Explanatory Statement

0485-EX-ST-2007 Text Documents

HNS License Sub, LLC

2007-09-24ELS_84737

                                                                   Hughes Communications, Inc.
                                                        Request for Special Temporary Authority



                               EXPLANATORY STATEMENT


        Hughes Communications, Inc. (“HCI”) and its indirect subsidiaries, HNS License
Sub., LLC and HNS License Sub, Ltd. (together, the “HNS Licensees”), seek via this
application special temporary authority (“STA”) to continue to operate with BRH
Holdings GP, Ltd. (“BRH”)1 as the controlling entity of HCI and the HNS Licensees. As
described fully in the underlying applications for transfer of control of space, earth, and
Experimental Radio Service licenses and authorizations that HCI and the Hughes
Licensees filed earlier this week, HCI and HCI’s regulatory counsel learned on August
23, 2007 that a reorganization of the ownership structure of the Apollo investment funds
(“Apollo Reorganization”) had resulted in control of HCI and the HNS Licensees being
transferred from Apollo Capital Management IV, Inc. and AIF IV Management, Inc. to
BRH as of July 13, 2007.2 Applications seeking consent of the Federal Communications
Commission for the transfer of control of HCI and the HNS Licensees are now pending
before the Commission’s International Bureau and Office of Engineering & Technology.3

        HCI understands that the Communications Act and the Commission’s rules
require prior Commission consent to any transfer of control of a Commission Title III
authorization. As such consent was not obtained before the transfer of control of HCI and
its subsidiaries was consummated, HCI and the HNS Licensees are hereby requesting
STA to permit these entities to continue operating under their current ownership and
control structure pending final action on the underlying transfer of control applications.

       FCC grant of an STA will serve the public interest, convenience, and necessity by
maintaining the status quo and permitting continued operation of the various satellite and
space station facilities licensed to HCI and the HNS Licensees. These facilities provide,

1
       As explained in Exhibit E&F to the transfer applications, BRH is controlled by Apollo principals
       Leon Black, Marc Rowan, and Joshua Harris (with Leon Black having certain veto rights).
2
       As soon as HCI was able to ascertain the facts relating to the Apollo Reorganization, HCI
       prepared and filed a letter apprising the Commission of the transfer of control, and indicating that
       the applications necessary to obtain the requisite Commission consent would be submitted as soon
       as was practicable. See Letter from Raul R. Rodriguez and Stephen D. Baruch, Counsel to HCI,
       to Marlene H. Dortch, Secretary, FCC, dated August 30, 2007.
3
       HCI is the applicant for authority to transfer control of the SPACEWAY 3 space station in FCC
       File No. SAT-T/C-20070904-00119. This request also seeks STA for temporary operation
       consistent with the three Earth station transfer applications filed by HNS License Sub., LLC (FCC
       File Nos. SES-T/C-20070905-01228, -01229, and -01230) and one Earth station application filed
       by HNS License Sub., Ltd. (FCC File No. SES-T/C-20070905-01231). HNS License Sub, LLC
       has also applied to the Office of Engineering & Technology for authority to transfer control of
       several Experimental Radio Service authorizations that it holds. See FCC File No. 0023-EX-TU-
       2007. Exhibit E&F from the transfer applications is included as an Attachment to this request.


                                                            Hughes Communications, Inc.
                                                 Request for Special Temporary Authority


or will provide, needed data transmission services for a variety of major clients, including
Lowe’s, Kmart, Walgreen’s and Rite Aid, and hundreds of thousands of users nationwide.
Moreover, HCI’s newly-launched SPACEWAY 3 satellite is currently undergoing delicate
orbit-raising maneuvers on its way to its permanent home at 94.95º W.L., where it will
begin providing much anticipated and needed Ka-band FSS services early next year. HCI
and the HNS Licensees need to be in constant communication with the satellite during
these maneuvers.

       Given the circumstances described, HCI and the HNS Licensees request
expedited consideration of this STA. As the applications for transfer of control are now
pending, a 60-day STA is requested. See 47 C.F.R. § 25.120(b)(3). HCI and the HNS
Licensees understand that grant of STA would be without prejudice to whatever actions
may be taken in connection with the underlying transfer of control applications.


                                                                                   FCC Form 312
                                                                                   Exhibits E & F
                                                                                     Page 1 of 10

                                     Exhibits E & F
                         Response to Questions 43, A.20 and A.21
       Description of Transaction/Public Interest Statement/Ownership and Control

        The instant application is one of six contemporaneously filed applications
(“Applications”) that together seek consent of the Federal Communications Commission (“FCC”
or “Commission”) to a transfer of control of Hughes Communications, Inc. (“HCI”) and two of
HCI’s indirect subsidiaries – HNS License Sub, Limited and HNS License Sub, LLC (together,
the “HNS Licensees”) – from Apollo Capital Management IV, Inc. and AIF IV Management, Inc.
(together, “Apollo IV”) to BRH Holdings GP, Ltd. (“BRH Holdings”) pursuant to a
reorganization (“Apollo Reorganization”) of Apollo IV, together with its affiliated investment
management entities (“Apollo”). HCI is the holder of a non-common carrier satellite space
station authorization for the SPACEWAY 3 satellite. The HNS Licensees are the holders of
several non-common carrier earth station authorizations and Experimental Radio Service
authorizations used in connection with the business of providing VSAT services and
manufacturing communications equipment.

        Apollo is a global alternative asset manager, with a proven track record of successful
private equity, distressed debt and mezzanine investing. The Apollo Reorganization was
effectuated pursuant to a three-step transaction, the final step of which was consummated on
August 8, 2007. In the second step of this transaction, which was consummated on July 13,
2007, control of HCI and the HNS Licensees was transferred from Apollo IV, which was
controlled by Leon Black, to BRH Holdings, which is controlled equally by Leon Black, Marc
Rowan, and Joshua Harris (with Leon Black having certain veto rights, as explained below).
Like Apollo founder Mr. Black, Messrs. Rowan and Harris are co-founders and long-time
principals of Apollo.

        Prior to the Apollo Reorganization, HCI was controlled by five entities affiliated with
Apollo (the “Apollo Stockholders”). Leon Black was the sole shareholder of Apollo IV, which
indirectly controlled the Apollo Stockholders. The Apollo Stockholders held approximately 63%
of the stock of Hughes at the time Apollo IV acquired control of Hughes in early 2006. The
organizational structure of Apollo’s ownership in HCI, as approved by the Commission pursuant
to an assignment of license application (File No. SAT-ASG-20050826-00168) that was
consummated on February 21, 2006, is depicted in Attachment 2 to this Exhibit.

        Pursuant to the Apollo Reorganization, a series of intermediate entities has been inserted
into the chain of ownership. In addition, pursuant to the Apollo Reorganization, control of HCI
and the HNS Licensees has been transferred from Apollo IV to BRH Holdings. Apollo’s control
of BRH Holdings is now exercised equally by Apollo principals Leon Black, Marc Rowan, and
Joshua Harris. However, Leon Black has the right to veto certain major decisions relating to
Apollo, such as the appointment of any director to the board of directors of Apollo. The
organizational structure of Apollo’s ownership in HCI following the Apollo Reorganization is
depicted in Attachment 3 to this Exhibit.

      HCI and HCI’s regulatory counsel learned of the Apollo Reorganization for the first time
on August 23, 2007. HCI understands that the Communications Act and the Commission’s rules


                                                                                  FCC Form 312
                                                                                  Exhibits E & F
                                                                                    Page 2 of 10

require prior Commission consent to any transfer of control of a Commission Title III
authorization. HCI acknowledges that such prior consent was not obtained before the transfer of
control of HCI described herein was consummated. As soon as HCI was able to ascertain the
facts relating to the Apollo Reorganization, HCI prepared and filed a letter (a copy of which is
appended hereto as Attachment 1) apprising the Commission of the transfer of control, and
indicating that the applications necessary to obtain the requisite Commission consent would be
submitted as soon as was practicable. Accordingly, HCI is promptly filing the Applications in
order to seek the requisite FCC consent.

       FCC approval of the Applications will serve the public interest, convenience, and
necessity because the Apollo Reorganization enhances the flexibility of the capital structure of
Apollo, and thus, of HCI and the HNS Licensees. Approval will also ensure that the ownership
of HCI and the HNS Licensees will be accurately reflected in the Commission’s records.

       Further information about the ownership of HNS License Sub, LLC and HNS License
Sub, Limited is set forth below.

I.     HNS License Sub, LLC

       Address:              HNS License Sub, LLC
                             11717 Exploration Lane
                             Germantown, Maryland 20876
       Citizenship:          Delaware
       Primary Business:     Holding licenses

       HNS License Sub, LLC is a wholly owned subsidiary of Hughes Network Systems, LLC.

I.     HNS License Sub, Limited

       Address:              HNS License Sub, Limited
                             Sunrise Parkway
                             Linford Wood
                             Milton Keynes MK 14 6LS
                             United Kingdom
       Citizenship:          United Kingdom
       Primary Business:     Holding licenses

        HNS License Sub, Limited is a wholly owned subsidiary of Hughes Network Systems,
Ltd., a U.K. general partnership company. Hughes Network Systems, Ltd. is a wholly owned
subsidiary of Hughes Network Systems Europe, Ltd., a U.K. holding company. Hughes Network
Systems Europe, Ltd. is a wholly owned subsidiary of Hughes Network Systems, LLC.


                                                                                     FCC Form 312
                                                                                     Exhibits E & F
                                                                                       Page 3 of 10

II.      Hughes Network Systems, LLC

         Address:                Hughes Network Systems, LLC
                                 11717 Exploration Lane
                                 Germantown, Maryland 20876
         Citizenship:            Delaware
         Primary Business:       Providing VSAT services

     Hughes Network Systems, LLC is a wholly owned subsidiary of Hughes
Communications, Inc.

III.     Hughes Communications, Inc.

         Address:                Hughes Communications, Inc.
                                 11717 Exploration Lane
                                 Germantown, Maryland 20876

         Citizenship:            Delaware
         Primary Business:       Hughes Communications, Inc. is responsible for the management,
                                 operation, and control of the business and affairs of Hughes
                                 Network Systems, LLC.

         The equity and voting interests in Hughes Communications, Inc. are described below.

         A.       Equity interests in Hughes Communications, Inc.1

        The Apollo Stockholders are Apollo Investment Fund IV, L.P., Apollo Overseas Partners
IV, L.P., AP/RM Acquisition LLC, AIF IV/RRRR LLC, and ST/RRRR LLC. The Apollo
Stockholders collectively hold a direct equity interest of at least 64.9 % in HCI. The remaining
equity interests are widely-distributed among HCI’s other stockholders. No other entity or
individual would hold a direct or indirect equity interest in HCI of 10% or more.

       The names, addresses, citizenship, primary business and equity interest in HCI of each of
the Apollo Stockholders is as follows:

Apollo Investment Fund IV, L.P.
       Address:                                        Two Manhattanville Road
                                                       Purchase, NY 10577
         Citizenship:                                  Delaware
         Primary Business:                             Investment in securities
         Equity interest in HCI:                       53.1%

         1
             Equity interests in Hughes Communications, Inc. have been calculated on a fully diluted
basis.


                                                                                  FCC Form 312
                                                                                  Exhibits E & F
                                                                                    Page 4 of 10


Apollo Overseas Partners IV, L.P.
       Address:                                     c/o Walkers SPV Limited
                                                    PO Box 908GT
                                                    Walker House
                                                    Mary Street
                                                    George Town, Grand Cayman
                                                    Cayman Islands BWI
       Citizenship:                                 Cayman Islands
       Primary Business:                            Investment in securities
       Equity interest in HCI:                      2.7%

AP/RM Acquisition LLC
     Address:                                       Two Manhattanville Road
                                                    Purchase, NY 10577
       Citizenship:                                 Delaware
       Primary Business:                            Investment in HCI
       Equity interest in HCI:                      2.2%

AIF IV/RRRR LLC
       Address:                                     Two Manhattanville Road
                                                    Purchase, NY 10577
       Citizenship:                                 Delaware
       Primary Business:                            Investment in HCI
       Equity interest in HCI:                      4.1%

ST/RRRR LLC
      Address:                                      Two Manhattanville Road
                                                    Purchase, NY 10577
       Citizenship:                                 Delaware
       Primary Business:                            Investment in HCI
       Equity interest in HCI:                      2.8%

       B. Voting interests in Hughes Communications, Inc.

        The Apollo Stockholders hold 64.9% of the voting interests in HCI. The remaining
voting interests are widely distributed among HCI’s other stockholders, with no single such
stockholder holding a voting interest of 10% or greater in HCI.

       As described in greater detail below, the Apollo Stockholders’ voting interests in HCI are
ultimately, indirectly controlled by principals of Apollo through a series of intermediate
subsidiaries and management arrangements:


                                                                                   FCC Form 312
                                                                                   Exhibits E & F
                                                                                     Page 5 of 10

               1. Intermediate Subsidiaries

Apollo Advisors IV, L.P.
       Address:                       9 West 57th Street
                                      43rd Floor
                                      New York, NY 10019
       Citizenship:                   Delaware
       Primary Business:              General partner of Apollo Investment Fund IV, L.P. and
                                      Apollo Overseas Partners IV, L.P.

         Apollo Advisors IV, L.P. is the general partner of Apollo Investment Fund IV, L.P. and the
managing general partner of Apollo Overseas Partners IV, L.P. In that capacity, the management,
operation and control of Apollo Investment Fund IV, L.P. and Apollo Overseas Partners IV, L.P.,
including control over the voting and disposition of their interests in HCI, is vested exclusively
in Apollo Advisors IV, L.P. As further described in Section III.B.2 below, Apollo Advisors IV,
L.P. has delegated this authority, pursuant to a management agreement, to Apollo Management
IV, L.P.

Apollo Capital Management IV, Inc.
       Address:                    9 West 57th Street
                                   43rd Floor
                                   New York, NY 10019
       Citizenship:                Delaware
       Primary Business:           General partner of Apollo Advisors IV, L.P.

        Apollo Capital Management IV, Inc. is the general partner of Apollo Advisors IV, L.P.,
and in that capacity has complete and exclusive responsibility for all management decisions to be
made on behalf of Apollo Advisors IV, L.P. and for the conduct of the business and affairs of
Apollo Advisors IV, L.P.

Apollo Principal Holdings I, L.P.
       Address:                       9 West 57th Street
                                      43rd Floor
                                      New York, NY 10019
       Citizenship:                   Delaware
       Primary Business:              Sole shareholder of Apollo Capital Management IV, Inc.

        Apollo Principal Holdings I, L.P. is the sole shareholder of Apollo Capital Management
IV, Inc., and in that capacity has complete and exclusive responsibility for all management
decisions to be made on behalf of Apollo Capital Management IV, Inc., and for the conduct of
the business and affairs of Apollo Capital Management IV, Inc.


                                                                                 FCC Form 312
                                                                                 Exhibits E & F
                                                                                   Page 6 of 10



Apollo Principal Holdings I GP, LLC
       Address:                     9 West 57th Street
                                    43rd Floor
                                    New York, NY 10019
       Citizenship:                 Delaware
       Primary Business:            General partner of Apollo Principal Holdings I, L.P.

         Apollo Principal Holdings I GP, LLC is the general partner of Apollo Principal Holdings
I, L.P., and in that capacity has complete and exclusive responsibility for all management
decisions to be made on behalf of Apollo Principal Holdings I, L.P., and for the conduct of the
business and affairs of Apollo Principal Holdings I, L.P. Apollo Principal Holdings I GP, LLC is
managed by a Board of Managers comprised of Apollo principals Leon Black, Marc Rowan, and
Joshua Harris. Such Board of Managers generally has the sole right to manage the business of
Apollo Principal Holdings I GP, LLC.

APO Asset Co. LLC
      Address:                       9 West 57th Street
                                     43rd Floor
                                     New York, NY 10019
       Citizenship:                  Delaware
       Primary Business:             Sole member of Apollo Principal Holdings I GP, LLC

       APO Asset Co. LLC is the sole member of Apollo Principal Holdings I GP, LLC.

Apollo Global Management, LLC
       Address:                      9 West 57th Street
                                     43rd Floor
                                     New York, NY 10019
       Citizenship:                  Delaware
       Primary Business:             Sole member of APO Asset Co. LLC

        Apollo Global Management LLC is the sole member of APO Asset Co. LLC, and in that
capacity has complete and exclusive responsibility for all management decisions to be made on
behalf of APO Asset Co. LLC, and for the conduct of the business and affairs of APO Asset Co.
LLC. As further described in Section III.B.2 below, BRH Holdings GP, Ltd., the controlling
member of Apollo Global Management, LLC, has delegated the management, operation and
control of Apollo Global Management, LLC to AGM Management, LLC.


                                                                               FCC Form 312
                                                                               Exhibits E & F
                                                                                 Page 7 of 10

BRH Holdings GP, Ltd.
     Address:                       9 West 57th Street
                                    43rd Floor
                                    New York, NY 10019
       Citizenship:                 Cayman Islands
       Primary Business:            Controlling member of Apollo Global Management, LLC

       BRH Holdings GP, Ltd. holds approximately 87% of the voting membership interests of,
and thus is the controlling member of, Apollo Global Management, LLC. In that capacity, the
management, operation and control of Apollo Global Management, LLC is vested in BRH
Holdings GP, Ltd.

        Apollo principals Leon Black, Marc Rowan, and Joshua Harris are the sole stockholders
and directors of BRH Holdings GP, Ltd. Information about Mr. Black, Mr. Rowan, and Mr.
Harris is as follows:

Leon Black
      Address:                      9 West 57th Street
                                    43rd Floor
                                    New York, NY 10019
       Citizenship:                 U.S.
       Primary Business:            Investment Management

Marc Rowan
      Address:                      9 West 57th Street
                                    43rd Floor
                                    New York, NY 10019
       Citizenship:                 U.S.
       Primary Business:            Investment Management

Joshua Harris
       Address:                     9 West 57th Street
                                    43rd Floor
                                    New York, NY 10019
       Citizenship:                 U.S.
       Primary Business:            Investment Management

              2. Management Arrangements

Apollo Management IV, L.P.
       Address:                     9 West 57th Street
                                    43rd Floor
                                    New York, NY 10019
              Citizenship:          Delaware
              Primary Business:     Management of the Apollo Stockholders


                                                                                     FCC Form 312
                                                                                     Exhibits E & F
                                                                                       Page 8 of 10


        By the terms of (i) the organizational documents of AP/RM Acquisition, LLC, AIF
IV/RRRR LLC, and ST/RRRR LLC appointing Apollo Management IV, L.P. as manager of
those entities and (ii) separate management agreements through which Apollo Advisors IV, L.P.
has delegated to Apollo Management IV, L.P. management, operation and control of Apollo
Investment Fund IV, L.P. and Apollo Overseas Partners IV, L.P., Apollo Management IV, L.P., a
Delaware limited partnership, is the manager of each of the Apollo Stockholders and, in such
capacity, has full authority to act on behalf of and to bind the Apollo Stockholders in all respects,
including, without limitation, the authority to negotiate, complete, execute and deliver any and
all agreements, deeds, instruments, receipts, certificates and other documents on behalf of the
Apollo Stockholders, and to take all such other actions on behalf of the Apollo Stockholders as
Apollo Management IV, L.P. may consider necessary or advisable in connection with the
management of the Apollo Stockholders.

Apollo Management, L.P.
       Address:                9 West 57th Street
                               43rd Floor
                               New York, NY 10019
       Citizenship:            Delaware
       Primary Business:       General partner of Apollo Management IV, L.P.

        Apollo Management, L.P. is the general partner of Apollo Management IV, L.P., and in
that capacity has complete and exclusive responsibility for all management decisions to be made
on behalf of Apollo Management IV, L.P. and for the conduct of the business and affairs of
Apollo Management IV, L.P., including all such decisions and all such business and affairs to be
made or conducted by Apollo Management IV, L.P. in its capacity as manager of the Apollo
Stockholders.

Apollo Management GP, LLC
       Address:           9 West 57th Street
                          43rd Floor
                          New York, NY 10019
       Citizenship:       Delaware
       Primary Business:  General partner of Apollo Management, L.P.

        Apollo Management GP, LLC is the general partner of Apollo Management, L.P., and in
that capacity has complete and exclusive responsibility for all management decisions to be made
on behalf of Apollo Management, L.P. and for the conduct of the business and affairs of Apollo
Management, L.P.


                                                                                  FCC Form 312
                                                                                  Exhibits E & F
                                                                                    Page 9 of 10

Apollo Management Holdings, L.P.
       Address:           9 West 57th Street
                          43rd Floor
                          New York, NY 10019
       Citizenship:       Delaware
       Primary Business:  Sole member and manager of Apollo Management GP, LLC

      Apollo Management Holdings, L.P. is the sole member and manager of Apollo
Management GP, LLC, and in that capacity has complete and exclusive responsibility for all
management decisions to be made on behalf of Apollo Management GP, LLC and for the
conduct of the business and affairs of Apollo Management GP, LLC.

Apollo Management Holdings GP, LLC
       Address:           9 West 57th Street
                          43rd Floor
                          New York, NY 10019
       Citizenship:       Delaware
       Primary Business:  Sole member of Apollo Management Holdings, L.P.

       Apollo Management Holdings GP, LLC is the general partner of Apollo Management
Holdings, L.P., and in that capacity has complete and exclusive responsibility for all management
decisions to be made on behalf of Apollo Management Holdings, L.P. and for the conduct of the
business and affairs of Apollo Management Holdings, L.P. Apollo Management Holdings GP,
LLC is managed by a Board of Managers comprised of Apollo principals Leon Black, Marc
Rowan, and Joshua Harris. Such Board of Managers generally has the sole right to manage the
business of Apollo Management Holdings GP, LLC.

APO Corp.
     Address:                9 West 57th Street
                             43rd Floor
                             New York, NY 10019
       Citizenship:          Delaware
       Primary Business:     Sole member of Apollo Management Holdings GP, LLC

       APO Corp. is the sole member of Apollo Management Holdings GP, LLC.

       The sole member of APO Corp. is Apollo Global Management, LLC. Information
regarding the ownership of Apollo Global Management, LLC is set forth in Section III.B.I above.
APO Corp. is managed by a Board of Directors comprised of Leon Black, Marc Rowan, and
Joshua Harris. Such Board of Directors generally has the sole right to manage the business of
APO Corp.

       BRH Holdings GP, Ltd. has delegated the management, operation and control of Apollo
Global Management, LLC to AGM Management, LLC, a Delaware limited liability company. In
such capacity, AGM Management, LLC has full authority to act on behalf of and to bind Apollo


                                                                               FCC Form 312
                                                                               Exhibits E & F
                                                                                Page 10 of 10

Global Management, LLC in all respects, including, without limitation, the authority to
negotiate, complete, execute and deliver any and all agreements, deeds, instruments, receipts,
certificates and other documents on behalf of the Apollo Global Management, LLC, and to take
all such other actions on behalf of Apollo Global Management, LLC as AGM Management, LLC
may consider necessary or advisable in connection with the management of Apollo Global
Management, LLC.

         BRH Holdings GP, Ltd., the controlling member of Apollo Global Management, LLC,
also is the sole member of AGM Management, LLC. Information regarding the ownership of
BRH Holdings GP, Ltd. is set forth in Section III.B.I above.


ATTACHMENT 1


                                                 @
                         LEVENTHAL SENTER & LERMAN PLLC

                                          August 30, 2007




BY HAND DELIVERY:
Marlene H. Dortch
Secretary
Federal Communications Commission
445 12"" Street, SW
Washington, D.C. 20554

                      Re: Transfer of Control of Hughes Communications, Inc.

Dear Ms. Dortch:

       By this letter, Hughes Communications, Inc. ("Hughes"), indirect parent corporation of
HNS License Sub, LLC ("HNS Sub LLC") and HNS License Sub, Limited ("HNS Sub Limited"
and, together with HNS Sub LLC, the "HNS Licensees"), hereby informs the Commission that
control of the Hughes companies was transferred without prior Commission approval as
explained herein. Hughes holds non—common carrier Title III space station authorizations for
the SPACEWAY 3 satellite; HNS Sub LLC and HNS Sub Limited hold numerous non—common
carrier earth station licenses and authorizations, and HNS Sub LLC also holds authorizations in
the Experimental Radio Service.

        Following a transaction that was approved by the Commission in 2005, and
consummated in February 2006 (see, e.g., File No. SAT—ASG—20050826—00168), Hughes and its
subsidiaries were indirectly controlled by Apollo Capital Management IV, Inc. and AIF IV
Management, Inc. (together, "Apollo IV"). Leon Black was the sole shareholder of Apollo IV,
which indirectly controlled five entities affiliated with Apollo (the "Apollo Stockholders"). The
Apollo Stockholders held approximately 63% of the stock of Hughes at the time Apollo IV
acquired control of Hughes in early 2006. Apollo IV, together with its affiliated investment
management entities ("Apollo"), is a global alternative asset manager, with a proven track record
of successful private equity, distressed debt and mezzanine investing.

        Late last week, Hughes‘s corporate officers and outside regulatory counsel were informed
by counsel for Apollo that a newly—completed corporate restructuring at the upper levels of the
Hughes ownership chain was effectuated pursuant to a three—step reorganization of Apollo, the
final step of which was consummated on August 8, 2007. In the second step of this
reorganization, which was consummated on July 13, 2007, control of Hughes and the HNS
Licensees was transferred from Apollo IV, which was controlled by Leon Black, to BRH
Holdings, which is controlled equally by Leon Black, Marc Rowan, and Joshua Harris (with Mr.
Black having certain veto rights, as explained below). Like Apollo founder Mr. Black, Messrs.
Rowan and Harris are co—founders and long—time principals of Apollo.



                          2000 K STREET, NW, SUITE 600, WASHINGTON, DC 20006—1809
                        TELEPHONE 202.429—8970   FAX 202.293.7783   WWWLSL—LAW.COM


                                               @
Marlene H. Dortch
August 30, 2007
Page 2

        Specifically, pursuant to the Apollo reorganization, a series of intermediate entities has
been inserted into the chain of ownership of Apollo IV. In addition, pursuant to the Apollo
reorganization, control of Hughes and the HNS Licensees has been transferred from Apollo IV to
BRH Holdings. Apollo principals Leon Black, Marc Rowan, and Joshua Harris are the directors
of BRH, and Apollo‘s control of BRH Holdings is now exercised equally by Messrs. Black,
Rowan, and Harris. However, Mr. Black has the right to veto certain major decisions relating to
Apollo, such as the appointment of any director to the board of directors of Apollo.

        At no time prior to Thursday afternoon of last week (August 23, 2007) was Hughes or
any of its corporate officers aware that changes taking place at the top of the complex Apollo
ownership chain amounted to a transfer of control under Commission regulations and the
Communications Act. The matter apparently came to light within the Apollo group following an
ownership review that resulted from an unrelated proposal for the assignment of authorizations
held by a company in which the Apollo group of companies holds a minority stake, and counsel
for Apollo brought the matter to Hughes‘s attention on August 23.

        Hughes, its corporate officers, and outside regulatory counsel undertook an immediate
investigation of the facts involved. By the end of the day on Friday, August 24, although not all
of the details were yet known, Hughes was convinced that control had been prematurely
transferred, and ordered the preparation of appropriate documentation to align, formally, control
as it now exists with the Commission‘s records. Details of the restructuring transactions and the
timing of the transfer of control were assembled and provided to Hughes and its outside
regulatory counsel on Wednesday, August 29. Requests for transfer of control and temporary
authority related thereto are being prepared and will be filed with the Commission as soon as is
practicable.

        Hughes understands that the Communications Act and the Commission‘s rules require
prior Commission consent to any transfer of control of a Commission Title III authorization.
Hughes acknowledges that such prior consent was not obtained before the transfer of control of
Hughes was consummated. By this letter, Hughes is formally apprising the Commission and
responsible staff of the circumstances of the change in its control, as expeditiously as possible,
even as it prepares the documentation that will bring its licenses into alignment with its
ownership chain.

       Hughes regrets that it failed to follow the Commission‘s regulations and the
Communications Act itself in connection with the transfer of control described herein. By
copying this letter to the staff members listed below, Hughes is promptly apprising Commission
personnel of this development and of the steps Hughes is taking to obtain the required
Commission consent.


                                               @
Marlene H. Dortch
August 30, 2007
Page 3

        Hughes asks that a copy of this letter be placed in the license, authorization, and/or
application files of each station listed on the attachment hereto.

                                              Respectfully submitted,


                                                           yBBA_
                                              Raul R!Rodriguez
                                              Stephen D. Baruch
                                              Attorneys for Hughes Communications, Inc and its
                                              subsidiaries

cc (by email): Ms. Helen Domenici, Chief, International Bureau, FCC
               Mr. Julius Knapp, Chief, Office of Engineering and Technology, FCC
               Mr. Robert Nelson, Chief, Satellite Division, IB
               Ms. Andrea Kelly, Chief, Policy Branch, IB
               Mr. Scott Kotler, Chief, System Analysis Branch, IB
               Mr. James Burtle, Chief, Experimental Licensing Branch, OET


                                                                                                                       ATTACHMENT

                                                  SATELLITE AUTHORIZATIONS
File Number                           Applicant Name              Call Sign                      Location
SAT—LOA—20050214—00038, as modified   Hughes Communications, Inc. S$2663 (SPACEWAY 3)            94.95W
by SAT—MOD—20050523—00106, as
amended by SAT—AMD—20060306—
00025, and further modified by SAT—
MOD—20060901—00093.
SAT—STA—20070720—00106                Hughes Communications, Inc.           $2663 (SPACEWAY 3)   94.95WV


                                                 EARTH STATION AUTHORIZATIONS
File Number                                         Applicant Name          Call Sign                  Location
SES—MFS—20070419—00489                               HNS   License   Sub,   LLC        E000166         Germantown, MD
SES—STA—20070724—00980                               HNS   License   Sub,   LLC        E000166         Germantown, MD
SES—MOD—20040805—01106                               HNS   License   Sub,   Limited    E000362         Kailua—Kona, HI
SES—LIC—20010625—01298, as amended by SES—AMD—       HNS   License   Sub,   Limited    E010187         San Juan, PR
20010712—01299
SES—MOD—20040805—01103                               HNS License Sub, Limited          E020195         Fairbanks, AK
SES—MOD—20040805—01107                               HNS License Sub, Limited          E020205         Kodiak, AK
SES—MOD—20040805—01108                               HNS License Sub, Limited          E020206         Sand Point, AK
SES—MOD—20040805—01105                               HNS License Sub, Limited          E020207         Ejelson AFB, AK
SES—MOD—20040805—01104                               HNS License Sub, Limited          E020208         Agana, Guam
SES—LIC—20040927—01461                               HNS License Sub, Limited          E040382        Wake Island
SES—LIC—20041111—01674                               HNS License Sub, Limited          E040436         Wahiawa, HI
SES—LIC—20061017—01852 as amended by SES—AMD—        HNS License Sub, LLC              EO60382         Castle Rock, CO
20061 103—01954 and SES—AMD—20070207—00204
SES—STA—20070709—00908                               HNS License Sub, LLC              E060382         Castle Rock, CO
SES—LIC—20061017—01869, as amended by SES—AMD—       HNS License Sub, LLC              E060383         Fillmore, CA
20061103—01952 and SES—AMD—20070207—00203
SES—STA—20070709—00909                               HNS License Sub, LLC              E060383         Fillmore, CA
SES—LIC—20061226—02232, as amended by SES—AMD—       HNS License Sub, LLC              E060445         Germantown, MD
20070124—00137
SES—LIC—20070709—00913, as amended by SES—AMD—       HNS License Sub, Limited          E070110         Midway Island
20070730—01004
SES—MOD—20070409—00463                               HNS License Sub, LLC              E940460         North Las Vegas, NV
SES—MOD—20030725—01030                               HNS License Sub, LLC              E990170         Southfield, MI


                                                                                                    ATTACHMENT



                                        EXPERIMENTAL AUTHORIZATIONS
File Number              Applicant Name                Call Sign    Location
0088—EX—RR—2006          HNS License Sub, LLC          wWD2XFP      Germantown, MD; North Las Vegas, NV

0089—EX—RR—2006          HNS License Sub, LLC          WD2XJU       San Diego, CA
0011—EX—PL—2006          HNS License Sub, LLC          WE2XEW       N/A
0110—EX—RR—2007          HNS License Sub, LLC          WD2XRV       Germantown, MD




                                             PENDING APPLICATIONS
File Number              Applicant Name                Call Sign    Location
SES—STA—20070829—01149   HNS License Sub, LLC          E000166      Germantown, MD (STA extension request)
SAT—STA—20070830—00118   Hughes Communications, Inc.   $2663        STA Request for SPACEWAY 3 IOT


ATTACHMENT 2


                                 Ownership of HCI Prior to Apollo Reorganization

                                                                    Apollo Principal
                                                                      Leon Black




                                         Sole Shareholder                              Sole Shareholder



                Apollo Capital                                                                         AIF IV
              Management IV, Inc.                                                                  Management, Inc.




                         GP                                                                                     GP


                                                    Manager Pursuant to Management Agreement
             Apollo Advisors IV, L.P.                                                            Apollo Management IV, L.P.




        GP                          GP                                       Manager                             Manager         Manager



Apollo Investment               Apollo Overseas                        AP/RM
                                                                                                          AIF IV/RRRR LLC            ST/RRRR LLC
  Fund IV, L.P.                 Partners IV, L.P.                   Acquisition LLC

                51.8%                           2.6%                                                  4.0%                    2.7%
                                                                              2.1%


                                                              Hughes Communications, Inc.


ATTACHMENT 3


                                                            Apollo Principals Leon Black,
    Ownership of HCI                                        Marc Rowan, Joshua Harris
    Following Apollo                            Shareholders and Directors

     Reorganization                                            BRH Holdings GP, Ltd.            Sole Member

                                                         Controlling Member
                                                                                                Manager
                                                                                                                          AGM Management, LLC
                                                          Apollo Global Management, LLC
                             Sole Member
                                                                              Sole Member                APO Corp.
                APO Asset Co. LLC
                                                                                                                     Sole Member
                         Sole Member                                                             Apollo Management
                                                                                                  Holdings GP, LLC
                Apollo Principal
               Holdings I GP, LLC                                                                                    GP
                                                                                                 Apollo Management
                          GP                                                                       Holdings, L.P.
                 Apollo Principal                                                                                    Sole Member
                 Holdings I, L.P.
                                                                                                 Apollo Management
                         Sole Shareholder                                                              GP, LLC
                Apollo Capital                                                                                       GP
              Management IV, Inc.                                                                     Apollo
                                                                                                  Management, L.P.
                          GP
                                                                                                                     GP
                                                    Manager Pursuant to Management Agreement
             Apollo Advisors IV, L.P.                                                          Apollo Management IV, L.P.



        GP                          GP                                        Manager                        Manager               Manager


Apollo Investment               Apollo Overseas                         AP/RM
                                                                                                   AIF IV/RRRR LLC                     ST/RRRR LLC
  Fund IV, L.P.                 Partners IV, L.P.                    Acquisition LLC

                53.1%                          2.7%                              2.2%             4.1%                          2.8%


                                                               Hughes Communications, Inc.



Document Created: 2007-09-24 15:53:35
Document Modified: 2007-09-24 15:53:35

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