Item 1.01 Entry into a Material Definitive Agreement.
On July 1, 2020, DISH DBS Corporation (the "Company"), an indirect wholly-owned
subsidiary of DISH Network Corporation, entered into an indenture (the
"Indenture"), among the Company, the guarantors named on the signature
page thereto (the "Guarantors") and U.S. Bank National Association, as trustee
(the "Trustee"), relating to the Company's issuance of $1 billion aggregate
principal amount of its 7.375% Senior Notes due 2028 (the "Notes") at an issue
price of 100% of the principal amount of the Notes. A copy of the Indenture is
attached hereto as Exhibit 4.1, and incorporated herein by reference. For a
description of the material terms of the Indenture and the Notes, see the
information set forth below under Item 2.03, which is incorporated by reference
into this Item 1.01.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
On July 1, 2020, the Company issued $1 billion aggregate principal amount of the
Notes pursuant to the Indenture at an issue price of 100% of the principal
amount of the Notes. The Notes were sold in a private placement to (1) persons
reasonably believed to be "qualified institutional buyers" in reliance on
Rule 144A under the Securities Act of 1933, as amended (the "Securities Act")
and (2) outside the United States to persons who are not "U.S. persons" (as
defined in Rule 902 of Regulation S under the Securities Act) in compliance with
Regulation S under the Securities Act.
The Notes bear interest at a rate of 7.375% per annum and mature on July 1,
2028. Interest on the Notes will be payable semi-annually on January 1 and
July 1 of each year, commencing January 1, 2021, to the holders of record of
such Notes at the close of business on December 15 and June 15, respectively,
preceding such interest payment date. The Indenture contains covenants that will
limit the Company's ability and, in certain instances, the ability of certain of
the Company's subsidiaries, to, among other things: (i) incur additional debt;
(ii) pay dividends or make distributions on the Company's capital stock or
repurchase the Company's capital stock; (iii) make certain investments;
(iv) create liens or enter into sale and leaseback transactions; (v) enter into
transactions with affiliates; (vi) merge or consolidate with another company;
and (vii) transfer and sell assets. These covenants include certain exceptions.
The Company may, at its option, at any time and from time to time prior to
July 1, 2023, redeem all or any portion of the Notes on not less than 10 and not
more than 60 days' prior notice mailed to the holders of the Notes to be
redeemed. The Notes will be redeemable at a price equal to the principal amount
of the Notes being redeemed, together with accrued and unpaid interest, if any,
to the date of redemption and a "make-whole" premium calculated under the
Indenture. At any time prior to July 1, 2023, the Company may also redeem up to
35% of the Notes at a purchase price equal to 107.375% of the principal amount
of the Notes redeemed, together with accrued and unpaid interest, if any, to the
date of redemption with the net cash proceeds from certain equity offerings or
capital contributions. On or after July 1, 2023, the Company may redeem the
Notes at the fixed redemption prices (expressed as percentages of the principal
amount of Notes to be redeemed) set forth in the Indenture, together with
accrued and unpaid interest, if any, to the date of redemption.
The Indenture provides for customary events of default, including: nonpayment,
breach of the covenants in the Indenture, payment defaults or acceleration of
other indebtedness, a failure to pay certain judgments and certain events of
bankruptcy, insolvency and reorganization. If any event of default occurs and is
continuing under the Indenture, the trustee or the holders of at least 25% in
principal amount of the then outstanding Notes issued pursuant to the Indenture
may declare all the Notes issued pursuant to the Indenture to be due and payable
immediately, together with interest, if any, accrued thereon.
Under the terms of a Registration Rights Agreement, the Company has agreed to
register notes having substantially identical terms as the Notes with the
Securities and Exchange Commission as part of an offer to exchange freely
tradable exchange notes for the Notes.
The description set forth above is qualified in its entirety by the Indenture
and the Registration Rights Agreement filed herewith as exhibits.
A copy of the Registration Rights Agreement is attached hereto as Exhibit 4.2
and incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit No. Description
Exhibit 4.1 Indenture, relating to the Notes, dated as of July 1, 2020, among the
Company, the Guarantors and U.S. Bank National Association, as
trustee.
Exhibit 4.2 Registration Rights Agreement, dated as of July 1, 2020, among the
Company, the Guarantors and J.P. Morgan Securities LLC.
Exhibit 104 Cover Page Interactive Data File (embedded within the Inline XBRL
document).
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