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Published: 2008-03-26

Hughes Spin-Off Separation Agreement - HE Holdings Inc. and General Motors Corp.



                     HUGHES SPIN-OFF SEPARATION AGREEMENT,

                         dated as of __________, 1997,

                                 by and between

                               HE HOLDINGS, INC.

                                      and

                           GENERAL MOTORS CORPORATION

 
                               Table of Contents

                                                                            Page

1.   Definitions............................................................   2
     -----------

2.   Certain Intercompany Matters...........................................   9
     ----------------------------
     2.1   Capital Stock Matters............................................   9
     2.2   Publicity........................................................  10
     2.3   Further Assurances...............................................  10

3.   Expenses...............................................................  11
     --------
     3.1   General..........................................................  11
     3.2   Certain Costs Relating to Hughes Common Stock....................  11
     3.3   Certain Transactions Costs.......................................  11

4.   Covenants To Preserve Tax-Free Status Of Hughes Spin-Off...............  12
     --------------------------------------------------------
     4.1   Representations and Warranties...................................  12
     4.2   Restrictions on Hughes...........................................  12
     4.3   Cooperation and Other Covenants..................................  17
     4.4   Indemnification for Tax Liabilities..............................  18
     4.5   Procedure for Indemnification for Tax Liabilities................  19
     4.6   Arbitration......................................................  20
     4.7   Exclusive Remedies...............................................  21

5.   Indemnification........................................................  21
     ---------------
     5.1   Indemnification by Hughes........................................  21
     5.2   Indemnification by GM............................................  21
     5.3   Other Liabilities................................................  22
     5.4   Tax Effects of Indemnification...................................  22
     5.5   Effect of Insurance Upon Indemnification.........................  22
     5.6   Procedure for Indemnification Involving Third-Party Claims.......  23
     5.7   Procedure for Indemnification Not Involving Third-Party Claims...  24
     5.8   Exclusive Remedies...............................................  25

6.   Miscellaneous..........................................................  25
     -------------
     6.1   Dispute Resolution...............................................  25
     6.2   Survival.........................................................  25
     6.3   Complete Agreement...............................................  25
     6.4   Authority........................................................  25
     6.5   Governing Law....................................................  25
     6.6   Consent to Exclusive Jurisdiction................................  25
     6.7   Notices..........................................................  26
     6.8   Amendment and Modification.......................................  27
     6.9   Binding Effect; Assignment.......................................  27

                                      -i-

 
     6.10  Third Party Beneficiaries........................................  27
     6.11  Counterparts.....................................................  28
     6.12  Waiver...........................................................  28
     6.13  Severability.....................................................  28
     6.14  Remedies.........................................................  28
     6.15  Performance......................................................  28
     6.16  References; Construction.........................................  28

                                     -ii-

 
                      HUGHES SPIN-OFF SEPARATION AGREEMENT
                      ------------------------------------



     This HUGHES SPIN-OFF SEPARATION AGREEMENT ('Agreement') is made and entered
into as of __________, 1997, by and between Hughes, a Delaware corporation, and
GM, a Delaware corporation.  Capitalized terms used and not otherwise defined
herein are defined in Section 1 below.

                                    RECITALS
                                    --------

     WHEREAS, Hughes and Raytheon desire to combine the Raytheon Business with
the Hughes Business;

     WHEREAS, Hughes and Raytheon have entered into the Hughes Merger Agreement,
pursuant to which Raytheon shall merge with and into Hughes, with Hughes as the
surviving corporation, in accordance with the terms and subject to the
conditions thereof;

     WHEREAS, as a condition to entering into the Hughes Merger Agreement,
Raytheon has required that GM agree that, at the time of the consummation of the
Hughes Merger, Hughes be an independent, publicly owned company, comprising the
Defense Business;

     WHEREAS, in response to such requirement, GM and Raytheon have entered into
the Implementation Agreement and, as contemplated thereby, GM and Merger Sub
have entered into the Hughes Distribution Agreement, pursuant to which, subject
to certain terms and conditions contained therein, Merger Sub shall merge with
and into GM, with GM as the surviving corporation such that, among other things,
the holders of shares of GM $1 2/3 Common Stock and the holders of shares of GM
Class H Common Stock shall receive a distribution of shares of Hughes Class A
Common Stock (representing all of the outstanding common stock of Hughes) in the
Hughes Spin-Off;

     WHEREAS, the parties intend that (a) the Hughes Merger constitute a tax-
free 'reorganization' within the meaning of Section 368(a) of the Code and (b)
the Hughes Spin-Off qualify as a tax-free (to GM and the holders of GM Common
Stock) spin-off within the meaning of Section 355 of the Code;

     WHEREAS, the parties hereto have determined that in order to accomplish the
objectives of the Hughes Spin-Off and to facilitate the consummation thereof, it
is necessary and desirable to restructure certain intercompany relationships,
allocate certain liabilities and provide mutual indemnification, all as set
forth herein;

     WHEREAS, the execution and delivery of this Agreement is a condition to
GM's obligation to consummate the transactions contemplated by the Hughes
Distribution Agreement; and

                                      -1-

 
     WHEREAS, concurrently with the execution and delivery of this Agreement,
GM, Telecom, Delco and Hughes are entering into certain other agreements
relating to the HEC Reorganization, the Hughes Spin-Off and/or the relationships
of the parties thereafter, including, without limitation, as to matters such as
taxes, indemnification, employee benefits, insurance, intellectual property,
real property, transition services and shared research and development;

     NOW, THEREFORE, in consideration of the premises and the representations,
warranties, covenants and agreements herein contained, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and intending to be legally bound hereby, the parties hereby agree
as follows:

 1.  Definitions.
     ----------- 

     'Active Trade or Business' means the active conduct of the trade or
business  (as defined in Section 355(b)(2) of the Code) conducted by Hughes
immediately prior to the Effective Time.

     'Affiliate' means a Hughes Affiliate, a GM Affiliate or a Raytheon
Affiliate, as the case may be.

     'Business' means the Hughes Business, the GM Business or the Raytheon
Business, as the case may be.

     'Business Day' means any day other than a Saturday, a Sunday, or a day on
which banking institutions located in the State of New York are authorized or
obligated by law or executive order to close.

     'Claim' has the meaning set forth in Section 5.7.

     'Code' means the Internal Revenue Code of 1986, as amended from time to
time, together with the rules and regulations promulgated thereunder.

     'Control' means the possession, direct or indirect, of the power to direct
or cause the direction of the management and policies of a Person, whether
through the ownership of voting securities, by contract, or otherwise.

     'CPR Rules' means the Rules for Non-Administered Arbitration of Business
Disputes promulgated by the Center for Public Resources, as in effect on the
date hereof.

     'DGCL' means the General Corporation Law of the State of Delaware, as in
effect on the date hereof and as the same may hereafter be amended from time to
time.

     'Defense Business' has the meaning ascribed to such term in the Separation
Agreement.

     'Delco' has the meaning ascribed to such term in the Separation Agreement.

                                      -2-

 
     'Dispute Notice' means written notice of any dispute between GM and Hughes
arising out of or relating to this Agreement, which shall set forth, in
reasonable detail, the nature of the dispute.

     'Effective Time' means the date and time at which the Hughes Spin-Off
Merger becomes effective.

     'Exchange Act' means the Securities Exchange Act of 1934, as amended from
time to time, together with the rules and regulations promulgated thereunder.

     'GM' means General Motors Corporation, a Delaware corporation.

     'GM Affiliate' means a Person that, after giving effect to the Hughes Spin-
Off, directly or indirectly through one or more intermediaries, is Controlled by
GM.

     'GM Business' means any business or operations of GM or any GM Affiliates
other than the Hughes Business.

     'GM Class H Common Stock' means the Class H Common Stock, par value $0.10
per share, of GM.

     'GM Class HT Common Stock' has the meaning ascribed to such term in the
Hughes Distribution Agreement.

     'GM Common Stock' means the GM $1 2/3 Common Stock and the GM Class H
Common Stock and, from and after the Effective Time, the GM Class HT Common
Stock.

     'GM $1 2/3 Common Stock' means the Common Stock, par value $1 2/3 per
share, of GM.

     'GM Disclosure Portions' means any material set forth in either the Hughes
Spin-Off Registration Statement or the Hughes Merger Registration Statement (i)
relating to (A) Hughes, the capital stock of Hughes, the Hughes Business,
financial information and data relating to Hughes (including both historical and
pro forma financial data) or (B) the GM Transactions or (ii) that otherwise does
not constitute a part of a Hughes Disclosure Portion.  For purposes of clause
(i)(A), Hughes shall include Hughes only prior to the consummation of the Hughes
Merger and shall not include Hughes as the surviving corporation of the Hughes
Merger.

     'GM Transactions' has the meaning ascribed to such term in the Hughes
Distribution Agreement.

     'GM Transfer Agent' means Boston EquiServe, L.P., in its capacity as the
transfer agent for the GM Common Stock.

     'HEC Reorganization' has the meaning ascribed to such term in the Hughes
Distribution Agreement.

                                      -3-

 
     'Hughes' means HE Holdings, Inc., a Delaware corporation, after giving
effect to the consummation of the HEC Reorganization, and, upon the consummation
of the Hughes Merger, the surviving corporation of the Hughes Merger.

     'Hughes Affiliate' means a Person that, after giving effect to the Hughes
Spin-Off, directly or indirectly through one or more intermediaries, Controls,
is Controlled by, or is under common Control with Hughes.

     'Hughes Business' means the Defense Business and, upon the consummation of
the Hughes Merger, the Raytheon Business.

     'Hughes Capital Stock' means all classes or series of capital stock of
Hughes.

     'Hughes Class A Common Stock' means the Class A Common Stock, par value
$0.01 per share, of Hughes, as set forth in Hughes' Certificate of Incorporation
as of immediately prior to the Effective Time.

