XM Satellite Radio Holdings Inc – ‘8-K’ for 8/2/02

On:  Friday, 8/2/02, at 5:12pm ET   ·   For:  8/2/02   ·   Accession #:  928385-2-2648   ·   File #:  0-27441

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Current Report   —   Form 8-K
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 8-K         Current Report                                         6     27K 
 2: EX-99.1     Miscellaneous Exhibit                                 74    241K 
 3: EX-99.2     Miscellaneous Exhibit                                  2     12K 

8-K   —   Current Report
Document Table of Contents

8-K
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
 Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):       Commission File Number: 
       August 2, 2002                                  0-27441

XM SATELLITE RADIO HOLDINGS INC.
(Exact name of registrant as specified in its charter)

Delaware                                   54-1878819   
(State or other jurisdiction                        (IRS Employer           
of incorporation)                        Identification Number) 

1500 Eckington Place, N.E.
Washington, D.C. 20002
(Address of principal executive offices) (Zip Code) 

 Registrant's telephone number, including area code:
(202) 380-4000

 (Former name or former address, if changed since last report)

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XM SATELLITE RADIO HOLDINGS INC.

Item 5.  Other Events.                                                          

     On August 2, 2002, the Dividend Committee of the Board of Directors of XM
Satellite Radio Holdings Inc., a Delaware corporation (the "Company"), declared 
a dividend distribution of one right ("Right") for each outstanding share of the
Company's Class A common stock (the "Class A Common Stock"), Series A preferred 
stock and Series C preferred stock (on an as-converted basis) (collectively, the
"Eligible Stock"). The distribution is payable to stockholders of record on     
August 15, 2002. Each Right, when exercisable, entitles the registered holder to
purchase from the Company one-one thousandth of a share of Series D Junior      
Participating Preferred Stock ("Preferred Stock") at a price of $50.00 per      
one-one thousandth share (the "Purchase Price"), subject to adjustment. The     
description and terms of the Rights are set forth in a Rights Agreement (the    
"Rights Agreement") between the Company and Equiserve Trust Company, N.A., as   
Rights Agent (the "Rights Agent").                                              

   Initially, the Rights will be attached to all certificates representing
shares of Eligible Stock then outstanding, and no separate certificates         
evidencing the Rights will be distributed. The Rights will separate from the    
Eligible Stock and a distribution of Rights Certificates (as defined below) will
occur upon the earlier to occur of (i) 10 days following a public announcement  
that a person or group of affiliated or associated persons (an "Acquiring       
Person") has acquired, or obtained the right to acquire, beneficial ownership of
15% or more of the outstanding shares of Common Stock (the "Stock Acquisition   
Date") or (ii) 10 business days (or such later date as the Board of Directors of
the Company may determine) following the commencement of, or the first public   
announcement of the intention to commence, a tender offer or exchange offer the 
consummation of which would result in the beneficial ownership by a person of   
15% or more of the outstanding shares of Class A Common Stock (the earlier of   
such dates being called the "Distribution Date"). Due to their current ownership
position in excess of 15% of the Company's outstanding Class A Common Stock,    
under the Rights Agreement, each of General Motors Corporation and Hughes       
Electronics Corporation (and their respective affiliates and associates) shall  
not be considered an Acquiring Person, unless and until such date that it       
acquires an additional 2% of the Company's outstanding Class A Common Stock in  
excess of its ownership on August 2, 2002, the date of the Rights Agreement.    

Until the Distribution Date, (i) the Rights will be evidenced by the
Eligible Stock certificates, and will be transferred with and only with the     
Eligible Stock certificates, (ii) new Eligible Stock certificates issued after  
August 15, 2002 upon transfer or new issuance of the Eligible Stock will contain
a notation incorporating the Rights Agreement by reference, and (iii) the       
surrender for transfer of any certificates for Eligible Stock outstanding will  
also constitute the transfer of the Rights associated with the Eligible Stock   
represented by such certificate.                                                

      The Rights are not exercisable until the Distribution Date and will expire
at the close of business on August 2, 2012, unless earlier redeemed or exchanged
by the Company as described below. The Rights will not be exercisable by a      
holder in any jurisdiction where the requisite qualification to the issuance to 
such holder, or the exercise by such holder, of the Rights has not been obtained
or is not obtainable.                                                           

