DISH Network Announces Closing of $3 Billion Offering of 3.375% Convertible Notes Due 2026
August 08 2016 - 04:07PM
Business Wire
DISH Network Corporation (“DISH Network”) (NASDAQ: DISH) today
announced that it has closed its previously announced offering of
$3 billion aggregate principal amount of 3.375% Convertible Notes
due 2026 (the “notes”). The net proceeds, before offering expenses,
from the offering in the amount of $2.723 billion (after payment of
the net cost of the contemporaneous convertible note hedge
transactions and warrant transactions described below) are intended
to be used for strategic transactions, which may include wireless
and spectrum-related strategic transactions, and for other general
corporate purposes.
As previously announced, in connection with the pricing of the
notes, DISH Network entered into convertible note hedge
transactions with four financial institutions, including an
affiliate of the initial purchaser of the notes (each, an “option
counterparty”). The convertible note hedge transactions are
expected generally to reduce potential dilution to holders of DISH
Network’s Class A Common Stock attributable to any conversion of
the notes and/or offset any cash payments DISH Network is required
to make in excess of the principal amount of converted notes, as
the case may be. DISH Network also entered into warrant
transactions with each option counterparty. The warrant
transactions could separately have a dilutive effect to the extent
that the market price per share of DISH Network’s Class A Common
Stock exceeds the strike price of the warrants, unless DISH Network
elects to settle the warrants in cash. For DISH Network, the
economic effect of these transactions, which are not part of the
terms of the notes and will not change the holders’ rights under
the notes, is to effectively raise the conversion premium on the
notes from approximately 32.5% to approximately 75%, by raising the
initial conversion price from approximately $65.18 per share of
DISH Network’s Class A Common Stock to approximately $86.0825 per
share of Class A Common Stock.
Safe Harbor Statement under the Private Securities Litigation
Reform Act of 1995
Except for historical information contained herein, the matters
set forth in this press release are forward-looking statements. The
forward-looking statements set forth above involve a number of
risks and uncertainties that could cause actual results to differ
materially from any such statement, including the risks and
uncertainties discussed in DISH Network’s Disclosure Regarding
Forward-Looking Statements included in its recent filings with the
Securities and Exchange Commission, including its annual report on
Form 10-K and quarterly reports on Form 10-Q. The forward-looking
statements speak only as of the date made, and DISH Network
expressly disclaims any obligation to update these forward-looking
statements.
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version on businesswire.com: http://www.businesswire.com/news/home/20160808006000/en/
DISHBob Toevs, 720-514-5351news@dish.com
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