Sirius XM Holdings Inc. – ‘8-K’ for 10/7/04 – EX-1

On:  Wednesday, 10/13/04, at 3:52pm ET   ·   For:  10/7/04   ·   Accession #:  950117-4-3580   ·   File #:  0-24710

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Current Report   —   Form 8-K
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 8-K         Sirius Satellite Radio, Inc.                        HTML     20K 
 2: EX-1        Exhibit 1.1                                            6     28K 
 3: EX-1        Exhibit 1.2                                            7     32K 
 4: EX-4        Exhibit 4.1                                           41    156K 

EX-1   —   Exhibit 1.1

EX-1
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                                                                   Exhibit 1.1

 SIRIUS SATELLITE RADIO INC.
(A Delaware corporation)

 25,000,000 Shares of Common Stock

 TERMS AGREEMENT
 ---------------

                                                                 October 7, 2004

To:      Sirius Satellite Radio Inc.                                            
1221 Avenue of the Americas, 36th Floor                       
New York, New York 10020                                      

Ladies and Gentlemen:                                                           

                 This is a Terms Agreement referenced in the Form Underwriting
Agreement attached hereto, as contemplated by the Registration Statement No.    
333-108387. The terms of the Form Underwriting Agreement are hereby incorporated
herein. We understand that Sirius Satellite Radio Inc., a Delaware corporation  
(the "Company"), proposes to issue and sell 25,000,000 shares of its common     
stock, par value $.001 per share (the "Underwritten Securities"). Subject to the
terms and conditions set forth or incorporated by reference herein, Morgan      
Stanley & Co. Incorporated (the "Underwriter") offers to purchase the total     
aggregate number of Underwritten Securities, and some or all of the Option      
Underwritten Securities set forth below, to the extent any Underwritten         
Securities or Option Underwritten Securities are purchased in accordance with   
the terms hereof.                                                               

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The Underwritten Securities shall have the following terms:   

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                                       Common Stock                              
                                       ------------                              
                                                                                 
Title:                    Common Stock, par value $.001 per share.               

Number of Shares:         25,000,000                                             

Number of Option          The Underwriter has an option to purchase up to an     
Underwritten Securities:  additional 3,750,000 shares of Underwritten            
                          Securities (the "Option Underwritten Securities")      
                          at the purchase price set forth below, within          
                          30 days from the Closing Date to cover over-allotments.

Purchase price:           $3.85 per share.                                       

Listing requirements:     Nasdaq National Market.                                

Lock-up provisions:       For a period of 90 days from the date of the           
                          Prospectus Supplement relating to the Underwritten     
                          Securities, the Company will not, without the          
                          prior written consent of the Underwriter, (1)          
                          offer, pledge, sell, contract to sell, sell any        
                          option or contract to purchase, purchase any           
                          option or contract to sell, grant any option,          
                          right or warrant to purchase, lend, or otherwise       
                          transfer or dispose of, directly or indirectly,        
                          any shares of common stock or any securities           
                          convertible into or exercisable or exchangeable        
                          for common stock or (2) enter into any swap or         
                          other arrangement that transfers to another, in        
                          whole or in part, any of the economic consequences     
                          of ownership of the common stock, whether any such     
                          transaction described in clause (1) or (2) above       
                          is to be settled by delivery of common stock or        
                          such other securities, in cash or otherwise, or        
                          (3) file or cause to become effective a                
                          registration statement relating to the offer and       
                          sale of any shares of common stock or any              
                          securities convertible into or exercisable or          
                          exchangeable for common stock, other than (i)          
                          shares of stock that may be issued in connection       
                          with the Company's long-term stock incentive plan      
                          or 401(k) plan or (ii) amendments to the Company's     
                          registration statement on Form S-3 (File No.           
                          333-115695) as are necessary to permit holders of      
                          the Company's 2 1/2% Convertible Notes due 2009        
                          (issued on February 20, 2004) to resell those          
                          securities or the underlying common stock in a         
                          registered transaction.                                


