Future subscriber revenue will be dependent upon, among other things, the growth of our subscriber base, promotions, mail-in rebates offered to subscribers and corresponding take-rates, plan mix, subscription prices and the identification of additional revenue streams from subscribers.
The increase in ARPU to $10.80 for the three months ended March 31, 2006 from $10.72 for the three months ended March 31, 2005 was primarily attributable to the improvement in our Hertz program, the effects of the timing of the commencement of revenue recognition for prepaid subscriptions and increased advertising revenue, offset by the impact of mail-in rebates and plan mix.
We expect equipment revenue to increase in the future as we continue to introduce new products and as sales through our direct to consumer distribution channel grow.
Future increases in satellite and transmission expenses will primarily be attributable to the addition of new terrestrial repeaters and maintenance costs of existing terrestrial repeaters. We expect to deploy a significant number of additional terrestrial repeaters in 2006. Such expenses may also increase in future periods if we decide to reinstate our in-orbit satellite insurance or launch new satellites.
Our programming and content expenses will increase as we continue to develop and enhance our channels. Beginning February 2007, our agreement with NASCAR will increase our programming and content expenses. In
addition, we expect broadcast royalties to increase as our subscriber base grows. We regularly evaluate programming opportunities and may choose to acquire and develop new content or renew current programming agreements in the future at substantial cost.
Customer Service and Billing. Customer service and billing expenses increased $6,349 to $15,841 for the three months ended March 31, 2006 from $9,492 for the three months ended March 31, 2005. The increase was primarily due to increased customer service representative costs and telecommunication charges as a result of the expansion and growth of our call centers to accommodate our subscriber base and increased transaction fees due to the addition of new subscribers. Customer service and billing expenses increased 67% compared with an increase in our end of period subscribers of 181% as of March 31, 2006 compared with March 31, 2005. Customer service and billing expenses per average subscriber per month declined 42% to $1.40 for the first quarter of 2006 compared with $2.40 for the first quarter of 2005.
We expect our customer care and billing expenses to increase and our costs per subscriber to decrease on an annual basis as our subscriber base grows.
Cost of Equipment. Cost of equipment increased $2,489 to $3,465 for the three months ended March 31, 2006 from $976 for the three months ended March 31, 2005. The increase was primarily attributable to higher sales through our direct to consumer distribution channel.
We expect cost of equipment to increase in the future as we introduce new products and as sales through our direct to consumer distribution channel grow.
Sales and Marketing. Sales and marketing expenses increased $4,174 to $39,296 for the three months ended March 31, 2006 from $35,122 for the three months ended March 31, 2005. The increase was attributable to higher distribution costs primarily as a result of increased OEM revenue share, market development funds and retail residuals. Compensation related costs also increased as a result of additions to headcount to support our growth. Such increases were offset by decreased advertising, media and production costs primarily for trade shows and events and for the expiration of certain sponsorships in 2005.
We expect sales and marketing expenses to increase as we continue to build brand awareness through national advertising and promotional activities and expand the distribution of SIRIUS radios. Beginning in 2007, our agreement with NASCAR will increase our sponsorship costs included in sales and marketing expense.
Subscriber Acquisition Costs. Subscriber acquisition costs increased $42,051 to $109,144 for the three months ended March 31, 2006 from $67,093 for the three months ended March 31, 2005, an increase of 63%. Over the same period, gross subscriber additions increased 171% from 354,708 for the three months ended March 31, 2005 to 960,610 for the three months ended March 31, 2006. The increase in subscriber acquisition costs was attributable to subsidies for higher shipments of SIRIUS radios and chip sets to accommodate the growth of our subscriber base and increases in commissions resulting from the increase in gross subscriber additions, offset by reductions in average subsidy rates as we continued to reduce manufacturing and chip set costs.
Subscriber acquisition costs per gross subscriber addition were $113 and $190 for the three months ended March 31, 2006 and 2005, respectively. The decline was primarily attributable to the reduction in average subsidy rates as we continued to reduce manufacturing and chip set costs.
