not include and cannot be caused by
labor strikes, lockouts, or other labor disturbances,
or the non-performance of subcontracts or other third
parties relied on or otherwise engaged by HNS, except
to the extent such HNS subcontractor's
non-performance is itself the result of a Force
Majeure event applicable to HNS.
15.1.3 Force Majeure Dispute. In the event Purchaser disputes any Force
Majeure, Purchaser shall inform Contractor in writing within ten (10)
Business Days from the date of receipt of written notice of the event
purportedly constituting the Force Majeure and, if the Parties have not
resolved the Dispute within ten (10) Business Days of Contractor's
receipt of such written notice from Purchaser, the Dispute shall be
resolved pursuant to Article 22.
15.2 EQUITABLE ADJUSTMENTS
15.2.1 Equitable Adjustment. Upon the occurrence of Force Majeure that causes
a delay in Contractor's performance of its obligations hereunder, an
equitable adjustment shall be negotiated in the Delivery schedules and
other portions of this Contract affected by Force Majeure; provided,
however, Contractor acknowledges and agrees, there shall be no
adjustment to the Firm Fixed Price due to Force Majeure.
15.2.2 Amendment. Any adjustment made pursuant to this Article 15.2 shall be
formalized by the execution of an amendment to this Contract in
accordance with Article 32.5 wherein such adjustments shall be
recorded.
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15.3 MAXIMUM FORCE MAJEURE
If the total aggregate amount of Force Majeure for any reason causes a delay in
Contractor's performance of its obligations hereunder that exceeds one year or
is reasonably certain to exceed one year or Contractor notifies Purchaser that
such total aggregate is reasonably certain to exceed one year, then the
provisions of Article 21.3 shall apply.
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ARTICLE 16 - PURCHASER DELAY OF WORK
If the performance of all or any part of the Work required of Contractor under
this Contract is delayed or interrupted by Purchaser's failure to perform its
contractual obligations hereunder within the time specified in this Contract or
within a reasonable time if no time is specified, or by an act or failure to act
of Purchaser that unreasonably interferes with and delays Contractor's
performance of its obligations under this Contract ("Purchaser Delay"),
Contractor shall be entitled to an equitable adjustment in the Firm Fixed Price,
performance requirements, Delivery schedule, and any other terms of this
Contract affected by such act or failure to act of Purchaser, provided, however,
there shall be an adjustment to the Firm Fixed Price only for actual costs
reasonably incurred by Contractor as a result of such Purchaser Delay, plus a
markup of ten percent (10%) of such costs, such costs and markup to be invoiced
and paid pursuant to the provisions of Article 5. Contractor shall provide
Purchaser written notice as soon as reasonably practicable after Contractor's
performance has been impacted by a Purchaser Delay. Any adjustment made pursuant
to this Article 16 shall be formalized by the execution of an amendment to this
Contract in accordance with Articles 14 and 32.5 wherein such adjustments shall
be recorded. At Purchaser's written request pursuant to Article 14, Contractor
shall use best reasonable efforts to avoid or minimize and/or work around any
delay resulting from such Purchaser Delay through the implementation of any
work-around plans, alternate sources, or other means Contractor may utilize or
expect to utilize to minimize a delay in performance of the Work.
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ARTICLE 17 - INTELLECTUAL PROPERTY INDEMNITY
17.1 INDEMNIFICATION
Contractor, at its own expense, hereby agrees to defend or, at Contractor's sole
option, to settle, and to indemnify and hold harmless Purchaser and its
Affiliates, and their respective officers, directors, employees, shareholders,
and agents from and against any claim or suit based on, arising from, or in
connection with any allegation that the manufacture of any Deliverable Item or
any part thereof or the normal intended use, lease or sale of any Deliverable
Item or any part thereof infringes any third party Intellectual Property Right
("Intellectual Property Claim"), and shall pay any royalties and other
liabilities adjudicated (or provided in settlement of the matter) to be owing to
the third party claimant as well as costs and expenses incurred in defending or
settling (including court costs and reasonable attorneys' fees and
disbursements, costs of investigation, expert fees, litigation, settlement,
judgment, interest and penalties) such Intellectual Property Claim. Contractor's
obligations under this Article 17.1 shall be subject to the conditions to
indemnification set forth in Article 18.3.
17.2 INFRINGING EQUIPMENT
Subject to the limitations set forth in Article 17.1, if the manufacture of any
Deliverable Item or the normal intended use, lease or sale of any Deliverable
Item under this Contract is enjoined as a result of an Intellectual Property
Claim or is otherwise prohibited, Contractor shall at its option and expense:
(i) resolve the matter so that the injunction or prohibition no longer pertains;
(ii) procure for Purchaser the right to use the infringing item; and/or (iii)
modify the infringing item so that it becomes non-infringing while remaining in
compliance with the Performance Specification (as may be modified or waived
pursuant to Article 10.9). Purchaser shall reasonably cooperate with Contractor
to mitigate or remove any infringement. If Contractor is unable to accomplish
(i), (ii) or (iii) as stated above, Purchaser shall have the right to terminate
this Contract in whole or in part, with respect to such Deliverable Item (and
any other Deliverable Item whose utility has been adversely impacted by
Purchaser's loss of use of the infringing Deliverable Item), return such
Deliverable Item(s) to Contractor, and receive a refund of the price paid for
such terminated Deliverable Item(s) less: (a) amounts unpaid for such item; and
(b) a reasonable allowance for use and depreciation.
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17.3 COMBINATIONS AND MODIFICATIONS
Contractor shall have no liability under this Article 17 for any Intellectual
Property Claim arising solely from: (i) use of any Deliverable Item in
combination with other items not provided, recommended, or approved by
Contractor or its suppliers or subcontractors; or (ii) modifications of any
Deliverable Item after Delivery by a person or entity other than Contractor (or
its suppliers or subcontractors acting through Contractor) unless such
modification, (A) was made by such other person or entity due to Contractor's
failure to perform a contractual obligation hereunder (except where Contractor
believes such modification would result in an infringement of a third party's
rights), or (B) is authorized by written directive or instructions furnished by
Contractor to Purchaser under this Contract; or (iii) the manufacture, Delivery
or use of any Deliverable Item in compliance with the design, specification or
instructions of Purchaser.
17.4 SOLE REMEDIES
The remedies set forth in this Article 17 are Purchaser's sole and exclusive
remedies for or related to any Intellectual Property Claim.
17.5 SBAS
Notwithstanding the foregoing, as to the SBAS, Contractor's only obligation and
liability under this Article 17 is to use reasonable best efforts to seek and
obtain relief and recovery through HNS, but Contractor shall have no independent
liability to provide any remedy or recovery described in this Article 17
regarding the SBAS.
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ARTICLE 18 - INDEMNITY FOR PERSONAL INJURY AND PROPERTY DAMAGE
18.1 CONTRACTOR'S INDEMNITY
Contractor, at its own expense, shall defend, indemnify and hold harmless
Purchaser and its Affiliates and their respective directors, officers,
employees, shareholders, and agents, from and against any losses, damages, and
other liabilities, adjudicated (or provided for in settlement of the matter) to
be owing to the claimant as well as costs and expenses (including court costs,
and reasonable attorneys' fees and disbursements, costs of investigation, expert
fees, litigation, settlement, judgment, interest and penalties) (collectively,
"Losses") based on, arising from or in connection with any allegations by third
parties regarding any of the following: (i) claims for injury to persons or
property damage, but only if such Losses were caused by, or resulted from, a
negligent act or omission or willful misconduct of Contractor or its employees
or representatives; provided, however, that in the event that an Affiliate of
Purchaser sues Purchaser as a result of a claim arising in connection with the
SBN Work, such action shall not be deemed to be such a third party claim subject
to indemnification; and (ii) Contractor's breach of its obligations under
Article 7. For the avoidance of doubt, Contractor shall have no indemnity
obligations pursuant to this Article 18 or Article 20 of the Satellite Contract
for any Losses with respect to a Satellite after Intentional Ignition of the
Launch Vehicle for such Satellite, unless and to the extent of a Terminated
Ignition as provided in Article 12.1 of the Satellite Contract, even if such
Losses are attributable, in whole or in part, to an act or omission of
Contractor or its employees, representatives, contractors or subcontractors at
any tier (including suppliers of any kind) prior to Intentional Ignition.
18.2 PURCHASER'S INDEMNITY
Purchaser, at its own expense, shall defend, indemnify and hold harmless
Contractor and its Affiliates, and their respective directors, officers,
employees, shareholders and agents, from and against any Losses based on,
arising from or in connection with any allegations by third parties regarding
any of the following: (i) for claims for injury to persons or property damage,
but only if such Losses were caused by, or resulted from, negligent acts or
omissions or willful misconduct of Purchaser or its employees or representatives
and (ii) Purchaser's breach of its obligations under Article 7.
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18.3 CONDITIONS TO INDEMNIFICATION
The right to any indemnity specified in Article 18.1 and Article 18.2 shall be
subject to the following conditions:
18.3.1 Notice. The Party seeking indemnification shall promptly advise the
other Party in writing of the filing of any suit or of any written or
oral claim for which it seeks indemnification upon receipt thereof and
shall provide the other Party, at its written request, with copies of
all documentation relevant to such suit or claim. Failure to so notify
the indemnifying Party shall not relieve the indemnifying Party of its
obligations under this Contract except to the extent it can demonstrate
that it was prejudiced by such failure. Within fifteen (15) days
following receipt of written notice from the Party seeking
indemnification relating to any claim, but no later than a reasonable
time before the date on which any response to a complaint or summons is
due, the indemnifying Party shall notify the Party seeking
indemnification in writing if the indemnifying Party elects to assume
control of the defense or settlement of that claim (a "Notice of
Election") when not contrary to the governing rules of procedure.
18.3.2 Control of Action. If the indemnifying Party delivers a Notice of
Election relating to any claim within the required notice period, so
long as it is actively defending such claim, the indemnifying Party
shall be entitled to have sole control over the defense and settlement
of such claim; provided that (i) the Party seeking indemnification
shall be entitled to participate in the defense of such claim and to
employ counsel (reasonably acceptable to the indemnifying Party) at its
own expense to assist in the handling of such claim provided there is
no conflict of interest and that such participation would not adversely
affect the conduct of the proceedings; (ii) where the Party seeking
indemnification is so represented, the indemnifying Party shall keep
counsel of the Party seeking indemnification informed of each step in
the handling of any such claim; and (iii) the Party seeking
indemnification shall provide, at the indemnifying Party's request and
expense, such assistance and information as is available to the Party
seeking indemnification for the defense and settlement of such claim
and (iv) the indemnifying Party shall notify the Party seeking
indemnification before entering into any non-monetary settlement of
such claim or ceasing to defend against such claim. After the
indemnifying Party has delivered a Notice of Election relating to any
claim in accordance with the preceding paragraph, the indemnifying
Party shall not be liable to the Party seeking indemnification for any
legal expenses incurred by the Party seeking indemnification in
connection with the defense of that claim. In addition, the
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indemnifying Party shall not be required to indemnify the Party seeking
indemnification for any amount paid or payable by the Party seeking
indemnification in the settlement of any claim for which the
indemnifying Party has delivered a timely Notice of Election if such
amount was agreed to without the prior written consent of the
indemnifying Party.
18.3.3 Right of Indemnified Party to Defend/Settle. If the indemnifying Party
does not deliver a Notice of Election relating to any claim within the
required notice period or fails actively to defend such claim, the
Party seeking indemnification shall have the right to defend and/or
settle the claim in such manner as it may deem appropriate, at the cost
and expense of the indemnifying Party. Provided that the Party seeking
indemnification acts in good faith, it may settle such claim on any
terms it considers appropriate under the circumstances without in any
way affecting its right to be indemnified hereunder. The indemnifying
Party shall promptly reimburse the Party seeking indemnification for
all such costs and expenses.
18.4 WAIVER OF SUBROGATION
Each Party shall use best reasonable efforts to obtain a waiver of subrogation
and release of any right of recovery against the other Party and its Affiliates,
contractors and subcontractors at any tier (including suppliers of any kind) and
their respective directors, officers, employees, shareholders and agents, that
are involved in the performance of this Contract from any insurer providing
coverage for the risks such Party has agreed to indemnify against under this
Article 18.
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ARTICLE 19 - TERMINATION FOR CONVENIENCE
19.1 REIMBURSEMENT OF CONTRACTOR
19.1.1 Right to Terminate. Purchaser may terminate this Contract without
cause, in whole or in part, by giving Contractor written notice thirty
(30) days prior to the date of such termination. In the event of such
termination, Contractor will cease Work as directed in the termination
notice
19.1.2 Termination for HNS Investment in Competing Business. Purchaser may
terminate this Contract as to the SBAS (including SBAS Deliverable
Services) without liability other than for payment of any Milestones in
Exhibit E-1, SBAS Program Payment Plan, completed as of the date of
termination, upon thirty (30) days' notice, if HNS merges with or is
acquired by an entity that owns a Competing Satellite System, or if HNS
acquires a greater than ten percent (10%) interest in a Competing
Satellite System; or if HNS enters into a Joint Venture (defined below)
or other substantially comparable arrangement with a Competing
Satellite System. Contractor shall immediately notify Purchaser in the
event it becomes aware of any of the foregoing circumstances, and
Contractor shall require HNS to notify Contractor of any such
circumstances. For purposes of this Article, a "Joint Venture" means an
entity joint venture in which HNS has a material equity interest.
19.1.2 Termination of Satellite Contract. In the event that Purchaser
terminates the Satellite Contract pursuant to Article 21 of the
Satellite Contract (Termination for Convenience), Purchaser shall be
deemed to have terminated this Contract in whole pursuant to this
Article 19.
19.1.3 Termination Liability
A. Termination in Whole. If Purchaser terminates this Contract in
whole pursuant to this Article 19, Contractor shall be
entitled to payment of an amount equal to the sum of (i) the
sum of all successfully completed Milestones set forth in
Section 2.0 of Exhibit E-1, SBAS Program Payment Plan, as of
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the date of termination, plus all reasonable costs incurred by
HNS (including HNS's third party costs) in respect to the
terminated work plus ten percent (10%) of such amount; plus
(ii) the termination liability amount applicable as of the
effective date of termination, as specified in Exhibit E-2,
SBN Program Payment Plan and Termination Liability Amount;
less the sum of all amounts previously paid under this
Contract.
B. Termination of the SBAS in Whole.
(i) In the event that Purchaser terminates this Contact
in respect to the entirety of the SBAS, or any
significant portion thereof, under this Article 19,
Purchaser shall be deemed to have also terminated the
SBN and SBN Work in its entirety pursuant to this
Article 19, unless Purchaser agrees to provide the
terminated SBAS Deliverable Items as CFE on terms
approved by Contractor, which approval shall not be
unreasonably withheld, conditioned or delayed.
(ii) In the event Purchaser terminates the SBAS in its
entirety pursuant to this Article 19, Purchaser shall
pay to Contractor an amount equal to the sum of the
sum of the actual costs incurred by HNS in
performance of Work on the SBAS (including SBAS
Deliverable Services, if applicable) that have not
been completed prior to such termination plus ten
percent (10%) of such costs, not to exceed the SBAS
Firm Fixed Price, pro-rated to reflect the portion of
work-in-process, plus actual costs incurred by HNS
(including HNS's third party costs) in connection
with such SBAS termination, provided that Contractor
shall require HNS to use reasonable efforts to
minimize such costs, less all amounts paid under
Exhibit E-1, SBAS Program Payment Plan, provided that
in no event shall the total termination liability for
the SBAS exceed the SBAS Firm Fixed Price less all
amounts paid under Exhibit E-1, SBAS Program Payment
Plan.
C. Termination of the SBN and SBN Work in Whole. In the event
Purchaser terminates the SBN in its entirety pursuant to this
Article 19, Purchaser shall pay to Contractor an amount equal
to the termination amount applicable as of the effective date
of termination, as specified in Exhibit E-2 (as adjusted in
accordance with Article 33.1.8); provided, however, that if
the SBN is terminated as a result of the SBAS being terminated
for default in connection with, or following, SBAS Operational
Component Preliminary Acceptance, such termination liability
shall be reduced by the percentage reduction specified in
Tables A-D in Article 9.1.4 based on the analyzed performance
of the SBN utilizing the actual performance measurements of
the SBAS Operational Component at the time of such
termination.
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D. Termination in Part. In the event Purchaser terminates the
SBAS or SBN and SBN Work in part pursuant to this Article 19,
Purchaser shall pay to Contractor an amount equal to the sum
of: (i) if the SBAS (including SBAS Deliverable Services) is
terminated in part, the sum of the actual costs incurred by
HNS in performance of Work on the SBAS (including SBAS
Deliverable Services, if applicable) that have not been
completed prior to such termination plus ten percent (10%) of
such costs, not to exceed the SBAS Firm Fixed Price, pro-rated
to reflect the portion of work-in-process, plus actual costs
incurred by HNS (including HNS's third party costs) in
settling claims of subcontractors and other suppliers and
vendors in connection with such SBAS termination, provided
that Contractor shall require HNS to use reasonable efforts to
minimize such costs, less all amounts paid under Exhibit E-1,
SBAS Program Payment Plan, provided that in no event shall the
total termination liability for the SBAS exceed the SBAS Firm
Fixed Price less all amounts paid under Exhibit E-1, SBAS
Program Payment Plan; plus (ii) if the SBN and SBN Work are
terminated in part, the termination liability amount
applicable as of the effective date of termination is sum of
(1) through (5) below less any amounts previously paid with
respect to completed and/or terminated Deliverable Items:
1. The price set forth in Article 4 for Deliverable
Items completed prior to such termination therefor
whether or not Delivery has occurred with respect to
such Deliverable Item; and
2. Actual costs incurred by Contractor in performance of
Work on Deliverable Items for which this Contract has
been terminated pursuant to this Article 19.1.3 D,
that have not been completed prior to such
termination; and
3. Actual costs incurred by Contractor in completing the
termination process; and
4. Actual costs incurred by Contractor in settling
claims of subcontractors and other suppliers and
vendors in connection with such termination; provided
that Contractor shall use reasonable efforts to
minimize such costs; and
5. A fifteen percent (15%) profit on items (1) - (4)
above.
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If the termination by Purchaser is partial and as a
result thereof Contractor will incur additional costs
for the portion of the Work not terminated, then
Contractor shall be entitled to an equitable
adjustment in accordance with Article 14.1.2.
E. Termination Settlement Meeting. In the event of a termination
pursuant to this Article 19, a termination settlement meeting
shall be held at a mutually agreed time and place no later
than sixty (60) days after submission of a claim by Contractor
pursuant to Article 19.1. At or prior to the date of such
termination settlement meeting, Contractor shall provide
Purchaser with such documentation of the termination liability
amounts permitted above as Purchaser may reasonably request.
Upon completion of the termination settlement meeting,
Contractor may submit an invoice to Purchaser for payment in
accordance with the terms of Article 5.
F. Maximum Liability. In no event shall the amounts payable
pursuant to this Article 19 exceed the SBAS Firm Fixed Price
as reflected in Item 1 of Article 4.1.1 hereof, plus (if the
SBN and SBN Work is also terminated by operation of this
Article 19) the Firm Fixed Price of the SBN and SBN Work as
reflected in Item 2 of Article 4.1.1 hereof.
G. Limitation on Right to Terminate. Notwithstanding the
foregoing, Purchaser shall have no right to terminate for
convenience as to any Deliverable Item hereunder from and
after such time as such Deliverable Item has been completed
and is ready for Delivery.
19.2 DISPOSITION OF WORK
Upon payment by Purchaser to Contractor of the termination liability amounts due
under Article 19.1, subject to applicable U.S. Government export laws and
license conditions, Purchaser may require Contractor to transfer title and risk
of loss to Purchaser to any part of the Deliverable Items (including any
associated Raw Materials, Work-in-Process and Finished Goods) terminated
pursuant to this Article 19 and Contractor shall, upon direction of Purchaser,
protect and preserve property at Purchaser's expense in the possession of
Contractor or its subcontractors in which Purchaser has an interest and shall
facilitate access to and possession by Purchaser of items comprising all or part
of the Work terminated. Alternatively, Purchaser may request Contractor to make
a reasonable, good faith effort to sell such items and to remit any sales
proceeds to Purchaser less a deduction for actual costs of disposition
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reasonably incurred, and any Security Interest or other right or interest that
Purchaser has in such items shall be released and extinguished, and Purchaser
shall take all action reasonably requested by Contractor to terminate any
document or instrument filed of record (including without limitation UCC
financing statements) to perfect any such Security Interest.
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ARTICLE 20 - LIQUIDATED DAMAGES FOR LATE DELIVERY
20.1 SBAS OPERATIONAL COMPONENT
20.1.1 Late Delivery of the SBAS Operational Component. The Parties
acknowledge and agree that failure to meet the SBAS Operational
Component Delivery schedule specified therefor in Article 3.1 will
cause substantial financial loss or damage being sustained by
Purchaser. The following liquidated damages are believed to represent a
genuine and reasonable estimate of all losses (including non-productive
time and increased cost of money) that would be suffered by Purchaser
by reason of any such delay (which losses would be difficult or
impossible to calculate with certainty).
20.1.2 Liquidated Damages for Late Delivery the SBAS Operational Component. If
any SBAS Key Milestone identified immediately below is not completed
within thirty (30) calendar days after the schedule date for completion
specified therefor in Exhibit E-1, SBAS Program Payment Plan (as such
dates may be adjusted pursuant to Articles 14, 15 or 16), then
Contractor shall pay Purchaser an amount, not to exceed in the
cumulative total, [***]percent ([***]%) of the SBAS Firm Fixed Price as
set forth in Article 4.1.1, Item 1, (as such may be modified in
accordance with the provisions of this Contract), as specified below,
as liquidated damages and not a penalty for each calendar day of delay
after the thirty (30) calendar day grace period following the Key
Milestone Date associated with Contractor's late Delivery:
-------------------------------------------------------------------
Key Milestone Delayed Amount Maximum Amount
per Day (Percentage of the
SBAS Firm Fixed
Price)
-------------------------------------------------------------------
1. [***] US$[***] [***]%
-------------------------------------------------------------------
2. [***] US$[***] [***]%
-------------------------------------------------------------------
3. [***] US$[***] [***]%
-------------------------------------------------------------------
4. [***] US$[***] [***]%
-------------------------------------------------------------------
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20.2 OFFSET
Any amounts due in accordance with this Article 20 shall be, at Purchaser's
election, either (i) credited to Purchaser against any outstanding or future
invoices hereunder or (ii) paid by Contractor to Purchaser within thirty (30)
days of issuance of an invoice from Purchaser.
20.3 REMEDY
Such damages shall be Purchaser's sole remedy and compensation for Contractor
delays with respect to late Delivery of the SBAS during the time period set
forth above; provided, however, Purchaser retains all rights and remedies under
Article 19 regarding termination for convenience and Article 21.3 regarding
termination for excessive force majeure.
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ARTICLE 21 - TERMINATION FOR DEFAULT AND EXCESSIVE FORCE MAJEURE
21.1 PURCHASER RIGHT OF TERMINATION
21.1.1 Right to Terminate
A. Subject to extensions of time due to Article 15 and Article 16
and, in addition, subject to Article 21.1.4 below, Purchaser
may terminate this Contract in whole or in part by written
notice to Contractor if (i) Purchaser terminates the Satellite
Contract for default (in accordance with the terms of the
Satellite Contract); (ii) Contractor commits a material breach
of this Contract (other than failure to meet any scheduled
Delivery due hereunder, without prejudice to Purchaser's
rights under Article 21.1.1B, or as set forth in Article
21.1.1C) and fails, within ninety (90) days (or such longer
period as may be agreed to in writing by Purchaser) after
receipt from Purchaser of written notice thereof, to cure such
material breach; or (iii) Contractor commences a voluntary
proceeding under the Bankruptcy Code after SBN EDC or any
other applicable bankruptcy, insolvency, reorganization,
adjustment of debt, relief of debtors or similar laws (each an
"Insolvency Law"); or an involuntary proceeding against
Contractor under an Insolvency Law has been commenced and the
petition has not been dismissed within ninety (90) days after
the commencement of the proceeding; or a receiver or custodian
is appointed for or takes charge of all or a substantial
portion of property of the Contractor and such custodian or
receiver has not been dismissed or discharged within ninety
(90) days; or Contractor has taken action toward the
winding-up, dissolution or liquidation of the Contractor; or,
other than the Bankruptcy Case, Contractor has been
adjudicated insolvent or bankrupt or an order for relief or
any other order approving a case or proceeding under any
Insolvency Law has been entered; or Contractor has made a
general assignment for the benefit of creditors or becomes
unable to pay its debts generally as they become due.
B. In addition, Purchaser may terminate this Contract, in part
for default, with respect to the HNS Subcontracted Work if:
(i) any Milestone set forth in Section 2 of Exhibit E-1, SBAS
Program Payment Plan, is not successfully completed within
sixty (60) days after the date the Milestone is schedule for
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completion therein or (ii) HNS becomes insolvent, makes a
general assignment for the benefit of creditors, suffers or
permits the appointment of a receiver for its business or
assets or files a voluntary petition in bankruptcy, or is the
subject to a petition seeking the reorganization, liquidation
or similar relief, where such petition remains undismissed or
unstayed for a total of sixty (60) days.
For the avoidance of doubt, a "material breach" under
subclause (ii) of Article 21.1.1 A, shall not include grounds
for termination set forth in Article 21.1.1 B.
In the event of a termination under this Article 21.1.1 B, the
SBN and SBN Work shall be deemed to be terminated for
convenience in whole and the provisions of Article 19 shall
apply, unless Purchaser agrees to provide the SBAS and other
terminated HNS Subcontracted Work as CFE on terms approved by
Contractor, which approval shall not be unreasonably withheld,
conditioned or delayed.
C. In addition, Purchaser may, prior to Intentional Ignition for
Launch of the Satellite (as defined in the Satellite
Contract), terminate this Contract, in part for default, with
respect to the SBN and SBN Work as defined in Item 2 in
Article 3.1 (but not the SBAS or any other Deliverable Item
other than the SBN and SBN Work) if Contractor commits a
material breach with respect to the SBN and/or SBN Work, and
fails, within ninety (90) days (or such longer period as may
be agreed to in writing by Purchaser) after receipt from
Purchaser of written notice thereof, to cure such material
breach.
21.1.2 Termination Liability. In the event of termination pursuant to this
Article 21.1, subject to Article 21.1.3:
(i) if the termination is pursuant to Article 21.1.1 A,
Purchaser shall be entitled to a refund by Contractor
of all payments made by Purchaser for the terminated
Work associated with the SBN and SBN Work plus
interest thereon at the interest rate stipulated in
Article 5.3.1 hereof from the date payment was
received to the date the refund is received
(provided, however, in the case of termination in
part, the Parties shall negotiate an equitable refund
amount to be paid by Contractor to Purchaser for the
portion of the Work so terminated); plus an
assignment to the Purchaser of the HNS Subcontract
for the SBAS and other Deliverable Items and HNS
Subcontracted Work specified therein;
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(ii) if the termination is pursuant to Article 21.1.1 B,
Contractor shall apply best reasonable efforts to
enforce and obtain the benefits of the remedies
provided in the HNS Subcontract and shall pay
Purchaser any amounts awarded to, and received by,
Contractor or obtained by Contractor in settlement
(however, Contractor shall not settle any dispute or
agree to any payment without Purchaser's prior
written approval, which Purchaser shall not
unreasonably deny, delay or withhold); or
(iii) if the termination is pursuant to Article 21.1.1 C,
Purchaser shall be entitled to a refund by Contractor
of all payments made by Purchaser pursuant to Exhibit
E-2, SBN Program Payment Plan and Termination
Liability Amounts, for the terminated Work associated
with the SBN and SBN Work. In addition, if the
termination is pursuant to Article 21.1.1 A or B,
Purchaser shall be entitled to payment of any
liquidated damages for delay of a terminated SBAS
Operational Component which accrued prior to the
effective date of termination pursuant to Article 20.
Contractor shall pay the foregoing amounts no later
than thirty (30) days after Contractor's receipt of
Purchaser's written notice requesting such amounts.
Payment of such amounts shall be Purchaser's sole
remedy in case of a termination pursuant to this
Article 21.1. Upon payment in full of all amounts due
in accordance with the preceding sentences of this
Article 21.1.2, any Security Interest or other right or
interest that Purchaser has in the terminated
Deliverable Items, Raw Materials, Work-in-Process and
Finished Goods (except with respect to Deliverable
Items retained by Purchaser pursuant to Article 21.1.3)
hereunder or otherwise shall be released and
extinguished and Purchaser shall take all action
reasonably requested by Contractor to terminate any
document or instrument filed of record (including
without limitation UCC financing statements) to perfect
any such Security Interest.
21.1.3 Contractor's Reimbursement for Terminated Work. Except as provided in
this Article 21 with respect to a termination of the HNS Subcontracted
Work, in the event of termination pursuant to this Article 21.1.1 A or
C, Contractor shall refund amounts paid by Purchaser under this
Contract as provided above, except Contractor shall not be required to
refund any amounts, and Purchaser shall remain liable for payment of
all amounts with respect to Raw Materials, Work-in-Process and Finished
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Goods (including Deliverable Items for which Acceptance has not
occurred) which Purchaser has requested to retain, as follows: (i) at
the price set forth in this Contract for such items for which an
itemized price is set forth herein and (ii) at the actual cost incurred
by Contractor, plus a markup of ten percent (10%) of such cost, for (a)
such items for which no itemized price is set forth herein and (b)
partially completed items and Work-in-process. Subject to Purchaser
making payment to Contractor of any unpaid balance of amounts due in
accordance with the immediately preceding sentence, Contractor shall
transfer to Purchaser in the manner and to the extent directed by
Purchaser title and risk of loss to such Deliverable Items, Raw
Materials, Work-in-Process and Finished Goods.
21.1.4 Special Provision Limiting Purchaser's Remedies. Purchaser shall have
no right to terminate this Contract pursuant to this Article 21.1 with
respect to the SBAS Operational Component after Final Acceptance of the
SBAS Operational Component pursuant to Article 10.2 or with respect to
the SBN and SBN Work after Intentional Ignition for Launch of the
Satellite as described in the Satellite Contract. Purchaser's sole
remedy with respect to delays in Delivery shall be as specified in
Article 20 and this Article 21.1. Purchaser's sole right to terminate
this Contract for Contractor's default shall be as specified in this
Article 21.1.
21.1.5 Disposition of the Work. Unless and to the extent that Purchaser
retains Deliverable Items or portions thereof pursuant to Article
21.1.3 hereof, upon payment in full of all amounts due in accordance
with Article 21.1.2, any Security Interest or other right or interest
that Purchaser has in such items (except with respect to Deliverable
Items retained by Purchaser pursuant to Article 21.1.3) hereunder or
otherwise shall be released and extinguished and Purchaser shall take
all action reasonably requested by Contractor to terminate any document
or instrument filed of record (including without limitation UCC
financing statements) to perfect any such Security Interest.
21.1.6 Invalid Default Termination. If, after termination pursuant to this
Article 21.1, it is finally determined pursuant to Article 22 or
written agreement of Purchaser that Contractor was not in default under
Article 21.1.1, or that the default was excusable under Articles 15 or
16, the rights and obligations of the Parties shall be the same as if
the termination had occurred under Article 19; except that Contractor
shall also be entitled to recover its additional actual costs
reasonably incurred due to such invalid default termination plus a
markup of ten percent (10%) of such costs.
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21.2 CONTRACTOR RIGHT OF TERMINATION
21.2.1 Right to Terminate. Contractor may terminate this Contract only upon
written notice to Purchaser if Purchaser fails to cure any default in
the payment of any amount that has become due and payable hereunder
within sixty (60) days after receiving written notice of such default
(or such longer period as may be agreed to in writing by Contractor),
subject to Purchaser's right to issue a stop Work in accordance with
Section 14.1. Purchaser's issuance of a stop Work shall have the effect
of extending the cure period set forth herein during the term of the
stop Work. Notwithstanding Article 21.2, Purchaser will not be
considered in default with respect to any amount that it is disputing
in good faith pursuant to Article 5.6 (and that has been deposited in
an escrow account pursuant to such Article) and will have thirty (30)
Business Days after the final resolution (by agreement or arbitration)
of such dispute to satisfy any payment required by such resolution.
Contractor may not terminate this Contract under any circumstance,
including for Purchaser's breach of any obligation, except as set forth
in this Article 21.1.
21.2.2 Termination Liability. In the event of termination pursuant to this
Article 21.2, Contractor shall be paid as if such termination were for
convenience pursuant to Article 19. Further, if Purchaser's failure to
perform is a failure to pay Contractor invoiced amounts when due,
Contractor shall be entitled to late payment interest pursuant to
Article 5.3.1. Payment of any amount by any Financing Entity on behalf
of Purchaser shall relieve Purchaser from its obligation to make such
payment in the corresponding amount. Payment of the total amounts
(termination for convenience amounts plus interest on outstanding
invoices) payable by Purchaser pursuant to this Article 21.2.2 shall
constitute a total discharge of Purchaser's liabilities to Contractor
for termination pursuant to this Article 21.2.
21.2.3 Disposition of the Work. Contractor may elect immediately upon
termination to take over all Deliverable Items and Raw Materials,
Work-in-Process and Finished Goods and use or dispose of the same in
any manner Contractor may elect, and any Security Interest or other
right or interest that Purchaser has in such items hereunder or
otherwise shall be released and extinguished and Purchaser shall take
all action reasonably requested by Contractor to terminate any document
or instrument filed of record (including without limitation UCC
financing statements) to perfect any such Security Interest. In such
case, the fair market value of any Deliverable Items or Deliverable
Items, Raw Materials, Work-in-Process and Finished Goods used or
disposed of by Contractor shall be set-off against Purchaser's
termination liability under Article 21.2.2. Upon completion of all
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payments to Contractor in accordance with Article 21.2.2, Purchaser may
require Contractor to transfer title and risk of loss to Purchaser to
such Deliverable Items, Raw Materials, Work-in-Process and Finished
Goods. In lieu of taking immediate possession of Deliverable Items, Raw
Materials, Work-in-Process and Finished Goods as provided in the
preceding sentence, upon direction of Purchaser, Contractor shall
protect and preserve Deliverable Items, Raw Materials, Work-in-Process
and Finished Goods at Purchaser's expense and shall facilitate access
to and possession by Purchaser to such Deliverable Items, Raw
Materials, Work-in-Process and Finished Goods.
Alternatively, Purchaser may request Contractor to make a reasonable,
good faith effort to sell such items and to remit any sales proceeds to
Purchaser less a deduction for actual costs of disposition reasonably
incurred by Contractor for such efforts, and, if not previously
released and extinguished, any Security Interest or other right or
interest that Purchaser has in such items hereunder or otherwise shall
be released and extinguished and Purchaser shall take all action
reasonably requested by Contractor to terminate any document or
instrument filed of record (including without limitation UCC financing
statements) to perfect any such Security Interest. Purchaser shall take
all action reasonably requested by Contractor to terminate any document
or instrument filed of record (including without limitation UCC
financing statements) to perfect any such Security Interest.
