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EXHIBIT 10.2
December 19, 1997
International Satellite Communication Holding Limited
Xxxxxxx Xxxxxx 000
0000 Xxxxxx Xxxxx
Xxxxxxxxx
Attention: Xx. Xxxxx Xxxxxxxxxx
Re: Full-Time Transponder Lease Agreement
Gentlemen:
This letter agreement (the "Agreement") is made by and between PanAmSat
International Systems, Inc. ("PanAmSat") and International Satellite
Communication Holding Limited ("Customer"). This Agreement sets forth the terms
and conditions under which PanAmSat agrees to provide, and Customer agrees to
accept, up to [ ]* MHz of C-band transponder capacity from the Americas Beam of
that certain Atlantic Ocean Region satellite referred to by PanAmSat as "PAS-5."
In consideration of the foregoing and of the mutual promises set forth below,
PanAmSat and Customer mutually agree as follows:
1. The Service. PanAmSat agrees to provide, and Customer agrees to accept,
"Service" meeting the "Service Specifications" attached hereto as Appendix B,
according to the ramp-up schedule set forth in Appendix A. The initial
Transponder assignment shall be Transponder #[ ]*.
2. Interim Service. The parties agree that Customer shall be entitled to
utilize [ ]* [ ]* MHz of capacity on the Pan America Beam of the "PAS-3"
satellite (the "PAS-3 Capacity"), in lieu of [ ]* MHz of Customer's allocated
capacity on the PAS-5 satellite. Customer shall be entitled to utilize the PAS-3
Capacity until the earlier of: (i) such time as PanAmSat obtains regulatory
approval to commercialize C-band capacity from the PAS-5 satellite in Argentina,
or (ii) the date that PanAmSat notifies Customer that the PAS-3 Capacity will no
longer be available for use by Customer, such notice to be provided no less than
sixty (60) days in advance, provided that PanAmSat will not give Customer such
notice earlier than January 1, 1998, or (iii) the date that Customer notifies
PanAmSat of its intention to transition services to Customer's allocated
capacity on PAS-5, such notice to be provided no less than thirty (30) days in
advance (in any case, the "End Date"). Upon the End Date, Customer shall have
fifteen (15) to transition its services from the PAS-3 satellite to the PAS-5
satellite. In the event of a failure of the PAS-3 Capacity, Customer shall be
entitled to Outage Credits in accordance with the terms of the "Transponder
Service Agreement," as defined below, pro rated on a per MHz basis. Any failure
of the PAS-3 Capacity shall not count
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* CONFIDENTIAL TREATMENT REQUEST -- Confidential portion has been omitted and
filed separately with the Commission.
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as a failure for purposes of determining whether or not there has been a failure
on a "Confirmed Basis," as defined in the Transponder Service Agreement. The
initial Transponder assignment for the PAS-3 Capacity shall be Transponder
#[ ]*.
The parties may agree, in writing, to increase the amount of PAS-3
Capacity provided to Customer in lieu of Customer's allocated capacity on PAS-5.
In such event, the PAS-3 Capacity shall be provided in accordance with a set of
revised specifications which PanAmSat shall provide to Customer upon executing
an amendment to such effect.
3. Service Date, Term. The "Service Term" of this Agreement shall commence
on November 1, 1997 (the "Service Date"), and shall continue in effect until the
ten (10) year anniversary of the Service Date.
4. Service Fee. For each month of the Service Term, beginning on the
Service Date, Customer agrees to pay the monthly fee set forth in Appendix A
hereto (the "Service Fee"). Customer shall deposit with PanAmSat the amount of
US$[ ]* on or before the execution of this Agreement (the "Deposit"), and this
Deposit shall be applied to the Service Fee for the last month of the Service
Term. Customer shall make each and all other payments of the Service Fee, in
advance, no later than the first business day of each month of the Service Term.