We expect total subscriber acquisition costs to increase in the future as our gross subscriber additions increase and we continue to offer subsidies, commissions and other incentives to acquire subscribers. However, we anticipate that, on a per gross subscriber addition basis, the costs of certain subsidized components of SIRIUS radios will continue to decrease in the future. If competitive forces require us to increase hardware subsidies or promotions, subscriber acquisition costs per gross subscriber addition could increase. Our subscriber acquisition costs per gross subscriber addition are generally higher in the first three quarters of our fiscal year and decline in the fourth quarter as we experience higher activation rates.
General and Administrative. General and administrative expenses increased $4,312 to $19,144 for the three months ended March 31, 2006 from $14,832 for the three months ended March 31, 2005. The increase was primarily a result of additional personnel-related costs and operating costs to support the growth of our business and bad debt expense.
24
We expect our general and administrative expenses to increase in future periods for personnel-related and facility costs to support our growth.
Engineering, Design and Development. Engineering, design and development expenses increased $1,017 to $12,679 for the three months ended March 31, 2006 from $11,662 for the three months ended March 31, 2005. The increase was primarily attributable to additional personnel-related costs to support research and development efforts and costs associated with OEM tooling and manufacturing upgrades for factory installations of SIRIUS radios.
We expect engineering, design and development expenses to decrease in 2007, as we anticipate incorporating SIRIUS radios and accessories in a significant number of vehicle models for the year ended 2006.
Equity Granted to Third Parties and Employees. Equity granted to third parties and employees expense for warrants decreased $7,125 to $14,371 for the three months ended March 31, 2006 from $21,496 for the three months ended March 31, 2005. This decrease was primarily attributable to the timing of our partners achieving production and other milestones and changes in the fair value of such awards during the first quarter of 2006 as compared with the first quarter of 2005.
Equity granted to third parties and employees expense for stock options, restricted stock, restricted stock units and other stock-based awards increased $253,005 to $270,215 for the three months ended March 31, 2006 from $17,210 for the three months ended March 31, 2005. The increase was primarily a result of $224,813 of expense for granting 34,375,000 shares of our common stock to Howard Stern and his agent in January 2006. Excluding the charge for these shares, equity granted to third parties expense increased $28,192 to $45,402 for the three months ended March 31, 2006. The increase was primarily attributable to the adoption of SFAS No. 123R and expense associated with common stock expected to be earned upon the satisfaction of performance targets.
Future expense associated with equity granted to third parties and employees is contingent upon a number of factors, including the number of stock-based awards granted, the price of our common stock, assumptions used in estimating the fair value of stock-based awards, estimates for forfeitures, vesting provisions and the timing as to when certain performance criteria are met, and could materially change.
Other Income (Expense)
Interest and Investment Income. Interest and investment income increased $5,450 to $9,937 for the three months ended March 31, 2006 from $4,487 for the three months ended March 31, 2005. The increase was attributable to higher interest rates and the purchase of auction rate securities and commercial paper using the proceeds from the issuance of our 9 5/8% Senior Notes due 2013 in August 2005.
Interest Expense. Interest expense increased $9,799 to $17,124 for the three months ended March 31, 2006 from $7,325 for the three months ended March 31, 2005. The increase was primarily the result of interest expense for our 9 5/8% Senior Notes due 2013 issued in August 2005, offset by a decrease as a result of the redemption of our 15% Senior Secured Discount Notes due 2007 and our 14½% Senior Secured Notes due 2009 in September 2005.
Income (Expense) from Affiliate. For the three months ended March 31, 2006, we recorded $4,445 for our share of SIRIUS Canada Inc.’s net loss.
Income Taxes
Income Tax Expense. We recorded income tax expense of $753 and $560 for the three months ended March 31, 2006 and 2005, respectively. This expense represents the recognition of a deferred tax liability related to the difference in accounting for our FCC license, which is amortized over 15 years for tax purposes but not amortized for book purposes in accordance with U.S. generally accepted accounting principles.