21.2.4 Invalid Default Termination. If, after termination pursuant to this
Article 21.2, it is finally determined by arbitration pursuant to
Article 22 or written agreement of Contractor that Purchaser was not in
default under Article 21.2.1, Contractor shall be liable to Purchaser
for direct damages resulting from such termination of this Contract (in
no event exceeding amounts payable to Purchaser pursuant to Article
21.1, and subject to the limitation of liability set forth in Article
26).
21.3 EXCESSIVE FORCE MAJEURE
21.3.1 General. Purchaser may, upon written notice to Contractor, immediately
terminate this Contract, in whole or in part, if and when: (i) delay in
Contractor's performance of its obligations hereunder exceeds one year
due to Force Majeure events under Article 15.3; or (ii) it becomes
reasonably certain that the aggregate delay due to Force Majeure events
under Article 15.3 will exceed one year; or (iii) Contractor notifies
Purchaser that it is reasonably certain that delay in Contractor's
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performance of its obligations hereunder due to Force Majeure events
under Article 15.3 will exceed one year. Upon the occurrence of any of
these events, Purchaser will provide Contractor written notice of its
intent to terminate and the rights and obligations of the Parties shall
be the same as if such termination had occurred under Article 21.1.
Within a reasonable period of time not to exceed thirty (30) days after
the occurrence of either (i) or (iii) above, Purchaser will notify
Contractor as to its decision to either terminate this Contract or to
waive its rights to terminate for such Force Majeure events. Failure to
provide such notice in the thirty-day period specified above shall be
deemed to be a waiver of Purchaser's rights to terminate for such Force
Majeure events under this Article 21.3.
21.3.2 SBAS. In addition, Purchaser may, upon written notice to Contractor,
immediately terminate this Contract, in part, with respect to the HNS
Subcontracted Work, subject to the last sentence of this Article
21.3.2, if and when: (i) delay in completion of a Milestone with
respect to the SBAS set forth in Table 2 of Exhibit E-1, SBAS Program
Payment Plan, exceeds six (6) months of the completion date set forth
therein due to a Force Majeure Event under Article 15.1.2; or (ii) it
becomes reasonably certain that the aggregate delay completion of a
Milestone with respect to the SBAS set forth in Table 2 of Exhibit E-1,
SBAS Program Payment Plan, exceeds six (6) months of the completion
date set forth therein due to a Force Majeure Event under Article
15.1.2 will exceed six (6) months; or (iii) Contractor notifies
Purchaser that HNS has notified Contractor that HNS is reasonably
certain that aggregate delay completion of a Milestone with respect to
the SBAS set forth in Table 2 of Exhibit E-1, SBAS Program Payment
Plan, exceeds six (6) months of the completion date set forth therein
due to a Force Majeure Event under Article 15.1.2 will exceed six (6)
months, and in the case of all (i) - (iii) above Contractor has a
corresponding right to terminate HNS under the HNS Subcontract. Upon
the occurrence of any other these events, if Contractor fails to
provide Purchaser with a recovery plan reasonably acceptable to
Purchaser, Purchaser may provide Contractor written notice of
termination of the Contract with respect to the HNS Subcontracted Work.
In such case, the termination shall be processed as if it were a
termination of the HNS Subcontracted Work under Article 21.1.1C.
21.4 LIMITATION ON RIGHT TO TERMINATE
Except as specified in this Contract, neither Party shall have any right to
terminate or suspend this Contract.
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ARTICLE 22 - DISPUTE RESOLUTION
Any dispute, claim, or controversy between the Parties arising out of or
relating to this Contract ("Dispute"), including any Dispute with respect to the
interpretation, performance, termination, or breach of this Contract or any
provision thereof shall be resolved as provided in this Article 22.
22.1 INFORMAL DISPUTE RESOLUTION
Prior to the initiation of formal Dispute resolution procedures, the Parties
shall first attempt to resolve their Dispute informally, in a timely and
cost-effective manner, as follows:
A. If, during the course of the Work, a Party believes it has a
Dispute with the other Party, the disputing Party shall give
written notice thereof, which notice will describe the Dispute
and may recommend corrective action to be taken by the other
Party. Contractor Program Manager shall promptly consult with
Purchaser Contract Manager in an effort to reach an agreement
to resolve the Dispute.
B. In the event agreement cannot be reached within ten (10) days
of receipt of written notice, either Party may request the
Dispute be escalated, and the respective positions of the
Parties shall be forwarded to an executive level higher than
that under (A) above for resolution of the Dispute.
C. In the event agreement cannot be reached within twenty (20)
days of receipt of written notice, either Party may request
the Dispute be escalated, and the respective positions of the
Parties shall be forwarded to the Chief Executive Officer
(CEO) of each Party for resolution of the Dispute.
D. In the event (i) agreement cannot be reached under paragraphs
A - C of this Article 22.1 within a total of thirty (30) days
after receipt of the written notice described in Article 22.1
(A) or (ii) a Party determines in good faith that amicable
resolution through continued negotiation of the Dispute does
not appear likely, either Party may proceed with arbitration
in accordance with Article 22.2.
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22.2 ARBITRATION
22.2.1 Arbitration. Subject to Article 22.1 and 22.3, any Dispute arising
between the Parties shall be submitted for settlement by arbitration in
accordance with the rules of conciliation and arbitration of the Center
for Public Resources, as may be amended from time to time, which are
incorporated herein by reference (or if the Center for Public Resources
no longer provides rules or services, then the rules of conciliation
and arbitration of the American Arbitration Association).
Notwithstanding the foregoing, to the extent any provision of this
Article 22.2 modifies, adds to, or is inconsistent with any provision
of such rules, the provisions of this Article 22.2 shall control. Any
such arbitration shall be conducted in Washington, DC, by a panel of
three (3) arbitrators who shall be selected within forty-five (45) days
of commencement of the arbitration: one selected by each Party and the
third selected by the arbitrators chosen by the Parties. Should no
agreement be reached on the third arbitrator within the time specified,
the third arbitrator shall be appointed by the Center for Public
Resources. Each arbitrator appointed by the Parties shall be
knowledgeable and experienced in the aerospace and/or satellite
telecommunications industries and shall have senior management and/or
legal/judicial experience.
22.2.2 Discovery. Discovery shall be permitted as follows:
A. The Parties shall be permitted to take discovery, if and as
needed, by deposition upon oral examination, requests for
production of documents and things, and requests for entry
upon land for inspection and other purposes, as those
discovery methods are described and defined in the Federal
Rules of Civil Procedure; provided further that the Tribunal
shall expand or limit discovery in accordance with paragraph
(B) below.
B. The scope of permissible discovery shall generally be as
described in Federal Rules of Civil Procedure Rule 26(b)(1),
but the Parties shall use their best reasonable efforts to
focus and limit their discovery in accordance with the nature
of the Dispute and the need for expedited resolution. The
arbitral tribunal may expand or limit the scope of permissible
discovery, establish the time period within which discovery
responses must be served, and expand or limit the type and
number of discovery methods and requests as it shall determine
is appropriate in the circumstances, taking into account the
needs of the Parties and the desirability of making discovery
expeditious and cost-effective. The tribunal may issue orders
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to protect the confidentiality of proprietary information,
trade secrets, and other similar information disclosed in
discovery and may order that discovery not be had or that
discovery may be had only on specific terms and conditions.
22.2.3 Choice of Laws. In resolving any Dispute, the arbitrators shall apply
the laws of the State of New York without reference to its conflicts of
laws rules and shall take into account usages, customs and practices in
the performance of contracts for the purchase and sale of commercial
communications satellites.
22.2.4 Language. Proceedings and documents provided and generated in
connection with any arbitration hereunder shall be in the English
language.
22.2.5 Costs 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.
22.2.6 Offer. At any time more than ten (10) days before the commencement of
the arbitral hearing, any Party defending against any claim may serve
upon the adverse Party an offer to allow an award to be entered against
the defending Party on any claim for the money or property or to the
effect specified in the offer. If within ten (10) days after the
service of the offer, the adverse Party serves written notice that it
accepts the offer, either Party may file the offer and acceptance with
the tribunal, which will thereupon promptly enter an award on the claim
as provided in the offer. An offer not accepted shall be deemed
withdrawn and shall not be admissible into evidence.
22.2.7 Expedited Arbitration. Time is of the essence in the initiation and
completion of the arbitration. The arbitral hearing shall be commenced
and conducted expeditiously. Unless the arbitral tribunal orders
otherwise, the Dispute should be submitted to the tribunal for decision
within six (6) months after the commencement of the arbitration, and
the final award shall be rendered within one (1) month thereafter. The
Parties and the tribunal shall use their best reasonable efforts to
comply with this schedule, and the tribunal may impose any remedy it
deems just for any Party's effort to unnecessarily delay, complicate,
or hinder the proceedings.
22.2.8 Final and Binding Decision. Any arbitration hereunder shall be governed
by the United States Arbitration Act, 9 U.S.C. ss.ss. 1 et seq. The
arbitrators' decision shall be final and binding on the Parties and
enforceable in any court of competent jurisdiction.
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22.2.9 Arbitration Award. The arbitral tribunal's award may grant any remedy
or relief the tribunal deems within the scope of this Contract, but may
not make any award in any amount or on any theory of liability except
as otherwise allowed or provided in this Contract. Notwithstanding the
foregoing, the tribunal shall have no power or authority to amend or
disregard any provision of this Article 22.2 or any other provision of
this Contract; in particular, but without limiting the generality of
the foregoing, the tribunal shall not have the power or authority to
exclude the right of a Party to terminate this Contract when a Party
would otherwise have such right. Any monetary award made by the
arbitrators shall be subject to the limitation of liability set forth
in Article 26.
22.3 LITIGATION
Notwithstanding the provisions of Article 22.1 and Article 22.2 above, if a
Party makes a good faith determination that (i) a breach by the other Party is
such that a temporary restraining order or other preliminary injunctive relief
to enforce its rights or the other Party's obligations under the provisions of
this Contract and which is necessary or (ii) litigation is appropriate to avoid
the expiration of an applicable limitations period or to preserve a superior
position with respect to creditors, either Party shall have the right to bring
suit at any time, but requests for permanent injunctive relief shall be
arbitrated pursuant to Article 22.2.
Any such suit shall be brought in the United States District Court for the
Southern District of New York, and the Parties hereby waive any objection to
that venue and that court's exercise of personal jurisdiction over the case;
provided further that if, for any reason, such court does not have or refuses to
exercise subject matter jurisdiction over the Dispute, then litigation as
permitted herein may be brought in the Supreme Court for New York County. The
Parties hereby irrevocably consent to the exercise of personal jurisdiction by
the state and federal courts in the State of New York concerning any Dispute
between the Parties. If, for any reason, neither the state nor federal courts in
New York will exercise jurisdiction over the Dispute, then litigation as
permitted herein may be brought in any court of competent jurisdiction in the
United States of America.
Nothing in this Contract precludes a Party prevailing on any claim, whether in
arbitration or litigation, from initiating litigation in any appropriate forum
to enter or enforce a judgment based on the Tribunal's or court's award on that
claim.
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22.4 CONTINUED PERFORMANCE
Unless the Dispute involves a termination of the Contract under Articles 19 or
21 hereof: (i) pending final resolution of any Dispute, each Party shall, unless
directed otherwise by the other Party in writing, perform all its obligations
under this Contract to the extent undisputed and practical to do so, including
the obligation to take all steps necessary during the pendency of the Dispute to
ensure the Work will be performed within the time stipulated or within such
extended time as may be allowed under this Contract; and (ii) failure to pay
disputed amounts shall not excuse failure to so perform the Work, provided that
Purchaser has complied with its obligations set forth in Article 5.6.
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ARTICLE 23 - MAJOR SUBCONTRACTS
23.1 SELECTION OF MAJOR SUBCONTRACTORS
Selection of any Major Subcontractor, whether as an initial selection or as a
replacement selection, shall be subject to Purchaser's prior written approval.
Contractor shall provide Purchaser with a copy of the full text of any Major
Subcontract (including technical content but excluding price and payment
schedule) promptly upon execution thereof.
Purchaser's approval of any Major Subcontractor or subcontractor shall not
relieve Contractor from any obligations or responsibilities under this Contract.
23.2 STEP-IN RIGHTS
Contractor shall notify Purchaser within five (5) business days of it becoming
aware of the occurrence of an event that with or without the passage of time or
the giving of notice, or both, would give rise to a right of termination or a
right to receive damages or a payment of penalties under any of the Contractor's
Major Subcontracts that Contractor is not then disputing, in good faith, with
such subcontractor (a "Default"). Purchaser shall have the right (but not the
obligation) to cure any such Default, including by making any payment due
thereunder. The Firm Fixed Price shall be reduced by the amount of the cost to
cure such Default paid by Purchaser pursuant to the preceding sentence. Such
reduction in the Firm Fixed Price shall be applied against and used to reduce
the next payment due to Contractor under the Payment Plan (which shall be
adjusted accordingly). No action on the part of Purchaser under this Section
shall relieve Contractor from any obligations or responsibilities under this
Contract or the Major Subcontract.
23.3 HNS SUBCONTRACT
As of SBN EDC, Purchaser acknowledges it has reviewed and approved all the terms
and conditions (including all Exhibits) of the HNS Subcontract. The HNS
Subcontract shall not be modified as to its material terms without the prior
written approval of Purchaser, which approval shall not be unreasonably
withheld, delayed or denied.
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ARTICLE 24 - CONTRACTOR INSURANCE REQUIREMENTS
24.1 INSURANCE REQUIREMENTS
24.1.1 Coverages. Contractor represents that it has procured and will maintain
at all times during its performance of this Contract the following
insurance coverages:
A. Ground insurance ("Property Insurance") against all risks and
loss or damage to the Deliverable Items, and to any and all
component parts thereof and all materials of whatever nature
used or to be used in completing the Work, in an amount not
less than the greater of (i) the replacement value of or (ii)
the amounts paid by Purchaser with respect to the Deliverable
Items and component parts thereof and all materials of
whatever nature used or to be used in completing the Work.
Such insurance shall provide (i) coverage for removal of
debris, and insuring the structures, machines, equipment,
facilities, fixtures, and other properties constituting part
of the Work, (ii) transit coverage, including ocean marine
coverage (unless insured by the supplier), (iii) off-site
coverage covering any key equipment, and (iv) off-site
coverage covering any property or equipment not stored on the
construction site. The deductible for Property Insurance is
Three Million U.S. dollars (US$3,000,000) for finished goods
and inventory. For each Deliverable Item, such insurance shall
cover the period beginning at SBN EDC up to the moment risk of
loss passes to Purchaser pursuant to Article 11.
B. Worker's compensation insurance, including occupational
illness or disease coverage, or other similar social insurance
in accordance with the laws of any country, state, or
territory exercising jurisdiction over the employee and
employer's liability insurance in an amount not less than One
Million U.S. dollars (US $1,000,000) per occurrence.
Contractor shall maintain such insurance until Acceptance of
all Work, including remedial work, has occurred.
C. Comprehensive automobile liability insurance against liability
claims for personal injury (including bodily injury and death)
and property damage covering all owned, leased, non-owned, and
hired vehicles used by Contractor in the performance of the
Work. Such insurance shall be for an amount not less than One
Million U.S. dollars (US$1,000,000) per occurrence for
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combined bodily injury and property damage. Contractor shall
maintain such insurance until Acceptance of all Deliverable
Items has occurred.
D. Such other insurance in types and amounts as is adequate to
cover Contractor's potential liabilities under this Contract
and applicable law.
24.1.2 Additional Insured. Purchaser and each Financing Entity shall be named
as an additional insured under Contractor's third-party liability
coverages, provided that, with respect to each Financing Entity, such
Financing Entity has an insurable interest recognized by the applicable
insurance underwriters.
24.1.3 Insurers Rating. The insurers selected by Contractor to provide the
insurance required by Article 24.1.1A shall have a rating at least as
high as those insurers providing coverage on Contractor's programs for
its major commercial customers.
24.1.4 Evidence of Insurance. Prior to commencing the Work, and whenever
requested by Purchaser, Contractor shall produce evidence that the
insurance required by Article 24.1.1 has been effected and is being
maintained. Contractor shall, at the written request of Purchaser,
provide Purchaser with a certificate of insurance evidencing the
procurement of all required insurance policies and thirty (30) days
written notice prior to any modification that diminishes the insurance
coverage required hereunder, cancellation, or non-renewal of such
policies. If, after being requested in writing by Purchaser to do so,
Contractor fails to produce evidence of compliance with Contractor's
insurance obligations within fourteen (14) days, Purchaser may effect
and maintain the insurance and pay the premiums. The amount paid shall
be a debt due from Contractor to Purchaser and may be offset against
any payments due Contractor by Purchaser. Purchaser may, at reasonable
times upon reasonable notice, inspect any insurance policy required
hereunder at Contractor's offices.
24.1.5 Claims. Contractor shall, as soon as practicable, inform Purchaser in
writing of any occurrence with respect to the Work that may give rise
to a claim under a policy of insurance required by Article 24.1.1A
above. Contractor shall ensure that its Subcontractors similarly inform
Purchaser of any such occurrences through Contractor.
24.1.6 Waiver of Subrogation. Contractor shall use best reasonable efforts to
require its insurers to waive all rights of subrogation against
Purchaser and Purchaser's Affiliates and their respective associates.
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24.1.7 Warranty. Contractor warrants and covenants that the insurance
coverages and deductibles to be obtained pursuant to this Article 24
are substantially comparable to those provided to Contractor's major
commercial customers.
24.2 PREPARATION OF CLAIMS
Each Party shall provide to the other Party any information that may reasonably
be required to prepare, present, and substantiate an insurance claim at the
other Party's written request.
Each Party warrants and covenants that it will not intentionally withhold from
the other Party any material information it has or will have concerning
anomalies, failures, or non-conformances with or deviations from the
requirements of this Contract.
Upon written request of a Party, subject to Article 7, the other Party will
respond or permit the first Party to respond to any insurers in relation to all
specific and reasonable questions relating to design, test, quality control,
launch, and orbital information. In addition, in the event of a Launch and
In-Orbit Insurance Policy claim (as defined in the Satellite Contract),
Contractor shall provide the support described in Article 24.3 below.
24.3 CONTRACTOR SUPPORT FOR LAUNCH AND IN-ORBIT INSURANCE POLICY
CLAIMS
24.3.1 Insurance Procurement
Contractor has agreed under the Satellite Contract to provide customary and
normal support to assist Purchaser in obtaining a Launch and In-Orbit Insurance
Policy (as defined in the Satellite Contract). To the extent such support
requires information and presentations regarding the SBN, Contractor agrees to
provide such SBN-related support.
24.3.2 Claims Support
Contractor has agreed in the Satellite Contract to cooperate with and provide
reasonable support to Purchaser making and perfecting claims for insurance
recovery and as to any legal proceeding as may be brought by Purchaser
associated with any claim for insurance recovery. To the extent such support is
needed with respect to a claim(s) pertaining to the SBN, Contractor shall
provide the necessary SBN-related support. For all claims that may arise on or
before SBN Acceptance of the Satellite as provided in Article 9 hereof, such
Contractor support as described above shall be provided within the overall price
of this Contract; thereafter, Contractor shall be entitled to reimbursement of
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actual costs reasonably incurred in connection with the provision of such
support plus a mark-up of ten percent (10%), with such costs and markup to be
invoiced and paid in accordance with Article 5.
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ARTICLE 25 - PERSONNEL AND KEY PERSONNEL
25.1 PERSONNEL QUALIFICATIONS
Contractor shall assign properly qualified and experienced personnel to the
program contemplated under this Contract, and Contractor shall use best
reasonable efforts to retain such personnel on Purchaser's program for the
duration of such program.
25.2 KEY PERSONNEL POSITIONS
Key personnel ("Key Personnel") shall be the personnel filling the following or
equivalent positions:
25.2.1 [***]
25.2.2 [***]
25.2.3 [***]
25.3 ASSIGNMENT OF KEY PERSONNEL
25.3.1 Contractor will assign individuals from within Contractor's organization
to the Key Personnel positions to carry out the Work.
25.3.2 Key Personnel will be familiar with programs similar to Purchaser's
program.
25.3.3 Before assigning an individual to any Key Personnel positions, whether as
an initial assignment or a subsequent assignment, Contractor shall notify
Purchaser of the proposed assignment, shall introduce the individual to
appropriate Purchaser representatives and, upon request, provide such
representatives with the opportunity to interview the individual and shall
provide Purchaser with the individual's resume. If Purchaser in good faith
objects to the qualifications of the proposed individual within fifteen (15)
Business Days after being notified thereof, then Contractor agrees to discuss
such objections with Purchaser and attempt to resolve such concerns on a
mutually agreeable basis; however, Contractor retains the unilateral right to
make all decisions regarding the assignment of Contractor personnel to the
program. Notwithstanding the foregoing, after CDR, any change in the Contractor
Program Manager shall be subject to Purchaser's prior written approval. The Key
Personnel that have been identified as of the SBN EDC are listed in Attachment B
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(Key Personnel). Should the individuals filling the positions of Key Personnel
leave such positions for whatever reason, Contractor shall follow the procedures
set forth in this Article 25 to select replacement personnel.
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ARTICLE 26 - LIMITATION OF LIABILITY
26.1 LIMITATION OF LIABILITY
26.1.1 No Consequentials. NEITHER PARTY SHALL BE LIABLE DIRECTLY OR INDIRECTLY
TO THE OTHER, TO THEIR OFFICERS, DIRECTORS, EMPLOYEES, CONTRACTORS OR
SUBCONTRACTORS AT ANY TIER (INCLUDING SUPPLIERS OF ANY KIND), AGENTS OR
CUSTOMERS, TO ITS PERMITTED ASSIGNEES OR SUCCESSOR OWNERS OF ANY DELIVERABLE
ITEM OR TO ANY OTHER PERSON CLAIMING BY OR THROUGH PURCHASER FOR ANY AMOUNTS
REPRESENTING LOSS OF PROFITS, LOSS OF BUSINESS, OR INDIRECT, SPECIAL,
INCIDENTAL, EXEMPLARY, CONSEQUENTIAL OR PUNITIVE DAMAGES, INCLUDING WITHOUT
LIMITATION COSTS OF EFFECTING COVER, LOST PROFITS, OR LOST REVENUES, ARISING
FROM OR RELATING TO THE PERFORMANCE OR NONPERFORMANCE OF THIS CONTRACT OR ANY
ACTS OR OMISSIONS ASSOCIATED THEREWITH OR RELATED TO THE USE OF ANY ITEMS
DELIVERED OR SERVICES FURNISHED HEREUNDER, WHETHER THE BASIS OF SUCH LIABILITY
IS BREACH OF CONTRACT, TORT (INCLUDING NEGLIGENCE OF ANY TYPE AND STRICT
LIABILITY), STATUTE OR OTHER LEGAL OR EQUITABLE THEORY.
26.1.2 Indemnity. PURCHASER SHALL INDEMNIFY CONTRACTOR AND HOLD CONTRACTOR
HARMLESS FOR AND AGAINST ANY CLAIM ASSERTED DIRECTLY OR INDIRECTLY AGAINST
CONTRACTOR THAT IS WITHIN THE SCOPE OF THE FOREGOING LIMITATION OF LIABILITY AND
DISCLAIMER.
26.2 CAP ON LIABILITY
IN NO EVENT SHALL CONTRACTOR'S TOTAL LIABILITY UNDER OR IN CONNECTION WITH THIS
CONTRACT EXCEED AMOUNTS PAID TO CONTRACTOR HEREUNDER. IN NO EVENT SHALL
PURCHASER'S TOTAL LIABILITY UNDER OR IN CONNECTION WITH THIS CONTRACT EXCEED THE
TERMINATION AMOUNT CALCULATED PURSUANT TO ARTICLE 19. THIS ARTICLE 26 SHALL
SURVIVE THE EXPIRATION OR TERMINATION OF THIS CONTRACT FOR WHATEVER CAUSE.
26.3 EXCEPTIONS
NOTWITHSTANDING THE FOREGOING, THE LIMITATIONS OF LIABILITY SET FORTH IN THE
FOREGOING ARTICLES 26.1 AND 26.2 OR ANY OTHER PROVISION OF THIS CONTRACT SHALL
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NOT APPLY TO (i) CLAIMS SUBJECT TO INDEMNIFICATION UNDER ARTICLE 4.2 (AS TO
TAXES AS DEFINED IN ARTICLE 4.2), ARTICLE 17, OR ARTICLE 18 AND (ii) CLAIMS
ARISING OUT OF WILLFUL MISCONDUCT BY SENIOR MANAGEMENT PERSONNEL (VICE PRESIDENT
AND ABOVE).
26.4 DUTY TO MITIGATE
Each Party shall have a duty to mitigate damages for which the other Party is
responsible.
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ARTICLE 27 - DISCLOSURE AND HANDLING OF PROPRIETARY INFORMATION
27.1 DEFINITION OF PROPRIETARY INFORMATION
27.1.1 Definition. For the purpose of this Contract, "Proprietary Information"
means all confidential and proprietary information (other than the
Exhibits and Attachments to this Contract and Deliverable Data, which
are subject to the provisions of Article 28) in whatever form
transmitted, that is disclosed or made available directly or indirectly
by such Party (hereinafter referred to as the "disclosing party") to
the other Party hereto (hereinafter referred to as the "receiving
party") and: (i) is identified as proprietary by means of a written
legend thereon, or (ii) if disclosed orally, is identified as
proprietary at the time of initial disclosure and then summarized in a
written document, with the Proprietary Information specifically
identified, that is supplied to the receiving party within ten (10)
days of initial disclosure. In the case of Purchaser, Proprietary
Information also shall include, whether or not designated "Proprietary
Information," (i) correspondence under this Contract and (ii) all
information concerning Purchaser (and/or its Affiliates) regarding its
operations, affairs and businesses, its financial affairs, and its
relations with its customers, employees and service providers
(including business plans, customer lists, customer information,
account information and consumer markets).
27.1.2 Exceptions. Proprietary Information shall not include any information
disclosed by a Party that (i) is already known to the receiving party
at the time of its disclosure, as evidenced by written records of the
receiving party, without an obligation of confidentiality at the time
of disclosure; (ii) is or becomes publicly known through no wrongful
act of the receiving party; (iii) is independently developed by the
receiving party as evidenced by written records of the receiving party;
or (iv) is rightfully obtained by the receiving party from any third
party without restriction and without breach of any confidentiality
obligation by such third party.
27.2 TERMS FOR HANDLING AND USE OF PROPRIETARY INFORMATION
Subject to Article 27.1.2, for a period of ten (10) years after receipt of any
Proprietary Information, the receiving party shall not disclose Proprietary
Information that it obtains from the disclosing party to any person or entity
except its employees, Affiliates, attorneys, agents and consultants (all of whom
are not direct competitors of the disclosing party) who have a need to know, who
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have been informed of and have agreed in writing (or, in the case of employees
or attorneys are otherwise subject to confidentiality obligations consistent
with the obligations set forth herein) to abide by the receiving party's
obligations under this Article 27, and who are authorized pursuant to applicable
U.S. export control laws and licenses or other approvals to receive such
information. The receiving party shall use not less than the same degree of care
to avoid disclosure of such Proprietary Information as it uses for its own
Proprietary Information of like importance; but in no event less than a
reasonable degree of care. Proprietary Information shall be used only for the
purpose of performing the obligations under this Contract, or as the disclosing
party otherwise authorizes in writing.
27.3 DISCLAIMER OF REPRESENTATIONS AND WARRANTIES
Contractor makes no representation or warranty regarding the accuracy or
completeness of, or absence of defects in, the Proprietary Information disclosed
hereunder, or with respect to infringement of any rights, including Intellectual
Property Rights of others, arising from its disclosure of Proprietary
Information hereunder. Contractor shall not be liable for damages of whatever
kind as a result of Purchaser's reliance on or use of the Proprietary
Information provided under this Article 27.
27.4 LEGALLY REQUIRED DISCLOSURES
Notwithstanding the foregoing, in the event that the receiving party becomes
legally compelled (including disclosures necessary or in good faith determined
to be reasonably necessary under the Securities Act of 1933, as amended, and the
Securities Exchange Act of 1934, as amended), to disclose Proprietary
Information of the disclosing party, including this Contract or other supporting
document(s), the receiving party shall, to the extent practicable under the
circumstances, provide the disclosing party with written notice thereof so that
the disclosing party may seek a protective order or other appropriate remedy, or
to allow the disclosing party to redact such portions of the Proprietary
Information as the disclosing party deems appropriate. In any such event, the
receiving party will disclose only such information as is legally required, and
will cooperate with the disclosing party (at the disclosing party's expense) to
obtain proprietary treatment for any Proprietary Information being disclosed.
27.5 RETURN OF CONFIDENTIAL INFORMATION
Upon the request of the Party having proprietary rights to Proprietary
Information, the other Party in possession of such Proprietary Information shall
promptly return such Proprietary Information (and any copies, extracts, and
summaries thereof) to the requesting Party, or, with the requesting Party's
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written consent, shall promptly destroy such materials (and any copies,
extracts, and summaries thereof), except for one (1) copy which may be retained
for legal archive purposes, and shall further provide the requesting Party with
written confirmation of same; provided, however, where both Parties have
proprietary rights in the same Proprietary Information, a Party shall not be
required to return such information to the other Party.
27.6 NO LICENSE
Except as expressly provided in this Contract, nothing in this Contract shall be
construed as granting the receiving party whether by implication, estoppel, or
otherwise, any license or any right to use any Proprietary Information received
from the disclosing party, or use any patent, trademark, or copyright now or
hereafter owned or controlled by the disclosing party.
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ARTICLE 28 - INTELLECTUAL PROPERTY RIGHTS
28.1 OWNERSHIP OF IP AND IP RIGHTS
28.1.1 Purchaser's Intellectual Property
A. Subject to the licenses granted in Article 28.2.2, all
Background and Foreground Intellectual Property made,
developed, or created by Purchaser (or by others, other than
Contractor or any of its subcontractors, acting on behalf of
Purchaser, but not including HNS Foreground IP which is
subject to a separate agreement between Purchaser and HNS),
and all Intellectual Property Rights therein, shall be the
sole and exclusive property of Purchaser.
B. Subject to the licenses granted in Article 28.2.2, Purchaser
shall own all Intellectual Property developed or created by
Contractor (or its subcontractors) that is ATC IP, and all
Intellectual Property Rights therein, shall be the sole and
exclusive property of Purchaser. Contractor hereby assigns all
right, title and interest in and to all such ATC IP and, at
Purchaser's request and expense, Contractor agrees to provide
all reasonable cooperation to help Purchaser perfect those
rights, including the filing of patents. Further, and subject
to the licenses granted in Article 28.2.2.B, Contractor hereby
agrees to require HNS, pursuant to the HNS Subcontract, to
transfer and assign all right, title and interest in and to
all HNS Foreground IP to Purchaser and to require that HNS, at
Purchaser's expense, provide all reasonable cooperation to
Purchaser to perfect those rights.
28.1.2 Contractor's Intellectual Property
A. Subject to the licenses granted in Article 28.2.1, all
Background Intellectual Property, developed or created by
Contractor (or its subcontractors), and all Intellectual
Property Rights therein, shall be the sole and exclusive
property of Contractor.
B. Subject to the licenses granted in Article 28.2.1, all
Foreground Intellectual Property (excluding any ATC IP and HNS
Foreground IP), developed or created by Contractor (or its
subcontractors), and all Intellectual Property Rights therein,
shall be the sole and exclusive property of Contractor.
C. Contractor agrees that the obligations set forth in Article
27.2, subject to the exceptions set forth in Article 27.1.2,
shall apply to Contractor with respect to the handling and use
of Purchaser-specific information contained in any Deliverable
Data, Contract Exhibits and Attachments thereto, without
regard to the time limitation set forth therein.
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28.2 LICENSE RIGHTS
28.2.1 Grant by Contractor
A. Subject to the terms and conditions stated herein, Contractor
grants to Purchaser a fully paid-up, irrevocable, perpetual,
worldwide, nonexclusive right and license to use and have
used, reproduce, and modify and sublicense to an Affiliate for
the sole and exclusive purpose of testing, operating, and/or
maintaining any Deliverable Item (including Deliverable Data),
all Contractor Background Intellectual Property and Foreground
Intellectual Property (excluding any ATC IP and HNS Foreground
IP) incorporated into such Deliverable Items (for the purposes
of this paragraph A, Deliverable Items includes Contract
Exhibits and Attachments thereto), including, to the extent
necessary for the limited purpose of this license, those
associated Intellectual Property Rights therein, now or
hereafter owned by Contractor (and/or its subcontractors) for
which Contractor (and/or its subcontractors) has or may
acquire the right to grant such a license. Purchaser shall
have no rights in Deliverable Data other than as expressly
stated in this Contract, except that, subject to compliance
with the provisions of Article 7 hereof, Purchaser may provide
portions of the Deliverable Data related to operation or
performance of the SBAS as is commercially necessary and
reasonable to market and sell the Satellite capacity to
Purchaser's customers and potential customers. Title to
Deliverable Data shall not pass to Purchaser or any other
entity pursuant to the terms hereof, except to the extent that
such Deliverable Data includes ATC IP or HNS Foreground IP.
B. Subject to the terms and conditions stated herein and in
addition to the rights granted to Purchaser pursuant to
Article 28.1.1.B, and 28.2.1.A, Contractor grants to Purchaser
a fully paid-up, irrevocable, perpetual, worldwide,
nonexclusive right and license to use and have used,
reproduce, and modify and sublicense to an Affiliate for the
sole and exclusive purpose of running its satellite program
(including procurement of additional satellites from vendors
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other than Contractor) Exhibits A-1 and A-2, Statements of
Work, and Exhibits B-1 and B-2, Performance Specifications,
including to the extent necessary for the limited purpose of
this license, all associated Intellectual Property Rights
therein now or hereafter owned by Contractor (and/or its
subcontractors) for which Contractor (and/or its
subcontractors) has or may acquire the right to grant such a
license. The foregoing license shall be subject to: (i) good
faith reasonable redactions in Exhibits A-1, A-2, B-1 and B-2
to eliminate any unique, Contractor competition-sensitive
information contained therein, such redactions to be agreed
upon by the Parties on or prior to Satellite Technical Review
3 and (ii) the elimination of all references to Space
Systems/Loral, Inc. in such documents. The foregoing licenses
shall be transferable to the Financing Entities, any successor
or permitted assign of Purchaser, and any third party pursuant
to Articles 32.1.2 or 34.12 and, subject to Contractor's prior
written approval, which approval shall not be unreasonably
withheld, conditioned or delayed, any other entity.
28.2.2 Grant by Purchaser
A. Subject to the terms and conditions stated herein, Purchaser
grants to Contractor a fully paid-up, irrevocable, perpetual,
worldwide, non-exclusive right and license to use and have
used for the sole and exclusive purpose of performing under
this Contract, all Purchaser Background Intellectual Property,
and Foreground Intellectual Property (other than ATC IP which
is subject to Article 28.2.2.B and HNS Foreground IP which is
subject to Article 28.2.2.C), including, to the extent
necessary for the limited purpose of this license, those
associated Intellectual Property Rights therein, owned by
Purchaser (or others acting on behalf of Purchaser) for which
Purchaser has or may acquire the right to grant such a
license.