5. Taxes. Customer is solely responsible for any taxes, charges (including
universal service fund contribution changes, if any), levies, duties,
withholding, or usage fees (collectively "Taxes") which may be asserted by any
local, state, or national government entity with respect to this Agreement, the
Service, or the Service Fees, with the exception of any U.S. income taxes on
PanAmSat. If any Taxes are asserted with respect to the Satellite itself, the
frequencies employed, or for the point of space that it occupies and are not
specifically applicable or attributable to particular transponders or payments
made with respect to its use, then Customer shall be responsible for a
proportionate amount, calculated as the total number of Transponders (or portion
thereof) that are leased hereunder divided by the total number of Transponders
on the Satellite.
6. Taking the Satellite Out of Commercial Operation. PanAmSat may
determine to take the Satellite out of commercial operation: (a) if, in
PanAmSat's judgment, the remaining fuel on board the Satellite is no longer
sufficient to maintain geosynchronous orbit within plus or minus 0.05 degrees,
allowing sufficient fuel for de-orbiting the Satellite, or (b) one half or more
of the Transponders that constitute either the C-band or Ku-band payload of the
Satellite no longer meet their applicable performance specifications; provided
that, for purposes of applying this provision to the Ku-band payload of PAS-5
each high-powered Ku-band Transponder (110 xxxxx) shall be weighted as twice the
value of each low-powered Ku-band Transponder (60 xxxxx), or, (c) at any time
after October 11, 2012 (the "Design Date"). In such event, PanAmSat shall
promptly notify Customer of such determination and of the date the Satellite
will be
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* CONFIDENTIAL TREATMENT REQUEST -- Confidential portion has been omitted and
filed separately with the Commission.
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taken out of commercial operation. On the date that the Satellite is taken out
of commercial operation, this Agreement shall automatically terminate.
7. Right to Deny Access.
(a) PanAmSat may deny access by Customer to the Service Transponder
in any circumstance in which PanAmSat would have the right to terminate this
Agreement for cause under Section 7.5 of the Transponder Service Agreement,
referenced below, provided that any notice that would be required for
termination under Section 7.5 is also given for any such denial access.
(b) PanAmSat may also deny access to Customer if, in any
circumstance that arises out of Customer's use of the Service, PanAmSat or any
member of the "PanAmSat Group" (as defined in Section 9.3 of the Transponder
Service Agreement): (A) is indicted, (B) is otherwise charged as a criminal
defendant, (C) becomes the subject of any criminal proceeding, or (D) becomes
the subject of any other governmental action or threat of any action by any
governmental entity or representative thereof which potentially could result in
the revocation, suspension, or loss of any license, ability or right to provide
capacity or service to any customer or loss of any customer's right or ability
to use the capacity or service provided to it. PanAmSat may also deny access to
Customer if Customer's signal is being "jammed" by a third party (governmental
or otherwise) and such jamming is interfering with the use or threatens the
health of the Satellite; provided that PanAmSat shall, in cooperation with
Customer, use all reasonable efforts through all available legal avenues to
cause such jamming to be stopped as soon as possible; provided that nothing
herein shall be construed so as to require either party to institute legal
proceedings against any third party.
(c) Customer shall cease transmissions to the Satellite upon notice
of denial of access by PanAmSat under this Section. PanAmSat may continue to
deny Customer access under this Section until any breach of the Agreement by
Customer is cured and, in the case of any denial of access pursuant to clause
(b) above, until any action or threat of action is resolved in PanAmSat's favor
or removed and, in each case, until assurances are given to PanAmSat's
reasonable satisfaction that the matter(s) giving rise to a denial of access
will not reoccur.
(d) If it is determined by final judicial order that PanAmSat
prevented Customer from accessing any or all of Service at a time when PanAmSat
did not have the right to do so under this Section, then Customer shall be
entitled to Outage Credits for the period during which access was denied, which
shall be calculated in accordance with Section 5.2 of the Transponder Service
Agreement. Except as provided in the preceding sentence, a denial of access made
by PanAmSat under this Section shall not result in any Outage Credit to Customer
for Service Fee payments, which shall continue to be due and payable.