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                              The foregoing sentence shall not apply to (a) the 
                              sale of any Underwritten Securities to the        
                              Underwriter pursuant to the Form Underwriting     
                              Agreement and this Terms Agreement, (b)           
                              transactions relating to shares of common stock or
                              other securities acquired in open market          
                              transactions after the completion of the Public   
                              Offering or (c) the issuance by the Company of    
                              additional options under the Company's existing   
                              stock option plans, provided that such options are
                              not exercisable during such 90-day period.        

Comfort Letter:               The Company shall cause the Accountant's Comfort  
                              Letter and the Bring-down Comfort Letter          
                              referenced in, respectively Section 5(g) and      
                              Section 5(h) of the Form Underwriting Agreement to
                              be delivered, except that such letters will be    
                              delivered by Ernst & Young LLP in lieu of Arthur  
                              Andersen LLP.                                     

Additional Representations    The Company represents and warrants to and        
of the Company:               agrees with the Underwriter that there are no     
                              contracts, agreements or understandings between   
                              the Company and any person granting such person   
                              the right to require the Company to file a        
                              registration statement under the Securities Act   
                              with respect to any securities of the Company or  
                              to require the Company to include such securities 
                              with the Underwritten Securities registered       
                              pursuant to the Registration Statement, other than
                              the agreements granting registration rights to    
                              affiliates of The Blackstone Group L.P. and Apollo
                              Management, L.P.                                  

Additional Covenants of the   The Company covenants with the Underwriter whether
Company:                      or not the transactions contemplated in this      
                              Agreement are consummated or this Agreement is    
                              terminated, to pay or cause to be paid all        
                              expenses incident to the performance of its       
                              obligations under this Agreement, including: (i)  
                              the cost of printing or producing any Blue Sky or 
                              Legal Investment memorandum in connection with the
                              offer and sale of the Underwritten Securities     
                              under state securities laws and all expenses in   
                              connection with the qualification of the          
                              Securities for offer and sale under state         
                              securities laws as provided in Section 3(f) of the
                              Form Underwriting Agreement, including filing fees
                              and the reasonable fees and disbursements of      
                              counsel for the Underwriter in connection with    
                              such qualification and in connection with the Blue
                              Sky or Legal Investment memorandum, (ii) the cost 
                              of printing certificates                          


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                            representing the Underwritten Securities, (iii)       
                            the costs and charges of any transfer agent,          
                            registrar or depositary, (iv) the document            
                            production charges and expenses associated with       
                            printing this Agreement and (v) all other costs       
                            and expenses incident to the performance of the       
                            obligations of the Company hereunder for which        
                            provision is not otherwise made in this Section.      
                            It is understood, however, that except as provided    
                            in Sections 4, 6 and 7 of the Form Underwriting       
                            Agreement, "Additional Covenants of the Company"      
                            and "Additional Termination Provisions" below, the    
                            Underwriter will pay all of its costs and             
                            expenses, including fees and disbursements of its     
                            counsel, stock transfer taxes payable on resale of    
                            any of the Underwritten Securities by it and any      
                            advertising expenses connected with any offers it     
                            may make.                                             

Additional Conditions of    The obligations of the Underwriter to purchase and pay
Underwriter's Obligations:  for the Underwritten Securities pursuant this Terms   
                            Agreement are subject to the following further        
                            conditions: subsequent to execution and delivery      
                            of this Terms Agreement and prior to the Closing      
                            Date there shall not have occurred any change, or     
                            any development involving a prospective change, in    
                            the condition, financial or otherwise, or in the      
                            earnings, business or operations of the Company       
                            and its subsidiaries, taken as a whole, from that     
                            set forth in the Prospectus (exclusive of any         
                            amendments or supplements thereto subsequent to       
                            the date of this Agreement) that, in the              
                            Underwriter's judgment, is material and adverse       
                            and that makes it, in the Underwriter's judgment,     
                            impracticable to market the Underwritten              
                            Securities on the terms and in the manner             
                            contemplated in the Prospectus.                       

