XM Radio 2009 Annual Report Download - page 192

(15) Commitments and Contingencies
The following table summarizes our expected contractual cash commitments as of December 31, 2009:
2010 2011 2012 2013 2014 Thereafter Total
Long-term debt obligations.... $ 513,882 $349,080 $239,402 $1,304,250 $555,260 $257,000 $3,218,874
Cash interest payments ....... 263,358 249,642 234,037 194,849 63,814 25,058 1,030,758
Satellite and transmission ..... 182,443 58,460 2,359 2,370 10,856 11,327 267,815
Programming and content..... 253,471 143,187 123,925 32,478 14,350 — 567,411
Marketing and distribution .... 68,565 25,048 18,559 6,950 4,500 — 123,622
Satellite incentive payments . . . 7,384 8,851 10,505 11,099 10,807 63,535 112,181
Operating lease obligations.... 38,465 23,614 19,430 15,612 9,877 5,751 112,749
Other .................... 31,496 6,503 1,515 — — — 39,514
Total .................... $1,359,064 $864,385 $649,732 $1,567,608 $669,464 $362,671 $5,472,924
Long-term debt obligations. Long-term debt obligations include principal payments on outstanding debt.
Cash interest payments. Cash interest payments include interest due on outstanding debt through maturity.
Satellite and transmission. We have entered into agreements with third parties to operate and maintain the
off-site satellite telemetry, tracking and control facilities and certain components of our terrestrial repeater
networks. We have also entered into various agreements to design and construct satellites for use in our systems
and to launch those satellites.
SIRIUS has an agreement with Space Systems/Loral to design and construct a sixth satellite. In January 2008,
SIRIUS entered into an agreement with International Launch Services (“ILS”) to secure a satellite launch on a
Proton rocket. We expect to launch this sixth SIRIUS satellite in the fourth quarter of 2011.
Space Systems/Loral has constructed a fifth satellite, XM-5, for use in the XM system. In October 2009, we
entered into an agreement with ILS to secure a satellite launch for XM-5 on a Proton rocket. We expect to launch
XM-5 in the third quarter of 2010.
Programming and content. We have entered into various programming agreements. Under the terms of these
agreements, we are obligated to provide payments to other entities that may include fixed payments, advertising
commitments and revenue sharing arrangements.
Marketing and distribution. We have entered into various marketing, sponsorship and distribution agree-
ments to promote our brand and are obligated to make payments to sponsors, retailers, automakers and radio
manufacturers under these agreements. Certain programming and content agreements also require us to purchase
advertising on properties owned or controlled by the licensors. We also reimburse automakers for certain
engineering and development costs associated with the incorporation of satellite radios into vehicles they
manufacture. In addition, in the event certain new products are not shipped by a distributor to its customers
within 90 days of the distributor’s receipt of goods, we have agreed to purchase and take title to the product.
Satellite incentive payments. Boeing Satellite Systems International, Inc., the manufacturer of XM’s four in-
orbit satellites, may be entitled to future in-orbit performance payments with respect to two of XM’s four satellites.
As of December 31, 2009, we have accrued $28,723 related to contingent in-orbit performance payments for XM-3
and XM-4 based on expected operating performance over their fifteen year design life. Boeing may also be entitled
to an additional $10,000 if XM-4 continues to operate above baseline specifications during the five years beyond the
satellite’s fifteen-year design life.
Operating lease obligations. We have entered into cancelable and non-cancelable operating leases for office
space, equipment and terrestrial repeaters. These leases provide for minimum lease payments, additional operating
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SIRIUS XM RADIO INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)