8. Orbital Location. PanAmSat constructs, launches, and operates its
satellites under the authority of the United States Federal Communications
Commission
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("FCC"). PanAmSat has been authorized by the FCC to construct, launch and
operate the Satellite in geostationary orbit at 58 degrees West Longitude (the
"Planned Orbital Location). PanAmSat shall use such orbital location (or, to the
extent that PanAmSat obtains FCC authority to do so, any location within five
degrees of the Planned Orbital Location), unless prevented by subsequent order
of the FCC, in which event PanAmSat shall use such orbital position closest to
the range identified above that the FCC may designate. Until the Design Date,
PanAmSat shall use all reasonable efforts to resist any move of the Satellite
from outside the orbital range specified above; thereafter, PanAmSat may
relocate the Satellite to any orbital location. In the event that PanAmSat
changes the Satellite's orbital location, such changes shall not affect the
continuing validity of this Agreement, except to the extent such change prevents
PanAmSat from providing Service that meets the Service Specifications, in which
event the termination provision set forth in Article 7 of the Transponder
Service Agreement shall apply.
9. Subordination. Customer acknowledges and agrees that if PanAmSat uses a
Xxxxxx Secured Transponder as a Service Transponder, the subordination provision
set forth in Appendix E shall apply to this Agreement. Customer acknowledges and
agrees that PanAmSat may grant security interests in the Transponders and/or the
Satellite to other parties, subject to the secured party's agreement to grant
quiet enjoyment in accordance with provisions that are substantially similar to
those set forth in Appendix E.
10. Terms and Conditions Incorporated by Reference. The following terms
and conditions set forth in that certain Full-Time Transponder Service Agreement
for Data Service Delivery (Pre-Launch) (the "Transponder Service Agreement"),
entered into on the 18th day of August, 1994, as amended, are incorporated by
reference and made applicable, in context, to this Agreement, except insofar as
such provision may be in conflict with the terms and conditions expressly stated
above, in which case the terms and conditions of this Agreement shall govern:
Sections 1.3 (Usage), 1.4 (Transmission Plan), 3.3 (Manner of Payment), 3.4
(Late Payment), Article 4 (Customer's Obligations in Using the Service), Article
5 (Outages), Article 6 (Preemptive Rights), Article 7 (Termination) (except
Section 7.4), Article 8 (Force Majeure), Article 9 (Limitation of Liability and
Indemnification), Article 10 (except Sections 10.2 and 10.2A shall apply only to
the PAS-3 Capacity), Article 11, Article 12, Section 13.1 (as to the PAS-3
Capacity only), Sections 13.2 and 13.3, and Article 14. References in the
Transponder Service Agreement to Appendix B (Description of Satellite) and
Appendix C (Service Specifications) shall, in the context of the PAS-5 Service
be deemed to be references to Appendix B-1, and in the context of the PAS-3
Capacity, be deemed to be references to Appendix B-2, attached hereto.
References in the Transponder Service Agreement to Appendix D (Operational
Requirements) shall be deemed to be references to Appendix C hereto.
Notwithstanding anything to the contrary in Section 12.3(b) of the Transponder
Service Agreement, the Service may be used for U.S. domestic communications.
11. Attachments. This Agreement shall also include the following appendix
attached hereto:
Appendix A: Payment Schedule for I.S.C.H.
Appendix B: Service Specifications for PAS-5 AOR C-band
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Americas Beam Transponders ([ ]* and [ ]* MHz
Allocation)
Appendix B-2: Service Specifications for PAS-3 AOR C-band
Pan America Beam Transponders ([ ]* MHz Allocation)
Appendix C: Operational Requirements
Appendix D: Reserved
Appendix E: Subordination to Xxxxxx Aircraft Company
Each of the parties has duly executed and delivered this Agreement as of
the day and year first written above.
PANAMSAT INTERNATIONAL SYSTEMS INC.
