echostar8_k.htm
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
Form
8-K
CURRENT
REPORT
Pursuant
to Section 13 OR 15(d) of the Securities Exchange Act of 1934
Date of
Report (Date of earliest event reported): December 21, 2009
ECHOSTAR
CORPORATION
(Exact
name of registrant as specified in its charter)
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NEVADA
(State
or other jurisdiction of
incorporation)
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001-33807
(Commission
File Number)
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26-1232727
(IRS
Employer
Identification
No.)
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100
INVERNESS TERRACE E.
ENGLEWOOD,
COLORADO
(Address
of principal executive offices)
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80112
(Zip
Code)
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(303) 706-4000
(Registrant’s
telephone number, including area code)
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR 240.14d-2(b))
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR 240.13e-4(c))
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Item 1.01. Entry into a Material
Definitive Agreement.
Satellite Capacity Agreements.
In connection with the distribution of DISH Network Corporation’s
(“DISH”) technology and set-top box business and certain infrastructure assets
(the “Spin-off”) to us, which was completed on January 1, 2008, we and DISH
entered into satellite capacity agreements pursuant to which DISH leases
satellite capacity on certain satellites owned or leased by us. The fees
for the services provided under these satellite capacity agreements depend,
among other things, upon the orbital location of the applicable satellite and
the frequency on which the applicable satellite provides services.
Generally, each satellite capacity agreement terminates upon the earlier
of: (i) the end-of-life or replacement of the applicable satellite; (ii)
the date the applicable satellite fails; (iii) the date the transponder(s)
on which service is being provided under the applicable agreement fails; or (iv)
January 1, 2010. As previously disclosed, we expected to enter into
agreements pursuant to which DISH would continue to lease satellite capacity on
certain satellites owned or leased by us after January 1,
2010.
On
December 21, 2009, we agreed with DISH to continue to lease to DISH satellite
capacity on EchoStar III, EchoStar VI, EchoStar VIII, and EchoStar XII after
January 1, 2010 and to lease to DISH satellite capacity on EchoStar XVI after
its service commencement date. Additionally, we agreed to lease from
DISH satellite capacity on EchoStar I after January 1, 2010.
Generally,
the satellite capacity agreements for EchoStar VI and EchoStar XII will
terminate upon the earlier of: (i) the end-of-life or replacement of the
applicable satellite; (ii) the date the applicable satellite fails;
(iii) the date the transponder(s) on which service is being provided under
the applicable agreement fails; or (iv) the date on which a certain portion of
the estimated useful life of the applicable satellite is reached, unless DISH
exercises its option to renew on a year-to-year basis through the end-of-life of
that satellite.
Generally,
the satellite capacity agreements for EchoStar I, III and VIII will terminate
upon the earlier of: (i) the end-of-life or replacement of the applicable
satellite, unless, upon replacement of the applicable satellite, we or DISH, as
applicable, exercise our option to renew on a year-to-year basis through the
end-of-life of that satellite; (ii) the date the applicable satellite fails; or
(iii) the date the transponder(s) on which service is being provided under the
applicable agreement fails. Furthermore, if the expected replacement
satellite for EchoStar I, EchoStar III or EchoStar VIII fails at launch or in
orbit prior to being placed in service, we or DISH, as applicable, have an
option to renew the applicable satellite capacity agreement through the date on
which a certain portion of the estimated useful life of the applicable satellite
is reached followed by a subsequent option to renew on a year-to-year basis
through the end-of-life of the applicable satellite.
Generally,
the satellite capacity agreement for EchoStar XVI will terminate upon the
earlier of: (i) the end-of-life or replacement of the satellite; (ii) the date
the satellite fails; (iii) the date the transponder(s) on which service is
being provided under the agreement fails; or (iv) ten years following the actual
service commencement date. Upon expiration of the initial term, DISH
has the option to renew on a year-to-year basis through the end-of-life of the
satellite.
EchoStar XV Launch
Service. As
previously disclosed, DISH estimated that the cost of a launch service for its
EchoStar XV satellite could range from approximately $90 million to
$120 million. On December 21, 2009, we assigned our rights under
one of our launch service contracts to DISH at a cost within that range. DISH
expects to use this launch service for EchoStar XV, which is scheduled to launch
in late 2010.
On
February 13, 2009, Multimedia Patent Trust (“MPT”) filed suit against us,
DISH, DirecTV and several other defendants in the United States District Court
for the Southern District of California alleging infringement of United States
Patent Nos. 4,958,226, 5,227,878, 5,136,377, 5,500,678 and 5,563,593, which
relate to video encoding, decoding and compression technology. MPT is an entity
that seeks to license an acquired patent portfolio without itself practicing any
of the claims recited therein.
In
December 2009, we and DISH reached a settlement with MPT that did not have
a material impact on our results of operations. DISH has
determined that it is obligated under the agreements entered into in connection
with the Spin-off to indemnify us for all of the settlement relating to the
period prior to the Spin-off and a portion of the settlement relating to the
period after the Spin-off. We have agreed that our contribution
towards the settlement shall not be applied against our aggregate liability cap
under that certain Receiver Agreement entered into in connection with the
Spin-off dated December 31, 2007 between EchoSphere L.L.C., a subsidiary of
DISH, and EchoStar Technologies L.L.C., a subsidiary of us.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
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ECHOSTAR
CORPORATION
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Date:
December 28, 2009
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By:
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/s/ R. Stanton Dodge
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R.
Stanton Dodge
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Executive
Vice President, General Counsel and Secretary
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