DISH DBS Repays $2 Billion in Notes During Chapter 11

DISH DBS Corporation repaid $2 billion in principal, plus accrued and unpaid interest, on its 7.75% Senior Notes on July 28, 2026. EchoStar reported that the bankruptcy court authorized repayment and discharge of the related indenture obligations. The payment retired the notes that matured July 1. EchoStar’s July 28 report

The repayment followed a modified joint plan that combined DBS debt reduction with a proposed sale of DISH Wireless assets and treatment of wireless creditor claims. The July 22 disclosure statement projected a reduction in DBS funded debt from $9.75 billion to $5 billion at emergence, subject to further reductions under a cash sweep. Those figures describe the proposed capital structure. Modified disclosure statement, p. 88

EchoStar also reported that the separate AT&T spectrum transaction closed July 28 and that AT&T deposited $2.4 billion into the FCC Trust at closing. That funding advanced a recovery mechanism for eligible network creditors without determining their individual recoveries. EchoStar’s July 28 report

This account covers the July 22 plan disclosures and July 28 developments. It does not establish subsequent plan confirmation, closing of the proposed DISH Wireless asset sale to EchoStar, or plan effectiveness.

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The case identity and petition date appear in the modified disclosure statement, pp. 1 and 98.

DBS Repayment and the Proposed $5 Billion Capital Structure

Before the petition, EchoStar elected not to make approximately $183 million in interest payments due June 1 on three other DISH DBS note series: the 5.25% secured notes due 2026, 5.75% secured notes due 2028, and 5.125% unsecured notes due 2029. EchoStar said it deferred the payments to conserve liquidity pending the AT&T closing proceeds. These obligations were distinct from the 7.75% notes repaid in July. EchoStar’s June 1 report

The DBS debtors entered the restructuring support agreement on March 19 with holders of 82% of DBS note principal. By the July 22 disclosure statement, support exceeded 88%. The agreement contemplated retiring both 2026 note series while retaining the three longer-dated series. The disclosure statement reported that the 2028 secured-note indenture had already been amended to implement a quarterly cash sweep beginning with the quarter ending March 31, 2027. Modified disclosure statement, pp. 88–89

These principal balances exclude interest. The proposed post-emergence balances precede additional cash-sweep reductions. Modified disclosure statement, pp. 71 and 88 The July 28 report confirmed repayment of the $2 billion series; it did not establish retirement of both 2026 series. July 28 report

The DBS debtors said they had sufficient cash, cash equivalents, and receivables to fund ordinary operations and restructuring expenses without debtor-in-possession financing. Modified disclosure statement, p. 71

Wireless Assets and Financing Remained Conditional

The wireless debtors proposed selling substantially all their assets to EchoStar under a $300 million stalking-horse agreement, subject to higher or better bids. An independent special committee was investigating potential claims against insiders and affiliates, including whether those claims should be sold and whether the consideration was sufficient. The price did not allocate value among individual assets or causes of action. Modified disclosure statement, pp. 87–88

By July 22, the wireless debtors said they would seek final sale approval at an appropriate time instead of proceeding with their bidding-procedures motion. The proposed transaction remained subject to a sale order and completion of the committee’s investigation. Modified disclosure statement, p. 98

EchoStar had committed to a multi-draw financing facility of up to $85 million, subject to reductions under its terms. The proposed liens would rank behind the prepetition secured loan. The disclosure statement reported that the financing hearing had been adjourned to a date to be determined; it did not establish approval or borrowing under the facility. Approximately $56 million released from a restricted account on June 29 supplied immediate liquidity. Modified disclosure statement, pp. 97–98 and 102

Under the proposed plan treatment, if EchoStar became the successful buyer, credit-bid its allowed financing claims, and the purchase price exceeded those claims, the outstanding claims would reduce the price payable at closing dollar for dollar. The $300 million purchase price and financing commitment therefore cannot simply be added together as cash available to creditors. Modified disclosure statement, p. 56

Tower Claims and Separate Recovery Mechanisms

DISH Wireless asserted that FCC actions and the resulting spectrum sales excused performance under tower leases and other network agreements through force majeure, frustration of purpose, or commercial impracticability. Counterparties disputed those defenses. The July 22 disclosure statement described more than 200 lawsuits and more than $6 billion in asserted tower and infrastructure damages. These amounts were disputed demands. Modified disclosure statement, pp. 23–24 and 86

The modified joint plan addressed wireless claims as well as DBS notes. Wireless creditors could seek distributions from the wireless debtors’ assets to the extent their claims were allowed. Qualifying network claims could instead seek payment from the FCC Trust, subject to eligibility requirements and the trustee’s determination. The disclosure statement specified that a holder must elect between plan and FCC Trust recovery and could not recover from both without the applicable EchoStar party’s prior written consent. Third-party-payment offsets also restricted recoveries. Modified disclosure statement, pp. 29, 97 and 164

EchoStar established the FCC Trust on June 26, with Bank of New York Mellon as trustee. Covered claims included qualifying judgments, arbitration awards, and settlements connected with network construction, operation, maintenance, decommissioning, and related goods or services. Modified disclosure statement, p. 24 The July 28 SEC report confirmed funding of the $2.4 billion contribution anticipated in the disclosure statement. July 28 report

The DWLLC Claims Trust serves a separate function: directing recoveries associated with intercompany loan claims toward DBS note redemptions. After trust fees and expenses, up to $300 million would be allocated pro rata among specified 2028 and 2029 noteholders for optional redemptions at the applicable indenture prices. Excess recoveries would first redeem outstanding principal and accrued interest on the 2028 secured notes at par. Residual recoveries would redeem the 2028 and 2029 unsecured notes pro rata at par. The defined $300 million recovery cap was therefore not an absolute ceiling on distributions under the modified waterfall. Modified disclosure statement, p. 125

The disclosure statement cautioned that the DWLLC Claims Trust might recover substantially less than $300 million. Its actual recovery depended on eligibility determinations, competing claims, available trust assets, and value generated by the wireless sale. Funding of the FCC Trust did not resolve those allocation and eligibility questions. Modified disclosure statement, p. 164