Exchange Offers Intended to Reduce Aggregate
Indebtedness and Materially Extend Debt Maturity Profile Providing
Significant Runway for Continued Strategic Investment and
Opportunity to Combine DISH Network's satellite technology,
streaming services and nationwide 5G network with EchoStar's
premier satellite communications solutions, creating a global
leader in terrestrial and non-terrestrial wireless
connectivity
ENGLEWOOD, Colo., Jan. 12,
2024 /PRNewswire/ -- EchoStar Corporation (Nasdaq:
SATS) ("EchoStar"), a global, fully integrated communication
and content delivery leader and provider of technology, spectrum,
engineering, manufacturing, networking services, television
entertainment and connectivity bolstered by its merger with DISH
Network Corporation ("DISH"), today announced that it has
commenced offers to exchange (i) any and all of the 0% Convertible
Notes due 2025 (the "DISH Network 2025 Notes") issued by its
subsidiary DISH and (ii) any and all of the 3.375% Convertible
Notes due 2026 issued by DISH (the "DISH Network 2026
Notes," and together with the DISH Network 2025 Notes, the
"Existing DISH Notes"), each for 10.00% Senior Secured Notes
due 2030 to be issued by EchoStar Corporation (the "EchoStar
Notes"), in each case, pursuant to the terms described in a
preliminary prospectus and consent solicitation statement, dated
January 12, 2024 (the "Preliminary
Exchange Offer Prospectus").
Today's announcement further advances EchoStar's objective of
realizing on the synergistic opportunities of the combined business
to utilize its valuable portfolio of spectrum and other assets to
optimize its capital structure to position the business to execute
on its strategic goal of becoming the premier provider of
terrestrial mobile, satellite connectivity, and content
services.
The following table describes certain terms of the exchange
offers:
Title of Existing
DISH Notes
|
CUSIP/ISIN
Number(1)
|
Principal
Amount
Outstanding(2)
|
Exchange
Consideration(3)
|
0% Convertible Notes
due
2025
|
25470MAF6/US2547MAF68
|
$1,957,197,000
|
$610
|
3.375% Convertible
Notes due
2026
|
25470MAB5/US2547MAB54
|
$2,908,801,000
|
$510
|
(1)
|
No representation is
made as to the correctness or accuracy of the CUSIP or ISIN
numbers listed in this prospectus or printed on the
Existing DISH Notes. They are provided solely for
convenience.
|
(2)
|
Net of $42,803,000 and
$91,199,000 of 0% Convertible Notes due 2025 and 3.375% Convertible
Notes due 2026, respectively, that
are held by DISH and not deemed outstanding.
|
(3)
|
Consideration in the
form of principal amount of EchoStar Notes per $1,000
principal amount of Existing DISH Notes that are validly
tendered and accepted for exchange, subject to any rounding as
described herein. Excludes accrued interest, which will be paid in
cash
in addition to the Exchange Consideration, as
applicable.
|
The EchoStar Notes will be guaranteed on a senior secured basis
by EchoStar's indirect subsidiary, DBSD Corporation
("DBSD"), and secured by first priority liens on the 20 MHz
of AWS-4 spectrum (consisting of 10 MHz of N70 and 10 MHz of N66)
held by DBSD (the "Spectrum Collateral"), and EchoStar's
indirect subsidiary, DBSD Services Limited, which will provide a
security interest consisting of a first priority pledge of the
equity interests of DBSD (in each case as described in the
Preliminary Exchange Offer Prospectus). EchoStar currently
estimates the fair market value of the Spectrum Collateral that
will secure the EchoStar Notes to be approximately $9 billion. The EchoStar Notes will not have
recourse to any assets of any other subsidiary of EchoStar other
than as set forth above.
