Dish Network 2009 Annual Report Download - page 145

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DISH NETWORK CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - Continued
F-55
Under our receiver agreement with EchoStar entered into in connection with the Spin-off, we have the right but
not the obligation to purchase digital set-top boxes and related accessories, and other equipment from EchoStar
for a period ending on January 1, 2011. We also have the right, but not the obligation, to extend the receiver
agreement annually for an additional year. The receiver agreement allows us to purchase digital set-top boxes,
related accessories and other equipment from EchoStar at cost plus a fixed margin, which varies depending on
the nature of the equipment purchased. Additionally, EchoStar provides us with standard manufacturer
warranties for the goods sold under the receiver agreement. We may terminate the receiver agreement for any
reason upon sixty days written notice to EchoStar. EchoStar may terminate the receiver agreement if certain
entities were to acquire us. The receiver agreement also includes an indemnification provision, whereby the
parties indemnify each other for certain intellectual property matters.
“General and administrative – EchoStar”
Product Support Agreement. In connection with the Spin-off, we entered into a product support agreement
pursuant to which we have the right, but not the obligation to receive product support from EchoStar (including
certain engineering and technical support services) for all digital set-top boxes and related accessories that
EchoStar has previously sold and in the future may sell to us. The fees for the services provided under the
product support agreement are equal to EchoStar’s cost plus a fixed margin, which varies depending on the
nature of the services provided. The term of the product support agreement is the economic life of such
receivers and related accessories, unless terminated earlier. We may terminate the product support agreement
for any reason upon sixty days prior written notice. In the event of an early termination of this agreement, we
are entitled to a refund of any unearned fees paid to EchoStar for the services.
Real Estate Lease Agreements. We have entered into certain lease agreements pursuant to which we lease
certain real estate from EchoStar. The rent on a per square foot basis for each of the leases is comparable to per
square foot rental rates of similar commercial property in the same geographic area, and EchoStar is responsible
for its portion of the taxes, insurance, utilities and maintenance of the premises. The term of each of the leases
is set forth below:
Inverness Lease Agreement. The lease for certain space at 90 Inverness Circle East in Englewood,
Colorado, is for a period ending on January 1, 2011.
Meridian Lease Agreement. The lease for all of 9601 S. Meridian Blvd. in Englewood, Colorado, is
for a period ending on January 1, 2011 with annual renewal options for up to two additional years.
Santa Fe Lease Agreement. The lease for all of 5701 S. Santa Fe Dr. in Littleton, Colorado, is for a
period ending on January 1, 2011 with annual renewal options for up to two additional years.
Gilbert Lease Agreement. The lease for certain space at 801 N. DISH Dr. in Gilbert, Arizona expired
on January 1, 2010.
EDN Sublease Agreement. The sublease for certain space at 211 Perimeter Center in Atlanta,
Georgia, is for a period of three years, ending on April 30, 2011.
Services Agreement. In connection with the Spin-off, we entered into a services agreement pursuant to which
we had the right, but not the obligation, to receive logistics, procurement and quality assurance services from
EchoStar. This agreement expired on January 1, 2010. However, we and EchoStar have agreed that following
January 1, 2010, we will continue to have the right, but not the obligation, to receive from EchoStar the
services previously provided under the services agreement pursuant to the Professional Services Agreement as
described above.