     'Hughes Class B Common Stock' means the Class B Common Stock, par value
$0.01 per share, of Hughes, as set forth in Hughes' Certificate of Incorporation
as of immediately prior to the Effective Time.

     'Hughes Common Stock' means Hughes Class A Common Stock and Hughes Class B
Common Stock.

     'Hughes Disclosure Portions' means all material set forth in either the
Hughes Spin-Off Registration Statement or the Hughes Merger Registration
Statement relating to (i) Raytheon, the capital stock of Raytheon, the Raytheon
Business, financial information and data relating to Raytheon (including both
historical and pro forma financial data) or (ii) the Hughes Merger, plans
regarding Hughes after the Hughes Merger and other forward-looking information
regarding Hughes.

     'Hughes Distribution Agreement' means the Agreement and Plan of Merger by
and between GM and Merger Sub, dated as of ______, 1997, as amended from time to
time.

     'Hughes Merger' means the merger of Raytheon with and into Hughes pursuant
to the Hughes Merger Agreement, with Hughes as the surviving corporation.

     'Hughes Merger Agreement' means the Agreement and Plan of Merger by and
between Hughes and Raytheon, dated as of January 16, 1997, as amended from time
to time.

     'Hughes Merger Registration Statement' means the Registration Statement on
Form S-4 filed or to be filed with the SEC by Hughes relating to the shares of
Hughes Class B Common Stock to be issued in connection with the Hughes Merger,
as supplemented or amended from time to time.

                                      -4-

 
     'Hughes Spin-Off' means the distribution of Hughes Class A Common Stock to
the holders of GM Common Stock pursuant to the Hughes Spin-Off Merger.

     'Hughes Spin-Off Merger' means the merger of Merger Sub with and into GM
pursuant to the Hughes Distribution Agreement, with GM as the surviving
corporation.

     'Hughes Spin-Off Registration Statement' means the Registration Statement
on Form S-4 filed or to be filed with the SEC by Hughes relating to the shares
of Hughes Class A Stock to be distributed in connection with the Hughes Spin-
Off, as supplemented or amended from time to time.

     'Hughes Transfer Agent' means ______________, in its capacity as the
transfer agent for the Hughes Common Stock.

     'Implementation Agreement' means the Implementation Agreement by and
between GM and Raytheon, dated as of January 16, 1997, as amended from time to
time.

     'Indemnifying Party' means a Person that is obligated to provide
indemnification under this Agreement.

     'Indemnitee' means a Person that is entitled to seek indemnification under
this Agreement.

     'Indemnity Payment' means an amount that an Indemnifying Party is required
to pay to an Indemnitee under this Agreement.

     'Insurance Proceeds' means the payment received by an insured from an
insurance carrier or paid by an insurance carrier on behalf of the insured, net
of any applicable premium adjustment and tax effect.

     'IRS' means Internal Revenue Service of the U.S. Department of Treasury or
any successor agency.

     'Losses' means all losses, liabilities, claims, obligations, demands,
judgments, damages, dues, penalties, assessments, fines (civil or criminal),
costs, liens, expenses, forfeitures, settlements, or fees, reasonable attorneys'
fees and court costs, of any nature or kind, whether or not the same would
properly be reflected on a balance sheet, and 'Loss' means any of these.

     'Merger Sub' means __________ Corporation, a Delaware corporation and a
wholly-owned subsidiary of GM.

     'Negotiation Period' means the period of 20 Business Days following the
initial meeting of the representatives of GM and Hughes following the receipt of
a Dispute Notice.

     'Notice' means any notice, request, claim, demand, or other communication
under this Agreement.

                                      -5-

 
     'Person' means an individual, partnership, joint venture, corporation,
trust, unincorporated association, any other entity, or a government or any
department or agency or other unit thereof.

     'Prior Relationship' means the ownership relationships among GM, Hughes,
Telecom and Delco at any time prior to giving effect to the consummation of the
HEC Reorganization and the Hughes Spin-Off.

     'Proposed Acquisition Transaction' means a transaction or series of
transactions as a result of which any Person or any group of related Persons
would acquire, or have the right to acquire, (i) from one or more holders of
outstanding shares of Hughes Capital Stock, a number of shares of Hughes Capital
Stock that would comprise more than 15% of (A) the value of all outstanding
shares of Hughes Capital Stock as of the date of such transaction, or in the
case of a series of transactions, the date of the last transaction of such
series, or (B) the number of the issued and outstanding shares of Hughes Class A
Common Stock or Hughes Class B Common Stock as of the date of such transaction,
or in the case of a series of transactions, the date of the last transaction of
such series, or (ii) from Hughes, all or a substantial portion of its assets or
business in exchange in whole or in part for equity interests in such Person or
group which are received by holders of Hughes Capital Stock.

     'Proposed Stock Buyback Transaction' means a transaction or series of
transactions as a result of which Hughes or a Hughes Affiliate would acquire, or
have the right to acquire, one or more shares of Hughes Capital Stock.

     'Proposed Stock Issuance Transaction' means a transaction or series of
transactions as a result of which any Person would acquire, or have the right to
acquire, from Hughes or a Hughes Affiliate, one or more shares of Hughes Capital
Stock.

     'Raytheon' means Raytheon Company, a Delaware corporation.

     'Raytheon Affiliate' means a Person that directly or indirectly through one
or more intermediaries, Controls, is Controlled by, or is under common Control
with Raytheon.

     'Raytheon Business' means any business or operations of Raytheon.

     'Representation Date' means any date on which Hughes makes any
representation (i) to the IRS or to counsel selected by GM for the purpose of
obtaining a Subsequent Tax Opinion/Ruling, or (ii) to GM for the purpose of any
determination required to be made by GM pursuant to Section 4.2.

     'Representation Letters' means the representation letters and any other
materials deliverable by GM and others in connection with the rendering by Tax
Counsel and the issuance by the IRS of the Tax Opinions/Rulings, which to the
extent related to Hughes, Raytheon or the Surviving Corporation (as defined in
the Hughes Merger Agreement) shall be in form and substance reasonably
satisfactory to Hughes and Raytheon.

                                      -6-

 
     'Representative' means, with respect to any Person, any of such Person's
directors, officers, employees, agents, consultants, advisors, accountants or
attorneys.

     'Request' has the meaning set forth in Section 5.7.

     'Securities Act' means the Securities Act of 1933, as amended from time to
time, together with the rules and regulations promulgated thereunder.

     'Separate Counsel' has the meaning set forth in Section 5.6(b).

     'Separation Agreement' means the Master Separation Agreement by and among
GM, Telecom, Delco and Hughes, dated as of ________, 1997, as amended from time
to time.

     'Service Agent' means (i) for GM, The Corporation Trust Company, with
offices on the date hereof at 1209 Orange Street, Wilmington, County of New
Castle, Delaware 19801; and (ii) for Hughes, The Corporation Trust Company, with
offices on the date hereof at 1209 Orange Street, Wilmington, County of New
Castle, Delaware.

     'Subsequent Tax Opinion/Ruling' means either (i) an opinion of counsel
selected by GM, in its sole and absolute discretion, confirming, in form and
substance reasonably satisfactory to GM, that, as a consequence of the
consummation of a subsequent transaction, (A) no income, gain or loss for U.S.
federal income tax purposes will be recognized by GM, the stockholders or former
stockholders of GM, or any GM Affiliate with respect to the Hughes Spin-Off
and/or the Telecom Spin-Off, or (B) no income, gain or loss for U.S. federal
income tax purposes will be recognized by GM, Hughes, Raytheon or any of their
Affiliates, or by Hughes' stockholders (including, without limitation, GM
stockholders who become Hughes stockholders as a result of the Hughes Spin-Off),
with respect to the Hughes Merger; or (ii) an IRS private letter ruling to the
same effect.

     'Subsidiary' means with respect to any specified Person, any corporation or
other legal entity of which such Person or any of its Subsidiaries Controls or
owns, directly or indirectly, more than 50% of the stock or other equity
interest entitled to vote on the election of members to the board of directors
or similar governing body; provided, however, that for the purposes of this
Agreement, neither Hughes nor any of the Subsidiaries of Hughes shall be deemed
to be Subsidiaries of GM or of any of the Subsidiaries of GM.

     'Tax' means (i) any income, gross receipts, license, payroll, employment,
excise, severance, stamp, occupation, premium, windfall profits, environmental
(including taxes under Code Section 59A), customs duties, capital stock,
franchise, profits, withholding, social security (or similar), unemployment,
disability, real property, personal property, sales, use, transfer,
registration, value added, alternative or add-on, minimum, estimated, or other
tax, assessment, or governmental charge of any kind whatsoever imposed by any
governmental authority, including any interest, penalty, or addition thereto,
whether disputed or not; (ii) liability for the payment of any amounts of the
type described in clause (i) above arising as a result of being (or having been)
a member of any group or being (or having been) included or required to be
included in any Tax Return related thereto; and (iii) liability for the payment
of any amounts of the type described in clause (i) above as a result of

                                      -7-

 
any express or implied obligation to indemnify or otherwise assume or succeed to
the liability of any other Person.

     'Tax Agreement' means the Tax Sharing Agreement by and among GM, Hughes and
Telecom, dated as of ______, 1997, as amended from time to time, relating to
certain tax matters.

     'Tax Counsel' means Kirkland & Ellis, with respect to those Tax
Opinions/Rulings deliverable to GM relating to the transactions effectuated
pursuant to the Hughes Distribution Agreement, and Weil, Gotshal & Manges, LLP,
with respect to the Tax Opinions/Rulings deliverable to GM and Hughes relating
to the transactions effectuated pursuant to the Hughes Merger Agreement.

     'Tax-Free Status of the Hughes Merger' means the nonrecognition of taxable
income, gain or loss for U.S. federal income tax purposes to GM, Hughes,
Raytheon and their Affiliates, and to Hughes' stockholders (including, without
limitation, GM stockholders who become Hughes stockholders as a result of the
Hughes Spin-Off) in connection with the Hughes Merger.

