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  1. zcurzan is offline
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    07-12-2008, 11:45 PM #1

    Question Hartleib Question

    Hartleib: (Anyone else with answers feel free to comment.)

    I know you've been involved as an investor in the industry for a long time, but I don't fully understand the entire background. Can you explain your position to me? I would prefer a couple of sentences, as opposed to a document pasted into the thread.

    Do you believe that Sirius brought an interoperable receiver to market and simply never activated it? If so, what receiver is it that you think is interoperable?

    Is your position that Sirius management hurt shareholders by overpaying in the merger exchange, because they could have taken XM's subscriber base if they simply used a interoperable radio?

    I keep hearing about a previous lawsuit from shareholders that you had some involvement in (preventing?). What was that?

    Thanks

  2. hartleib1 is offline
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    07-13-2008, 01:31 AM #2
    Yes. And it was a sham class action that would have caused shareholders to lose all rights. Also it would have indemnified Sirius Executives for all wrong doing! If anyone would like to talk send me your number in a private message and I will be happy to call back!

  3. zcurzan is offline
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    07-13-2008, 08:53 AM #3
    Do you believe that Sirius brought an interoperable receiver to market and simply never activated it? If so, what receiver is it that you think is interoperable?
    All of them?

  4. hartleib1 is offline
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    07-16-2008, 11:20 AM #4
    Most! One or the other but not both at the same time. Read Tylers take on this fourm he understands the Interoperable issue. Three types is the key.

    1. "Dual Mode" Receiver - a receiver capable of receiving the signals of Sirius, XM, or both at the same time

    2. "Switchable" Receiver - A receiver capable of receiving either Sirius or XM, but not both services at the same time.

    3. "Gateway" Receiver - A receiver capable of one switch only. i.e. Sirius receiver that can convert to XM, but can never be switched back.

  5. zcurzan is offline
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    07-16-2008, 12:08 PM #5
    Oh so you think the majority of satellite radios on the market released by either XMSR or SIRIUS are "switchable". Do you think they can switch back and forth, or are they merely gateways?

  6. hartleib1 is offline
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    07-20-2008, 10:46 PM #6
    XM Reaches Agreement With Senior Noteholders

    Tyler this looks like a very expensive deal. Does this cause a change to the value of the deal. It looks like a material change.15%

  7. zcurzan is offline
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    07-20-2008, 11:02 PM #7
    Why would the restructuring of debt in a post-merger transaction affect the value of the deal. Sirius went into this transaction knowing that a certain amount of XM's debt would need to be taken care of.

    Are you suggesting that because the rest of $1 billion plus debt that needs to be renegotiated that the value of XMSR is lower than when the transaction was proposed?

    It's not like XMSR went out and added $1 billion of unforseen debt to their capital structure.

  8. crfceo is offline
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    07-21-2008, 12:08 AM #8
    Hartlieb

    I keep getting crucified on this one, but I ask this without answer. Where in DC does anyone think that xm is getting 400 million dollars? They do not have it. It will have to come from Sirius which in my opinion....well...you already know my opinion.

    The approved proxy states:

    Adjustments to Prevent Dilution

    The stock exchange ratio will be appropriately adjusted to reflect fully the effect of any stock split, reverse stock split, stock dividend (including any dividend or distribution of securities convertible into SIRIUS common stock or XM common stock), reorganization, recapitalization, reclassification or other like change with respect to SIRIUS common stock or XM common stock having a record date on or after the date of the merger and prior to the completion of the merger.
    Last edited by crfceo; 07-21-2008 at 12:10 AM.

  9. crfceo is offline
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    07-21-2008, 07:55 AM #9
    ...from my fingertips to Gods ear....here's the 400 million:


    XM Announces Offering of Senior Notes as Part of Merger Refinancing



    WASHINGTON , July 21 /PRNewswire-FirstCall/ -- XM Satellite Radio Holdings Inc. (Nasdaq: XMSR) announced today that it is launching an offering of $400 million aggregate principal amount of new senior notes. The offering is part of a series of transactions to refinance certain debt of XM in connection with the pending merger with SIRIUS Satellite Radio Inc. The offering will be structured in a manner that will permit it to be unwound if the merger is not consummated. The closing of the pending merger remains subject to the approval from the Federal Communications Commission and satisfaction of other applicable conditions.




    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"), to persons outside of the United States pursuant to Regulation S under the Securities Act and applicable private placement exemptions in such jurisdictions. 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.

  10. zcurzan is offline
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    07-21-2008, 07:56 AM #10
    The way I see around that, is that XM doesn't need to dilute to pay. The money comes due upon merging, at which point you dip into the combined company's coffers.

    EDIT: Okay scratch that. That is clearly new debt which will affect the ratio.

    EDIT2: I can't find the actual full length article. When does this occur? Are they issuing them now, or is this going to be issued upon the closure of the merger. That makes a huge difference.
    Last edited by zcurzan; 07-21-2008 at 08:16 AM.

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