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DISH Network to make $1 billion cash tender offer for DBSD claims
By Caroline Salls
Pittsburgh, Feb. 25 - DBSD North America, Inc. has entered into an amendment to an investment agreement under which DISH Network Corp. originally committed to acquire 100% of the equity of reorganized DBSD for $1 billion, according to an 8-K filed Friday with the Securities and Exchange Commission.
Under the amended agreement, DISH Network will make a cash tender offer to purchase claims against DBSD North America and its affiliates for up to $1 billion.
According to the 8-K, the closing of the tender offer is not subject to approval of the Federal Communications Commission but is subject to bankruptcy court approval.
DISH Network said the $1 billion would be paid after the tender offer is accepted.
DISH Network said it is still committed to support DBSD North America's plan of reorganization, under which it will acquire 100% of the reorganized company's equity. The equity purchase is subject to FCC approval and DBSD's emergence from bankruptcy.
In addition, DISH Network has proposed a revised credit facility to provide DBSD North America with an $87.5 million non-revolving, multiple-draw term loan.
Under the revised investment agreement, all 7.5% convertible senior secured notes due 2009 will be paid in full, as will all of DBSD's obligations under the revised credit facility.
The holders of general unsecured claims will receive partial payment.
DBSD is a subsidiary of ICO Global Communications (Holdings) Ltd., a Reston, Va., mobile satellite services company. The subsidiary filed for bankruptcy on May 15, 2009 in the U.S. Bankruptcy Court for the Southern District of New York. Its Chapter 11 case number is 09-13061.
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