     'Tax-Free Status of the Spin-Offs' means the nonrecognition of taxable gain
or loss for U.S. federal income tax purposes to GM, GM Affiliates and GM's
stockholders in connection with the Hughes Spin-Off and/or the Telecom Spin-Off.

     'Tax Opinions/Rulings' means, collectively, the opinions of Tax Counsel and
the rulings by the IRS deliverable to GM in connection with (i) the transactions
contemplated by the Hughes Distribution Agreement and (ii) the transactions
contemplated by the Hughes Merger Agreement.

     'Tax-Related Losses' means (i) all federal, state and local Taxes
(including interest and penalties thereon) imposed pursuant to any settlement,
final determination, judgment or otherwise; (ii) all accounting, legal and other
professional fees, and court costs incurred in connection with such taxes; and
(iii) all costs and expenses that may result from adverse tax consequences to GM
or GM's stockholders (including all costs, expenses and damages associated with
stockholder litigation or controversies) payable by GM or GM Affiliates.

     'Telecom' has the meaning ascribed to such term in the Separation
Agreement.

     'Telecom Spin-Off' means the spin-off of Telecom by Hughes to GM included
as part of the HEC Reorganization.

     'Third-Party Claim' means any claim, suit, arbitration, inquiry, proceeding
or investigation by or before any court, governmental or other regulatory or
administrative agency or commission or any arbitration tribunal asserted by a
Person other than GM or any GM Affiliate or Hughes or any Hughes Affiliate which
gives rise to a right of indemnification hereunder.

     'Voting Stock' means with respect to any Person, all classes and series of
the capital stock of such Person entitled to vote generally in the election of
directors.

                                      -8-

 
 2.  Certain Intercompany Matters.
     ---------------------------- 

      2.1  Capital Stock Matters.

          (a) Recognition of Stockholders.  From and after the Effective Time
     and until such Hughes Class A Common Stock is duly transferred in
     accordance with applicable law, Hughes shall regard the Persons who were
     record holders of GM $1 2/3 Common Stock and the Persons who were record
     holders of GM Class H Common Stock, in each case as of immediately prior to
     the Effective Time, as the record holders of Hughes Class A Common Stock,
     as described in and subject to the terms of the Hughes Distribution
     Agreement, without requiring any action on the part of such Persons.
     Hughes agrees that, subject to any transfers of such stock, (i) each such
     holder shall be entitled to receive all dividends payable on, and exercise
     voting rights and all other rights and privileges with respect to, Hughes
     Class A Common Stock and (ii) each such holder shall be entitled, without
     any action on the part of any such holder, subject to Section 2.3 of the
     Hughes Merger Agreement, to receive one or more certificates representing
     the shares of Hughes Class A Common Stock then held by it.

          (b) GM Representations and Warranties.  GM hereby represents and
     warrants that, as of immediately prior to the Effective Time, (i)
     ___________ shares of GM $1 2/3 Common Stock and ___________ shares of GM
     Class H Common Stock will be issued and outstanding, (ii) all of such
     shares will be validly issued, fully paid and nonassessable, and (iii)
     there will be (x) no outstanding securities of GM or any of its
     Subsidiaries convertible into or exchangeable for shares of GM $1 2/3
     Common Stock or GM Class H Common Stock and (y) other than stock options
     granted pursuant to GM's employee benefit plans and other than as provided
     in Article Fourth of GM's Amended and Restated Certificate of
     Incorporation, no outstanding subscriptions, options, warrants, rights or
     other arrangements or commitments to which GM is a party obligating GM to
     issue any shares of GM $1 2/3 Common Stock or GM Class H Common Stock.

          (c) Hughes Representations and Warranties.  Hughes hereby represents
     and warrants that, as of immediately prior to the Effective Time, (i)
     102,630,503 shares of Hughes Class A Common Stock will be issued and
     outstanding, (ii) all of such shares will be validly issued, fully paid and
     nonassessable, (iii) all of such shares will be held of record by GM, (iv)
     such shares shall represent all of the issued and outstanding Hughes
     Capital Stock, and (v) there will be (x) no outstanding securities of
     Hughes or any of its Subsidiaries convertible into or exchangeable for
     shares of Hughes Class A Common Stock and (y) no outstanding subscriptions,
     options, warrants, rights or other arrangements or commitments to which
     Hughes is a party obligating Hughes to issue any shares of Hughes Class A
     Common Stock.

          (d) Cooperation of Transfer Agents; Stockholder Records.  GM shall
     cooperate, and shall instruct the GM Transfer Agent to cooperate, with
     Hughes and the Hughes Transfer Agent, and Hughes shall cooperate, and shall
     instruct the Hughes Transfer Agent to cooperate, with GM and the GM
     Transfer Agent, in connection with the Hughes Spin-Off

                                      -9-

 
     and all other matters relating to (i) the issuance and delivery of
     certificates evidencing the shares of Hughes Class A Common Stock  (and
     payment of cash in lieu of any fractional shares of Hughes Class B Common
     Stock as described in the Hughes Merger Agreement) to be distributed in
     respect of all shares of GM $1 2/3 Common Stock and GM Class H Common Stock
     outstanding as of immediately prior to the Effective Time and (ii) the
     exchange of certificates evidencing the recapitalization and conversion of
     all shares of GM Class H Common Stock outstanding as of immediately prior
     to the Effective Time into shares of GM Class HT Common Stock.  Following
     the Effective Time, GM shall instruct the GM Transfer Agent to distribute
     letters of transmittal, in form reasonably satisfactory to GM and Hughes,
     to all holders of GM Class H Common Stock as of immediately prior to the
     Effective Time in connection with the exchange of certificates representing
     shares of GM Class H Common Stock for certificates representing shares of
     GM Class HT Common Stock and certificates representing shares of Hughes
     Class A Common Stock.  Following the Effective Time, GM shall instruct the
     GM Transfer Agent to deliver to the Hughes Transfer Agent true, correct and
     complete copies of the transfer records reflecting the record holders of GM
     $1 2/3 Common Stock and GM Class H Common Stock, in each case as of
     immediately prior to the Effective Time.  Upon the reasonable request of
     Hughes from time to time after the Effective Time in connection with any
     legitimate corporate purpose, GM shall cooperate, or shall instruct the GM
     Transfer Agent to cooperate, in providing Hughes with reasonable access to
     all historical share, transfer and dividend payment records with respect to
     the holders of GM $1 2/3 Common Stock and GM Class H Common Stock as of
     immediately prior to the Effective Time.

      2.2  Publicity.  Hughes, with respect to Hughes and all of the Hughes
Affiliates, and GM, with respect to GM and all of the GM Affiliates, agree to
take all commercially reasonable action to discontinue their respective uses as
promptly after the Effective Time as is commercially reasonable of any printed
material that indicates a continued Prior Relationship between or among GM and
Hughes or any of their respective Affiliates.  This Section 2.2 shall not be
deemed to prohibit the use of printed material containing appropriate and
accurate references to the Prior Relationship.

      2.3  Further Assurances.  In addition to the actions specifically provided
for elsewhere in this Agreement, each of the parties hereto shall use all
commercially reasonable efforts to take, or cause to be taken, all actions, and
to do, or cause to be done, all things commercially reasonably necessary, proper
or expeditious under applicable laws, regulations and agreements in order to
consummate and make effective the Hughes Spin-Off as promptly as reasonably
practicable. Without limiting the generality of the foregoing, each party hereto
shall cooperate with the other party, and execute and deliver, or use all
commercially reasonable efforts to cause to have executed and delivered, all
instruments, including instruments of conveyance, assignment and transfer, and
to make all filings with, and to obtain all consents, approvals or
authorizations of, any domestic or foreign governmental or regulatory authority
in order to make effective the Hughes Spin-Off.

                                      -10-

 
 3.  Expenses.
     -------- 

      3.1  General.  Except as otherwise provided in this Agreement, the
Separation Agreement and the other agreements contemplated thereby, all costs
and expenses of either party hereto in connection with the Hughes Spin-Off
and/or the Hughes Merger shall be paid by the party that incurs such costs and
expenses.

      3.2  Certain Costs Relating to Hughes Common Stock.  Hughes shall pay all
costs of printing and engraving with respect to certificates representing Hughes
Common Stock, fees of any transfer or exchange agent engaged by Hughes, and all
fees relating to listing Hughes Common Stock on any domestic or foreign stock
exchange or similar organization.

      3.3  Certain Transactions Costs.

          (a) Certain Merger Costs to be Paid by Hughes.  Hughes shall pay all
     costs and expenses relating exclusively to the Hughes Merger, including,
     without limitation, all reasonable out-of-pocket costs and expenses of
     printing and distributing the Hughes Merger Registration Statement and any
     related materials (including any proxy or consent solicitation statement),
     the fees associated with filing the Hughes Merger Registration Statement
     and any related materials (including any proxy or consent solicitation
     statement) with the SEC, the fees associated with making any other federal,
     state, local or foreign governmental securities law or other regulatory
     filings exclusively in connection with the Hughes Merger, the fees and
     expenses of the Hughes Transfer Agent and any proxy or consent solicitation
     agents, information agents or similar consultants engaged by Raytheon in
     connection with effecting the Hughes Merger.  Hughes shall also pay, unless
     otherwise agreed between GM and Hughes, the fees and expenses of Goldman,
     Sachs & Co. and the fees and expenses of Weil, Gotshal & Manges LLP in
     connection with the Hughes Merger; provided that such fees and expenses, to
     the extent to be paid by Hughes after the effective time of the Hughes
     Merger, shall be included as current liabilities on the Closing Date
     Balance Sheet (as defined in the Separation Agreement).

          (b) Certain Merger Costs to be Paid by GM.  GM or one of its
     subsidiaries shall pay all fees and out-of-pocket expenses of Hughes in
     connection with the Hughes Merger except as contemplated by Section 3.3(a).