Concurrently with the exchange offers, EchoStar is soliciting
consents from holders of each series of the Existing DISH Notes to
amend the terms of the applicable series of Existing DISH Notes and
the indentures governing such Existing DISH Notes to, among other
things, eliminate certain events of default (including any
cross-defaults related to any payment, bankruptcy or other defaults
of any DISH subsidiary) and substantially all of the restrictive
covenants in each such indenture and the Existing DISH Notes of the
applicable series, including, but not limited to, the merger
covenant, the reporting covenant and to make certain conforming
changes to each such indenture and the Existing DISH Notes of the
applicable series to reflect the proposed amendments (the
"Proposed Amendments"). Holders may not consent to the
Proposed Amendments without tendering the applicable Existing DISH
Notes in the relevant exchange offer, and holders may not tender
Existing DISH Notes of any series for exchange without consenting
to the Proposed Amendments for such series.
Each exchange offer and consent solicitation is a separate offer
and/or solicitation, and each may be individually amended,
extended, terminated or withdrawn, subject to certain conditions
and applicable law, at any time in the EchoStar's sole discretion,
and without amending, extending, terminating or withdrawing any
other exchange offer or consent solicitation. Additionally,
notwithstanding any other provision of the exchange offers,
EchoStar's obligations to accept and exchange any of the Existing
DISH Notes validly tendered pursuant to an exchange offer is
subject to the satisfaction or waiver of certain conditions, as
described in the Registration Statement, and EchoStar expressly
reserves its right, subject to applicable law, to terminate any
exchange offer and/or consent solicitation at any time.
The exchange offers and consent solicitations will expire at
11:59 p.m., New York City time, on February 9, 2024, or any other date and time to
which EchoStar extends such period for such exchange offer or
consent solicitation in its sole discretion (such date and time for
such exchange offer or consent solicitation, as it may be extended,
the "Expiration Date"). To be eligible to receive the
applicable exchange consideration in the applicable exchange offer
and consent solicitation, holders must validly tender and not
validly withdraw their Existing DISH Notes and validly deliver and
not revoke their consents at or prior to the Expiration Date.
Holders may withdraw tendered Existing DISH Notes at any time prior
to the Expiration Date. Any Existing DISH Notes withdrawn pursuant
to the terms of the applicable exchange offer and consent
solicitation shall not thereafter be considered tendered for any
purpose unless and until such notes are again tendered pursuant to
the applicable exchange offer and consent solicitation. Existing
DISH Notes not exchanged in the exchange offers and consent
solicitations will be returned to the tendering holder at
EchoStar's expense promptly after the expiration or termination of
the exchange offers and consent solicitations.
A registration statement on Form S-4 relating to the EchoStar
Notes (the "Registration Statement") has been filed
with the Securities and Exchange Commission (the "SEC") but
has not yet become effective. The consummation of each exchange
offer and consent solicitation is subject to, and conditional upon,
the satisfaction or, where permitted, waiver of certain conditions
including, among other things, the effectiveness of the
Registration Statement, and at least a majority of the outstanding
principal amount of the applicable series of Existing DISH Notes
being validly tendered and not properly withdrawn prior to the
Expiration Date (the "Minimum Tender Condition"). All
conditions to each exchange offer and consent solicitation must be
satisfied or, where permitted, waived, on or prior to the
Expiration Date. For the avoidance of doubt, EchoStar
reserves the right to waive in its sole and absolute discretion the
Minimum Tender Condition and accept any and all Existing DISH Notes
validly tendered and not validly withdrawn at or prior to the
expiration date.
EchoStar is conducting the exchange offers and consent
solicitations in order to, among other things, reduce its
consolidated indebtedness, address certain of its nearer term debt
maturities and resultantly materially extend its debt maturity
profile, which will provide significant runway for continued
strategic investment in its business and further enhance EchoStar's
unique opportunity to combine DISH Network's satellite technology,
streaming services and nationwide 5G network with EchoStar's
premier satellite communications solutions, creating a global
leader in terrestrial and non-terrestrial wireless
connectivity.
White & Case LLP is acting as legal advisor to EchoStar and
D.F. King & Co., Inc. is acting as exchange agent and
information agent for the exchange offers and consent
solicitations.
This press release does not constitute an offer to sell or
exchange or the solicitation of an offer to buy or exchange any
securities, nor shall there be any exchange of the EchoStar Notes
for Existing DISH Notes pursuant to the exchange offers and consent
solicitations in any jurisdiction in which such exchanges would be
unlawful prior to registration or qualification under the laws of
such jurisdiction.