As soon as practicable following the Distribution Date, separate    
certificates evidencing the Rights ("Rights Certificates") will be mailed to    
holders of record of the Eligible Stock as of the close of business on the      
Distribution Date and, thereafter, the separate Rights Certificates alone will  
evidence the Rights.                                                            

     In the event that a Person becomes the beneficial owner of 15% or more of
the then outstanding shares of Class A Common Stock, each holder of a Right     
will, after the end of a redemption period referred to below, have the right to 
exercise the Right by purchasing, for an amount equal to the Purchase Price,    
Class A Common Stock (or, in certain circumstances, cash, property or other     
securities of the Company) having a value equal to two times such amount.       
Notwithstanding any of the foregoing, following the occurrence of the events set
forth in this paragraph, all Rights that are, or (under certain circumstances   
specified in the Rights Agreement) were, beneficially owned by any Acquiring    
Person will be null and void. However, Rights are not exercisable following the 
occurrence of the events set forth above until such time as the Rights are no   
longer redeemable by the Company as set forth below.                            

      For example, at a Purchase Price of $50.00 per Right, each Right not owned
by an Acquiring Person (or by certain related parties) following an event set   
forth in the preceding paragraph would entitle its holder to purchase           

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$100.00 worth of Class A Common Stock (or other consideration, as noted above)  
for $50.00. Assuming that the Class A Common Stock had a per share value of     
$20.00 at such time, the holder of each valid Right would be entitled to        
purchase five shares of Common Stock for $50.00.                                

    In the event that, at any time following the Stock Acquisition Date, (i)
the Company is acquired in a merger or other business combination transaction in
which the Company is not the surviving corporation, or (ii) 50% or more of the  
Company's assets or earning power is sold or transferred, each holder of a Right
(except Rights which previously have been voided as set forth above) shall,     
after the expiration of the redemption period referred to below, have the right 
to receive, upon exercise, common stock of the acquiring company having a value 
equal to two times the Purchase Price of the Right (e.g., common stock of the   
acquiring company having a value of $100.00 for the $50.00 Purchase Price).     

   At any time after a person or group of affiliated or associated persons
becomes an Acquiring Person, the Board of Directors of the Company may exchange 
the Rights (other than Rights owned by such person or group which have become   
void), in whole or in part, at an exchange ratio of one share of Class A Common 
Stock (or, in certain circumstances, other equity securities of the Company     
which are deemed by the Board of Directors of the Company to have the same value
as shares of Class A Common Stock) per Right (subject to adjustment).           

  The Purchase Price payable, and the number of one-one thousandths of a
share of Preferred Stock or other securities or property issuable, upon exercise
of the Rights are subject to adjustment from time to time to prevent dilution   
under certain circumstances.                                                    

With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1% in   
such Purchase Price. No fractional shares will be issued (other than fractions  
which are integral multiples of one-one thousandth of a share of Preferred      
Stock) and in lieu thereof, an adjustment in cash will be made based on the     
market price of the Preferred Stock on the last trading date prior to the date  
of exercise.                                                                    

    In general, the Board of Directors of the Company, may cause the Company
to redeem the Rights in whole, but not in part, at any time during the period   
commencing on August 15, 2002 and ending on the tenth day following the Stock   
Acquisition Date (the "Redemption Period") at a price of $0.005 per Right       
(payable in cash, Class A Common Stock or other consideration deemed appropriate
by the Board of Directors of the Company). Under certain circumstances set forth
in the Rights Agreements, the decision to redeem the Rights will require the    
concurrence of two thirds of the Directors. After the Redemption Period has     
expired, the Company's right of redemption may be reinstated if an Acquiring    
Person reduces his beneficial ownership to 10% or less of the outstanding shares
of Class A Common Stock in a transaction or series of transactions not involving
the Company and there are no other Acquiring Persons. Immediately upon the      
action of the Board of Directors of the Company ordering redemption of the      
Rights, the Rights will terminate and the only right of the holders of Rights   
will be to receive the $0.005 redemption price.                                 