Additional Termination      The Underwriter may terminate this Terms              
Provisions:                 Agreement, by notice to the Company at any time at    
                            or prior to the Closing Date if (i) trading is        
                            suspended or materially limited on, or by, as the     
                            case may be, any of the Chicago Board of Options      
                            Exchange, the Chicago Mercantile Exchange or the      
                            Chicago Board of Trade, (ii) a material disruption    
                            in securities settlement, payment or clearance        
                            services in the United States shall have occurred,    
                            or (iii) there shall have occurred any outbreak or    
                            escalation of hostilities, or any change in           
                            financial markets or any calamity or crisis that,     
                            in the Underwriter's judgment, is material and        
                            adverse and which, singly or together with            

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                              any other event specified in this clause (iii),   
                              makes it, in the Underwriter's judgment,          
                              impracticable or inadvisable to proceed with the  
                              offer, sale or delivery of the Underwritten       
                              Securities on the terms and in the manner         
                              contemplated in the Prospectus.                   

                              If this Terms Agreement shall be terminated by the
                              Underwriter because of any failure or refusal on  
                              the part of the Company to comply with the terms  
                              or to fulfill any of the conditions of this Terms 
                              Agreement, or if for any reason the Company shall 
                              be unable to perform its obligations under this   
                              Terms Agreement, the Company will reimburse the   
                              Underwriter for all out-of-pocket expenses        
                              (including the fees and disbursements of its      
                              counsel) reasonably incurred by the Underwriter in
                              connection with this Terms Agreement or the       
                              offering contemplated hereunder.                  

Additional Indemnification    The Company agrees to indemnify and hold harmless 
Provisions:                   each affiliate of the Underwriter within the      
                              meaning of Rule 405 under the 1933 Act.           

Other Terms:                  This Terms Agreement may be signed in             
                              counterparts, each of which shall be an original, 
                              with the same effect as if the signatures thereto 
                              and hereto were upon the same instrument.         

Notices:                      All notices and other communications hereunder    
                              shall be in writing and shall be deemed to have   
                              been duly given if mailed or transmitted by any   
                              standard form of telecommunication. Notices to the
                              Underwriter shall be directed to Morgan Stanley & 
                              Co. Incorporated, 1585 Broadway, New York, NY     
                              10036, Attention: Global Capital Markets Syndicate
                              Desk; notices to the Company shall be directed to 
                              the Company at 1221 Avenue of the Americas, 36th  
                              Floor, New York, New York 10020, Attention:       
                              Patrick L. Donnelly, Executive Vice President,    
                              General Counsel and Secretary.                    

Closing Date and location:    October 13, 2004                                  
                              10:00 a.m.                                        
                              Cravath, Swaine & Moore LLP                       
                              Worldwide Plaza                                   
                              825 Eighth Avenue                                 
                              New York, NY 10019-7475                           


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            Please accept this offer by signing a copy of this Terms
Agreement in the space set forth below and returning the signed copy to us.     

                                           Very truly yours,

                                              MORGAN STANLEY & CO.
                                          INCORPORATED

                                by
                                                         /s/ James C. Murray
                                                          --------------------
                                                             James C. Murray
                                                            Vice President

Accepted:                                                                       

SIRIUS SATELLITE RADIO INC.                                                     

by                                                                    
/s/ Patrick L. Donnelly                                   
---------------------------------                         
Patrick L. Donnelly                               
Executive Vice President,                         
General Counsel and Secretary                     

Dates Referenced Herein   and   Documents Incorporated by Reference

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This ‘8-K’ Filing		Date		First		Last			Other Filings
Filed on:		10/13/04		5					None on these Dates
For Period End:		10/7/04		1
		2/20/04		2
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