xm just refied another 400 million!

XM to Commence Exchange Offer for its 1.75% Senior Convertible Notes Due 2009

Friday, June 27, 2008; Posted: 08:20 AM 7 Stocks You Need To Know For

WASHINGTON, June 27, 2008 /PRNewswire-FirstCall via COMTEX/ -- XMSR | Quote | Chart | News | PowerRating -- XM Satellite Radio Holdings Inc. (Nasdaq: XMSR | Quote | Chart | News | PowerRating) today announced that it had reached an agreement with holders of approximately 94.6% of its $400 million aggregate principal amount of 1.75% Senior Convertible Notes due 2009. Pursuant to the agreement, XM will commence, prior to July 10, 2008, an exchange offer to exchange new senior convertible notes due 2009 of XM for the existing notes. The new notes will bear interest at a rate of 10%, but will otherwise contain substantially the same terms as the existing notes. The 10% interest rate on the new notes will begin to accrue on July 2, 2008. The noteholders that are party to the agreement have agreed not to assert any claim that the proposed merger of XM with a subsidiary of Sirius Satellite Radio constitutes a "Fundamental Change" under the existing indenture, which, if any, would require an offer be made by XM to repurchase the existing notes at par within a specified period following the merger. The exchange offer will be conditioned on the closing of the merger and to other customary conditions for an offer of this nature. The Offer will not be subject to a minimum condition.
XM's board of directors is not making any recommendation to holders of the existing notes as to whether or not they should tender any existing notes pursuant to the exchange offer. This announcement does not constitute an offer to sell or exchange, or the solicitation of an offer to purchase, any securities. The exchange offer will either be made pursuant to an effective registration statement filed with the Securities and Exchange Commission or pursuant to Section 3(a)(9) of the Securities Act of 1933, as amended. Tenders of existing notes may only be made pursuant to XM's offering memorandum or prospectus, as applicable, which will be sent to holders of the existing notes. The offering memorandum or prospectus, as applicable, and related documents, will set forth the complete terms of the exchange offer.

SOURCE XM Satellite Radio Holdings Inc.

http://www.tradingmarkets.com/.site/...0News/1719253/

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Originally Posted by homer985

Yes, they can still get new financing... and do have current financing.

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Well I guess that this reinforces what homer985 said yesterday and might start to quite down some of the analysts that were so sure "financing/terms might be difficult".

FWIW, this isn't a refinance or a new finance. This is just an exchange of current Notes.

XM upped the Coupon from 1.75% to 10%, in exchange for these bondholders to give up their put rights on these notes. I estimate that the increase in interest rate from 7/2/08 to 12/1/09, will cost XM/Sirius an additional $46 million or so in increased interest. Everything else in the Notes, remains the same.

XM has approximately $1.2 billion in puttable debt. This $400 million is now off the table, as far as being puttable. That leaves another $800 million more that needs to also be exchanged.... including $600 million worth of 9.75% notes, due 2014; and $200 million worth of floating rate notes, due 2013. I'm betting that we'll see an announcement in the coming weeks for exchanges of these too.

Refinancing involves issuing new notes to raise $$ and using that $$ to buyback older - maturing debt. The new notes would likely have a different coupon and further out maturity date. This exchange does none of this.


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