DISH NETWORK CORPORATION (NASDAQ:DISH) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01 Entry into a Material Definitive Agreement.
On March17, 2017, DISH Network Corporation (DISH Network)
completed a private placement of $1 billion aggregate principal
amount of its 2.375% Convertible Notes due 2024 (the Notes).
DISH Network intends to use the net proceeds from the placement
for strategic transactions, which may include wireless and
spectrum-related strategic transactions, and for other general
corporate purposes.
DISH Network entered into an Indenture (the Indenture), dated as
of March17, 2017, with U.S. Bank National Association (the
Trustee), as trustee, relating to the issuance of the Notes.
The Notes will bear interest at a rate of 2.375% per year,
payable semi-annually in arrears on March15 and September15 of
each year, commencing September15, 2017. The Notes will mature on
March15, 2024, unless earlier repurchased or converted.
Subject to the terms of the Indenture, the Notes may be converted
at an initial conversion rate of 12.1630 shares of ClassA Common
Stock of DISH Network (ClassA Common Stock) per $1,000 principal
amount of Notes (equivalent to an initial conversion price of
approximately $82.22 per share of ClassA Common Stock) (the
Initial Conversion Rate), at any time on or after October15, 2023
through the second scheduled trading day preceding the maturity
date. Holders of the Notes will also have the right to convert
the Notes at the Initial Conversion Rate prior to October15,
2023, but only upon the occurrence of specified events described
in the Indenture. The conversion rate is subject to anti-dilution
adjustments if certain events occur.
If certain corporate events (each defined in the Indenture as a
Make-Whole Fundamental Change) occur prior to the maturity date
of the Notes, and a holder elects to convert its Notes in
connection with such corporate event, DISH Network will, under
certain circumstances, increase the conversion rate for the Notes
so surrendered for conversion by a number of additional shares of
ClassA Common Stock as specified in a table included in the
Indenture. No adjustment to the conversion rate will be made if
the price paid or deemed to be paid per share of ClassA Common
Stock in such corporate event is either less than $62.05 or
exceeds $300.00.
If a specified Make-Whole Fundamental Change occurs prior to the
maturity date of the Notes, under certain circumstances each
holder may require DISH Network to repurchase all or part of
their Notes at a repurchase price equal to 50% of the principal
amount, plus accrued and unpaid interest to, but not including,
the repurchase date.
Under the Indenture, the Notes can be accelerated upon the
occurrence of certain customary events of default. In the case of
an event of default with respect to the Notes arising from
specified events of bankruptcy or insolvency, 50% of the
principal of and accrued and unpaid interest on the Notes will
automatically become due and payable. If any other event of
default with respect to the Notes under the Indenture occurs or
is continuing, the trustee or holders of at least 25% in
aggregate principal amount of the then outstanding Notes may
declare the principal amount of the Notes to be immediately due
and payable.
DISH Network may elect that the sole remedy for an event of
default relating to a failure by it to comply with certain
reporting obligations set forth in the Indenture, will after the
occurrence of such an event of default consist exclusively of the
right to receive additional interest on the Notes at a rate equal
to (i)0.25% per annum for each day during the period beginning
on, and including, the date on which such event of default first
occurred and ending on the earlier of (x)the date on which such
event of default is cured or validly waived and (y)the 180th day
immediately following, and including, the date on which such
event of default first occurred; and (ii)if such event of default
has not been cured or validly waived prior to the 181st day
immediately following, and including, the date on which such
event of default first occurred, 0.50% per annum for each day
during the period beginning on, and including, the 181st day
immediately following, and including, the date on which such
event of default first occurred and ending on the earlier of
(x)the date on which the event of default is cured or validly
waived and (y)the 360th day immediately following, and including,
the date on which such event of default first occurred.
If, at any time during the six month period beginning on, and
including, the date that is six months after the last original
issue date of the Notes, DISH Network fails to timely file any
document or report (other than reports on Form8-K) that it is
required to file with the U.S. Securities and Exchange Commission
(the SEC) to Section13 or 15(d)of the Exchange Act of 1934, as
amended (the Exchange Act), as applicable (after giving effect to
all applicable grace periods thereunder), or the Notes are not
otherwise freely tradable by holders other than DISH Networks
affiliates, DISH Network will pay additional interest on the
Notes at a rate equal to (i) during the first three months of
such six month period, 0.25% per annum and (ii)during the last
three months of such six month period, 0.50% per annum, in each
case for each day for which DISH Networks failure to file has
occurred and is continuing or the Notes are not otherwise freely
tradable as described above.
