0604024 Informal Interpretation

From:(redacted)

Sent:Tuesday, April 04, 2006 10:03 AM

To:Verne,B. Michael

Subject:Question

Hereare the facts underlying my recent voicemail message.

1.American company is building atelecommunications satellite that has not been launched.

2.A Canadian company owns the rights to ageosynchronous orbit slot located above Canadian territory. Use of that slot issubject to Canadian government regulation. Any satellite using that slot mustbe owned by an entity that is Canadian controlled.

3.The parties will form a new Canadianentity controlled by the Canadian company.

4.That new Canadian entity will"acquire" the satellite when it is launched into the geosynchronousorbit and grant an immediate perpetual lease of 98% of the satellite capacityback to the American company that built the satellite. (The Canadian entity isrequired to retain a small portion of the capacity for possible emergency useby the Canadian government.)

5. The American company will operate the satellite andretain all the resulting revenues. The satellite will serve telecommunicationscustomers located both in Canada and in the U.S.

Canwe chat?