XM Radio 2008 Annual Report Download - page 106

The loans under the Second-Lien Credit Agreement are guaranteed by XM Holdings and each of the subsidiary
guarantors named therein. The loan is secured by a second lien on substantially all the assets of XM Holdings, XM
and certain subsidiaries named therein. The affirmative covenants, negative covenants and event of default
provisions contained in the Second-Lien Credit Agreement are substantially similar to those contained in the
First-Lien Credit Agreement (as defined below).
Amendment and Restatement of Existing XM Bank Facilities. On March 6, 2009, XM amended and restated
(i) the $100,000 Credit Agreement, dated as of June 26, 2008, among XM, XM Holdings, the lenders named therein
and UBS AG, as administrative agent (the “UBS Term Loan”) and (ii) the $250,000 Credit Agreement, dated as of
May 5, 2006, among XM, XM Holdings, the lenders named therein and JPMorgan Chase Bank, N.A., as
administrative agent (the “JPM Revolver” and, together with the UBS Term Loan, the “Previous Facilities”).
The Previous Facilities have been combined as term loans into the Amended and Restated Credit Agreement, dated
as of March 6, 2009, among XM, XM Holdings, the lenders named therein and JPMorgan Chase Bank, N.A., as
administrative agent (the “First-Lien Credit Agreement”), and Liberty Media LLC (the “Purchaser”) has purchased
$100,000 aggregate principal amount of such loans from the lenders. XM paid a restructuring fee of 2% to the
existing lenders under the Previous Facilities.
Loans under the First-Lien Credit Agreement held by existing lenders (the “Tranche A” and the “Tranche B”
term loans) will mature on May 5, 2010 and the remaining loans purchased by Liberty (the “Tranche C” term loans)
will mature on May 5, 2011. The Tranche A and the Tranche B term loans are subject to scheduled quarterly
amortization payments of $25,000 starting on March 31, 2009. The Tranche C term loans are subject to a partial
amortization of $25,000 on March 31, 2010, with all remaining amounts due on the final maturity date. Pursuant to
these maturities and the scheduled amortization payments, of the outstanding principal amount, $100,000 of the
$350,000 is due in 2009; $175,000 is due in 2010; and $75,000 is due in 2011. The loans will bear interest at rates
ranging from prime plus 11% to LIBOR (subject to a 3% floor) plus 12%.
The loans under the First-Lien Credit Agreement are guaranteed by XM Holdings and each of the subsidiary
guarantors named therein. The loans are secured by a first lien on substantially all of the assets of XM Holdings, XM
and certain subsidiaries named therein. The affirmative covenants, negative covenants and event of default
provisions contained in the First-Lien Credit Agreement are substantially similar to those contained in the Previous
Facilities, except that: (i) XM must maintain cash reserves of $75 million (without taking into account any proceeds
from the Second-Lien Credit Agreement (as defined above)), (ii) we must maintain cash reserves of $35 million,
(iii) XM Holdings and XM must maintain certain EBITDA levels set forth therein and (iv) an event of default shall
occur upon the acceleration of any our material indebtedness or in the event of our voluntary or involuntary
bankruptcy.
Issuance of the Preferred Stock. On March 6, 2009, we issued 12,500,000 shares of our preferred stock in
consideration for the investments described herein. The rights, preferences and privileges of the preferred stock are
described in the applicable Certificate of Designations. A summary of the terms of each Certificate of Designations
is described above. The foregoing description of the Certificates of Designations does not purport to be a complete
description of all of the terms of such Certificate of Designations and is qualified in its entirety by reference to the
Certificate of Designations for the preferred, copies of which are filed as Exhibits 3.1 and 3.2 to the Current Report
on Form 8-K dated March 6, 2009 filed with the Securities and Exchange Commission, and each Certificate of
Designations is incorporated herein by reference.
9.75% Senior Supplemental Indenture
On March 6, 2009, XM executed and delivered a Third Supplemental Indenture (the “XM 9.75% Notes
Supplemental Indenture”), dated as of March 6, 2009, by and among XM, XM Holdings, XM Equipment Leasing
LLC, XM Radio Inc. and The Bank of New York Mellon, as trustee, which supplements the indenture, dated as of
May 1, 2006, among XM, XM Holdings, XM Equipment Leasing LLC and the trustee with respect to XM’s
9.75% Senior Notes due 2014 (the “9.75% Notes”).
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SIRIUS XM RADIO INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)