|
Nevada
|
|
26-1232727
|
||
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
||
|
|
|
|
|
|
|
100 Inverness Terrace East,
|
Englewood,
|
Colorado
|
|
80112-5308
|
|
(Address of principal executive offices)
|
|
(Zip Code)
|
||
|
|
|
|
|
|
|
(303)
|
706-4000
|
|
|
Not Applicable
|
|
(Registrant’s telephone number, including area code)
|
|
(Former name, former address and former fiscal year, if changed since last report)
|
||
|
|
|
|
|
|
|
Securities registered pursuant to Section 12(b) of the Act:
|
|
|
||
|
Class A common stock
|
$0.001 par value
|
|
The NASDAQ Stock Market LLC
|
|
|
(Title of each class)
|
|
(Name of each exchange on which registered)
|
||
|
SATS
|
|
|
||
|
(Ticker symbol)
|
|
|
||
|
Large accelerated filer
|
☒
|
Accelerated filer
|
☐
|
Emerging growth company
|
☐
|
|
Non-accelerated filer
|
☐
|
Smaller reporting company
|
☐
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
•
|
significant risks related to the construction and operation of our satellites, such as the risk of not being able to timely complete the construction of or material malfunction on one or more of our satellites, risks resulting from potentially missing our regulatory milestones, changes in the space weather environment that could interfere with the operation of our satellites and our general lack of commercial insurance coverage on our satellites;
|
|
•
|
our ability to implement and/or realize benefits of our domestic and/or international investments, commercial alliances, partnerships, joint ventures, acquisitions, dispositions and other strategic initiatives and transactions including, without limitation, the pending BSS Transaction (as defined herein);
|
|
•
|
lawsuits relating to the BSS Transaction could result in substantial costs and may delay or prevent the BSS Transaction from being consummated at all or on the terms provided for in the Master Transaction Agreement (as defined herein);
|
|
•
|
the possibility that the BSS Transaction will not be consummated on the terms or timeline currently contemplated, or at all. We have and will continue to expend time and resources of management and to incur legal, advisory and financial services fees related to the BSS Transaction regardless of whether the BSS Transaction is consummated;
|
|
•
|
uncertainty regarding the BSS Transaction may cause customers, suppliers or strategic partners to delay or defer decisions concerning us and adversely affect our ability to effectively manage our business;
|
|
•
|
if the BSS Transaction is not consummated, our reliance on DISH Network Corporation and its subsidiaries (“DISH Network”) for a significant portion of our revenue;
|
|
•
|
our ability to realize the anticipated benefits of our current satellites and any future satellite we may construct or acquire;
|
|
•
|
risks related to our foreign operations and other uncertainties associated with doing business internationally, including changes in foreign exchange rates between foreign currencies and the United States dollar, economic instability and political disturbances;
|
|
•
|
the failure of third-party providers of components, manufacturing, installation services and customer support services to appropriately deliver the contracted goods or services; and
|
|
•
|
our ability to bring advanced technologies to market to keep pace with our customers and competitors.
|
|
|
|
As of
|
||||||
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
|
Assets
|
|
(Unaudited)
|
|
(Audited)
|
||||
|
Current assets:
|
|
|
|
|
|
|
||
|
Cash and cash equivalents
|
|
$
|
1,298,005
|
|
|
$
|
928,306
|
|
|
Marketable investment securities, at fair value
|
|
1,203,308
|
|
|
2,282,152
|
|
||
|
Trade accounts receivable and contract assets, net (Note 3)
|
|
201,561
|
|
|
201,096
|
|
||
|
Trade accounts receivable - DISH Network
|
|
13,943
|
|
|
14,200
|
|
||
|
Inventory
|
|
73,345
|
|
|
75,379
|
|
||
|
Prepaids and deposits
|
|
65,589
|
|
|
61,177
|
|
||
|
Other current assets
|
|
19,857
|
|
|
18,539
|
|
||
|
Total current assets
|
|
2,875,608
|
|
|
3,580,849
|
|
||
|
Noncurrent assets:
|
|
|
|
|
|
|
||
|
Property and equipment, net
|
|
3,329,794
|
|
|
3,414,908
|
|
||
|
Operating lease right-of-use assets
|
|
113,643
|
|
|
—
|
|
||
|
Goodwill
|
|
504,173
|
|
|
504,173
|
|
||
|
Regulatory authorizations, net
|
|
493,661
|
|
|
495,654
|
|
||
|
Other intangible assets, net
|
|
36,869
|
|
|
44,231
|
|
||
|
Investments in unconsolidated entities
|
|
225,582
|
|
|
262,473
|
|
||
|
Other receivables - DISH Network
|
|
96,733
|
|
|
95,114
|
|
||
|
Other noncurrent assets, net
|
|
274,028
|
|
|
263,892
|
|
||
|
Total noncurrent assets
|
|
5,074,483
|
|
|
5,080,445
|
|
||
|
Total assets
|
|
$
|
7,950,091
|
|
|
$
|
8,661,294
|
|
|
Liabilities and Stockholders’ Equity
|
|
|
|
|
|
|
||
|
Current liabilities:
|
|
|
|
|
|
|
||
|
Trade accounts payable
|
|
$
|
105,929
|
|
|
$
|
121,437
|
|
|
Trade accounts payable - DISH Network
|
|
1,113
|
|
|
1,698
|
|
||
|
Current portion of long-term debt and finance lease obligations
|
|
42,682
|
|
|
959,577
|
|
||
|
Contract liabilities
|
|
106,308
|
|
|
72,284
|
|
||
|
Accrued interest
|
|
42,835
|
|
|
47,416
|
|
||
|
Accrued compensation
|
|
44,829
|
|
|
54,242
|
|
||
|
Accrued taxes
|
|
16,221
|
|
|
16,013
|
|
||
|
Accrued expenses and other
|
|
111,745
|
|
|
72,470
|
|
||
|
Total current liabilities
|
|
471,662
|
|
|
1,345,137
|
|
||
|
Noncurrent liabilities:
|
|
|
|
|
|
|
||
|
Long-term debt and finance lease obligations, net
|
|
2,553,352
|
|
|
2,573,204
|
|
||
|
Deferred tax liabilities, net
|
|
472,872
|
|
|
465,933
|
|
||
|
Operating lease liabilities
|
|
94,979
|
|
|
—
|
|
||
|
Other noncurrent liabilities
|
|
114,275
|
|
|
121,546
|
|
||
|
Total noncurrent liabilities
|
|
3,235,478
|
|
|
3,160,683
|
|
||
|
Total liabilities
|
|
3,707,140
|
|
|
4,505,820
|
|
||
|
Commitments and contingencies (Note 15)
|
|
|
|
|
|
|
||
|
Stockholders’ equity:
|
|
|
|
|
|
|
||
|
Preferred stock, $0.001 par value, 20,000,000 shares authorized, none issued and outstanding at each of June 30, 2019 and December 31, 2018
|
|
—
|
|
|
—
|
|
||
|
Common stock, $0.001 par value, 4,000,000,000 shares authorized:
|
|
|
|
|
|
|
||
|
Class A common stock, $0.001 par value, 1,600,000,000 shares authorized, 56,189,672 shares issued and 49,704,751 shares outstanding at June 30, 2019 and 54,142,566 shares issued and 47,657,645 shares outstanding at December 31, 2018
|
|
56
|
|
|
54
|
|
||
|
Class B convertible common stock, $0.001 par value, 800,000,000 shares authorized, 47,687,039 shares issued and outstanding at each of June 30, 2019 and December 31, 2018
|
|
48
|
|
|
48
|
|
||
|
Class C convertible common stock, $0.001 par value, 800,000,000 shares authorized, none issued and outstanding at each of June 30, 2019 and December 31, 2018
|
|
—
|
|
|
—
|
|
||
|
Class D common stock, $0.001 par value, 800,000,000 shares authorized, none issued and outstanding at each of June 30, 2019 and December 31, 2018
|
|
—
|
|
|
—
|
|
||
|
Additional paid-in capital
|
|
3,777,499
|
|
|
3,702,522
|
|
||
|
Accumulated other comprehensive loss
|
|
(119,500
|
)
|
|
(125,100
|
)
|
||
|
Accumulated earnings
|
|
704,236
|
|
|
694,129
|
|
||
|
Treasury stock, at cost
|
|
(131,454
|
)
|
|
(131,454
|
)
|
||
|
Total EchoStar Corporation stockholders’ equity
|
|
4,230,885
|
|
|
4,140,199
|
|
||
|
Noncontrolling interests
|
|
12,066
|
|
|
15,275
|
|
||
|
Total stockholders’ equity
|
|
4,242,951
|
|
|
4,155,474
|
|
||
|
Total liabilities and stockholders’ equity
|
|
$
|
7,950,091
|
|
|
$
|
8,661,294
|
|
|
|
|
For the three months
ended June 30, |
|
For the six months
ended June 30, |
||||||||||||
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Services and other revenue - DISH Network
|
|
$
|
85,057
|
|
|
$
|
100,171
|
|
|
$
|
170,945
|
|
|
$
|
203,976
|
|
|
Services and other revenue - other
|
|
394,422
|
|
|
375,445
|
|
|
787,902
|
|
|
730,485
|
|
||||
|
Equipment revenue
|
|
57,645
|
|
|
50,341
|
|
|
109,359
|
|
|
93,288
|
|
||||
|
Total revenue
|
|
537,124
|
|
|
525,957
|
|
|
1,068,206
|
|
|
1,027,749
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Cost of sales - services and other (exclusive of depreciation and amortization)
|
|
153,198
|
|
|
151,157
|
|
|
306,769
|
|
|
299,902
|
|
||||
|
Cost of sales - equipment (exclusive of depreciation and amortization)
|
|
46,549
|
|
|
41,865
|
|
|
91,556
|
|
|
80,936
|
|
||||
|
Selling, general and administrative expenses
|
|
152,629
|
|
|
103,074
|
|
|
264,763
|
|
|
206,349
|
|
||||
|
Research and development expenses
|
|
6,388
|
|
|
6,647
|
|
|
13,276
|
|
|
13,784
|
|
||||
|
Depreciation and amortization
|
|
155,410
|
|
|
148,449
|
|
|
309,631
|
|
|
294,003
|
|
||||
|
Total costs and expenses
|
|
514,174
|
|
|
451,192
|
|
|
985,995
|
|
|
894,974
|
|
||||
|
Operating income
|
|
22,950
|
|
|
74,765
|
|
|
82,211
|
|
|
132,775
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Interest income
|
|
23,213
|
|
|
19,253
|
|
|
47,642
|
|
|
34,888
|
|
||||
|
Interest expense, net of amounts capitalized
|
|
(60,163
|
)
|
|
(61,534
|
)
|
|
(120,045
|
)
|
|
(124,285
|
)
|
||||
|
Gains (losses) on investments, net
|
|
12,856
|
|
|
65,396
|
|
|
19,791
|
|
|
28,733
|
|
||||
|
Equity in losses of unconsolidated affiliates, net
|
|
(4,754
|
)
|
|
(2,058
|
)
|
|
(11,107
|
)
|
|
(3,067
|
)
|
||||
|
Other, net
|
|
1,760
|
|
|
(336
|
)
|
|
558
|
|
|
(132
|
)
|
||||
|
Total other income (expense), net
|
|
(27,088
|
)
|
|
20,721
|
|
|
(63,161
|
)
|
|
(63,863
|
)
|
||||
|
Income (loss) before income taxes
|
|
(4,138
|
)
|
|
95,486
|
|
|
19,050
|
|
|
68,912
|
|
||||
|
Income tax provision, net
|
|
(922
|
)
|
|
(17,802
|
)
|
|
(9,102
|
)
|
|
(12,399
|
)
|
||||
|
Net income (loss)
|
|
(5,060
|
)
|
|
77,684
|
|
|
9,948
|
|
|
56,513
|
|
||||
|
Less: Net income attributable to noncontrolling interests
|
|
632
|
|
|
462
|
|
|
1,438
|
|
|
842
|
|
||||
|
Net income (loss) attributable to EchoStar Corporation common stock
|
|
$
|
(5,692
|
)
|
|
$
|
77,222
|
|
|
$
|
8,510
|
|
|
$
|
55,671
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Earnings per share - Class A and B common stock:
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Basic earnings (loss) per share
|
|
$
|
(0.06
|
)
|
|
$
|
0.80
|
|
|
$
|
0.09
|
|
|
$
|
0.58
|
|
|
Diluted earnings (loss) per share
|
|
$
|
(0.06
|
)
|
|
$
|
0.80
|
|
|
$
|
0.09
|
|
|
$
|
0.57
|
|
|
|
|
For the three months
ended June 30, |
|
For the six months
ended June 30, |
||||||||||||
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
Net income (loss)
|
|
$
|
(5,060
|
)
|
|
$
|
77,684
|
|
|
$
|
9,948
|
|
|
$
|
56,513
|
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Foreign currency translation adjustments
|
|
2,896
|
|
|
(43,727
|
)
|
|
3,807
|
|
|
(35,135
|
)
|
||||
|
Unrealized gains on available-for-sale securities and other
|
|
1,872
|
|
|
547
|
|
|
2,359
|
|
|
15
|
|
||||
|
Amounts reclassified to net income (loss):
|
|
|
|
|
|
|
|
|
||||||||
|
Realized gains on available-for-sale securities
|
|
(17
|
)
|
|
(3
|
)
|
|
(566