B. Purchaser grants to Contractor a fully paid-up, irrevocable,
perpetual, worldwide, non-exclusive right and license to use
and have used all rights relating to the ATC IP developed or
created by Contractor (or its subcontractors), but excluding
any HNS Foreground IP and any Background Intellectual Property
made, developed by or on behalf of HNS.
C. Subject to the terms and conditions stated herein, Purchaser
grants to Contractor a fully paid-up, irrevocable, perpetual,
worldwide, non-exclusive right and license to use and have
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used for the sole and exclusive purpose of performing under
this Contract, the HNS Foreground IP to the extent the
ownership of such HNS Foreground IP is transferred to
Purchaser by HNS and those associated Intellectual Property
Rights therein owned by Purchaser (or others acting on behalf
of Purchaser) for which Purchaser has or may acquire the right
to grant such a license.
28.2.3 Subcontracts Other Than the HNS Subcontract. Contractor shall, unless
otherwise authorized or directed in writing by Purchaser, to the extent
necessary to fulfill its obligations under this Article 28.2 hereof,
use reasonable efforts as practical to include in each subcontract
issued hereunder a license rights clause pursuant to which each such
subcontractor will grant to Purchaser (through Contractor) license
rights in Intellectual Property incorporated in Deliverable Items
hereunder and which Intellectual Property is developed by such
subcontractor, and all associated Intellectual Property Rights therein,
to the same extent as the license rights granted by Contractor in this
Article 28.2. Contractor's failure to include such provision in any
subcontract shall not limit Contractor's obligation to provide
Purchaser with the license rights granted in this Article 28.
28.3 NO LIMITATION ON DELIVERABLE ITEMS
This Article 28 shall not be construed as limiting any right of Purchaser
otherwise contained herein or at law (or any obligation of Contractor to grant
Purchaser the right) with no payment of additional compensation to use, have
used, deliver, lease, sell, or otherwise dispose of the Satellite or other
Deliverable Item of hardware or any part thereof.
28.4 NO ADDITIONAL DELIVERABLE DATA OBLIGATION
Nothing contained in this Article shall require Contractor to provide any data
other than as set forth in Exhibits A-1 and A-2.
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ARTICLE 29 - PUBLIC RELEASE OF INFORMATION
29.1 GENERALLY
Either Party intending to disclose publicly, whether through the issuance of
news releases, articles, brochures, advertisements, prepared speeches or other
information releases, information concerning the financial details of this
Contract or Proprietary Information of the other Party regarding the Work shall
obtain the prior written approval of the other Party with respect to the content
and timing of such issuance.
29.2 EXCEPTIONS
The obligations set forth in Article 29.1 shall not apply to the following:
A) information that is or otherwise becomes publicly available
from any governmental agency; and/or
B) information that is or otherwise becomes publicly available
without breach of this Contract; and/or
C) internal publications or releases which are clearly marked as
not intended for the public at large.
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ARTICLE 30 - NOTICES
30.1 WRITTEN NOTIFICATION
Each notice or correspondence required or permitted to be given or made
hereunder shall be in writing (except where oral notice is specifically
authorized) to the respective addresses, facsimile and telephone numbers and to
the attention of the individuals set forth below, and any such notice or
correspondence shall be deemed given on the earlier to occur of (i) actual
receipt, irrespective of whether sent by post, facsimile transmission (followed
by mailing of the original copy), overnight courier or other method, or (ii)
seven (7) days after mailing by registered or certified mail, return receipt
requested, postage prepaid.
TerreStar Networks Inc.
------------------------------------------
Attn.: [***]
------------------------------
[***]
------------------------------
12010 Sunset Hills Road
------------------------------
------------------------------
Reston, VA 20190
------------------------------
Tel: [***]
------------------------------
Fax: [***]
------------------------------
With a copy to:
TerreStar Networks Inc.
------------------------------------------
Attn.: [***]
------------------------------
[***]
------------------------------
12010 Sunset Hills Road
------------------------------
------------------------------
Reston, VA 20190
------------------------------
Tel: [***]
------------------------------
Fax: [***]
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or to such other address as Purchaser may specify in writing to Contractor.
In the case of Contractor:
Space Systems/Loral, Inc.
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3825 Fabian Way
------------------------------
Palo Alto, CA 94303-4697
------------------------------
Attn.: [***]
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Tel: [***]
------------------------------
Fax: [***]
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With a separately delivered copy to:
Space Systems/Loral, Inc.
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3825 Fabian Way
-----------------------------
Palo Alto, CA 94303-4697
-----------------------------
Attn.: [***]
-----------------------------
Tel: [***]
-----------------------------
Fax: [***]
-----------------------------
30.2 CHANGE OF ADDRESS
Either Party may from time to time change its notice address or the persons to
be notified by giving the other Party written notice (as provided above) of such
new information and the date upon which such change shall become effective.
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ARTICLE 31 - ORDER OF PRECEDENCE
In the event of conflict among the terms of the Terms and Conditions (Preamble,
Recitals, and Articles 1 to 34) of this Contract and the Exhibits, the following
order of decreasing precedence shall apply:
o Terms and Conditions (Preamble and Articles 1 through 34)
o Exhibit E SBN/SBAS Payment Plans and Termination
Liability Amounts (in the order listed in
Article 2)
o Exhibit A Statements of Work (in the order listed in
Article 2)
o Exhibit B Performance Specifications (in the order
listed in Article 2)
o Exhibit D Test Plans (in the order listed in Article
2)
o Attachment A Form of Invoice (including Annex 1 and
Schedule 1 to Annex 1)
o Attachment B Key Personnel
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ARTICLE 32 - GENERAL
32.1 ASSIGNMENT
32.1.1 General. This Contract may not be assigned, either in whole or in part,
by either Party without the express written approval of the other
Party. The non-assigning Party shall provide its approval if in its
reasonable judgment its rights under this Contract are not and would
not be adversely affected thereby.
32.1.2 By Purchaser. Notwithstanding the foregoing, Purchaser may assign or
transfer this Contract or all its rights, duties, or obligations
hereunder to (i) any Affiliate of Purchaser provided that in the case
of a transfer to an Affiliate, the Affiliate has sufficient financial
resources to fulfill its obligations under this Contract, and the net
worth of such Affiliate is not less than the net worth of Purchaser
immediately prior to such transfer, (ii) any or all Financing Entities
in connection with obtaining financing for the payment of Contractor's
invoices and any and all other fees, charges or expenses payable under
this Contract under any Financing Agreement; and (iii) as part of any
collateral pool in favor of other senior lenders providing financing to
Purchaser or any of its Affiliates in connection with completion of
Purchaser's Satellite system, provided in any case the assignee,
transferee, or successor to Purchaser has expressly assumed all the
obligations of Purchaser and all terms and conditions applicable to
Purchaser under this Contract in form and substance reasonably
satisfactory to Contractor.
32.1.3 By Contractor. Notwithstanding the foregoing, Contractor may assign or
transfer this Contract or all of its rights, duties, or obligations
hereunder to: (i) any Affiliate of Contractor, or (ii) any corporation
in connection with the sale, transfer or assignment of all or
substantially all of Contractor's assets or capital stock, whether by
way of merger, consolidation, or otherwise, subject to the following
conditions: (A) in the case of a transfer to an Affiliate, the net
worth of such Affiliate is not less than the net worth of Contractor
immediately prior to such transfer and, in the reasonable discretion of
Purchaser such Affiliate has the experience, resources, and personnel
required to perform the Work in accordance with this Contract; (B) in
the case of a transfer or assignment contemplated in clause (ii),
immediately after giving effect to such transaction or series of
related transactions, the net worth of Contractor (or in the event
Contractor is not the continuing person, the net worth of the person or
entity formed by such consolidation or into which Contractor is merged
or to which its properties are transferred substantially as an
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entirety) shall be no less than the net worth of Contractor immediately
before such transaction or series of related transactions, and in the
case of the sale of all or substantially all the assets of Contractor,
the assignee or transferee, in the reasonable discretion of Purchaser,
has the experience, resources and personnel required to perform the
Work in accordance with this Contract; and (C) the assignee,
transferee, or successor to Contractor has expressly assumed all the
obligations of Contractor and all terms and conditions applicable to
Contractor under this Contract in form and substance reasonably
satisfactory to Purchaser.
32.1.4 Security Interests. Either Party, upon prior written notice to the
other Party, may grant security interests in its rights hereunder to
lenders that provide financing for the performance by such Party of its
obligations under this Contract or for the subject matter hereof. In
the event that either Party is sold to or merged into another entity,
its responsibilities under this Contract shall not be altered and the
successor organization shall be liable for performance of such Party's
obligations under this Contract.
32.2 BINDING EFFECT
This Contract shall be binding upon and inure to the benefit of the Parties and
their respective successors and permitted assigns. Assignment of this Contract
shall not relieve the assigning Party of any of its obligations nor confer upon
the assigning Party any rights except as provided in this Contract.
32.3 SEVERABILITY
If any provision of this Contract is declared or found to be illegal,
unenforceable or void, the Parties shall negotiate in good faith to agree upon a
substitute provision that is legal and enforceable and is as nearly as possible
consistent with the intentions underlying the original provision. If the
remainder of this Contract is not materially affected by such declaration or
finding and is capable of substantial performance, then the remainder shall be
enforced to the extent permitted by law.
32.4 WAIVER OF BREACH OF CONTRACT
A waiver of any provision or any breach of a provision of this Contract shall
not be binding upon either Party unless the waiver is in writing, signed by a
duly authorized representative of the Party to be bound, as applicable, and such
waiver shall not affect the rights of the Party not in breach with respect to
any other or future breach. No course of conduct by a Party shall constitute a
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waiver of any provision or any breach of a provision of this Contract unless a
written waiver is executed in accordance with the provisions of this Article
32.4.
32.5 AMENDMENTS
This Contract, including any and all its Attachments and Exhibits and
Appendices, may not be modified except by written instrument of subsequent date
signed by an officer of Contractor, or another person designated in writing by
any such officer to sign such an instrument and a senior vice president of
Purchaser, or another person designated in writing by any such Purchaser senior
vice president to sign such an instrument.
32.6 CAPTIONS
The captions contained herein are for purposes of convenience only and shall not
affect the construction of this Contract.
32.7 RELATIONSHIPS OF THE PARTIES
It is expressly understood that Contractor and Purchaser intend by this Contract
to establish the relationship of independent contractors only, and do not intend
to undertake the relationship of principal and agent or to create a joint
venture or partnership or any other relationship, other than that of independent
contractors, between them or their respective successors in interests. Neither
Contractor nor Purchaser shall have any authority to create or assume, in the
name or on behalf of the other Party, any obligation, expressed or implied, or
to act or purport to act as the agent or the legally empowered representative of
the other Party, for any purpose whatsoever.
32.8 ENTIRE AGREEMENT
This Contract, including all its Attachments and Exhibits, represents the entire
understanding and agreement between the Parties hereto with respect to the
subject matter hereof, and supersedes all other prior agreements and
negotiations with respect to the subject matter hereof, including that certain
Authorization to Proceed (ATP) between the Parties dated November 14, 2006. All
work done and payments made under the ATP shall be deemed work done and payments
made under this Contract as of the SBN EDC.
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32.9 STANDARD OF CONDUCT
Both Parties agree that all their actions in carrying out the provisions of this
Contract shall be in compliance with applicable laws and regulations and neither
Party will pay or accept bribes, kickbacks or other illegal payments, or engage
in unlawful conduct.
32.10 CONSTRUCTION
This Contract, including all its Schedules, Attachments, Annexes, Exhibits and
the Appendices, has been drafted jointly by the Parties and in the event of any
ambiguities in the language hereof, there shall be no inference drawn in favor
of or against either Party.
32.11 COUNTERPARTS
This Contract may be signed in any number of counterparts with the same effect
as if the signature(s) on each counterpart were upon the same instrument.
32.12 APPLICABLE LAW
This Contract shall be interpreted, construed and governed, and the rights of
the Parties shall be determined, in all respects, according to the laws of the
State of New York without reference to its conflicts of laws rules.
32.13 SURVIVAL
Termination or expiration of this Contract for any reason shall not release
either Party from any liabilities or obligations set forth in this Contract that
(i) the Parties have expressly agreed shall survive any such termination or
expiration or (ii) remain to be performed or by their nature would be intended
to be applicable following any such termination or expiration.
32.14 U.N. CONVENTION ON THE INTERNATIONAL SALES OF GOODS
The U.N. Convention on the International Sales of Goods shall not apply or
otherwise have any legal effect with respect to this Contract.
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32.15 NO THIRD-PARTY BENEFICIARIES
This Contract is entered into solely between, and may be enforced only by,
Purchaser and Contractor and their permitted assigns, and this Contract shall
not be deemed to create any rights in third parties, including suppliers,
customers and owners of a Party, or to create any obligations of a Party to any
such third parties.
32.16 CONSENTS AND APPROVALS
Except where expressly provided as being in the sole discretion of a Party,
where agreement, approval, acceptance, consent, or similar action by either
Party is required under this Contract, such action shall not be unreasonably
delayed or withheld. An approval or consent given by a Party under this Contract
shall not relieve the other Party from responsibility for complying with the
requirements of this Contract, nor shall it be construed as a waiver of any
rights under this Contract, except as and to the extent otherwise expressly
provided in such approval or consent.
32.17 LENDER REQUIREMENTS
32.17.1 External Financing. The Parties recognize this Contract may be financed
through external sources. Contractor shall provide to any Financing
Entity any program information that such Financing Entity reasonably
requires (subject to confidentiality agreements governing such program
information).
32.17.2 Cooperation. Contractor agrees to work cooperatively to negotiate and
execute such documents as may be reasonably required to implement such
financing to the extent such financing or document does not impose any
material obligations not otherwise undertaken hereunder, require
Contractor or its Affiliates to violate any contractual obligations or
covenants it may have with third parties or adversely affect in any
material respect Contractor's interests under this Contract.
32.18 ALIGNMENT OF INTERESTS
Contractor agrees to take no materially adverse position (in trade associations,
regulatory bodies, the press, or otherwise) with respect to Purchaser's FCC
licenses or applications therefor associated with the Satellites.
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32.19 EFFECTIVE DATE OF SBN CONTRACT (SBN EDC)
This Contract shall be effective on the date of the last of the following to
occur:
A. The date of execution as specified in the introductory
paragraph of this Contract;
B. Purchaser's written notice to Contractor of its termination of
the HNS Contract;
C. The date of execution by Contractor and HNS of the HNS
Subcontract.
32.20 AUTHORIZATIONS
Each Party represents and warrants that:
A. it has all requisite corporate power and authority to enter
into this Contract and to carry out the transactions
contemplated by this Contract;
B. the execution, delivery, and performance of this Contract and
the consummation of the transactions contemplated by this
Contract have been duly authorized by the requisite corporate
action and do not conflict with any other agreement or
obligation to which it is a party or which binds its assets;
and
C. this Contract is a valid and binding obligation of the Party,
enforceable in accordance with its terms, except each Party
makes no representation or warranty as to the enforceability
of remedies due to applicable bankruptcy, insolvency,
moratorium, reorganization, or similar laws relating to or
affecting the enforcement of creditor's rights or by reason of
general principles of equity.
32.21 COVENANT OF GOOD FAITH
Each Party agrees that, in respect to dealings with the other Party under or in
connection with this Contract, it shall act in good faith.
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ARTICLE 33 - OPTIONS
33.1 SBN PRICE REDUCTION OPTION
33.1.1 Option. Contractor hereby grants to Purchaser an option to reduce the
SBN Firm Fixed Price (as set forth in Item 2 of Article 4.1.1) by up to
the SBN Price Reduction Amount in accordance with the terms of this
Article 33.1 (the "SBN Price Reduction Option").
33.1.2 Step One: Procurement of Third Spacecraft
A. Exercise of Option. To exercise the SBN Price Reduction
Option, Purchaser must, no later than [***](except as extended
pursuant to Article 33.1.7), either:
(i) enter into an agreement to procure from Contractor a
third spacecraft (the "Third Spacecraft"), including
an authority to proceed immediately with the work;
or,
(ii) enter into an agreement to procure the Third
Spacecraft from an industry recognized spacecraft
manufacturer (a "Qualified Manufacturer"), including
an authority to proceed immediately with the work;
provided that prior to entering into such an
agreement, Purchaser has provided Contractor the
opportunity to enter into an agreement with Purchaser
for the procurement of the Third Spacecraft on
Matching Terms (defined in Article 33.1.4), in
accordance with the procedure set forth in Article
33.1.4; and further provided that Contractor has
declined to enter into such agreement in accordance
with Article 33.1.4.
B. Effect of Exercising Option. At the time Purchaser exercises
the SBN Price Reduction Option with respect to the Third
Spacecraft in accordance with Article 33.1.2 A, (i) Contractor
shall apply [***] percent ([***]%) of the SBN Price Reduction
Amount to the SBN Firm Fixed Price (as set forth in Article
4.1.1, Item 2), and as part of this reduction, the amount of
the SBN Acceptance Payment, including any adjustment thereto
pursuant to Article 9.1.4 B as regards Satellite caused
degradations, shall be reduced by [***] percent ([***]%) for
all purposes under this Contract, and the Payment Plan set
forth in Exhibit E-2, SBN Program Payment Plan and Termination
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Liability Amount, shall be adjusted as provided therein for
the exercise of the SBN Price Reduction Option with respect to
the Third Spacecraft.
C. Failure to Exercise SBN Price Reduction Option with Respect to
the Third Spacecraft. If Purchaser does not exercise the SBN
Price Reduction Option with respect to the Third Spacecraft on
or prior to [***] (or later date if extended pursuant to
Article 33.1.7), the SBN Price Reduction Option with respect
to the Third Spacecraft shall expire.
33.1.3 Step Two: Procurement of Fourth Spacecraft
A. Exercise of Option. To completely exercise the SBN Price
Reduction Option, in addition to entering into a contract for
the Third Spacecraft in accordance with Article 33.1.2,
Purchaser must, no later than [***], either:
(i) enter into an agreement to procure from Contractor a
additional spacecraft (the "Fourth Spacecraft"),
including an authority to proceed immediately with
the work; or,
(ii) enter into an agreement to procure the Fourth
Spacecraft from a Qualified Manufacturer, including
an authority to proceed immediately with the work;
provided that prior to entering into such an
agreement, Purchaser has provided Contractor the
opportunity to enter into an agreement with Purchaser
to procure the Fourth Spacecraft on Matching Terms
(defined in Article 33.1.4), in accordance with the
procedure set forth in Article 33.1.4; and further
provided that Contractor has declined to enter into
such agreement in accordance with Article 33.1.4.
For the avoidance of doubt, the "Fourth Spacecraft"
may actually be the third spacecraft if the portion
of the SBN Price Reduction Option is not exercised
under Article 33.1.2, but the portion of the SBN
Price Reduction Option is exercised under Article
33.1.3.
B. Effect of Exercising Option. At the time Purchaser exercises
the SBN Price Reduction Option with respect to the Fourth
Spacecraft in accordance with Article 33.1.3.A, (i) Contractor
shall apply [***] percent ([***]%) of the SBN Price Reduction
Amount to the SBN Firm Fixed Price (as set forth in Article
4.1.1, Item 2), and as part of this reduction, the amount of
the SBN Acceptance payment, including any adjustment thereto
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pursuant to Article 9.1.4 B as regards Satellite caused
degradations, shall be reduced by [***] percent ([***]%) for
all purposes under this Contract (in the event that Purchaser
has also exercised the SBN Price Reduction Option with respect
to the Third Spacecraft, the total reduction in the SBN
Acceptance Payment shall be [***] percent ([***]%)) including
any adjustment thereto pursuant to Article 9.1.4 B as regards
Satellite caused degradation, and the Payment Plan set forth
in Exhibit E-2, SBN Program Payment Plan and Termination
Liability Amount, shall be adjusted as provided therein for
the exercise of the SBN Price Reduction Option with respect to
the Fourth Spacecraft.
C. Failure to Exercise the Fourth Spacecraft Option. If Purchaser
does not exercise the SBN Price Reduction Option with respect
to the Fourth Spacecraft on or prior to [***], the SBN Price
Reduction Option for the Fourth Spacecraft shall expire, but
the SBN Price Reduction Option with respect to the Third
Spacecraft (if exercised under Article 33.1.2) shall remain in
effect.
D. Single Contract. For the avoidance of doubt, Purchaser may
enter into one or two agreements to satisfy the requirements
of Articles 33.1.2 and 33.1.3.
E. Failure to Exercise Option. If Purchaser has exercised the SBN
Price Reduction Option with respect to the Third Spacecraft in
accordance with Article 33.1.2, but does not exercise the SBN
Price Reduction Option with respect to the Fourth Spacecraft
on or prior to [***], or does not exercise the SBN Price
Reduction Option with respect to the Third Spacecraft in
accordance with Article 33.1.2, but does exercise the SBN
Price Reduction Option with respect to the Fourth Spacecraft
on or prior to [***], Purchaser shall only be entitled to
[***] percent ([***]%) of the SBN Price Reduction Option
Amount calculated as set forth above.
33.1.4 Matching Terms. In order to exercise the SBN Price Reduction Option by
way of Articles 33.1.2 A(ii) and/or 33.1.3 A(ii), Purchaser must
provide Contractor with a valid offer to accept a contract to provide
the Third and/or Fourth Spacecraft, as applicable, on the material
terms, in writing (which shall include price, schedule (including the
terms associated with the authority to proceed with the work under such
agreement) and other material terms and conditions, including technical
requirements - the "Matching Terms"), necessary to substantially match
an existing bona fide offer received by Purchaser from the applicable
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Qualified Manufacturer (and if such offer is accepted by Contractor,
entry into an agreement to procure from Contractor the Third and/or
Fourth Spacecraft, as applicable, including an authority to proceed
immediately with the work within ninety (90) days of notice of such
acceptance). The SBN Price Reduction Option shall be deemed effectively
exercised if (i) within fifteen (15) calendar days of Contractor's
receipt of Purchaser's written offer as described above (the "ROFR
Response Period"), Contractor does not accept the offer of a contract
for the Third Spacecraft and/or Fourth Spacecraft, as applicable, from
Purchaser on the Matching Terms; and (ii) Purchaser awards the
contract, including an authority to proceed immediately with the work
for the Third Spacecraft and/or Fourth Spacecraft, as applicable, to
the Qualified Manufacturer on substantially the Matching Terms within
ninety (90) calendar days after the end of the ROFR Response Period.
33.1.5 Purchaser Subsequent Termination. In the event that Purchaser awards
the contract for the Third Spacecraft and/or the Fourth Spacecraft to
either Contractor or a Qualified Manufacturer but thereafter, and prior
to the earlier to occur of (i) 365 calendar days after such award or
(ii) Purchaser's termination liability exceeding [***] U.S. dollars (US
$[***]) for the applicable spacecraft, Purchaser (a) cancels or
terminates [other than for default of the Contractor or Qualified
Manufacturer (as applicable) or due to a force majeure event] such
spacecraft contract with the Contractor or Qualified Manufacturer; (b)
issues a stop work order or orders that, in the aggregate, exceed
ninety (90) days; or (c) modifies such spacecraft contract with the
Qualified Manufacturer in a manner that materially modifies any
Matching Term(s), if any, specified by Contractor in a writing provided
to Purchaser during the ROFR Response Period as the reason(s) for its
declining to offer the Third Spacecraft or Fourth Spacecraft, as
applicable, in such a manner as to have eliminated the reasons for
Contractor's declining to accept a contract from Purchaser for the
Third Spacecraft or Fourth Spacecraft, as applicable, on such Matching
Term(s), as such reasons are specified by Contractor in such notice,
Purchaser shall promptly notify Contractor in writing and shall pay to
Contractor the applicable amounts of the SBN Price Reduction Amount as
and when such amounts would otherwise have been due under the Contract
as if this SBN Price Reduction Option had not been exercised, with any
amount of the SBN Price Reduction Amount which would then be due or
past due to Contractor, to be paid to within thirty (30) calendar days
of Purchaser's notification. For the avoidance of doubt, such
cancellation, termination or modification of the contract for the Third
Spacecraft or Fourth Spacecraft shall not preclude Purchaser from
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subsequently validly exercising the SBN Price Reduction Option within
the time period specified in Articles 33.1.2 and 33.1.3, as may be
extended pursuant to Article 33.1.7 as to the Third Spacecraft.
33.1.6 Confidentiality of Terms. Purchaser shall not be obligated to share
with Contractor any third party confidential information concerning an
offer from any other manufacturer, but shall certify to Contractor the
validity of the Matching Terms. Contractor shall have the right to
request Purchaser to have an audit of the Matching Terms performed by
an independent auditor selected by Purchaser and approved by Contractor
(which approval shall not be unreasonably withheld or delayed) who will
confirm the accuracy and validity of the Matching Terms as well as
confirm that the contract for the Third Spacecraft or Fourth
Spacecraft, as applicable, is awarded to the applicable Qualified
Manufacturer on substantially the Matching Terms. In the event that the
independent audit does not confirm the accuracy and validity of the
Matching Terms or does not confirm that the contract for the Third
Spacecraft of the Fourth Spacecraft is awarded to the Qualified
Manufacturer on substantially the Matching Terms, this Contract shall
not be subject to the SBN Price Reduction Option as set forth above.
33.1.7 Extension of Option Exercise Period. If Purchaser wishes to extend the
SBN Price Reduction Option beyond [***] with respect to the Third
Spacecraft, then Purchaser shall pay, commencing on [***], an amount
equal to [***] percent ([***]%) per [***] on the amount of any SBN
payments deferred as a consequence of Purchaser exercising its rights
to extend the SBN Price Reduction Option beyond [***], as reflected in
Exhibit E-2, SBN Program Payment Plan and Termination Liability Amount.
Any portion of the SBN Price Reduction Option not exercised as of[***],
shall expire, and Purchaser shall immediately make the balance of any
outstanding payments owed pursuant to Exhibit E-2, SBN Program Payment
Plan and Termination Liability Amount.
33.1.8 Termination for Convenience. If Purchaser terminates the SBN and/or SBN
Work for convenience after the SBN Price Reduction Option is exercised
with respect to the Third Spacecraft and/or the Fourth Spacecraft, the
termination liability for such termination shall not exceed US$[***]
(if SBN Price Reduction Option is exercised with respect to either the
Third Spacecraft or the Fourth Spacecraft, but not both) and US$[***]
(if SBN Price Reduction Option is exercised with respect to both the
Third Spacecraft and the Fourth Spacecraft). If Purchaser terminates
the SBN and/or SBN Work for convenience before the SBN Price Reduction
Option is exercised with respect to the Third Spacecraft or the Fourth
Spacecraft, (a) Purchaser shall pay Contractor the applicable
termination liability as set forth in Exhibit E-2, and (b) if and when
Purchaser subsequently exercises the SBN Price Reduction Option
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associated with the Third Spacecraft and/or the Fourth Spacecraft,
Contractor shall refund to Purchaser the difference between the
termination liability paid by Purchaser and US$[***] (if SBN Price
Reduction Option is exercised with respect to either the Third
Spacecraft or the Fourth Spacecraft, but not both) or US$[***] (if SBN
Price Reduction Option is exercised with respect to both the Third
Spacecraft and the Fourth Spacecraft).
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33.2 SBAS- RELATED OPTIONS
Purchaser may exercise any one or more of the options described in this Articles
33.2.1 through 33.2.5 (each, an "Option"). The exercise of any Option shall be
effective upon delivery by Purchaser to Contractor of a written notice
referencing such Option and stating that Purchaser is exercising that Option.
Purchaser shall be solely responsible for all costs associated with any
applicable taxes, duties, and customs that may be assessed. The validity of
prices for each Option is identified under the description of each option.
Purchaser and Contractor shall mutually agree upon new prices upon expiration of
the validity period.
33.2.1 Option for Annually Renewable Warranty
(a) Purchaser shall have the right to extend the Warranty Period
applicable to the SBAS Operational Component, [***], for a
period of [***] from the date of Preliminary Acceptance.
(b) Purchaser must order this Option [***] in advance of the
commencement date for the Extended Warranty Period (defined
below).
(c) If exercised, Contractor shall provide hardware and software
warranty for the SBAS Operational Component for a period of
[***] ("Extended Warranty Period"). Warranty services provided
during the Extended Warranty Period shall be consistent with
those provided during the Warranty Period.
(d) The Extended Warranty Period shall commence immediately upon
expiration of the previous [***].
(e) This Option remains valid for a period of [***] from the date
of Preliminary Acceptance.
(f) Purchaser shall have the right to procure this Option at the
price defined in Table 1.2 (item 1.0) of Exhibit E-1, SBAS
Program Payment Plan. The price detailed in Table 1.2 shall be
valid for [***] following Preliminary Acceptance.
(g) The payment schedule for this Option is as follows:
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o [***]% to be paid upon commencement of the Extended
Warranty Period.
o [***] equal payments of [***]% at the end of each
[***] interval during the Extended Warranty Period.
33.2.2 Operations and Maintenance for the U.S. Ground Station [Expired].
-----------------------------------------------------------------
(a) Contractor shall operate and maintain the US Ground Station
(located in Las Vegas, Nevada) for the Initial Operations
Period of [***]. The operations and maintenance team shall
consist of four (4) personnel. Operations and maintenance
shall be provided on a 24 x 7 basis for the following
equipment:
[***]
[***]
[***]
[***]
[***]
(b) This Option remains valid through [***]. If this Option is
exercised, the Contractor shall extend the availability of
this option for a period of [***] at a price to be mutually
agreed.
(c) The Customer shall have the right to procure this Option at
the price defined in Table 1.2 (item 1.0) of Exhibit E-1, SBAS
Program Payment Plan. The price defined in Table 1-2 remains
valid until [***].
(d) The payment schedule for this Option is as follows:
o 20% upon order
o Eight (8) equal payments of 10% at the end of each
three (3) month interval during the Initial
Operations Period.
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33.2.3 Option for Two Additional Ground Stations for Second Satellite
[Expired].
(a) Contractor shall deliver one (1) additional SBAS Operational
Component (with two (2) additional Ground Stations) to be
located at Las Vegas, Nevada and Allan Park, Ontario ("Second
SBAS Operational Component") and integrated with a second
satellite. The Second SBAS Operational Component shall meet
the same specifications as defined in Exhibit B-1, SBAS
Performance Specification and Exhibit D-1, SBAS Test Plan.
(b) Contractor shall be responsible for the design, development,
fabrication, implementation, integration, delivery,
performance verification, and testing of the Second SBAS
Operational Component that includes the following:
[***]
[***]
[***]
[***]
[***]
[***]
(c) Contractor shall be responsible for preparing the equipment
for shipment, shipping costs, insurance and delivering
equipment to the designated site.
(d) The Second SBAS Operational Component shall be delivered and
tested [***] months after receipt of order but no earlier than
[***] months after the date of Preliminary Acceptance.
Contractor shall deliver the Second SBAS Operational Component
in accordance with the following schedule:
[***]
[***]
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[***]
[***]
[***]
[***]
(e) It has been assumed that this new system will meet the same
performance criteria as the first SBAS Operational Component.
As such, Contractor has not priced for PDR, SRR and CDR design
reviews; these will be replaced with one design review only.
As the two (2) additional Ground Station configurations will
be located at the same sites as the initial delivery,
Contractor has not priced for additional training courses and
IOT support. Warranty is not provided as part of this option
and subject to separate procurement.
(f) For any delay of Final Acceptance of the Second System that is
due to the late availability of CFE, Article 6.4 shall apply.
(g) Purchaser shall have the right to procure this Option at the
price defined in Table 1.2 (item 3.0) of Exhibit E-1, SBAS
Program Payment Plan. The price defined in Table 1-2 remains
valid through [***].
(h) This Option remains valid through [***].
(i) The payment terms shall be mutually agreed at the time this
Option is exercised.
33.2.4 Software Realtime Graphic Tool
(a) Contractor shall be responsible for the development and
delivery of a "Software Real Time Graphic" module that
displays statistics and trends of the SBAS beam forming entity
in real-time on a Graphical User Interface (GUI). Data that
will be displayed includes pointing corrections plus
calibration measurements in the forward and return links. The
display of this information will be refreshed periodically at
the GUI.
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(b) Contractor shall deliver the tool to each of the Ground
Stations [***] after receipt of notice of Purchaser's exercise
of this Option, but no earlier than the date of Preliminary
Acceptance.
(c) This Option remains valid through [***].
(d) Purchaser shall have the right to procure this Option at the
price defined in Table 1.2 (item 4.0) of Exhibit E-1, SBAS
Program Payment Plan. The price defined in Table 1-2 remains
valid through [***] [Expired].
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(e) The payment schedule for this Option is as follows:
[***]
[***]
[***]
[***]
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ARTICLE 34 - SECURITY INTEREST
34.1 GRANT OF SECURITY INTEREST
As security for the performance by Contractor of the Secured Obligations the
Contractor hereby grants to Purchaser, and pursuant to Section 364 of the
Bankruptcy Code, Purchaser shall have, a valid, binding, enforceable and
perfected first priority lien on and security interest in (collectively, the
"Security Interest") all of Contractor's right, title and interest in, to and
under the following property, whether now owned or hereafter acquired by
Contractor and whether now existing or hereafter coming into existence
(collectively, the "Collateral"):
A. all Raw Materials, Work-in-Process and Finished Goods; and
B. all proceeds (as defined in the UCC) of any of the foregoing.
Except as otherwise specifically provided herein, the Security Interest shall
not be subordinate or pari passu with any other lien or security interest or
right of setoff or recoupment, and no lien or security interest or right of
setoff or recoupment shall be permitted which shall be senior to or pari passu
with the Security Interest. The grant of the Security Interest pursuant to this
Article 34.1 is not in derogation of Purchaser's rights as owner of any Raw
Materials, Work-in-Process and Finished Goods as to which title has passed to
Purchaser, and remains in Purchaser, as provided in this Contract. This Security
Interest shall automatically terminate upon Intentional Ignition (as defined in
the Satellite Contract) or shall be released and extinguished pursuant to
Article 19.2, 21.1.2, 21.1.5 and 21.2.3. Notwithstanding the foregoing or any
other provision of this Contract, no Security Interest shall apply to Collateral
existing or hereafter coming into existence under the HNS Subcontract except as
and to the extent Contractor acquires title to such Collateral under the HNS
Subcontract.
34.2 RIGHT TO MAKE FILINGS
Should Purchaser, in its sole discretion (but not as a requirement hereunder),
from time to time choose to file financing statements or other notices,
instruments, agreement and documents or take other action to validate or perfect
the Security Interest and in furtherance of the grant of the Security Interest
pursuant to Article 34.1, Contractor shall, and does hereby irrevocably
authorize on behalf of Contractor and as Contractor's attorney-in-fact to give,
execute, deliver, file, record, obtain, and authorize all financing statements
and any other notices, instruments, agreements and documents, and take such
other action as reasonably requested by Purchaser, to (i) create, perfect,
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validate and preserve such Security Interest and the priority thereof and (ii)
enable Purchaser to exercise and enforce its rights hereunder with respect to
such Security Interest (and all such documents and instruments shall be deemed
to have been filed or recorded at the time and on the date of the entry of the
Bankruptcy Order).
