Mel wants to F his shareholders buy stealing the combined co. from you.

I absolutely agree that that would be the perfect scenario, but in reality Mel "Bad"Karma - zin has been one let down after the other. The realists out here know there will be no big news and the market will just ignore the launch of new radios and best of programming. This shit stock will still be hovering around a dollar after Oct. 6th. His wisecrackin and sarcastic rambling has upset this stock even more. He is a great disappointment, and I am onboard with a full investigation into him and his board, and what the **** they are up to, because its obvious something stinks, and if you can't smell it, your brainwashed.
I almost believe Mel is on a mission, to make these (you and me) unsophisticated shareholders pay for not backing him 100% and trying to throw a wrench into his master plan.
To buy it up cheap and sell it to the highest bidder, at the cost of the shareholder.
Until he proves differently, You cannot sway my view.

MICHAEL HARTLEIB
P.O. Box 7078
Laguna Niguel, CA 92607


FILED VIA ECFS

September 12, 2008

Marlene H. Dortch
Secretary
Federal Communications Commission
445 12th Street, SW
Washington, D.C. 20554

Re: Notice of Ex Parte Presentation; Consolidated Application for Authority to
Transfer Control of XM Radio Inc. and Sirius Satellite Radio Inc.
MB Docket No. 07-57

Dear Ms. Dortch:

In accordance with Section 1.1206 of the Commission’s rules, 47 C.F.R. § 1.1206, and the Commission’s Public Notice dated March 29, 2007 (DA 07-1435), and as directed by Commission staff, this ex parte report is submitted for the record.

On Thursday, September 11 at approximately 1:30 pm PST, I received a joint call from the Media Bureau’s Royce Sherlock and Marsha Glauberman. I was first informed that Rosemary Harold was no longer with the Bureau. Ms. Harold was the Bureau staff member who had been assigned to my Petition for Declaratory Ruling filed in this Docket concerning compliance with the interoperability mandate. No explanation was provided as to why I was being formally notified that Ms. Harold had left the Bureau.

I was next asked for information about the Petition for Review filed with the U.S. Court of Appeals for the District of Columbia Circuit. I answered truthfully that from my knowledge and perspective (based on how my Petition for Declaratory Ruling had been handled), that grounds existed to allege that the FCC had allowed itself to be drawn into and thereby become complicit in a potentially criminal enterprise of the two SDARS licensees to combine the entire SDARS spectrum into one entity. I also pointed out that grounds also existed to find the FCC was drawn into a well-orchestrated conspiracy to prevent and preclude consumer’s access to or knowledge of interoperable devices and that the purpose of this conspiracy was to prevent the two licensees from having to compete through the availability of interoperable devices as the Commission had required ten years earlier.


September 12, 2008
Federal Communications Commission
Page 2

I also raised concerns about the Commission’s refusal to disclose incriminating documents that the licensees had kept secret by obtaining protective orders and which the Commission did keep secret
despite demands that they be placed in the record. This refusal raises another question suggesting
the merger approval was prejudged and the proper procedures to ensure an impartial decision based on public interests and not those of the licensees ignored resulting in a breach of the statutory mandate to serve the public’s interest and risk becoming complicit in the fraud perpetrated by the two SDARS companies.

I commented in addition that it was not only unconscionable and perhaps a violation of Federal Law for this Commission to withhold documents from the Public’s view, but most importantly, the Department of Justice. The FCC failed to provide the Department of Justice with documentation by which these two SDARS companies admitted to conspiring to restrain free trade in violation of anti-trust laws.

I informed Ms. Sherlock and Ms. Glauberman that Chairman Martin’s decision to unilaterally reclassify a properly formatted Petition for Declaratory Ruling was an absolute abuse of power and a violation of the Chairman’s duty to protect the public’s interest.

I informed them that it is quite likely they will have to re-address the FCC’s merger decision if the Federal Courts rule that the FCC violated their procedures and rescinds and/or enjoins said merger. I stated that the Commission may be addressing this issue all over again in the not so distant future and both acknowledged that that could be the case.