|
)
|
|
(3
|
)
|
||||
|
Total other comprehensive income (loss), net of tax
|
|
4,751
|
|
|
(43,183
|
)
|
|
5,600
|
|
|
(35,123
|
)
|
||||
|
Comprehensive income (loss)
|
|
(309
|
)
|
|
34,501
|
|
|
15,548
|
|
|
21,390
|
|
||||
|
Less: Comprehensive income (loss) attributable to noncontrolling interests
|
|
632
|
|
|
(123
|
)
|
|
1,438
|
|
|
43
|
|
||||
|
Comprehensive income (loss) attributable to EchoStar Corporation
|
|
$
|
(941
|
)
|
|
$
|
34,624
|
|
|
$
|
14,110
|
|
|
$
|
21,347
|
|
|
|
|
Class
A and B Common Stock |
|
Additional
Paid-In Capital |
|
Accumulated
Other Comprehensive Loss |
|
Accumulated
Earnings |
|
Treasury
Stock |
|
Noncontrolling
Interests |
|
Total
|
||||||||||||||
|
Balance, March 31, 2018
|
|
$
|
102
|
|
|
$
|
3,685,577
|
|
|
$
|
(111,413
|
)
|
|
$
|
714,423
|
|
|
$
|
(98,162
|
)
|
|
$
|
14,988
|
|
|
$
|
4,205,515
|
|
|
Issuances of Class A common stock:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Exercise of stock options
|
|
—
|
|
|
589
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
589
|
|
|||||||
|
Employee Stock Purchase Plan
|
|
—
|
|
|
2,250
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,250
|
|
|||||||
|
Stock-based compensation
|
|
—
|
|
|
2,345
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,345
|
|
|||||||
|
R&D tax credits utilized by DISH Network
|
|
—
|
|
|
(1,580
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,580
|
)
|
|||||||
|
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
(42,457
|
)
|
|
—
|
|
|
—
|
|
|
(585
|
)
|
|
(43,042
|
)
|
|||||||
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
77,222
|
|
|
—
|
|
|
462
|
|
|
77,684
|
|
|||||||
|
Other, net
|
|
—
|
|
|
(1
|
)
|
|
(141
|
)
|
|
633
|
|
|
—
|
|
|
—
|
|
|
491
|
|
|||||||
|
Balance, June 30, 2018
|
|
$
|
102
|
|
|
$
|
3,689,180
|
|
|
$
|
(154,011
|
)
|
|
$
|
792,278
|
|
|
$
|
(98,162
|
)
|
|
$
|
14,865
|
|
|
$
|
4,244,252
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Balance, March 31, 2019
|
|
$
|
102
|
|
|
$
|
3,713,777
|
|
|
$
|
(124,251
|
)
|
|
$
|
709,928
|
|
|
$
|
(131,454
|
)
|
|
$
|
11,434
|
|
|
$
|
4,179,536
|
|
|
Issuances of Class A common stock:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Exercise of stock options
|
|
2
|
|
|
59,455
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
59,457
|
|
|||||||
|
Employee Stock Purchase Plan
|
|
—
|
|
|
2,325
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,325
|
|
|||||||
|
Stock-based compensation
|
|
—
|
|
|
2,205
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,205
|
|
|||||||
|
R&D tax credits utilized by DISH Network
|
|
—
|
|
|
(263
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(263
|
)
|
|||||||
|
Other comprehensive income
|
|
—
|
|
|
—
|
|
|
4,751
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,751
|
|
|||||||
|
Net income (loss)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,692
|
)
|
|
—
|
|
|
632
|
|
|
(5,060
|
)
|
|||||||
|
Balance, June 30, 2019
|
|
$
|
104
|
|
|
$
|
3,777,499
|
|
|
$
|
(119,500
|
)
|
|
$
|
704,236
|
|
|
$
|
(131,454
|
)
|
|
$
|
12,066
|
|
|
$
|
4,242,951
|
|
|
|
|
Class
A and B Common Stock |
|
Additional
Paid-In Capital |
|
Accumulated
Other Comprehensive Loss |
|
Accumulated
Earnings |
|
Treasury
Stock |
|
Noncontrolling
Interests |
|
Total
|
||||||||||||||
|
Balance, December 31, 2017
|
|
$
|
102
|
|
|
$
|
3,669,461
|
|
|
$
|
(130,154
|
)
|
|
$
|
721,316
|
|
|
$
|
(98,162
|
)
|
|
$
|
14,822
|
|
|
$
|
4,177,385
|
|
|
Cumulative effect of accounting changes as of January 1, 2018
|
|
—
|
|
|
—
|
|
|
10,467
|
|
|
14,658
|
|
|
—
|
|
|
—
|
|
|
25,125
|
|
|||||||
|
Balance, January 1, 2018
|
|
102
|
|
|
3,669,461
|
|
|
(119,687
|
)
|
|
735,974
|
|
|
(98,162
|
)
|
|
14,822
|
|
|
4,202,510
|
|
|||||||
|
Issuances of Class A common stock:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Exercise of stock options
|
|
—
|
|
|
4,045
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,045
|
|
|||||||
|
Employee benefits
|
|
—
|
|
|
7,605
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,605
|
|
|||||||
|
Employee Stock Purchase Plan
|
|
—
|
|
|
4,886
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,886
|
|
|||||||
|
Stock-based compensation
|
|
—
|
|
|
5,110
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,110
|
|
|||||||
|
R&D tax credits utilized by DISH Network
|
|
—
|
|
|
(1,798
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,798
|
)
|
|||||||
|
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
(34,083
|
)
|
|
—
|
|
|
—
|
|
|
(799
|
)
|
|
(34,882
|
)
|
|||||||
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
55,671
|
|
|
—
|
|
|
842
|
|
|
56,513
|
|
|||||||
|
Other, net
|
|
—
|
|
|
(129
|
)
|
|
(241
|
)
|
|
633
|
|
|
—
|
|
|
—
|
|
|
263
|
|
|||||||
|
Balance, June 30, 2018
|
|
$
|
102
|
|
|
$
|
3,689,180
|
|
|
$
|
(154,011
|
)
|
|
$
|
792,278
|
|
|
$
|
(98,162
|
)
|
|
$
|
14,865
|
|
|
$
|
4,244,252
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
Balance, December 31, 2018
|
|
$
|
102
|
|
|
$
|
3,702,522
|
|
|
$
|
(125,100
|
)
|
|
$
|
694,129
|
|
|
$
|
(131,454
|
)
|
|
$
|
15,275
|
|
|
$
|
4,155,474
|
|
|
Issuances of Class A common stock:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Exercise of stock options
|
|
2
|
|
|
61,501
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
61,503
|
|
|||||||
|
Employee benefits
|
|
—
|
|
|
6,654
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6,654
|
|
|||||||
|
Employee Stock Purchase Plan
|
|
—
|
|
|
5,074
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,074
|
|
|||||||
|
Stock-based compensation
|
|
—
|
|
|
4,833
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,833
|
|
|||||||
|
R&D tax credits utilized by DISH Network
|
|
—
|
|
|
(419
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(419
|
)
|
|||||||
|
Purchase of noncontrolling interest
|
|
—
|
|
|
(2,666
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,647
|
)
|
|
(7,313
|
)
|
|||||||
|
Other comprehensive income
|
|
—
|
|
|
—
|
|
|
5,600
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,600
|
|
|||||||
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,510
|
|
|
—
|
|
|
1,438
|
|
|
9,948
|
|
|||||||
|
Other, net
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,597
|
|
|
—
|
|
|
—
|
|
|
1,597
|
|
|||||||
|
Balance, June 30, 2019
|
|
$
|
104
|
|
|
$
|
3,777,499
|
|
|
$
|
(119,500
|
)
|
|
$
|
704,236
|
|
|
$
|
(131,454
|
)
|
|
$
|
12,066
|
|
|
$
|
4,242,951
|
|
|
|
|
For the six months ended June 30,
|
||||||
|
|
|
2019
|
|
2018
|
||||
|
Cash flows from operating activities:
|
|
|
|
|
|
|
||
|
Net income
|
|
$
|
9,948
|
|
|
$
|
56,513
|
|
|
Adjustments to reconcile net income to net cash flows from operating activities:
|
|
|
|
|
|
|
||
|
Depreciation and amortization
|
|
309,631
|
|
|
294,003
|
|
||
|
Equity in losses of unconsolidated affiliates, net
|
|
11,107
|
|
|
3,067
|
|
||
|
Amortization of debt issuance costs
|
|
3,872
|
|
|
3,905
|
|
||
|
(Gains) losses on investments, net
|
|
(19,791
|
)
|
|
(28,674
|
)
|
||
|
Stock-based compensation
|
|
4,833
|
|
|
5,110
|
|
||
|
Deferred tax provision
|
|
7,014
|
|
|
10,231
|
|
||
|
Dividend received from unconsolidated entity
|
|
—
|
|
|
5,000
|
|
||
|
Changes in current assets and current liabilities, net:
|
|
|
|
|
||||
|
Trade accounts receivable, net
|
|
167
|
|
|
(3,061
|
)
|
||
|
Trade accounts receivable - DISH Network
|
|
257
|
|
|
17,262
|
|
||
|
Inventory
|
|
2,114
|
|
|
238
|
|
||
|
Other current assets
|
|
(2,500
|
)
|
|
(5,430
|
)
|
||
|
Trade accounts payable
|
|
(225
|
)
|
|
2,364
|
|
||
|
Trade accounts payable - DISH Network
|
|
(585
|
)
|
|
(3,360
|
)
|
||
|
Accrued expenses and other
|
|
51,409
|
|
|
7,749
|
|
||
|
Changes in noncurrent assets and noncurrent liabilities, net
|
|
1,374
|
|
|
(17,200
|
)
|
||
|
Other, net
|
|
2,149
|
|
|
5,822
|
|
||
|
Net cash flows from operating activities
|
|
380,774
|
|
|
353,539
|
|
||
|
Cash flows from investing activities:
|
|
|
|
|
|
|
||
|
Purchases of marketable investment securities
|
|
(504,264
|
)
|
|
(1,632,930
|
)
|
||
|
Sales and maturities of marketable investment securities
|
|
1,621,481
|
|
|
841,638
|
|
||
|
Expenditures for property and equipment
|
|
(219,440
|
)
|
|
(248,098
|
)
|
||
|
Refunds and other receipts related to property and equipment
|
|
—
|
|
|
77,524
|
|
||
|
Expenditures for externally marketed software
|
|
(15,329
|
)
|
|
(15,000
|
)
|
||
|
Net cash flows from investing activities
|
|
882,448
|
|
|
(976,866
|
)
|
||
|
Cash flows from financing activities:
|
|
|
|
|
|
|
||
|
Repayment of debt and finance lease obligations
|
|
(21,180
|
)
|
|
(18,417
|
)
|
||
|
Repurchase and maturity of debt
|
|
(920,923
|
)
|
|
—
|
|
||
|
Purchase of noncontrolling interest
|
|
(7,313
|
)
|
|
—
|
|
||
|
Repayment of in-orbit incentive obligations
|
|
(3,778
|
)
|
|
(3,272
|
)
|
||
|
Net proceeds from Class A common stock options exercised
|
|
61,503
|
|
|
4,064
|
|
||
|
Net proceeds from Class A common stock issued under the Employee Stock Purchase Plan
|
|
5,074
|
|
|
4,886
|
|
||
|
Other, net
|
|
905
|
|
|
(401
|
)
|
||
|
Net cash flows from financing activities
|
|
(885,712
|
)
|
|
(13,140
|
)
|
||
|
Effect of exchange rates on cash and cash equivalents
|
|
121
|
|
|
(1,941
|
)
|
||
|
Net increase (decrease) in cash and cash equivalents, including restricted amounts
|
|
377,631
|
|
|
(638,408
|
)
|
||
|
Cash and cash equivalents, including restricted amounts, beginning of period
|
|
929,495
|
|
|
2,432,249
|
|
||
|
Cash and cash equivalents, including restricted amounts, end of period
|
|
$
|
1,307,126
|
|
|
$
|
1,793,841
|
|
|
|
|
|
|
|
||||
|
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
||
|
Cash paid for interest, net of amounts capitalized
|
|
$
|
120,625
|
|
|
$
|
122,017
|
|
|
Cash paid for income taxes
|
|
$
|
1,217
|
|
|
$
|
2,574
|
|
|
•
|
Hughes — which provides broadband satellite technologies and broadband internet services to domestic and international home and small office customers and broadband network technologies, managed services, equipment, hardware, satellite services and communication solutions to domestic and international consumers and aeronautical, enterprise and government customers. The Hughes segment also designs, provides and installs gateway and terminal equipment to customers for other satellite systems. In addition, our Hughes segment designs, develops, constructs and provides telecommunication networks comprising satellite ground segment systems and terminals to mobile system operators and our enterprise customers.
|
|
•
|
EchoStar Satellite Services (“ESS”) — which uses certain of our owned and leased in-orbit satellites and related licenses to provide satellite operations and satellite services on a full-time and/or occasional-use basis primarily to DISH Network, our joint venture Dish Mexico, S. de R.L. de C.V., (“Dish Mexico”), United States (“U.S.”) government service providers, internet service providers, broadcast news organizations, content providers and private enterprise customers.