Liquidity and Capital Resources
Cash Flows for the Three Months Ended March 31, 2006 Compared with the Three Months Ended March 31, 2005
As of March 31, 2006, we had $630,831 in cash and cash equivalents compared with $629,376 as of March 31, 2005, an increase of $1,455. Cash and cash equivalents decreased $131,176 during the three months ended March 31,
25
2006. The decrease was a result of net cash used in operating activities of $159,341, offset by net cash provided by financing activities and investing activities of $1,459 and $26,706, respectively.
Net Cash Used in Operating Activities. The following table contains a breakdown of our net loss adjusted for non-cash items and our changes in operating assets and liabilities:
| | | | | | | | | | |
| | For the Three Months
Ended March 31, | | | | |
| |
| | | | |
| | 2006 | | 2005 | | Variance | |
| |
| |
| |
| |
Net loss adjusted for non-cash items: | | | | | | | | | | |
Net loss | | $ | (458,544 | ) | $ | (193,612 | ) | $ | (264,932 | ) |
Depreciation | | | 24,933 | | | 24,501 | | | 432 | |
Non-cash interest expense | | | 761 | | | 762 | | | (1 | ) |
Provision for doubtful accounts | | | 1,777 | | | 1,400 | | | 377 | |
Non-cash loss from affiliate | | | 2,276 | | | — | | | 2,276 | |
Loss on disposal of assets | | | 221 | | | 127 | | | 94 | |
Equity granted to third parties and employees | | | 284,586 | | | 38,706 | | | 245,880 | |
Deferred income taxes | | | 753 | | | 560 | | | 193 | |
| |
|
| |
|
| |
|
| |
Total net loss adjusted for non-cash items | | | (143,237 | ) | | (127,556 | ) | | (15,681 | ) |
| |
|
| |
|
| |
|
| |
Changes in operating assets and liabilities: | | | | | | | | | | |
Marketable securities | | | — | | | 16 | | | (16 | ) |
Accounts receivable | | | 9,952 | | | (340 | ) | | 10,292 | |
Inventory | | | (1,198 | ) | | 16 | | | (1,214 | ) |
Prepaid expenses and other current assets | | | (21,758 | ) | | (3,181 | ) | | (18,577 | ) |
Other long-term assets | | | 579 | | | (1,157 | ) | | 1,736 | |
Accounts payable and accrued expenses | | | (45,220 | ) | | (5,601 | ) | | (39,619 | ) |
Accrued interest | | | (10,460 | ) | | 2,736 | | | (13,196 | ) |
Deferred revenue | | | 44,458 | | | 19,423 | | | 25,035 | |
Other long-term liabilities | | | 7,543 | | | (1,524 | ) | | 9,067 | |
| |
|
| |
|
| |
|
| |
Total changes in operating assets and liabilities | | | (16,104 | ) | | 10,388 | | | (26,492 | ) |
| |
|
| |
|
| |
|
| |
Net cash used in operating activities | | $ | (159,341 | ) | $ | (117,168 | ) | $ | (42,173 | ) |
| |
|
| |
|
| |
|
| |
Net cash used in operating activities increased $42,173 to $159,341 for the three months ended March 31, 2006 from $117,168 for the three months ended March 31, 2005. Such increase was attributable to a $26,492 increase in the net outflow of cash from changes in operating assets and liabilities and an increase of $15,681 in the net loss adjusted for non-cash items, from $127,556 for the three months ended March 31, 2005 to $143,237 for the three months ended March 31, 2006.
The net outflow of cash from changes in operating assets and liabilities was primarily attributable to the ($39,619) change in accounts payable and accrued expenses to paydown accruals built up in the fourth quarter of 2005; the ($18,577) change in prepaid expenses and other current assets as a result of prepayments for programming agreements; and the ($13,196) change in accrued interest as a result of our first interest payment on our 9 5/8% Senior Notes due 2013. These net outflows of cash were offset in part by a $25,035 change in deferred revenue for subscribers electing annual and other prepaid subscription programs as we currently receive an average of approximately eight months of prepaid revenue per subscriber upon activation, and a $10,292 change in accounts receivable for the paydown of receivable balances generated for activations in the fourth quarter of 2005, which were paid in the first quarter of 2006.
