Dish Network 2014 Annual Report Download - page 49

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Tracking Stock. Further, Effective July 1, 2012, we and EchoStar formed Sling TV Holding L.L.C. (“Sling
TV,” formerly known as DISH Digital Holding L.L.C.), which was owned two-thirds by us and one-third
by EchoStar. Sling TV was formed to develop and commercialize certain advanced technologies.
Effective August 1, 2014, EchoStar and Sling TV entered into an Exchange Agreement pursuant to which,
among other things, Sling TV distributed certain assets to EchoStar and EchoStar reduced its interest in
Sling TV to a ten percent non-voting interest. We now have a ninety percent equity interest and a 100%
voting interest in Sling TV. On February 9, 2015, we launched a live, OTT service under the Sling TV
brand. See Note 20 in the Notes to our Consolidated Financial Statements in this Annual Report on Form
10-K for additional information.
 Intercompany agreements with EchoStar. In connection with and following the Spin-off, we and EchoStar
have entered into certain agreements pursuant to which we obtain certain products, services and rights from
EchoStar, EchoStar obtains certain products, services and rights from us, and we and EchoStar have
indemnified each other against certain liabilities arising from our respective businesses. See Note 20 in the
Notes to our Consolidated Financial Statements in this Annual Report on Form 10-K for further discussion
of our Related Party Transactions with EchoStar. The terms of certain of these agreements were
established while EchoStar was a wholly-owned subsidiary of us and were not the result of arm’s length
negotiations. The allocation of assets, liabilities, rights, indemnifications and other obligations between
EchoStar and us under the separation and other intercompany agreements we entered into with EchoStar, in
connection with the Spin-off, may have been different if agreed to by two unaffiliated parties. Had these
agreements been negotiated with unaffiliated third parties, their terms may have been more favorable, or
less favorable, to us. In addition, conflicts could arise between us and EchoStar in the interpretation or any
extension or renegotiation of these existing agreements.
 Additional intercompany transactions. EchoStar and its subsidiaries have and will continue to enter into
transactions with us and our subsidiaries. Although the terms of any such transactions will be established
based upon negotiations between EchoStar and us and, when appropriate, subject to the approval of a
committee of the non-interlocking directors or in certain instances non-interlocking management, there can
be no assurance that the terms of any such transactions will be as favorable to us or our subsidiaries or
affiliates as may otherwise be obtained between unaffiliated parties.
 Business opportunities. We have historically retained, and in the future may acquire, interests in various
companies that have subsidiaries or controlled affiliates that own or operate domestic or foreign services
that may compete with services offered by EchoStar. We may also compete with EchoStar when we
participate in auctions for spectrum or orbital slots for our satellites. In addition, EchoStar may in the
future use its satellites, uplink and transmission assets to compete directly against us in the subscription
television business.
We may not be able to resolve any potential conflicts, and, even if we do so, the resolution may be less favorable to
us than if we were dealing with an unaffiliated party.
Other than certain arrangements with EchoStar that we entered into in connection with Sling TV, which, subject to
certain exceptions, limits EchoStar’s and our ability to operate an IPTV service other than operated by Sling TV, we
do not have agreements with EchoStar that would prevent either company from competing with the other.
We rely on key personnel and the loss of their services may negatively affect our businesses.
We believe that our future success will depend to a significant extent upon the performance of Charles W. Ergen,
our Chairman, and certain other executives. The loss of Mr. Ergen or of certain other key executives could have a
material adverse effect on our business, financial condition and results of operations. Although all of our executives
have executed agreements limiting their ability to work for or consult with competitors if they leave us, we do not
have employment agreements with any of them. To the extent our officers are performing services for EchoStar,
this may divert their time and attention away from our business and may therefore adversely affect our business.