34.3 CORPORATE RECORDS
In furtherance of the grant of the Security Interest pursuant to Article 34.1,
Contractor shall indicate in Contractor's corporate records the Security
Interest that Purchaser has in the Collateral to the extent provided in this
Article 34.
34.4 PERFECTED SECURITY INTEREST
Contractor represents and warrants that the Security Interest granted to
Purchaser constitutes a legal, valid and enforceable first priority security
interest therein and upon the filing of UCC-1 financing statements in the office
of the Secretary of State of Delaware will be a perfected security interest in
those items that can be perfected by filing under the UCC subject to no other
liens or security interests other than after-acquired Junior Liens (as defined
below). Contractor acknowledges that Purchaser's execution and delivery of this
Contract provides value to Contractor.
34.5 JUNIOR LIENS
Contractor shall not lend, rent, lease, transfer, pledge, grant a security
interest in, or otherwise dispose of or encumber any portion of the Collateral
or any right, title or interest therein except to Purchaser pursuant to this
Contract and Contractor shall keep the Collateral free from any security
interest, lien, encumbrance or claim. Notwithstanding the foregoing, Contractor
shall be permitted to grant "silent" junior liens ("Junior Liens") on the
Collateral to secure indebtedness of Contractor and its Affiliates from time to
time, including without limitation reimbursement obligations in respect of
letters of credit (collectively, "Permitted Debt"), provided that the terms of
such Junior Liens shall be reasonably acceptable to Purchaser. Prior to granting
any Junior Lien on the Collateral, Contractor shall provide written notice to
Purchaser describing the circumstances of such Junior Lien (including without
limitation the identity of the proposed holder of such Junior Lien and the
nature of the Permitted Debt). Within ten (10) Business Days after receipt of
such notice, Purchaser shall provide the terms for such Junior Lien that would
be reasonably acceptable to Purchaser. Contractor agrees and acknowledges that
such reasonable terms may prohibit the holder of such Junior Lien from seizing,
foreclosing on, selling or otherwise disposing of the Collateral or exercising
other rights as a secured party, and may include requirements that the holder of
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the Junior Lien hold in trust for Purchaser any amounts received in respect of
the Collateral, so long as the Security Interest in favor of Purchaser remains
in effect.
34.6 PERIODIC INVENTORY
Upon the reasonable request of Purchaser, Contractor shall provide Purchaser a
written inventory describing the Raw Materials, Work-in-Process and Finished
Goods as of the time of such request.
34.7 REMEDIES
Purchaser shall have and be entitled to exercise all the rights and remedies
with respect to the Collateral of a secured party under the UCC (whether or not
the UCC is in effect in the jurisdiction where Purchaser asserts the rights and
remedies), such additional rights and remedies as provided in this Contract, and
such additional rights and remedies to which a secured party is entitled under
the laws in effect in any jurisdiction where Purchaser may assert its rights and
remedies. Upon termination of this Contract pursuant to Article 21.1, or upon a
termination by Contractor under Article 21.2.4 that is determined to have been
wrongful, Purchaser shall have the right, subject to applicable export control
restrictions and security regulations, to take possession of the Collateral or
any part thereof upon ten (10) days notice to Contractor for the purpose of
effecting a sale or other disposition of the Collateral. Notwithstanding any
provision of this Contract to the contrary, Purchaser shall not be permitted to
exercise any remedy as a secured party in respect of the Security Interest
granted hereunder unless (i) Purchaser has terminated this Contract in whole
pursuant to, and within the time limits provided in, Article 21.1 or (ii)
Contractor has wrongfully terminated this Contract under Article 21.5, and in
either case, Purchaser retains a Security Interest as provided in this Article
34 and Contractor has failed to perform its obligations in such circumstances
pursuant to Article 21 within thirty (30) days after required to do so (with
respect to Contractor, a "Termination Default").
34.8 DEFICIENCIES
If the proceeds of sale, collection or other realization of or upon the
Collateral pursuant to Article 34.7 or otherwise are insufficient to cover the
amounts due in clauses (i) and (ii) of the first sentence of Article 34.9,
Contractor shall remain liable for any deficiency. Purchaser shall not incur any
liability as a result of the sale of the Collateral, or any part thereof, at any
private sale pursuant to Article 34.7 conducted in a commercially reasonable
manner and otherwise in compliance with the UCC and applicable export control
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restrictions. Contractor hereby waives any claims against Purchaser arising by
reason of the fact that the price at which the Collateral may have been sold at
such a private sale was less than the price that might have been obtained at a
public sale or was less than the aggregate amount of the Secured Obligations,
even if Purchaser accepts the first offer received and does not offer the
Collateral to more than one offeree, so long as the sale was conducted in a
commercially reasonable manner.
34.9 APPLICATION OF PROCEEDS
The proceeds of any collection, sale or other realization of all or any part of
the Collateral pursuant to Article 34.7 shall be applied in the following order:
(i) first, to the payment of the reasonable costs and expenses of such
collection, sale or other realization; (ii) second, to the payment in full of
the Secured Obligations, and (iii) third, to the payment to the Contractor, or
its respective successors or assigns, or as a court of competent jurisdiction
may direct, of any surplus then remaining.
34.10 LIMITED POWER OF ATTORNEY
Without limiting any rights or powers granted by this Article 34 to Purchaser
while no Termination Default has occurred and is continuing, upon the occurrence
and during the continuance of any Termination Default, Purchaser is hereby
appointed the attorney in fact of Contractor for the purpose of carrying out the
provisions of this Security Interest and taking any action and executing any
instruments that Purchaser may deem necessary or advisable to accomplish the
purposes hereof, which appointment as attorney in fact is irrevocable and
coupled with an interest.
34.11 CONTRACTOR COOPERATION
Contractor agrees that, from time to time upon the written request of the
Purchaser, Contractor will execute and deliver such further documents and do
such other acts and things as Purchaser may reasonably request in order fully to
effect the purposes of this Article 34.
34.12 INTELLECTUAL PROPERTY RIGHTS
In connection with the exercise by Purchaser of its rights as a secured party
hereunder, Contractor hereby grants to Purchaser, to any person acquiring rights
in the Collateral as the result of the sale, collection or other realization of
or upon the Collateral, and to any successor owner of the Collateral, the
Intellectual Property rights and rights in data specified in Article 31, which
rights shall survive any termination of this Contract.
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34.13 SURVIVAL OF SECURITY INTEREST
The Secured Obligations of Contractor and the rights, claims and priorities of
Purchaser granted herein shall continue beyond and remain unimpaired and
unaffected by any termination of this Contract.
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IN WITNESS WHEREOF, the Parties have executed this Contract by their
duly authorized officers as of the date set forth in the Preamble.
Space Systems/Loral, Inc. TerreStar Networks Inc.
By: /s John Celli By: /s Neil Hazard
---------------------------- -------------------------
Name: John Celli Name: Neil Hazard
---------------------------- ----------------------------
Title: President, COO Title: Chief Financial Officer
---------------------------- ----------------------------
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ATTACHMENT A
FORM OF INVOICE
[Date]
TerreStar Networks Inc.
12010 Sunset Hills Road
Reston, VA 20190
Attention:_____
RE: Terms and Conditions of the TerreStar Space Based Network Purchase
Contract, dated as of __________ (as amended, supplemented or modified
from time to time, the "TerreStar Purchase Contract"), between
TERRESTAR NETWORKS INC, ("PURCHASER" OR "TERRESTAR") and SPACE
SYSTEMS/LORAL, INC. ("CONTRACTOR")
Ladies and Gentlemen:
This Invoice is delivered to TerreStar pursuant to Article 5 of the TerreStar
Purchase Contract and constitutes Contractor's request for payment in the amount
of $__________ for Milestone Payment No.__________ /Time Payment No.__________.
Very truly yours,
SPACE SYSTEMS/LORAL, INC.
By: _________________________________________________
Title: ______________________________________________
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ANNEX I TO ATTACHMENT A
FORM OF CONTRACTOR CERTIFICATE
Reference: Milestone Payment No. __________/Time Payment No.___________.
[Date]
TerreStar Networks Inc.
12010 Sunset Hills Road
Reston, VA 20190
Attention: Treasurer
RE: Terms and Conditions of the TerreStar Space Based Network Purchase
Contract, dated as of __________ between TERRESTAR NETWORKS INC.
("PURCHASER" OR "TERRESTAR") and SPACE SYSTEMS/LORAL, INC.
("CONTRACTOR") (as amended, supplemented or modified from time to time,
the "TerreStar Purchase Contract")
Ladies and Gentlemen:
This Certificate is delivered to you pursuant to Article 5 of the Terms and
Conditions of the TerreStar Purchase Contract. Each capitalized term used herein
and not otherwise defined shall have the meaning assigned thereto in the Terms
and Conditions of the TerreStar Purchase Contract.
We hereby certify, after due inquiry, that, as of the date hereof:
1. The TerreStar Purchase Contract is in full force and effect
and except as set forth in Schedule I hereto.
2. Except as set forth in Schedule I hereto, we are not aware of
any event that has occurred or failed to occur which
occurrence or non-occurrence, as the case may be, could
reasonably be expected to cause the date of Delivery of any
Deliverable Item under the TerreStar Purchase Contract to
occur later than the Delivery date therefor.
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3. Except as set forth in Schedule I hereto, no event or
condition is known to exist that permits or requires us to
cancel, suspend, or terminate our performance under the
TerreStar Purchase Contract or that could excuse us from
liability for non-performance thereunder.
4. Except with respect to amounts that are the subject of a
Dispute or are overdue (such overdue amounts and such disputed
amounts being described in reasonable detail in Schedule II
hereto), all amounts due and owing to us have been paid in
full through the date of the immediately preceding Contractor
Certificate and are not overdue.
5. a. The amount contained in the Invoice delivered to you
concurrently herewith in accordance with the terms of
Article 5 of the Terms and Conditions of the
TerreStar Purchase Contract represents monies owed to
us in respect of Milestone Payment No. /Time Payment
No. .
b. The amount referred to in paragraph (a) above was
computed in accordance with the terms of the
TerreStar Purchase Contract.
c. The Milestone to which Milestone Payment No. relates
has been completed in accordance with the TerreStar
Purchase Contract (this only applies to invoices for
Milestone payments).
Very truly yours,
SPACE SYSTEMS/LORAL, INC.
By: _________________________________________________
Title: ______________________________________________
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SCHEDULE I TO
ANNEX I TO ATTACHMENT A
List of Exceptions:
Amendments to TerreStar Purchase Contract:
Exceptions Affecting Final Acceptance Date:
Exceptions Affecting Contractor's Performance:
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ATTACHMENT B
KEY PERSONNEL
--------------------------------------------------------
Key Personnel Position Individual
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[***] [***]
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[***] [***]
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[***] [***]
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--------------------------------------------------------
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Exhibit A-1
SBAS Statement of Work (SOW)
Revision 3.1 December 1, 2006
Space Systems/Loral
3825 Fabian Way
Palo Alto, California 94303 _____________________________________
TerreStar Networks, Inc.
One Discovery Place
12010 Sunset Hills Road
6th Floor
Reston, Virginia 20190 _____________________________________
Revision 3.1
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- --------------------------------------------------------------------------------
This document contains data and information proprietary to Space Systems/Loral,
Inc. and TerreStar Networks Inc. This data is being furnished pursuant to the
provisions of the Contract between TerreStar Networks Inc. and Space
Systems/Loral, Inc. for the TerreStar Satellite Program. Space Systems/Loral,
Inc. and TerreStar Networks Inc. shall have the right to duplicate, use or
disclose the data and information to the extent specified in the Purchase
Contract.
- --------------------------------------------------------------------------------
The data/information contained herein has been reviewed and approved for release
by Space Systems/Loral Export Administration on the basis that this document
contains no export-controlled information.
- --------------------------------------------------------------------------------
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1.0 Introduction
The TerreStar Satellite Access Network (SAN) is a component of the overall
TerreStar Hybrid Network. To this end, a contract for the procurement of the
TerreStar Satellite has already been signed with Contractor for delivery and
launch during the fourth quarter of 2007.
The TerreStar Satellite relies on the availability and functions of a Satellite
Beam Access Subsystem (SBAS) Operational Component that effectively complement
the Satellite payload by using a Ground Based beam Former (GBBF) for the
formation and placement of the [***] S-band user spot beams over the Satellite's
coverage area of Canada, the 50 U.S. States, Puerto Rico, and US Virgin Island
(the "Coverage Area").
This SOW addresses the deliverables for the SBAS. Other entities making up the
Satellite Access Network (SAN) will be procured separately. Figure 1-1 below
depicts the planned deployment topology of the SAN as part of the TerreStar
Hybrid Network.
[***]
Figure 1-1: TerreStar Hybrid Network Architecture
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2.0 Scope
This Statement Of Work (SOW) document defines and details the SBAS-associated
work to be performed by Contractor in full compliance with the other documents
under this Contract. The SBAS works in conjunction with the TerreStar Satellite,
and consequently, Contractor shall ensure interface compatibility.
3.0 Applicable Documents
o Contract Terms and Conditions
o Satellite Beam Access Subsystem, Functional and Performance Requirements
Specifications (SRS) - Functional and Performance Specification, Exhibit
B-1
o Satellite Beam Access Subsystem, Program Test Plan, Exhibit D-1
o Pricing, Payment Schedule and Options, Exhibit E-1
4.0 SOW Deliverables
Contractor shall deliver to Purchaser all SBAS deliverables as listed in Table
4-1 in accordance with the Contract and as described more fully in the
subsequent sections of this SOW document.
Table 4-1: SBAS SOW Deliverable Items
==================================================================================================================
SOW ITEM # DESCRIPTION QTY DELIVERY DATE REMARKS
- ------------------------------------------------------------------------------------------------------------------
1. SBAS Operational Component Lot Sec. 4.1
- ------------------------------------------------------------------------------------------------------------------
1.1 Ground Stations 2 [***] Sec 4.1.1
- ------------------------------------------------------------------------------------------------------------------
1.1.1 GBBF Entity 2 [***] Sec. 4.1.1.1
- ------------------------------------------------------------------------------------------------------------------
1.1.2 FES Entity 2 [***] Sec. 4.1.1.2
- ------------------------------------------------------------------------------------------------------------------
1.1.3 CMS Entity 2 [***] Sec. 4.1.1.3
- ------------------------------------------------------------------------------------------------------------------
1.2 Associated Ground Equipment Lot [***] Sec 4.1.2
- ------------------------------------------------------------------------------------------------------------------
1.2.1 CES Entity [***] [***] Sec. 4.1.2.1
- ------------------------------------------------------------------------------------------------------------------
1.2.2 Terrestrial Transmission Facilities for Lot [***] Sec. 4.2.2.2
CES
- ------------------------------------------------------------------------------------------------------------------
1.3 System Software and Licenses Lot [***] Sec. 4.1.3
- ------------------------------------------------------------------------------------------------------------------
2 SBAS Test Deliverables Lot [***] Sec. 4.2
- ------------------------------------------------------------------------------------------------------------------
2.1 Satellite Simulator 1 [***] Sec. 4.2.1
- ------------------------------------------------------------------------------------------------------------------
2.2 GBBF Emulator for Satellite Factory Tests 1 [***] Sec. 4.2.2
Note: GBBF Emulator uses deliverable SBAS
equipment.
- ------------------------------------------------------------------------------------------------------------------
2.3 S-BSS Emulator 1 [***] Sec. 4.2.3
- ------------------------------------------------------------------------------------------------------------------
2.4 Test Tools 1 [***] Sec. 4.3
- ------------------------------------------------------------------------------------------------------------------
3 Spare Parts Lot [***] Sec. 4.3
==================================================================================================================
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==================================================================================================================
SOW ITEM # DESCRIPTION QTY DELIVERY DATE REMARKS
==================================================================================================================
4 Deliverable Services Lot Sec. 4.4
- ------------------------------------------------------------------------------------------------------------------
4.1 System Operation Training Lot [***] Sec 4.4.1
- ------------------------------------------------------------------------------------------------------------------
4.2 Satellite Factory Test Support Lot [***] Sec. 4.4.2
- ------------------------------------------------------------------------------------------------------------------
4.3 Operations Support Lot [***] Sec. 4.4.3
- ------------------------------------------------------------------------------------------------------------------
4.4 Ground Stations and CES Operational Site Lot [***] Sec. 4.4.4
Facilities
- ------------------------------------------------------------------------------------------------------------------
4.5 Permits Lot [***] Sec. 4.4.5
- ------------------------------------------------------------------------------------------------------------------
4.6 Other Services Lot [***] Sec. 4.4.6
- ------------------------------------------------------------------------------------------------------------------
5 Deliverable Data Lot Sec. 4.5
- ------------------------------------------------------------------------------------------------------------------
5.1 Program and Management Documentation Lot Per CDRL Table 8-1
- ------------------------------------------------------------------------------------------------------------------
5.2 System Design Documentation Lot Per CDRL Table 8-2
- ------------------------------------------------------------------------------------------------------------------
5.3 System Development and Fabrication Docs Lot Per CDRL Table 8-3
- ------------------------------------------------------------------------------------------------------------------
5.4 System Operations and Maintenance and Lot Per CDRL Table 8-4
Training Documentation
==================================================================================================================
The world "Entity" in Table 4-1 refers to a deliverable item or group of items
intended for a specific function.
4.1 The SBAS Operational Component
Contractor shall design, develop, manufacture, transport, install, configure,
and test an SBAS Operational Component consisting of two (2) fully operational
Ground Stations, each comprising of a Ground-Based-Beam Forming (GBBF) entity,
Feeder link Earth Station (FES) entity and a Control and Management System
(CMS), as described in Section 4.1.1 of this SOW.
The SBAS Operational Component shall also include Associated Ground Equipment as
described in Section 4.1.2 of this SOW and System Software and Licenses, as
required to operate the SBAS Operational Component and as detailed in Section
4.1.3 of this SOW.
The SBAS Operational Component shall be in full compliance with the details
provided in the Functional and Performance Requirements Specifications of
Exhibit B-1.
4.1.1 SBAS Ground Stations
Each Ground Station shall include three main elements as detailed in the
following sections:
o GBBF
o FES
o CMS
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4.1.1.1 GBBF
The GBBF entity at each Ground Station shall support beam forming according to
the requirements of Exhibit B-1, SBAS Functional and Performance Requirements
Specifications.
4.1.1.2 FES
The FES entity for each Ground Station shall be designed and configured for
simultaneous transmission of both communications and satellite Tracking,
Telemetry and Commands (TT&C) traffic. The two FESs will function as the primary
and backup TT&C stations for normal in-orbit operations of TerreStar-1. The TT&C
shall commence operations after orbit raising.
In addition, the two FES entities will be used as the payload test earth
stations during the Satellite In-Orbit Test (IOT). A set of precision coupling
ports shall be provided along the RF transmit and receive paths for signal
injections and power measurements. The exact location for this IOT coupling
ports, as well as the desired coupling coefficients, will be defined by
Purchaser no later than CDR.
4.1.1.3 CMS
The CMS shall be provided as a centralized, standalone system complete with the
required processing software, database, computer system, operating console and
displays.
The interface definition between NOMC and CMS, payload data format and ephemeris
data format shall be proposed by Contractor and approved by Purchaser by PDR.
4.1.2 SBAS Associated Ground Equipment
The SBAS Associated Ground Equipment shall include elements that are shared
between the two Ground Stations included in the SBAS Operational Component, as
detailed in the following sections:
o CES
o TTF
4.1.2.1 Calibration Earth Stations
It is anticipated that proper GBBF operations in the SBAS Operational Component
shall require the deployment of a network of Calibration Earth Stations (CES)
throughout the Satellite Coverage Area, shared by the two Ground Stations.
Contractor shall deliver [***] but agrees to deliver a maximum of [***] if by
Final Acceptance (FA), analysis determines additional CES entities are required.
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4.1.2.2 Terrestrial Transmission Facilities for CES
All Calibration Earth Stations (CES) throughout the Satellite Coverage Area
shall be connected to the GBBF entity at the two Ground Stations of the SBAS
through a collection of Terrestrial Transmission Facilities (TTF).
Contractor shall design, develop, provide, transport, assemble, configure,
install and test all TTF, including the design, development, provision,
installation and integration of the communications network between and among the
SBAS Components and the CESs. Contractor shall negotiate all long-haul
interconnection circuit leases and service agreements required between
Components of the SBAS on behalf of Purchaser in accordance with Section 9.2
hereof. Purchaser shall be party to and liable under such agreements (not
Contractor) and pay any such third party service provider directly for such
leases and communication services. For the avoidance of doubt, notwithstanding
Contractor's obligation to negotiate the aforementioned agreements on behalf of
Purchaser, it is understood and agreed that all long-haul interconnection
circuit leases and service agreements required between Components of the SBAS
including, but not limited to, the execution, operation and maintenance of the
applicable leases, shall be considered as Purchaser-Furnished Items as that term
is defined in Article 6 of the Contract. Contractor is responsible for
providing, as a Deliverable Item, all customer-premises equipment ("CPE") that
is not supplied by the long-haul interconnection circuit service provider and
for maintaining such CPE during the Initial Operations Period.
4.1.3 System Software Maintenance and License
Contractor shall procure or provide in Purchaser's name, full maintenance and
licensing agreements covering the entire collection of software modules. This
includes licenses to all foreground software, embedded or otherwise, developed
by Contractor or its subcontractors or purchased from third party suppliers (to
the extent possible), used in the implementation of the System.
All third party supplied software licenses shall be in the most current version
supported at the time of three months prior to Preliminary Acceptance (PA).
These provisions also apply to the optional SBAS operational support during the
initial and extended operations periods.
4.2 SBAS Test Deliverables
The test tools for the SBAS include some dedicated simulators and emulators plus
generic test tools required for proper day to day operations of the SBAS.
Contractor shall design, develop and test SBAS Test Deliverables including:
o Satellite Simulator
o GBBF Emulator
o S-BSS Emulator
o Test Tools
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Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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4.2.1 Satellite Simulator
In support of performance testing of the GBBF, Contractor shall develop test
equipment referred to as the Satellite Simulator as described in the document,
SBAS Program Test Plan, Exhibit D-1.
4.2.2 GBBF Emulator for Satellite Factory Tests
In support of the satellite factory tests in areas of beam forming
functionality, Contractor shall develop test equipment referred to as the GBBF
Emulator as described below. The GBBF Emulator shall use deliverable hardware
components that will become one of the Ground Station GBBF configurations. It is
understood that these GBBF hardware components will be delivered to the site and
be included into the GBBF configuration as soon as the GBBF Emulator is no
longer required.
The GBBF Emulator is used to test the Satellite before launch. Owing to the
difficulty of reproducing all the GBBF test conditions with an in situ
satellite, the tests performed will be a limited subset of the GBBF tests
described in Exhibit D-1, SBAS Program Test Plan. As a part of the system design
phase, Contractor shall propose a test plan for the GBBF Emulator. While the
details of the test plan are Contractor's responsibility to propose, the test
plan must, as a minimum, accomplish the following objectives:
- Create plots of the forward and return patterns formed by the
Satellite and the GBBF together, when the GBBF is commanded to form a
beam in a given direction
- There is no need to test the calibration function of the GBBF in these
tests [these will be tested in the GBBF tests with the Satellite
Simulator (SS) and the S-BSS Emulator].
During the system design phase, Contractor shall determine the functions and
interfaces of the GBBF Emulator.
The GBBF Emulator is expected to use deliverable equipment to be installed at
the second Ground Station. For this reason, after conclusion of the
compatibility tests with the Satellite, Contractor may ship the components of
the GBBF Emulator to the second Ground Station for installation, test, and
acceptance. Contractor shall provide Purchaser with reasonable prior written
notice of its need to ship to the second Ground Station in order to comply with
the schedule requirements of this Contract. Contractor shall not have any
liability or suffer any penalties for schedule delays caused by Purchaser's
directions to delay the shipment of the components of the GBBF Emulator beyond
the need date so notified to Purchaser; provided that the primary reason for
giving the direction to delay shipment is not due to the actions or inactions of
Contractor, and provided further that the need date is at least 21 days after
the date the GBBF Emulator is delivered to, and made available at, the location
specified for Satellite compatibility testing.
4.2.3 S-BSS Emulator
In support of performance testing of the GBBF, Contractor shall develop test
equipment referred to as the Satellite Simulator as described in Exhibit D-1,
SBAS Program Test Plan.
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Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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4.2.4 Test Tools
Contractor shall provide a list of recommended test tools required for daily
operations and maintenance of the SBAS by CDR.
4.3 Spare Parts
By CDR, Contractor shall provide a list of recommended Spare Parts required for
daily operations and maintenance of the SBAS, including a list of all
mission-critical replacement level parts, and a plan for maintaining the Spare
Parts. Such plan shall take into account delivery times for limited source and
long-lead items. During the Initial Operations Period, Contractor shall maintain
and replenish a Spare Parts inventory in accordance with such plan. At the end
of the Initial Operations Period, the Spare Parts inventory shall be
fully-replenished by Contractor.
A list of maintenance service contracts for part or all of the SBAS for warranty
operations shall be provided at the beginning of the Warranty Period. After the
Warranty Period, Contractor shall guarantee that Spare Parts are available for
purchase for a period of five (5) years. Purchaser shall be given notice for
last time buy with six (6) months notice. Spare Parts will be delivered to the
Ground Station sites or to a central location identified by Contractor or
Purchaser for Spares Parts common to both Ground Stations.
4.4 Deliverable Services and Data
Contractor shall provide services and submit a complete set of data capturing
the outputs of the system design phase as detailed in Section 8, the Contract
Data Requirements List (CDRL).
4.4.1 System Operations Training
The System Operations Training shall be based on the training documentation
described in Section 4.5 of this SOW. Training shall be conducted for a team of
maximum ten (10) people at the HNS facilities. The training shall be conducted
in two parts. The first part shall consist of the FES training at one of the
sites (USA site TBC at PDR). The second part shall consist of the GBBF/CMS/CES
training at one of the sites (USA site TBC at PDR). Both training parts shall be
completed after site installation and before acceptance of the FES and
GBBF/CMS/CES.
4.4.2 Satellite Factory Test Support
Contractor shall provide system-level technical support in utilizing the GBBF
Emulator to test the Satellite at the Satellite test facilities in Palo Alto,
CA.
4.4.3 SBAS Operational Support
As an option, Contractor shall provide SBAS operational support as per Article
33.2 of the Contract.
Revision 3.1
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Exhibit A-1
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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4.4.4 Ground Stations and CES Operational Site Facilities
Contractor shall survey the Satellite Ground Station Operational Sites at Allan
Park (Ontario) and Las Vegas (Nevada), provide by CDR a detailed schedule of,
and complete execution by [***] of all civil works, including
buildings/shelters, antenna pads, physical security, fencing and all
electro-mechanical works, primary electrical power, air conditioning,
ventilation TTF interface, etc. required to support the full operations of each
SBAS site throughout its operational life, and consistent with the performance
availability requirements of the Exhibit B-1, SBAS Functional and Performance
Requirements Specifications.
The CES locations (up to [***]) shall be identified by Contractor and approved
by Purchaser, all in accordance with Section 9.2. Thereafter, Contractor, shall
negotiate the necessary arrangements for the CES sites including lease/rental
agreements for site usage, civil works, site improvements, utilities, TTF
hook-up, in accordance with Section 9.2 hereof and Contractor shall provide O&M
of the CES entities during the Warranty Period. With respect to the CES sites,
Contractor shall not be responsible for any civil works, including build-out,
shelters, antenna pads, physical security, fencing, electro-mechanical works,
primary electrical power, air conditioning, and ventilation. For the avoidance
of doubt, notwithstanding Contractor's obligation to negotiate the necessary
arrangements for the CES sites including lease/rental agreements for site usage,
civil works, site improvements, utilities, and TTF hook-up on behalf of
Purchaser, it is understood and agreed that all such items including, but not
limited to, the execution, operation and maintenance of the applicable leases
and any civil works that may be required shall be considered as
Purchaser-Furnished Items as that term is defined in Article 6 of the Contract.
Contractor shall also obtain, on Purchaser's behalf, all rights and real
property leases necessary to build, operate and maintain the SBAS in accordance
with the applicable Performance Specifications, except for leases for the real
property upon which the two (2) Ground Stations will be located. Contractor
shall negotiate all such rights and leases on behalf of Purchaser in accordance
with Section 9.2 hereof, with all such agreements being subject to Purchaser's
review and approval. Purchaser shall be party to and liable under such
agreements (not Contractor) and shall pay any such third party lessors directly.
For the avoidance of doubt, notwithstanding Contractor's obligation to negotiate
aforementioned rights and leases on behalf of Purchaser, it is understood and
agreed that all such items including, but not limited to, the execution,
operation and maintenance of the applicable leases shall be considered as
Purchaser-Furnished Items as that term is defined in Article 6 of the Contract.
4.4.5 Permits
Contractor shall identify, procure and maintain all applicable federal, state,
county, local and foreign licenses, approvals, inspections, permits and
certificates (collectively "Permits") necessary to perform its obligations under
the Contract, including all export and import Permits and all Permits related to
the installation of the SBAS. Purchaser will provide Contractor and HNS with
reasonable assistance in procuring and maintaining such Permits.
Revision 3.1
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Exhibit A-1
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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4.4.6 Other Services
Contractor shall provide any services not specifically described in this
Statement of Work, but that are required or appropriate for the proper
performance and provision of such Deliverable Services and Deliverable Items.
4.5 Deliverable Data
The documents to be delivered shall be divided into four separate categories as
defined in Section 8:
a. Program and Management Documentation, as detailed in Table 8-1 of this
SOW
b. System Design Documentation, as detailed in Table 8-2 of this SOW
c. System Development and Fabrication Documentation, as detailed in Table
8-3 of this SOW
d. System Operations and Training Documentation, as detailed in Table 8-4
of this SOW. Contractor shall deliver a plan containing comprehensive
training for operation and maintenance of the SBAS System. The
training plan shall include training methods, training content outline
and schedules.
5.0 Program Milestone Schedule
Contractor shall deliver all items of Table 4-1 in accordance with the Program
Milestone Schedule of Section 2.0 of Exhibit E-1, SBAS Payment Plan.
6.0 Program Operations and Management
6.1 General Program Office Tasks
Contractor shall perform Program Management tasks including but not limited to
the following:
1. Manage the technical development and delivery of the System in accordance
with the Contract.
2. Manage and coordinate the technical development activities of major third
party suppliers and subcontractors, and their subcontractors, who provide
services and equipment to Contractor as subcontractors, to assure full
compliance with system functional and performance specifications.
3. Report on the progress of key activities such as development status,
schedule and risk mitigation. Such reporting shall include regular reports
in accordance with the Program Management Plan and special reports that
address critical issues and the early identification of potential problems
as they occur.
4. Define, develop and present for Purchaser concurrence, corrective action
plans for major issues that may threaten business objectives, schedule or
technical performance of the System. These corrective action plans shall be
implemented in a timely manner.
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Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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5. Schedule, conduct and manage system design and Program progress reviews on
a regular basis and as required to address critical issues.
6. Produce, evaluate, approve, and submit to Purchaser, deliverable data items
for the System in timely manner in accordance with the CDRL.
6.2 Program Management Plan
Contractor shall establish a Program Management Office and appoint a Program
Manager who shall be the central point of interface with Purchaser. The Program
Manager shall be responsible for the performance of this Agreement including
planning, coordinating, and directing key Program activities, including those
provided for by direct third party sub-contractors.
Contractor shall prepare, implement, and maintain a Program Management Plan
defining the management approach for developing, designing, producing,
validating, deploying, and maintaining the System. Schedule and critical paths
(risk and risk mitigation) are key components of this Plan.
Contractor shall identify the major subcontracts anticipated for this
procurement. The Contract Management Plan shall be included in the Program
Management Plan.
6.3 Program Master Schedule
Contractor shall create, maintain and track a Program Master Schedule which
identifies the key hardware and software design and development activities, plus
the key Program milestones and Deliverable Items as defined in Tables 4-1 and
5-1 of this SOW.
6.4 Program Risk Mitigation Plan
Contractor shall prepare and submit to Purchaser a Program Risk Mitigation Plan
that will show in sufficient detail the processes that will be followed by the
Program Office and all teams on Contractor's side in order to minimize and
eliminate any and all risks in relation to the design, fabrication, IT&V,
operational integrity and performance of the System.
6.5 Configuration and Data Management Plan
Contractor shall establish, implement and maintain Configuration and Data
Management plans for the System defining the approach for identifying and
documenting the functional and physical characteristics of the System,
controlling changes to those characteristics, and recording and reporting change
processing and implementation status. This plan also defines uniform, effective
management methods for all Program information.
Revision 3.1
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Exhibit A-1
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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6.6 Product Assurance Plan
Contractor shall conduct a Product Assurance Program in accordance with the
Product Assurance Plan (CDRL Table 8-1) delivered at SRR to ensure that quality
is built into all phases of the system design, fabrication, integration, test
and verification processes.
6.7 Change Control Process
Contractor shall establish appropriate internal change control boards (CCBs) to
review and approve all proposals that result in any change in system
specifications as work progresses. All such proposals shall be submitted to
Purchaser for final approval, before implementation.
6.8 Program Progress Reviews
Contractor Program Office shall hold internal regular, monthly Program Progress
Review meetings to report Program status on technical development, progress,
performance, schedule and risks, including the Major Subcontracts, from all
participating teams. Assessment of risk elements, issues and plans for
corrective action shall be emphasized. A summary of all such reviews shall be
presented to Purchaser during quarterly Program Progress Reviews in terms of
accomplishments, upcoming activities, issues and concerns, and Program Master
Schedule status. Action items resulting from the reviews shall be tracked by
Contractor for resolution.
6.9 System Design Reviews
Contractor shall conduct a Kick Off Review (KOR), a System Requirements Review
(SRR), a Preliminary Design Review (PDR), and a Critical Design Review (CDR) for
the System and each of its GBBF (including CES) and FES entities.
A comprehensive design review data package shall be submitted to Purchaser at
least two weeks prior to each design review. The system level packages shall
include functional block diagrams, operational threads, and operations
interfaces in addition to information and analysis normally provided as a part
of design review packages.
6.9.1 Kick-Off Review (KOR)
The KOR shall be conducted to evaluate Contractor's overall preparation for the
Program and present the Program Management Plan and other programmatic plans.
KOR material will be delivered to Purchaser at the KOR and shall be reviewed
interactively with Purchaser and HNS representatives. The meeting shall be held
at the HNS premises in Maryland. The KOR shall be conducted over a period of one
(1) day. Action items shall be logged and managed by the program manager.
6.9.2 System Requirements Review (SRR)
The SRR shall be conducted to evaluate Contractor's overall understanding of the
SRS requirements and present their design approach in terms of satisfying
performance requirements and their flow-down and allocation from the System to
entity levels. The SRR shall not include the results of the adaptive nulling
study. The SRR shall also provide a preliminary review of the external and
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Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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internal functional interfaces. The meeting shall be held at the HNS premises in
Maryland. The SRR shall be conducted over a period of two (2) days. Action items
shall be logged and managed by the program manager.