I stated I would be submitting my Petition for Review with this Ex-Parte to be part of this official docket. I was under the impression Docket 07-57 was closed but, Ms. Sherlock and Ms. Glauberman informed that I must file an Ex Parte detailing our discussion, hence, this submission.

Respectfully,


Michael Hartleib


MH/th

Encl.

First thing... Hartlieb, your emotions will be your downfall.

Secondly... it is obvious most on this thread were not around in 2002... the last time this company had its back up against the wall to do a refinancing. Ironically, it was the last time Sirius (and XM) both cratered as there were questions regarding its viability. I was one of those heavily questioning Sirius at the time and refused to invest in it, outside of a token purchase at $0.94 that I flipped at $6.99.

With that said, this stock is cratering for one reason -- will they or won't they get the financing they need. Shareholders are pissed at Karmazin for not saying more -- but they don't understand he can't say much more or risk exposing himself to more lawsuits. What Karmazin did say last week, I felt was completely misunderstood -- I suggest everyone listen to the refinancing plans again: http://www.4shared.com/file/62672080.../karmazin.html

With the debt market current condition -- it is understandable that the Street doesn't believe that Sirius will get what it needs -- and it is being punished for it. I do not believe that Karmazin can say anything more until a deal is in place -- beyond what was said above.

I posted more thoughts on this on Yahoo earlier... here's what I said:

The problem that so many are not realizing is that Sirius isn't looking to increase its debt load here -- and frankly, doesn't need to even raise any new cash in the end.

The expiring Feb09 convert holders (mostly held by GS) have already seeked out an offer to exchange them for new converts. Such a move would require no new debt or additional debt -- just the exchange of old converts for new ones under different terms. This is what Karmazin is attempting to avoid, as doing this would greatly increase the coupon and lower the exchange price... which is not a shareholder friendly move. Indeed, many shareholders have been blasting Karmazin of late -- but most don't understand that what he is doing right now with this, is looking out for the shareholders. If he was not, he'd just take the offer from Goldman. But instead, he's seeking out a bank loan instead -- which would eliminate the dilution from the convertible... which would be a shareholder friendly move.

That said -- some are suggesting BK... however before BK can be approved you have to be demonstrating liquidity problems. Sirius is not having liquidity problems. They have $450 million cash, a cash burn rate of about $20~30 million per quarter and have been cutting expenses with the closing of the merger. So liquidity and the ability to service the debt is not an issue.

The issue is being able to deal with the $300 million maturing debt in February. Personally, I happen to find it hard to believe that GM and Honda would sit by and allow the $300+ million investment they've made into XM be voided out in bankruptcy; let alone their lucrative revenue share contracts possibly be changed. In fact, GM, Honda, Ford and Chrysler all stand to be losers in letting this thing go bankrupt -- all over $300 million? Pooling funds from strategic partners has been done to save these companies many times in the past... don't deny that that could be a last ditch option of the company.

Here's one final thought to think about... the Sirius portion of the debt is approximately $1.27 billion and is NOT secured by any of their assets. Furthermore, Sirius' FCC license on their books is listed as valued at $83.6 million -- however they note the Fair Value of the license/spectrum is in the $1.0~1.5 billion range... it should be easy to see that Sirius has the capacity to add new Senior Secured debt against their assets. Especially since it wouldn't increase the total debt in the long run.

What we're seeing is an understandable bear attack on this company -- with the attackers taking advantage of the bear market, the worldwide credit crisis and a newly merged company that is in need of refinancing (that could be expensive, deepending on the condition of the market) -- and the fact that the company can't say much about what is going on... this leaves them open for a major attack on their stock. Which has obviously occured.

