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Technology Stocks : XM Satellite Radio Holdings Inc. (XMSR) -- Ignore unavailable to you. Want to Upgrade?

To: pcstel who wrote (391)	11/24/2002 4:45:03 PM
From: russwinter	Read Replies (1) \| Respond to of 3386

<Like Globalstar> I don't think XMSR's debt is really the primary issue here especially in comparison to the name you mentioned. Much smaller amounts involved, and much lower hurdles to cross to reach profitability. I just don't see the same animal. biz.yahoo.com biz.yahoo.com The tough part of this is that we are in a market that totally rejects real option theory or development plays, even sound ones. Still even though this is not risk adverse capital, new money financing XMSR likely is most focused on the execution (very good) and the viability of satellite radio (at minimum solid, and some (me) might say superlative). I've seen nothing at this point that disproves those focal points, nor am I seeing any blue sky whatsover in the valuation.

To: pcstel who wrote (391)	11/24/2002 5:00:39 PM
From: i-node	Respond to of 3386

Your view is well taken. But, I might point out that if GM executed the 200 million in exchange for debt instruments. They would probably own more of a debt free XM post petitiion vs. their position today. As would almost any of these current investors who stepped up with DIP Funding. The deal with GM to convert liability to secured debt only occurs IF XM gets the $200M from someone else. If they get the $200M from someone else, there will be no bankruptcy, and thus no DIP. The real question, to me at least, is whether this arrangement with GM leaves them with convertible debt or just some type of nonconvertible security. Aside from this, the other major stockholders aren't going to sit idly by and watch their investment go to zero while GM walks away with it all. I'm betting my money on XM getting $200M in borrowed funds, perhaps (but not necessarily) with a conversion option, and in addition, GM agrees to defer collection of its existing liability in exchange for converting it to secured, nonconvertible debt. This, effectively, eliminates the prospects of bankruptcy and the stock price will immediately bounce back nicely. I could see a rise to 4 or 5 right away, followed by a gradual climb as subs continue to rise. We could, until financing is secured, see a further decline, however. I'm planning on buying some more tomorrow, but if it dips substantially before the financing is secured, I'll try to buy more at that time. I think that only in most awfully managed situations do truly great products like this one just die. And the management of XM is, in my view, first rate. Besides, you can buy a lot of this stock for a little money these days...

To: pcstel who wrote (391)	11/24/2002 9:56:14 PM
From: Michael Young	Respond to of 3386

I don't believe the GLobalstar comparison is valid. It was abundantly clear to everyone within a few months after the service launched that there simply was very minimal demand for Globalstar service. There was no demand for ultra-expensive and clunky sat phones. No amount of additional funding would save that operation. On the other hand, XMSR has shown there is a strong early demand for the product. How big it eventually gets is unclear, but the early signs are at least encouraging. MIKE