6.9.3 Preliminary Design Review (PDR)
The PDR shall present, which may be at a preliminary level, the system design
approaches to be investigated and the system simulation approach.
The PDR shall build on the SRR and show the overall design approach, design
configuration and concepts, predicted/measured results of the designs, more
detailed flow-down and allocation of requirements at the subsystem and unit
levels, including the identification of risks and risk mitigation plans. It
shall also include the results of the adaptive nulling study. These results will
be used to mutually define the requirements for adaptive nulling, two (2) weeks
after PDR. A review of the System development, fabrication, deployment,
integration, test and verification plans shall also be presented. All CDRLs
scheduled for completion by PDR shall also have been delivered by this time. The
meeting shall be held at the HNS premises in Maryland. The PDR shall be
conducted over a period of three (3) days. Action items shall be logged and
managed by the program manager.
6.9.4 Critical Design Review (CDR)
The CDR shall be performed at the end of the system design phase and present its
results, including the system architecture definition and the system simulation
results.
The CDR shall build on the PDR works and demonstrate how the detailed design of
each unit/subsystem/entity meets all performance requirements, leading to
compliance with the SRS. All performance predictions shall be based upon
engineering analysis and measured data. The System or subsystem hardware and
software shall be reviewed in detail. Plans for producing, testing, integrating,
and deploying the System or subsystems shall be reviewed. The CDR shall provide
a thorough review of new designs and any modified existing designs used by
Contractor in prior works. An update of the System development, fabrication,
deployment, integration, test and verification plans shall also be presented.
All CDRLs scheduled for completion by CDR shall also have been delivered by this
time. The meeting shall be held at the HNS premises in Maryland. The CDR shall
be conducted over a period of three (3) days. Action items shall be logged and
managed by the program manager.
6.9.5 Integrated System Architecture Reviews
Contractor shall support periodic Integrated System Architectural Reviews to
ensure compatibility of the SBAS design with the on going parallel TerreStar
Satellite Program. These reviews, to be held at mutually agreed upon locations,
shall include representatives of Contractor, HNS, and Purchaser and will focus
on developing the necessary interface controls to ensure the compatibility of
the SBAS with the Satellite for on-ground and in-orbit testing and for final
on-orbit operations. The number of reviews to be held at Purchaser facilities
shall be 5 or less.
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Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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6.10 Design Review Reports
At the completion of daily reviews of SRR, PDR, and CDR, action item data sheets
submitted by the reviewers shall be collected and summarized and reviewed by
Contractor and Purchaser representatives for disposition. The data sheets, along
with closure reports when completed, shall be submitted to Purchaser in a design
review report. Purchaser's approval or concurrence of the report shall
constitute successful completion of each design review. The review action items
will be tracked to closure through the on-going Program Management process.
6.11 System Design Documentation
Contractor shall maintain all "as-built" System hardware and software
documentation. This documentation shall include test data records, released
drawings, schematics, checklists, etc., necessary to support the System. This
documentation shall be prepared, maintained in current status as applicable.
This design documentation shall be made available within a reasonable time to
Purchaser upon request. The system documentation shall be stored for at least
the respective lifetime of each Deliverable Item.
6.12 System Development and Fabrication Plan
Contractor shall develop and submit to Purchaser a System Development and
Fabrication Plan that will show in sufficient detail the technological
approaches, schedule, and major activities related to the development and
fabrication of the software and hardware components of the System entities. The
Plan shall show the key participating organizations and teams from within
Contractor, and other third party sub-contractors, with their role and
responsibilities clearly identified. The Plan shall also identify and summarize
prior works performed by Contractor and their sub-contractors which may be of a
similar nature from a technological complexity and composition point of view. A
risk assessment and mitigation plan associated with the chosen technological
approach shall also be included.
6.13 System Deployment & Installation Plan
Contractor shall develop and submit to Purchaser a System Deployment and
Installation Plan that will show in sufficient detail the schedule and major
activities related to the deployment and installation of the System entities at
the Operational Sites. The Plan shall show the key participating teams from
within Contractor, and other third party sub-contractors, with their role and
responsibilities clearly identified.
6.14 Consent-to-Ship Review
Upon completion of the factory test programs for each SBAS entity, as defined in
the respective Acceptance Verification Plan, Contractor shall hold a
Consent-to-Ship meeting prior to shipment of the equipment to the Operational
Site. The purpose of the meeting is to review the System/entity status including
configuration, test liens, CDRL delivery status, anomaly review, corrective
actions, and product assurance status.
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Exhibit A-1
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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6.15 System Deployment Reviews
Contractor shall conduct reviews of the System deployment progress starting with
the review of the preliminary deployment plan at CDR. The baseline deployment
plan shall be reviewed six months before start of deployment, and then followed
by regularly scheduled reviews.
The purpose of the reviews is to help ensure that the deployment of the System
is on schedule and that the deployed System will satisfy the Contract, and meet
the business operational objectives.
6.16 Operations and Maintenance Plan
Contractor shall provide an Operations and Maintenance Plan for each System
entity. The Operations and Maintenance Plan shall include but not be limited to
hardware, software, and facilities, and shall catalog the operating and
maintenance procedures, and briefly describe operations personnel and facilities
requirements for the System.
6.17 Access to Information
Purchaser shall have reasonable access to all information associated with the
Program. Implementation of such access may be through meetings, design review
material, technical documents or other appropriate channels.
6.18 Coordination with TerreStar Hybrid Network
As part of the Services, Contractor agrees to direct HNS (i) to coordinate and
cooperate, in good faith, with other members of the TerreStar Hybrid Network,
including agents, consultants, subcontractors, and third party suppliers to
accomplish the portion of the HNS Subcontracted Work; and (ii) to support the
development and implementation of a fully functional TerreStar Hybrid Network,
subject in all cases to applicable legal and contractual restrictions. If at any
time Contractor becomes aware from HNS of any material information concerning
the TerreStar Hybrid Network that differs from that provided to HNS, Contractor
shall promptly notify Purchaser in writing of such differences.
7.0 System Integration, Test and Verification
Contractor shall verify that each SBAS entity satisfies its requirements through
a series of tests and/or verification methods at the subsystem, end-to-end, and
the SAN level. System requirements verification shall be performed as defined
below.
7.1 Verification Plans
Verification Plans will include the overall verification approach, the overall
test philosophy, the test flow showing each major test phase, and for each test
phase a top-level description and set of test objectives. Contractor shall
develop a Verification Plan (VP) for the System and each of its GBBF, CMS, CES
and FES entities. Contractor shall ensure consistency between the SBAS
Operational Component and entity Verification Plans.
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Exhibit A-1
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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7.2 Compliance Matrices
For the SBAS Operational Component and each entity, Contractor shall use the
appropriate Verification Plan to generate a Compliance Matrix, cross referenced
to the appropriate requirements document.
Each Compliance Matrix shall demonstrate how each requirement will be satisfied,
e.g., by inspection, analysis, demonstration, test, or a combination of these as
well as specifying at what level (e.g., unit, entity, SBAS Operational
Component) the verification will occur.
7.3 Acceptance Verification Plans (AVP)
Contractor shall provide Acceptance Verification Plans (AVPs) at the SBAS
Operational Component and entity levels. The SBAS Operational Component AVP will
be used for System Acceptance. The entity AVP will be used for sell-off of the
entities. An Operational Site AVP shall also be provided.
The AVP shall include the test objectives, test description, evaluation
criteria, the trace of requirements for each test, and special test requirements
at each level required to sell-off the entity or System Acceptance.
The GBBF subsystem Acceptance Verification Plan shall be prepared as described
in Exhibit D-1, SBAS Program Test Plan.
7.4 Factory Acceptance Tests (part of Preliminary Acceptance Testing)
Prior to shipment to the Operational Site, Contractor shall perform a Factory
Acceptance Test (FAT) in two parts, one for the FES and another for the
GBBF/CES/CMS, to demonstrate compliance with SBAS and entity specifications. The
Factory Acceptance Test shall be a formal test demonstrating SBAS and entity
functionality and shall be successfully completed prior to the Consent-to-Ship
Reviews.
7.5 Site Acceptance Tests (part of Preliminary Acceptance Testing)
Contractor shall perform a formal Site Acceptance Test (SAT), for each SBAS
entity at the Operational Sites to demonstrate, to the extent possible, all
operational capabilities prior to Integration with the Satellite and other SAN
entities.
7.6 System Integration
After the respective Site Tests, Contractor shall integrate the SBAS entities
with the other SAN entities of MTS, SCF/SOC and SAN-NOMC. This integration will
occur after Site Acceptance Tests. After integration of all of these components,
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Contractor shall perform sufficient integration tests to verify the SBAS is
ready for the formal Pre-Launch System Acceptance Tests.
7.7 Pre-Launch System Acceptance Test (part of Preliminary Acceptance Testing)
The objectives of the Pre-Launch System Acceptance Test are as follows:
1. Demonstrate that the SBAS and its entities as installed are
functional and ready for post-launch acceptance testing.
2. Ensure that the SBAS is compatible and interoperable with other
ground station and SAN entities.
Preliminary Acceptance (PA) will occur upon completion of FAT, SAT and
Pre-Launch System Acceptance Test in accordance with Article 10.2.1 and 10.2.2
of the Contract.
7.8 SBAS Operational Component Final Acceptance/ Hand-Over
Upon Preliminary Acceptance of the SBAS Operational Component and Acceptance of
the Satellite, Contractor shall conduct SBAS Operational Component Final
Acceptance testing in accordance with the SBAS Operational Component Final
Acceptance Test Plan/Procedure (developed in accordance with Section 7.9, and
provided to Purchaser as a CDRL pursuant to Table 8-3 below) to demonstrate SBAS
Operational Component's performance within the SBN system. Calibration of the
forward and return links using the CES shall be performed and the full
functionality of the FES/GBBF shall be demonstrated as part of the SBAS
Operational Component Final Acceptance testing. Upon successful completion of
SBAS Operational Component Final Acceptance testing, Contractor shall prepare
and submit to Purchaser an SBAS Operational Component Final Acceptance Test
Report summarizing the results of the SBAS Operational Component Final
Acceptance testing and containing a Certificate of SBAS Operational Component
Final Acceptance Test Completion. Within three (3) business days of submission
of the SBAS Operational Component Final Acceptance Test Report, Contractor shall
conduct an SBAS Operational Component Final Acceptance Review with Purchaser to
review the results of the SBAS Operational Component Final Acceptance testing,
as reflected in the SBAS Operational Component Final Acceptance Test Report.
Thereafter, Final Acceptance (FA) of the SBAS Operational Component shall occur
as provided in Article 10.2.5 of the Contract. Upon Final Acceptance of the SBAS
Operational Component, Contractor shall hand-over the SBAS Operational Component
to Purchaser.
7.9 Test Plans/Procedures
Contractor shall write, release and utilize test plans and procedures for the
SBAS Operational Component Preliminary Acceptance testing and for the SBAS
Operational Component Final Acceptance testing. Each test plan/procedure will
identify (as appropriate) the test objective, test description, evaluation
criteria, and, if applicable, configuration for each test. Each Acceptance test
procedure will include step-by-step detailed, specific actions to be taken and
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expected results. The Acceptance test plans/procedures shall be delivered to
Purchaser per the CDRL; any other procedure for any test will be provided to
Purchaser upon request.
7.10 Test Equipment and Personnel
Contractor shall provide the necessary test equipment (including software) and
personnel to conduct all tests for the SBAS and its entities. Test equipment
used by Contractor for the performance of this SOW shall not be a Deliverable
Item, except to the extent such equipment constitutes the Satellite Simulator,
GBBF Emulator, S-BSS Emulator, or test tools described in Section 4.2.4.
7.11 GBBF Emulator for Satellite Factory Test
Contractor shall provide technical support, per Deliverable Item 4.2, Table 4-1
("Satellite Factory Test Support") and Section 4.4.2 ("SBAS Test Deliverables")
of this Exhibit for operation of the GBBF Emulator during the Satellite Factory
Test.
7.12 Ancillary Equipment for ITV Activities
In carrying out the SBAS integration, test and verification (ITV) activities,
Contractor shall provide for all the necessary ancillary equipment in terms of
emulators or similar capabilities, except for the satellite-payload emulator,
that may be required to perform the SBAS tests when other Ground Station and SAN
entities are involved.
7.13 Site Facilities Requirements Schedule
Contractor shall, in a timely manner, submit to Purchaser, for approval and
authorization, a detailed schedule of works and material to be performed and
provided for each Ground Station and every CES Operational Site by Contractor in
accordance with Section 4.4.4. The schedule shall be consistent with the Program
Milestone Schedule and the requirements of Section 9.2.
7.14 Site Installation As-Built Documentation
Contractor shall provide a complete set of as-built documentation for the SBAS
and its entities as they are installed at each Operational Site, including the
CES sites if any.
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8. Contract Data Requirement List (CDRL)
Contractor shall provide the CDRL items listed in, and per other conditions of,
Tables 8-1 through Table 8-4. All material shall be delivered in electronic form
and media, where practical, using the latest and widely used application
programs and formats.
The word system as used in the CDRL tables applies both to the entire SBAS and
to individual entities making up the SBAS (GBBF, FES, CES, CMS and TTF). As
such, each individual CDRL item shall cover all SBAS entities as applicable.
Same applies to any major subsystem or service provided to Contractor by third
party sub-contractors.
Table 8-1: Program Operations and Management CDRLs
==============================================================================================
REF # DESCRIPTION DUE DATE FREQ. REMARKS
- ----------------------------------------------------------------------------------------------
Sec. 6.2 Program Management Plan KOR Updates
(Includes Sub-Contract Program Plans) @ SRR
and as
required
- ----------------------------------------------------------------------------------------------
Sec. 6.3 Program Master Schedule KOR Updates
monthly
- ----------------------------------------------------------------------------------------------
Sec. 6.4 Program Risk Mitigation Plan KOR Updates
@ SRR,
PDR,and
CDR
- ----------------------------------------------------------------------------------------------
Sec. 6.5 Configuration and Data Management Plan SRR Updates
as
required
- ----------------------------------------------------------------------------------------------
Sec. 6.6 Product Assurance Plan SRR Updates
as
required
- ----------------------------------------------------------------------------------------------
Sec. 6.7 Change Control Board Reports As required For
Approval
- ----------------------------------------------------------------------------------------------
Sec. 6.8 Program Progress Review Reports SBN EDC + Monthly
1 Month and
Quarterly
==============================================================================================
Table 8-2: System Design Documentation CDRLs
==============================================================================================
REF # DESCRIPTION DUE DATE FREQ. REMARKS
- ----------------------------------------------------------------------------------------------
Sec. 6.9 System Design Documentation Structure 2 wks before
review
- ----------------------------------------------------------------------------------------------
Sec. 6.9 System Design Description 2 wks before
review
- ----------------------------------------------------------------------------------------------
Sec. 6.9.1 KOR Documents 2 wks before
review
- ----------------------------------------------------------------------------------------------
Sec. 6.9.2 SRR Review Documents 2 wks before
review
==============================================================================================
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===============================================================================================
Sec. 6.9.3 PDR Review Documents 2 wks before
review
- -----------------------------------------------------------------------------------------------
Sec. 6.9.4 CDR Review Documents 2 wks before
review
- -----------------------------------------------------------------------------------------------
System ICDs PDR CDR For Approval
- -----------------------------------------------------------------------------------------------
Summary of System Integration, Test & reliminary Final 1 For Approval
Verification Reports @ Test wk after
Completion test
- -----------------------------------------------------------------------------------------------
Sec 7.2 SRS Compliance Matrix SRR Updates
@ PDR
and CDR
===============================================================================================
Table 8-3: System Development, Fabrication and Deployment Documentation CDRLs
====================================================================================================
REF # DESCRIPTION DUE DATE FREQ. REMARKS
- ----------------------------------------------------------------------------------------------------
Sec 6.11 System Development & Fabrication Plan KOR Updates @
(Including Major Subcontractors) SRR, PDR,
and CDR
- ----------------------------------------------------------------------------------------------------
6.12 System Deployment & Installation Plan SRR Updates @
PDR and
CDR
- ----------------------------------------------------------------------------------------------------
Sec 7.3 System/Entity Verification Plans SRR Updates @
PDR and
CDR
- ----------------------------------------------------------------------------------------------------
Sec 7.3 Acceptance Verification Plans SRR Updates @ For Approval
PDR an
CDR
- ----------------------------------------------------------------------------------------------------
Sec 7.4 Factory Acceptance Test Plan SRR Updates @ For Approval
PDR and
CDR
- ----------------------------------------------------------------------------------------------------
Factory Acceptance Test Procedures 2 wks before
tests
- ----------------------------------------------------------------------------------------------------
Factory Acceptance Test Report Preliminary at Final 1 wk For Approval
test after test
completion
- ----------------------------------------------------------------------------------------------------
GBBF Emulator/Satellite Factory Test Plan PDR Updates @ For Approval
CDR
- ----------------------------------------------------------------------------------------------------
GBBF Emulator/Satellite Factory Test CDR Updates @
at
Procedures completion
of the
SBAS
Factory AT
====================================================================================================
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======================================================================================= ============
GBBF Emulator/Satellite Factory Test Preliminary at Final 1 wk
Report test after test
completion
- ---------------------------------------------------------------------------------------------------
Sec 7.5 Site Acceptance Test Plan SRR Updates @ For Approval
PDR and
CDR
- ---------------------------------------------------------------------------------------------------
Site Acceptance Test Procedures 2 wks before
tests
- ---------------------------------------------------------------------------------------------------
Sec 7.13 Site Facilities Requirements Schedule SRR Updates @
PDR and
CDR
- ---------------------------------------------------------------------------------------------------
Sec 7.14 Site Installation As-Built Documentation 1 wk after site
installation
- ---------------------------------------------------------------------------------------------------
Sec 7.5 Site Test Report Preliminary at Final 1 wk For Approval
test after test
completion
- ---------------------------------------------------------------------------------------------------
Sec 7.7 System Acceptance Test Plan SRR Updates @ For Approval
PDR and
CDR
- ---------------------------------------------------------------------------------------------------
System Acceptance Test Procedures 2 wks before
tests
- ---------------------------------------------------------------------------------------------------
System Acceptance Test Report Preliminary at Final 1 wk For Approval
test after test
completion
- ---------------------------------------------------------------------------------------------------
Sec 7.8 SBAS Final Acceptance Test Plan SRR Updates @ For Approval
PDR and
CDR
- ---------------------------------------------------------------------------------------------------
SBAS Final Acceptance Test Procedures 2 wks before
tests
- ---------------------------------------------------------------------------------------------------
SBAS Final Acceptance Test Report Preliminary at Final 1 wk For Approval
test after test
completion
- ---------------------------------------------------------------------------------------------------
A complete listing of all Deliverable Submitted as Updates @ For Approval
Hardware part of SRR, PDR,
proposal CDR and
Final
Acceptance
- ---------------------------------------------------------------------------------------------------
Sec 4.7 A complete listing of all Deliverable SRR Updates @ For Approval
Software Programs and Licenses PDR,
CDR, and
Final
Acceptance
- ---------------------------------------------------------------------------------------------------
Sec 4.3 A complete listing of all Deliverable Test Submitted as Updates @ For Approval
Tools and Spare Parts part of PDR,
Proposal CDR, and
Final
Acceptance
===================================================================================================
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=================================================================================================
Warranty Certificates and Service Agreements At Preliminary For Approval
for all Deliverable Items of hardware and Acceptance
software.
- -------------------------------------------------------------------------------------------------
FES Performance Data Package for FCC 1 wk after Site
Application Acceptance
Testing
- -------------------------------------------------------------------------------------------------
CES Performance Data Package for FCC 1 wk after Site
Application Acceptance
Testing of the
1st CES
===================================================================================================
Table 8-4: System Operations & Training Material CDRLs
===================================================================================================
REF # DESCRIPTION DUE DATE FREQ. REMARKS
- ---------------------------------------------------------------------------------------------------
Sec 4.5 System Operations and Maintenance Plan PDR Updates @ For Approval
CDR and
Final
Acceptance
- ---------------------------------------------------------------------------------------------------
Sec 4.5 System Operations Manuals CDR Updates @ For Approval
Final
Acceptance
- ---------------------------------------------------------------------------------------------------
Sec 4.5 System Operations Procedures CDR Updates @
Final
Acceptance
- ---------------------------------------------------------------------------------------------------
Sec 4.5 System Operations Constraints CDR Updates @
Final
Acceptance
- ---------------------------------------------------------------------------------------------------
Sec 4.5 System Maintenance Procedures CDR Updates @
Final
Acceptance
- ----------------------------------------------------------------------------- ---------------------
Sec 4.6 System Operations Training Plan PDR Updates For Approval
@ CDR
- ---------------------------------------------------------------------------------------------------
Sec 4.6 System Operations Training Material 2 wks before
training
===================================================================================================
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9.0 Purchaser-Furnished Dependencies and Deliverables
9.1 CFE Description
Notwithstanding other customer furnished items identified herein and in the
Contract, the following list describes equipment and/or work to be provided by
Purchaser necessary for Contractor to accomplish its SBAS tasks. These items
shall be made available during the required period and shall be included in the
definition of Purchaser-Furnished Items as set forth in Article 6 of the
Contract.
Purchaser shall provide the following:
1. TT&C baseband equipment to test the FES/TT&C Interface by SBN EDC + 18
months.
2. Routers/firewalls at the NOMC, Hybrid Network CRMS, SOC and TT&C baseband
equipment to test the S-BSS external interface by SBN EDC + 18 months.
9.2 CFE Facilities Requirements
At CDR, HNS shall provide to Contractor, for Contractor's review and approval, a
communication plan and a schedule (the "CES Facilities Schedule") for the
performance of its obligations associated with the leases and agreements for the
TTF defined in Section 4.1.2.2 hereof (the "TTF Leases/Agreements") and all
necessary arrangements/agreements for the CES sites defined in Section 4.4.4
hereof (the "CES Agreements"). The CES Facilities Schedule shall specify the
date upon which the CES facilities are to be made available to HNS and shall
take into account the following:
a. The CES Agreements shall be executed at least ninety (90) days
before the date upon which the CES are to be made available to HNS, or longer
period as necessary for the site to perform any required civil works, comply
with zoning and permit requirements, and to order and install the TTF items at
such site.
b. The TTF Leases/Agreements shall be executed at least forty-five (45)
days before the date upon which the CES's are to be made available to HNS, or
longer period as necessary to comply with zoning and permit requirements and for
the TTF provider to install and test the TTF items.
c. TerreStar shall be given at least sixty (60) days to execute the TTF
Leases/Agreements and CES Agreement following approval of such agreements by
Purchaser's Director of Contracts.
d. Purchaser shall be given at least sixty (60) days to review and
comment on the initially proposed TTF Leases/Agreements and CES Agreements.
e. HNS shall be given at least ninety (90) additional days to obtain
feed back from Purchaser and to negotiate favorable resolution of the terms of
the TTF Leases/Agreements and CES Agreements.
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Subject to HNS performing its obligations in good faith and within the time
frames specified in the agreed upon CES Facilities Schedule, Contractor or
Purchaser shall make the CES facilities available to HNS on the availability
date specified in the CES Facilities Schedule.
10.0 Compliance with Laws
Contractor shall, at its expense, perform its respective obligations hereunder
in accordance with all applicable laws, regulations and policies and the
conditions of all applicable governmental approvals, permits or licenses.
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restriction on the title page.
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10.0 ACRONYMS LIST
- --------------------------------------------------------------------------------
ACRONYM LIST
- --------------------------------------------------------------------------------
ATN Ancillary Terrestrial Network
- --------------------------------------------------------------------------------
AVP Acceptance Verification Plans
- --------------------------------------------------------------------------------
BITE Built-In-Test-Equipment
- --------------------------------------------------------------------------------
CCBs Change Control Boards
- --------------------------------------------------------------------------------
CCI Co-Channel Interference
- --------------------------------------------------------------------------------
CDR Critical Design Review
- --------------------------------------------------------------------------------
CDRL Contractual Documents Requirement List
- --------------------------------------------------------------------------------
CEO Chief Executive Officer
- --------------------------------------------------------------------------------
CES Calibration Earth Stations
- --------------------------------------------------------------------------------
CMS Control and Management Subsystem
- --------------------------------------------------------------------------------
Contractor Space Systems/Loral
- --------------------------------------------------------------------------------
CPE Customer-Premises Equipment
- --------------------------------------------------------------------------------
CRMS Communications Resource Management System
- --------------------------------------------------------------------------------
SBN EDC Space Based Network Effective Date of Contract
- --------------------------------------------------------------------------------
FA Final Acceptance
- --------------------------------------------------------------------------------
FAT Factory Acceptance Test
- --------------------------------------------------------------------------------
FCC Federal Communications Commission
- --------------------------------------------------------------------------------
FES Feeder-Link Earth Station
- --------------------------------------------------------------------------------
FAT Factory Acceptance Test
- --------------------------------------------------------------------------------
GBBF Ground Based Beam Former
- --------------------------------------------------------------------------------
HNS Hughes Network Systems, LLC
- --------------------------------------------------------------------------------
IOT Satellite In-Orbit Test
- --------------------------------------------------------------------------------
IP Internet Protocol
- --------------------------------------------------------------------------------
ITAR International Traffic and Arms Regulations
- --------------------------------------------------------------------------------
ITV Integration, Test, and Verification
- --------------------------------------------------------------------------------
KOR Kick Off Review
- --------------------------------------------------------------------------------
LIBOR London Inter-Bank Offer Rate
- --------------------------------------------------------------------------------
MT Mobile Terminals
- --------------------------------------------------------------------------------
NOMC Network Operations and Management Center
- --------------------------------------------------------------------------------
OBO Operating Output Backoff
- --------------------------------------------------------------------------------
PA Preliminary Acceptance
- --------------------------------------------------------------------------------
PDR Complete System Preliminary Design Review
- --------------------------------------------------------------------------------
PMO Program Management Office
- --------------------------------------------------------------------------------
PSA Primary Service Area
- --------------------------------------------------------------------------------
SAN Satellite Access Network
- --------------------------------------------------------------------------------
SAT Site Acceptance Test
- --------------------------------------------------------------------------------
SBAS Satellite Beam Access Subsystem
- --------------------------------------------------------------------------------
SBN Satellite Based Network
- --------------------------------------------------------------------------------
S-BSS Satellite-Adapted Base Station Subsystem
- --------------------------------------------------------------------------------
SCA Secondary Coverage Area
- --------------------------------------------------------------------------------
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restriction on the title page.
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- --------------------------------------------------------------------------------
SGS ground segment procurement
- --------------------------------------------------------------------------------
SLA Service Level Agreement
- --------------------------------------------------------------------------------
SOC Satellite Operation Center
- --------------------------------------------------------------------------------
SOW Statement of Work
- --------------------------------------------------------------------------------
SRR System Requirements Review
- --------------------------------------------------------------------------------
SRS System Requirements Specifications
- --------------------------------------------------------------------------------
SS Satellite Simulator
- --------------------------------------------------------------------------------
TT&C Tracking, Telemetry and Commands
- --------------------------------------------------------------------------------
TTF Terrestrial Transmission Facilities
- --------------------------------------------------------------------------------
UPC Uplink Power Control
- --------------------------------------------------------------------------------
VP Verification Plan
- --------------------------------------------------------------------------------
XPI Cross Polarization Interference
- --------------------------------------------------------------------------------
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Exhibit A-1
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Exhibit A-2
Statement of Work for
TerreStar S-Band Space Based Network
and Interference Analysis Support
Document No.: SS/L-E338830 - Revision C December 1, 2006
Space Systems/Loral
3825 Fabian Way
Palo Alto, California 94303 _________________________________
TerreStar Networks, Inc.
One Discovery Place
12010 Sunset Hills Road
6th Floor
Reston, Virginia 20190 _________________________________
- --------------------------------------------------------------------------------
This document contains data and information proprietary to Space Systems/Loral,
Inc. and TerreStar Networks Inc. This data is being furnished pursuant to the
provisions of the Contract between TerreStar Networks Inc. and Space
Systems/Loral, Inc. for the TerreStar Satellite Program. Space Systems/Loral,
Inc. and TerreStar Networks Inc. shall have the right to duplicate, use or
disclose the data and information to the extent specified in the Purchase
Contract.
- --------------------------------------------------------------------------------
The data/information contained herein has been reviewed and approved for release
by Space Systems/Loral Export Administration on the basis that this document
contains no export-controlled information.
- --------------------------------------------------------------------------------
Revision C
12/01/06
Exhibit A-2
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SS/L-E338830 - Rev. C
Exhibit A-2
12/01/06
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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CONTENTS
Section Page
ABBREVIATIONS AND ACRONYMS.......................................................................................VI
1 -- SCOPE........................................................................................................1
1.1 SUMMARY STATEMENT OF WORK.......................................................................1
1.2 PROGRAM SCHEDULE................................................................................2
1.3 APPLICABLE DOCUMENTS............................................................................3
2 -- DELIVERABLES.................................................................................................3
2.1 SBN DELIVERABLE SERVICES.......................................................................3
2.1.1 SBN Requirements and Design...........................................................3
2.1.2 SBN Development.......................................................................6
2.1.3 SBN Verification......................................................................8
2.1.4 Training of Purchaser Personnel (CDRLs SI-14a and SI-14b).............................9
2.1.5 Initial SBN Operations...............................................................10
2.1.6 SBN Warranty 10
2.1.7 Long-Term Support....................................................................10
2.2 DELIVERABLE SYSTEM LEVEL INTERFERENCE ANALYSES AND SUPPORT....................................12
2.2.1 Interference Analyses................................................................12
2.2.2 Technical Regulatory Analyses and Negotiation Support................................14
2.2.3 Sharing Opportunities................................................................14
2.3 DELIVERABLE DATA ITEMS........................................................................15
2.3.1 General..............................................................................15
2.3.2 Electronic Access....................................................................15
2.3.3 Program Management Plan (CDRL SI-01).................................................16
2.3.4 Program Master Schedule (CDRL SI-02).................................................17
2.3.5 Monthly Progress Report (CDRL SI-09).................................................17
2.3.6 SBN Requirement Review Data (CDRL SI-03).............................................18
2.3.7 Preliminary Design Review Data (CDRL SI-04)..........................................18
2.3.8 Critical Design Review Data (CDRL SI-05).............................................18
2.3.9 SBN Performance Specification (CDRL SI-21)...........................................19
2.3.10 SBN Operations Concept Report (CDRL SI-22)...........................................19
2.3.11 SBN Analysis Reports (CDRL SI-15)....................................................19
2.3.12 Program Test Plans, Procedures and Reports...........................................20
2.3.13 Data Available On-Site...............................................................21
2.3.14 SBN Validation Operations Plan (CDRL SI-10)..........................................21
2.3.15 SBN Operations Handbook (CDRL SI-11).................................................21
2.3.16 Interference Analysis Reports (CDRL SI-18)...........................................21
SS/L-E338830 - Rev. C
Exhibit A-2
iii
12/01/06
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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2.4 PROPOSAL FOR SECOND SBN........................................................................22
2.5 TIME AND MATERIAL SUPPORT......................................................................23
3 -- PROGRAM REQUIREMENTS........................................................................................24
3.1 PROGRAM MANAGEMENT.............................................................................24
3.1.1 Program Management Office............................................................24
3.1.2 Progress Reporting and Meetings......................................................24
3.2 RESERVED.......................................................................................25
3.3 PROGRAM AND TECHNICAL REVIEWS..................................................................25
3.3.1 Quarterly Program Status Meetings....................................................25
3.3.2 SBN Requirements Review (SRR)........................................................25
3.3.3 Preliminary Design Review............................................................26
3.3.4 Critical Design Review...............................................................26
3.3.5 Test Readiness Reviews...............................................................26
3.3.6 Post-Test Data Reviews...............................................................27
3.3.7 SBN Acceptance/Handover Review (CDRL's SI-16 and SI-17)..............................27
3.4 PURCHASER FURNISHED ITEMS......................................................................27
3.4.1 Equipment, Facilities and Services...................................................27
3.4.2 Data and Information.................................................................28
3.5 COMPLIANCE WITH US EXPORT CONTROL LAWS.........................................................29
ANNEX 1 -- CONTRACT DATA REQUIREMENTS LIST (CDRL)................................................................30
TABLES
Table Page
Table 2-1. Classroom Training Courses............................................................................9
FIGURES
Figure Page
Table 2-1. Classroom Training Courses............................................................................9
SS/L-E338830 - Rev. C
Exhibit A-2
iv
12/01/06
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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SS/L-E338830 - Rev. C
Exhibit A-2
v
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restriction on the title page.
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ABBREVIATIONS AND ACRONYMS
Abbreviations and Acronyms:
AEIRP Aggregate Effective Isotropic Radiated Power
ATC Ancillary Terrestrial Component
C/I Carrier to Interference ratio (Figure of merit)
C/N Carrier to Noise ratio (Figure of merit)
C/(No+Io) Carrier to Noise and Interference density Ratio (Figure of merit)
CDR Critical Design Review
CDRL Contract Data Requirements List
CMS Control Management System
CONUS Continental United States
CRMS Central Resource Management System
EST Emergency Support Team
FAX Facsimile
FCC Federal Communications Commission
FES Feeder Link Earth Station
GBBF Ground-Based Beam Formers
G/T Gain to Noise Temperature ratio (Figure of merit)
IAW In Accordance With
ICD Interface Control Document or Drawing
IF Intermediate Frequency
IPT Integrated Product Team
ITU International Telecommunications Union
MSS Mobile Satellite System
NCR Non-Conformance Report
NOMC Network Operations & Maintenance Center
PDR Program Development Review
PMO Program Management Office
PMP Program Management Plan
PRR Program Readiness Review
PTDR Post-Test Data Review
SBN EDC Space Based Network Effective Date of Contract
RF Radio Frequency
SAR SBN Acceptance / Handover Review
SS/L-E338830 - Rev. C
Exhibit A-2
vi
12/01/06
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restriction on the title page.
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SBAS Satellite Beam Access Subsystem
SBN Space Based Network
S-BSS Satellite Base Station Subsystem
SI System Integration
SOCC Satellite Operations Control Center
SOH SBN Operations Handbook
SOW Statement of Work
SS/L Space Systems/Loral
SVOT SBN Validation Operations Plan
TBD To Be Determined
TIM Technical Interchange Meeting
TRR Test Readiness Review
TT&C Telemetry, Tracking, & Command
SS/L-E338830 - Rev. C
Exhibit A-2
vii
12/01/06
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restriction on the title page.
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SS/L-E338830 - Rev. C
Exhibit A-2
viii
12/01/06
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1 -- SCOPE
The Statements of Work (SOW) define the goods, hardware, equipment, services,
data and documentation to be provided by Space Systems/Loral, Inc. (SS/L)
(hereinafter "Contractor") to TerreStar (hereinafter "Purchaser") for the S-Band
Space-Based Network Program (hereinafter "Program").
Contractor shall be responsible for all activities connected with the design,
development, deployment, verification, and planning of operations for the
TerreStar S-band Space Based Network (SBN) as defined in Exhibit B-2, TerreStar
S-Band Space-Based Network Technical Performance and Design Requirements as
delivered and approved per Annex 1.