          (c) Certain Costs to be Paid by GM.  GM or one of its subsidiaries
     shall pay all costs and expenses relating to the GM Transactions (other
     than as provided in Section 3.2 and other than those relating exclusively
     to the Hughes Merger, which are addressed in Sections 3.3(a) and 3.3(b)
     above), including, without limitation, all costs and expenses relating
     exclusively to the Hughes Spin-Off Merger, including, without limitation,
     all reasonable out-of-pocket costs and expenses of printing and
     distributing the Hughes Spin-Off Registration Statement and any related
     materials (including any proxy or consent solicitation statement), the fees
     associated with filing the Hughes Spin-Off Registration Statement and any
     related materials (including any proxy or consent solicitation statement)
     with the SEC, the fees associated with making any other federal, state,
     local or foreign

                                      -11-

 
     governmental securities law or other regulatory filings exclusively in
     connection with the Hughes Spin-Off Merger, and the fees and expenses of
     the GM Transfer Agent and any proxy or consent solicitation agents,
     information agents or similar consultants engaged by GM in connection with
     effecting the Hughes Spin-Off Merger.

 4.  Covenants To Preserve Tax-Free Status Of Hughes Spin-Off.
     -------------------------------------------------------- 

      4.1  Representations and Warranties.

          (a)  Hughes.  Hughes hereby represents and warrants that (i) it has
     examined the Tax Opinions/Rulings and the Representation Letters, and (ii)
     the facts presented and the representations made therein, to the extent
     descriptive of Hughes or the Hughes Business or Raytheon or the Raytheon
     Business (including, without limitation, the business purposes for the
     Hughes Spin-Off, Telecom Spin-Off and Hughes Merger, the representations in
     the Representation Letters and Tax Opinions/Rulings to the extent that they
     relate to Hughes or the Hughes Business or Raytheon or the Raytheon
     Business, and the plans, proposals, intentions and policies of Hughes or
     Raytheon), are true, correct and complete in all material respects.

          (b)  GM.  GM hereby represents and warrants that (i) it has examined
     the Tax Opinions/Rulings and the Representation Letters, and (ii) the facts
     presented and the representations made therein, to the extent descriptive
     of GM or the GM Business (including, without limitation, the business
     purposes for the Hughes Spin-Off, Telecom Spin-Off, the representations in
     the Representation Letters and Tax Opinions/Rulings to the extent that they
     relate to GM or the GM Business, and the plans, proposals, intentions and
     policies of GM), are true, correct and complete in all material respects.

      4.2  Restrictions on Hughes.

          (a) Proposed Secondary Capital Stock Transactions.  Until the first
     day after the two-year anniversary of the Effective Time, Hughes shall not
     enter into any Proposed Acquisition Transaction or, to the extent Hughes
     has the right to prohibit any Proposed Acquisition Transaction, permit any
     Proposed Acquisition Transaction to occur (whether by (i) redeeming rights
     under a stockholders rights plan, (ii) finding a tender offer to be a
     'permitted offer' under any such plan or otherwise causing any such plan to
     be inapplicable or neutralized with respect to any Proposed Acquisition
     Transaction, or (iii) approving any Proposed Acquisition Transaction,
     whether for purposes of Section 203 of the DGCL or any similar corporate
     statute, any 'fair price' or other provision of Hughes' charter or bylaws
     or otherwise) unless prior to the consummation of such Proposed Acquisition
     Transaction GM has determined, in its sole and absolute discretion, which
     discretion shall be exercised in good faith solely to preserve the Tax-Free
     Status of the Spin-Offs and the Tax-Free Status of the Hughes Merger, that
     such Proposed Acquisition Transaction would not jeopardize the Tax-Free
     Status of the Spin-Offs or the Tax-Free Status of the Hughes Merger.

                                      -12-

 
     The foregoing shall not prohibit Hughes from entering into a contract or
agreement to consummate any Proposed Acquisition Transaction if such contract or
agreement requires satisfaction of the above-described requirement prior to the
consummation of such Proposed Acquisition Transaction.

          (b) Proposed Primary Capital Stock Transactions.

               (i) Until the first day after the two-year anniversary of the
          Effective Time, Hughes shall not enter into any Proposed Stock
          Issuance Transaction if, as a result of such Proposed Stock Issuance
          Transaction, Hughes would issue a number of shares of Hughes Capital
          Stock that, when aggregated with all other shares of Hughes Capital
          Stock issued pursuant to any Proposed Stock Issuance Transaction
          occurring prior to or simultaneously with such Proposed Stock Issuance
          Transaction, would cause (A) the number of shares of Hughes Class A
          Common Stock distributed to GM stockholders in the Hughes Spin-Off to
          constitute less than 80% of the total combined voting power of all
          outstanding shares of Voting Stock of Hughes or (B) the issuance of
          outstanding shares of any class or series of Hughes Capital Stock
          other than Voting Stock of Hughes, unless prior to the consummation of
          such transaction GM has determined, in its sole and absolute
          discretion, which discretion shall be exercised in good faith solely
          to preserve the Tax-Free Status of the Spin-Offs and the Tax-Free
          Status of the Hughes Merger, that such transaction would not
          jeopardize the Tax-Free Status of the Spin-Offs or the Tax-Free Status
          of the Hughes Merger.

               (ii) Until the first day after the two-year anniversary of the
          Effective Time, Hughes shall not enter into any Proposed Stock Buyback
          Transaction if, as a result of such Proposed Stock Buyback
          Transaction, the then-outstanding shares of Hughes Class A Common
          Stock would constitute less than 80% of the total combined voting
          power of all outstanding shares of Voting Stock of Hughes, unless
          prior to the consummation of such transaction GM has determined, in
          its sole and absolute discretion, which discretion shall be exercised
          in good faith solely to preserve the Tax-Free Status of the Spin-Offs
          and the Tax-Free Status of the Hughes Merger, that such transaction
          would not jeopardize the Tax-Free Status of the Spin-Offs or the Tax-
          Free Status of the Hughes Merger.

               (iii)  For purposes of this Section 4.2(b), any option (including
          an option issued to employees or in connection with the performance of
          services), warrant or other security that would permit or require a
          Person to acquire shares of Voting Stock of Hughes or other Hughes
          Capital Stock (including the option, right or obligation of Hughes or
          a Hughes Affiliate to acquire shares of Hughes Capital Stock), or any
          security convertible into or exchangeable for shares of Voting Stock
          of Hughes or other Hughes Capital Stock, shall be treated as if it had
          been fully exercised, converted or exchanged at the time of issuance,
          whether or not such security is by its terms exercisable at such time.

                                      -13-

 
          (c) Amendment to Charter and Bylaws.  Until the first day after the
     three-year anniversary of the Effective Time, Hughes shall make no
     amendments or changes to its charter or bylaws that would affect the
     composition or size of its Board of Directors, the manner in which its
     Board of Directors is elected, and the duties and responsibilities of its
     Board of Directors unless GM has determined, in its sole and absolute
     discretion, which discretion shall be exercised in good faith solely to
     preserve the Tax-Free Status of the Spin-Offs and the Tax-Free Status of
     the Hughes Merger, that such amendment or change would not jeopardize the
     Tax-Free Status of the Spin-Offs or the Tax-Free Status of the Hughes
     Merger.

          (d) Continuation of Active Trade or Business.  Until the first day
     after the two-year anniversary of the Effective Time,

               (i) Hughes shall continue to conduct the Active Trade or
          Business.
 
               (ii) Subject to the last sentence of clause (d)(iii), Hughes
          shall not (A) liquidate, dispose of, or otherwise discontinue the
          conduct of any portion of the Active Trade or Business with a value in
          excess of $1.0 billion or (B) dispose of any business or assets that
          would cause Hughes to be operated in a manner inconsistent in any
          material respect with the business purposes for the Hughes Spin-Off as
          set forth in the Representation Letters and Tax Opinions/Rulings, in
          each case unless GM has determined, in its sole and absolute
          discretion, which discretion shall be exercised in good faith solely
          to preserve the Tax-Free Status of the Spin-Offs and the Tax-Free
          Status of the Hughes Merger, that such liquidation, disposition, or
          discontinuance would not jeopardize the Tax-Free Status of the Spin-
          Offs or the Tax-Free Status of the Hughes Merger.

               (iii)  Hughes shall not under any circumstances liquidate,
          dispose of, or otherwise discontinue the conduct of any portion of the
          Active Trade or Business if such liquidation, disposition or
          discontinuance would breach Section 4.2(e). Hughes shall continue the
          active conduct of the Active Trade or Business primarily through
          officers and employees of Hughes or its Subsidiaries (and not
          primarily through independent contractors) who are not also officers
          or employees of GM or of any GM Affiliates.  Notwithstanding the
          foregoing, (A) liquidations of any of Hughes' Subsidiaries into Hughes
          or one or more Subsidiaries directly or indirectly controlled by
          Hughes shall not be deemed to breach this Section 4.2(d) and (B)
          Hughes shall not be prohibited from liquidating, disposing of or
          otherwise discontinuing the conduct of one or more trades or
          businesses that constituted part of the Active Trade or Business, or
          any portion thereof, provided that, in the case of this clause (B),
          the aggregate value of such trades or businesses, or portions thereof,
          so liquidated, disposed of or discontinued shall not exceed $1.0
          billion (as determined as of the Effective Time).  For purposes of the
          preceding sentence and clause (d)(ii), asset retirements, sale-
          leaseback arrangements and discontinuances of product lines within

                                      -14-

 
          a trade or business the active conduct of which is continued shall not
          be deemed a liquidation, disposition or discontinuance of a trade or
          business or portion thereof.