The fact is, the company is not levered as much as most believe (based on fair value for the spectrum); they're not looking to increase their debt; and are trying to avoid the pressure of having to exchange for a non-shareholder friendly new convertible. And if they do take the Goldman exchange offer? Increasing the coupon from 2.5% to 10.0% would increase the interest expense by $22 million per year. While expensive, it certainly wouldn't cause a liquidity issue in the company, IMHO.

~~~~~~~~~~~~~~~

Following up on this previous post -- I note that the two investment banks involved in the last round of financing for Sirius/XM was UBS and Morgan Stanley. Which ironically, are two of the investment banks that don't seem to be having problems in this latest crunch.

So again, there are banks out there for Sirius to work with on a bank loan.




-----------

So what am I saying here? I'm saying that I don't believe that Karmazin is getting a fair rap in this thread. I know that this won't be a popular statement -- but the fact is, I worked for Karmazin back in the 90's and he was ALL about taking care of the shareholders. In fact, that was the most important thing in his company... it drove us programmers crazy and was partly to blame for the current condition of the radio industy today, IMHO.

I'm sorry Hartlieb, I once again disagree with you vehemently. You're once again drifting into conspiracy theory land -- that I don't believe in. Nevertheless, with regards to your claims about Karmazin screwing the Infinity shareholders in 1990's -- you are wrong. Us shareholders were well taken care of with big fat premiums when he took it private... at a time when the pps had stagnated. He did not screw the shareholders, in the least. Again, you're letting your emotions cloud your judgement.

And as I stated above (and in other threads regarding Goldman) -- he is very much looking out for shareholders now. I didn't agree with the merger at first -- but as the retail market died, I see now that it was necessary. He struck a fair deal for the merger... it is not his fault that the FCC/DOJ took as long as it did; nor is it his fault that the debt market tanked as the merger closed. I personally cannot fault the guy for NOT saying that "everything was just peachy, with rose-colored glasses on"... because it's not. Instead, I see him attempting to refi the maturing debt, while looking out for the shareholders. I can't fault him for that.

Sorry, disagree.


P.S. - There is not one shred of evidence to support a claim that he is attempting to "steal" the company from the shareholders. That was merely a response to a question asked by a reporter, in which he even said he wasn't going to do it. If you're calling him a liar -- then fine. But watch your emotions... you're going to (once again) see things that just aren't there. I point out the headline to this thread that YOU started:

"Mel wants to F his shareholders buy stealing the combined co. from you."

Prove it...

---------

Homer, fantastic posts. I hope you are right. I think we all would like to see Sirius AND Mel be succesful in the long run. I have been disappointed in the recent activity and statements. Couple that with the widespread systemic problems in the market and it is pretty natural for people to question what is going on.

I have been telling my girlfriend that we will be fine in the long run and to relax. I truly believe that. I look forward to eating my words, apoligizing or admitting I am wrong if Mel does turn the pps around. Just hard to keep the faith in him at this point in time.

No need to apologize -- as shareholders you have every right and duty to question everything, all the way up to the top when a stock craters like this. I just happen to think there may be too much emotion involved right now, as there should be -- having seen the stock implode so much. But at the same time, I don't know what more could have been done.

I read comments here and elsewhere where the posters are parsing words and statements... that is easy to do when the chips are down. People are mad and they want answers -- but I don't think there is one simple or satisfactory answer that can be made -- without it being seen as a "pump" or legally questionable.

I'm not going to sit here and tell you to relax, that everything is going to be okay -- I don't know that that is true. I'm just saying that I don't know that this is Karmazin's fault - that is all.

One other thing with regards to the original premise of this thread... the EV on Sirius/XM currently sits at $5.3 billion. Despite what Karmazin said about the debt markets and privatizing -- don't be fooled, if he wanted to take the company private or sell it to a buyer... at this current EV, he could do so easily. For example, CBS had $2 billion in FCF in 2007 - with $1.3 billion cash on the books... does anyone really think that they couldn't come up with the financing to buy this company for $5-6 billion?