Contractor shall also support TerreStar in the conduction of system level
analyses and necessary contract changes as defined in Sections 2.1.1.2 through
2.1.1.5 and 2.2.1 of this SOW.
1.1 SUMMARY STATEMENT OF WORK
a. Contractor shall review Purchaser's system requirements, baseline
system level performances and products and services information
provided by Purchaser to verify the flow down of requirements to the
Satellite and the Satellite Beam Access Subsystem (SBAS) activities.
The analysis shall optimize system flexibility versus performance
versus time. The beam forming algorithms will be one of the primary
areas of study where a tradeoff between accuracy versus speed in
calculating beam coefficients, considering all sources of beam
pointing error, shall be done.
b. Contractor shall propose modifications to the Contract as required to
meet the level of performance as reflected in Exhibit B-2, SBN
Performance Specifications, in effect as of SBN EDC.
c. Contractor shall oversee the Satellite and SBAS activities (in
accordance with the requirements contained in their respective and
applicable Exhibits) to ensure the progress of the two segments is in
line with the schedule and the requirements of the SBN.
d. Contractor shall verify proper delivery, sell-off, and operations of
the SBN.
e. Contractor shall demonstrate the beam forming functionality during on
ground testing with the Satellite and SBAS Operational Component and
the end-to-end system performance with the Satellite and SBAS
Operational Component during in-orbit testing.
SS/L-E338830 - Rev. B-7
Exhibit A-2
1
09/07/06
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restriction on the title page.
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f. Contractor shall formulate and provide to Purchaser recommended
operating procedures for the SBN and train Purchaser personnel in such
operating procedures.
g. Contractor shall conduct systems engineering analyses for interference
and resource sharing with other Mobile Satellite Systems (MSS) as
described in Section 2.2 of this SOW or as requested by Purchaser as
part of the proposed Time and Material support scheme defined in
Section 2.4 of this SOW.
h. Contractor shall provide data items as specified in the Contract Data
Requirements List (CDRL), Annex 1 of this SOW.
i. Contractor shall conduct all SBN activities under the rules of the
TerreStar Modified Program Management Plan, delivered to Purchaser as
part of the SBN System Integration Proposal in [***].
1.2 PROGRAM SCHEDULE
Contractor activities shall be organized according to the SBN Program Schedule
of Figure 1.1. The Program schedule shall be coordinated with the Purchaser
Program Office prior to SRR and shall be jointly agreed to at SRR.
[***]
SS/L-E338830 - Rev. B-7
Exhibit A-2
2
09/07/06
Use or disclosure of the data contained on this sheet is subject to the
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Figure 1-1: TerreStar SBN Program Schedule
1.3 APPLICABLE DOCUMENTS
In addition to this Exhibit A-2, the following Documents and Exhibits apply to
the Program, provided that, it is understood and agreed that the Satellite
Contract and all associated exhibits are not, by reference herein, part of the
Contract or the scope of work under the Contract:
(A) Satellite Contract (as defined in the Contract):
(i) Exhibit A TerreStar Satellite Statement of Work
(ii) Exhibit B TerreStar Satellite Performance Specifications
(iii) Exhibit D TerreStar Satellite Test Plan
(B) Contract:
(i) Exhibit A-1 SBAS Statement of Work (SOW)
(ii) Exhibit B-1 Satellite-Beam-Access Subsystem Functional and
Performance Requirements Specifications
(iii) Exhibit B-2 TerreStar S-Band Space-Based Network Technical
Performance and Design Requirement
s
(iv) Exhibit D-1 TerreStar Satellite-Beam-Access Subsystem Program
Test Plan
(v) Exhibit D-2 Test Plan (VCRM) for TerreStar S-Band Space Based
Network
(vi) Modified TerreStar Program Management Plan (CDRL SI-01)
(vii) The Terms and Conditions of the Contract
2 -- DELIVERABLES
2.1 SBN DELIVERABLES
2.1.1 SBN Requirements and Design
Contractor shall integrate the SBN and demonstrate that it meets the
requirements of the TerreStar S-Band Space-Based Network Technical Performance
and Design Requirements, Exhibit B-2 as delivered and approved per Section 2.3.9
and Annex 1, tested IAW the SBN Program Test Plan (STP), Exhibit D-2, as
delivered and approved per Annex 1, and deployed for Acceptance on orbit as
specified in Article 9.1.2 of the Contract Terms and Conditions.
SS/L-E338830 - Rev. B-7
Exhibit A-2
3
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2.1.1.1 SBN Architecture and Concepts of Operations
Contractor shall define the basic architecture and concepts of operations for
the SBN on the basis of the information provided by Purchaser, as of PDR, on
Purchaser system requirements, baseline system level performances and products
and services.
2.1.1.2 SBN Simulations and Analyses
Contractor shall conduct system level analyses and trade studies as required to
predict and demonstrate proper operations and performance of the SBN. The
analyses to be conducted shall cover, as a minimum, the following areas:
a. [***]
b. [***]
c. [***]
d. [***]
e. [***]
f. [***]
g. [***]
h. [***]
i. [***]
j. [***]
k. [***]
2.1.1.3 Requirements Analysis
On the basis of the SBN level performance targets contained in Exhibit B-2, SBN
Performance Specification as of SBN EDC, and the products and services required
by the Purchaser, Contractor shall analyze the requirements of the SBAS (as set
forth in Exhibit B-1, SBAS Performance Specification) and the Satellite (as set
forth in Exhibit B of the Satellite Contract, Satellite Performance
Specification) to determine how to optimize the allocation of requirements to
the two segments (SBAS and Satellite) with the scope of reducing overall program
technical risk and cost while maximizing SBN performance and flexibility.
SS/L-E338830 - Rev. B-7
Exhibit A-2
4
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2.1.1.4 Review of Existing Segment Requirements
Contractor shall review the existing Satellite and SBAS Performance
Specifications, Exhibit B of the Satellite Contract and Exhibit B-1
respectively, and derive achievable levels of performance for the SBN (the
"Predicted SBN Performance") and compare such Predicted SBN Performance against
the requirements set forth in Exhibit B-2, SBN Performance Specification as of
SBN EDC to provide the products and services required by TerreStar.
In case discrepancies are identified, Contractor will make recommendations to
Purchaser including:
a. Level of SBN performance achievable in accordance to the existing Satellite
and SBAS Performance Specifications
b. Recommended Contract changes to fully achieve the original Purchaser SBN
performance targets as contained in Exhibit B-2, SBN Performance
Specification as of SBN EDC.
As a result of this activity, the Parties shall establish the Definitive SBN
Performance Specification as provided in Section 2.3.9 and Annex 1 of this SOW
and Article 9.1.1 of the Contract.
The primary performance criteria to be analyzed by Contractor and for which SBN
level performance requirements will be agreed upon with Purchaser will be:
a. User Link side:
(i) [***]
(ii) [***]
(iii) [***]
(iv) [***]
b. Feeder Link side
(i) [***]
(ii) [***]
SS/L-E338830 - Rev. B-7
Exhibit A-2
5
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2.1.1.5 Contract Modifications
In accordance of Article 9.1.1 B of the Contract and related provisions,
Contractor shall negotiate in good faith with Purchaser any modification to the
SBAS and the Satellite Performance Specifications required to incorporate any
additional requirement identified in the course of the tasks described in
Sections 2.1.1.3 and 2.1.1.4 of this SOW.
In particular, additional requirements may require review of the Contract
covering:
a. Task description in the Statement of Work
b. Performance Specifications
c. Test Plans
d. Schedule
e. Cost
Contractor shall be responsible for Delivery of the SBN in compliance with the
Definitive SBN Performance Specification as delivered and approved per Section
2.3.9 and Annex 1, as agreed in good faith in accordance with Articles 10.9 (if
applicable), 9.1.1 and 32.5 of the Contract Terms and Conditions.
2.1.2 SBN Development
2.1.2.1 SBN Performance Tracking
The SBN development shall include the activities covered under the Contract.
Contractor shall have responsibility to oversee such activities and perform, as
a minimum, the following functions:
a. [***]
b. [***]
c. [***]
d. [***]
e. [***]
f. [***]
g. [***]
h. [***]
i. [***]
SS/L-E338830 - Rev. B-7
Exhibit A-2
6
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2.1.2.2 IPT Leadership
Contractor shall be responsible to establish and lead Integrated Product Teams
(IPT's), which will include subcontractor personnel, to address SBN level
issues.
It is anticipated that dedicated IPT's will be established in the following
areas:
a. [***]
b. [***]
c. [***]
d. [***]
e. [***]
2.1.2.3 ICD Development and Control (CDRL SI-19 & SI-20)
Contractor shall develop and maintain all ICD's controlling internal SBN
interfaces that are not contained within the Satellite and SBAS-related
Exhibits.
Examples of these ICD's (CDRL SI-19) are:
a. [***]
b. [***]
c. [***]
Contractor shall also be responsible for the development of the ICD's addressing
external interfaces to the SBN (CDRL SI-20) and to secure the required
cooperation from other entities owning the other end of the interfaces:
a. [***]
b. [***]
c. [***]
SS/L-E338830 - Rev. B-7
Exhibit A-2
7
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d. [***]
e. [***]
2.1.3 SBN Verification
Contractor shall verify proper operations and end-to-end performance for the
SBN. This activity shall include:
a. [***]
b. [***]
c. [***]
d. [***]
e. [***]
f. [***]
g. [***]
SBN operations and performance verification shall be conducted into two separate
phases:
2.1.3.1 Ground Compatibility Demonstration
[***]
SS/L-E338830 - Rev. B-7
Exhibit A-2
8
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[***]
2.1.3.2 SBN In-Orbit Test (IOT)
[***]
2.1.4 Training of Purchaser Personnel (CDRLs SI-14a and SI-14b)
Contractor shall develop, produce and conduct a training program for Purchaser's
personnel experienced in system operations. The objective of the training is to
develop in Purchaser's operations personnel the ability to confidently command
and control the SBN and its interfaces in normal and contingency operations. The
purpose is to provide the essential knowledge and skills experienced personnel
need to safely and reliably execute operations of the SBN.
The Training Plan shall be provided in CDRL SI-14a and contain descriptions of
the curriculum, learning objectives, topics and instructional methods. The
training program shall consist of two (2) total weeks of classroom sessions and
accommodate up to five (5) trainees as listed in Table 2-1.
Table 2-1. Classroom Training Courses
- ----------------------------------------------------------------------
SBN Description Course 1 week Contractor's Facility 5
- ----------------------------------------------------------------------
SBN Operations Course 1 week Purchaser's Facility 5
- ----------------------------------------------------------------------
All class lecture notes and supporting materials shall be provided according to
CDRL SI-14b and shall be documented and presented in English. All training shall
conclude two (2) months before the scheduled start of SBN operations. The
Training Program shall consist of two (2) basic courses:
a. SBN Description -- This one- (1) week course shall present a technical
overview of the SBN architecture and a description of each SBN segment
and shall be conducted at Contractor's facility.
SS/L-E338830 - Rev. B-7
Exhibit A-2
9
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b. SBN Operations -- This one- (1) week course shall be conducted at a
Purchaser-provided facility. This training shall focus on operational
aspects of the SBN and its segments for operational modes under normal
and contingency conditions. Some topics to be covered include: Normal
operations, cold starts, contingency modes, emergency beam
reconfiguration, failure modes, etc.
2.1.5 Initial SBN Operations
[***]
2.1.6 SBN Warranty
Contractor shall provide one (1) year warranty covering SBN performance and
operational capabilities, as specified in Article 13.1.2 of the Contract.
2.1.7 Long-Term Support
2.1.7.1 SBN Emergency and Anomaly Resolution Support Services
Following completion of SBN Acceptance, Contractor shall provide SBN emergency
operations and anomaly resolution support services, as further described herein,
with respect to any anomalies reported to Contractor per Section 2.1.7.2 below,
throughout the SBN operating life. Contractor shall issue and submit to
Purchaser preliminary SBN anomaly reports and final in-orbit anomaly
investigation reports.
Contractor shall maintain the following throughout the SBN operating life, all
subject to any required approvals and coordination under the Satellite Contract:
a. Contractor shall provide a contact point that the Purchaser/operator
can reach twenty-four (24) hours per day, seven (7) days per week, for
purposes of requesting SBN emergency operations and anomaly resolution
support services. The point of contact shall be in the form of a live
person using English as the primary language, who can be reached via
SS/L-E338830 - Rev. B-7
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telephone, email and FAX. The Contractor point of contact shall have
the capability to initiate the assembly of a Contractor Emergency
Support Team (EST) to perform the SBN emergency operations and anomaly
resolution support services described below, but shall not otherwise
have any authority to speak on behalf of Contractor, nor perform
diagnostics, nor provide any type of corrective actions.
b. Upon Purchaser/operator's request for emergency operations and anomaly
resolution support services, Contractor shall promptly establish an
Emergency Support Team (EST) at Contractor's facilities. The EST shall
have the authority to perform diagnostics and give recommendations for
corrective actions. The EST shall have the capability to communicate,
using English as the primary language, via telephone and FAX. The
Purchaser/operator shall be responsible for promptly providing the EST
with the necessary and appropriate Satellite command and telemetry
data, as the EST support may by affected/limited by lack of real-time
telemetry. If it is later determined that the EST support was required
as a result of Purchaser/operator error, including lack of
Purchaser/operator personnel who have been trained by Contractor or
who are otherwise properly trained, or due to negligence on the part
of Purchaser/operator, Purchaser shall reimburse Contractor for such
EST support on a time and materials basis.
c. Contractor shall maintain equipment that is required at Contractor's
facilities for SBN emergency operations and anomaly resolution support
(not including equipment for such support for the SBAS). Contractor
shall coordinate with ground segment contractors during the SBN
operating life as required to procure information and performance data
but said process may not be in real-time.
d. Contractor shall maintain a library of data and documents generated
during the SBN development and test at the Contractor's facilities.
Contractor shall correct, at Contractor's expense, any errors found in
such documentation that is determined by Contractor to be a risk to
SBN operations.
e. Upon Purchaser/operator's request, Contractor shall provide an
analysis of all SBN anomalies occurring during the SBN operating life.
A SBN anomaly includes any malfunction affecting performance or
availability or reducing flexibility of operations.
Upon notification by Purchaser/operator of such a SBN anomaly,
Contractor shall promptly advise the Purchaser/operator of reasonable
actions consistent with accepted industry practices to analyze the
anomaly and where possible, suggest and take corrective action that
will minimize any operational impacts arising from any such SBN
SS/L-E338830 - Rev. B-7
Exhibit A-2
11
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anomaly; provided however, Contractor's obligations to take corrective
action with respect to the Satellite shall be governed by Article 15.2
of the Satellite Contract, and Contractor's obligations to take
corrective action with respect to the SBAS shall be governed by
Article 13.1.1 of the Contract. Purchaser/operator shall notify
Contractor of all SBN anomalies, as part of Purchaser's monthly report
to Contractor, within thirty (30) days after the anomaly is first
observed. In addition, Purchaser shall provide any operational history
and appropriate status and configuration data to allow Contractor to
analyze the anomaly. Contractor shall provide a final written anomaly
report, including a description of the anomaly, the cause of the
anomaly, when such cause can be determined using reasonable efforts
consistent with standard industry practices, and any corrective action
taken or recommended.
2.1.7.2 Notification of Anomalies
Purchaser/operator shall notify Contractor in a timely manner of all SBN
anomalies or other failures occurring in the SBN after the anomaly is first
observed as such. This transfer of information is needed to ensure that
Contractor is always aware of the current health/status of the SBN should the
need for emergency support arise. Contractor shall treat this information as
proprietary to Purchaser.
2.2 DELIVERABLE SYSTEM LEVEL INTERFERENCE ANALYSES AND SUPPORT
In addition to assuming end-to-end responsibility for the SBN pursuant to this
SOW, Contractor shall provide support for interference analyses and regulatory
activities as described in Sections 2.2.1 and 2.2.2 below.
Purchaser shall provide Contractor with adequate input data and service
information to allow the conduction of meaningful interference analyses.
All analyses shall be conducted in accordance with input parameters suggested by
Contractor and agreed upon by Purchaser by PDR.
2.2.1 Interference Analyses (CDRL SI-18)
Contractor shall perform the analyses described below. The results of the
analyses will be documented and provided to the Purchaser as CDRL SI-18.
2.2.1.1 Self Interference for TerreStar Satellite and ATC
Contractor shall conduct self interference analyses addressing multiple modes of
interference:
a. [***]
SS/L-E338830 - Rev. B-7
Exhibit A-2
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b. [***]
c. [***]
d. [***]
Contractor shall also propose and evaluate concepts for overall frequency
management taking into account the efficiency and the performance [***].
Resulting capacity and performance impacts shall be evaluated for the different
frequency management concepts.
The interference scenario evaluation shall be agreed upon by Purchaser and shall
be based on:
a. ATC market location and traffic assumptions
b. Satellite traffic assumptions
2.2.1.2 Interference with Other MSS Systems
Contractor shall conduct a survey of other existing and proposed S-band MSS
systems and propose appropriate input parameters for interference analyses to be
agreed upon by Purchaser.
Contractor shall characterize the interference effects from existing and
proposed satellites of competing systems and provide expected capacity and
quality of service performance assessments under interference conditions.
2.2.1.3 [***]
SS/L-E338830 - Rev. B-7
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2.2.2 Technical Regulatory Analyses and Negotiation Support
2.2.2.1 Regulatory Support with Other MSS Systems
On the basis of specific interference analyses, Contractor shall support
coordination and negotiations with other MSS systems for:
a. Frequency sharing
b. Frequency segregation
c. Notional satellite and user terminal assumptions
d. System performance degradation
e. Acceptable interference levels
2.2.2.2 Coordination Support with Regulatory Entities
On Purchaser request, Contractor shall represent or support Purchaser in the
interface and negotiations with national and international regulatory entities
(FCC, ITU, etc.) including:
a. Responding to inquires from the regulatory bodies
b. Supporting discussions on frequency needs, capacity and system
performance
c. Attending official meetings for frequency allocation and negotiations
2.2.3 Sharing Opportunities
Contractor shall perform the analyses described below based on information that
is publicly available and/or provided by the Purchaser. The results of the
analyses will be documented and provided to the Purchaser as CDRL SI-18.
2.2.3.1 Cooperation with S-band MSS Systems
Contractor shall analyze and make recommendations on the opportunity for
Purchaser's satellite customers to use the service of other MSS systems at
S-band. Contractor shall provide support in the following activities:
a. Assessment of user terminal compatibility requirements for system
interoperability
b. Discussions and coordination with other S-band MSS operators for
interoperability
c. Draft agreements for inter satellite system interoperability
SS/L-E338830 - Rev. B-7
Exhibit A-2
14
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2.2.3.2 Cooperation with L-band and S-band ATC networks
a. Contractor shall analyze and make recommendations on the opportunity
for Purchaser satellite customers to use the service of other
associated MSS systems at different frequency and, in particular, at
L-band. Contractor shall provide support in the following activities:
Analysis of Issues with multiple user terminal frequencies
b. Feasibility of interoperability among multiple satellites and ATC
networks
c. Considerations on common versus separate ATC resource management
centers
2.3 DELIVERABLE DATA ITEMS
2.3.1 General
Contractor shall provide the data items listed in Annex 1, Contract Data
Requirements List (CDRL), of this SOW. The location for delivery of data items
shall be as specified in the Contract or as otherwise mutually agreed. All
deliverable data items shall comply with standard commercial practice.
Contractor shall submit changes to delivered data items (at Contractor's option)
either as a complete revised edition of the delivered item, or as change
insertion sheets with a matrix indicating the latest revision status of each
page of the document.
Contractor shall submit CDRL data items for Purchaser approval/acceptance or
information as specified in Annex 1. Any data or documentation provided
hereunder shall be in the English language and, if in electronic form, shall be
embodied in, or in a form compatible with, Microsoft Office software.
2.3.2 Electronic Access
With respect to electronically generated information, Contractor will provide
Purchaser Personnel with a copy of and/or electronic access (via the Internet,
Contractor e-mail, on-line database and documentation centers, proprietary or
otherwise, or as agreed upon) to such information as is necessary to keep
Purchaser advised, on a current basis, of Program issues, decisions, and
problems. Contractor shall provide Purchaser Personnel access to Contractor's
electronic mail systems through the Internet. If requested in writing by
Purchaser, Contractor shall establish secure data links between its and
Purchaser's facilities such that Purchaser has remote electronic access to all
documentation generated in performance of the Work and entered into Contractor's
documentation and data management system; provided, however, Contractor shall be
required to provide such links for a high-data transfer rate (such as for
Satellite telemetry) only on an as needed basis, with each Party bearing the
costs of establishing the link at its end.
SS/L-E338830 - Rev. B-7
Exhibit A-2
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Contractor will also provide Purchaser Personnel at no cost with "real time"
access to all measured test data for the Work taken at the facilities of
Contractor and/or its subcontractors hereunder.
2.3.3 Program Management Plan (CDRL SI-01)
Contractor shall submit a Program Management Plan (PMP) IAW CDRL SI-01 that
describes Contractor's Program organization, general management, and technical
baseline management. The PMP may be integrated into the existing Satellite
Program Management Plan. The major topics of the PMP shall be as a minimum:
a. Contractor's Program Management Office
1. Program Management Office (PMO) Organization Chart
2. Key PMO personnel roles and responsibilities
3. Major Subcontractor(s)
b. Program Management
1. Contract Monitoring and Control
2. Schedule Status and Control
3. Configuration and Data Management
4. Action Item Control and resolution
5. Meeting Coordination
6. Progress Reporting
c. Technical Management
1. System Engineering
2. System Validation Plan
3. Technical Reviews (Design, Readiness)
4. Subcontract Management
5. Contract Work Breakdown Structure
6. Contract Data Requirements List
7. Purchaser's Resident Field Office
8. System Interface Control and Compatibility Verification
SS/L-E338830 - Rev. B-7
Exhibit A-2
16
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(a) RF and Data Interface Control requirements
(b) On-ground Compatibility Test Methodology and Test Setup
(c) In-Orbit End-to-End Performance Test Methodology and Test
Setup
2.3.4 Program Master Schedule (CDRL SI-02)
Contractor shall provide a Program Master Schedule, CDRL SI-02, that establishes
and maintains the SBN delivery schedule ("Baseline Schedule"). The Master
Schedule shall be updated monthly and shall accurately track progress of Program
events or milestones against the Baseline Schedule:
a. Major SBN deliverable items
b. Subcontractor events and deliveries
c. Major program reviews
d. Segment level acceptance and qualification tests
e. System level verification tests
f. Pre-launch, launch and post-launch activities up to and including
in-orbit test and SBN Acceptance
g. Identification of critical paths
Status reports of progress against the Baseline Schedule shall be prepared and
furnished as part of the Monthly Progress Report.
2.3.5 Monthly Progress Report (CDRL SI-09)
Contractor shall provide monthly Progress Reports, CDRL SI-09. The Monthly
Reports shall show program and technical accomplishments, highlighting
significant events and problems in design, deviations and/or non-conformances,
schedule, subcontracts, integration and test, and mission operations. The report
shall include a section on the status of system budgets, system performance and
contract documentation status, and will highlight any problems which impact
these activities.
Although included in the Monthly Report, the Contractor shall promptly notify
the Purchaser of all major system level non-conformances and recommend
appropriate workarounds.
SS/L-E338830 - Rev. B-7
Exhibit A-2
17
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2.3.6 SBN Requirement Review Data (CDRL SI-03)
Contractor shall furnish agenda, invitation, data package, presentation
material, minutes, and closeout report for the SBN Requirement Review (SRR) as
described in Paragraph 3.3.2, and deliver SRR data IAW CDRL SI-03. The SRR data
shall include:
a. Concepts of operations
b. SBN requirements
c. Internal and external SBN interfaces
d. Preliminary architecture
e. Design options, trades and studies
f. Preliminary budgets and margins
2.3.7 Preliminary Design Review Data (CDRL SI-04)
Contractor shall furnish agenda, invitation, data package, presentation
material, minutes, and closeout report for the Program Development Review (PDR)
IAW CDRL SI-04. The PDR meeting is specified in Paragraph 3.3.3. The PDR data
shall include:
a. Summary description of SBN and system designs
b. System requirements and specifications, including interfaces
c. Summary of deviations from initial requirements
d. Program master schedule
e. Technical description of SBN
f. Performance compliance matrix (design verification matrix)
g. Preliminary SBN test and validation approach (test plan
implementation)
h. Preliminary risk mitigation plan
2.3.8 Critical Design Review Data (CDRL SI-05)
Contractor shall provide agenda, invitation, data package, presentation
material, minutes, and closeout report for the Critical Design Review (CDR) IAW
CDRL SI-05. The CDR meeting is specified in Paragraph 3.3.4. The CDR data shall
include:
a. Technical description of SBN
o Results and summary description of SBN design analyses
o Segment and interfaces status summaries
SS/L-E338830 - Rev. B-7
Exhibit A-2
18
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b. Program master schedule
c. Performance compliance matrix (design verification matrix)
d. Design analysis reports
e. Development status
f. Critical items list
g. SBN Validation Plan and schedule
h. Risk mitigation status
Updates shall be provided as required.
2.3.9 SBN Performance Specification (CDRL SI-21)
As of SBN EDC, Exhibit B-2, SBN Performance Specification, is a preliminary
draft of the SBN Performance Specification. At the conclusion of the activities
described in Section 2.1.1, the preliminary draft of the SBN Performance
Specification may be modified in accordance with Article 9.1.1.B of the
Contract, resulting in the Definitive SBN Performance Specification. Exhibit B-2
shall be amended to reflect the Definitive SBN Performance Specification.
2.3.10 SBN Operations Concept Report (CDRL SI-22)
At the conclusion of the activities described in Section 2.1.1.1 of this SOW,
Contractor shall provide a report describing the Operations Concepts for the
SBN, including, as a minimum:
a. Main functions
b. Top level SBN and segment description
c. Interactions between segments and major interfaces
2.3.11 SBN Analysis Reports (CDRL SI-15)
Contractor shall perform the analyses and trades specified in Section 2.1.1.2 of
this SOW, to support the viability of the SBN design and its conformance to the
SBN Performance Specification, Exhibit B. Contractor shall document the results
of these analyses IAW CDRL SI-15, SBN Analysis Reports. The SBN Analysis Reports
shall contain summary description and results of these analyses and shall be
provided in the PDR and CDR Data Packages, CDRL SI-04 and SI-05.
SS/L-E338830 - Rev. B-7
Exhibit A-2
19
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2.3.12 Program Test Plans, Procedures and Reports
2.3.12.1 SBN Test Plans (CDRL SI-06)
Exhibit D-2 is a preliminary draft of the SBN Test Plans. At PDR, Contractor
shall submit an updated, comprehensive SBN Test Plan for each of the following
major test phases:
(i) SBN Ground Compatibility Demonstration
(ii) SBN IOT
These plans shall include:
(i) Identification of the parameters to be tested
(ii) Top level approach for the tests
(ii) Verification test matrix
Exhibit D-2 shall be amended to reflect the approved, comprehensive SBN Test
Plan.
2.3.12.2 SBN Test Procedures (CDRL SI-07)
Contractor shall submit detailed SBN Test Procedures for each of the following
major test phases:
(i) SBN Ground Compatibility Demonstration
(ii) SBN IOT
These procedures shall include:
(i) Detailed description of the test set up and Satellite and SBAS
configurations
(ii) Detailed instructions for conduction of tests
(iii) Pass / Fail criteria for each test
(iv) Predicts for the test results
2.3.12.3 SBN Test Reports (CDRL SI-08)
Contractor shall submit a comprehensive SBN Test Report for each of the
following major test phases:
(i) SBN Ground Compatibility Demonstration
(ii) SBN IOT
These reports shall include a detailed description of the test set up,
spacecraft and SBAS configurations, the "as run" procedures, and the measured
test data. Analysis and data trending as well as a summary of test anomalies,
non-conformances, and disposition shall be included.
SS/L-E338830 - Rev. B-7
Exhibit A-2
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2.3.13 Data Available On-Site
Contractor shall make available at its facilities the following Program-related
data for Purchaser review:
a. Segment specifications and interface control documents (ICDs)
b. System level test data
c. Major Non-conformance Report (NCR), CDRL SI-12
d. Class 1 Waiver/Deviation Requests and Engineering Change Proposals,
CDRL SI-13
e. System test plans
f. System test and verification data and test reports
2.3.14 SBN Validation Operations Plan (CDRL SI-10)
Contractor shall develop and publish a SBN Validation Operations Plan (SVOP),
CDRL SI-10, covering all activities and events planned to occur during
compatibility demonstrations on the ground and in orbit validation for the SBN.
The SVOP shall contain the information and data needed to guide activities of
operations personnel during these phases. The plan shall include:
a. Operations staff organization, functions and responsibilities
b. Schedules and functions to be staffed for each operation
c. Summary plans, including contingencies for anticipated anomalous
behavior of the different segments
The preliminary SVOP shall be delivered as mutually agreed between Purchaser and
Contractor.
2.3.15 SBN Operations Handbook (CDRL SI-11)
Contractor shall develop and publish a SBN Operations Handbook (SOH) as
delineated in CDRL SI-11. The SOH shall contain the information and data needed
to guide personnel responsible for operating the SBN. The SOH information shall
be the basis for commanding, controlling and maintaining the SBN in normal and
contingency operational modes. The SOH shall consist of four (4) volumes in PDF
format:
a. Volume I, SBN Summary -- An overview of the SBN and its mission,
including high level technical descriptions from a systems
perspective. Volume I shall be delivered as mutually agreed between
Purchaser and Contractor.
SS/L-E338830 - Rev. B-7
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b. Volume II, SBN Technical and Operations Description -- A technical,
detailed engineering level description of the SBN and associated
operational functions to be used as a basis for operating the
integrated SBN.
c. Volume III, SBN Operations Procedures -- Standard and Contingency
Operations Procedures, to be used as a basis for operating the
integrated SBN.
d. Volume IV, SBN Parameters Handbook -- Specific recommended settings
and beginning of life default values for all configurable parameters
in the integrated SBN.
2.3.16 Interference Analysis Reports (CDRL SI-18)
For the interference analyses defined in Section 2.2, a dedicated Interference
Analysis Report shall be provided by Contractor.
2.4 PROPOSAL FOR SECOND SBN
In case Purchaser decides to procure a second Satellite and SBN, Contractor
shall propose and, in good faith, negotiate with Purchaser, an extension of the
activity described in this SOW to cover the additional tasks required for
integration of the second SBN and for coordinated operations of the two SBN's.
During the design and development phase of the first SBN, Contractor shall make
an effort to flag to Purchaser, to the best of its knowledge, any situation or
design choice that could potentially impact the inter-working capabilities of
the two SBN's.
Inter-working capabilities for the two SBN's may include the items described in
SBN Performance Specifications,
Exhibit B-2:
a. In-Orbit Spare Use of Satellites
b. Dual-Satellite Diversity on Return Link
2.5 TIME AND MATERIAL SUPPORT
Purchaser shall be able to request Contractor to provide additional support and
perform additional/modified network oriented analyses on a time and material
basis.
The current conditions offered by Contractor for time and material support are
defined in Contract and are subject to change as defined in Contract.
SS/L-E338830 - Rev. B-7
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Contractor and Purchaser shall negotiate in good faith the scope of any
additional support activity required by Purchaser.
SS/L-E338830 - Rev. B-7
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3 -- PROGRAM REQUIREMENTS
3.1 PROGRAM MANAGEMENT
3.1.1 Program Management Office
Contractor shall establish a Program Management Office (PMO) led by an assigned
Program Manager who shall be responsible for managing all matters related to the
performance of the Contract from SBN EDC through the Initial SBN Operations
Period (including management of all program tasks, status of program progress,
Purchaser visibility into program progress, risk identification and management,
program performance, quality of program deliverables, and other commonly
accepted program management functions). Following the Initial SBN Operations
Period, the Contractor point of contact (ref section 2.1.7.1.a) shall operate as
described. The Program Manager shall ensure that personnel, facilities and other
resources necessary for executing Contract provisions are acquired, assigned and
made available at the times and places needed to meet the Contract delivery
schedule. Contractor shall assign experienced technical and managerial personnel
to the PMO.
3.1.2 Progress Reporting and Meetings
Contractor shall hold weekly status teleconferences and formal, scheduled,
progress review meetings throughout the duration of the Program. Purchaser
Personnel shall be entitled to attend the meetings and reviews (including
meetings and reviews held by electronic means) of Contractor and of Contractor
with any subcontractor(s) hereunder where such meetings and reviews (or portions
of such meetings and reviews) are related to Purchaser's project schedule,
management, engineering, design, integration, or testing. Contractor shall plan
(including provision to Purchaser of an agenda within a reasonable period in
advance of the meeting or review), organize (including arranging access for
Purchaser and Purchaser Personnel), conduct (including the taking of minutes and
action items) and close the meetings (including circulation of the minutes
within five (5) business days following the meeting, management of action item
closure including planning, tracking, weekly status, and other commonly accepted
program management functions). The purpose of these meetings is to provide
Purchaser with pertinent Program implementation and execution data for review,
and to mutually agree upon appropriate courses of action to be taken on
identified action items. In addition to the reviews required by the Satellite
and SBAS SOWs, the following meetings shall be held with details as specified in
Paragraph 3.3 of this SOW:
SS/L-E338830 - Rev. B-7
Exhibit A-2
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(i) Quarterly Program Status Meetings
(ii) SBN Requirements Review (SRR)
(iii) Preliminary Design Review (PDR)
(iv) Critical Design Review (CDR)
(v) Test Readiness Reviews (TRR's)
(vi) Post-Test Data Reviews (PTDR's)
(vii) SBN Acceptance / Handover Review (SAR)
Other meetings, e.g., Technical Interchange Meeting (TIM), as may be requested
by Purchaser, including their location, date/time, purposes and content, shall
be established by mutual agreement.
3.2 RESERVED
3.3 PROGRAM AND TECHNICAL REVIEWS
Contractor shall plan, organize, administer, conduct and close the reviews
listed herein. The objective of these reviews is to evaluate critical
programmatic and technical parameters and processes, and related documentation
to obtain information for deciding to proceed to the next Program phase.
3.3.1 Quarterly Program Status Meetings
A Quarterly Program Status Meeting shall be held on three (3) month intervals,
alternating between Contractor's and Purchaser's facility. The meeting shall be
scheduled on a mutually agreed upon date and time. Content of the review shall
include all technical, programmatic, quality, and contractual accomplishments
and issues over the past three (3) months or since the last Quarterly Management
Review for the entire SBN. Any issues that impact SBN delivery or compliance to
the contractual requirements shall be highlighted. Significant risks to the
Program shall also be presented with actions identified for risk management. As
received, action items from the meeting shall be tracked and submitted to
Purchaser for approval. The first such meeting shall be held as mutually agreed
between Purchaser and Contractor.