About EchoStar Corporation
EchoStar Corporation (Nasdaq: SATS) is a premier provider of
technology, networking services, television entertainment and
connectivity, offering consumer, enterprise, operator and
government solutions worldwide under its EchoStar®, Boost Mobile®,
Boost Infinite, Sling TV, DISH TV, Hughes®, HughesNet®, HughesON™,
and JUPITER™ brands. In Europe,
EchoStar operates under its EchoStar Mobile Limited subsidiary and
in Australia, the company operates
as EchoStar Global Australia. For more information, visit
www.echostar.com and follow EchoStar on X (Twitter) and
LinkedIn.
Where You Can Find Additional Information
As noted above, further details regarding the terms and
conditions of the exchange offers and consent solicitations,
including descriptions of the EchoStar Notes and the material
differences between the EchoStar Notes and the Existing DISH Notes,
can be found in the registration statement that has been filed with
the SEC but has not yet become effective, and in a tender offer
statement on Schedule TO that has been filed with the SEC. The
securities subject to the registration statement may not be issued
and sold prior to the time the registration statement becomes
effective. ANY INVESTOR HOLDING EXISTING DISH NOTES IS URGED TO
READ THE REGISTRATION STATEMENT, THE TENDER OFFER STATEMENT AND
OTHER DOCUMENTS ECHOSTAR HAS FILED OR WILL FILE WITH THE SEC
BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT THE ISSUER AND THE
OFFERING.
The registration statement, the tender offer statement and other
related documents, when filed, can be obtained for free from the
SEC's website at www.sec.gov. Documents are also available for free
upon oral request made to EchoStar at (303) 706-4000 or written
request made to EchoStar Corporation, Attention: Investor
Relations, 100 Inverness Terrace East, Englewood, Colorado 80112 and from EchoStar's
website at www.echostar.com.
Holders can also request copies of the offering materials by
contacting D.F. King & Co., Inc. by sending an email to
DISH@dfking.com or by calling (800) 967-5084 (U.S. toll-free) or
(212) 269-5550 (banks and brokers).
Forward-looking Statements
This document contains "forward-looking statements" within the
meaning of the Private Securities Litigation Reform Act of 1995,
Section 27A of the Securities Act, and Section 21E of the Exchange
Act, including, in particular, statements about plans, objectives
and strategies, growth opportunities in our industries and
businesses, our expectations regarding future results, financial
condition, liquidity and capital requirements, estimates regarding
the impact of regulatory developments and legal proceedings, and
other trends and projections. Forward-looking statements are not
historical facts and may be identified by words such as "future,"
"anticipate," "intend," "plan," "goal," "seek," "believe,"
"estimate," "expect," "predict," "will," "would," "could," "can,"
"may," and similar terms. These forward-looking statements are
based on information available to us as of the date hereof and
represent management's current views and assumptions.
Forward-looking statements are not guarantees of future
performance, events or results and involve known and unknown risks,
uncertainties and other factors, which may be beyond our control.
Accordingly, actual performance, events or results could differ
materially from those expressed or implied in the forward-looking
statements due to a number of factors. Additional information
concerning these risk factors is contained in each of EchoStar's
and DISH Network's most recently filed Annual Report on Form 10-K
and subsequent Quarterly Reports on Form 10-Q, and in EchoStar's
subsequent Current Reports on Form 8-K, and other SEC filings. All
cautionary statements made or referred to herein should be read as
being applicable to all forward-looking statements wherever they
appear. You should consider the risks and uncertainties described
or referred to herein and should not place undue reliance on any
forward-looking statements. The forward-looking statements speak
only as of the date made. We do not undertake, and specifically
disclaim, any obligation to publicly release the results of any
revisions that may be made to any forward-looking statements,
whether as a result of new information, future events or otherwise,
except as required by law. Should one or more of the risks or
uncertainties described herein or in any documents we file with the
SEC occur, or should underlying assumptions prove incorrect, our
actual results and plans could differ materially from those
expressed in any forward-looking statements.
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SOURCE EchoStar Corporation