The increase in the net loss adjusted for non-cash items was primarily a result of a 63%, or $42,051, increase in subscriber acquisition costs reflecting subsidies for higher shipments of SIRIUS radios and chip sets and increased commissions to support a 171% increase in gross subscriber additions, offset by reductions in average subsidy rates as we continued to reduce manufacturing and chip set costs. In addition, other operating expenses increased primarily to acquire content associated with new programming agreements. Such increases were more than offset by a 175%, or $73,277, increase in subscriber revenue.
Net Cash Provided by (Used in) Investing Activities. Net cash provided by investing activities was $26,706 for the three months ended March 31, 2006 compared with net cash used in investing activities of $8,332 for the three months ended March 31, 2005. The $35,038 increase was primarily a result of the sales of auction rate securities in
26
the first quarter of 2006. Capital expenditures were $5,496 for the three months ended March 31, 2006 compared with $6,888 for the three months ended March 31, 2005.
For the remainder of 2006, we will incur significant capital expenditures to secure a satellite launch vehicle and improve our terrestrial repeater network and broadcast and administrative infrastructure. These capital expenditures will support the resiliency of our operations and the growth we are experiencing as well as support the delivery of new revenue streams in the future through our video and telematics offerings.
Net Cash Provided by Financing Activities.Net cash provided by financing activities increased $474 to $1,459 for the three months ended March 31, 2006 from $985 for the three months ended March 31, 2005 due to additional proceeds received from the exercise of stock options.
Financings and Capital Requirements
We have financed our operations principally through the sale of debt and equity securities. In August 2005, we sold $500,000 in aggregate principal amount of our 9 5/8% Senior Notes due 2013 resulting in net proceeds of $493,005.
Future Liquidity and Capital Resource Requirements
Based upon our current plans, we believe that our cash, cash equivalents and marketable securities will be sufficient to cover our estimated funding needs through cash flow breakeven, the point at which our revenues are sufficient to fund expected operating expenses, capital expenditures, working capital requirements, interest and principal payments and taxes. We expect to generate positive free cash flow for the full year 2007, and our first quarter of positive free cash flow could be reached as early as the fourth quarter of 2006. Our financial projections are based on assumptions, which we believe are reasonable but contain significant uncertainties.
Our business is in its early stages, and we regularly evaluate our plans and strategy. These evaluations often result in changes to our plans and strategy, some of which may be material and significantly change our cash requirements or cause us to achieve cash flow breakeven at a later date. These changes in our plans or strategy may include: the acquisition of unique or compelling programming; the introduction of new features or services; significant new or enhanced distribution arrangements; investments in infrastructure, such as satellites, equipment or radio spectrum; and acquisitions of third parties that own programming, distribution, infrastructure, assets, or any combination of the foregoing.
To fund incremental cash requirements, or as market opportunities arise, we may choose to raise additional funds through the sale of additional debt securities, equity securities or a combination of debt and equity securities. The incurrence of additional indebtedness would result in increased fiscal obligations and could contain restrictive covenants. The sale of additional equity or convertible debt securities would result in dilution to our stockholders. These additional sources of funds may not be available or, if available, may not be available on terms favorable to us.
2003 Long-Term Stock Incentive Plan
In January 2003, our board of directors adopted the Sirius Satellite Radio 2003 Long-Term Stock Incentive Plan (the “2003 Plan”), and on March 4, 2003 our stockholders approved this plan. On May 25, 2004, our stockholders approved an amendment to the 2003 Plan to include members of our board of directors as eligible participants. Employees, consultants and members of our board of directors are eligible to receive awards under the 2003 Plan. The 2003 Plan provides for the grant of stock options, restricted stock, restricted stock units and other stock-based awards that the compensation committee of our board of directors may deem appropriate.