|
|
|
|
As Reported December 31,2018
|
|
Adoption of ASC 842 Increase (Decrease)
|
|
Balance January 1, 2019
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Prepaids and deposits
|
|
$
|
61,177
|
|
|
$
|
(28
|
)
|
|
$
|
61,149
|
|
|
Operating lease right-of-use assets
|
|
$
|
—
|
|
|
$
|
120,358
|
|
|
$
|
120,358
|
|
|
Other noncurrent assets, net
|
|
$
|
263,892
|
|
|
$
|
(7,272
|
)
|
|
$
|
256,620
|
|
|
Total assets
|
|
$
|
8,661,294
|
|
|
$
|
113,058
|
|
|
$
|
8,774,352
|
|
|
Accrued expenses and other
|
|
$
|
72,470
|
|
|
$
|
17,453
|
|
|
$
|
89,923
|
|
|
Operating lease liabilities
|
|
$
|
—
|
|
|
$
|
100,085
|
|
|
$
|
100,085
|
|
|
Other noncurrent liabilities
|
|
$
|
121,546
|
|
|
$
|
(3,871
|
)
|
|
$
|
117,675
|
|
|
Total liabilities
|
|
$
|
4,505,820
|
|
|
$
|
113,667
|
|
|
$
|
4,619,487
|
|
|
Accumulated earnings
|
|
$
|
694,129
|
|
|
$
|
(609
|
)
|
|
$
|
693,520
|
|
|
Total stockholders’ equity
|
|
$
|
4,155,474
|
|
|
$
|
(609
|
)
|
|
$
|
4,154,865
|
|
|
Total liabilities and stockholders’ equity
|
|
$
|
8,661,294
|
|
|
$
|
113,058
|
|
|
$
|
8,774,352
|
|
|
|
|
As of
|
||||||
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
|
|
|
|
|
|
||||
|
Trade accounts receivable:
|
|
|
|
|
||||
|
Sales and services
|
|
$
|
161,771
|
|
|
$
|
154,415
|
|
|
Leasing
|
|
7,901
|
|
|
7,990
|
|
||
|
Total
|
|
169,672
|
|
|
162,405
|
|
||
|
Contract assets
|
|
57,475
|
|
|
55,295
|
|
||
|
Allowance for doubtful accounts
|
|
(25,586
|
)
|
|
(16,604
|
)
|
||
|
Total trade accounts receivable and contract assets, net
|
|
$
|
201,561
|
|
|
$
|
201,096
|
|
|
|
|
|
|
|
||||
|
Trade accounts receivable - DISH Network:
|
|
|
|
|
||||
|
Sales and services
|
|
$
|
12,004
|
|
|
$
|
12,274
|
|
|
Leasing
|
|
1,939
|
|
|
1,926
|
|
||
|
Total trade accounts receivable - DISH Network, net
|
|
$
|
13,943
|
|
|
$
|
14,200
|
|
|
|
|
|
|
|
||||
|
Contract liabilities:
|
|
|
|
|
||||
|
Current
|
|
$
|
106,308
|
|
|
$
|
72,284
|
|
|
Noncurrent
|
|
9,376
|
|
|
10,133
|
|
||
|
Total contract liabilities
|
|
$
|
115,684
|
|
|
$
|
82,417
|
|
|
|
|
Hughes
|
|
ESS
|
|
Corporate and Other
|
|
Consolidated
Total |
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
For the three months ended June 30, 2019
|
|
|
|
|
|
|
|
|
||||||||
|
North America
|
|
$
|
372,398
|
|
|
$
|
80,785
|
|
|
$
|
4,492
|
|
|
$
|
457,675
|
|
|
South and Central America
|
|
30,395
|
|
|
—
|
|
|
—
|
|
|
30,395
|
|
||||
|
All other
|
|
49,054
|
|
|
176
|
|
|
(176
|
)
|
|
49,054
|
|
||||
|
Total revenue
|
|
$
|
451,847
|
|
|
$
|
80,961
|
|
|
$
|
4,316
|
|
|
$
|
537,124
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
For the three months ended June 30, 2018
|
|
|
|
|
|
|
|
|
||||||||
|
North America
|
|
$
|
362,707
|
|
|
$
|
95,249
|
|
|
$
|
4,402
|
|
|
$
|
462,358
|
|
|
South and Central America
|
|
23,732
|
|
|
—
|
|
|
—
|
|
|
23,732
|
|
||||
|
All other
|
|
39,867
|
|
|
176
|
|
|
(176
|
)
|
|
39,867
|
|
||||
|
Total revenue
|
|
$
|
426,306
|
|
|
$
|
95,425
|
|
|
$
|
4,226
|
|
|
$
|
525,957
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
For the six months ended June 30, 2019
|
|
|
|
|
|
|
|
|
||||||||
|
North America
|
|
$
|
740,227
|
|
|
$
|
161,869
|
|
|
$
|
9,153
|
|
|
$
|
911,249
|
|
|
South and Central America
|
|
57,258
|
|
|
—
|
|
|
—
|
|
|
57,258
|
|
||||
|
All other
|
|
99,699
|
|
|
351
|
|
|
(351
|
)
|
|
99,699
|
|
||||
|
Total revenue
|
|
$
|
897,184
|
|
|
$
|
162,220
|
|
|
$
|
8,802
|
|
|
$
|
1,068,206
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
For the six months ended June 30, 2018
|
|
|
|
|
|
|
|
|
||||||||
|
North America
|
|
$
|
698,727
|
|
|
$
|
191,827
|
|
|
$
|
8,798
|
|
|
$
|
899,352
|
|
|
South and Central America
|
|
48,220
|
|
|
—
|
|
|
—
|
|
|
48,220
|
|
||||
|
All other
|
|
80,177
|
|
|
351
|
|
|
(351
|
)
|
|
80,177
|
|
||||
|
Total revenue
|
|
$
|
827,124
|
|
|
$
|
192,178
|
|
|
$
|
8,447
|
|
|
$
|
1,027,749
|
|
|
|
|
Hughes
|
|
ESS
|
|
Corporate and Other
|
|
Consolidated
Total |
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
For the three months ended June 30, 2019
|
|
|
|
|
|
|
|
|
||||||||
|
Equipment
|
|
$
|
30,597
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
30,597
|
|
|
Services
|
|
381,608
|
|
|
3,315
|
|
|
1,716
|
|
|
386,639
|
|
||||
|
Design, development and construction services
|
|
25,860
|
|
|
—
|
|
|
—
|
|
|
25,860
|
|
||||
|
Revenue from sales and services
|
|
438,065
|
|
|
3,315
|
|
|
1,716
|
|
|
443,096
|
|
||||
|
Lease revenue
|
|
13,782
|
|
|
77,646
|
|
|
2,600
|
|
|
94,028
|
|
||||
|
Total revenue
|
|
$
|
451,847
|
|
|
$
|
80,961
|
|
|
$
|
4,316
|
|
|
$
|
537,124
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
For the three months ended June 30, 2018
|
|
|
|
|
|
|
|
|
||||||||
|
Equipment
|
|
$
|
36,465
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
36,465
|
|
|
Services
|
|
324,101
|
|
|
6,890
|
|
|
1,435
|
|
|
332,426
|
|
||||
|
Design, development and construction services
|
|
13,876
|
|
|
—
|
|
|
—
|
|
|
13,876
|
|
||||
|
Revenue from sales and services
|
|
374,442
|
|
|
6,890
|
|
|
1,435
|
|
|
382,767
|
|
||||
|
Lease revenue
|
|
51,864
|
|
|
88,535
|
|
|
2,791
|
|
|
143,190
|
|
||||
|
Total revenue
|
|
$
|
426,306
|
|
|
$
|
95,425
|
|
|
$
|
4,226
|
|
|
$
|
525,957
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
For the six months ended June 30, 2019
|
|
|
|
|
|
|
|
|
||||||||
|
Equipment
|
|
$
|
56,557
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
56,557
|
|
|
Services
|
|
762,391
|
|
|
7,055
|
|
|
3,452
|
|
|
772,898
|
|
||||
|
Design, development and construction services
|
|
50,926
|
|
|
—
|
|
|
—
|
|
|
50,926
|
|
||||
|
Revenue from sales and services
|
|
869,874
|
|
|
7,055
|
|
|
3,452
|
|
|
880,381
|
|
||||
|
Lease revenue
|
|
27,310
|
|
|
155,165
|
|
|
5,350
|
|
|
187,825
|
|
||||
|
Total revenue
|
|
$
|
897,184
|
|
|
$
|
162,220
|
|
|
$
|
8,802
|
|
|
$
|
1,068,206
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
For the six months ended June 30, 2018
|
|
|
|
|
|
|
|
|
||||||||
|
Equipment
|
|
$
|
63,236
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
63,236
|
|
|
Services
|
|
638,062
|
|
|
14,293
|
|
|
2,910
|
|
|
655,265
|
|
||||
|
Design, development and construction services
|
|
30,052
|
|
|
—
|
|
|
—
|
|
|
30,052
|
|
||||
|
Revenue from sales and services
|
|
731,350
|
|
|
14,293
|
|
|
2,910
|
|
|
748,553
|
|
||||
|
Lease revenue
|
|
95,774
|
|
|
177,885
|
|
|
5,537
|
|
|
279,196
|
|
||||
|
Total revenue
|
|
$
|
827,124
|
|
|
$
|
192,178
|
|
|
$
|
8,447
|
|
|
$
|
1,027,749
|
|
|
|
|
As of
June 30, 2019 |
||
|
|
|
|
||
|
Right-of-use assets:
|
|
|
||
|
Operating
|
|
$
|
113,643
|
|
|
Finance
|
|
544,565
|
|
|
|
Total right-of-use assets
|
|
$
|
658,208
|
|
|
|
|
|
||
|
Lease liabilities:
|
|
|
||
|
Current:
|
|
|
||
|
Operating
|
|
$
|
16,181
|
|
|
Finance
|
|
42,682
|
|
|
|
Noncurrent:
|
|
|
||
|
Operating
|
|
94,979
|
|
|
|
Finance
|
|
166,225
|
|
|
|
Total lease liabilities
|
|
$
|
320,067
|
|
|
|
|
For the three months ended June 30, 2019
|
|
For the six months ended June 30, 2019
|
||||
|
|
|
|
|
|
||||
|
Lease cost:
|
|
|
|
|
||||
|
Operating lease cost
|
|
$
|
6,411
|
|
|
$
|
12,278
|
|
|
Finance lease cost:
|
|
|
|
|
||||
|
Amortization of right-of-use assets
|
|
20,577
|
|
|
41,242
|
|
||
|
Interest on lease liabilities
|
|
5,770
|
|
|
11,788
|
|
||
|
Short-term lease cost
|
|
156
|
|
|
276
|
|
||
|
Variable lease cost
|
|
1,422
|
|
|
3,392
|
|
||
|
Total lease cost
|
|
$
|
34,336
|
|
|
$
|
68,976
|
|
|
|
|
As of
June 30, 2019 |
|
|
|
|
|
|
|
Lease term and discount rate:
|
|
|
|
|
Weighted average remaining lease term (in years):
|
|
|
|
|
Finance leases
|
|
4.35
|
|
|
Operating leases
|
|
10.16
|
|
|
|
|
|
|
|
Weighted average discount rate:
|
|
|
|
|
Finance leases
|
|
10.77
|
%
|
|
Operating leases
|
|
6.18
|
%
|
|
|
|
For the three months ended June 30, 2019
|
|
For the six months ended June 30, 2019
|
||||
|
|
|
|
|
|
||||
|
Cash paid for amounts included in the measurement of lease liabilities:
|
|
|
|
|
||||
|
Operating cash flows from operating leases
|
|
$
|
6,046
|
|
|
$
|
11,417
|
|
|
Operating cash flows from finance leases
|
|
$
|
5,770
|
|
|
$
|
11,788
|
|
|
Financing cash flows from finance leases
|
|
$
|
10,022
|
|
|
$
|
19,780
|
|
|
|
|
Operating Leases
|
|
Finance Leases
|
|
Total
|
||||||
|
|
|
|
|
|
|
|
||||||
|
Year ending December 31,
|
|
|
|
|
|
|
||||||
|
2019 (remainder)
|
|
$
|
11,811
|
|
|
$
|
31,591
|
|
|
$
|
43,402
|
|
|
2020
|
|
19,858
|
|
|
63,266
|
|
|
83,124
|
|
|||
|
2021
|
|
16,403
|
|
|
59,692
|
|
|
76,095
|
|
|||
|
2022
|
|
14,209
|
|
|
41,040
|
|
|
55,249
|
|
|||
|
2023
|
|
13,373
|
|
|
40,942
|
|
|
54,315
|
|
|||
|
After 2023
|
|
75,926
|
|
|
30,707
|
|
|
106,633
|
|
|||
|
Total lease payments
|
|
151,580
|
|
|
267,238
|
|
|
418,818
|
|
|||
|
Less: Interest
|
|
(40,420
|
)
|
|
(58,331
|
)
|
|
(98,751
|
)
|
|||
|
Present value of lease liabilities
|
|
$
|
111,160
|
|
|
$
|
208,907
|
|
|
$
|
320,067
|
|
|
|
|
Amounts
|
||
|
|
|
|
||
|
Year ending December 31,
|
|
|
||
|
2019
|
|
$
|
21,146
|
|
|
2020
|
|
18,081
|
|
|
|
2021
|
|
13,873
|
|
|
|
2022
|
|
10,118
|
|
|
|
2023
|
|
8,814
|
|
|
|
Thereafter
|
|
21,886
|
|
|
|
Total
|
|
$
|
93,918
|
|
|
|
|
For the three months ended June 30, 2019
|
|
For the six months ended June 30, 2019
|
||||
|
|
|
|
|
|
||||
|
Sales-type lease revenue:
|
|
|
|
|
||||
|
Revenue at lease commencement
|
|
$
|
1,188
|
|
|
$
|
1,876
|
|
|
Interest income
|
|
258
|
|
|
510
|
|
||
|
|
|
|
|
|
||||
|
Operating lease revenue
|
|
92,582
|
|
|
185,439
|
|
||
|
Total lease revenue
|
|
$
|
94,028
|
|
|
$
|
187,825
|
|
|
|
|
Amounts
|
||
|
|
|
|
||
|
Year ending December 31,
|
|
|
||
|
2019 (remainder)
|
|
$
|
152,187
|
|
|
2020
|
|
260,881
|
|
|
|
2021
|
|
229,209
|
|
|
|
2022
|
|
150,899
|
|
|
|
2023
|
|
41,011
|
|
|
|
After 2023
|
|
194,910
|
|
|
|
Total lease payments
|
|
$
|
1,029,097
|
|
|
|
|
As of June 30, 2019
|
|
For the three months ended June 30, 2019
|
|
For the six months ended June 30, 2019
|
||||||||||||||
|
|
|
Cost
|
|
Accumulated Depreciation
|
|
Net
|
|
Depreciation Expense
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Customer premises equipment
|
|
$
|
1,270,959
|
|
|
$
|
953,646
|
|
|
$
|
317,313
|
|
|
$
|
46,839
|
|
|
$
|
92,651
|
|
|
Satellites
|
|
1,552,245
|
|
|
879,760
|
|
|
672,485
|
|
|
32,600
|
|
|
65,201
|
|
|||||
|
Real estate
|
|
100,049
|
|
|
30,836
|
|
|
69,213
|
|
|
558
|
|
|
1,116
|
|
|||||
|
Total
|
|
$
|
2,923,253
|
|
|
$
|
1,864,242
|
|
|
$
|
1,059,011
|
|
|
$
|
79,997
|
|
|
$
|
158,968
|
|
|
|
|
For the three months
ended June 30, |
|
For the six months
ended June 30, |
||||||||||||
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Net income (loss) attributable to EchoStar Corporation common stock
|
|
$
|
(5,692
|
)
|
|
$
|
77,222
|
|
|
$
|
8,510
|
|
|
$
|
55,671
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Weighted-average common shares outstanding:
|
|
|
|
|
|
|
|
|
||||||||
|
Class A and B common stock:
|
|
|
|
|
|
|
|
|
||||||||
|
Basic
|
|
96,415
|
|
|
96,091
|
|
|
95,903
|
|
|
95,990
|
|
||||
|
Dilutive impact of stock awards outstanding
|
|
—
|
|
|
855
|
|
|
291
|
|
|
1,048
|
|
||||
|
Diluted
|
|
96,415
|
|
|
96,946
|
|
|
96,194
|
|
|
97,038
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Earnings per share:
|
|
|
|
|
|
|
|
|
||||||||
|
Class A and B common stock:
|
|
|
|
|
|
|
|
|
||||||||
|
Basic
|
|
$
|
(0.06
|
)
|
|
$
|
0.80
|
|
|
$
|
0.09
|
|
|
$
|
0.58
|
|
|
Diluted
|
|
$
|
(0.06
|
)
|
|
$
|
0.80
|
|
|
$
|
0.09
|
|
|
$
|
0.57
|
|
|
|
|
Cumulative Foreign Currency Translation Losses
|
|
Unrealized Gain (Loss) On Available-For-Sale Securities
|
|
Other
|
|
Accumulated
Other Comprehensive Loss |
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Balance, December 31, 2017
|
|
$
|
(119,430
|
)
|
|
$
|
(10,801
|
)
|
|
$
|
77
|
|
|
$
|
(130,154
|
)
|
|
Cumulative effect of accounting changes as of January 1, 2018
|
|
—
|
|
|
10,467
|
|
|
—
|
|
|
10,467
|
|
||||
|
Balance, January 1, 2018
|
|
(119,430
|
)
|
|
(334
|
)
|
|
77
|
|
|
(119,687
|
)
|
||||
|
Other comprehensive income (loss) before reclassifications
|
|
(34,336
|
)
|
|
256
|
|
|
(241
|
)
|
|
(34,321
|
)
|
||||
|
Amounts reclassified to net income
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
||||
|
Other comprehensive income (loss)
|
|
(34,336
|
)
|
|
253
|
|
|
(241
|
)
|
|
(34,324
|
)
|
||||
|
Balance, June 30, 2018
|
|
$
|
(153,766
|
)
|
|
$
|
(81
|
)
|
|
$
|
(164
|
)
|
|
$
|
(154,011
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Balance, December 31, 2018
|
|
$
|
(121,693
|
)
|
|
$
|
(1,574
|
)
|
|
$
|
(1,833
|
)
|
|
$
|
(125,100
|
)
|
|
Other comprehensive income (loss) before reclassifications
|
|
3,807
|
|
|
3,291
|
|
|
(932
|
)
|
|
6,166
|
|
||||
|
Amounts reclassified to net income
|
|
—
|
|
|
(566
|
)
|
|
—
|
|
|
(566
|
)
|
||||
|
Other comprehensive income (loss)
|
|
3,807
|
|
|
2,725
|
|
|
(932
|
)
|
|
5,600
|
|
||||
|
Balance, June 30, 2019
|
|
$
|
(117,886
|
)
|
|
$
|
1,151
|
|
|
$
|
(2,765
|
)
|
|
$
|
(119,500
|
)
|
|
|
|
As of
|
||||||
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
|
|
|
|
|
|
||||
|
Marketable investment securities:
|
|
|
|
|
||||
|
Debt securities:
|
|
|
|
|
||||
|
Corporate bonds
|
|
$
|
891,695
|
|
|
$
|
1,735,653
|
|
|
Other debt securities
|
|
277,568
|
|
|
464,997
|
|
||
|
Total debt securities
|
|
1,169,263
|
|
|
2,200,650
|
|
||
|
Equity securities
|
|
52,753
|
|
|
90,976
|
|
||
|
Total marketable investment securities
|
|
1,222,016
|
|
|
2,291,626
|
|
||
|
Less: Restricted marketable investment securities
|
|
18,708
|
|
|
9,474
|
|
||
|
Total marketable investment securities
|
|
$
|
1,203,308