By: ----------------------------------------------
Name:
--------------------------------------------
Title:
-------------------------------------------
INTERNATIONAL SATELLITE
COMMUNICATION HOLDING LIMITED
By: /s/ X. Xxxxxxxxx /s/ K. Kindle
----------------------------------------------
Name: X. Xxxxxxxxx K. Kindle
-------------------------------------------
Title:
-------------------------------------------
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* CONFIDENTIAL TREATMENT REQUEST -- Confidential portion has been omitted and
filed separately with the Commission.
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APPENDIX A
PAYMENT SCHEDULE FOR
INTERNATIONAL SATELLITE COMMUNICATION HOLDING LIMITED
Total Downlink
Start Date Satellite* Band MHz Beam Monthly Lease Fee
---------- --------- ---- --- -------- -----------------
November 1, 0000 XXX-0 X [ ]* Americas US$[ ]*
January 1, 0000 XXX-0 X [ ]* Americas US$[ ]*
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* CONFIDENTIAL TREATMENT REQUEST -- Confidential portion has been omitted and
filed separately with the Commission.
* As stated in Section 2, Customer shall be entitled to utilize 12 MHz of
capacity from the Pan America Beam of the PAS-3 satellite in lieu of an
equivalent amount of PAS-5 capacity, until the "End Date," as defined in Section
2.
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APPENDIX B
PERFORMANCE SPECIFICATIONS FOR
PAS-[ ]* AOR C-BAND
AMERICAS BEAM TRANSPONDERS
([ ]* MHz and [ ]* MHz Allocations)
[
]*
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* CONFIDENTIAL TREATMENT REQUEST -- Confidential portion has been omitted and
filed separately with the Commission.
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APPENDIX C
EARTH STATION AND OPERATIONAL REQUIREMENTS
FOR ANALOG AND DIGITAL SERVICES
VIA PAS-5 C-BAND AND KU-BAND TRANSPONDERS
1.0 INTRODUCTION
This Appendix contains the earth station requirements and associated operational
procedures for transmission via C-bank and Ku-band transponders on the PAS-5
satellite.
2.0 EARTH STATION REQUIREMENTS
The earth stations used by Customer to transmit analog or digital carriers in C
or Ku-Band transponders must meet the requirements listed in Section 2.0, 3.0,
and 4.0.
2.1 Earth Station EIRP
For full transponder ([ ]*MHz) operations, Customer earth stations must be
capable of transmitting a modulated carrier with a maximum EIRP sufficient to
achieve the nominal satellite SFD given in Appendix B with a margin of at least
[ ]*dB. For partial transponder allocations and services, the actual assigned
operating EIRP for a given earth station will be determined by PanAmSat in
consultation with Customer, taking into account the actual transponder
performance and loading prior to the time of the transmission.
2.2 EIRP Stability
The EIRP in the direction of the PAS-5 satellite must, under clear sky
condition, be maintained to within +/-[ ]* dB of the assigned operating EIRP
(upon agreement of all users within a multi-carrier transponder and approval of
PanAmSat, additional EIRP variation may be permitted). Under no circumstances
may the EIRP exceed the assigned value by more than [ ]* dB.
2.3 Earth Station Transmit Gain Requirement
The gain of the transmit antenna must be sufficient to yield the maximum EIRP,
as defined in SFD given in Appendix B with a margin of at least [ ]* dB (note
1). For partial transponder Section 2.1. If antenna size resulting from above
requirement is excessive, PanAmSat may reduce requirement provided that adjacent
satellite flux density limits are maintained. The uplink power of TV carriers,
as measured at the
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* CONFIDENTIAL TREATMENT REQUEST -- Confidential portion has been omitted and
filed separately with the Commission.
1
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transmit earth station antenna feed, shall not exceed TBD Xxxxx for the full
power TV/FM carriers at Ku-bank and TBD Xxxxx for full power TV/FM carriers at
C-band.
2.4 HPA Requirement
In determining the HPA size for a given earth station, it is necessary not only
for Customer's transmitting earth station to meet the maximum EIRP requirements,
but also to meet the emission constraints set forth in Section 3.4 and 4.2.