3.3.2 SBN Requirements Review (SRR)
Contractor shall conduct a SBN Requirements Review (SRR) at its facility prior
to, or in conjunction with, PDR. The purpose of the SRR is to review the
understanding of the SBN level requirements that will regulate the conduction of
the Program activities and execution of the Contract. The SRR shall be
SS/L-E338830 - Rev. B-7
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considered closed upon sign off of the minutes and action item list with closure
dates established. All data items listed in Section 2.3.6 of this SOW shall be
addressed during the SRR.
3.3.3 Preliminary Design Review
Contractor shall conduct a Preliminary Design Review (PDR) at its facility
within [***] after SBN EDC or no more than [***] after the PDR for both the
Satellite and the SBAS Work are concluded, whichever comes later. The purpose of
the PDR is to review the development and design feasibility of the SBN and
verify performance based on the results of the segment PDR's. A test methodology
for SBN validation, both on the ground and in orbit, shall be presented during
PDR. Risks shall be evaluated on a technical, schedule and cost basis. All items
listed in Section 2.3.7 of this SOW, as appropriate, shall be addressed. The PDR
shall be considered closed with sign off of the minutes and action item list
with closure dates established.
3.3.4 Critical Design Review
Contractor shall conduct Critical Design Reviews (CDRs) at its facility per the
Program Master Schedule or no more than [***] after the CDR for both the
Satellite and the SBAS Work are concluded, whichever comes later. The purpose of
the CDR is to ensure that the design meets the requirements of the Definitive
SBN Performance Specification. All items listed in Section 2.3.8 of this SOW, as
appropriate, shall be addressed. The outcomes of the CDR shall be a
determination that the detailed designs and their development satisfy the
functional and performance requirements and verification that all system
interfaces are compatible. A final test plan for SBN validation, both on the
ground and in orbit, shall be presented for Purchaser review and approval. The
CDR shall be considered closed with sign off of the minutes and action item list
with closure dates established.
3.3.5 Test Readiness Reviews
Contractor shall conduct Test Readiness Reviews (TRRs) to confirm readiness to
conduct each one of the system test activities defined in Section 2.1.3 of this
SOW and in conformance with the SBN Test Plan. The purpose of the TRR is to
ensure that the system, the segments of the SBN and the performing organizations
are ready to begin formal testing. Contractor's system engineering shall verify
that planned and authorized tests will yield the data needed to prove
performance requirements have been satisfied. The completed TRR shall confirm
the completeness of test procedures by a thorough review of:
SS/L-E338830 - Rev. B-7
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a. Personnel and facility readiness
b. Test plan, procedures, cases and limits
c. New or modified test support equipment, facilities and procedure
manuals
d. Performance test predicts.
3.3.6 Post-Test Data Reviews
Contractor shall conduct post-Test Data Reviews at the completion of each one of
the system test activities defined in Section 2.1.3 of this SOW and in
conformance with the SBN Test Plan. Test data and results, the "as run"
procedure, deviations, test anomalies, and non-conformances shall be presented.
Test anomalies and non-conformances shall be recorded and evaluated for
consequences on system performance or capabilities.
3.3.7 SBN Acceptance/Handover Review (CDRL's SI-16 and SI-17)
Contractor shall provide the SBN Summary Acceptance Report (CDRL SI-16) to
Purchaser at least twenty-four (24) hours prior to conducting the SBN
Acceptance/Handover Review (SAR). Contractor shall conduct the SAR within three
(3) Business Days after completing the SBN IOT. The SAR will be held either at
Purchaser's facility or Contractor's facility, by mutual agreement. The purpose
of the SAR is to evaluate SBN system data obtained during SBN IOT and to confirm
that the SBN satisfies the acceptance criteria defined in the Test Procedures,
CDRL SI-07. The Deliverable Data for the SAR shall consist of the SBN Summary
Acceptance Report, CDRL SI-16 and SBN Acceptance Certificate (CDRL SI-17).
Acceptance of the SBN shall be IAW Article 9.1.3 of the Contract.
After SAR, Contractor shall provide updates, as required, of SBN operational
configuration data, database, and initial/default parameters.
3.4 PURCHASER FURNISHED ITEMS
3.4.1 Equipment, Facilities and Services
Purchaser and Contractor shall participate in a Technical Interchange Meeting
(TIM) at a mutually agreed to date after SBN EDC to review and agree upon the
availability and adequacy of equipment, facilities and services listed below.
a. Contractor and, as needed, Contractor's subcontractor personnel shall
be allowed access to Purchaser-owned Earth station sites or facilities
that are within the proper look angle of the Satellite at its
on-station orbital location. Such access shall include RF/IF
SS/L-E338830 - Rev. B-7
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communications equipment, GBBFs, TT&C facilities and equipment,
standard communications test equipment and support services and shall
be limited to those items already in place, functioning and available
at Purchaser's facilities. Contractor shall be responsible for any
additional required items to support In-Orbit SBN Validation.
Contractor shall comply with the then-current security policies
applicable to each such facility.
b. At each Ground Station site, Purchaser shall provide space and
interface support for temporary installation of Contractor-provided
SBN In-Orbit Validation Equipment. Purchaser shall designate one
Ground Station as the "SBN Validation Coordination Center."
c. Contractor shall be allowed reasonable access to and use of
Purchaser's test and support technicians during on-site installation,
integration and test activities.
d. At or in close proximity to the SBN Validation Coordination Center,
Purchaser shall provide reasonable office space, conference room, and
administrative areas for Contractor and subcontractor personnel during
temporary installation of Contractor-provided SBN In-Orbit Validation
equipment. These locations shall be equipped with telephones, fax, and
copier.
e. Purchaser shall provide the following personnel to support SBN
In-Orbit Validation:
(i) SBN In-Orbit Validation Director, who shall be stationed at the
SBN Validation Coordination Center and work with Contractor's
representatives to support day-to-day operations.
(ii) Technical Representative, who shall be stationed at the SBN
Validation Coordination Center and approve test data with
Contractor's representatives.
3.4.2 Data and Information
a. Purchaser shall provide Contractor with input data and service
information to allow the conduction of meaningful interference analyses.
Such data shall include:
(i) ATC market location and traffic assumptions
(ii) Satellite traffic assumptions
b After the SBN Acceptance and during the normal on-orbit operations,
Purchaser will provide monthly on-orbit performance reports to Contractor.
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c. In order to support anomaly analysis and resolution during the life of
the Satellite, Purchaser will provide data on the anomalies requested by
Contractor.
3.5 COMPLIANCE WITH US EXPORT CONTROL LAWS
The Parties shall conduct activities hereunder IAW Article 7 of the Contract.
SS/L-E338830 - Rev. B-7
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ANNEX 1 -- CONTRACT DATA REQUIREMENTS LIST (CDRL)
- -------------------------------------------------------------------------------------------
No. Title Class Due Date SOW Paragraph
- -------------------------------------------------------------------------------------------
SI-01 Program Management Plan I Preliminary at SRR 2.3.3
and Final at PDR
- -------------------------------------------------------------------------------------------
SI-02 Program Master Schedule I Preliminary at SRR 2.3.4
and Final at PDR
- -------------------------------------------------------------------------------------------
SI-03 SBN Requirements Review 2.3.6
a. Data Package I 10 Business Days
before review
b. Presentation Materials I 10 Business Days
before review
c. Minutes/ Action Items A At conclusion of
review
d. Close-out Report A 10 Business Days
after review
e. Agenda I 10 Business Days
before review
f. Invitation I 20 Business Days
before review
- -------------------------------------------------------------------------------------------
04 Preliminary Design Review 2.3.7, 3.3.3
a. Data Package I 10 Business Days
before review
b. Presentation Materials I 10 Business Days
before review
c. Minutes/ Action Items A At conclusion of
review
d. Close-out Report A 10 Business Days
after review
e. Agenda I 10 Business Days
before review
f. Invitation I 20 Business Days
before review
- -------------------------------------------------------------------------------------------
SI-05 Critical Design Review 2.3.7, 3.3.4
a. Data Package I 10 Business Days
before review
b. Presentation Material I 10 Business Days
before review
c. Minutes/ Action Items A At conclusion of the
review
d. Close-out Report A 10 Business Days
after review
e. Agenda I 10 Business Days
before review
f. Invitation I 20 Business Days
before review
- -------------------------------------------------------------------------------------------
SS/L-E338830 - Rev. B-7
Exhibit A-2
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SOW
No. Title Class Due Date Paragraph
- -------------------------------------------------------------------------------------------
SI-06 SBN Test Plans I Preliminary plans due 2.3.12.1
at PDR. Final plans
due at CDR
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SI-07 SBN Test Procedures I 20 Business Days 2.3.12.2
before test
- -------------------------------------------------------------------------------------------
SI-08 SBN Test Reports I Preliminary reports 2.3.12.3
due 5 Business Days
after each major test
phase. Final Reports
due at Post Test Data
Reviews
- -------------------------------------------------------------------------------------------
SI-09 Monthly Progress Report I First Issue: SBN 2.3.5
EDC+1 month,
subsequent by 10th of
each month
- -------------------------------------------------------------------------------------------
SI-10 SBN IOT Mission Operations Plan I Preliminary delivery 2.3.14
as mutually agreed
Final: 6 months
before SBN In-Orbit
Validation
- -------------------------------------------------------------------------------------------
SI-11 SBN Operations Handbook (SOH) A 2.3.15
---------------------------------- ---------------------------------------
SOH, Volume I, SBN Summary Initial delivery at 2.3.15 (a)
CDR +3 mo, updates as
required
Final update at
completion of SBN
In-Orbit Validation +
1 month
---------------------------------- ---------------------------------------
SOH, Volume II, SBN Technical Initial 6 months 2.3.15 (b)
and Operations Description before Launch,
updates as required
Final update at
completion of IOT + 1
month
---------------------------------- ---------------------------------------
SOH, Volume III, SBN Operations Initial 6 months 2.3.15 (c)
Procedures before Launch,
updates as required
Final update at
completion of SBN
In-Orbit Validation +
1 month
---------------------------------- ---------------------------------------
SOH, Volume IV, SBN Parameters Initial 1 month 2.3.15 (d)
Handbook before Launch,
updates as required
Final update at
completion of SBN
In-Orbit Validation +
1 month
- -------------------------------------------------------------------------------------------
SS/L-E338830 - Rev. B-7
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SI-12 Major Non-conformance Report I Within 24-hour after 2.3.13 (d)
occurrence
- --------------------------------------------------------------------------------------------
SI-13 Class I Waivers, Deviations, A As required 2.3.13 (e)
and Engineering Change Proposals
- --------------------------------------------------------------------------------------------
SI-14 Purchaser Training: 2.1.4
2.1.4
a. Training Plan A 3 months before
training
b. Training Materials I At training
- --------------------------------------------------------------------------------------------
SI-15 SBN Analysis Reports I *Included in PDR and 2.1.1.2,
CDR Data Packages 2.3.11
15a. C/N & C/I Sensitivity to
phase and amplitude errors
15b. GBBF Residual Error Budget
15c. Resource Consumption for
Service Channels
15d. Correction Range for GBBF & calibration
15e. Feeder Link Availability
15f. Pointing Error Budget & Performance Degradation
15g. Power Control Signal
Budget
15h. Power & Spectrum
Flexibility
15i. End-to-end GBBF Performances
- -------------------------------------------------------------------------------------------
SI-16 SBN Summary Acceptance Report A SAR 3.3.7
- -------------------------------------------------------------------------------------------
SI-17 Satellite Acceptance Certificate A SAR 3.3.7
- -------------------------------------------------------------------------------------------
SI-18 Interference Analysis Reports I As Mutually agreed 2.2, 2.3.16
- -------------------------------------------------------------------------------------------
SI-19 SBN Internal ICD's I Draft at PDR, Final 2.1.2.3
at CDR
19a. Satellite / FES ICD
19b. Satellite / Calibration ICD
19c. Satellite / GBBF ICD
- -------------------------------------------------------------------------------------------
SI-20 SBN External ICD's I Draft at PDR, Final 2.1.2.3
20a. FES / TT&C ICD at CDR (subject to
counterpart
20b. CMS / SOCC ICD availability),
Review following
20c. GBBF / S-BSS ICD contacts with
counterparts on
20d. CMS / CRMS ICD specific interfaces
20e. CMS / NOMC ICD
- -------------------------------------------------------------------------------------------
SS/L-E338830 - Rev. B-7
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SI-21 SBN Performance Specification A Preliminary Draft at 2.3.9
(Exhibit B-2) SBN EDC, Update at
PDR, Final at CDR
- --------------------------------------------------------------------------------------------
SI-22 Operations Concept Report I Draft at PDR, Final 2.3.10
at CDR
- --------------------------------------------------------------------------------------------
SS/L-E338830 - Rev. B-7
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Satellite-Beam-Access Subsystem
Exhibit B-1
Functional and Performance Requirements
Specifications
Revision 1.2 December 1, 2006
Space Systems/Loral
3825 Fabian Way
Palo Alto, California 94303 __________________________________
TerreStar Networks, Inc.
One Discovery Place
12010 Sunset Hills Road
Reston, Virginia 20190 __________________________________
- --------------------------------------------------------------------------------
This document contains data and information proprietary to Space Systems/Loral,
Inc. and TerreStar Networks Inc. This data is being furnished pursuant to the
provisions of the Contract between TerreStar Networks Inc. and Space
Systems/Loral, Inc. for the TerreStar Satellite Program. Space Systems/Loral,
Inc. and TerreStar Networks Inc. shall have the right to duplicate, use or
disclose the data and information to the extent specified in the Purchase
Contract.
- --------------------------------------------------------------------------------
The data/information contained herein has been reviewed and approved for release
by Space Systems/Loral Export Administration on the basis that this document
contains no export-controlled information.
- --------------------------------------------------------------------------------
Exhibit B-1 Revision 1.2
12/01/06
1/58
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1.0 SCOPE
This document and its appendix detail the functional and performance
requirements of the Satellite-Beam-Access Subsystem (SBAS) of the
TerreStar Hybrid Network.
2.0 APPLICABLE DOCUMENTS
- Contract Terms and Conditions
- Satellite Beam Access Subsystem, Statement of Work (SOW), Exhibit A-1
- Satellite Beam Access Subsystem, Program Test Plan, Exhibit D-1
- Satellite Beam Access Subsystem, Payment Plan and Termination
Liability Amounts, Exhibit E-1
3.0 INTRODUCTION
The SBAS Operational Component will be used with the TerreStar S-band
Satellite to form hundreds of forward and return link beams. [***].
Contractor shall provide a fully designed, developed, installed,
integrated, tested and verified SBAS in compliance with this document
and in accordance with the Statement of Work (SOW), Exhibit A-1.
Appendix A summarizes of the functional design and key performance
specifications pertaining to the TerreStar Satellite payload. The
Satellite, along with the SBAS Operational Component create the full
constellation of satellite user spot beams through which the MSS
services of the TMCN network are delivered.
Delivery of the SBAS Deliverable Items shall be in accordance with the
requirements of the SBAS SOW, Exhibit A-1. Its integration, test and
verification shall include due consideration for the provision of all
the necessary interfaces with other Ground Stations and SAN.
4.0 FUNCTIONAL AND PERFORMANCE REQUIREMENTS FOR THE SATELLITE
-BEAM-ACCESS-SUBSYSTEM (SBAS)
[***]
Exhibit B-1 2/57
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[***]
4.1 General
[***]
Exhibit B-1 3/57
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[***]
4.2 Air-Interface
[***]
4.3 Beam Formation and Placement
[***]
Exhibit B-1 4/57
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[***]
Exhibit B-1 5/57
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[***]
Exhibit B-1 6/57
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4.4 Ku-Band Feeder Link Earth Stations and CES
[***]
Exhibit B-1 7/57
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4.5 End-To-End Performance
[***]
Exhibit B-1 8/57
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4.6 Interface Area
[***]
Exhibit B-1 9/57
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4.7 Operational Area
[***]
Exhibit B-1 10/57
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TerreStar Mobile Communications Network (TMCN)
Satellite Access Network (SAN)
Satellite-Beam-Access Subsystem
SRS Exhibit B-1
Appendices
Appendix A: TerreStar Satellite Summary Design and Performance
Specifications
Appendix B: Ku-Band Feeder Link Earth Station Performance
Characteristics
Appendix C: A Typical Satellite Link Budget using CDMA-2000 as the
Mobile Air Interface Signal
[***]
TerrStar Mobile Communications Network (TMCN)
Satellite Access Network (SAN)
Exhibit B-1 11/57
Satellite Gateway (SGW)
Use or disclosure of the data contained on this sheet is subject
to the restriction on the title page.
Satellite-Beam-Access Subsystem
SRS EXHIBIT B
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Figure A.1. TerreStar Mobile Communications Network
Exhibit B-1 12/57
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[***]
Figure A.2. Primary and Secondary Service Areas
Exhibit B-1 13/57
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[***]
Figure A.3. Spot Beam Coverage over CONUS and Canada
Exhibit B-1 14/57
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[***]
Figure A.4. Beam Coverage over Hawaii, Puerto Rico, and US Virgin Island
Exhibit B-1 15/57
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[***]
Exhibit B-1 16/57
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Figure A.5. TerreStar Payload Overview
Exhibit B-1 17/57
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[***]
Exhibit B-1 18/57
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Figure A.6. GW-1 FDM Signal Spectrum
Exhibit B-1 19/57
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[***]
Figure A.7. GW-2 FDM Signal Spectrum
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Figure A.8. TX and RX Directivity
Exhibit B-1 21/57
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[***]
Figure A.9. TX and RX Directivity and C/I (1 of 2)
Exhibit B-1 22/57
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[***]
Figure A.9. TX and RX Directivity and C/I (2 of 2)
Exhibit B-1 23/57
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Exhibit B-1 24/57
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[***]
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Figure A.10. Preliminary S-Band EIRP and G/T Budget
[***]
Figure A.11. Preliminary Ku-Band EIRP and G/T Budget
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[***]
Exhibit B-1 27/57
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Figure A.12. Pointing Error
Exhibit B-1 28/57
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[***]
Figure A.13. Ku-Band and S-Band NPR Performance
Exhibit B-1 28/57
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Exhibit B-1 30/57
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[***]
Figure A.14. Preliminary Group Delay Budget
Exhibit B-1 31/57
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[***]
Figure A.15. Preliminary In-Band Gain Flatness
Exhibit B-1 32/57
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Table A.1. TerreStar Satellite Performance (1 of 2)
Exhibit B-1 33/57
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[***]
Exhibit B-1 34/57
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Table A.1. TerreStar Satellite Performance (2 of 2)
Exhibit B-1 35/57
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[***]
Exhibit B-1 36/57
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Table A.2. TerreStar Forward Frequency Plan for GW-1 and GW-2
Exhibit B-1 37/57
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[***]
Exhibit B-1 38/57
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Table A.3. TerreStar Return Frequency Plan for GW-1 (1 of 2)
Exhibit B-1 39/57
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[***]
Exhibit B-1 40/57
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Table A.3. TerreStar Return Frequency Plan for GW-1 (2 of 2)
Exhibit B-1 41/57
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[***]
Exhibit B-1 42/57
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Table A.4. TerreStar Return Frequency Plan for GW12 (1 of 2)
Exhibit B-1 43/57
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[***]
Exhibit B-1 44/57
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Table A.4. TerreStar Return Frequency Plan for GW-2 (2 of 2)
Exhibit B-1 45/57
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[***]
Exhibit B-1 46/57
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Table A.5. TT&C and Reference Pilot Signals
Exhibit B-1 47/57
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[***]
Exhibit B-1 48/57
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TerreStar Networks
Table A.6. On-Station TT&C Link Parameters
[***]
Exhibit B-1 49/57
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TerreStar Mobile Communications Network (TMCN)
Satellite Access Network (SAN)
Satellite-Beam-Access Subsystem
SRS Exhibit B-1
Appendix B
Ku-Band Feeder Link Earth Station
Performance Characteristics
Exhibit B-1 50/57
Use or disclosure of the data contained on this sheet is subject
to the restriction on the title page.
Table B.1. FES Performance Characteristics
[***]
Exhibit B-1 56/57
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
Table B.2. 5-MHz Service Link Channel Performance: Amplitude, Phase, and Time
Delay Requirements
B.2.1 Gain Flatness: [***]
B.2.2 Transmission Path Gain Matching: [***]
B.2.3 Transmission Path-to-Path Amplitude Variation: [***]
Exhibit B-1 52/57
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to the restriction on the title page.
B.2.4 Amplitude Stability: [***]
B.2.5 Phase Variation: [***]
B.2.6 Phase Stability: [***]
B.2.7 Transmission Path-to-Path Time Delay Variation: [***]
Exhibit B-1 53/57
Use or disclosure of the data contained on this sheet is subject
to the restriction on the title page.
TerreStar Mobile Communications Network (TMCN)
Satellite Access Network (SAN)
Satellite Gateway (SGW)
Satellite-Beam-Access Subsystem
SRS Exhibit B-1
Appendix C
A Typical Satellite Link Budget
Using CDMA-2000
as the Mobile Air Interface Signal
Exhibit B-1 54/57
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to the restriction on the title page.
[***]
Exhibit B-1 55/57
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to the restriction on the title page.
[***]
Exhibit B-1 56/57
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to the restriction on the title page.
100187907_1.DOC
Exhibit B-1 57/57
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TerreStar
S-Band Space-Based Network
Exhibit B-2
Technical Performance and
Design Requirements
Document No.: SS/L - 338831 - Revision B-8 December 1, 2006
Space Systems/Loral
3825 Fabian Way
Palo Alto, California 94303 ________________________________
TerreStar Networks, Inc.
One Discovery Place
12010 Sunset Hills Road
6th Floor
Reston, Virginia 20190 ________________________________
- --------------------------------------------------------------------------------
This document contains data and information proprietary to Space Systems/Loral,
Inc. and TerreStar Networks Inc. This data is being furnished pursuant to the
provisions of the Contract between TerreStar Networks Inc. and Space
Systems/Loral, Inc. for the TerreStar Satellite Program. Space Systems/Loral,
Inc. and TerreStar Networks Inc. shall have the right to duplicate, use or
disclose the data and information to the extent specified in the Purchase
Contract.
- --------------------------------------------------------------------------------
The data/information contained herein has been reviewed and approved for release
by Space Systems/Loral Export Administration on the basis that this document
contains no export-controlled information.
- --------------------------------------------------------------------------------
Revision B-8
12/01/06
Exhibit B-2
1/31
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SS/L- E338831 - Rev. B-8
Exhibit B-2
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CONTENTS
Section Page
GLOSSARY VI
1.0 - TERRESTAR HYBRID NETWORK REQUIREMENTS TREE..................................................................1
2.0 -- HYBRID NETWORK OVERVIEW....................................................................................3
2.1 Hybrid Network Architecture...........................................................3
2.2 Services..............................................................................4
3.0 -- SPACE-BASED NETWORK (SBN) REQUIREMENTS.....................................................................5
3.1 Frequencies and Polarizations.........................................................5
3.1.1 Service Link Frequencies and Polarizations...............................5
3.1.2 Feeder Link Frequencies and Polarizations................................5
3.2 SBN Architecture......................................................................5
3.2.1 Major Components.........................................................5
3.2.2 Satellite and Orbital Locations..........................................7
3.2.3 Number of Ground Stations................................................7
3.3 SBN Functions.........................................................................8
3.3.1 Ku-Band Rain Fade Compensation...........................................8
3.3.2 Interference Reduction...................................................8
3.3.3 TT&C.....................................................................9
3.3.4 Dual-Polarization Diversity on Return Link...............................9
3.3.5 Beam Re-pointing........................................................10
3.4 SBN Coverage Requirements...........................................................10
3.4.1 Number of Spot Beams....................................................10
3.4.2 Spot Beam Configuration Flexibility.....................................10
3.4.3 Spot Beam Geometrical Congruency........................................11
3.4.4 Spot Beam Time Stability and User Terminal Re-Registration..............11
3.4.5 Peak Power and Bandwidth in a Spot Beam.................................11
3.5 SBN End-to-end Performance...........................................................10
3.5.1 SBN Design Life.........................................................12
3.5.2 SBN Service Availability................................................12
3.5.3 Feeder Link Communications Performances.................................12
3.5.4 User Link Communications Performances...................................12
3.6 SBN End-to-End System Tests..........................................................15
3.7 Second SBN Option....................................................................15
3.8 EXTERNAL INTERFACES..................................................................15
SS/L- E338831 - Rev. B-8
Exhibit B-2
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3.8.1 Network Time and Frequency Standards....................................15
3.8.2 TT&C Interfaces.........................................................15
3.8.3 Interface with S-BSS....................................................16
3.8.4 Interface with CRMS.....................................................16
3.9 Telecom System Intreraction..........................................................14
3.9.1 Air Interfaces..........................................................17
3.9.2 Link Budgets............................................................17
3.9.3 Interface with Handheld Mobile Terminal.................................17
3.9.4 SBN Transparency........................................................18
APPENDIX I: TYPICAL LINK BUDGET USING GMR-3G AS MOBILE AIR INTERFACE 17
TABLES
Table Page
Table 3.1. Power Allocation Flexibility to Beams.............................................................10
Table 3.2. Forward Link EIRP SBN Specifications..............................................................11
Table 3.3. Return Link G/T SBN Specifications................................................................12
Table 3.4. User Link Cell Isolation..........................................................................13
FIGURES
Figure Page
Figure 1-1. TerreStar Hybrid Network Requirements Tree.........................................................1
Figure 2.1. TerreStar Hybrid Network Architecture..............................................................3
Figure 3-1. Logical Elements in the TerreStar Hybrid Network...................................................5
Figure 3-2. Feed Elements & Number of Ground Stations for Terrestar Distributed
GBBF...............................................................................................6
SS/L- E338831 - Rev. B-8
Exhibit B-2
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Exhibit B-2
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v
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GLOSSARY
ATC Ancillary Terrestrial (network) Component
ATN Ancillary Terrestrial Network
AUC Authentication center
BSC Base Station Controller
BSS Base Station Subsystem (includes BTS and BSC)
BTS Base Transceiver Station
CES Calibration Earth Station
CFE Customer Furnished Equipment
CDMA Code Division Multiple Access
C/I Carrier to Interference Ratio (signal quality indicator)
C/(N+I) Carrier to Noise and Interference Ratio (signal quality indicator)
C/(No+Io) Carrier to Noise and Interference Density Ratio (signal quality
indicator)
CMS Control & Management System
CONUS Continental United States
CRMS Central Resource Management System
EIRP Equivalent Isotropic Radiated Power
EV-DV Evolution, Data Voice (referred to CDMA system)
FES Feeder Link Earth Station
GBBF Ground Based Beam Forming or Ground Based Beam Former
GMSC Gateway Mobile Switching Center
GPRS General Packet Radio Service
GSM Global System for Mobile
G/T Gain over Temperature Ratio
IF Intermediate Frequency
IOT In-Orbit Testing
L-CMS Local Control & Management System
LHCP Left Hand Circular Polarization
MSC Mobile Switching Center
MSS Mobile Satellite Services
MT Mobile Terminal
NSS Network and Switching Subsystem
PBS Pointing Beacon Station
PCS Personal Communications Service (cellular service offered in the
1900 MHz band).
PDR Preliminary Design Review
SS/L- E338831 - Rev. B-8
Exhibit B-2
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PLMN Public Land Mobile Network
PR Puerto Rico
PSA Primary Service Area
PSTN Public Switched Telephone Network
RF Radio Frequency
RHCP Right Hand Circular Polarization
SBAS Satellite Beam Access Subsystem
SBN Space Based Network
S-BSS Satellite adapted Base Station Subsystem
S-MSC Satellite adapted Master Switching Center
SOC Satellite Operations Center
SOW Statement Of Work
SSA Secondary Service Area
TBC To Be Confirmed
TBD To Be Determined
TDMA Time Division Multiple Access
TT&C Telemetry, Tracking and Control
UMTS Universal Mobile Telecommunications System
USVI United States Virgin Islands
WCDMA Wide-band CDMA
SS/L- E338831 - Rev. B-8
Exhibit B-2
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Exhibit B-2
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1.0 - TERRESTAR HYBRID NETWORK REQUIREMENTS TREE
Purchaser shall provide to Contractor no later than SBN EDC, the most current
system architecture (divided by segment and within each segment by subsystems)
that are either under development or have active or planned solicitation
activities.
Figure 1-1 shows the Requirements Tree for TerreStar Hybrid
(Satellite-Terrestrial) Network (Hybrid Network). This specification document
covers all requirements applicable to the Space Based Network (SBN). If there is
a conflict between this document and the SBAS Performance Specification as
identified in Exhibit B-1 or the Satellite Performance Specification as
identified in Exhibit B to the Satellite Contract, the SBAS and Satellite
Performance Specifications shall be the controlling documents.
The arrows show the logical flow of requirements from higher to lower levels.
Some lower level requirements may be driven by multiple higher level
requirements.
[***]
SS/L- E338831 - Rev. B-7
Exhibit B-2
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SPACE SYSTEMS 1
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Figure 1-1: Notional TerreStar Hybrid Network Requirements Tree
SS/L- E338831 - Rev. B-7
Exhibit B-2
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SPACE SYSTEMS 2
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2.0 -- HYBRID NETWORK OVERVIEW
2.1 Hybrid Network Architecture
[***]
SS/L- E338831 - Rev. B-7
Exhibit B-2
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[***]
[***]
Figure 2-1. Notional TerreStar Hybrid Network Architecture
2.2 Services
[***]
SS/L- E338831 - Rev. B-7
Exhibit B-2
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3.0 -- SPACE-BASED NETWORK (SBN) REQUIREMENTS
3.1 Frequencies and Polarizations
3.1.1 Service Link Frequencies and Polarizations
[***]
3.1.2 Feeder Link Frequencies and Polarizations
[***]
3.2 SBN Architecture
3.2.1 Major Components
[***]
SS/L- E338831 - Rev. B-7
Exhibit B-2
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[***]
SS/L- E338831 - Rev. B-7
Exhibit B-2
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Figure 3-1: Logical Elements in the TerreStar Hybrid Network
3.2.2 Satellite and Orbital Locations
[***]
3.2.3 Number of Ground Stations
[***]
SS/L- E338831 - Rev. B-7
Exhibit B-2
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Figure 3-2: Feed Elements, Bandwidth Partition Per Ground Station, and the
Required
[***]
3.3 SBN Functions
3.3.1 Ku-Band Rain Fade Compensation
3.3.1.1 Diversity Switching
[***]
3.3.1.2 Uplink Power Control
[***]
3.3.2 Interference Reduction.
[***]
SS/L- E338831 - Rev. B78
Exhibit B-2
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SPACE SYSTEMS 8
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LORAL 08/21/06
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to the restriction on the title page.
8
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[***]
3.3.3 TT&C
[***]
3.3.4 Dual-Polarization Diversity on Return Link
[***]
SS/L- E338831 - Rev. B-7
Exhibit B-2
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SPACE SYSTEMS 9
- -------------
LORAL 08/21/06
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to the restriction on the title page.
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[***]
3.3.5 Beam Re-pointing
[***]
3.4 SBN Coverage Requirements
[***]
3.4.1 Number of Spot Beams
[***]
3.4.2 Spot Beam Configuration Flexibility
[***]
SS/L- E338831 - Rev. B-7
Exhibit B-2
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SPACE SYSTEMS 10
- -------------
LORAL 08/21/06
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to the restriction on the title page.
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[***]
3.4.3 Spot Beam Geometrical Congruency
[***]
3.4.4 Spot Beam Time Stability and User Terminal Re-Registration
[***]
3.4.5 Peak Power and Bandwidth in a Spot Beam
[***]
Table 3-1: Power Allocation Flexibility to Beams
[***]
3.5 SBN End-to-end Performance
SS/L- E338831 - Rev. B-7
Exhibit B-2
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SPACE SYSTEMS 11
- -------------
LORAL 08/21/06
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to the restriction on the title page.
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[***]
3.5.1 SBN Design Life
[***]
3.5.2 SBN Service Availability
[***]
3.5.3 Feeder Link Communications Performances
[***]
3.5.4 User Link Communications Performances
[***]
SS/L- E338831 - Rev. B-7
Exhibit B-2
[LOGO OMITTED] 12
SPACE SYSTEMS
- -------------
LORAL 08/21/06
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to the restriction on the title page.
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[***]
3.5.4.1 Forward Link EIRP
[***]
Table 3-2: Forward Link EIRP SBN Specifications
[***]
3.5.4.2 Return Link G/T
[***]
SS/L- E338831 - Rev. B-7
Exhibit B-2
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SPACE SYSTEMS 13
- -------------
LORAL 08/21/06
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[***]
Table 3-3: Return Link G/T SBN Specifications
[***
3.5.4.3 User Link Cell Isolation
[***]
Table 3-4: User Link Cell Isolation
[***]
3.5.4.4 Service Channel Power Allocation
SS/L- E338831 - Rev. B-7
Exhibit B-2
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SPACE SYSTEMS
- -------------
LORAL 08/21/06
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to the restriction on the title page.
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[***]
3.6 SBN End-to-End System Tests
[***]
3.7 Second SBN Option
[***]
3.8 EXTERNAL INTERFACES
[***]
3.8.1 Network Time and Frequency Standards
[***]
3.8.2 TT&C Interfaces
[***]
SS/L- E338831 - Rev. B-7
Exhibit B-2
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SPACE SYSTEMS 15
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[***]
3.8.3 Interface with S-BSS
[***]
3.8.4 Interface with CRMS
[***]
SS/L- E338831 - Rev. B-7
Exhibit B-2
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SPACE SYSTEMS 16
- -------------
LORAL 08/21/06
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to the restriction on the title page.
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[***]
3.9 Telecom System Interaction
3.9.1 Air Interfaces
[***]
3.9.2 Link Budgets
[***]
3.9.3 Interface with Handheld Mobile Terminal
[***]
SS/L- E338831 - Rev. B-7
Exhibit B-2
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SPACE SYSTEMS 17
- -------------
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3.9.4 SBN Transparency
[***]
3.9.4.1 Forward Link Signal Distortion
[***]
3.9.4.2 Forward Link Relative Signal Power Levels
[***]
3.9.4.3 Return Link Signal Distortion
[***]
3.9.4.4 Return Link Relative Signal Power Levels
[***]
3.9.4.5 End-to-end Latency
[***]
SS/L- E338831 - Rev. B-7
Exhibit B-2
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SPACE SYSTEMS 18
- -------------
LORAL
Use or disclosure of the data contained on this sheet is subject
to the restriction on the title page.
08/21/06
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SS/L- E338831 - Rev. B-7
Exhibit B-2
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SPACE SYSTEMS
- -------------
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08/21/06
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APPENDIX I
----------
Typical Satellite Link Budget
Using GMR-3G
as Mobile Air Interface
QPSK Carrier
Las Vegas Ground Station
SS/L- E338831 - Rev. B-7
Exhibit B-2
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SPACE SYSTEMS 20
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LORAL
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[***]
SS/L- E338831 - Rev. B-7
Exhibit B-2
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SPACE SYSTEMS 21
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[***]
SS/L- E338831 - Rev. B-7
Exhibit B-2
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SPACE SYSTEMS
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08/21/06
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[***]
SS/L- E338831 - Rev. B-7
Exhibit B-2
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SPACE SYSTEMS 23
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TerreStar SBAS- Product Assurance Plan
Satellite-Beam-Access Subsystem
Exhibit C
Product Assurance Program Plan
Revision R0 March 2006
H34726/06-TS-0032-R0
Exhibit C Version H34727
DRAFT-FOR DISCUSSION PURPOSES ONLY
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PROPRIETARY NOTICE
All rights reserved. This publication and its contents are proprietary
to Hughes Network Systems, LLC. No part of this publication may be
reproduced in any form or by any means without the written permission
of Hughes Network Systems, LLC, 11717 Exploration Lane, Germantown,
Maryland 20876.