|
|
|
$
|
2,282,152
|
|
|
|
|
Amortized
|
|
Unrealized
|
|
Estimated
|
||||||||||
|
|
|
Cost
|
|
Gains
|
|
Losses
|
|
Fair Value
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
As of June 30, 2019
|
|
|
|
|
|
|
|
|
||||||||
|
Corporate bonds
|
|
$
|
883,857
|
|
|
$
|
1,263
|
|
|
$
|
(141
|
)
|
|
$
|
884,979
|
|
|
Other debt securities
|
|
277,539
|
|
|
29
|
|
|
—
|
|
|
277,568
|
|
||||
|
Total available-for-sale debt securities
|
|
$
|
1,161,396
|
|
|
$
|
1,292
|
|
|
$
|
(141
|
)
|
|
$
|
1,162,547
|
|
|
As of December 31, 2018
|
|
|
|
|
|
|
|
|
||||||||
|
Corporate bonds
|
|
$
|
1,689,093
|
|
|
$
|
318
|
|
|
$
|
(1,896
|
)
|
|
$
|
1,687,515
|
|
|
Other debt securities
|
|
464,993
|
|
|
7
|
|
|
(3
|
)
|
|
464,997
|
|
||||
|
Total available-for-sale debt securities
|
|
$
|
2,154,086
|
|
|
$
|
325
|
|
|
$
|
(1,899
|
)
|
|
$
|
2,152,512
|
|
|
|
|
As of
|
||||||||||||||||||||||
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
|
|
Level 1
|
|
Level 2
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Total
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Debt securities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Corporate bonds
|
|
$
|
—
|
|
|
$
|
891,695
|
|
|
$
|
891,695
|
|
|
$
|
—
|
|
|
$
|
1,735,653
|
|
|
$
|
1,735,653
|
|
|
Other debt securities
|
|
18,708
|
|
|
258,860
|
|
|
277,568
|
|
|
9,474
|
|
|
455,523
|
|
|
464,997
|
|
||||||
|
Total debt securities
|
|
18,708
|
|
|
1,150,555
|
|
|
1,169,263
|
|
|
9,474
|
|
|
2,191,176
|
|
|
2,200,650
|
|
||||||
|
Equity securities
|
|
46,127
|
|
|
6,626
|
|
|
52,753
|
|
|
85,298
|
|
|
5,678
|
|
|
90,976
|
|
||||||
|
Total marketable investment securities
|
|
$
|
64,835
|
|
|
$
|
1,157,181
|
|
|
$
|
1,222,016
|
|
|
$
|
94,772
|
|
|
$
|
2,196,854
|
|
|
$
|
2,291,626
|
|
|
|
|
As of
|
||||||
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
|
|
|
|
|
|
||||
|
Raw materials
|
|
$
|
3,901
|
|
|
$
|
4,856
|
|
|
Work-in-process
|
|
8,933
|
|
|
13,901
|
|
||
|
Finished goods
|
|
60,511
|
|
|
56,622
|
|
||
|
Total inventory
|
|
$
|
73,345
|
|
|
$
|
75,379
|
|
|
|
|
Depreciable Life In Years
|
|
As of
|
||||||
|
|
|
|
June 30, 2019
|
|
December 31, 2018
|
|||||
|
|
|
|
|
|
|
|
||||
|
Land
|
|
—
|
|
$
|
33,600
|
|
|
$
|
33,606
|
|
|
Buildings and improvements
|
|
1 to 40
|
|
174,260
|
|
|
174,227
|
|
||
|
Furniture, fixtures, equipment and other
|
|
1 to 12
|
|
830,040
|
|
|
812,566
|
|
||
|
Customer premises equipment
|
|
2 to 4
|
|
1,270,959
|
|
|
1,159,977
|
|
||
|
Satellites - owned
|
|
2 to 15
|
|
2,816,628
|
|
|
2,816,628
|
|
||
|
Satellites - acquired under finance leases
|
|
10 to 15
|
|
1,052,592
|
|
|
1,051,110
|
|
||
|
Construction in progress
|
|
—
|
|
368,345
|
|
|
307,026
|
|
||
|
Total property and equipment
|
|
|
|
6,546,424
|
|
|
6,355,140
|
|
||
|
Accumulated depreciation
|
|
|
|
(3,216,630
|
)
|
|
(2,940,232
|
)
|
||
|
Property and equipment, net
|
|
|
|
$
|
3,329,794
|
|
|
$
|
3,414,908
|
|
|
|
|
As of
|
||||||
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
|
|
|
|
|
|
||||
|
Progress amounts for satellite construction
|
|
$
|
332,772
|
|
|
$
|
277,583
|
|
|
Satellite related equipment
|
|
18,904
|
|
|
13,001
|
|
||
|
Other
|
|
16,669
|
|
|
16,442
|
|
||
|
Construction in progress
|
|
$
|
368,345
|
|
|
$
|
307,026
|
|
|
|
|
For the three months
ended June 30, |
|
For the six months
ended June 30, |
||||||||||||
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Buildings and improvements
|
|
$
|
3,882
|
|
|
$
|
4,376
|
|
|
$
|
7,369
|
|
|
$
|
6,085
|
|
|
Furniture, fixtures, equipment and other
|
|
19,955
|
|
|
19,517
|
|
|
40,605
|
|
|
41,213
|
|
||||
|
Customer premises equipment
|
|
47,275
|
|
|
42,875
|
|
|
93,467
|
|
|
86,323
|
|
||||
|
Satellites
|
|
73,404
|
|
|
71,042
|
|
|
146,896
|
|
|
139,203
|
|
||||
|
Total depreciation expense
|
|
$
|
144,516
|
|
|
$
|
137,810
|
|
|
$
|
288,337
|
|
|
$
|
272,824
|
|
|
|
|
As of
|
||||||
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
|
|
|
|
|
|
||||
|
Investments in unconsolidated entities:
|
|
|
|
|
||||
|
Equity method
|
|
$
|
173,797
|
|
|
$
|
182,035
|
|
|
Other equity investments without a readily determinable fair value
|
|
51,785
|
|
|
80,438
|
|
||
|
Total investments in unconsolidated entities
|
|
$
|
225,582
|
|
|
$
|
262,473
|
|
|
|
|
Effective Interest Rate
|
|
As of
|
||||||||||||||
|
|
|
|
June 30, 2019
|
|
December 31, 2018
|
|||||||||||||
|
|
|
|
Carrying
Amount |
|
Fair
Value |
|
Carrying
Amount |
|
Fair
Value |
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Senior Secured Notes:
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
6 1/2% Senior Secured Notes due 2019
|
|
6.959%
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
920,836
|
|
|
$
|
932,696
|
|
|
5 1/4% Senior Secured Notes due 2026
|
|
5.320%
|
|
750,000
|
|
|
774,375
|
|
|
750,000
|
|
|
695,865
|
|
||||
|
Senior Unsecured Notes:
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
7 5/8% Senior Unsecured Notes due 2021
|
|
8.062%
|
|
900,000
|
|
|
970,515
|
|
|
900,000
|
|
|
934,902
|
|
||||
|
6 5/8% Senior Unsecured Notes due 2026
|
|
6.688%
|
|
750,000
|
|
|
791,708
|
|
|
750,000
|
|
|
696,353
|
|
||||
|
Less: Unamortized debt issuance costs
|
|
|
|
(12,873
|
)
|
|
—
|
|
|
(16,757
|
)
|
|
—
|
|
||||
|
Subtotal
|
|
|
|
2,387,127
|
|
|
$
|
2,536,598
|
|
|
3,304,079
|
|
|
$
|
3,259,816
|
|
||
|
Finance lease obligations
|
|
|
|
208,907
|
|
|
|
|
|
228,702
|
|
|
|
|
||||
|
Total debt and finance lease obligations
|
|
|
|
2,596,034
|
|
|
|
|
|
3,532,781
|
|
|
|
|
||||
|
Less: Current portion
|
|
|
|
(42,682
|
)
|
|
|
|
|
(959,577
|
)
|
|
|
|
||||
|
Long-term debt and finance lease obligations, net
|
|
|
|
$
|
2,553,352
|
|
|
|
|
|
$
|
2,573,204
|
|
|
|
|
||
|
|
|
For the three months
ended June 30, |
|
For the six months
ended June 30, |
||||||||||||
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Research and development expenses
|
|
$
|
81
|
|
|
$
|
150
|
|
|
$
|
242
|
|
|
$
|
341
|
|
|
Selling, general and administrative expenses
|
|
2,124
|
|
|
2,195
|
|
|
4,591
|
|
|
4,769
|
|
||||
|
Total stock-based compensation
|
|
$
|
2,205
|
|
|
$
|
2,345
|
|
|
$
|
4,833
|
|
|
$
|
5,110
|
|
|
|
|
Hughes
|
|
ESS
|
|
Corporate and Other
|
|
Consolidated
Total |
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
For the three months ended June 30, 2019
|
|
|
|
|
|
|
|
|
||||||||
|
External revenue
|
|
$
|
451,847
|
|
|
$
|
80,127
|
|
|
$
|
5,150
|
|
|
$
|
537,124
|
|
|
Intersegment revenue
|
|
—
|
|
|
834
|
|
|
(834
|
)
|
|
—
|
|
||||
|
Total revenue
|
|
$
|
451,847
|
|
|
$
|
80,961
|
|
|
$
|
4,316
|
|
|
$
|
537,124
|
|
|
EBITDA
|
|
$
|
131,765
|
|
|
$
|
68,174
|
|
|
$
|
(12,349
|
)
|
|
$
|
187,590
|
|
|
Capital expenditures
|
|
$
|
74,090
|
|
|
$
|
136
|
|
|
$
|
33,252
|
|
|
$
|
107,478
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
For the three months ended June 30, 2018
|
|
|
|
|
|
|
|
|
||||||||
|
External revenue
|
|
$
|
426,306
|
|
|
$
|
94,904
|
|
|
$
|
4,747
|
|
|
$
|
525,957
|
|
|
Intersegment revenue
|
|
—
|
|
|
521
|
|
|
(521
|
)
|
|
—
|
|
||||
|
Total revenue
|
|
$
|
426,306
|
|
|
$
|
95,425
|
|
|
$
|
4,226
|
|
|
$
|
525,957
|
|
|
EBITDA
|
|
$
|
152,134
|
|
|
$
|
82,483
|
|
|
$
|
51,137
|
|
|
$
|
285,754
|
|
|
Capital expenditures
|
|
$
|
87,511
|
|
|
$
|
356
|
|
|
$
|
31,725
|
|
|
$
|
119,592
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
For the six months ended June 30, 2019
|
|
|
|
|
|
|
|
|
||||||||
|
External revenue
|
|
$
|
897,184
|
|
|
$
|
160,680
|
|
|
$
|
10,342
|
|
|
$
|
1,068,206
|
|
|
Intersegment revenue
|
|
—
|
|
|
1,540
|
|
|
(1,540
|
)
|
|
—
|
|
||||
|
Total revenue
|
|
$
|
897,184
|
|
|
$
|
162,220
|
|
|
$
|
8,802
|
|
|
$
|
1,068,206
|
|
|
EBITDA
|
|
$
|
292,897
|
|
|
$
|
136,891
|
|
|
$
|
(30,142
|
)
|
|
$
|
399,646
|
|
|
Capital expenditures
|
|
$
|
147,911
|
|
|
$
|
244
|
|
|
$
|
71,285
|
|
|
$
|
219,440
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
For the six months ended June 30, 2018
|
|
|
|
|
|
|
|
|
||||||||
|
External revenue
|
|
$
|
826,765
|
|
|
$
|
191,127
|
|
|
$
|
9,857
|
|
|
$
|
1,027,749
|
|
|
Intersegment revenue
|
|
359
|
|
|
1,051
|
|
|
(1,410
|
)
|
|
—
|
|
||||
|
Total revenue
|
|
$
|
827,124
|
|
|
$
|
192,178
|
|
|
$
|
8,447
|
|
|
$
|
1,027,749
|
|
|
EBITDA
|
|
$
|
288,847
|
|
|
$
|
166,633
|
|
|
$
|
(4,010
|
)
|
|
$
|
451,470
|
|
|
Capital expenditures
|
|
$
|
174,802
|
|
|
$
|
(76,682
|
)
|
|
$
|
72,454
|
|
|
$
|
170,574
|
|
|
|
|
For the three months
ended June 30, |
|
For the six months
ended June 30, |
||||||||||||
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
EBITDA
|
|
$
|
187,590
|
|
|
$
|
285,754
|
|
|
$
|
399,646
|
|
|
$
|
451,470
|
|
|
Interest income and expense, net
|
|
(36,950
|
)
|
|
(42,281
|
)
|
|
(72,403
|
)
|
|
(89,397
|
)
|
||||
|
Depreciation and amortization
|
|
(155,410
|
)
|
|
(148,449
|
)
|
|
(309,631
|
)
|
|
(294,003
|
)
|
||||
|
Net income attributable to noncontrolling interests
|
|
632
|
|
|
462
|
|
|
1,438
|
|
|
842
|
|
||||
|
Income (loss) before income taxes
|
|
$
|
(4,138
|
)
|
|
$
|
95,486
|
|
|
$
|
19,050
|
|
|
$
|
68,912
|
|
|
|
|
For the six months ended June 30,
|
||||||
|
|
|
2019
|
|
2018
|
||||
|
|
|
|
|
|
||||
|
Employee benefits paid in Class A common stock
|
|
$
|
6,654
|
|
|
$
|
7,605
|
|
|
Increase (decrease) in capital expenditures included in accounts payable, net
|
|
$
|
(15,839
|
)
|
|
$
|
(8,467
|
)
|
|
|
|
For the three months
ended June 30, |
|
For the six months
ended June 30, |
||||||||||||
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Cost of sales
|
|
$
|
6,316
|
|
|
$
|
6,290
|
|
|
$
|
11,711
|
|
|
$
|
12,888
|
|
|
Research and development
|
|
$
|
6,388
|
|
|
$
|
6,647
|
|
|
$
|
13,276
|
|
|
$
|
13,784
|
|
|
•
|
Revenue of $537 million
|
|
•
|
Operating income of $23 million
|
|
•
|
Net loss of $5 million
|
|
•
|
Net loss attributable to EchoStar common stock of $6 million and basic loss per share of common stock of $0.06
|
|
•
|
Earnings before interest, taxes, depreciation and amortization (“EBITDA”) of $188 million (see reconciliation of this non-GAAP measure on page 53)
|
|
•
|
Total assets of $7.9 billion
|
|
•
|
Total liabilities of $3.7 billion
|
|
•
|
Total stockholders’ equity of $4.2 billion
|
|
•
|
Cash, cash equivalents and current marketable investment securities of $2.5 billion
|
|
|
|
As of
|
|||||||
|
|
|
June 30, 2019
|
|
March 31, 2019
|
|
December 31, 2018
|
|||
|
Broadband subscribers
|
|
1,415,000
|
|
|
1,388,000
|
|
|
1,361,000
|
|
|
|
|
For the three months ended
|
||||
|
|
|
June 30, 2019
|
|
March 31, 2019
|
||
|
Net additions
|
|
26,000
|
|
|
28,000
|
|
|
|
|
For the three months
ended June 30, |
|
Variance
|
|||||||||||
|
Statements of Operations Data (1)
|
|
2019
|
|
2018
|
|
Amount
|
|
%
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Services and other revenue - DISH Network
|
|
$
|
85,057
|
|
|
$
|
100,171
|
|
|
$
|
(15,114
|
)
|
|
(15.1
|
)
|
|
Services and other revenue - other
|
|
394,422
|
|
|
375,445
|
|
|
18,977
|
|
|
5.1
|
|
|||
|
Equipment revenue
|
|
57,645
|
|
|
50,341
|
|
|
7,304
|
|
|
14.5
|
|
|||
|
Total revenue
|
|
537,124
|
|
|
525,957
|
|
|
11,167
|
|
|
2.1
|
|
|||
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Cost of sales - services and other
|
|
153,198
|
|
|
151,157
|
|
|
2,041
|
|
|
1.4
|
|
|||
|
% of total services and other revenue
|
|
32.0
|
%
|
|
31.8
|
%
|
|
|
|
|
|
||||
|
Cost of sales - equipment
|
|
46,549
|
|
|
41,865
|
|
|
4,684
|
|
|
11.2
|
|
|||
|
% of total equipment revenue
|
|
80.8
|
%
|
|
83.2
|
%
|
|
|
|
|
|
||||
|
Selling, general and administrative expenses
|
|
152,629
|
|
|
103,074
|
|
|
49,555
|
|
|
48.1
|
|
|||
|
% of total revenue
|
|
28.4
|
%
|
|
19.6
|
%
|
|
|
|
|
|
||||
|
Research and development expenses
|
|
6,388
|
|
|
6,647
|
|
|
(259
|
)
|
|
(3.9
|
)
|
|||
|
% of total revenue
|
|
1.2
|
%
|
|
1.3
|
%
|
|
|
|
|
|
||||
|
Depreciation and amortization
|
|
155,410
|
|
|
148,449
|
|
|
6,961
|
|
|
4.7
|
|
|||
|
Total costs and expenses
|
|
514,174
|
|
|
451,192
|
|
|
62,982
|
|
|
14.0
|
|
|||
|
Operating income
|
|
22,950
|
|
|
74,765
|
|
|
(51,815
|
)
|
|
(69.3
|
)
|
|||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Interest income
|
|
23,213
|
|
|
19,253
|
|
|
3,960
|
|
|
20.6
|
|
|||
|
Interest expense, net of amounts capitalized
|
|
(60,163
|
)
|
|
(61,534
|
)
|
|
1,371
|
|
|
(2.2
|
)
|
|||
|
Gains (losses) on investments, net
|
|
12,856
|
|
|
65,396
|
|
|
(52,540
|
)
|
|
(80.3
|
)
|
|||
|
Equity in losses of unconsolidated affiliates, net
|
|
(4,754
|
)
|
|
(2,058
|
)
|
|
(2,696
|
)
|
|
*
|
|
|||
|
Other, net
|
|
1,760
|
|
|
(336
|
)
|
|
2,096
|
|
|
*
|
|
|||
|
Total other income (expense), net
|
|
(27,088
|
)
|
|
20,721
|
|
|
(47,809
|
)
|
|
*
|
|
|||
|
Income (loss) before income taxes
|
|
(4,138
|
)
|
|
95,486
|
|
|
(99,624
|
)
|
|
*
|
|
|||
|
Income tax provision, net
|
|
(922
|
)
|
|
(17,802
|
)
|
|
(16,880
|
)
|
|
94.8
|
|
|||
|
Net income (loss)
|
|
(5,060
|
)
|
|
77,684
|
|
|
(82,744
|
)
|
|
*
|
|
|||
|
Less: Net income attributable to noncontrolling interests
|
|
632
|
|
|
462
|
|
|
170
|
|
|
36.8
|
|
|||
|
Net income (loss) attributable to EchoStar Corporation common stock
|
|
$
|
(5,692
|
)
|
|
$
|
77,222
|
|
|
$
|
(82,914
|
)
|
|
*
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Other data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
EBITDA (2)
|
|
$
|
187,590
|
|
|
$
|
285,754
|
|
|
$
|
(98,164
|
)
|
|
(34.4
|
)
|
|
Subscribers, end of period
|
|
1,415,000
|
|
|
1,298,000
|
|
|
117,000
|
|
|
9.0
|
|
|||
|
(1)
|
An explanation of our key metrics is included on pages 65 and 66 under the heading Explanation of Key Metrics and Other Items.
