XM Radio 2009 Annual Report Download - page 186

The Series B Preferred Stock is convertible into shares of our common stock at the rate of 206.9581409 shares
of common stock for each share of Series B Preferred Stock, representing approximately 40% of our outstanding
shares of common stock (after giving effect to such conversion). As holder of the Series B Preferred Stock, Liberty
Radio LLC is entitled to a number of votes equal to the number of shares of our common stock into which each such
Series B Preferred Stock share is convertible. Liberty Radio LLC will also receive dividends and distributions
ratably with our common stock, on an as-converted basis. With respect to dividend rights, the Series B Preferred
Stock ranks evenly with our common stock, the Series A Preferred Stock, and each other class or series of our equity
securities not expressly provided as ranking senior to the Series B Preferred Stock. With respect to liquidation
rights, the Series B Preferred Stock ranks evenly with each other class or series of our equity securities not expressly
provided as ranking senior to the Series B Preferred Stock, and will rank senior to our common stock and the
Series A Preferred Stock.
In 2009, we accounted for the issuance of Series B Preferred Stock by recording a $227,716 increase to
additional paid-in capital for the amount of allocated proceeds received and an additional $186,188 increase to paid-
in capital for the beneficial conversion feature, which was recognized as a charge to retained earnings.
In 2009, our board of directors created and reserved for issuance in accordance with the Rights Plan (as
described below) 9,000 shares of the Series C Junior Preferred Stock. The shares of Series C Junior Preferred Stock
are not redeemable and rank, with respect to the payment of dividends and the distribution of assets, junior to all
other series of our preferred stock, unless the terms of such series shall so provide.
Warrants
We have issued warrants to purchase shares of common stock in connection with distribution and program-
ming agreements, satellite purchase agreements and certain debt issuances. As of December 31, 2009, approx-
imately 47,271,000 warrants to acquire approximately 61,678,000 shares of common stock with an average exercise
price of $3.04 per share were outstanding. Warrants vest over time or upon the achievement of milestones and expire
at various times through 2015. We recognized aggregate warrant related expense of $2,522, $1,865 and $10,707 for
the years ended December 31, 2009, 2008 and 2007, respectively.
Average
Exercise
Price Expiration Date 2009 2008
Number of
Warrants
Outstanding
December 31,
NFL ........................ $ 2.50 March 2008 — March 2015 16,718 16,718
Penske Companies .............. 2.39 July 2009 — 2,921
DaimlerChrysler AG ............ 1.04 May 2012 16,500 16,500
RadioShack ................... 5.00 December 2010 4,000 6,000
Ford ........................ 3.00 October 2012 4,000 4,000
Warrants associated with XM
Holdings Debt ............... 0.66
December 2009
—44
Warrants associated with XM
Holdings Debt ............... 8.76
March 2010
325 325
Space Systems/Loral ............ 7.05 December 2011 1,840 1,840
Other distributors and programming
providers ................... 3.00
June 2014
1,788 1,788
Other ........................ 15.00 December 2010 — April 2011 2,100 4,531
Total ........................ $ 3.04 47,271 54,667
F-32
SIRIUS XM RADIO INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)