Vesting and other terms of stock-based awards are set forth in the agreements with the individuals receiving the awards. Stock-based awards granted under the 2003 Plan are generally subject to a vesting requirement that includes one or all of the following: (1) over time, generally three to five years from the date of grant; (2) on a specific date in future periods, with acceleration to earlier periods if performance criteria are satisfied; or (3) as certain performance targets set at the time of grant are achieved. Stock-based awards generally expire ten years from date of grant. Each restricted stock unit entitles the holder to receive one share of our common stock upon vesting.
As of March 31, 2006, approximately 95,692,000 stock options, shares of restricted stock and restricted stock units were outstanding. As of March 31, 2006, approximately 86,477,000 shares of our common stock were available
27
for grant under the 2003 Plan. During the three months ended March 31, 2006, employees exercised 971,702 stock options at exercise prices ranging from $0.47 to $3.91 per share, resulting in proceeds to us of $1,233. The exercise of the remaining outstanding, vested options could result in an inflow of cash in future periods.
Contractual Cash Commitments
We have entered into various contracts that have resulted in significant cash obligations in future periods. These cash obligations could vary in future periods if we change our business plan or strategy, which could include significant additions to our programming, infrastructure or distribution channel. The following table summarizes our expected contractual cash commitments as of March 31, 2006:
| | | | | | | | | | | | | | | | | | | | | | |
| | Remaining
2006 | | 2007 | | 2008 | | 2009 | | 2010 | | Thereafter | | Total | |
| |
|
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|
| |
|
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|
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|
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|
| |
|
| |
Long-term debt obligations | | $ | — | | $ | — | | $ | 52,185 | | $ | 301,744 | | $ | — | | $ | 730,000 | | $ | 1,083,929 | |
Cash interest payments | | | 37,190 | | | 65,078 | | | 64,165 | | | 59,606 | | | 55,600 | | | 152,878 | | | 434,517 | |
Lease obligations | | | 6,935 | | | 9,135 | | | 8,925 | | | 8,881 | | | 8,665 | | | 32,250 | | | 74,791 | |
Satellite and transmission | | | 35,185 | | | 2,484 | | | 2,484 | | | 2,484 | | | 5,491 | | | 8,337 | | | 56,465 | |
Programming and content | | | 111,249 | | | 116,870 | | | 123,111 | | | 145,864 | | | 148,384 | | | 66,196 | | | 711,674 | |
Customer service and billing | | | 2,550 | | | 3,138 | | | — | | | — | | | — | | | — | | | 5,688 | |
Marketing and distribution | | | 105,032 | | | 37,232 | | | 25,323 | | | 16,752 | | | 18,145 | | | 10,750 | | | 213,234 | |
Chip set development and production | | | 15,523 | | | 3,000 | | | — | | | — | | | — | | | — | | | 18,523 | |
Other | | | 9,096 | | | 406 | | | 177 | | | 11 | | | — | | | — | | | 9,690 | |
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
|
| |
Total contractual cash commitments | | $ | 322,760 | | $ | 237,343 | | $ | 276,370 | | $ | 535,342 | | $ | 236,285 | | $ | 1,000,411 | | $ | 2,608,511 | |
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Long-Term Debt Obligations. Long-term debt obligations include principal payments on our outstanding debt.
Cash Interest Payments. Cash interest payments include interest due on our outstanding debt through maturity.
Lease Obligations. We have entered into operating leases related to our studios, office space, terrestrial repeaters and equipment.
Satellite and Transmission.We have entered into agreements with third parties to operate and maintain certain components of our terrestrial repeater network. We have also entered into an agreement with a launch services provider to secure a satellite launch on a Proton rocket prior to the end of 2010.
Programming and Content.We have entered into agreements with licensors of programming and other content providers and, in certain instances, are obligated to pay license fees and guarantee minimum advertising revenue share. In addition, we have agreements with various rights organizations pursuant to which we pay royalties for public performances of music.
Customer Service and Billing.We have entered into agreements with third parties to provide billing and subscriber management services.
Marketing and Distribution.We have entered into various marketing, sponsorship and distribution agreements to promote our brand and are obligated to make payments to sponsors, retailers, automakers and radio manufacturers under these agreements. In addition, certain programming and content agreements 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 SIRIUS radios into vehicles they manufacture.