2.5 Antenna Sidelobes
All earth stations shall satisfy the following transmit sidelobe performance
envelopes:
G < = 00 - 00 xxx00((xxxxx)) xXx 0(xxxxxxx)x (xxxxx) = 7(degrees)
G < = 8 dBi, 7(degrees)< (theta) < = 9.2(degrees)
G < = 00 - 00 xxx00 ((xxxxx)) xXx 0.0(xxxxxxx)x (xxxxx) < = 48(degrees)
G < = -10 dBi, (theta) > 48(degrees)
Where G is the gain of the sidelobe envelope, relative to an isotropic antenna,
in the direction of the geostationary orbit and 8 is the angle in degrees
between the main beam axis and the direction considered. For 8 greater than 7
degrees, the envelope may be exceeded by 10% of the sidelobes, but no individual
sidelobe may exceed the envelope by more than 3 dB.
The receive sidelobes must also conform to the envelope described above to
guarantee compliance with the adjacent satellite interference specification
contained in Appendix B.
2.6 Transmit Earth Station Polarization
Earth stations used for PAS-5 C and Ku-bank transmissions must be linearly
polarized on both the uplink and downlink (except for circularly polarized feeds
for the high Power Ku-band downlink). Specific uplink and downlink polarizations
are determined by transponder assignments and are further specified in Appendix
B. The earth station cross-polarization isolation must be a minimum of 30 dB
within the main beam of the earth station's transmit antenna pattern.
3.0 VIDEO SERVICE REQUIREMENTS
3.1 Video Exciter Requirements
Customer may use any video exciter which meets the minimum requirements listed
in Sections 3.3 through 3.5
3.2 RF Bandwidth
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The RF bandwidth must be 18 MHz or less for dual video carriers transmitted
simultaneously within a 36 MHz transponder. Other bandwidth restrictions may be
imposed in shared transponder operation where more than two carriers are in
simultaneous use. Where the Customer has full use of the Transponder (36 MHz)
any RF bandwidth may be chosen.
3.3. IF Transmit Filter
An IF filter must be provided in the transmit path for each TV/FM carrier in
order to reduce video color crosstalk and to minimize adjacent transponder
interference. The specific filter used for this purpose must be approved by
PanAmSat in consultation with the Customer in consideration of the specific
loading of the transponder.
The group delay response characteristics of the filter, while not specified by
PanAmSat, should take into consideration both the total group delay of the
Satellite Transponder (as specified in the attached Appendix B) as well as the
group delay produced by the transmit earth station IF and RF equipment.
3.4. Emission Constraints
The transmit earth station must be equipped and operated in such a manner that
spurious emission at the output of the antenna due to all sources does not
exceed 4 dBW/4 kHz outside of the assigned carrier bandwidth.
3.5. Energy Dispersal
A low-frequency symmetrical triangular energy dispersal waveform must be added
to the baseband signal prior to the FM modulator. A video signal must be present
at all times and the peak-to-peak deviation of the energy dispersal modulation
must be TBD MHz when video is present.
3.6 Carrier Frequency Assignments
The uplink carrier frequency for video transmission within a transponder or
allocation is assigned by PanAmSat based on coordination agreements reached by
PanAmSat with other networks. Earth stations must be capable of operating at any
frequency within the Transponder. For analog video transmission, frequencies
will be assigned to the nearest 0.250 MHz. It is recommended that all transmit
earth stations further be capable of operation across the entire satellite
uplink frequency band.
3.7 Audio and Data Subcarriers
Customer may add one or more audio or data subcarriers to the normal video
baseband, provided that: (1) the EIRP of the composite carrier does not exceed
the value specified in Appendix B; and (2) the emission constraints set forth in
Section 3.4 are met.