|
|
(2)
|
A reconciliation of EBITDA to Net income, the most directly comparable generally accepted accounting principles (“U.S. GAAP”) measure in the accompanying financial statements, is included on page 53. For further information on our use of EBITDA, see Explanation of Key Metrics and Other Items on page 66.
|
|
|
|
Amounts
|
||
|
|
|
|
||
|
Net income attributable to EchoStar Corporation for the three months ended June 30, 2018
|
|
$
|
77,222
|
|
|
Decrease in operating income, including depreciation and amortization
|
|
(51,815
|
)
|
|
|
Decrease in gains on investments, net
|
|
(52,540
|
)
|
|
|
Increase in equity in losses of unconsolidated affiliates, net
|
|
(2,696
|
)
|
|
|
Increase in interest income
|
|
3,960
|
|
|
|
Decrease in interest expense, net of amounts capitalized
|
|
1,371
|
|
|
|
Increase in other income
|
|
2,096
|
|
|
|
Decrease in income tax provision, net
|
|
16,880
|
|
|
|
Increase in net income attributable to noncontrolling interests
|
|
(170
|
)
|
|
|
Net loss attributable to EchoStar Corporation for the three months ended June 30, 2019
|
|
$
|
(5,692
|
)
|
|
|
|
For the three months
ended June 30, |
|
Variance
|
|||||||||||
|
|
|
2019
|
|
2018
|
|
Amount
|
|
%
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Net income (loss)
|
|
$
|
(5,060
|
)
|
|
$
|
77,684
|
|
|
$
|
(82,744
|
)
|
|
*
|
|
|
Interest income and expense, net
|
|
36,950
|
|
|
42,281
|
|
|
(5,331
|
)
|
|
(12.6
|
)
|
|||
|
Income tax provision, net
|
|
922
|
|
|
17,802
|
|
|
(16,880
|
)
|
|
(94.8
|
)
|
|||
|
Depreciation and amortization
|
|
155,410
|
|
|
148,449
|
|
|
6,961
|
|
|
4.7
|
|
|||
|
Net income attributable to noncontrolling interests
|
|
(632
|
)
|
|
(462
|
)
|
|
(170
|
)
|
|
36.8
|
|
|||
|
EBITDA
|
|
$
|
187,590
|
|
|
$
|
285,754
|
|
|
$
|
(98,164
|
)
|
|
(34.4
|
)
|
|
|
|
Hughes
|
|
ESS
|
|
Corporate and Other
|
|
Consolidated
Total |
||||||||
|
For the three months ended June 30, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total revenue
|
|
$
|
451,847
|
|
|
$
|
80,961
|
|
|
$
|
4,316
|
|
|
$
|
537,124
|
|
|
Capital expenditures
|
|
$
|
74,090
|
|
|
$
|
136
|
|
|
$
|
33,252
|
|
|
$
|
107,478
|
|
|
EBITDA
|
|
$
|
131,765
|
|
|
$
|
68,174
|
|
|
$
|
(12,349
|
)
|
|
$
|
187,590
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
For the three months ended June 30, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total revenue
|
|
$
|
426,306
|
|
|
$
|
95,425
|
|
|
$
|
4,226
|
|
|
$
|
525,957
|
|
|
Capital expenditures
|
|
$
|
87,511
|
|
|
$
|
356
|
|
|
$
|
31,725
|
|
|
$
|
119,592
|
|
|
EBITDA
|
|
$
|
152,134
|
|
|
$
|
82,483
|
|
|
$
|
51,137
|
|
|
$
|
285,754
|
|
|
|
|
For the three months
ended June 30, |
|
Variance
|
|||||||||||
|
|
|
2019
|
|
2018
|
|
Amount
|
|
%
|
|||||||
|
Total revenue
|
|
$
|
451,847
|
|
|
$
|
426,306
|
|
|
$
|
25,541
|
|
|
6.0
|
|
|
Capital expenditures
|
|
$
|
74,090
|
|
|
$
|
87,511
|
|
|
$
|
(13,421
|
)
|
|
(15.3
|
)
|
|
EBITDA
|
|
$
|
131,765
|
|
|
$
|
152,134
|
|
|
$
|
(20,369
|
)
|
|
(13.4
|
)
|
|
|
|
For the three months
ended June 30, |
|
Variance
|
|||||||||||
|
|
|
2019
|
|
2018
|
|
Amount
|
|
%
|
|||||||
|
Total revenue
|
|
$
|
80,961
|
|
|
$
|
95,425
|
|
|
$
|
(14,464
|
)
|
|
(15.2
|
)
|
|
Capital expenditures
|
|
$
|
136
|
|
|
$
|
356
|
|
|
$
|
(220
|
)
|
|
(61.8
|
)
|
|
EBITDA
|
|
$
|
68,174
|
|
|
$
|
82,483
|
|
|
$
|
(14,309
|
)
|
|
(17.3
|
)
|
|
|
|
For the three months
ended June 30, |
|
Variance
|
||||||||||
|
|
|
2019
|
|
2018
|
|
Amount
|
|
%
|
||||||
|
Total revenue
|
|
$
|
4,316
|
|
|
$
|
4,226
|
|
|
$
|
90
|
|
|
2.1
|
|
Capital expenditures
|
|
$
|
33,252
|
|
|
$
|
31,725
|
|
|
$
|
1,527
|
|
|
4.8
|
|
EBITDA
|
|
$
|
(12,349
|
)
|
|
$
|
51,137
|
|
|
$
|
(63,486
|
)
|
|
*
|
|
|
|
For the six months
ended June 30, |
|
Variance
|
|||||||||||
|
Statements of Operations Data (1)
|
|
2019
|
|
2018
|
|
Amount
|
|
%
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Services and other revenue - DISH Network
|
|
$
|
170,945
|
|
|
$
|
203,976
|
|
|
$
|
(33,031
|
)
|
|
(16.2
|
)
|
|
Services and other revenue - other
|
|
787,902
|
|
|
730,485
|
|
|
57,417
|
|
|
7.9
|
|
|||
|
Equipment revenue
|
|
109,359
|
|
|
93,288
|
|
|
16,071
|
|
|
17.2
|
|
|||
|
Total revenue
|
|
1,068,206
|
|
|
1,027,749
|
|
|
40,457
|
|
|
3.9
|
|
|||
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Cost of sales - services and other
|
|
306,769
|
|
|
299,902
|
|
|
6,867
|
|
|
2.3
|
|
|||
|
% of total services and other revenue
|
|
32.0
|
%
|
|
32.1
|
%
|
|
|
|
|
|
|
|||
|
Cost of sales - equipment
|
|
91,556
|
|
|
80,936
|
|
|
10,620
|
|
|
13.1
|
|
|||
|
% of total equipment revenue
|
|
83.7
|
%
|
|
86.8
|
%
|
|
|
|
|
|
||||
|
Selling, general and administrative expenses
|
|
264,763
|
|
|
206,349
|
|
|
58,414
|
|
|
28.3
|
|
|||
|
% of total revenue
|
|
24.8
|
%
|
|
20.1
|
%
|
|
|
|
|
|
|
|||
|
Research and development expenses
|
|
13,276
|
|
|
13,784
|
|
|
(508
|
)
|
|
(3.7
|
)
|
|||
|
% of total revenue
|
|
1.2
|
%
|
|
1.3
|
%
|
|
|
|
|
|
|
|||
|
Depreciation and amortization
|
|
309,631
|
|
|
294,003
|
|
|
15,628
|
|
|
5.3
|
|
|||
|
Total costs and expenses
|
|
985,995
|
|
|
894,974
|
|
|
91,021
|
|
|
10.2
|
|
|||
|
Operating income
|
|
82,211
|
|
|
132,775
|
|
|
(50,564
|
)
|
|
(38.1
|
)
|
|||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Interest income
|
|
47,642
|
|
|
34,888
|
|
|
12,754
|
|
|
36.6
|
|
|||
|
Interest expense, net of amounts capitalized
|
|
(120,045
|
)
|
|
(124,285
|
)
|
|
4,240
|
|
|
3.4
|
|
|||
|
Gains (losses) on investments, net
|
|
19,791
|
|
|
28,733
|
|
|
(8,942
|
)
|
|
(31.1
|
)
|
|||
|
Equity in losses of unconsolidated affiliates, net
|
|
(11,107
|
)
|
|
(3,067
|
)
|
|
(8,040
|
)
|
|
*
|
|
|||
|
Other, net
|
|
558
|
|
|
(132
|
)
|
|
690
|
|
|
*
|
|
|||
|
Total other income (expense), net
|
|
(63,161
|
)
|
|
(63,863
|
)
|
|
702
|
|
|
(1.1
|
)
|
|||
|
Income before income taxes
|
|
19,050
|
|
|
68,912
|
|
|
(49,862
|
)
|
|
(72.4
|
)
|
|||
|
Income tax provision, net
|
|
(9,102
|
)
|
|
(12,399
|
)
|
|
(3,297
|
)
|
|
26.6
|
|
|||
|
Net income
|
|
9,948
|
|
|
56,513
|
|
|
(46,565
|
)
|
|
(82.4
|
)
|
|||
|
Less: Net income attributable to noncontrolling interests
|
|
1,438
|
|
|
842
|
|
|
596
|
|
|
70.8
|
|
|||
|
Net income attributable to EchoStar Corporation common stock
|
|
$
|
8,510
|
|
|
$
|
55,671
|
|
|
$
|
(47,161
|
)
|
|
(84.7
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||
|
Other data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
EBITDA (2)
|
|
$
|
399,646
|
|
|
$
|
451,470
|
|
|
$
|
(51,824
|
)
|
|
(11.5
|
)
|
|
Subscribers, end of period
|
|
1,415,000
|
|
|
1,298,000
|
|
|
117,000
|
|
|
9.0
|
|
|||
|
(1)
|
An explanation of our key metrics is included on pages 65 and 66 under the heading Explanation of Key Metrics and Other Items.
|
|
(2)
|
A reconciliation of EBITDA to Net income, the most directly comparable U.S. GAAP measure in the accompanying financial statements, is included on page 59. For further information on our use of EBITDA, see Explanation of Key Metrics and Other Items on page 66.