28
Chip Set Development and Production.We have entered into agreements with third parties to develop, produce and supply chip sets, and in certain instances to license intellectual property related to such chip sets. Certain of these agreements require that we purchase a minimum quantity of chip sets.
Other.We have entered into an agreement with Canadian Broadcasting Corporation and Standard Broadcasting Corporation to fund SIRIUS Canada. We have also entered into various agreements with third parties for general operating purposes. Amounts associated with SIRIUS Canada and these various other agreements are included in the commitments table.
In addition to the contractual cash commitments described above, we have entered into agreements with automakers, radio manufacturers and others that include per-radio, per-subscriber, per-show and other variable cost arrangements. These future costs are dependent upon many factors including our future subscriber growth and are difficult to anticipate; however, these costs may be substantial. We may enter into additional programming, distribution, marketing and other agreements that contain similar provisions.
Under the terms of a joint development agreement with XM Radio, the other holder of a FCC satellite radio license, each party is obligated to fund one half of the development cost for a unified standard for satellite radios. The costs related to the joint development agreement are being expensed as incurred to engineering, design and development expense. We are currently unable to determine the expenditures necessary to complete this process, but they may be significant.
We are required under the terms of certain agreements to provide letters of credit and deposit monies in escrow, which place restrictions on our cash and cash equivalents. As of March 31, 2006 and December 31, 2005, $108,315 and $107,615, respectively, were classified as restricted investments as a result of our reimbursement obligations under these letters of credit and escrow arrangements.
As of March 31, 2006, we have not entered into any off-balance sheet arrangements or transactions.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
As of March 31, 2006, we did not have any derivative financial instruments and we do not intend to use derivatives. We do not hold or issue any free-standing derivatives. We hold investments in marketable securities, which consist of certificates of deposit and auction rate securities. We classify our marketable securities as available-for-sale. These securities are consistent with the investment objectives contained within our investment policy. The basic objectives of our investment policy are the preservation of capital, maintaining sufficient liquidity to meet operating requirements and maximizing yield. Despite the underlying long-term maturity of auction rate securities, from the investor’s perspective, such securities are priced and subsequently traded as short-term investments because of the interest rate reset feature. Interest rates are reset through an auction process at predetermined periods of 28 or 35 days. Failed auctions rarely occur. As of March 31, 2006, we held approximately $84,200 in auction rate securities.
Our long-term debt includes fixed interest rates and the fair market value of the debt is sensitive to changes in interest rates. Under our current policies, we do not use interest rate derivative instruments to manage our exposure to interest rate fluctuations.
Item 4. Controls and Procedures
As of March 31, 2006, an evaluation was performed under the supervision and with the participation of our management, including Mel Karmazin, our Chief Executive Officer, and David J. Frear, our Executive Vice President and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on that evaluation, our management, including our Chief Executive Officer and our Chief Financial Officer, concluded that our disclosure controls and procedures were effective as of March 31, 2006. There have been no significant changes in our internal control over financial reporting or in other factors that could significantly affect our internal control over financial reporting subsequent to March 31, 2006.
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Part II
Other Information
Item 1. Legal Proceedings
There are no material changes to the legal proceedings disclosed on the Form 10-K filed for the year ended December 31, 2005.
Item 1A. Risk Factors
There are no material changes to the risk factors disclosed on the Form 10-K filed for the year ended December 31, 2005.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Not applicable.
Item 3. Defaults Upon Senior Securities
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders
Not applicable.
Item 5. Other Information
Not applicable.
Item 6. Exhibits
See Exhibit Index attached hereto.