That said, going private via an LBO? $5 billion is peanuts for private equity right now... but Karmazin wasn't talking about now in that article, he was talking about perhaps doing it when the company has actual earnings and cashflow; however with a high number of retail shareholders, it would have to be at a high premium for it to gain approval. I think way too much was being parsed by a cursory statement he made, obviously cued by the reporter from the Wall St. Journal. Never trust what you read without hearing a recording of the interview.



-------

Nice spin Homer! Keep the faith as mine is gone! I have talked to McBride, Sarah [Sarah.McBride@wsj.com] for over 18 months. I was on the phone with her for 45 minutes before she interviewed Mel and today after. Mel did say that he would love to take this co. private now! At this price, if he could finance the deal. He would F us now if he could. Homer you are a SMART GUY PLEASE STOP THE SPIN!

I agree with you Homer. I do not think ANY of this is Mel's fault. People have pointed out how Mel has disappointed us since he signed on... I have not been disappointed in Mel AT ALL since he signed on, and I do not see reason to stop believing in him now.

Hartlieb: As I said before, if Mel comes out and makes a private buyout offer at the $1.50 range, I'll join your in a lawsuit, as well as vote all of my shares against it. Otherwize, I remain of the opinion that Mel is working on turning this company around. Yes, he will sell or take it private eventually, but that will be done later when cash flow and earnings have materiallized, and all of us stockholders will make a very nice premium.

I support Karmazin. I just wish what ever was going to happen would happen faster! (Of course, I realize why it can't or won't happen as fast as I want it to)

Hartlieb -- your posts continue to be emotional... as I said, that will be your downfall.

Mistake #1 -- trusting anything discussed with a reporter... and BTW, I too have had several conversations with Sarah since 2004 (for various reasons). You dont have to try and impress me with who you know, because it doesn't.

Mistake #2 -- calling my post "spin", when all I presented were facts. If you have something factual to prove my facts wrong -- then please do so. Don't just sit there and claim you talked to a reporter, therefore you know more than everyone else and draw conclussions from that conversation. Because as has been proven several times in the past -- you've often drawn wrong conclussions. This is now the second time that I'm asking you to "prove" your claims that Karmazin is trying to "F" the shareholders and "steal" the company from them. A questionable conversation you had with a reporter, doesn't count.

Mistake #3 -- admitting to and insinuating that Sarah told you what amounts to insider information (IMHO), with regards to Karmazin's desire to take the company private now. Because if it does happen, it opens the door for lawsuits and/or complaints filed against McBride -- naming you in them as well. You're treading on thin water here, FYI.

The point you missed, is that Karmazin would never get shareholder approval to sell the company for $1.50 share. And he knows that. Which is why he stated he wouldn't do it before the company had better financials -- at which time the company's stock "should" be in a much better place than it currently is.

This thread is ludicrous... and frankly, you're starting to demonstrate those questionable qualities again, based on your belief in conspiracies. And when you add emotion into it, like you have, it gives the impression that you've gone over the deep end.



-----

Homer I appreciate your concern and can assure you my emotions are in check. Also as far as the deep end is concerned I am far from it.

You have the right to believe Mel has the shareholders best interest in mind I don’t. I was in the NY court room and know how hard Sirius tried to strip away all of their shareholders rights. They indeed almost succeeded. Anyone that wants to keep the faith can I will reserve mine for church.

Let’s make one thing perfectly clear Mel said “I would love to take the company private at these levels” just because he can not get the deal done today does not make me feel warm and fuzzy inside. He then goes on to say it is more feasible in 2009 again does not make me feel warm and fuzzy.

The shareholders have stood by this company through many difficult years and I ask why we do not deserve to reap the rewards over the long haul, I would argue we have earned that right. To allow private equity to take us out at $1.00 to $4.00 does not reward many of the long term shareholders.