|
|
|
|
Amounts
|
||
|
|
|
|
||
|
Net income attributable to EchoStar Corporation for the six months ended June 30, 2018
|
|
$
|
55,671
|
|
|
Decrease in operating income, including depreciation and amortization
|
|
(50,564
|
)
|
|
|
Decrease in gains on investments, net
|
|
(8,942
|
)
|
|
|
Increase in equity in losses of unconsolidated affiliates, net
|
|
(8,040
|
)
|
|
|
Increase in interest income
|
|
12,754
|
|
|
|
Decrease in interest expense, net of amounts capitalized
|
|
4,240
|
|
|
|
Increase in other income
|
|
690
|
|
|
|
Decrease in income tax provision, net
|
|
3,297
|
|
|
|
Increase in net income attributable to noncontrolling interests
|
|
(596
|
)
|
|
|
Net income attributable to EchoStar Corporation for the six months ended June 30, 2019
|
|
$
|
8,510
|
|
|
|
|
For the six months
ended June 30, |
|
Variance
|
|||||||||||
|
|
|
2019
|
|
2018
|
|
Amount
|
|
%
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Net income
|
|
$
|
9,948
|
|
|
$
|
56,513
|
|
|
$
|
(46,565
|
)
|
|
(82.4
|
)
|
|
Interest income and expense, net
|
|
72,403
|
|
|
89,397
|
|
|
(16,994
|
)
|
|
(19.0
|
)
|
|||
|
Income tax provision, net
|
|
9,102
|
|
|
12,399
|
|
|
(3,297
|
)
|
|
(26.6
|
)
|
|||
|
Depreciation and amortization
|
|
309,631
|
|
|
294,003
|
|
|
15,628
|
|
|
5.3
|
|
|||
|
Net income attributable to noncontrolling interests
|
|
(1,438
|
)
|
|
(842
|
)
|
|
(596
|
)
|
|
70.8
|
|
|||
|
EBITDA
|
|
$
|
399,646
|
|
|
$
|
451,470
|
|
|
$
|
(51,824
|
)
|
|
(11.5
|
)
|
|
|
|
Hughes
|
|
ESS
|
|
Corporate and Other
|
|
Consolidated
Total |
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
For the six months ended June 30, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total revenue
|
|
$
|
897,184
|
|
|
$
|
162,220
|
|
|
$
|
8,802
|
|
|
$
|
1,068,206
|
|
|
Capital expenditures
|
|
$
|
147,911
|
|
|
$
|
244
|
|
|
$
|
71,285
|
|
|
$
|
219,440
|
|
|
EBITDA
|
|
$
|
292,897
|
|
|
$
|
136,891
|
|
|
$
|
(30,142
|
)
|
|
$
|
399,646
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
For the six months ended June 30, 2018
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total revenue
|
|
$
|
827,124
|
|
|
$
|
192,178
|
|
|
$
|
8,447
|
|
|
$
|
1,027,749
|
|
|
Capital expenditures
|
|
$
|
174,802
|
|
|
$
|
(76,682
|
)
|
|
$
|
72,454
|
|
|
$
|
170,574
|
|
|
EBITDA
|
|
$
|
288,847
|
|
|
$
|
166,633
|
|
|
$
|
(4,010
|
)
|
|
$
|
451,470
|
|
|
|
|
For the six months
ended June 30, |
|
Variance
|
|||||||||||
|
|
|
2019
|
|
2018
|
|
Amount
|
|
%
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Total revenue
|
|
$
|
897,184
|
|
|
$
|
827,124
|
|
|
$
|
70,060
|
|
|
8.5
|
|
|
Capital expenditures
|
|
$
|
147,911
|
|
|
$
|
174,802
|
|
|
$
|
(26,891
|
)
|
|
(15.4
|
)
|
|
EBITDA
|
|
$
|
292,897
|
|
|
$
|
288,847
|
|
|
$
|
4,050
|
|
|
1.4
|
|
|
|
|
For the six months
ended June 30, |
|
Variance
|
|||||||||||
|
|
|
2019
|
|
2018
|
|
Amount
|
|
%
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Total revenue
|
|
$
|
162,220
|
|
|
$
|
192,178
|
|
|
$
|
(29,958
|
)
|
|
(15.6
|
)
|
|
Capital expenditures
|
|
$
|
244
|
|
|
$
|
(76,682
|
)
|
|
$
|
76,926
|
|
|
*
|
|
|
EBITDA
|
|
$
|
136,891
|
|
|
$
|
166,633
|
|
|
$
|
(29,742
|
)
|
|
(17.8
|
)
|
|
|
|
For the six months
ended June 30, |
|
Variance
|
|||||||||||
|
|
|
2019
|
|
2018
|
|
Amount
|
|
%
|
|||||||
|
|
|
|
|
|
|
|
|
|
|||||||
|
Total revenue
|
|
$
|
8,802
|
|
|
$
|
8,447
|
|
|
$
|
355
|
|
|
4.2
|
|
|
Capital expenditures
|
|
$
|
71,285
|
|
|
$
|
72,454
|
|
|
$
|
(1,169
|
)
|
|
(1.6
|
)
|
|
EBITDA
|
|
$
|
(30,142
|
)
|
|
$
|
(4,010
|
)
|
|
$
|
(26,132
|
)
|
|
*
|
|
|
•
|
the required governmental consents having been received and the required governmental notices that are required to be submitted prior to the closing having been filed;
|
|
•
|
the absence of any governmental action or proceeding (a) challenging or seeking to make illegal or otherwise prohibit, directly or indirectly, the consummation of the BSS Transaction, or (b) directly involving us, BSS Corp., DISH or Merger Sub or any of our or their affiliates that would reasonably be expected to materially impair DISH or Merger Sub’s ability to own or operate the BSS Business and conduct the business as currently conducted;
|
|
•
|
the absence of any governmental order prohibiting the consummation of the BSS Transaction;
|
|
•
|
the absence of any laws or orders enjoining the consummation of the BSS Transaction;
|
|
•
|
the DISH registration statement having become effective under the Securities Act of 1933, as amended, and a prospectus or any other required SEC filings having been disseminated to our stockholders;
|
|
•
|
DISH Network having filed with the NASDAQ a notification form for the listing of all DISH Common Stock to be issued to BSS Corp. stockholders in the Merger, and NASDAQ not having objected to the listing of such DISH Common Stock;
|
|
•
|
certain consents with respect to the operation of the EchoStar XXIII satellite having been obtained; and
|
|
•
|
other customary conditions.
|
|
•
|
the inability to successfully integrate the BSS Business into DISH Network in a manner that permits DISH Network to achieve the full revenue and cost savings anticipated from the Transactions;
|
|
•
|
complexities associated with managing the larger, more complex, integrated business;
|
|
•
|
not realizing anticipated operating synergies;
|
|
•
|
integrating personnel from the BSS Business and the loss of key employees; and
|
|
•
|
potential unknown liabilities and unforeseen expenses, delays or regulatory conditions associated with the BSS Transaction.
|
|
Exhibit No.
|
|
Description
|
|
|
|
|
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
101.INS
|
|
XBRL Instance Document. The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema.
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase.
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase.
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase.
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase.
|
|
(H)
|
Filed herewith.
|
|
(I)
|
Furnished herewith
|
|
*
|
Incorporated by reference.
|
|
**
|
Constitutes a management contract or compensatory plan or arrangement.
|
|
|
|
ECHOSTAR CORPORATION
|
|
|
|
|
|
|
|
|
|
Date: August 8, 2019
|
By:
|
/s/ Michael T. Dugan
|
|
|
|
Michael T. Dugan
|
|
|
|
Chief Executive Officer, President and Director
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
|
|
|
Date: August 8, 2019
|
By:
|
/s/ David J. Rayner
|
|
|
|
David J. Rayner
|
|
|
|
Executive Vice President, Chief Financial Officer, Chief Operating Officer and Treasurer
|
|
|
|
(Principal Financial and Accounting Officer)
|
|
|
Page
|
|
|
ARTICLE I ECHOSTAR PRE-CLOSING RESTRUCTURING; TRANSFERRED ASSETS AND RETAINED ASSETS; PRE-CLOSING DISTRIBUTION OF NEWCO SHARES
|
2
|
|
|
Section 1.1 The EchoStar Pre-Closing Restructuring
|
2
|
|
|
Section 1.2 Implementation
|
2
|
|
|
Section 1.3 Transactions To Be Effected Prior to the Closing
|
2
|
|
|
Section 1.4 Transferred Assets; Retained Assets
|
3
|
|
|
Section 1.5 Assumed Liabilities; Excluded Liabilities
|
4
|
|
|
Section 1.6 Assumed and Excluded Liabilities
|
6
|
|
|
Section 1.7 Asset Reallocation or Adjustment
|
6
|
|
|
Section 1.8 Consents
|
7
|
|
|
Section 1.9 Distribution of Newco Shares to Existing EchoStar Stockholders
|
8
|
|
|
ARTICLE II THE MERGER
|
10
|
|
|
Section 2.1 Closing Date
|
10
|
|
|
Section 2.2 The Closing
|
10
|
|
|
Section 2.3 Effective Time
|
10
|
|
|
Section 2.4 Closing Deliverables
|
10
|
|
|
Section 2.5 Tax Consequences
|
11
|
|
|
ARTICLE III CERTIFICATE OF INCORPORATION AND BY-LAWS OF THE SURVIVING CORPORATION; DIRECTORS AND OFFICERS OF THE SURVIVING CORPORATION
|
11
|
|
|
Section 3.1 Certificate of Incorporation
|
11
|
|
|
Section 3.2 The By-laws
|
11
|
|
|
Section 3.3 Directors
|
11
|
|
|
Section 3.4 Officers
|
11
|
|
|
ARTICLE IV EFFECT OF THE MERGER ON CAPITAL STOCK
|
11
|
|
|
Section 4.1 Effect on Capital Stock of Newco
|
11
|
|
|
Section 4.2 Exchange of Certificates and Book Entry Shares
|
12
|
|
|
Section 4.3 Appraisal Rights
|
14
|
|
|
Section 4.4 Adjustments
|
14
|
|
|
ARTICLE V REPRESENTATIONS AND WARRANTIES
|
15
|
|
|
Section 5.1 Representations and Warranties of the EchoStar Parties
|
15
|
|
|
Section 5.2 Representations and Warranties of the DISH Parties
|
28
|
|
|
ARTICLE VI COVENANTS
|
32
|
|
|
Section 6.1 Access to Information
|
32
|
|
|
Section 6.2 Conduct of the BSS Business Pending the Closing
|
33
|
|
|
Section 6.3 Conduct of DISH Pending the Closing
|
36
|
|
|
Section 6.4 Third Party Consents; Government Actions and Authorizations
|
37
|
|
|
Section 6.5 Information Statement; Registration Statement
|
40
|
|
|
Section 6.6 Newco Stockholder Written Consent
|
42
|
|
|
Section 6.7 Stock Exchange Listing
|
42
|
|
|
Section 6.8 Further Assurances
|
42
|
|
|
Section 6.9 Confidentiality
|
43
|
|
|
Section 6.10 Preservation of Records
|
44
|
|
|
Section 6.11 Publicity
|
44
|
|
|
Section 6.12 Intercompany Arrangements; Payables and Receivables
|
44
|
|
|
Section 6.13 Books and Records
|
45
|
|
|
Section 6.14 Notice of Developments
|
45
|
|
|
Section 6.15 Completion of the Pre-Closing Restructuring and Distribution
|
45
|
|
|
Section 6.16 Transfer of Newco Common Stock
|
46
|
|
|
Section 6.17 Tax Matters
|
46
|
|
|
Section 6.18 EchoStar Credit Support Obligations
|
46
|
|
|
ARTICLE VII CONDITIONS TO CLOSING
|
46
|
|
|
Section 7.1 Mutual Conditions to Closing
|
46
|
|
|
Section 7.2 Conditions Precedent to Obligations of the DISH Parties
|
47
|
|
|
Section 7.3 Conditions Precedent to Obligations of the EchoStar Parties
|
48
|
|
|
ARTICLE VIII INDEMNIFICATION
|
49
|
|
|
Section 8.1 Indemnification Obligations of EchoStar
|
49
|
|
|
Section 8.2 Indemnification Obligations of DISH
|
50
|
|
|
Section 8.3 Limitations on Indemnity
|
50
|
|
|
Section 8.4 Method of Asserting Claims
|
50
|
|
|
Section 8.5 Exclusive Remedy; Survival
|
51
|
|
|
ARTICLE IX TERMINATION
|
52
|
|
|
Section 9.1 Termination of Agreement
|
52
|
|
|
Section 9.2 Procedure Upon Termination
|
52
|
|
|
Section 9.3 Effect of Termination
|
53
|
|
|
ARTICLE X MISCELLANEOUS
|
53
|
|
|
Section 10.1 Notices
|
53
|
|
|
Section 10.2 Amendment; Waiver
|
54
|
|
|
Section 10.3 Counterparts; Signatures
|
54
|
|
|
Section 10.4 Assignment and Binding Effect
|
54
|
|
|
Section 10.5 Entire Agreement
|
55
|
|
|
Section 10.6 Severability
|
55
|
|
|
Section 10.7 Headings
|
55
|
|
|
Section 10.8 No Third Party Beneficiaries
|
55
|
|
|
Section 10.9 Governing Law
|
55
|
|
|
Section 10.10 Expenses
|
55
|
|
|
Section 10.11 Dispute Resolution
|
56
|
|
|
Section 10.12 Limited Liability
|
58
|
|
|
ARTICLE XI DEFINITIONS
|
58
|
|
|
Section 11.1 Certain Definitions
|
58
|
|
|
Section 11.2 Terms Defined Elsewhere in this Agreement
|
71
|
|
|
Section 11.3 Other Definitional and Interpretive Matters
|
73
|
|
|
Term
|
Section
|
|
AAA
|
Section 10.11(c)(i)
|
|
Agent
|
Section 1.9(b)(i)
|
|
Aggregate Merger Consideration
|
Section 4.1(a)
|
|
Agreement
|
Preamble
|
|
Amended Professional Services Agreement
|
Section 6.8(c)
|
|
Anti-Corruption Laws
|
Section 5.1(i)(iii)
|
|
Applicable Date
|
Section 5.1(g)(i)
|
|
Assumed Liabilities
|
Section 1.5(a)
|
|
Book Entry DISH Shares
|
Section 4.2(a)
|
|
Book Entry Newco Shares
|
Section 4.1(a)
|
|
By-laws
|
Section 3.2
|
|
Certificate
|
Section 4.1(a)
|
|
Certificate of Merger
|
Section 2.3
|
|
Charter
|
Section 3.1
|
|
Closing
|
Section 2.1
|
|
Closing Date
|
Section 2.1
|
|
Confidential Information
|
Section 6.9(b)
|
|
Confidentiality Agreement
|
Section 6.9(a)
|
|
DGCL
|
Section 2.2
|
|
DISH
|
Preamble
|
|
DISH Common Stock
|
Recitals
|
|
DISH Disclosure Letter
|
Section 5.2
|
|
DISH Indemnified Persons
|
Section 8.1
|
|
DISH Reports
|
Section 5.2(g)
|
|
DISH Shares
|
Recitals
|
|
Term
|
Section
|
|
Dispute
|
Section 10.11(b)(i)
|
|
Dispute Notice
|
Section 10.11(b)(i)
|
|
Distribution
|
Section 1.9(b)(ii)
|
|
EchoStar
|
Preamble
|
|
EchoStar Common Stock
|
Section 1.9(b)(ii)
|
|
EchoStar Credit Support Obligations
|
Section 6.18
|
|
EchoStar Disclosure Letter
|
Section 5.1
|
|
EchoStar Indemnified Persons
|
Section 8.2
|
|
EchoStar Related Party
|
Section 5.1(r)
|
|
EchoStar Reports
|
Section 5.1(g)(i)
|
|
Effective Time
|
Section 2.3
|
|
Exchange Fund
|
Section 4.2(a)
|
|
Exchange Ratio
|
Section 4.1(a)
|
|
Excluded Liabilities
|
Section 1.5(b)
|
|
Excluded Shares
|
Section 4.1(a)
|
|
Indemnified Party
|
Section 8.4
|
|
Indemnifying Party
|
Section 8.4
|
|
Joint Information Statement/Prospectus
|
Section 6.5(a)
|
|
Leased Satellite Consents
|
Section 5.1(e)
|
|
Losses
|
Section 8.1
|
|
Merger
|
Recitals
|
|
Merger Sub
|
Preamble
|
|
Merger Sub Common Stock
|
Section 4.1(c)
|
|
Merger Sub Shares
|
Section 4.1(c)
|
|
NASDAQ
|
Section 4.2(d)
|
|
Newco
|
Preamble
|
|
Newco Common Stock
|
Recitals
|
|
Newco Shares
|
Recitals
|
|
Notice Period
|
Section 8.4
|
|
Party, Parties
|
Preamble
|
|
Patents
|
Section 11.1 (in Intellectual Property definition)
|
|
Per Share Merger Consideration
|
Section 4.1(a)
|
|
Pre-Closing Restructuring
|
Section 1.3
|
|
Record Holders
|
Section 1.9(b)(ii)
|
|
Relevant EchoStar Subsidiaries
|
Section 5.1(a)
|
|
Representative
|
Section 6.1(a)
|
|
Required Governmental Applications
|
Section 6.4(c)
|
|
Required Governmental Notices
|
Section 6.4(c)
|
|
Requisite Stockholder Approval
|
Section 5.1(b)
|
|
Response
|
Section 10.11(b)(i)
|
|
Retained Assets
|
Section 1.4(b)
|
|
Term
|
Section
|
|
S-4 Registration Statement
|
Section 6.5(a)
|
|
Sanctions
|
Section 5.1(i)(iv)
|
|
Senior Party Representatives
|
Section 10.11(b)(i)
|
|
Separated IP Assets
|
Section 5.1(k)(ii)
|
|
Separated IT Assets
|
Section 5.1(k)(vii)
|
|
Separated Registered IP Assets
|
Section 5.1(k)(i)
|
|
Surviving Corporation
|
Section 2.2
|
|
Takeover Statute
|
Section 5.1(t)
|
|
Termination Date
|
Section 9.1(b)
|
|
Third Party Claim
|
Section 8.1
|
|
Trade Secrets
|
Section 11.1 (in Intellectual Property definition)
|
|
Transferred Assets
|
Section 1.4(a)
|
|
Transferred Real Property Leases
|
Section 5.1(q)(i)
|
|
Transition Services Agreement(s)
|
Section 6.8(c)
|
|
TT&C Agreement(s)
|
Section 6.8(c)
|
|
|
DISH NETWORK CORPORATION
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ W. ERIK CARLSON
|
|
|
|
Name: W. Erik Carlson
|
|
|
|
Title: President and Chief Executive Officer
|
|
|
|
|
|
|
|
|
|
|
BSS MERGER SUB INC.