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SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| | | |
| SIRIUS SATELLITE RADIO INC. |
| |
| By: | /s/ DAVID J. FREAR |
| |
|
| | David J. Frear
Executive Vice President and
Chief Financial Officer
(Principal Financial Officer and
Principal Accounting Officer) |
| | |
May 9, 2006 | | |
31
| | | |
EXHIBIT INDEX |
| | | |
Exhibit | | | | Description | |
| | | |
| |
3.1 | | — | Amended and Restated Certificate of Incorporation dated March 4, 2003 (incorporated by reference to Exhibit 3.1 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2002). |
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3.2 | | — | Amended and Restated By-Laws (incorporated by reference to Exhibit 3.2 to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2001). |
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4.1 | | — | Form of certificate for shares of Common Stock (incorporated by reference to Exhibit 4.3 to the Company’s Registration Statement on Form S-1 (File No. 33-74782) (the “S-1 Registration Statement”)). |
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4.2 | | — | Warrant Agreement, dated as of May 15, 1999, between the Company and United States Trust Company of New York, as warrant agent (incorporated by reference to Exhibit 4.4.4 to the Company’s Registration Statement on Form S-4 (File No. 333-82303)). |
| | | |
4.3 | | — | Indenture, dated as of September 29, 1999, between the Company and United States Trust Company of Texas, N.A., as trustee, relating to the Company’s 8¾% Convertible Subordinated Notes due 2009 (incorporated by reference to Exhibit 4.2 to the Company’s Current Report on Form 8-K filed on October 13, 1999). |
| | | |
4.4 | | — | First Supplemental Indenture, dated as of September 29, 1999, between the Company and United States Trust Company of Texas, N.A., as trustee, relating to the Company’s 8¾% Convertible Subordinated Notes due 2009 (incorporated by reference to Exhibit 4.01 to the Company’s Current Report on Form 8-K filed on October 1, 1999). |
| | | |
4.5 | | — | Second Supplemental Indenture, dated as of March 4, 2003, among the Company, The Bank of New York (as successor to United States Trust Company of Texas, N.A.), as resigning trustee, and HSBC Bank USA, as successor trustee, relating to the Company’s 8¾% Convertible Subordinated Notes due 2009 (incorporated by reference to Exhibit 4.16 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2002). |
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4.6 | | — | Third Supplemental Indenture, dated as of March 7, 2003, between the Company and HSBC Bank USA, as trustee, relating to the Company’s 8¾% Convertible Subordinated Notes due 2009 (incorporated by reference to Exhibit 4.17 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2002). |
| | | |
4.7 | | — | Form of 8¾% Convertible Subordinated Note due 2009 (incorporated by reference to Article VII of Exhibit 4.01 to the Company’s Current Report on Form 8-K filed on October 1, 1999). |
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4.8 | | — | Indenture, dated as of May 23, 2003, between the Company and The Bank of New York, as trustee (incorporated by reference to Exhibit 99.2 to the Company’s Current Report on Form 8-K dated May 30, 2003). |
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4.9 | | — | Supplemental Indenture, dated as of May 23, 2003, between the Company and The Bank of New York, as trustee, relating to the Company’s 3½% Convertible Notes due 2008 (incorporated by reference to Exhibit 99.3 to the Company’s Current Report on Form 8-K dated May 30, 2003). |
| | | |
4.10 | | — | Second Supplemental Indenture, dated as of February 20, 2004, between the Company and The Bank of New York, as trustee, relating to the Company’s 2½% Convertible Notes due 2009 (incorporated by reference to Exhibit 4.20 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2003). |
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4.11 | | — | Third Supplemental Indenture, dated as of October 13, 2004, between the Company and The Bank of New York, as trustee, relating to the Company’s 3¼% Convertible Notes due 2011 (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K dated October 13, 2004). |
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4.12 | | — | Indenture, dated as of August 9, 2005, between the Company and The Bank of New York, as trustee relating to the Company’s 9 5/8% Senior Notes due 2013 (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on August 12, 2005). |
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4.13 | | — | Common Stock Purchase Warrant granted by the Company to DaimlerChrysler AG dated October 4, 2005 (incorporated by reference to Exhibit 4.13 to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2005). |
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4.14 | | — | Common Stock Purchase Warrant granted by the Company to Ford Motor Company dated October 7, 2002 (incorporated by reference to Exhibit 4.16 to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2002). |
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Exhibit | | | | Description | |
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| |
4.15 | | — | Form of Media-Based Incentive Warrant dated February 3, 2004 issued by the Company to NFL Enterprises LLC (incorporated by reference to Exhibit 4.25 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2003). |
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4.16 | | — | Bounty-Based Incentive Warrant dated February 3, 2004 issued by the Company to NFL Enterprises LLC (incorporated by reference to Exhibit 4.26 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2003). |