My agenda is clear disseminating the facts, fight for due process, expose what has transpired here and to protect the remaining value of my 200,000 shares. Homer I ask why are you here and how many shares do you own? I do not mean any disrespect I know you are in the industry, but why so much time on the SDARS issue?

Management looking out for their shareholders. What a concept!!!


Shares of flash memory card maker SanDisk Corp. soared Wednesday, a day after the company rejected a $5.9 billion bid by Samsung Electronics Co Ltd.

Milpitas-based SanDisk (NASDAQ: SNDK) was up about 45 percent in mid-morning trading to $21.60.

Samsung currently pays SanDisk about $350 million a year in royalties to use its flash technology, and SanDisk said that while Samsung's $26-a-share cash offer -- which represents an 80 percent premium to its Monday close -- undervalued the company, it would be open to discussing an offer that recognized SanDisk's "intrinsic value."

In a letter to Seoul, Korea-based Samsung vice chairman and CEO Yoon-Woo Lee, SanDisk said the offer is “an opportunistic attempt to take advantage of SanDisk’s current stock price.” The board said the stock price is “depressed” because of business cycles in the industry.

Eli Harari, chairman and CEO of SanDisk said, “We believe Samsung’s proposal does not provide appropriate value to our stockholders and is opportunistically timed at the trough of an industry-wide downturn. We believe we have the strategy, execution record, innovation and financial resources to return to profitable growth and be the flash memory leader in new growth markets in mobile devices, solid state disk, and portable consumer electronics.”

SanDisk is advised by Goldman Sachs Group Inc. and Morgan Stanley

Hey...I for one wouldn't mind a $4 offer to go private. I've been in it a long time and averaged down enough that $4 would make me a profit.

I have taken my lumps with every other long...and as much as I love the product, and would love to ride the stock into the stratosphere...at this point if I can get out with a profit(or even break even!) I'd take it.

But all this is speculation. It's still a waiting game. Alot can happen over the next few quarters.

Mr. Hartleib, as most of us who question Mel's decisions, we are teamed up against, as I can see is being done to you.
Just wanted to let you know, there are some of us shareholders out here that absolutely agree with you. I still stand behind your statements, I don't believe you are empowering conspiracy theory, I believe you speak facts most just want to block out or try to spin into some rosy future.
Ultimately, Mel is a Billionaire that will do whatever is necessary to retain his billions, I do not believe we are in his best interests. He's just another fat cat CEO, and I know where his loyalty lies, in his bank account.
-Jason

Karmazin wants to see SIRI XM become a media giant. He wants it to be competitive with all of AM/FM radio and blow their doors off. Cramer and GS, NAB execs and sundry media rivals that Karmazin has known (and stepped on) throughout his career are laughing at Mel Karmazin's current predicament. Karmazin seeks the last laugh. He hungers for the success of SIRI as much as he does the money. The money is the measuring stick.

Now Harteib said that Mel F'ed the shareholders with his in-and-out public/private/public deals with his former company. Homer said that this did not happen - that shareholders made money in these transactions.
I have not verified how those old deals transpired. Who is telling the truth?

This is our new concern, that Mel will sell us out before we can make a profit. We are gun shy b/c we got screwed in the merger. Those of us XMSR holders got doubly screwed. Mel said that if anybody bets against him and gets screwed in the process - so be it.

Cramer and GS and all those old rivals really got a belly-laugh out of that remark. They pretend to think that Mel has lost the killer instinct, as they laugh. They must remember that he who laughs last, laughs loudest.

Tell you what, here are the facts -- so that everyone can see just how hard Karmazin ****ed his shareholders at Infinity (sarcasm intended, for those not figuring it out)...

Infinity was a private company for 14 years -- from 1972 to 1986. They did an IPO, then went private again in 1988. Did he screw the shareholders then? Doubtful... radio was nothing to invest in back in the 1980's. It had no real value until the mid 1990's.

It then went public again in 1992, where it remained public until he sold/merged it with Westinghouse/CBS in 1996. Did he screw the shareholders then? Well, the Market Cap on Infinity was about $2 billion -- he sold it to Westinghouse/CBS for $3.9 billion in stock... a 95% premium. And then sold/merged the whole thing into Viacom for $35 billion a few years later, in 1999.