               (iv) Solely for purposes of this Section 4.2(d), Hughes shall not
          be treated as directly or indirectly controlling a Subsidiary unless
          Hughes owns, directly or indirectly, shares of capital stock of such
          Subsidiary constituting (i) 80% or more of the total combined voting
          power of all outstanding shares of Voting Stock of such Subsidiary and
          (ii) 80% or more of the total number of outstanding shares of each
          class or series of capital stock of such Subsidiary other than Voting
          Stock.

               (v) The restrictions contained in this Section 4.2(d) shall apply
          only to the businesses, subsidiaries and operations of Hughes as in
          existence prior to the Effective Time, and shall not be deemed to
          apply to those businesses, subsidiaries and operations conducted by
          Raytheon prior to the Effective Time.

          (e)  Continuity of Business.

               (i) Until the first day after the two-year anniversary of the
          Effective Time, (A) Hughes shall not voluntarily dissolve or
          liquidate, and (B) except in the ordinary course of business, neither
          Hughes nor any Subsidiaries directly or indirectly controlled by
          Hughes shall sell, transfer, or otherwise dispose of or agree to
          dispose of assets (including, for such purpose, any shares of capital
          stock of such Subsidiaries) that, in the aggregate, constitute more
          than (x) 60% of the gross assets of Hughes or (y) 60% of the
          consolidated gross assets of Hughes and such Subsidiaries, unless
          prior to the consummation of such transaction GM has determined, in
          its sole and absolute discretion, which discretion shall be exercised
          in good faith solely to preserve the Tax-Free Status of the Spin-Offs
          and the Tax-Free Status of the Hughes Merger, that such transaction
          would not jeopardize the Tax-Free Status of the Spin-Offs or the Tax-
          Free Status of the Hughes Merger.  The amount of gross assets of
          Hughes and such Subsidiaries shall be based on the fair market value
          of each such asset as of the Effective Time.

               (ii) Sales, transfers or other dispositions by Hughes or any of
          its Subsidiaries to Hughes or one or more Subsidiaries directly or
          indirectly controlled by Hughes shall not be included in any
          determinations under this Section 4.2(e) of whether such 60% or more
          of the gross assets of Hughes or 60% of the consolidated gross assets
          of Hughes and such Subsidiaries have been sold, transferred or
          otherwise disposed of.

               (iii)  Solely for purposes of this Section 4.2(e), Hughes shall
          not be treated as directly or indirectly controlling a Subsidiary
          unless Hughes owns, directly or indirectly, shares of capital stock of
          such Subsidiary constituting (A) 80% or more of the total combined
          voting power of all outstanding shares of Voting Stock of such
          Subsidiary and (B) 80% or more of the total number of outstanding
          shares of each class or series of capital stock of such Subsidiary
          other than Voting Stock.

                                      -15-

 
               (iv) The restrictions contained in this Section 4.2(e) shall
          apply only to the businesses, subsidiaries and operations of Hughes as
          in existence prior to the Effective Time, and shall not be deemed to
          apply to those businesses, subsidiaries and operations conducted by
          Raytheon prior to the Effective Time.

          (f) Recapitalizations, Reincorporations and Similar Transactions.

               (i) Hughes shall not propose a plan of recapitalization or
          amendment to its charter or other action providing for (A) the
          conversion of shares of any class of Hughes Common Stock into a
          different class of Hughes Capital Stock, (B) a change in the absolute
          or relative voting rights of any class of Hughes Common Stock from the
          rights existing at the Effective Time, or (C) any other action having
          an effect similar to that described in clause (A) or (B), unless prior
          to the consummation of such action GM has determined, in its sole and
          absolute discretion, which discretion shall be exercised in good faith
          solely to preserve the Tax-Free Status of the Spin-Offs and the Tax-
          Free Status of the Hughes Merger, that such action would not
          jeopardize the Tax-Free Status of the Spin-Offs or the Tax-Free Status
          of the Hughes Merger.

               (ii) A Proposed Acquisition Transaction will be considered a
          recapitalization transaction subject to subsection 4.2(f)(i) if, as a
          result of such transaction, holders of Hughes Common Stock immediately
          before the Proposed Acquisition Transaction will own more than 50% of
          the common equity of the Person (or group of related Persons)
          acquiring the Hughes Capital Stock immediately after consummation of
          the Proposed Acquisition Transaction, and, in such case, the Person
          acquiring Hughes Capital Stock pursuant to a Proposed Acquisition
          Transaction shall be treated as if such Person were Hughes for
          purposes of this Section 4.2(f).

          (g) Miscellaneous.  Until the first day after the two-year anniversary
     of the Effective Time, Hughes shall not take, or permit any of its
     Subsidiaries to take, any other actions or enter into any transaction or
     series of transactions or agree to enter into any other transactions that
     would be reasonably likely to jeopardize the Tax-Free Status of the Spin-
     Offs or the Tax-Free Status of the Hughes Merger, including any action or
     transaction that would be reasonably likely to be inconsistent with any
     representation made in the Representation Letters, unless prior to the
     consummation of such action or transaction GM has determined, in its sole
     and absolute discretion, which discretion shall be exercised in good faith
     solely to preserve the Tax-Free Status of the Spin-Offs and the Tax-Free
     Status of the Hughes Merger, that such action or transaction would not
     jeopardize the Tax-Free Status of the Spin-Offs or the Tax-Free Status of
     the Hughes Merger.  Notwithstanding the foregoing, if and to the extent
     that any action or transaction is described in and permitted pursuant to
     Sections 4.2(a)-(f) such action or transaction shall not be prohibited by
     this Section 4.2(g).

                                      -16-

 
          (h) Permitted Actions and Transactions.  Notwithstanding the
     foregoing, the provisions of Section 4.2 shall not prohibit Hughes from (i)
     implementing, or otherwise complying with the provisions of, any
     stockholders rights plan of Hughes, (ii) consummating the Hughes Merger or
     any of the GM Transactions, provided that the conditions to closing set
     forth in Sections 6.1 and 6.3 of the Hughes Merger Agreement have been
     satisfied or properly waived and (iii) implementing any transaction upon
     which the IRS has granted a favorable ruling in, or which is described in
     reasonable detail in, any Tax Opinions/Ruling received from the IRS.

      4.3  Cooperation and Other Covenants.

          (a) Notice of Subsequent Hughes Actions.  Each of Hughes and GM shall
     furnish the other with a copy of any ruling requests or other documents
     delivered to the IRS that relates to the Hughes Spin-Off, Telecom Spin-Off
     or the Hughes Merger or that could otherwise be reasonably expected to have
     an impact on the Tax-Free Status of the Spin-Offs or Tax-Free Status of the
     Hughes Merger.

          (b)  Cooperation.

               (i) Each of Hughes and GM shall cooperate with the other and
          shall take (or refrain from taking) all such actions as the other may
          reasonably request in connection with obtaining any GM determination
          referred to in Section 4.2.  Such cooperation shall include, without
          limitation, providing any information and/or representations
          reasonably requested by the other to enable either party (or counsel
          for such party) to obtain and maintain any Subsequent Tax
          Opinion/Ruling that would permit any action described in Section 4.2
          to be taken by Hughes or a Hughes Affiliate.  From and after any
          Representation Date in connection with obtaining any such
          determination or the receipt of a Subsequent Tax Opinion/Ruling and
          until the first day after the two-year anniversary of the date of such
          determination or receipt, neither party shall take (nor shall it
          refrain from taking) any action that would have caused such
          representation to be untrue unless the other party has determined, in
          its sole and absolute discretion, which discretion shall be exercised
          in good faith solely to preserve the Tax-Free Status of the Spin-Offs
          and the Tax-Free Status of the Hughes Merger, that such action would
          not jeopardize the Tax-Free Status of the Spin-Offs and the Tax-Free
          Status of the Hughes Merger.

               (ii) In the event that Hughes notifies GM that it desires to take
          one of the actions described in this Section 4.2 and GM concludes that
          such action would jeopardize the Tax-Free Status of the Spin-Offs or
          the Tax-Free Status of the Hughes Merger, GM shall, at the request of
          Hughes, elect either to (i) use all commercially reasonable efforts to
          obtain a Subsequent Tax Opinion/Ruling that would permit Hughes to
          take the specified action, and Hughes shall cooperate in connection
          with such efforts, or (ii) provide all reasonable cooperation to
          Hughes in connection with Hughes obtaining such a Subsequent Tax
          Opinion/Ruling in form and substance reasonably satisfactory to GM;
          provided, however, that the reasonable costs and

                                      -17-

 
          expenses of obtaining any such Subsequent Tax Opinion/Ruling shall be
          borne by Hughes.

          (c)  Notice.

               (i) Until all restrictions set forth in Section 4.2 have expired,
          Hughes shall give GM written notice of any intention to effect or
          permit an action or transaction described in Section 4.2 and which is
          prohibited thereunder at such time within a period of time reasonably
          sufficient to enable GM to make the determination referred to in
          Section 4.2 or to prepare and seek any Subsequent Tax Opinion/Ruling
          in connection with such proposed action or transaction.  Each such
          notice shall set forth the terms and conditions of the proposed action
          or transaction, including, without limitation, as applicable, the
          nature of any related action proposed to be taken by the Board of
          Directors of Hughes, the approximate number of shares of Hughes
          Capital Stock proposed to be transferred or issued, the approximate
          value of Hughes' assets (or assets of any of Hughes' Subsidiaries)
          proposed to be transferred, the proposed timetable for such action or
          transaction, and the number of shares of Hughes Capital Stock
          otherwise then owned by the other party to the proposed action or
          transaction, all with sufficient particularity to enable GM to make
          any such required determination, including information required to
          prepare and seek a Subsequent Tax Opinion/Ruling in connection with
          such proposed action or transaction. All information provided by
          Hughes to GM pursuant to this Section 4.3 shall be deemed subject to
          the confidentiality obligations of Article 4 of the Separation
          Agreement.