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4.17 | | — | Amended and Restated Warrant Agreement, dated as of December 27, 2000, between the Company and United States Trust Company of New York, as warrant agent and escrow agent (incorporated by reference to Exhibit 4.27 to the Company’s Registration Statement on Form S-3 (File No. 333-65602)). |
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10.1.1 | | — | Lease Agreement, dated as of March 31, 1998, between Rock-McGraw, Inc. and the Company (incorporated by reference to Exhibit 10.1.2 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 1998). |
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10.1.2 | | — | Supplemental Indenture, dated as of March 22, 2000, between Rock-McGraw, Inc. and the Company (incorporated by reference to Exhibit 10.1.2 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2000). |
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*10.2 | | — | Employment Agreement dated November 18, 2004 between the Company and Mel Karmazin (incorporated by reference to Exhibit 10.2 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2004). |
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*10.3 | | — | Employment Agreement, dated as of June 3, 2003, between the Company and David J. Frear (incorporated by reference to Exhibit 10.7 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2003). |
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*10.4 | | — | First Amendment, dated as of August 10, 2005, to the Employment Agreement, dated as of June 3, 2003, between the Company and David Frear (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K dated August 12, 2005). |
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*10.5 | | — | Employment Agreement, dated as of May 5, 2004, between the Company and Scott A. Greenstein (incorporated by reference to Exhibit 10.4 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2004). |
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*10.6 | | — | First Amendment, dated as of August 8, 2005, to the Employment Agreement, dated as of May 5, 2004, between the Company and Scott Greenstein (filed herewith). |
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*10.7 | | — | Amended and Restated Employment Agreement, dated as of March 11, 2005, between the Company and James E. Meyer (incorporated by reference to Exhibit 10.5 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2004). |
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*10.8 | | — | First Amendment, dated February 2, 2006, to the Amended and Restated Employment Agreement, dated March 11, 2005, between the Company and James E. Meyer (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K dated February 1, 2006). |
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*10.9 | | — | Restricted Stock Unit Agreement, dated as of August 9, 2005, between the Company and James E. Meyer (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K dated August 12, 2005). |
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*10.10 | | — | Employment Agreement, dated as of November 8, 2004, between the Company and Patrick L. Donnelly (incorporated by reference to Exhibit 10.6 to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2004). |
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*10.11 | | — | CD Radio Inc. 401(k) Savings Plan (incorporated by reference to Exhibit 4.4 to the Company’s Registration Statement on Form S-8 (File No. 333-65473)). |
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*10.12 | | — | Amended and Restated Sirius Satellite Radio 2003 Long-Term Stock Incentive Plan (incorporated by reference to Exhibit 10.10 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2004). |
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Exhibit | | | Description | |
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*10.13 | | — | Form of Option Agreement, dated as of December 29, 1997, between the Company and each Optionee (incorporated by reference to Exhibit 10.16.2 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 1998). |
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†10.14 | | — | Joint Development Agreement, dated as of February 16, 2000, between the Company and XM Satellite Radio Inc. (incorporated by reference to Exhibit 10.28 to the Company’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2000). |
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31.1 | | — | Certificate of Mel Karmazin, Chief Executive Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith). |
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31.2 | | — | Certificate of David J. Frear, Executive Vice President and Chief Financial Officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith). |
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32.1 | | — | Certificate of Mel Karmazin, Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith). |
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32.2 | | — | Certificate of David J. Frear, Executive Vice President and Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (filed herewith). |
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* | This document has been identified as a management contract or compensatory plan or arrangement. |
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† | Portions of this exhibit have been omitted pursuant to Applications for Confidential treatment filed by the Company with the Securities and Exchange Commission. |