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4.0 DATA SERVICE REQUIREMENTS
4.1 Modem Requirements
The Customer may use any digital, SCPC/PSK,, MCPC/PSK satellite modem that meets
their particular requirements, subject to the following constraints which are
designed to ensure excess interference is not experienced by adjacent satellites
or by other users of PAS-5:
a) Digital Modems -- Scrambling must be provided to ensure that uniform
spectral spreading is applied to the transmitted carrier at all times. A data
scrambler built in accordance with CCITT Rec. V.35, or a functionally
equivalent unit with similar spectrum spreading characteristics, must be
employed.
b) SCPC and MCPC/PSK -- In general, any SCPC or MCPC/PSK modem which meets
all relevant CCIR and CCITT recommendations is allowed, subject to prior
approval by PanAmSat.
c) Other Modems -- The use of other modem types is subject to approval by
PanAmSat.
4.2 Emission Constraints
The transmit earth station must be equipped and operated in such a manner that
spurious emission at the output of the antenna due to all sources does not
exceed 4 dBW/4 kHz outside of the assigned transponder bandwidth.
The EIRP density of each carrier, outside the bandwidth allocation of the
transponder or partial transponder, which results from spectral regrowth due to
earth station non-linearities shall be at least 26 dB below the main carrier
spectral density, and shall not exceed 4 dBW in any 4 kHz band within the C- and
Ku-band frequency range of the satellite.
4.3 Carrier Frequency Assignments
The assigned center frequency of each carrier will be determined by PanAmSat in
consultation with the Customer. It may on occasion be necessary to change
carrier frequency assignments, either to meet unforeseen changes in the
Customer's requirements or to avoid mutual interference with carriers in
adjacent or co-frequency transponders.
Transmitting earth stations must be capable of operating at any assigned
frequency within the Transponder or allocation. For digital data transmission,
frequencies will be assigned to the nearest 0.025 MHz. It is recommended that
all transmit earth stations further be capable of operation across the entire
satellite uplink frequency band.
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Unless specifically approved by PanAmSat, the aggregate allocated bandwidth of
carriers within a multi-carrier transponder or allocation should not exceed 90%
of the total available bandwidth in order to provide flexibility in carrier
assignments and to reduce the effects of intermodulation noise, adjacent carrier
interference, co-channel interference, and adjacent satellite interference.
5.0 UPLINK REQUIREMENTS
5.1 Uplink Requirements
Before a transmit station may access a PAS-5 Transponder for video or data
transmission, it must demonstrate compliance with the technical requirements set
forth in Sections 2.0, 3.0, and 4.0, and with PanAmSat Access Requirements for
transmission to PAS-5, to be provided by PanAmSat to the Customer and as
PanAmSat may modify from time to time.
5.2 Uplink Restrictions
Except as may be permitted by PanAmSat during a coordinated test period, no
earth station operator shall transmit an unmodulated carrier through a
Transponder. The operation of each earth station must be in strict adherence
with a transmission plan submitted by the Customer and approved by PanAmSat.
Under no circumstances shall the earth station transmit an RF carrier to PAS-5
on a frequency not authorized by PanAmSat, whether or not that frequency is in
use by other stations.
6.0 ADDITIONAL CONTRACTUAL REQUIREMENTS WITH RESPECT TO THE UPLINK
6.1 Non-interference Restrictions
Customer's radio transmissions to and from the Satellite shall comply with all
applicable governmental laws, rules and regulations. Customer will follow
established practices and procedures for frequency coordination and will not use
the transponder, or any portion thereof, in a manner which would or might under
standard engineering practice, interfere with the use of any other Transponder,
the Satellite, or any other satellite or transponder on such satellite, or cause
physical harm to the Service Transponder, any other Transponder, the Satellite,
or any other in-orbit satellite or transponder on such satellite.
6.2 Customer's Transmitting Stations
Customer will configure, equip and operate its transmit facilities so that the
interface of these facilities, in space, with the Satellite shall conform to the
characteristics and technical parameters of the Satellite. Customer will follow
PanAmSat's procedures for initiating or terminating any transmission into the
Satellite. Customer will operate all transmit facilities in a manner that allows
for cessation of, and will cease transmission
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immediately upon receiving telephone or telecopy notice from PanAmSat. Customer
will furnish information on a continuing basis as required by PanAmSat to
prepare for, initiate, provide, maintain and immediately discontinue the use of
the Service upon notice by PanAmSat.