               (ii) Promptly, but in any event within 15 days, after GM receives
          such written notice from Hughes, GM shall evaluate such information
          and notify Hughes in writing of such determination or of GM's intent
          to seek a Subsequent Tax Opinion/ Ruling and the proposed date for
          submission of the request therefor, which date shall not be more than
          45 days after the date GM so notifies Hughes of GM's intent to seek a
          Subsequent Tax Opinion/Ruling, provided that such 45-day period shall
          be appropriately extended for any period of noncompliance by Hughes
          with Section 4.3(b). GM shall notify Hughes promptly, but in any event
          within two Business Days, after the receipt of a Subsequent Tax
          Opinion/Ruling.  If GM makes a determination that an action or
          transaction described in Section 4.2 would jeopardize the Tax-Free
          Status of the Spin-Offs or Tax-Free Status of the Hughes Merger, such
          notice to Hughes shall set forth, in reasonable detail, the reasons
          therefor and the reasons for not receiving a Subsequent Tax
          Opinion/Ruling.

      4.4  Indemnification for Tax Liabilities.

          (a) General.  Notwithstanding any other provision of this Agreement or
     any provision of any of the Tax Agreement to the contrary but subject to
     Section 4.4(b), Hughes shall indemnify, defend and hold harmless GM and
     each GM Affiliate (or any successor to any of them) against any and all
     Tax-Related Losses incurred by GM in connection with any

                                      -18-

 
     proposed tax assessment or tax controversy with respect to the Hughes Spin-
     Off or the Hughes Merger to the extent caused by any breach by Hughes of
     any of its representations, warranties or covenants made pursuant to this
     Agreement. All interest or penalties incurred in connection with such Tax-
     Related Losses shall be computed for the time period up to and including
     the date that Hughes pays its indemnification obligation in full.

          (b) Exceptions to Hughes' Indemnification.  If GM (i) makes a
     determination pursuant to any clause of Section 4.2, on the basis of a
     Subsequent Tax Opinion/Ruling or otherwise, and (ii) delivers to Hughes
     written notice of such determination pursuant to Section 4.3(c), Hughes
     shall have no obligation pursuant to Section 4.4(a), except to the extent
     that any Tax-Related Losses so incurred resulted from the inaccuracy,
     incorrectness or incompleteness of any representation provided by Hughes
     upon which such Subsequent Tax Opinion/Ruling and/or determination was
     based.

          (c) Timing and Method of Tax Indemnification Payments.  Hughes shall
     pay any amount due and payable to GM pursuant to this Section 4.4 on or
     before the 90th day following the earlier of agreement or determination
     that such amount is due and payable to GM. All payments pursuant to this
     Section 4.4 shall be made by wire transfer to the bank account designated
     by GM for such purpose, and on the date of such wire transfer Hughes shall
     give GM notice of the transfer.

     4.5  Procedure for Indemnification for Tax Liabilities.

          (a) Notice of Claim.  If GM receives notice of the assertion of any
     Third-Party Claim with respect to which Hughes may be obligated under
     Section 4.4 to provide indemnification, GM shall give Hughes notice thereof
     (together with a copy of such Third-Party Claim, process or other legal
     pleading) promptly after becoming aware of such Third-Party Claim;
     provided, however, that the failure of GM to give notice as provided in
     this Section shall not relieve Hughes of its obligations under Section 4.4,
     except to the extent that Hughes is actually prejudiced by such failure to
     give notice.  Such notice shall describe such Third-Party Claim in
     reasonable detail.

          (b) Obligation of Indemnifying Party.

               (i) GM and Hughes shall jointly control the defense of, and
          cooperate with each other with respect to defending, any Third-Party
          Claim with respect to which Hughes is obligated under Section 4.4 to
          provide indemnification, provided that Hughes shall forfeit such joint
          control right with respect to a particular Third-Party Claim if Hughes
          or any Hughes Affiliate makes any public statement or filing, or takes
          any action (including, but not limited to, the filing of any
          submission or pleading, or the giving of a deposition or production of
          documents, in any administrative or court proceeding) in connection
          with such Third-Party Claim that is inconsistent in a material respect
          with any representation or warranty made by Hughes in the Agreement,
          the Tax Opinions/Rulings, the Representation Letters or the Hughes
          Merger Agreement.

                                      -19-

 
               (ii) Hughes and GM shall exercise their rights to jointly control
          the defense of any such Third-Party Claim solely for the purpose of
          defeating such Third-Party Claim and, unless required by applicable
          law, neither Hughes nor GM shall make any statements or take any
          actions that could reasonably result in the shifting of liability for
          any Losses arising out of such Third-Party Claim from the party making
          such statement or taking such action (or any of its Affiliates) to the
          other party (or any of its Affiliates).

               (iii)  Statements made or actions taken by either Hughes or GM in
          connection with the defense of any such Third-Party Claim shall not
          prejudice the rights of such party in any subsequent action or
          proceeding between the parties.

               (iv) If either GM or Hughes fails to jointly defend any such
          Third-Party Claim, the other party shall solely defend such Third-
          Party Claim and the party failing to jointly defend shall use
          commercially reasonable efforts to cooperate with the other party in
          its defense of such Third-Party Claim; provided, however, that GM may
          not compromise or settle any such Third-Party Claim without the prior
          written consent of Hughes, which consent shall not be unreasonably
          withheld or delayed. All costs and expenses of either party in
          connection with, and during the course of, the joint control of the
          defense of any such Third-Party Claim shall be initially paid by the
          party that incurs such costs and expenses.  Such costs and expenses
          shall be reallocated and reimbursed in accordance with the respective
          indemnification obligations of the parties at the conclusion of the
          defense of such Third-Party Claim.

      4.6  Arbitration.   Any dispute between the parties arising out of or
relating to this Section 4, including the interpretation of this Section 4, or
any actual or purported breach of this Section 4, shall be resolved only in
accordance with the following provisions:

          (a) Negotiation.  GM and Hughes shall attempt in good faith to resolve
     any such dispute promptly through negotiations of the parties.  In the
     event of any such dispute, either party may deliver a Dispute Notice to the
     other party, and within 20 Business Days after the receipt of such Dispute
     Notice, the appropriate representatives of GM and Hughes shall meet to
     attempt to resolve such dispute.  If such dispute has not been resolved
     within the Negotiation Period, or if one of the parties fails or refuses to
     negotiate such dispute, the issue shall be settled by arbitration pursuant
     to Section 4.6(b). The results of such arbitration shall be final and
     binding on the parties.

          (b) Arbitration Procedure.  Either party may initiate arbitration with
     regard to such dispute by giving the other party written notice either (i)
     at any time following the end of the Negotiation Period, or (ii) if the
     parties do not meet within 20 Business Days of the receipt of the Dispute
     Notice, at any time thereafter.  The arbitration shall be conducted by
     three arbitrators in accordance with the CPR Rules, except as otherwise
     provided in this Section 4.6. Within 20 days following receipt of the
     written notice of arbitration, GM and Hughes shall each appoint one
     arbitrator.  The two arbitrators so appointed shall appoint the third
     arbitrator.  If either GM or Hughes shall fail to appoint an arbitrator
     within such 20-day

                                      -20-

 
     period, the arbitration shall be by the sole arbitrator appointed by the
     other party.  Whether selected by GM and Hughes or otherwise, each
     arbitrator selected to resolve such dispute shall be a tax attorney who is
     generally recognized in the tax community as a qualified and competent tax
     practitioner with experience in the tax area involved in the issue or
     issues to be resolved.  Such arbitrators shall be empowered to determine
     whether Hughes is required to indemnify GM pursuant to Section 4.4 and to
     determine the amount of the related indemnification payment.  Each of GM
     and Hughes shall bear 50% of the aggregate expenses of the arbitrators.
     The arbitration shall be governed by the United States Arbitration Act, 9
     U.S.C. (S)(S)1-14. The place of arbitration shall be New York, New York.
     The final decision of the arbitrators shall be rendered no later than one
     year from the date of the written notice of arbitration.

      4.7  Exclusive Remedies. Except for the right to pursue equitable
remedies, the remedies provided in this Section 4 shall be deemed the sole and
exclusive remedies of the parties with respect to the subject matters of the
indemnification provisions of Section 4.4.

 5.  Indemnification.
     --------------- 

      5.1  Indemnification by Hughes.  Subject to Section 5.3, from and after
the Effective Time, Hughes shall indemnify, defend and hold harmless GM, all GM
Affiliates and each of their respective directors, officers and employees (in
their capacities as such), from and against:

          (a) all Losses relating to, arising out of, or due to, directly or
     indirectly, any breach by Hughes or any Hughes Affiliate of any of the
     provisions of this Agreement;

          (b) all Losses relating to, arising out of, or due to any untrue
     statement or alleged untrue statement of a material fact contained in the
     Hughes Disclosure Portions or the omission or alleged omission to state in
     the Hughes Disclosure Portions a material fact required to be stated
     therein or necessary to make the statements therein not misleading; and

          (c) all Losses relating to or arising out of actions taken (or omitted
     to be taken) by Raytheon or any Raytheon Affiliate in violation of the
     Hughes Merger Agreement.

      5.2  Indemnification by GM.  Subject to Section 5.3, from and after the
Effective Time, GM shall indemnify, defend, and hold harmless Hughes, all Hughes
Affiliates, and each of their respective directors, officers and employees (in
their capacities as such), from and against:

          (a) all Losses relating to, arising out of, or due to, directly or
     indirectly, any breach by GM or any GM Affiliate of any of the provisions
     of this Agreement;

          (b) all Losses relating to, arising out of, or due to any untrue
     statement or alleged untrue statement of a material fact contained in the
     GM Disclosure Portions or the omission or alleged omission to state in the
     GM Disclosure Portions a material fact required to be stated therein or
     necessary to make the statements therein not misleading; and

                                      -21-

 
          (c) all Losses relating to or arising out of any breach of the
     representation set forth in Section 2.4(a) of the Implementation Agreement.