~~~~~~~~~~~~~~~~~~~~~~

The Company was incorporated in 1972 in Delaware and first issued shares of its common stock to the public in June 1986. In August 1988, the Company became privately held as a result of a merger (the "Merger") with a company whose stockholders were the Company's principal stockholders and executive officers at the time. The Company was the surviving corporation in the Merger. On February 5, 1992, the Company and certain holders of warrants exercisable for shares of the Company's Class A Common Stock sold 13,788,826 shares of Class A Common Stock through an initial public offering (the "Common Stock IPO"). In addition, on May 13, 1993, the Company and certain holders of warrants exercisable for shares of the Company's Class A Common Stock sold 8,148,814 shares of Class A Common Stock through another public offering (the "Second Common Stock Offering").

.......................................

The aggregate market value of the voting stock held by non-affiliates of the registrant as of March 14, 1996 was approximately $2,027,918,626. As of March 14, 1996, 78,203,141 shares of Class A Common Stock, excluding 4,191,218 treasury shares, 8,319,045 shares of Class B Common Stock, and 1,116,257 shares of Class C Common Stock were outstanding.

.......................................

On June 20, 1996, Westinghouse Electric Corporation, a Pennsylvania corporation ("Westinghouse"), R Acquisition Corp., a Delaware corporation and a wholly owned subsidiary of Westinghouse ("Sub"), and the Company entered into an Agreement and Plan of Merger dated as of such date (the "Merger Agreement"). The Merger Agreement provides for the merger (the "Merger") of Sub with and into the Company, with the Company as the surviving corporation following the Merger. The Merger Agreement provides, subject to the terms and conditions set forth therein, for the Company's stockholders to receive, at the effective time of the Merger, the right to receive 1.71 shares of the Common Stock, par value $1.00 per share, of Westinghouse in exchange for each share of Common Stock of the Company. Following the Merger, the Company will be a wholly owned subsidiary of Westinghouse.

.......................................

New York City -- (June 20, 1996) Westinghouse (NYSE:WX) and Infinity (NYSE:INF) announced today a definitive merger agreement involving approximately $3.9 billion in Westinghouse common stock, creating the country's preeminent radio broadcaster.

.......................................

On September 6, 1999, Viacom Inc. and CBS entered into an agreement and plan of merger, as amended. Pursuant to this merger agreement, each share of CBS common stock, par value $1.00 per share, that is issued and outstanding immediately prior to the effective time of the merger will be converted into the right to receive 1.085 shares of Viacom non-voting Class B common stock and each share of CBS series B preferred stock, par value $1.00 per share, will convert into the right to receive 1.085 shares of Viacom series C preferred stock. The merger will be accounted for by the purchase method of accounting. The merger is contingent upon, among other things, regulatory and CBS shareholder approval. This transaction is expected to close in the first half of 2000.

....................................

NEW YORK (CNNfn) - Viacom Inc. and CBS Corp. announced a blockbuster $35.6 billion merger Tuesday, a move which is designed to bring the network of Dan Rather in touch with the MTV generation.



----------

From what you site we would be looking at $1.80 a share with a 100 % premium. Homer you never answered my question. If you do not own shares why so much time on the SDARS issue?

Quote:

---

Originally Posted by hartleib1

From what you site we would be looking at $1.80 a share with a 100 % premium.

---

However, you're running with the assumption that Karmazin has plans to sell or take the company private right now -- but that is not the case, right now. If a year from now (or so) the company has positive cash flow, positive EBITDA earnings and taken care of the debt refinancing for 2009 -- and Karmazin wants to sell the company... then it is my opinion that Sirius would not be at $1 and probably would be closer to $3. A 100% premium from there would be $6 and a very fair merger price, as that would put the EV up over $22 billion.

I caution you again if you are basing any opinion you have on a conversation you had with a reporter. I've worked in the media for nearly 20 years and know a lot of reporters -- you are making a big mistake by forming opinions based on unpublished, private conversations you've had.

