The offering of the Notes is part of a series of transactions to refinance certain debt of XM in connection with the pending merger with Sirius.

The offering will be conditioned on the closing of the merger which remains subject to the approval from the Federal Communications Commission and satisfaction of other applicable conditions.

Sirius has filed a registration statement with the Securities and Exchange Commission to register the resale of the Sirius common stock delivered upon exchange of the Notes.

The coupon, exchange rate and other terms of the Notes will be determined at the time of pricing of the offering. The Notes will be XM Radio's unsecured, senior subordinated obligations, will be subordinated to any senior debt of XM Radio and will rank equally with any future senior subordinated debt of XM Radio.

The Notes will be fully and unconditionally guaranteed by XM Satellite Radio Holdings Inc. and each of XM Radio's subsidiaries which also guarantee XM Radio's other indebtedness.

The Notes will be offered in the United States to qualified institutional buyers pursuant to Rule 144A under the U.S. Securities Act of 1933, as amended (the "Securities Act"). The Notes have not been registered under the Securities Act or any state securities laws and may not be offered or sold in the United States or to U.S. persons absent registration or an applicable exemption from the registration requirements.

Concurrently with the offering of the Notes, Sirius will enter into share lending agreements with share borrowers, pursuant to which Sirius will lend shares to the share borrowers. Concurrently with the offering of the Notes, the share borrowers will sell the borrowed shares in a separate public offering.

The sale of the borrowed shares is intended to facilitate privately negotiated derivative transactions by which investors in the Notes will hedge their investment in the Notes. The share borrowers will be required to return the borrowed shares pursuant to the share lending agreement following the maturity date of the Notes or their earlier retirement.

The share borrowers will receive all of the proceeds from the sale of the borrowed shares. Sirius will not receive any proceeds from the offering of the borrowed shares, but will receive a nominal lending fee from the share borrowers.

While the borrowed shares will be considered issued and outstanding for corporate law purposes, Sirius believes that under U.S. generally accepted accounting principles currently in effect, the borrowed shares will not be considered outstanding for the purpose of computing and reporting earnings (loss) per share because the borrowed shares are required to be returned to Sirius.

associated report
Sirius Satellite Radio Announces Equity Offerings and Related Share Borrow Facility
New York - Sirius Satellite Radio Inc. has announced the commencement of an offering of shares of its common stock.

The common stock being offered represent shares of Sirius common stock that Sirius will be lending to affiliates of Morgan Stanley and Co. Incorporated and UBS Investment Bank, the share borrowers, pursuant to share lending agreements between Sirius and each of the share borrowers.

It is estimated that, based on current market values, approximately $375,000,000 of Sirius common stock will be sold in a fixed-price public offering described below, and up to approximately $65,000,000 of Sirius common stock will be sold as described below from time to time at prevailing market or negotiated prices.

The exact number of shares of Sirius common stock to be offered will depend on the terms of the concurrent offering of exchangeable senior subordinated notes described below and the hedging to be conducted by investors in such notes.

While the borrowed shares will be considered issued and outstanding for corporate law purposes, Sirius believes that under U.S. generally accepted accounting principles currently in effect, the borrowed shares will not be considered outstanding for the purpose of computing and reporting earnings (loss) per share because the borrowed shares are required to be returned to Sirius.

The common stock offering is being conducted concurrently with a private offering by XM Satellite Radio Inc. of $550 million aggregate principal amount of Exchangeable Senior Subordinated Notes due 2014 ("Notes") which will be exchangeable into shares of Sirius common stock.

The terms of the Notes, including the interest rate and exchange ratio, will be determined at the time that such offering is priced. The Notes have not been registered under the Securities Act or any state securities laws and may not be offered or sold in the United States or to U.S. person absent registration or an applicable exemption from the registration requirements of applicable securities laws.

In connection with the common stock offering, Sirius will enter into a share lending agreement with each of the share borrowers, pursuant to which Sirius will lend shares to the share borrowers. The share borrowers will sell a portion of the borrowed shares in a fixed-price public offering expected to close concurrently with the Notes offering.

After the closing of the fixed- price offering, the share borrowers will offer and sell the remaining borrowed shares in one or more registered public offerings at prevailing market or negotiated prices.

Over the same period that the share borrowers sell the remaining borrowed shares, the share borrowers or their affiliates expect to purchase at least an equal number of shares of Sirius common stock on the open market and/or enter into derivative transactions providing it with a synthetic long position equal to such number of shares.

Sirius will not receive any proceeds from the sale of its common stock by the share borrowers other than a nominal loan fee equal to $0.001 per share issued to the share borrowers. The share borrowers will be required to return the borrowed shares pursuant to the share lending agreements following the maturity date of the Notes or their earlier retirement.

Morgan Stanley and Co. Incorporated and UBS Investment Bank will act as sole underwriters for the sale of the borrowed shares. A prospectus can be obtained by contacting Morgan Stanley and Co. Incorporated, 180 Varick Street, New York, NY 10014; Attention: Prospectus Department or by email at [email protected] or by contacting UBS Investment Bank, Attention: Prospectus Department, 299 Park Avenue, New York, NY 10171, (888) 827-7275.

Related Links
XM Radio
Sirius
The latest information about the Commercial Satellite Industry

Memory Foam Mattress Review

SPACE MEDIA NETWORK PROMOTIONS Solar Energy Solutions Tempur-Pedic Mattress Comparison ... Newsletters :: SpaceDaily :: SpaceWar :: TerraDaily :: Energy Daily XML Feeds :: Space News :: Earth News :: War News :: Solar Energy News