TNAG-2857-FCO40-4110-Satellite-Licensing-and-Asia-Satellite-Telecommunications-Co-1993 — Page 16

14+40 Jent of UK DIONATOKT-INTELSAT

INTELSAT RES

RESTRICTED

Contribution of the

INTELSAT Management

BG 96-54E (Rev. 1) W/3/93 23 March 1993

SIGNATORY LIABILITY

EXECUTIVE SUMMARY

1. INTELSAT Management proposes that the Board of Governors adopt a number of changes in INTELSAT's policy concerning Signatory liability for utilization charges incurred by entities authorized by the Signatory to

Signatory to access the INTELSAT system and for the operation of earth stations by such authorized entities. These changes would represent an option available to Signatories. They are optional, not mandatory.

Further, in order to protect INTELSAT's financial security as more and more non-Signatory users access the system, the INTELSAT Management proposes changes in INTELSAT'S policy concerning sanctions for non-payment of utilization charges and a new policy regarding creditworthiness of authorized entities.

RECOMMENDATION

2.

INTELSAT Management recommends that the Board DECIDE to:

(a) (i) Refrain from holding

from holding the liable for payment of

(b)

authorizing Signatory utilization charges

attributable to entities authorized by the Signatory to access the INTELSAT space segment if so requested by the Signatory.

(ii) Authorize INTELSAT Management to examine the creditworthiness of authorized entities and impose any requirements for ensuring timely payment by the authorized entity as it deems appropriate;

(iii) Impose the automatic sanction of denying additional service to any user which has not paid its utilization charges within 30 days after the due date for payment;

(iv) Suspend all service to a user which has not paid its utilization charges within 150 days after the due date for payment, unless INTELSAT Management determines that exceptional circumstances exist.

(v) Implement the provisions of subparagraph (iii) and (iv) above beginning with respect to the billing for the second quarter 1993 services.

Refrain from holding the authorizing Signatory liable for damage resulting

resulting from the authorized entity's mis-