Further, if, and for so long as, the restrictive legend on the
Notes has not been removed, the Notes are assigned a restricted
CUSIP number or the Notes are not otherwise freely tradable by
holders other than affiliates of DISH Network as of the 370th
day after the last original issue date of the Notes, DISH
Network will pay additional interest on the Notes at a rate
equal to 0.50% per annum of the principal amount of the Notes
outstanding until the restrictive legend has been removed from
the Notes, the Notes are assigned an unrestricted CUSIP number
and the Notes are freely tradable as described above.
In no event shall additional interest, if any, payable as a
result of (i)DISH Networks failure to timely file any document
or report that it is required to file with the SEC to Section13
or 15(d)of the Exchange Act, (ii)the Notes not being freely
tradable by holders other than affiliates of DISH Network, or
(iii)the restrictive legend on the Notes not having been
removed, the Notes having been assigned a restricted CUSIP
number or the Notes not otherwise being freely tradable by
holders other than affiliates of DISH Network as of the 370th
day after the last original issue date of the Notes, together
with any additional interest payable at DISH Networks election
as the sole remedy for an event of default relating to a
failure to comply with reporting obligations as described
above, accrue at a rate in excess of 0.50% per annum to the
Indenture regardless of the number of events or circumstances
giving rise to the requirement to pay such additional interest.
The Trustee is also the trustee for the 3.375% Convertible
Notes due 2026 issued by DISH Network and certain senior notes
issued by DISH DBS Corporation, a subsidiary of DISH Network.
DISH Network may from time to time maintain banking
relationships in the ordinary course of business with the
Trustee and its affiliates.
The description of the Indenture is a summary and is qualified
in its entirety by reference to the complete text of the
Indenture, a copy of which is filed as Exhibit4.1 hereto and is
incorporated herein by reference.
Item2.03 Creation of Direct Financial Obligation or an
Obligation under an Off-Balance Sheet Arrangement of a
Registrant.
The information set forth in Item 1.01 of this Current Report
on Form8-K is incorporated herein by reference.
Item3.02 Unregistered Sales of Equity
Securities.
The information set forth in Item 1.01 of this Current Report
on Form8-K is incorporated herein by reference. DISH Network
placed the Notes in a private placement to Section4(a)(2)of the
Securities Act of 1933, as amended (the Securities Act). The
Notes and shares of ClassA Common Stock issuable upon the
conversion of the Notes, if any, have not been and are not
intended to be registered under the Securities Act or the
securities laws of any other jurisdiction and may not be
offered or sold in the United States absent registration or an
applicable exemption from registration requirements.
Item7.01 RegulationFD Disclosure.
On March20, 2017, DISH Network issued a news release announcing
the closing of its private placement of $1 billion aggregate
principal amount of the Notes. A copy of the press release is
attached as Exhibit99.1 to this Current Report on Form8-K and
incorporated herein by reference.
The information contained in this Item 7.01 is being furnished
and shall not be deemed filed with the SEC or otherwise
incorporated by reference into any registration statement or
other document filed to the Securities Act or the Exchange Act.
Certain statements incorporated by reference in this Current
Report on Form8-K may be forward-looking statements, which may
involve a number of risks and uncertainties that could cause
actual events or results to differ materially from those
described. DISH Network does not undertake any obligation to
update forward-looking statements.
Item9.01 Financial Statements and Exhibits.
(d)Exhibits.
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4.1 |
Indenture, dated as of March17, 2017, by and between DISH |
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99.1 |
Press Release DISH Network Announces Closing of $1 |
About DISH NETWORK CORPORATION (NASDAQ:DISH)
DISH Network Corporation is a holding company. The Company operates through two segments: DISH and Wireless. It offers Pay-TV services under the DISH brand and the Sling brand (collectively Pay-TV services). The DISH branded Pay-TV service consists of Federal Communications Commission (FCC) licenses authorizing it to use direct broadcast satellite (DBS) and Fixed Satellite Service (FSS) spectrum, its owned and leased satellites, receiver systems, third-party broadcast operations, customer service facilities, a leased fiber optic network, in-home service and call center operations, and certain other assets utilized in its operations. The Sling branded pay-TV services consist of live, linear streaming over-the-top Internet-based domestic, international and Latino video programming services (Sling TV). The Company markets its broadband services under the dishNET brand, which has over 0.623 million subscribers in the United States. DISH NETWORK CORPORATION (NASDAQ:DISH) Recent Trading Information
DISH NETWORK CORPORATION (NASDAQ:DISH) closed its last trading session up +0.64 at 63.86 with 4,990,010 shares trading hands.