      5.3 Other Liabilities.  (a)   Except as provided in Section 5.4, this
Section 5 shall not be applicable to any Tax-Related Losses, which shall be
governed by Section 4 of this Agreement.

     (b) This Section 5 shall not be applicable to any Losses relating to,
arising out of, or due to any breach of the provisions of any other contract,
agreement or understanding between GM or any GM Affiliate and Hughes or any
Hughes Affiliate, which Losses shall be governed by the terms of such contract,
agreement or understanding.

      5.4 Tax Effects of Indemnification.    (a)  Any indemnification payment
made under this Agreement shall be characterized for tax purposes as if such
payment were made immediately prior to the Effective Time, and shall therefore
be treated, to the extent permitted by law, as either (i) a distribution from
Hughes to GM or (ii) a capital contribution from GM to Hughes.

     (b) The amount of any Loss or Tax-Related Losses for which indemnification
is provided under this Agreement shall be (i) increased to take account of net
Tax cost, if any, incurred by the Indemnitee arising from the receipt or accrual
of an Indemnity Payment hereunder (grossed up for such increase) and (ii)
reduced to take account of net Tax benefit, if any, realized by the Indemnitee
arising from incurring or paying such Loss or Tax-Related Losses.  In computing
the amount of any such Tax cost or Tax benefit, the Indemnitee shall be deemed
to recognize all other items of income, gain, loss, deduction or credit before
recognizing any item arising from the receipt or accrual of any Indemnity
Payment hereunder or incurring or paying any indemnified Loss or Tax-Related
Losses. Any Indemnity Payment hereunder shall initially be made without regard
to this Section 5.4 and shall be increased or reduced to reflect any such net
Tax cost (including gross-up) or net Tax benefit only after the Indemnitee has
actually realized such cost or benefit.  For purposes of this Agreement, an
Indemnitee shall be deemed to have 'actually realized' a net Tax cost or a net
Tax benefit to the extent that, and at such time as, the amount of Taxes payable
by such Indemnitee is increased above or reduced below, as the case may be, the
amount of Taxes that such Indemnitee would be required to pay but for the
receipt or accrual of the Indemnity Payment or the incurrence or payment of such
Loss or Tax-Related Losses, as the case may be.  The amount of any increase or
reduction hereunder shall be adjusted to reflect any final determination (which
shall include the execution of Form 870-AD or successor form) with respect to
the Indemnitee's liability for Taxes, and payments between GM and Hughes to
reflect such adjustment shall be made if necessary.
 
      5.5  Effect of Insurance Upon Indemnification.  The amount which an
Indemnifying Party is required to pay to any Indemnitee pursuant to this Section
5 shall be reduced (including retroactively) by any Insurance Proceeds and other
amounts actually recovered by such Indemnitee in reduction of the related Loss,
it being understood and agreed that each of Hughes and GM shall use commercially
reasonable efforts to collect any such proceeds or other amounts to which it or
any of its Affiliates is entitled, without regard to whether it is the
Indemnifying Party hereunder.  No Indemnitee shall be required, however, to
collect any such proceeds or other amounts prior to being entitled to
indemnification from an Indemnifying Party hereunder.  If an Indemnitee receives
an

                                      -22-

 
Indemnity Payment in respect of a Loss and subsequently receives Insurance
Proceeds or other amounts in respect of such Loss, then such Indemnitee shall
pay to such Indemnifying Party an amount equal to the difference between (a) the
sum of the amount of such Indemnity Payment and the amount of such Insurance
Proceeds or other amounts actually received and (b) the amount of such Loss, in
each case adjusted (at such time as appropriate adjustment can be determined) to
reflect any premium adjustment attributable to such claim.

      5.6  Procedure for Indemnification Involving Third-Party Claims.

          (a) Notice of Claim.  If any Indemnitee receives notice of the
     assertion of any Third-Party Claim with respect to which an Indemnifying
     Party is obligated under this Agreement to provide indemnification (other
     than pursuant to Section 4), such Indemnitee shall give such Indemnifying
     Party notice thereof (together with a copy of such Third-Party Claim,
     process or other legal pleading) promptly after becoming aware of such
     Third-Party Claim; provided, however, that the failure of any Indemnitee to
     give notice as provided in this Section shall not relieve any Indemnifying
     Party of its obligations under this Section 5, except to the extent that
     such Indemnifying Party is actually prejudiced by such failure to give
     notice.  Such notice shall describe such Third-Party Claim in reasonable
     detail.

          (b) Obligation of Indemnifying Party.  An Indemnifying Party, at such
     Indemnifying Party's own expense and through counsel chosen by such
     Indemnifying Party (which counsel shall be reasonably acceptable to the
     Indemnitee), may elect to defend any Third-Party Claim.  If an Indemnifying
     Party elects to defend a Third-Party Claim, then, within ten Business Days
     after receiving notice of such Third-Party Claim (or sooner, if the nature
     of such Third-Party Claim so requires), such Indemnifying Party shall
     notify the Indemnitee of its intent to do so, and such Indemnitee shall
     cooperate in the defense of such Third-Party Claim.  Such Indemnifying
     Party shall pay such Indemnitee's reasonable out-of-pocket expenses
     incurred in connection with such cooperation.  Such Indemnifying Party
     shall keep the Indemnitee reasonably informed as to the status of the
     defense of such Third-Party Claim.  After notice from an Indemnifying Party
     to an Indemnitee of its election to assume the defense of a Third-Party
     Claim, such Indemnifying Party shall not be liable to such Indemnitee under
     this Section 5 for any legal or other expenses subsequently incurred by
     such Indemnitee in connection with the defense thereof other than those
     expenses referred to in the preceding sentence; provided, however, that
     such Indemnitee shall have the right to employ one law firm as counsel,
     together with a separate local law firm in each applicable jurisdiction
     ('Separate Counsel'), to represent such Indemnitee in any action or group
     of related actions (which firm or firms shall be reasonably acceptable to
     the Indemnifying Party) if, in such Indemnitee's reasonable judgment at any
     time, either a conflict of interest between such Indemnitee and such
     Indemnifying Party exists in respect of such claim, or there may be
     defenses available to such Indemnitee which are different from or in
     addition to those available to such Indemnifying Party and the
     representation of both parties by the same counsel would be inappropriate,
     and in that event (i) the reasonable fees and expenses of such Separate
     Counsel shall be paid by such Indemnifying Party (it being understood,
     however, that the Indemnifying Party shall not be liable for the expenses
     of more than one Separate Counsel (excluding local counsel) with respect to
     any Third-Party Claim (even if

                                      -23-

 
     against multiple Indemnitees)) and (ii) each of such Indemnifying Party and
     such Indemnitee shall have the right to conduct its own defense in respect
     of such claim.  If an Indemnifying Party elects not to defend against a
     Third-Party Claim, or fails to notify an Indemnitee of its election as
     provided in this Section 5 within the period of ten Business Days described
     above, the Indemnitee may defend, compromise, and settle such Third-Party
     Claim and shall be entitled to indemnification hereunder (to the extent
     permitted hereunder); provided, however, that no such Indemnitee may
     compromise or settle any such Third-Party Claim without the prior written
     consent of the Indemnifying Party, which consent shall not be unreasonably
     withheld or delayed.  Notwithstanding the foregoing, the Indemnifying Party
     shall not, without the prior written consent of the Indemnitee, (i) settle
     or compromise any Third-Party Claim or consent to the entry of any judgment
     which does not include as an unconditional term thereof the delivery by the
     claimant or plaintiff to the Indemnitee of a written release from all
     liability in respect of such Third-Party Claim or (ii) settle or compromise
     any Third-Party Claim in any manner that would be reasonably likely to have
     a material adverse effect on the Indemnitee.

          (c) Joint Defense of Certain Claims.  Notwithstanding the provisions
     of Section 5.6(b), GM and Hughes shall jointly control the defense of, and
     cooperate with each other with respect to defending, any Third-Party Claim
     with respect to which each party is claiming that it is entitled to
     indemnification under Section 5.1 or 5.2. If either GM or Hughes fails to
     defend jointly any such Third-Party Claim, the other party shall solely
     defend such Third-Party Claim and the party failing to defend jointly shall
     use all commercially reasonable efforts to cooperate with the other party
     in its defense of such Third-Party Claim; provided, however, that neither
     party may compromise or settle any such Third-Party Claim without the prior
     written consent of the other party, which consent shall not be unreasonably
     withheld or delayed.  All costs and expenses of either party in connection
     with, and during the course of, the joint control of the defense of any
     such Third-Party Claim shall be initially paid by the party that incurs
     such costs and expenses.  Such costs and expenses shall be reallocated and
     reimbursed in accordance with the respective indemnification obligations of
     the parties at the conclusion of the defense of such Third-Party Claim.

      5.7  Procedure for Indemnification Not Involving Third-Party Claims.  If
any Indemnitee desires to assert against an Indemnifying Party any claim for
indemnification under this Section 5 other than a Third-Party Claim (a 'Claim'),
the Indemnitee shall deliver to the Indemnifying Party notice of its demand for
satisfaction of such Claim (a 'Request'), specifying in reasonable detail the
amount of such Claim and the basis for asserting such Claim.  Within 30 days
after the Indemnifying Party has been given a Request, the Indemnifying Party
shall either (i) satisfy the Claim requested to be satisfied in such Request by
delivering to the Indemnitee payment by wire transfer or a certified or bank
cashier's check payable to the Indemnified Party in immediately available funds
in an amount equal to the amount of such Claim, or (ii) notify the Indemnitee
that the Indemnifying Party contests such Claim by delivering to the Indemnitee
a Dispute Notice, stating that the Indemnifying Party objects to such Claim and
specifying in reasonable detail the basis for contesting such Claim.  Any
dispute described in clause (ii) of this Section 5.7 shall be subject to the
provisions of Section 6.1.

