Notes to Unaudited Select Consolidated Balance Sheets Data
(1) Principles of Consolidation and Basis of Presentation
The unaudited select consolidated balance sheets data includes the accounts of XM Satellite Radio Holdings Inc. and its subsidiaries. All significant intercompany
transactions and accounts have been eliminated. In the opinion of management, the above unaudited select consolidated balance sheets data reflects all adjustments, consisting of only normal recurring entries, necessary for a fair presentation of the
consolidated financial position of XM Satellite Radio Holdings Inc. and its subsidiaries, as of November 30, 2002 and September 30, 2002. The select consolidated balance sheets data is unaudited and does not include all related footnote disclosures.
The interim unaudited select consolidated balance sheets data should be read in conjunction with the Company’s audited financial statements included in its filings with the Securities and Exchange Commission.
(2) Goodwill and Other Intangible Assets
On November 30, 2002, the Company conducted its Step 1 impairment analysis under SFAS No. 142, Goodwill and Other Intangible Assets (“SFAS No. 142”) and determined that the carrying
value of the Company’s net assets exceeded the fair value of the Company. Accordingly, the Company is required to conduct its Step 2 impairment analysis and may be required to record an impairment charge during the fourth quarter of 2002. The
carrying value of the DARS license and the goodwill was $144,042 and $11,461, respectively, at November 30, 2002. The unaudited select consolidated balance sheets data does not include any adjustments to provide for the possible impairment, if any.
(3) Book Value Per Share Calculation
Book value per share at November 30, 2002 was $3.00. Book value per share means stockholders’ equity ($658,845) minus the liquidation
preferences of the Company’s Series A convertible preferred stock ($102,739), Series B convertible redeemable preferred stock ($43,364), and Series C convertible redeemable preferred stock ($238,133) divided by the number of Class A common
stock outstanding at November 30, 2002 (91,643,794 shares).
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, each of the registrants has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
XM SATELLITE RADIO HOLDINGS INC.
By:
/s/ JOSEPH M.
TITLEBAUM
Joseph M. Titlebaum
Senior
Vice President, General Counsel and Secretary
