Washington — XM Satellite Radio reached an agreement with 95 percent of the holders on $400 million in 1.75 percent senior convertible notes, which may reduce its need to refinance in the event that it merges with Sirius Satellite Radio.
XM said holders of the notes, due this month agreed to exchange these for new senior convertible notes due in 2009 that will have an interest rate of 10 percent. In exchange, the note holders agreed not to assert any claim that the proposed merger trigger a "Fundamental Change" clause under the existing agreement.
The agreement comes at a time when a recent Goldman Sachs report claiming XM and Sirius would need to refinance up to $1.46 billion in debt in the event they merge, which stock prices tumbling earlier this week.
XM said it had no further comments.