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ TIMOTHY A. MESSNER
|
|
|
|
Name: Timothy A. Messner
|
|
|
|
Title: Executive Vice President and General
Counsel |
|
|
|
|
|
|
|
|
|
|
ECHOSTAR CORPORATION
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ DEAN A. MANSON
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Executive Vice President, General
Counsel and Secretary |
|
|
|
|
|
|
|
|
|
|
ECHOSTAR BSS CORPORATION
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ DEAN A. MANSON
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: President, Secretary and Treasurer
|
|
|
|
|
|
|
|
|
|
ECHOSTAR BSS CORPORATION
|
|
100 Inverness Terrace East
|
|
Englewood, Colorado 80112
|
|
|
|
ECHOSTAR FSS L.L.C.
|
|
100 Inverness Terrace East
|
|
Englewood, Colorado 80112
|
|
|
|
|
|
|
2
|
|
|
|
ECHOSTAR BSS CORPORATION
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: President, Secretary and Treasurer
|
|
|
|
|
|
|
|
|
|
|
ECHOSTAR FSS L.L.C.
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Executive Vice President,
General Counsel and Secretary
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HUGHES SATELLITE SYSTEMS CORPORATION
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Executive Vice President, General Counsel & Secretary
|
|
|
|
|
|
|
ECHOSTAR 77 CORPORATION
ECHOSTAR SATELLITE SERVICES L.L.C. ECHOSTAR ORBITAL L.L.C. ECHOSTAR GOVERNMENT SERVICES L.L.C. ECHOSTAR SATELLITE OPERATING CORPORATION, HUGHES COMMUNICATIONS, INC., HUGHES NETWORK SYSTEMS, LLC, HUGHES NETWORK SYSTEMS INTERNATIONAL SERVICE COMPANY, HNS-INDIA VSAT, INC., HNS REAL ESTATE, LLC, HNS LICENSE SUB, LLC, ECHOSTAR XI HOLDING L.L.C., ECHOSTAR XIV HOLDING L.L.C., as Guarantors |
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Executive Vice President, General Counsel & Secretary
|
|
|
|
|
|
|
CHEYENNE DATA CENTER L.L.C., as a Guarantor
|
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Secretary
|
|
|
|
|
|
|
HNS AMERICAS, L.L.C., as a Guarantor
|
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Vice President, General Counsel & Secretary
|
|
|
|
|
|
|
HNS AMERICAS II, L.L.C., as a Guarantor
|
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Vice President, General Counsel & Secretary
|
|
|
|
|
|
|
ECHOSTAR BSS CORPORATION,
|
|
|
|
|
as a Supplemental Guarantor
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: President, Secretary and Treasurer
|
|
|
|
|
|
|
ECHOSTAR FSS L.L.C.,
|
|
|
|
|
as a Supplemental Guarantor
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Executive Vice President, General Counsel & Secretary
|
|
|
|
|
|
|
U.S. BANK NATIONAL ASSOCIATION,
as Trustee |
|
|
|
|
|
|
|
By:
|
/s/ Richard Prokosch
|
|
|
|
Name: Richard Prokosch
|
|
|
|
Title: Vice President
|
|
|
|
|
|
|
WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Collateral Agent |
|
|
|
|
|
|
|
By:
|
/s/ Alexander Pabon
|
|
|
|
Name: Alexander Pabon
|
|
|
|
Title: Assistant Vice President
|
|
|
|
|
|
|
|
|
|
|
HUGHES SATELLITE SYSTEMS CORPORATION
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Executive Vice President, General Counsel & Secretary
|
|
|
|
|
|
|
ECHOSTAR 77 CORPORATION
ECHOSTAR SATELLITE SERVICES L.L.C. ECHOSTAR ORBITAL L.L.C. ECHOSTAR GOVERNMENT SERVICES L.L.C. ECHOSTAR SATELLITE OPERATING CORPORATION, HUGHES COMMUNICATIONS, INC., HUGHES NETWORK SYSTEMS, LLC, HUGHES NETWORK SYSTEMS INTERNATIONAL SERVICE COMPANY, HNS-INDIA VSAT, INC., HNS REAL ESTATE, LLC, HNS LICENSE SUB, LLC, ECHOSTAR XI HOLDING L.L.C., ECHOSTAR XIV HOLDING L.L.C., as Guarantors |
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Executive Vice President, General Counsel & Secretary
|
|
|
|
|
|
|
CHEYENNE DATA CENTER L.L.C., as a Guarantor
|
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Secretary
|
|
|
|
|
|
|
HNS AMERICAS, L.L.C., as a Guarantor
|
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Vice President, General Counsel & Secretary
|
|
|
|
|
|
|
HNS AMERICAS II, L.L.C., as a Guarantor
|
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Vice President, General Counsel & Secretary
|
|
|
|
|
|
|
ECHOSTAR BSS CORPORATION,
|
|
|
|
|
as a Supplemental Guarantor
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: President, Secretary and Treasurer
|
|
|
|
|
|
|
ECHOSTAR FSS L.L.C.,
|
|
|
|
|
as a Supplemental Guarantor
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Executive Vice President, General Counsel & Secretary
|
|
|
U.S. BANK NATIONAL ASSOCIATION,
as Trustee |
|
|
|
|
|
|
|
By:
|
/s/ Richard Prokosch
|
|
|
|
Name: Richard Prokosch
|
|
|
|
Title: Vice President
|
|
|
|
|
|
|
HUGHES SATELLITE SYSTEMS CORPORATION
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Executive Vice President, General Counsel & Secretary
|
|
|
|
|
|
|
ECHOSTAR 77 CORPORATION
ECHOSTAR SATELLITE SERVICES L.L.C. ECHOSTAR ORBITAL L.L.C. ECHOSTAR GOVERNMENT SERVICES L.L.C. ECHOSTAR SATELLITE OPERATING CORPORATION, HUGHES COMMUNICATIONS, INC., HUGHES NETWORK SYSTEMS, LLC, HUGHES NETWORK SYSTEMS INTERNATIONAL SERVICE COMPANY, HNS-INDIA VSAT, INC., HNS REAL ESTATE, LLC, HNS LICENSE SUB, LLC, ECHOSTAR XI HOLDING L.L.C., ECHOSTAR XIV HOLDING L.L.C., as Guarantors |
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Executive Vice President, General Counsel & Secretary
|
|
|
|
|
|
|
CHEYENNE DATA CENTER L.L.C., as a Guarantor
|
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Secretary
|
|
|
|
|
|
|
HNS AMERICAS, L.L.C., as a Guarantor
|
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Vice President, General Counsel & Secretary
|
|
|
|
|
|
|
HNS AMERICAS II, L.L.C., as a Guarantor
|
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Vice President, General Counsel & Secretary
|
|
|
|
|
|
|
ECHOSTAR BSS CORPORATION,
|
|
|
|
|
as a Supplemental Guarantor
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: President, Secretary and Treasurer
|
|
|
|
|
|
|
ECHOSTAR FSS L.L.C.,
|
|
|
|
|
as a Supplemental Guarantor
|
|
|
|
|
|
|
By:
|
/s/ Dean A. Manson
|
|
|
|
Name: Dean A. Manson
|
|
|
|
Title: Executive Vice President, General Counsel & Secretary
|
|
|
|
|
|
|
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee
|
|
|
|
|
|
|
|
By:
|
/s/ Alexander Pabon
|
|
|
|
Name: Alexander Pabon
|
|
|
|
Title: Assistant Vice President
|
|
|
|
|
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of EchoStar Corporation;
|
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
Date: August 8, 2019
|
|
|
|
|
|
|
|
By:
|
/s/ Michael T. Dugan
|
|
|
Name:
|
Michael T. Dugan
|
|
|
Title:
|
Chief Executive Officer, President and Director
|
|
|
|
(Principal Executive Officer)
|
|
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
Date: August 8, 2019
|
|
|
|
|
|
|
|
By:
|
/s/ David J. Rayner
|
|
|
Name:
|
David J. Rayner
|
|
|
Title:
|
Executive Vice President, Chief Financial Officer, Chief Operating Officer and Treasurer
|
|
|
|
(Principal Financial and Accounting Officer)
|
|
|
(i)
|
the Quarterly Report fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934; and
|
|
(ii)
|
the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
Date: August 8, 2019
|
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Michael T. Dugan
|
|
|
Name:
|
Michael T. Dugan
|
|
|
Title:
|
Chief Executive Officer, President and Director
|
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ David J. Rayner
|
|
|
Name:
|
David J. Rayner
|
|
|
Title:
|
Executive Vice President, Chief Financial Officer, Chief Operating Officer and Treasurer
|
|
|
|
(Principal Financial and Accounting Officer)
|
|
|
•
|
Consolidated revenues of $537 million.
|
|
•
|
Consolidated net loss of $5 million, consolidated net loss attributable to EchoStar common stock of $6 million, and diluted loss per share of $0.06.
|
|
•
|
Consolidated Adjusted EBITDA of $199 million (see discussion and the reconciliation of GAAP to this non-GAAP measure below).
|
|
•
|
Consolidated revenues of $1,068 million.
|
|
•
|
Consolidated net income of $10 million, consolidated net income attributable to EchoStar common stock of $9 million, and diluted earnings per share of $0.09.
|
|
•
|
Consolidated Adjusted EBITDA of $404 million (see discussion and the reconciliation of GAAP to this non-GAAP measure below).
|
|
•
|
Approximately 1,415,000 total Hughes broadband subscribers as of June 30, 2019 including approximately 169,000 subscribers in Central and South America.
|
|
•
|
Cash, cash equivalents and current marketable investment securities of $2.5 billion as of June 30, 2019.
