3rd Quarter Earnings

[RickF]

Hi Gang!
Homer - if they where waiting to see what cashflow was available before anouncing (this would suggest that they have things almost ready to go?????) how they where going to handle the Feb finance - can you speculate on why they would need an investment bank to assist them??? I suspect that eveyone has seen this article but .....

http://www.businessweek.com/technolo...mpaign_id=yhoo

"In recent weeks the company retained investment bank Evercore Partners (EVR) as a financial advisor to help in the effort, according to Debtwire, a financial news service"

newbie here and appreciate everyones help!!!

[Newman]

Because I believe a good chunk of it will be used to pay against the $210 million coming due -- with the rest going on a Term Loan.

With the rest going on a term loan - That is why they would need an investment banker. Mel said in his interview that he did not want to eat up all of his free cash to pay back the debt, but he was waiting for acceptible terms. I agree with homer, in that Mel wants to see exactly how much free cash he will actually have before he makes a deal. (And, FYI: I think he is going to be making a deal for ALL of the 2009 debt, not just February. Would you agree with this Homer?)

[RickF]

I think he is going to be making a deal for ALL of the 2009 debt, not just February.

WOW! Ok - so I am admittedly no genuis when it comes to understanding this stuff but my thoughts of this statement are that .... wouldn't that make for "clear sailing" for Sirius and allow them to get down to business rather than spinning cycles trying to work the debt restructure?? This would be awesome ..... right??

[Newman]

Right. The fact is, there are no debt maturities for 2010, 11, or 12. Once the 2009 debt is taken care of, there is nothing to worry about until 2013... that would give 4 years worth of not working the debt restructure, which would definately be awsome.

It will still be there, but in the back of people's minds. Out of sight - Out of mind. (Which is why I did not think Mel would let it take this long to get it done, but debt markets are horrid these days after all).

[billhart22]

Right. The fact is, there are no debt maturities for 2010, 11, or 12. Once the 2009 debt is taken care of, there is nothing to worry about until 2013... that would give 4 years worth of not working the debt restructure, which would definately be awsome.

It will still be there, but in the back of people's minds. Out of sight - Out of mind. (Which is why I did not think Mel would let it take this long to get it done, but debt markets are horrid these days after all).

Just guessing, and I repeat, just guessing, what is the most likely scenario that you see, Newman? The only place I can get any logical answers is here on this forum.

Everybody else is all over the map and don't really have money invested, especially the newsletters (which I keep to a minimum). I know, by reading, that a lot of people here have a lot of serious money invested. I probably own the least amount of shares of anyone here, but still, I like to be informed.

Thanks,
Bill

[Newman]

As you clearly state, this is nothing but an educated guess: The company has a total of around 1 bllion in debt due in 2009:
210 Million is due in February 2009.
350 Million bank facility expires May 2009 (two seperate facilities, 250 and 100 mil)
1.75 Million due 9/29/09
400 Million due 12/09
33.2 Million is due December 21, 2009
Total = 994.95 Million.

Mel has stated that he is confident that the May bank notes can and will be extended. Total is now 644.95 million. As of the Q3 conference call, the company had nearly 360 million in cash on hand. That means that the company has cash on hand RIGHT NOW to pay off over half of the total 2009 debt due. Add to that the fact that Q4 should be grossly cash flow positive, that adds cash to the bank. Add to that the GM credit facility and Loral facility (strictly as payment deferals to those companies) and you can assume even more cash on hand.

I think that Mel is waiting to see how the Q4 numbers are going to look before making any decisions. If they will have quite a bit of Free Cash Flow, they can pay off the Feb debt and still have plenty of cash on hand for Q1 and Q2. If the cash flow is not going to be that great, they may need to hold back a bit of that cash in order to sustain themselves. I think Mel is looking for about 400 million in financing as of now. No need to deplete all of your cash reserves if you do not need to.

They had 360 million cash on hand at end of quarter, and have 210 million due in Feb. They could pay it off and still have 150 million, plus Q4 FCF. They are not in despiration mode yet as most people would like you to believe...

**edit: The 33.2 million dollars due 12/21/09 is a convert they have with Honda that has a strike price of 0.6913. If the stock is above 70 cents at that time, it will convert and Sirius will not have to pay it off.

[winagain35]

As you clearly state, this is nothing but an educated Add to that the GM credit facility and Loral facility (strictly as payment deferals to those companies) and you can assume even more cash on hand.

I may be mistaken, but I believe the GM credit facility is no longer available and the Loral facility has a stipulation that our market cap be above $1 Billion. We could get there with some good news, but our MC is well under $500 mil today.

[Newman]

win: I believe that is only for the "cash advance" portion of the credit line. I believe the credit facilities are still there to make payments to those entities, just not to borrow money from, which is why I stated "strictly as payment deferals to those companies".