EchoStar DISH DBS Restructuring

Another step towards repositioning as a Space Investment pure-play

Brief note to discuss the DISH DBS Restructuring which got announced last night as have received a few questions on it.

The RSA and associated Term Sheet can be found here:

https://ir.echostar.com/static-files/7d22aa28-8f85-4694-b303-4547598dd8e1

As a reminder before we get into the details, the key drivers of our EchoStar valuation can be ranked in the following order:

1. SpaceX valuation

2. AT&T spectrum sale

3. Value of remaining spectrum

4. Ability to mitigate tax liabilities and lease termination costs

5. Legacy OpCo business (PayTV, Hughes, Retail Wireless)

This RSA (almost) exclusively concerns the legacy PayTV business.

TLDR: impact is neutral and has little bearing on our overall valuation.

It is mainly relevant in so far as it involves Parent support to a non-recourse segment and so for EchoStar to pursue this management must have visibility on a sale to DirectTV.

While it makes little difference on a numbers basis, the clean-up could facilitate a transition towards a “Space Investment HoldCo” as the Company repositions itself with a new shareholder base.