Hughes is a registered trademark of Hughes Network Systems, LLC.
Copyright (C) 2006 Hughes Network Systems, LLC
ii
HUGHES PROPRIETARY
Exhibit C Version H34727
DRAFT-FOR DISCUSSION PURPOSES ONLY
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REVISION HISTORY
- -----------------------------------------------------------------------
Revision Date of Issue Scope
- -----------------------------------------------------------------------
R0 3/23/06 System Requirement Review
- -----------------------------------------------------------------------
- -----------------------------------------------------------------------
iii
HUGHES PROPRIETARY
Exhibit C Version H34727
DRAFT-FOR DISCUSSION PURPOSES ONLY
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TABLE OF CONTENTS
SECTION AGE
- ------- ---
1.0 PURPOSE AND SCOPE.........................................................1-1
1.1 INTRODUCTION..............................................................1-1
1.2 APPLICABLE DOCUMENTS......................................................1-1
1.3 ACRONYM DEFINITIONS.......................................................1-2
1.4 PRODUCT ASSURANCE OBJECTIVES..............................................1-2
2.0 HUGHES PRODUCT ASSURANCE SYSTEM...........................................2-1
2.1 HUGHES PRODUCT ASSURANCE SYSTEM...........................................2-1
2.2 PLANS.....................................................................2-1
3.0 DESIGN ASSURANCE..........................................................3-1
3.1 ENGINEERING DOCUMENT AND DATA CONTROL.....................................3-1
3.2 MATERIALS/COMPONENT QUALITY ENGINEERING...................................3-1
3.2.1 Component Specs and the Associated Quality Goals........................3-1
3.3 RELIABILITY ANALYSES......................................................3-2
3.4 DESIGN REVIEWS AND INSPECTIONS............................................3-2
3.5 DESIGN VERIFICATION TESTS (DVT)...........................................3-2
3.6 HARDWARE VERIFICATION TESTS (HVT).........................................3-3
3.7 SYSTEM VERIFICATION TESTS (SVTS)..........................................3-3
3.8 HARDWARE DESIGN MARGIN CPK (CPK IS THE PROCESS/PRODUCT
CAPABILITY INDEX) MATRIX..................................................3-3
3.9 CONFIGURATION MANAGEMENT..................................................3-4
3.10 REQUIREMENTS COMPLIANCE ANALYSIS.........................................3-4
4.0 PRODUCTION ASSURANCE......................................................4-1
4.1 FACTORY MANAGEMENT SYSTEM.................................................4-1
4.2 SHIP AUTHORIZATION PROCESS................................................4-2
4.3 PRODUCTION QUALITY AND RELIABILITY METRICS/REPORTS/GOALS..................4-2
4.3.1 Quality Requirements....................................................4-2
4.4 PRODUCTION AUDIT TEST (PAT)...............................................4-2
4.5 ONGOING RELIABILITY TEST (ORT)............................................4-3
4.6 FIELD QUALITY MANAGEMENT..................................................4-3
5.0 FAILURE TRACKING AND NON-CONFORMANCE HANDLING.............................5-1
5.1 BASIC PROVISIONS..........................................................5-1
5.2 FAILURE REPORTING AND TRACKING............................................5-1
5.3 CONTROL OF NON-CONFORMING ITEMS...........................................5-1
6.0 ISO 9000 AUDIT SCHEDULE...................................................6-1
iv
HUGHES PROPRIETARY
Exhibit C Version H34727
DRAFT-FOR DISCUSSION PURPOSES ONLY
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LIST OF TABLES
TABLE PAGE
- ----- ----
4-1. FMS Document List.........................................................4-1
5-1. Failure Reporting and Tracking............................................5-1
v
HUGHES PROPRIETARY
Exhibit C Version H34727
1.0 PURPOSE AND SCOPE
1.1 INTRODUCTION
This document defines the Product Assurance Plan for the TerreStar S-Band
Satellite Beam Access Subsystem (SBAS) project.
Development, production, and delivery of products for the TerreStar SBAS Program
shall be performed in accordance with the Hughes ISO 9001 certified Quality
System.
1.2 APPLICABLE DOCUMENTS
[***]
1-1
HUGHES PROPRIETARY
Exhibit C Version H34727
[***]
1.3 ACRONYM DEFINITIONS
- --------------------------- ----------------------------------------------------
Acronym Definition
- --------------------------- ----------------------------------------------------
CCB Change Control Board
- --------------------------- ----------------------------------------------------
CCR Customer Care Request
- --------------------------- ----------------------------------------------------
CMP Configuration Management Plan
- --------------------------- ----------------------------------------------------
Cpk Process/Product Capability Index
- --------------------------- ----------------------------------------------------
DETS Defect and Enhancement Tracking System
- --------------------------- ----------------------------------------------------
DFMAT Design for Manufacturability and Test
- --------------------------- ----------------------------------------------------
DVT Design Verification Test
- --------------------------- ----------------------------------------------------
ECN Engineering Change Request
- --------------------------- ----------------------------------------------------
ELF Early Life Failure
- --------------------------- ----------------------------------------------------
FMS Factory Management System
- --------------------------- ----------------------------------------------------
FRU Field Replaceable Unit
- --------------------------- ----------------------------------------------------
FTR Failure Trouble Report
- --------------------------- ----------------------------------------------------
GBBF Ground Based Beam Forming
- --------------------------- ----------------------------------------------------
Hughes Hughes Network Systems
- --------------------------- ----------------------------------------------------
HVT Hardware Verification Test
- --------------------------- ----------------------------------------------------
HW Hardware
- --------------------------- ----------------------------------------------------
MQE Materials Quality Engineering
- --------------------------- ----------------------------------------------------
MTBF Mean Time Between Failures
- --------------------------- ----------------------------------------------------
MTBI Mean Time Between Incidents
- --------------------------- ----------------------------------------------------
MTTR Mean Time to Repair
- --------------------------- ----------------------------------------------------
ORT Ongoing Reliability Test
- --------------------------- ----------------------------------------------------
QMS Quality Management System
- --------------------------- ----------------------------------------------------
SBAS Satellite Beam Access Subsystem
- --------------------------- ----------------------------------------------------
SPR System Problem Reports
- --------------------------- ----------------------------------------------------
SVT System Verification Test
- --------------------------- ----------------------------------------------------
SW Software
- --------------------------- ----------------------------------------------------
UUT Unit Under Test
- --------------------------- ----------------------------------------------------
1.4 PRODUCT ASSURANCE OBJECTIVES
[***]
1-2
HUGHES PROPRIETARY
Exhibit C Version H34727
[***]
1-3
HUGHES PROPRIETARY
Exhibit C Version H34727
2.0 HUGHES PRODUCT ASSURANCE SYSTEM
2.1 HUGHES PRODUCT ASSURANCE SYSTEM
[***]
2.2 PLANS
[***]
2-1
HUGHES PROPRIETARY
Exhibit C Version H34727
3.0 DESIGN ASSURANCE
3.1 ENGINEERING DOCUMENT AND DATA CONTROL
[***]
3.2 MATERIALS/COMPONENT QUALITY ENGINEERING
[***]
3.2.1 Component Specs and the Associated Quality Goals
[***]
3-1
HUGHES PROPRIETARY
Exhibit C Version H34727
[***]
3.3 RELIABILITY ANALYSES
[***]
3.4 DESIGN REVIEWS AND INSPECTIONS
[***]
3.5 DESIGN VERIFICATION TESTS (DVT)
[***]
3/2
HUGHES PROPRIETARY
Exhibit C Version H34727
[***]
3.6 HARDWARE VERIFICATION TESTS (HVT)
[***]
3.7 SYSTEM VERIFICATION TESTS (SVTS)
[***]
3.8 HARDWARE DESIGN MARGIN CPK (CPK IS THE PROCESS/PRODUCT CAPABILITY INDEX)
MATRIX
[***]
3-3
HUGHES PROPRIETARY
Exhibit C Version H34727
[***]
3.9 CONFIGURATION MANAGEMENT
[***]
3.10 REQUIREMENTS COMPLIANCE ANALYSIS
[***]
3-4
HUGHES PROPRIETARY
Exhibit C Version H34727
4.0 PRODUCTION ASSURANCE
4.1 FACTORY MANAGEMENT SYSTEM
[***]
-------------------------------------------------------------------------------
Table 4-1. FMS Document List
-------------------------------------------------------------------------------
Document Number Document Title
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
[***] [***]
-------------------------------------------------------------------------------
4-1
HUGHES PROPRIETARY
Exhibit C Version H34727
4.2 SHIP AUTHORIZATION PROCESS
[***]
4.3 PRODUCTION QUALITY AND RELIABILITY METRICS/REPORTS/GOALS
[***]
4.3.1 Quality Requirements
[***]
4.4 PRODUCTION AUDIT TEST (PAT)
[***]
4-2
HUGHES PROPRIETARY
Exhibit C Version H34727
4.5 ONGOING RELIABILITY TEST (ORT)
[***]
4.6 FIELD QUALITY MANAGEMENT
[***]
4-3
HUGHES PROPRIETARY
Exhibit C Version H34727
5.0 FAILURE TRACKING AND NON-CONFORMANCE HANDLING
5.1 BASIC PROVISIONS
[***]
5.2 FAILURE REPORTING AND TRACKING
[***]
- ---------------------------------------------------------------------------------------------------
Table 5-1. Failure Reporting and Tracking
- ---------------------------------------------------------------------------------------------------
Where Detected Reporting and Tracking Mechanisms Process References
- -------------------------------- ------------------------------------------------------------------
[***] [***] [***]
- ---------------------------------------------------------------------------------------------------
[***] [***] [***]
- ---------------------------------------------------------------------------------------------------
[***] [***] [***]
- ---------------------------------------------------------------------------------------------------
[***] [***] [***]
- ---------------------------------------------------------------------------------------------------
5.3 CONTROL OF NON-CONFORMING ITEMS
[***]
5-1
HUGHES PROPRIETARY
Exhibit C Version H34727
6.0 ISO 9000 AUDIT SCHEDULE
[***]
<s>
- -------------------------------------------------------------------------------------------------------------------------------
[***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***] [***]
- -------------------------------------------------------------------------------------------------------------------------------
1 Documentation Doc Manager 2.4.3, 4.1.1 5.1.1.2, 6.1.1.2.1 X
and Data Control 2.4.4 5.1.1.3
- -------------------------------------------------------------------------------------------------------------------------------
2 PreSales - Market Business 3.1.1.1 4.2.5, 5.2.5.1, X
and Service Operation 4.3.4 5.3.4.1
Requirements Management(BOM)
- -------------------------------------------------------------------------------------------------------------------------------
[***] [***] [***] [***] [***] [***] X
[***]
- -------------------------------------------------------------------------------------------------------------------------------
[***] [***] [***] X
- -------------------------------------------------------------------------------------------------------------------------------
4 Contract Review Business 3.1.1.1 4.2.3 5.2.3.1
Management X
Operation (BOM)
- -------------------------------------------------------------------------------------------------------------------------------
[***] [***] [***] [***] [***] [***] [***] X
[***] [***]
- -------------------------------------------------------------------------------------------------------------------------------
[***] [***] [***] [***] [***] 5[***]
- -------------------------------------------------------------------------------------------------------------------------------
[***] [***] [***] [***] [***] [***]
[***]
- -------------------------------------------------------------------------------------------------------------------------------
[***] [***] [***] [***] [***] [***]
[***] [***] X
- -------------------------------------------------------------------------------------------------------------------------------
9 Installation PM and Field 3.1.1.1 4.2.6 5.2.6.9
Services Service Mgmnt
- -------------------------------------------------------------------------------------------------------------------------------
[***] [***] [***] [***] [***] [***] [***] X
[***]
- -------------------------------------------------------------------------------------------------------------------------------
[***] [***] [***] [***] [***] [***] [***]
- -------------------------------------------------------------------------------------------------------------------------------
[***] [***] [***] [***] [***] [***] X
- -------------------------------------------------------------------------------------------------------------------------------
[***] [***] [***] [***] [***] [***] [***]
[***] [***] X
- -------------------------------------------------------------------------------------------------------------------------------
[***] [***] [***] [***] [***] [***]
[***] [***] X
[***]
- -------------------------------------------------------------------------------------------------------------------------------
[***] [***] [***] [***] [***] [***] [***]
- -------------------------------------------------------------------------------------------------------------------------------
[***] [***] [***] [***] [***] [***]
[***]
- -------------------------------------------------------------------------------------------------------------------------------
17 Financial Finance 3.1.1.4
Management and X
Reporting
- -------------------------------------------------------------------------------------------------------------------------------
6-1
HUGHES PROPRIETARY
Exhibit C Version H34727
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TerreStar
Satellite-Beam-Access Subsystem
Exhibit D-1
Program Test Plan
Version 1.0 July 17, 2006
Space Systems/Loral
3825 Fabian Way
Palo Alto, California 94303 _______________________________
TerreStar Networks, Inc.
One Discovery Place
12010 Sunset Hills Road
6th Floor
Reston, Virginia 20190 _______________________________
- --------------------------------------------------------------------------------
This document contains data and information proprietary to Space Systems/Loral,
Inc. and TerreStar Networks Inc. This data is being furnished pursuant to the
provisions of the Contract between TerreStar Networks Inc. and Space
Systems/Loral, Inc. for the TerreStar Satellite Program. Space Systems/Loral,
Inc. and TerreStar Networks Inc. shall have the right to duplicate, use or
disclose the data and information to the extent specified in the Purchase
Contract.
- --------------------------------------------------------------------------------
The data/information contained herein has been reviewed and approved for release
by Space Systems/Loral Export Administration on the basis that this document
contains no export-controlled information.
- --------------------------------------------------------------------------------
Version 1.0
7/17/06
Exhibit D-1
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1/14
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1.0 GBBF Performance Testing in Simulation Environments
1.1 Introduction
The following represents an example performance testing approach for the Ground
Based Beam Forming (GBBF) and the Calibration Earth Stations (CES's) in
simulated environments incorporating ATC interference and calibration errors.
During a system design phase of the satellite ground segment procurement (SGS)
contract, Contractor may propose refinements and alterations to this plan in
consultation with Purchaser. Contractor will define the GBBF performance testing
during the system design phase and the deliverable from this activity shall be a
GBBF Test Plan. The GBBF Test Plan must encompass, at least at a high level, the
performance tests described here. During the system design phase, other tests
may be proposed, as appropriate.
In terms of network topology, the GBBF is sandwiched between the S-BSS and the
Satellite; Calibration Earth Stations (CES's) connect to the far side of the
satellite network, as well as to the GBBF. Therefore, in order to test the GBBF
before the real network is available, an S-BSS Emulator and a Satellite
Simulator (SS) are required. These shall be developed as Deliverable Items under
this Contract. The salient characteristics of the S-BSS Emulator and the SS are
described in the following sections. Figure 1.1 shows the test setup.
Figure 1.1
[***]
Version 1.0
Exhibit D-1
7/17/06
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SPACE SYSTEMS
- -------------
LORAL
Use or disclosure of the data contained on this sheet is subject to the
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Two types of tests shall be performed - Dynamic and Static. These are described
first in Sections 1.2 and 1.3.
The Acceptance Tests described in Section 1.4 will test the GBBF's adaptive mode
performance in the presence of ATC interference; these tests use the Dynamic and
Static tests described in Section 1.2 and 1.3.
1.2 Dynamic Tests
[***]
1.3 Static Tests
[***]
Version 1.0
Exhibit D-1
7/17/06
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SPACE SYSTEMS
- -------------
LORAL
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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1.3.1 Method of plotting Return Service Link Beam Pattern
[***]
1.3.2 Method of plotting Forward Service Link Beam Pattern
[***]
1.4 Adaptive Mode Performance Tests
[***]
Version 1.0
Exhibit D-1
7/17/06
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SPACE SYSTEMS
- -------------
LORAL
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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1.4.1 Test Class I: Basic Beam Forming Without ATC Interference
[***]
1.4.2 Test Class II: Interference Nulling Beam Forming With ATC Interference
[***]
Version 1.0
Exhibit D-1
7/17/06
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SPACE SYSTEMS
- -------------
LORAL
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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2.0 GBBF Emulator Tests
[***]
3.0 GBBF Tests with In-orbit Satellite
[***]
Version 1.0
Exhibit D-1
7/17/06
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SPACE SYSTEMS
- -------------
LORAL
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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4.0 Test Schedule
[***]
Version 1.0
Exhibit D-1
7/17/06
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SPACE SYSTEMS
- -------------
LORAL
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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Appendix GBBF Test.I
Satellite Simulator (SS)
AI.1.0 Objectives
[***]
Version 1.0
Exhibit D-1
7/17/06
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SPACE SYSTEMS
- -------------
LORAL
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restriction on the title page.
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Figure AI.1
AI.2.0 Key Functions
[***]
AI.2.1 Operator Interface
[***]
Version 1.0
Exhibit D-1
7/17/06
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SPACE SYSTEMS
- -------------
LORAL
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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TerreStar Networks
AI.2.2 Return Link Simulation
[***]
Version 1.0
Exhibit D-1
7/17/06
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SPACE SYSTEMS
- -------------
LORAL
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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AI.2.3 Forward Link Simulation
[***]
AI.3.0 Detailed Description of Satellite Simulator
[***]
Version 1.0
Exhibit D-1
7/17/06
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SPACE SYSTEMS
- -------------
LORAL
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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Figure AI.2a Satellite Simulator Functional Block
Diagram: Return Link
[***]
Version 1.0
Exhibit D-1
7/17/06
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SPACE SYSTEMS
- -------------
LORAL
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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Figure AI.2b Satellite Simulator Functional Block
Diagram: Forward Link
[***]
Version 1.0
Exhibit D-1
7/17/06
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- -------------
LORAL
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
SS/L Confidential and Proprietary
Appendix GBBF_Test.II
S-BSS Emulator
[***]
Version 1.0
Exhibit D-2 07/17/06
14/14
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TerreStar
S-Band Space-Based Network
Exhibit D-2
Test Plan (VCRM)
Document No.: SS/L - 338832 - Revision A-3 December 1, 2006
Space Systems/Loral
3825 Fabian Way
Palo Alto, California 94303 _______________________________
TerreStar Networks, Inc.
One Discovery Place
12010 Sunset Hills Road
6th Floor
Reston, Virginia 20190 _______________________________
- --------------------------------------------------------------------------------
This document contains data and information proprietary to Space Systems/Loral,
Inc. and TerreStar Networks Inc. This data is being furnished pursuant to the
provisions of the Contract between TerreStar Networks Inc. and Space
Systems/Loral, Inc. for the TerreStar Satellite Program. Space Systems/Loral,
Inc. and TerreStar Networks Inc. shall have the right to duplicate, use or
disclose the data and information to the extent specified in the Purchase
Contract.
- --------------------------------------------------------------------------------
The data/information contained herein has been reviewed and approved for release
by Space Systems/Loral Export Administration on the basis that this document
contains no export-controlled information.
- --------------------------------------------------------------------------------
Revision A-3
12/01/06
Exhibit D-2
1/37
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SS/L- E33883 - Rev. A-3
Exhibit D-2
ii
12/01/06
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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CONTENTS
Section Page
GLOSSARY.........................................................................................................IV
1 -- SCOPE........................................................................................................1
1.1 OVERVIEW........................................................................................1
2 -- SBN COMPATIBILITY TESTING....................................................................................3
2.1 OVERVIEW........................................................................................3
2.2 COMPATIBILTIY TESTING DESCRIPTION...............................................................3
2.3 COMPATIBILITY FUNCTIONAL TESTING DESCRIPTION....................................................4
2.3.1 Phase One Testing.....................................................................5
2.3.2 Phase Two Testing.....................................................................6
2.3.3 Results of SBN compatibility tests....................................................7
3 -- IN-ORBIT TESTING.............................................................................................9
3.1 IN-ORBIT TESTING OVERVIEW.......................................................................9
3.1.1 In-Orbit testing Description - Phase 1................................................9
3.1.2 In-Orbit testing Description - Phase 2...............................................10
4 -- VERIFICATION MATRIX.........................................................................................11
4.1 VERIFICATION MATRIX OVERVIEW...................................................................11
ILLUSTRATIONS
Figure Page
Figure 1-1: Space Based Network Test Flow.........................................................................2
Figure 2-1: SBN Compatibility Test Set-up.........................................................................4
TABLES
Table Page
Table 4.1: S-Band Space based Network Requirement Verification Matrix............................................11
SS/L- E33883 - Rev. A-3
Exhibit D-2
iii
12/01/06
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restriction on the title page.
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GLOSSARY
ATC Ancillary Terrestrial (network) Component
ATN Ancillary Terrestrial Network
AUC Authentication center
BSC Base Station Controller
BSS Base Station Subsystem (includes BTS and BSC)
BTS Base Transceiver Station
CES Calibration Earth Station
CFE Customer Furnished Equipment
CDMA Code Division Multiple Access
C/I Carrier to Interference Ratio (signal quality indicator)
C/(N+I) Carrier to Noise and Interference Ratio (signal quality
indicator)
C/(No+Io) Carrier to Noise and Interference Density Ratio (signal quality
indicator)
CMS Control & Management System
CONUS Continental United States
CRMS Central Resource Management System
EIRP Equivalent Isotropic Radiated Power
EV-DV Evolution, Data Voice (referred to CDMA system)
GBBF Ground Based Beam Forming or Ground Based Beam Former
GMSC Gateway Mobile Switching Center
GPRS General Packet Radio Service
GSM Global System for Mobile
G/T Gain over Temperature Ratio
IF Intermediate Frequency
IOT In-Orbit Testing
L-CMS Local Control & Management System
LHCP Left Hand Circular Polarization
MSC Mobile Switching Center
MSS Mobile Satellite Services
MT Mobile Terminal
NSS Network and Switching Subsystem
PBS Pointing Beacon Station
PCS Personal Communications Service (cellular service offered in the
1900 MHz band).
SS/L- E33883 - Rev. A-3
Exhibit D-2
iv
12/01/06
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restriction on the title page.
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PDR Preliminary Design Review
PLMN Public Land Mobile Network
PR Puerto Rico
PSA Primary Service Area
PSTN Public Switched Telephone Network
RF Radio Frequency
RHCP Right Hand Circular Polarization
SBAS Satellite Beam Access Subsystem
SBN Space Based Network
S-BSS Satellite adapted Base Station Subsystem
S-MSC Satellite adapted Master Switching Center
SOC Satellite Operations Center
SOW Statement Of Work
SSA Secondary Service Area
TBC To Be Confirmed
TBD To Be Determined
TDMA Time Division Multiple Access
TT&C Telemetry, Tracking and Control
UMTS Universal Mobile Telecommunications System
USVI United States Virgin Islands
WCDMA Wide-band CDMA
SS/L- E33883 - Rev. A-3
Exhibit D-2
v
12/01/06
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restriction on the title page.
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1 -- SCOPE
This document is a verification and test plan for the TerreStar Space Based
Network.
1.1 OVERVIEW
The TerreStar Space Based Network (SBN) is comprised of a TerreStar Satellite,
provided pursuant to the Satellite Contract, and a Satellite Beam Access System
(SBAS). The SBAS comprising of 2 Feeder-link Earth Stations (FES) including:
o Gateway (RF and IF equipment)
o Ground Based Beam Forming (GBBF)
o Control system
o Terrestrial telecom facility
o TT&C interfaces
The GBBF consists of components within a TerreStar Gateway and a number (TBD) of
Calibration Earth Stations (CES). The TerreStar Satellite performance is
verified during development and on orbit as per the Test Plan in Exhibit D to
the Satellite Contract and the associated documents detailing the test
procedures. On the same lines, the SBAS and the GBBF Subsystem performance is
verified per the GBBF in Exhibit D-1 and its associated documents on test
procedures. The verification of the SBN In Orbit Test will closely follow the
Satellite IOT and the SBAS Preliminary Acceptance and will consist of end-to-end
tests intended to verify the SBN functionalities and performance prior to its
commissioning within the TerreStar Hybrid Network. Selected tests conducted
during SBN IOT shall be compared with baseline test results determined during
SBAS Tests.
Figure 1-1 provides an overview of the relationship between the development &
test of the Space Based Network and its components.
This document provides the overall requirements for the SBN Test Plan. Detailed
test procedures for SBN-related tests shall be developed as required by Exhibit
A-2, SBN Statement of Work. These procedures will be cross-referenced to the
corresponding procedures for tests at the SBAS level conducted with the
Satellite Simulator.
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Exhibit D-2
07/26/06
1
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[***]
Figure 1-1: Space Based Network Test Flow
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Exhibit D-2
07/26/06
2
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2 -- SBN COMPATIBILITY TESTING
2.1 OVERVIEW
The TerreStar Space Based Network (SBN) is comprised of a TerreStar Satellite,
provided pursuant to the Satellite Contract, and a Satellite Beam Access System
(SBAS). Compatibility testing of the SBN components, the Satellite and the SBAS,
is designed to retire risk before launch.
The Satellite and SBAS Test Plans include certain level of compatibility testing
between these two sub-systems. The scope of these tests have not yet been fully
defined. Due to the importance of compatibility testing for the end-to-end
performance of the system, this document will capture the objectives of all such
testing. Such testing will demonstrate compatibility and functionality of the
Satellite with the SBAS prior to launch.
2.2 COMPATIBILTIY TESTING DESCRIPTION
[***]
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Exhibit D-2
07/26/06
3
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[***]
Figure 2-1: SBN Compatibility Test Set-up
2.3 COMPATIBILITY FUNCTIONAL TESTING DESCRIPTION
[***]
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Exhibit D-2
07/26/06
4
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[***]
2.3.1 Phase One Testing
[***]
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Exhibit D-2
07/26/06
5
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[***]
2.3.2 Phase Two Testing
[***]
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Exhibit D-2
07/26/06
6
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[***]
2.3.3 Results of SBN compatibility tests
[***]
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Exhibit D-2
07/26/06
7
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Exhibit D-2
07/26/06
8
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EXECUTION COPY
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3 -- IN-ORBIT TESTING
3.1 IN-ORBIT TESTING OVERVIEW
[***]
3.1.1 In-Orbit testing Description - Phase 1
[***]
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Exhibit D-2
07/26/06
9
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[***]
3.1.2 In-Orbit testing Description - Phase 2
[***]
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Exhibit D-2
07/26/06
10
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4 -- VERIFICATION MATRIX
4.1 VERIFICATION MATRIX OVERVIEW
[***]
Table 4.1: S-Band Space based Network Requirement Verification Matrix
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Exhibit D-2
07/26/06
11
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Exhibit D-2
07/26/06
12
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Exhibit D-2
07/26/06
13
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07/26/06
14
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07/26/06
15
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07/26/06
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Satellite-Beam-Access Subsystem
Exhibit E-1
SBAS PAYMENT PLAN
Revision 1.4 December 1, 2006
Space Systems/Loral
3825 Fabian Way
Palo Alto, California 94303 --------------------------------
TerreStar Networks, Inc.
One Discovery Place
12010 Sunset Hills Road
6th Floor
Reston, Virginia 20190 --------------------------------
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This document contains data and information proprietary to Space Systems/Loral,
Inc. and TerreStar Networks Inc. This data is being furnished pursuant to the
provisions of the Contract between TerreStar Networks Inc. and Space
Systems/Loral, Inc. for the TerreStar Satellite Program. Space Systems/Loral,
Inc. and TerreStar Networks Inc. shall have the right to duplicate, use or
disclose the data and information to the extent specified in the Purchase
Contract.
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Revision 1.4
12/01/06
EXECUTION COPY
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TerreStar
Networks
Exhibit E-1
1/4
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SPACE SYSTEMS
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LORAL
EXECUTION COPY
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TerreStar
Networks
1.0 TOTAL PRICE
1.1 PURCHASE PRICE
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Item Description Price
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<c> <c>
1.0 [***]
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2.0 [***]
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3.0 [***]
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4.0 [***]
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5.0 [***]
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6.0 [***]
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7.0 [***]
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8.0 [***]
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9.0 [***]
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10.0 [***]
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11.0 [***]
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12.0 [***]
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SBAS GRAND TOTAL $ 38,139,834
1.2 OPTIONS PRICES
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Item Option Description Price
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1.0 [***] [***]
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2.0 [***] [***]
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3.0 [***] [***]
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4.0 [***] [***]
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Exhibit E-1
Version 1.3
8/04/06
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
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SPACE SYSTEMS
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LORAL
EXECUTION COPY
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TerreStar
Networks
2.0 PAYMENT SCHEDULE FOR TOTAL PRICE
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Milestone Milestone Completion Date Payment
Number Percentage
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1 [***] [***] [***] [***]
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2 [***] [***] [***] [***]
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3 [***] [***] [***] [***]
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4 [***] [***] [***] [***]
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5 [***] [***] [***] [***]
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6 [***] [***] [***] [***]
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7 [***] [***] [***] [***]
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8 [***] [***] [***] [***]
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9 [***] [***] [***] [***]
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10 [***] [***] [***] [***]
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11 [***] [***] [***] [***]
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12 [***] [***] [***] [***]
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13 [***] [***] [***] [***]
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14 [***] [***] [***] [***]
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15 [***] [***] [***] [***]
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16 [***] [***] [***] [***]
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17 [***] [***] [***] [***]
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[***]
Exhibit E-1
Version 1.3
8/04/06
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
[LOGO OMITTED]
SPACE SYSTEMS
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LORAL
EXECUTION COPY
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TerreStar
Networks
Exhibit E-1
Version 1.3
8/04/06
Use or disclosure of the data contained on this sheet is subject to the
restriction on the title page.
[LOGO OMITTED]
SPACE SYSTEMS
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LORAL
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Exhibit E-2
SBN Program Payment Plan and Termination Liability Amount
14-Nov-06
(Dollars in Thousands)
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Milestone Payment Milestone Milestone Cum Milestone Optiont 38.1 Cum Optioni 38.1 Milestone Termination
Number Amount Amount Price Reduction Price Reduction Date***** Liability ****
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SBN 1 [***] [***] [***] [***] [***] [***] [***]
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SBN 2 [***] [***] [***] [***] [***] [***] [***]
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SBN 3 [***] [***] [***] [***] [***] [***] [***]
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SBN 4 [***] [***] [***] [***] [***] [***] [***]
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SBN 5 [***] [***] [***] [***] [***] [***] [***]
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SBN 6 [***] [***] [***] [***] [***] [***] [***]
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SBN 7 [***] [***] [***] [***] [***] [***] [***]
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SBN 8 [***] [***] [***] [***] [***] [***] [***]
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SBN 9 [***] [***] [***] [***] [***] [***] [***]
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[***] [***] [***] [***] [***] [***] [***]
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* = Subject to Article 33.1, this payment is eliminated if the SBN Price
Reduction Option is exercised with respect to the Third Spacecraft. This payment
is deferred until [***], if Purchaser extends the SBN Payment Reduction Option
pursuant to Article 33.1.7.
** = Subject to Article 9.1.4 and Article 33.1, this amount is reduced by [***]%
($[***] maximum reduction) if the SBN Price Reduction Option is exercised with
respect to either the Third Spacecraft or Fourth Spacecraft (but not both), and
is reduced by [***]% ($[***] maximum reduction) if the SBN Price Reduction
Option is exercised with respect to both the Third and Fourth Spacecraft. In
addition, $1,500 of the SBN 9 payment is not due and payable, if at all, until
the later to occur of: (i) Completion of SBN Acceptance Test; or (ii) [***]. The
remaining $[***]is deferred until [***], if Purchaser extends the SBN Payment
Reduction Option pursuant to Article 33.1.7.
*** = Subject to Article 33.1, this payment is eliminated if the SBN Price
Reduction Option is exercised with respect to the Fourth Spacecraft.
**** = Termination Liability is subject to Article 33.1.7. Maximum Termination
Liability shall not exceed the SBN Firm Fixed Price less the SBN Price Reduction
Amount associated with the actual exercise of the SBN Price Reduction Option
with respect to either or both (as applicable) the Third and Fourth Spacecraft.
The actual amount payable as termination liability is the amount of the
applicable Termination Liability less all amounts previously paid by Purchaser
under this Exhibit E-2.
***** = In the case of Time Payments (SBN 2, SBN 4, SBN 7and SBN 9) Milestone
Date means the last business day of the applicable month.
Space System/Loral Proprietary
Illustration of Election of Spacecraft 3 Only
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Milestone Number Payment Milestone Third Cum Milestone Approximate Date
Spacecraft Mileston Date
Option Only Amount
Milestone
Amount
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SBN 1 [***] [***] [***] [***]
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SBN 2 [***] [***] [***] [***] [***]
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SBN 3 [***] [***] [***] [***] [***]
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SBN 4 [***] [***] [***] [***] [***]
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SBN 5 [***] [***] [***] [***] [***]
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SBN 6 [***] [***] [***] [***] [***]
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SBN 7 [***] [***] [***] [***] [***]
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SBN 8 [***] [***] [***] [***] [***]
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SBN 9 [***] [***] [***] [***] [***]
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SBN 10(a) [***] [***] [***] [***] [***]
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SBN 10(b) [***] [***] [***] [***] [***]
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Illustration of Election of Spacecraft 3 and 4
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Milestone Number Payment Milestone Milestone Cum Milestone Approximate Date
Amount Milestone Date
Amount
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SBN 1 [***] [***] [***] [***] [***]
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SBN 2 [***] [***] [***] [***] [***]
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SBN 3 [***] [***] [***] [***] [***]
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SBN 4 [***] [***] [***] [***] [***]
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SBN 5 [***] [***] [***] [***] [***]
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SBN 6 [***] [***] [***] [***] [***]
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SBN 7 [***] [***] [***] [***] [***]
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SBN 8 [***] [***] [***] [***] [***]
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SBN 9 [***] [***] [***] [***] [***]
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SBN 10 [***] [***] [***] [***] [***]
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[***] [***] [***] [***] [***]
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Illustration of Election of Spacecraft 4 Only
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Milestone Number Payment Milestone Milestone Cum Milestone Approximate Date
Amount Milestone Date
Amount
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SBN 1 [***] [***] [***] [***] [***]
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SBN 2 [***] [***] [***] [***] [***]
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SBN 3 [***] [***] [***] [***] [***]
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SBN 4 [***] [***] [***] [***] [***]
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SBN 5 [***] [***] [***] [***] [***]
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SBN 6 [***] [***] [***] [***] [***]
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SBN 7 [***] [***] [***] [***] [***]
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SBN 8 [***] [***] [***] [***] [***]
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SBN 9 [***] [***] [***] [***] [***]
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SBN 10 [***] [***] [***] [***] [***]
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SBN 10 [***] [***] [***] [***] [***]
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[***] [***] [***] [***] [***]
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