                                      -24-

 
      5.8  Exclusive Remedies.  Except for the right to pursue equitable
remedies, the remedies provided in this Section 5 shall be deemed the sole and
exclusive remedies of the parties with respect to the subject matters of the
indemnification provisions of this Section 5.

 6.  Miscellaneous.
     ------------- 

      6.1  Dispute Resolution.  GM and Hughes shall attempt in good faith to
resolve any dispute between the parties arising out of or relating to this
Agreement promptly through negotiations of the parties prior to seeking any
other legal or equitable remedy.

      6.2  Survival.  The representations and warranties contained in this
Agreement shall survive the effective time of the Hughes Merger until the
expiration of all applicable statutes of limitations.

      6.3  Complete Agreement.  Except as otherwise set forth in this Agreement,
this Agreement and the exhibits and schedules hereto shall constitute the entire
agreement between the parties hereto with respect to the subject matter hereof
and shall supersede all prior and contemporaneous agreements and understandings,
whether written or oral, between the parties with respect to such subject
matter.

      6.4  Authority.  Each of the parties hereto represents to the other that
(a) it has the corporate power and authority to execute, deliver and perform
this Agreement, (b) the execution, delivery and performance of this Agreement by
it has been duly authorized by all necessary corporate action, (c) it has duly
and validly executed and delivered this Agreement, and (d) this Agreement is a
legal, valid and binding obligation, enforceable against it in accordance with
its terms subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting creditors' rights generally and
general equity principles.

      6.5  Governing Law.  This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware (other than the laws regarding
conflicts of laws) as to all matters, including matters of validity,
construction, effect, performance and remedies.

      6.6  Consent to Exclusive Jurisdiction.  Any action, suit or proceeding
arising out of any claim that the parties cannot settle through good faith
negotiations (except any claim to which Section 4.6 applies) shall be litigated
exclusively in the state courts of Delaware.  Each of the parties hereto hereby
irrevocably and unconditionally (a) submits to the jurisdiction of the state
courts of Delaware for any such action, suit or proceeding, (b) agrees not to
commence any such action, suit or proceeding except in the state courts of
Delaware, (c) waives, and agrees not to plead or to make, any objection to the
venue of any such action, suit or proceeding in the state courts of Delaware,
(d) waives, and agrees not to plead or to make, any claim that any such action,
suit or proceeding brought in the state courts of Delaware has been brought in
an improper or otherwise inconvenient forum, (e) waives, and agrees not to plead
or to make, any claim that the state courts of Delaware lack personal
jurisdiction over it, and (f) waives its right to remove any such action, suit
or proceeding to the federal courts except when such courts are vested with sole
and exclusive jurisdiction by statute.  GM and Hughes shall cooperate with each
other in connection with any such

                                      -25-

 
action, suit or proceeding to obtain reliable assurances that confidential
treatment will be accorded any information that either party shall reasonably
deem to be confidential or proprietary.  Each of the parties hereto irrevocably
designates and appoints its respective Service Agent as its agent to receive
service of process in any such action, suit or proceeding.  Each of the parties
hereto further covenants and agrees that, until the expiration of all applicable
statutes of limitations relating to potential claims under this Agreement, each
such party shall maintain a duly appointed agent for the service of summonses
and other legal process in the State of Delaware, and shall promptly notify the
other party hereto of any change in the name or address of its Service Agent and
the name and address of any replacement for its Service Agent, if such agent is
no longer the Service Agent named herein.  This Section 6.6 is meant to comply
with 6 Del. C. (S) 2708.

      6.7  Notices.  All Notices shall be in writing and shall be deemed given
upon (a) a transmitter's confirmation of a receipt of a facsimile transmission
(but only if followed by confirmed delivery of a standard overnight courier the
following Business Day or if delivered by hand the following Business Day), or
(b) confirmed delivery of a standard overnight courier or delivered by hand, to
the parties at the following addresses:

          if to GM to:

               General Motors Corporation
               767 Fifth Avenue
               New York, NY 10153
               Attention:  Treasurer
               Telecopy No.:  (212) 418-3630

               with a copy to:

               General Motors Corporation
               3031 West Grand Boulevard
               Detroit, MI 48202
               Attention:  Warren G. Andersen, Esq.
               Telecopy No.:  (313) 974-0685

               with a copy (which shall not constitute effective notice) to:

               Kirkland & Ellis
               200 E. Randolph Drive
               Chicago, IL 60601
               Attention:  Robert S. Osborne, P.C.
               Telecopy No.:  (312) 861-2200

               and with a copy (which shall not constitute effective notice) to:

               Weil, Gotshal & Manges LLP
               767 Fifth Avenue

                                      -26-

 
               New York, NY 10153
               Attention:  Frederick S. Green, Esq.
               Telecopy No.:  (212) 310-8007

          if to Hughes, to:

               HE Holdings, Inc.
               c/o Raytheon Company
               141 Spring Street
               Lexington, MA 02173
               Attention: Christoph L. Hoffmann, Esq.
               Telecopy No.:  (617) 860-2822

               with a copy (which shall not constitute effective notice) to:

               Wachtell, Lipton, Rosen & Katz
               51 West 52nd Street
               New York, NY 10019
               Attention:  Adam O. Emmerich, Esq.
               Telecopy No.:  (212) 403-2000

or to such other address as either party hereto may have furnished to the other
party by a Notice in writing in accordance with this Section 6.7.  Any Notice
delivered pursuant to Section 4 shall also be sent to GM's Chief Tax Officer.

      6.8  Amendment and Modification.  This Agreement may not be amended or
modified in any respect except by a written agreement signed by both of the
parties hereto.

      6.9  Binding Effect; Assignment.  This Agreement and all of the provisions
hereof shall be binding upon the parties hereto and inure to the benefit of the
parties hereto and their respective successors and permitted assigns.  Except
with respect to a merger of either party with another Person, neither this
Agreement nor any of the rights, interests or obligations hereunder shall be
assigned by either party hereto without the prior written consent of the other
party, which consent shall not be unreasonably withheld or delayed.

      6.10  Third Party Beneficiaries.  The Indemnitees and their respective
successors shall be third party beneficiaries of the indemnification provisions
of Sections 4 and 5, as applicable, and shall be entitled to enforce those
provisions, and in connection with such enforcement shall be subject to Section
6.6, in each such case as fully and to the same extent as if they were parties
to this Agreement.  Except as provided in the previous sentence, nothing in this
Agreement, express or implied, is intended to or shall confer upon any Person
any legal or equitable right, benefit or remedy of any nature whatsoever under
or by reason of this Agreement, and no Person (other than as provided in the
previous sentence) shall be deemed a third party beneficiary under or by reason
of this Agreement.

                                      -27-

 
      6.11  Counterparts.  This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

      6.12  Waiver.  The observance of any term of this Agreement may be
waived (either generally or in a particular instance and either retroactively or
prospectively) by the party entitled to enforce such term, but such waiver shall
be effective only if it is in writing signed by the party against which such
waiver is to be asserted.  Unless otherwise expressly provided in this
Agreement, no delay or omission on the part of any party in exercising any right
or privilege under this Agreement shall operate as a waiver thereof, nor shall
any waiver on the part of any party of any right or privilege under this
Agreement operate as a waiver of any other right or privilege under this
Agreement nor shall any single or partial exercise of any right or privilege
preclude any other or further exercise thereof or the exercise of any other
right or privilege under this Agreement.  No failure by either party to take any
action or assert any right or privilege hereunder shall be deemed to be a waiver
of such right or privilege in the event of the continuation or repetition of the
circumstances giving rise to such right unless expressly waived in writing by
the party against whom the existence of such waiver is asserted.

      6.13  Severability.  Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof. Any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

      6.14  Remedies.  Each of GM and Hughes shall be entitled to enforce its
rights under this Agreement specifically, to recover damages and costs
(including reasonable attorneys' fees) caused by any breach of any provision of
this Agreement and to exercise all other rights existing in its favor. Each of
GM and Hughes acknowledges and agrees that under certain circumstances the
breach by GM or any of its Affiliates or Hughes or any of its Affiliates of a
term or provision of this Agreement will materially and irreparably harm the
other party, that money damages will accordingly not be an adequate remedy for
such breach and that the non-defaulting party, in its sole discretion and in
addition to its rights under this Agreement and any other remedies it may have
at law or in equity, may apply to any court of law or equity of competent
jurisdiction (without posting any bond or deposit) for specific performance
and/or other injunctive relief in order to enforce or prevent any breach of the
provisions of this Agreement.

      6.15  Performance.  Each of the parties hereto shall use all commercially
reasonable efforts to cause to be performed all actions, agreements and
obligations set forth herein to be performed by any Affiliate of such party.

      6.16  References; Construction.  The table of contents and the section
and other headings and subheadings contained in this Agreement and the Exhibits
hereto are solely for the purpose of reference, are not part of the agreement of
the parties hereto, and shall not in any way affect the meaning or
interpretation of this Agreement.  All references to days or months shall be
deemed references to calendar days or months.  All references to '$' shall be
deemed references to

                                      -28-

 
United States dollars.  Unless the context otherwise requires, any reference to
a 'Section' or 'Exhibit' shall be deemed to refer to a section of this Agreement
or an exhibit to this Agreement. The words 'hereof,' 'herein' and 'hereunder'
and words of similar import referring to this Agreement refer to this Agreement
as a whole and not to any particular provision of this Agreement. Whenever the
words 'include,' 'includes' or 'including' are used in this Agreement, unless
otherwise specifically provided, they shall be deemed to be followed by the
words 'without limitation.'  This Agreement shall be construed without regard to
any presumption or rule requiring construction or interpretation against the
party drafting or causing the document to be drafted.

                                *  *  *  *  *  *

                                      -29-

 
     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the date and year first written above.


                                        HE HOLDINGS, INC.


                                        By:________________________________
                                           Name:
                                           Its:


                                        GENERAL MOTORS CORPORATION


                                        By:________________________________
                                           Name:
                                           Its: