Attachment guarantee

This document pretains to SAT-AMD-20001103-00158 for Amended Filing on a Satellite Space Stations filing.

IBFS_SATAMD2000110300158_397152

moert fim tod vnsovsrtmsiir IG\ T y s gt" n T y s c:surle probaizmree Dies Fucmam on pupeiincincon July 30, 2004 RECEIVED JUL 3 0 2004 reem cmmonos morecou niscot EX PARTE VIA HAND DELIVERY omer o ne im Ms. Marlene H. Dortch geasac Int‘} Bureau Federal Communications Commission " 445 12th Street, S.W. AUG U 4 2004 Washington, D.C. 20554 9 Front Offico Re: TMI Communications and Company Limited Partnership File No 180.SAT—LOLO7 IBFS Nos. SAT—LOI—19970926—00161 SAT—AMD=20001103—601 58 Dear Ms. Dortch: This is being filed on behalf of TMI Communications and Company Limited Partnership (TM) to transmit the original of the TMI cover letter filed in facsimile form yesterday with the Commission. Any questions regarding thisfiling should be directed to the undersigned. hy Very traly yours, ce:— Steven Spacth William Bell Cassandra Thomas Wharton B. Rivers, TerreStar

RECEIVED ORIGINAL JuL 3 9 2004 T MI ‘ COMMUNICATIONS® mmonos canmsenn July 29, 2004 Mr. Roderick K. Porter Deputy Bureau Chief, International Bureau Federal Communications Commission 445 12th Streeu, S.W. Washington, DC 20554 Re: File Nos. SAT—LOH—19970926—00161 SAT—AMD—20001 103—00158 Dear Mr. Porter: We are transmitting with this leter,a copy of a Guarantee by TMI Communications and Company Limited Partership (TM) covering payments due under the satellite construction contract (Satellite Contract) by TerreStar Networks, Inc. (TerreStar)to Space Systems/Loral Inc. (Loral). This Guarantee satisfies the milestone waiver condition stated in Paragraph 49 of the Commission‘s Memorandum Opinion and Order, FCC 04— 144,released June 29, 2004 (Order) reinstating TMIs 2 GHz mobile satellte service (MSS) authorization. On July 26, 2002, in response to the Bureau‘s prior request, TML previously submitted to the Bureau, in confidence, a copy of the Satellite Contract. If the Bureau wishes to review subsequent amendments, including, most recently, an amendment to adjust Loral‘s work program and the related payment schedule to the new milestone dates established at Paragraph 59 of the Order, TMI also is willing to submit them in confidence. The Satellite Contract, as amended, commits TerreStar and Loral to construct and launch the 2GHz MSS system on a schedule which satisfies the revised milestones by requiring performance prior to the end ofthe applicable months specified in Paragraph 59 of the Order. We also want to take this opportunity to provide some background on the Guarantce, as well as TM‘s obligations and intentions under the Guarantee. Several years ago, for a number ofbusiness and market reasons, TMI determined that the best way to pursue the development ofthe next generation mobile satellte systems in North America (both our existing L—band satellite business as well as our prospective TL Conmnicaton ind Companyind Proarshly 1601 TiCors Gowcenr OM CoraaKIB 1tP To aisrazooe rac o raam wmeinacitire on

2GHz license effort), was through joint ventures with Motient Inc. and other American partners. As a result, in November, 2001, we contributed our mobile satellite operating assets to these joint ventures, and in December, 2002, we applied for transfer of control of our 2GHz FCC authorization to TerreStar. Since the inception ofthese joint ventures, we and our American partners have invested over $100 million in cash in these efforts and are currently neaing completion ofan additional financing in excess of $150 million. Following the current round of financing, these joint ventures will be debt free, will have significant liquid financial resources, and will possess the management, engineering and intellectual property assets necessary to move forward. Given these assets, we continue to believe that the best business approach to funding and deploying this 2 GHe satellite system is through our TerreStar joint venture, and we look forward to working with the International Bureau to transfer TMT‘s rights under ts reinstated FCC authorization to TerreStar (or ts designee) in an expeditious fashion. TMI also plans to transfer its Canadian Approval in Principle for its 2 GHz satellite system to a Canadion entity (*Canadian Licensee") in which TerreStar and /or the joint ventures (or affilites) will have an interest and which will be eligible, by virtue of its Canadian ownership, to hold this authorization under both the Radfocommunication Act (Canada) and the Telecommunications Act (Canada). The enclosed Guarantee obligates "TM] to cover the construction contract expenditures which have been negotiated between TerreStar and Loral, while at the same time reflecting the decision of the partics involved in the TerreStar joint venture to develop the 2GHe assets through such joint venture. Accordingly, in connection with the Guarantee, TMI and TerreStar have also agreed that TerreStar shall be obliged to put monies in escrow to cover payments due and owing to Loralat any point in time. However, we also note that the Guarantee is effective as of the date it was signed and is not contingent or conditioned upon any additional action by TerreStar or any other party. Purther, Loral has already been prepaid by TerreStar for all amounts due and owing through January, 2005. We also note Section 3 ofthe Guarantee, which provides TMT‘s right to withdraw this Guarantee in the future, but only upon being subject t the same termination liability payments to Loral under the Satellite Contract that TerreStar would be subject to were it to terminate its obligations to Loral. The Guarantee would also terminate once TMI‘s Canadian Approval in Principle is transferred to the Canadian Licensee as described above, subject to obtaining the necessary regulatory approvals. Finally, TMI wishes to advise the Bureau that TMI shortly plans to ask Industry Canada. to conform the July 17, 2006 milestone in its Approval in Principle (requiring TMI to place its satelliteinto its assigned Canadian orbital position at 107.3 degrees West) to the revised November 2007 satellite launch milestone adopted in the FCC‘s Order. TMI will inform the Commission (as well as the Bureau) within ten days of any action by Industry Canada.

In summary, we remain a large and active owner ofTerreStar and believe that the development of advanced mobile satellite systems over North America holds tremendous promise for remote and rural consumers in both Canada and the United States, We and our American partners have invested large amounts of capital and intellectual energy over the past several years to make this vision a reality. We believe the resolution of a number of regulatory issues pertaining to mobile satellite services will help to provide certainty to the investment community and will assist us in implementing these new ventures. Very truly yours, Prosigest and Che! Resvorive Officer TMI Communications, Inc., for and on behalf of, TMI Communications and Company Limited Partnership Enclosure ce: Donald Abelson, Chicf, International Bureau Steven Spacth, Legal Advisor, Bureau Chief Karl Kensinger, Associate Division Chief, Satellite Division William Bell, Attomey, Policy Branch., Satelite Division Wharton B. Rivers, Jr., CBO, TerreStar Networks, Inc.


Document Created: 2004-09-25 18:11:19
Document Modified: 2004-09-25 18:11:19
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