XM Radio 2009 Annual Report Download - page 18

transactions and relationships between each director or members of his immediate family and SIRIUS XM,
other directors, members of our senior management and our affiliates.
As a result of this review, the board determined that all of our directors and nominees are independent of
the company and its management under the standards set forth in our Guidelines, with the exception of Mel
Karmazin, our Chief Executive Officer, and John C. Malone, Gregory B. Maffei and David J.A. Flowers, each
of whom is an employee of Liberty Media Corporation. Chester A. Huber, Jr. and John W. Mendel, who are or
have been employees of General Motors and American Honda, respectively, have indicated that they do not
wish to stand for reelection to the board of directors.
The board has also determined that all of the members of the Audit Committee are financially literate and
meet the independence requirements mandated by the applicable NASDAQ listing standards, Section 10A(m)(3)
of the Securities Exchange Act of 1934 and our Guidelines. The board has determined that all of the members
of the Compensation Committee meet the independence requirements mandated by the applicable NASDAQ
listing standards, the rules of the SEC and the Internal Revenue Service applicable to serving on the
Compensation Committee and our Guidelines. The board has determined that all of the members of the
Nominating and Corporate Governance Committee meet the independence requirements mandated by the
NASDAQ listing standards applicable to serving on the Nominating and Corporate Governance Committee and
our Guidelines.
Our independent directors meet regularly in executive sessions.
What is the Company’s approach toward oversight of risk management?
On behalf of the board of directors, the Audit Committee is responsible for oversight of our risk
management policies and procedures. We are exposed to a number of risks, including financial, strategic and
operational risks and risks relating to regulatory and legal compliance. The Audit Committee will discuss with
senior management our major risk exposures and the steps senior management has taken to monitor and
control such exposures. Our Chief Financial Officer is responsible for our risk management function and
works closely with our management to identify material risks. The Chief Financial Officer will meet with the
Audit Committee and our Chief Executive Officer regularly to discuss the risks facing us, highlighting any
new risks that may have arisen since they last met. The Audit Committee will also report to the board of
directors to apprise them of their discussions with the Chief Financial Officer regarding our risk management
efforts. Finally, the Chief Financial Officer will report directly to the board of directors at least annually to
apprise them directly of our risk management efforts.
What are our policies and procedures for related party transactions?
We have adopted a written policy and written procedures for the review, approval and monitoring of
transactions involving the company and “related persons.” For the purposes of the policy, “related persons”
include executive officers, directors and director nominees or their immediate family members, or stockholders
owning five percent or greater of our common stock.
Our related person transaction policy requires:
• that any transaction in which a related person has a material direct or indirect interest and which
exceeds $120,000, such transaction referred to as a “related person” transaction, and any material
amendment or modification to a related person transaction, be reviewed and approved or ratified by a
committee of the board composed solely of independent directors who are disinterested or by the
disinterested members of the board; and
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