ENGLEWOOD, Colo. -- DISH Network Corporation (NASDAQ:DISH) ("DISH") announced today that its Board of Directors has approved a proposed rights offering to raise proceeds of approximately $1 billion. All DISH stockholders will be granted the right to participate in the offering and subscribe for newly-issued shares on a pro rata basis. The proceeds from the rights offering are intended to be used for general corporate purposes, including investments in the wireless business.
DISH intends to distribute transferable subscription rights pro rata to holders of record of DISH's Class A and B common stock, and outstanding convertible notes (based on the number of Class A shares into which those notes are convertible as of the record date) on November 17, 2019. The subscription rights will entitle the holder to acquire newly-issued shares of DISH's Class A common stock. The subscription price will be $33.52 per share of Class A common stock. The rights offering will not provide for over-subscription rights.
Charles W. Ergen, who beneficially owns approximately 51.6% of DISH's Class A and Class B common stock (calculated assuming conversion of all outstanding Class B common stock into Class A common stock) as of October 31, 2019, has informed DISH that he intends to fully exercise all subscription rights allocated in respect of the shares he beneficially owns. DISH had 254,623,280 shares of Class A common stock and 238,435,208 shares of Class B common stock outstanding as of October 31, 2019. All outstanding shares of Class B common stock are beneficially owned by Mr. Ergen. To the extent any subscription rights would expire unexercised following the expiration of the rights offering, Mr. Ergen also intends to purchase all shares of Class A common stock that are not subscribed for by stockholders in connection with the rights offering. DISH expects to enter into a commitment letter with Mr. Ergen memorializing this intention.