Be that as it may, I am not going to sit here and speculate over what Karmazin will or won't do -- based on a supposed conversation you had with a reporter... because A) I don't trust you (you are a party in a lawsuit against the person we are discussing, which means your claims could be biased -- and you may leave out facts that are pertinent); because B) I don't trust your ability to draw acurrate conclusions, as I have discovered on more than one occasion your conclusion turned out to be completely inaccurrate; and because C) I don't trust reporters -- as reporters are notoriously just looking for the bigger story and quite often leave out pertinent info to any story... their conclusions can be (and often are) subjective... especially in private conversations.

As I've said now for the 3rd time, come back with proof that Karmazin wants to take the company private and F- the shareholders. You said he has a history of doing it, however I proved above that he only took his company private one time in the mid 1980's.

Quote:

---

Originally Posted by hartleib1

Homer you never answered my question. If you do not own shares why so much time on the SDARS issue?

---

Hartlieb, no disrespect was taken -- however my holdings disclosure, quite frankly, is none of your business. What I do with my time and how I spend it, is my business. I'm not a public person openly suing the company -- you are. I am just an annonymous message board participant, with a cursory interest in where the industry goes post merger. I'm not writing articles or blogs or hosting websites - and not making claims. I'm just a nobody with an opinion, generally responding to the claims of others. Buyer beware.

However, you are the one making claims (that IMHO, can not be substantiated in this case). I submit to you -- that you are suing this company and management while participating on message boards, posting subjective claims and actively challenging the opinions of others on several boards. You claim to be looking out for the shareholder -- yet your participation on these boards makes these claims a conflict of interest, IMHO. Howso? Because your opinion is biased. And your claims are biased.


P.S. - FWIW, I have voluntarily made my disclosure known on several boards in the past. Don't continue to make assumptions that you cannot prove.



-----------

Homer maybe you missed the story




Sirius XM Sends Signals of Change
CEO Karmazin Seeks Revamped Financing and Subscriber Options for Satellite Radio

By SARAH MCBRIDE
September 15, 2008; Page B1

With satellite radio's growth slowing and Wall Street rattled, Sirius XM Radio Inc. Chief Executive Mel Karmazin last week joked at an investor conference about how difficult it is to refinance some of the company's debt on reasonable terms. "Am I going to lend the company the money?" Mr. Karmazin asked. "I hope not. I hope we don't get to that."



Bloomberg News/Landov

CEO Mel Karmazin must shore up investor confidence.

Sirius XM shareholders weren't in the mood for wisecracks. Since the merger of Sirius Satellite Radio Inc. and XM Satellite Radio Holdings Inc. in late July, the company's stock has fallen about 40%, and now trades at less than a dollar. The downward trajectory accelerated last week after the company issued subscriber forecasts that fell below analysts' expectations and failed to reassure investors about looming debt payments.

In an interview, Mr. Karmazin conceded that his comments about the company's debt were flippant. "I wish I didn't say it," he said. "I tend to be candid. I said something off-handed. I wish it was as simple as that." Ultimately, he says there has been "a tremendous overselling of the stock" and that his company "is heading toward making a bunch of money in the future."

The merger of Sirius and XM was supposed to build confidence in satellite radio, in which subscribers pay a monthly fee for programming that is delivered through special receivers. But already, the normally cocksure Mr. Karmazin is on the defensive about satellite radio's prospects.

The months ahead will be a crucial proving ground. Sirius XM hopes to regain traction with consumers during the holiday season with its first programming packages and radio receivers that combine the Sirius and XM services. As an enticement to consumers who tried satellite radio but didn't stick with it, Mr. Karmazin has considered a plan to reactivate the radios of lapsed subscribers and give them a small selection of programming free of charge.