PanAmSat shall have the right, but not the obligation, to inspect any Customer
transmit facilities, together with associated facilities and equipment. PanAmSat
will use its reasonable best efforts to schedule such inspections to minimize
the disruption of the operation of such facilities, and Customer shall make such
facilities available for inspection at all reasonable times. Customer shall,
upon PanAmSat's request, provide a measured proof that any such Customer
transmit facility meets or exceeds the side envelope described in Section 2.5,
above.
6.3 Interference and Preemption Notices
Customer shall maintain, at each Customer transmit facility, and shall provide
PanAmSat with a telephone number that is continuously staffed, at all times
during which customer is transmitting or receiving signals to or from the
Satellite, and an automatic telecopy number that shall be maintained in
operation and capable of receiving messages from PanAmSat, at all times. Said
telephone and telecopy shall be maintained for the purpose of receiving notices
from PanAmSat regarding interference or other problems arising out of the
provision of Service on, or customer's or any Assignee's use of the Service
Transponder, including, without limitation, any decision by PanAmSat to preempt
or interrupt Service to Customer pursuant to the Agreement. It is mandatory that
the person who receives such messages has the technical capability and absolute
authority to immediately terminate or modify the transmission if notified by
PanAmSat pursuant to the foregoing. All such notices shall be effective upon the
placement of the telephone call or transmission of a telecopier message by
PanAmSat to Customer. If, for any reason, Customer's telephone is not answered
and its telecopier is incapable of receiving transmission, PanAmSat's notice
shall be deemed to have occurred at the time it attempts to place a telephone
call or transmit a telecopier message to Customer. PanAmSat shall promptly
confirm telephone notices in writing.
End of Appendix C
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APPENDIX E
SUBORDINATION TO XXXXXX AIRCRAFT COMPANY
Subordination. Customer hereby acknowledges that this Agreement and all
rights granted to Customer hereunder are subject and subordinate to a security
interest and lien in favor of Xxxxxx Aircraft Company, as same may be assigned
(the "Interest") in and to Transponder 8C (and/or the proceeds from the sale or
other disposition of all or any portion thereof, or any insurance that may be
received by PanAmSat International Systems, Inc. as a result of any loss or
destruction of, or damage to, the Transponder identified above) and to all
renewals, modifications, consolidations, replacements and extensions of any
security agreement, mortgage or other document reflecting any such Interest
arising under that certain Satellite Purchase Contract Security Agreement (the
"Xxxxxx Security Agreement") by and between PanAmSat International Systems, Inc.
and Xxxxxx Aircraft Company; provided, that, the holder of such Interest agrees
that, so long as (i) Customer is not in default under the terms and conditions
of this Agreement, as to which any applicable cure period stated in this
Agreement has expired, (ii) Customer shall not pay any of its obligations under
this Agreement (other than a deposit of no more than two (2) months) more than
thirty (30) days prior their scheduled payment date under this Agreement, (iii)
after receipt of notice from the holder of the Interest of a default by PanAmSat
International Systems, Inc. under the agreement providing for the Interest, this
Agreement shall not be supplemented, amended or extended (except by its terms
with respect to specified extension periods) or otherwise modified in any
manner, (iv) after receipt of notice from a holder of the Interest, and (v) this
Appendix E is not amended; Customer shall continue to have the benefits of this
Agreement notwithstanding any default on the part of PanAmSat International
Systems, Inc. under the agreement providing for such Interest. This clause shall
be self-operative and no further document reflecting such Interest to make this
subordination effective. In confirmation of such acknowledged subordination,
Customer shall execute promptly any instrument or certificate which PanAmSat
International Systems, Inc. or the holder of such an Interest may reasonably
request.
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