|
|
|
|
For the three months
ended June 30, |
|
For the six months
ended June 30, |
||||||||||||
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Revenue
|
|
|
|
|
|
|
|
|
||||||||
|
Hughes
|
|
$
|
451,847
|
|
|
$
|
426,306
|
|
|
$
|
897,184
|
|
|
$
|
827,124
|
|
|
EchoStar Satellite Services
|
|
80,961
|
|
|
95,425
|
|
|
162,220
|
|
|
192,178
|
|
||||
|
Corporate & Other
|
|
4,316
|
|
|
4,226
|
|
|
8,802
|
|
|
8,447
|
|
||||
|
Total
|
|
$
|
537,124
|
|
|
$
|
525,957
|
|
|
$
|
1,068,206
|
|
|
$
|
1,027,749
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Adjusted EBITDA
|
|
|
|
|
|
|
|
|
||||||||
|
Hughes
|
|
$
|
156,298
|
|
|
$
|
151,628
|
|
|
$
|
318,161
|
|
|
$
|
288,737
|
|
|
EchoStar Satellite Services
|
|
68,174
|
|
|
82,483
|
|
|
136,891
|
|
|
166,633
|
|
||||
|
Corporate & Other:
|
|
|
|
|
|
|
|
|
||||||||
|
Corporate overhead, operating and other
|
|
(22,336
|
)
|
|
(21,266
|
)
|
|
(42,968
|
)
|
|
(39,137
|
)
|
||||
|
Equity in earnings (losses) of unconsolidated affiliates, net
|
|
(2,898
|
)
|
|
(2,058
|
)
|
|
(7,725
|
)
|
|
(3,067
|
)
|
||||
|
Sub-total
|
|
(25,234
|
)
|
|
(23,324
|
)
|
|
(50,693
|
)
|
|
(42,204
|
)
|
||||
|
Total
|
|
$
|
199,238
|
|
|
$
|
210,787
|
|
|
$
|
404,359
|
|
|
$
|
413,166
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Net income (loss)
|
|
$
|
(5,060
|
)
|
|
$
|
77,684
|
|
|
$
|
9,948
|
|
|
$
|
56,513
|
|
|
Expenditures for property and equipment
|
|
$
|
107,478
|
|
|
$
|
119,592
|
|
|
$
|
219,440
|
|
|
$
|
170,574
|
|
|
|
|
For the three months
ended June 30, |
|
For the six months
ended June 30, |
||||||||||||
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Net income (loss)
|
|
$
|
(5,060
|
)
|
|
$
|
77,684
|
|
|
$
|
9,948
|
|
|
$
|
56,513
|
|
|
Interest income and expense, net
|
|
36,950
|
|
|
42,281
|
|
|
72,403
|
|
|
89,397
|
|
||||
|
Income tax provision, net
|
|
922
|
|
|
17,802
|
|
|
9,102
|
|
|
12,399
|
|
||||
|
Depreciation and amortization
|
|
155,410
|
|
|
148,449
|
|
|
309,631
|
|
|
294,003
|
|
||||
|
Net income attributable to noncontrolling interests
|
|
(632
|
)
|
|
(462
|
)
|
|
(1,438
|
)
|
|
(842
|
)
|
||||
|
EBITDA
|
|
187,590
|
|
|
285,754
|
|
|
399,646
|
|
|
451,470
|
|
||||
|
(Gains) losses on investments, net
|
|
(12,856
|
)
|
|
(65,396
|
)
|
|
(19,791
|
)
|
|
(28,733
|
)
|
||||
|
Litigation expense
|
|
24,504
|
|
|
—
|
|
|
24,504
|
|
|
—
|
|
||||
|
Vendor settlement
|
|
—
|
|
|
(9,571
|
)
|
|
—
|
|
|
(9,571
|
)
|
||||
|
Adjusted EBITDA
|
|
$
|
199,238
|
|
|
$
|
210,787
|
|
|
$
|
404,359
|
|
|
$
|
413,166
|
|
|
EchoStar Investor Relations
|
EchoStar Media Relations
|
|
Deepak V. Dutt
Phone: +1 301-428-1686
Email: deepak.dutt@echostar.com
|
Sharyn Nerenberg
Phone: +1 301-428-7124
Email: sharyn.nerenberg@echostar.com
|
|
|
|
As of
|
||||||
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
|
Assets
|
|
(Unaudited)
|
|
(Audited)
|
||||
|
Current assets:
|
|
|
|
|
|
|
||
|
Cash and cash equivalents
|
|
$
|
1,298,005
|
|
|
$
|
928,306
|
|
|
Marketable investment securities, at fair value
|
|
1,203,308
|
|
|
2,282,152
|
|
||
|
Trade accounts receivable and contract assets, net (Note 3)
|
|
201,561
|
|
|
201,096
|
|
||
|
Trade accounts receivable - DISH Network
|
|
13,943
|
|
|
14,200
|
|
||
|
Inventory
|
|
73,345
|
|
|
75,379
|
|
||
|
Prepaids and deposits
|
|
65,589
|
|
|
61,177
|
|
||
|
Other current assets
|
|
19,857
|
|
|
18,539
|
|
||
|
Total current assets
|
|
2,875,608
|
|
|
3,580,849
|
|
||
|
Noncurrent assets:
|
|
|
|
|
|
|
||
|
Property and equipment, net
|
|
3,329,794
|
|
|
3,414,908
|
|
||
|
Operating lease right-of-use assets
|
|
113,643
|
|
|
—
|
|
||
|
Goodwill
|
|
504,173
|
|
|
504,173
|
|
||
|
Regulatory authorizations, net
|
|
493,661
|
|
|
495,654
|
|
||
|
Other intangible assets, net
|
|
36,869
|
|
|
44,231
|
|
||
|
Investments in unconsolidated entities
|
|
225,582
|
|
|
262,473
|
|
||
|
Other receivables - DISH Network
|
|
96,733
|
|
|
95,114
|
|
||
|
Other noncurrent assets, net
|
|
274,028
|
|
|
263,892
|
|
||
|
Total noncurrent assets
|
|
5,074,483
|
|
|
5,080,445
|
|
||
|
Total assets
|
|
$
|
7,950,091
|
|
|
$
|
8,661,294
|
|
|
Liabilities and Stockholders’ Equity
|
|
|
|
|
|
|
||
|
Current liabilities:
|
|
|
|
|
|
|
||
|
Trade accounts payable
|
|
$
|
105,929
|
|
|
$
|
121,437
|
|
|
Trade accounts payable - DISH Network
|
|
1,113
|
|
|
1,698
|
|
||
|
Current portion of long-term debt and finance lease obligations
|
|
42,682
|
|
|
959,577
|
|
||
|
Contract liabilities
|
|
106,308
|
|
|
72,284
|
|
||
|
Accrued interest
|
|
42,835
|
|
|
47,416
|
|
||
|
Accrued compensation
|
|
44,829
|
|
|
54,242
|
|
||
|
Accrued taxes
|
|
16,221
|
|
|
16,013
|
|
||
|
Accrued expenses and other
|
|
111,745
|
|
|
72,470
|
|
||
|
Total current liabilities
|
|
471,662
|
|
|
1,345,137
|
|
||
|
Noncurrent liabilities:
|
|
|
|
|
|
|
||
|
Long-term debt and finance lease obligations, net
|
|
2,553,352
|
|
|
2,573,204
|
|
||
|
Deferred tax liabilities, net
|
|
472,872
|
|
|
465,933
|
|
||
|
Operating lease liabilities
|
|
94,979
|
|
|
—
|
|
||
|
Other noncurrent liabilities
|
|
114,275
|
|
|
121,546
|
|
||
|
Total noncurrent liabilities
|
|
3,235,478
|
|
|
3,160,683
|
|
||
|
Total liabilities
|
|
3,707,140
|
|
|
4,505,820
|
|
||
|
Commitments and contingencies (Note 15)
|
|
|
|
|
||||
|
Stockholders’ equity:
|
|
|
|
|
|
|
||
|
Preferred stock, $0.001 par value, 20,000,000 shares authorized, none issued and outstanding at each of June 30, 2019 and December 31, 2018
|
|
—
|
|
|
—
|
|
||
|
Common stock, $0.001 par value, 4,000,000,000 shares authorized:
|
|
|
|
|
|
|
||
|
Class A common stock, $0.001 par value, 1,600,000,000 shares authorized, 56,189,672 shares issued and 49,704,751 shares outstanding at June 30, 2019 and 54,142,566 shares issued and 47,657,645 shares outstanding at December 31, 2018
|
|
56
|
|
|
54
|
|
||
|
Class B convertible common stock, $0.001 par value, 800,000,000 shares authorized, 47,687,039 shares issued and outstanding at each of June 30, 2019 and December 31, 2018
|
|
48
|
|
|
48
|
|
||
|
Class C convertible common stock, $0.001 par value, 800,000,000 shares authorized, none issued and outstanding at each of June 30, 2019 and December 31, 2018
|
|
—
|
|
|
—
|
|
||
|
Class D common stock, $0.001 par value, 800,000,000 shares authorized, none issued and outstanding at each of June 30, 2019 and December 31, 2018
|
|
—
|
|
|
—
|
|
||
|
Additional paid-in capital
|
|
3,777,499
|
|
|
3,702,522
|
|
||
|
Accumulated other comprehensive loss
|
|
(119,500
|
)
|
|
(125,100
|
)
|
||
|
Accumulated earnings
|
|
704,236
|
|
|
694,129
|
|
||
|
Treasury stock, at cost
|
|
(131,454
|
)
|
|
(131,454
|
)
|
||
|
Total EchoStar Corporation stockholders’ equity
|
|
4,230,885
|
|
|
4,140,199
|
|
||
|
Noncontrolling interests
|
|
12,066
|
|
|
15,275
|
|
||
|
Total stockholders’ equity
|
|
4,242,951
|
|
|
4,155,474
|
|
||
|
Total liabilities and stockholders’ equity
|
|
$
|
7,950,091
|
|
|
$
|
8,661,294
|
|
|
|
|
For the three months
ended June 30, |
|
For the six months
ended June 30, |
||||||||||||
|
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Services and other revenue - DISH Network
|
|
$
|
85,057
|
|
|
$
|
100,171
|
|
|
$
|
170,945
|
|
|
$
|
203,976
|
|
|
Services and other revenue - other
|
|
394,422
|
|
|
375,445
|
|
|
787,902
|
|
|
730,485
|
|
||||
|
Equipment revenue
|
|
57,645
|
|
|
50,341
|
|
|
109,359
|
|
|
93,288
|
|
||||
|
Total revenue
|
|
537,124
|
|
|
525,957
|
|
|
1,068,206
|
|
|
1,027,749
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Costs and expenses:
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Cost of sales - services and other (exclusive of depreciation and amortization)
|
|
153,198
|
|
|
151,157
|
|
|
306,769
|
|
|
299,902
|
|
||||
|
Cost of sales - equipment (exclusive of depreciation and amortization)
|
|
46,549
|
|
|
41,865
|
|
|
91,556
|
|
|
80,936
|
|
||||
|
Selling, general and administrative expenses
|
|
152,629
|
|
|
103,074
|
|
|
264,763
|
|
|
206,349
|
|
||||
|
Research and development expenses
|
|
6,388
|
|
|
6,647
|
|
|
13,276
|
|
|
13,784
|
|
||||
|
Depreciation and amortization
|
|
155,410
|
|
|
148,449
|
|
|
309,631
|
|
|
294,003
|
|
||||
|
Total costs and expenses
|
|
514,174
|
|
|
451,192
|
|
|
985,995
|
|
|
894,974
|
|
||||
|
Operating income
|
|
22,950
|
|
|
74,765
|
|
|
82,211
|
|
|
132,775
|
|
||||
|
|
|
|
|
|
|
|
|
|
||||||||
|
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Interest income
|
|
23,213
|
|
|
19,253
|
|
|
47,642
|
|
|
34,888
|
|
||||
|
Interest expense, net of amounts capitalized
|
|
(60,163
|
)
|
|
(61,534
|
)
|
|
(120,045
|
)
|
|
(124,285
|
)
|
||||
|
Gains (losses) on investments, net
|
|
12,856
|
|
|
65,396
|
|
|
19,791
|
|
|
28,733
|
|
||||
|
Equity in losses of unconsolidated affiliates, net
|
|
(4,754
|
)
|
|
(2,058
|
)
|
|
(11,107
|
)
|
|
(3,067
|
)
|
||||
|
Other, net
|
|
1,760
|
|
|
(336
|
)
|
|
558
|
|
|
(132
|
)
|
||||
|
Total other income (expense), net
|
|
(27,088
|
)
|
|
20,721
|
|
|
(63,161
|
)
|
|
(63,863
|
)
|
||||
|
Income (loss) before income taxes
|
|
(4,138
|
)
|
|
95,486
|
|
|
19,050
|
|
|
68,912
|
|
||||
|
Income tax provision, net
|
|
(922
|
)
|
|
(17,802
|
)
|
|
(9,102
|
)
|
|
(12,399
|
)
|
||||
|
Net income (loss)
|
|
(5,060
|
)
|
|
77,684
|
|
|
9,948
|
|
|
56,513
|
|
||||
|
Less: Net income attributable to noncontrolling interests
|
|
632
|
|
|
462
|
|
|
1,438
|
|
|
842
|
|
||||
|
Net income (loss) attributable to EchoStar Corporation common stock
|
|
$
|
(5,692
|
)
|
|
$
|
77,222
|
|
|
$
|
8,510
|
|
|
$
|
55,671
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Earnings per share - Class A and B common stock:
|
|
|
|
|
|
|
|
|
|
|
||||||
|
Basic earnings (loss) per share
|
|
$
|
(0.06
|
)
|
|
$
|
0.80
|
|
|
$
|
0.09
|
|
|
$
|
0.58
|
|
|
Diluted earnings (loss) per share
|
|
$
|
(0.06
|
)
|
|
$
|
0.80
|
|
|
$
|
0.09
|
|
|
$
|
0.57
|
|
|
|
|
For the six months ended June 30,
|
||||||
|
|
|
2019
|
|
2018
|
||||
|
Cash flows from operating activities:
|
|
|
|
|
|
|
||
|
Net income (loss)
|
|
$
|
9,948
|
|
|
$
|
56,513
|
|
|
Adjustments to reconcile net income to net cash flows from operating activities:
|
|
|
|
|
|
|
||
|
Depreciation and amortization
|
|
309,631
|
|
|
294,003
|
|
||
|
Equity in losses of unconsolidated affiliates, net
|
|
11,107
|
|
|
3,067
|
|
||
|
Amortization of debt issuance costs
|
|
3,872
|
|
|
3,905
|
|
||
|
(Gains) losses on investments, net
|
|
(19,791
|
)
|
|
(28,674
|
)
|
||
|
Stock-based compensation
|
|
4,833
|
|
|
5,110
|
|
||
|
Deferred tax provision
|
|
7,014
|
|
|
10,231
|
|
||
|
Dividend received from unconsolidated entity
|
|
—
|
|
|
5,000
|
|
||
|
Changes in current assets and current liabilities, net:
|
|
|
|
|
||||
|
Trade accounts receivable, net
|
|
167
|
|
|
(3,061
|
)
|
||
|
Trade accounts receivable - DISH Network
|
|
257
|
|
|
17,262
|
|
||
|
Inventory
|
|
2,114
|
|
|
238
|
|
||
|
Other current assets
|
|
(2,500
|
)
|
|
(5,430
|
)
|
||
|
Trade accounts payable
|
|
(225
|
)
|
|
2,364
|
|
||
|
Trade accounts payable - DISH Network
|
|
(585
|
)
|
|
(3,360
|
)
|
||
|
Accrued expenses and other
|
|
51,409
|
|
|
7,749
|
|
||
|
Changes in noncurrent assets and noncurrent liabilities, net
|
|
1,374
|
|
|
(17,200
|
)
|
||
|
Other, net
|
|
2,149
|
|
|
5,822
|
|
||
|
Net cash flows from operating activities
|
|
380,774
|
|
|
353,539
|
|
||
|
Cash flows from investing activities:
|
|
|
|
|
|
|
||
|
Purchases of marketable investment securities
|
|
(504,264
|
)
|
|
(1,632,930
|
)
|
||
|
Sales and maturities of marketable investment securities
|
|
1,621,481
|
|
|
841,638
|
|
||
|
Expenditures for property and equipment
|
|
(219,440
|
)
|
|
(248,098
|
)
|
||
|
Refunds and other receipts related to property and equipment
|
|
—
|
|
|
77,524
|
|
||
|
Expenditures for externally marketed software
|
|
(15,329
|
)
|
|
(15,000
|
)
|
||
|
Net cash flows from investing activities
|
|
882,448
|
|
|
(976,866
|
)
|
||
|
Cash flows from financing activities:
|
|
|
|
|
|
|
||
|
Repayment of debt and finance lease obligations
|
|
(21,180
|
)
|
|
(18,417
|
)
|
||
|
Repurchase and maturity of debt
|
|
(920,923
|
)
|
|
—
|
|
||
|
Purchase of noncontrolling interest
|
|
(7,313
|
)
|
|
—
|
|
||
|
Repayment of in-orbit incentive obligations
|
|
(3,778
|
)
|
|
(3,272
|
)
|
||
|
Net proceeds from Class A common stock options exercised
|
|
61,503
|
|
|
4,064
|
|
||
|
Net proceeds from Class A common stock issued under the Employee Stock Purchase Plan
|
|
5,074
|
|
|
4,886
|
|
||
|
Other, net
|
|
905
|
|
|
(401
|
)
|
||
|
Net cash flows from financing activities
|
|
(885,712
|
)
|
|
(13,140
|
)
|
||
|
Effect of exchange rates on cash and cash equivalents
|
|
121
|
|
|
(1,941
|
)
|
||
|
Net increase (decrease) in cash and cash equivalents, including restricted amounts
|
|
377,631
|
|
|
(638,408
|
)
|
||
|
Cash and cash equivalents, including restricted amounts, beginning of period
|
|
929,495
|
|
|
2,432,249
|
|
||
|
Cash and cash equivalents, including restricted amounts, end of period
|
|
$
|
1,307,126
|
|
|
$
|
1,793,841
|
|
|
|
|
|
|
|
||||
|
Supplemental disclosure of cash flow information:
|
|
|
|
|
|
|
||
|
Cash paid for interest, net of amounts capitalized
|
|
$
|
120,625
|
|
|
$
|
122,017
|
|
|
Cash paid for income taxes
|
|
$
|
1,217
|
|
|
$
|
2,574
|
|