Meanwhile, Mr. Karmazin's focus is to shore up investor confidence by refinancing $300 million in convertible bonds that come due in February, replacing them with bank debt. Last week, he told investors that he had already begun a series of meetings with banks. "They didn't want to hear that we're having discussions," Mr. Karmazin said. "They wanted it done." While the refinancing is a priority, Mr. Karmazin says he wants to arrange it at favorable terms; the last time he renegotiated debt in a hurry -- in July, the day before the merger closed -- the stock price dropped 16%. On the consumer front, the company is currently negotiating with big retailers like Best Buy and Circuit City to ensure top-notch placement and promotion for its product over the key holiday sales season. The retail market has been dead for well over a year, Mr. Karmazin said, because of confusion over the Sirius-XM merger.

The company will soon introduce radios that allow consumers more flexibility in the programming, including a 50-channel plan that costs $6.99 a month. Sometime next year, radios that can play the entire lineup from both Sirius and XM will hit the market.

Starting next month, even those who don't upgrade their radios will be able to pay an extra $4 a month and get a few "best of" channels from the other company's service. For example, a current XM subscriber will be able to get Howard Stern and Martha Stewart, now exclusively on Sirius.

One potential use for inactive radios: zapping a limited selection of programming to them. "That would be a very efficient use," says Mr. Karmazin, adding the company has considered the move but currently doesn't have plans to implement it.

Given Sirius XM's low stock price, Mr. Karmazin said he would love to take the company private. But given the state of the credit markets, "How do you find [the money] today?" If the company were generating positive cash flow, which he expects it to do for the full year in 2009, privatization would become much more feasible, he says.Talk-show host Howard Stern's five-year, $500 million pay package, announced in 2004, included 34.4 million shares payable to him and his agent, Don Buchwald. Then, the shares were worth about $110 million; by the time he joined the company in 2006, they were worth more than $220 million because of the stock's sharp rise. Today, those shares would be worth $32.6 million. Mr. Karmazin declined to comment on Mr. Stern's current holdings; Mr. Buchwald wasn't available for comment.

Quote:

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Originally Posted by hartleib1

Homer maybe you missed the story.

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Hartlieb, maybe you missed that I acknowledged that comment made to Sarah in one of my first posts in this thread, on this topic:

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Quote:

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http://siriusbuzz.com/forum/showpost...7&postcount=24

P.S. - There is not one shred of evidence to support a claim that he is attempting to "steal" the company from the shareholders. That was merely a response to a question asked by a reporter, in which he even said he wasn't going to do it. If you're calling him a liar -- then fine. But watch your emotions... you're going to (once again) see things that just aren't there. I point out the headline to this thread that YOU started:

"Mel wants to F his shareholders buy stealing the combined co. from you."

Prove it...

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Him responding to a question asked by a reporter by saying what he said, does not mean that Karmazin is trying to F his shareholders. That is a claim made by you. I asked you to prove the headline in your thread here -- and you have not done so other than to quote Sarah's article and to say he's done it in the past -- neither of which is true and neither of which proves your headline. You then say that "Sarah told you" -- to which I don't believe you... because YOU hear what YOU want to hear because YOU are suing the company.

I say again, PROVE that he wants to F the shareholders...

And BTW as I said in my previous post, taking the company private after 2009 and if they met the metrics he noted in his comment to Sarah -- do you really believe that Sirius will only be worth $1?

Assumptions and emotions (both good and bad) -- that is a BAD combination for this stock... you gotta learn to disconnect, man...


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And here's another post, you must have not read:

http://siriusbuzz.com/forum/showpost...5&postcount=29

Remember, I discussed Sarah's article and not fully trusting what you read, for many reasons...

A) The reporter heard wrong or quoted wrong or didn't quite follow what the person speaking meant (happens more often than you think -- it just happened to me last month for an article I was interviewed for. It happens especially in this day and age where reporters aren't as dilligent as they used to be)

B) The person being interviewed spoke wrong (happens quite often too)

AND THE GRAND DADDY OF THEM ALL...

C) The quote was taken out of context to make a better story (don't let the facts get in the way of a good story)


Keeping the above in mind... you want to compound Karmazin's statement into one that says that he wants to "F the shareholders"?


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