 Until a Right is exercised, the holder thereof, as such, will have no
rights as a stockholder of the Company, including, without limitation, the right
to vote or to receive dividends. While the distribution of the Rights will not  
be subject to federal taxation to stockholders or to the Company, stockholders  
may, depending upon the circumstances, recognize taxable income in the event    
that the Rights become exercisable for Class A Common Stock (or other           
consideration) of the Company or for common stock of the acquiring company as   
set forth above.                                                                

 Except with respect to the Redemption Price of the Rights, any of the
provisions of the Rights Agreement may be amended by the Board of Directors of  
the Company prior to the Distribution Date. After the Distribution Date, the    
provisions of the Rights Agreement may be amended by the Board of Directors of  
the Company in order to cure any ambiguity, defect or inconsistency or to make  
changes which do not adversely affect the interests of holders of Rights        
(excluding the interests of any Acquiring Person), or to shorten or lengthen any
time period under the Rights Agreement; provided however, no amendment to adjust
the time period governing redemption may be made at such time as the Rights are 
not redeemable.                                                                 

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     As of March 31, 2002, there were 180,000,000 authorized shares of Class A
Common Stock, of which 75,317,556 shares were issued and outstanding, 15,000,000
authorized shares of Series A preferred stock, of which 10,786,504 were         
outstanding, and 250,000 authorized shares of Series C preferred stock, of which
220,869 were outstanding. Each share of Class A Common Stock and Series A       
preferred stock outstanding on August 15, 2002 will receive one Right. Each     
share of Series C preferred stock outstanding on August 15, 2002 will receive a 
number of Rights equal to the number of shares of Class A Common Stock in which 
a share of Series C preferred stock is convertible into on August 15, 2002. A   
total of 250,000 of the 60,000,000 shares of Preferred Stock authorized are     
reserved for issuance upon exercise of the Rights.                              

The Rights have certain anti-takeover effects. The Rights will cause
substantial dilution to a person or group that attempts to acquire the Company  
in a manner or on terms not approved by the Board of Directors of the Company.  
The Rights, however, should not deter any prospective offeror willing to        
negotiate in good faith with the Board of Directors of the Company. Nor should  
the Rights interfere with any merger or other business combination approved by  
the Board of Directors of the Company.                                          

    The Rights Agreement between the Company and the Rights Agent specifying
the terms of the Rights, which includes the form of Certificate of Designation  
of the Series D Junior Participating Preferred Stock as Exhibit A, the Summary  
of Rights to Purchase Series D Junior Participating Preferred Stock as Exhibit B
and the form of Rights Certificate as Exhibit C, is attached hereto as Exhibit  
99.1 and is incorporated herein by reference. In addition, the press release    
announcing the declaration of the Rights dividend is attached hereto as Exhibit 
99.2 and is incorporated herein by reference. The foregoing description of the  
Rights does not purport to be complete and is qualified in its entirety by      
reference to Exhibit 99.1 hereto.                                               

Item 7.  Financial Statements, Pro Forma Financial Information and Exhibits.    

99.1     Rights Agreement, dated as of August 2, 2002, between the Company and  
         Equiserve Trust Company, N.A., as Rights Agent, which includes the form
    of Certificate of Designation of the Series D Junior Participating
        Preferred Stock as Exhibit A, the Summary of Rights to Purchase Series
     D Junior Participating Preferred Stock as Exhibit B and the form of
Rights Certificate as Exhibit C.                              

99.2     Text of Press Release, dated August 2, 2002.                           

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 SIGNATURE

    Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the        
undersigned hereunto duly authorized.                                           

                      XM SATELLITE RADIO HOLDINGS INC.

Date:  August 2, 2002              By:  /s/ Joseph M. Titlebaum                 
                                        ----------------------------------------
                 Joseph M. Titlebaum
                                    Senior Vice President, General Counsel
           and Secretary

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 EXHIBIT INDEX
 -------------

Exhibit                                 Description                             
-------                                 -----------                             

99.1     Rights Agreement, dated as of August 2, 2002, between the Company and  
         Equiserve Trust Company, N.A., as Rights Agent, which includes the form
    of Certificate of Designation of the Series D Junior Participating
        Preferred Stock as Exhibit A, the Summary of Rights to Purchase Series
     D Junior Participating Preferred Stock as Exhibit B and the form of
Rights Certificate as Exhibit C.                              

99.2     Text of Press Release, dated August 2, 2002.                           

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘8-K’ Filing		Date		First		Last			Other Filings
		8/2/12		2
		8/15/02		2		4
Filed on / For Period End:		8/2/02		2		6			S-8
		3/31/02		4					10-Q
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