Sirius/XM Case Study

MERGER ANTITRUST LAW Sirius/XM

(Full Set of Case Materials)

Professor Dale Collins Georgetown University Law Center SHORT HORIZONTAL CASE STUDIES

Table of Contents

Sirius/XM XM Satellite Radio & SIRIUS Satellite Radio, News Release, SIRIUS and XM to Combine in $13 Billion Merger of Equals (Feb. 19, 2007)...... 3 XM Satellite Radio & SIRIUS Satellite Radio, Investor Presentation (Feb. 20, 2007) ...... 11 Statement of the Department of Justice Antitrust Division on its Decision to Close its Investigation of XM Satellite Radio Holdings Inc.'s Merger with Sirius Satellite Radio Inc. (Mar. 24, 2008) ...... 32 Fed. Commc'ns Comm'n, News Release, Commission Approves Transaction between Sirius Satellite Radio Holdings Inc. and XM Satellite Radio Holdings, Inc. Subject to Conditions (July 28, 2008) ...... 36 SIRIUS XM Radio, News Release, SIRIUS and XM Complete Merger (July 29, 2008) ...... 43

2 NEWS RELEASE

SIRIUS and XM to Combine in $13 Billion Merger of Equals

2/19/2007

PROVIDES CONSUMERS WITH ENHANCED CONTENT, GREATER CHOICES AND ACCELERATED TECHNOLOGICAL INNOVATION

ENABLES SATELLITE RADIO TO BETTER COMPETE IN RAPIDLY EVOLVING AUDIO ENTERTAINMENT INDUSTRY

EXTRAORDINARY VALUE CREATION FOR SHAREHOLDERS

MEL KARMAZIN TO SERVE AS CHIEF EXECUTIVE OFFICER AND GARY PARSONS TO SERVE AS CHAIRMAN OF COMBINED COMPANY

WASHINGTON and NEW YORK, Feb. 19 /PRNewswire-FirstCall/ -- XM Satellite Radio (NASDAQ: XMSR) and SIRIUS Satellite Radio (NASDAQ: SIRI) today announced that they have entered into a definitive agreement, under which the companies will be combined in a tax-free, all-stock merger of equals with a combined enterprise value of approximately $13 billion, which includes net debt of approximately $1.6 billion.

Under the terms of the agreement, XM shareholders will receive a fixed exchange ratio of 4.6 shares of SIRIUS common stock for each share of XM they own. XM and SIRIUS shareholders will each own approximately 50 percent of the combined company.

Mel Karmazin, currently Chief Executive Officer of SIRIUS, will become Chief Executive Officer of the combined company and Gary Parsons, currently Chairman of XM, will become Chairman of the combined company. The new

3 company's board of directors will consist of 12 directors, including Messrs. Karmazin and Parsons, four independent members designated by each company, as well as one representative from each of General Motors and American Honda. Hugh Panero, the Chief Executive Officer of XM, will continue in his current role until the anticipated close of the merger.

The combined company will benefit from a highly experienced management team from both companies with extensive industry knowledge in radio, media, consumer electronics, OEM engineering and technology. Further management appointments will be announced prior to closing. The companies will continue to operate independently until the transaction is completed and will work together to determine the combined company's corporate name and headquarters location prior to closing.

The combination creates a nationwide audio entertainment provider with combined 2006 revenues of approximately $1.5 billion based on analysts' consensus estimates. Today the companies have approximately 14 million combined subscribers. Together, SIRIUS and XM will create a stronger platform for future innovation within the audio entertainment industry and will provide significant benefits to all constituencies, including:

* Greater Programming and Content Choices -- The combined company is committed to consumer choice, including offering consumers the ability to pick and choose the channels and content they want on a more a la carte basis. The combined company will also provide consumers with a broader selection of content, including a wide range of commercial-free music channels, exclusive and non-exclusive sports coverage, news, talk, and entertainment programming. Together, XM and SIRIUS will be able to improve on products such as real-time traffic and rear-seat video and introduce new ones such as advanced data services including enhanced traffic, weather and infotainment offerings.

* Accelerated Technological Innovation -- The merger will enable the combined company to develop and introduce a wider range of lower cost, easy-to-use, and multi-functional devices through efficiencies in chip set and radio design and procurement. Such innovation is essential to remaining competitive in the consumer electronics-driven world of audio entertainment.

* Benefits to OEM and Retail Partners -- The combined company will offer automakers and retailers the opportunity to provide a broader content offering to their customers. Consumer electronics retailers, including Best Buy, Circuit City, RadioShack, Wal-Mart and others, will benefit from enhanced product offerings that should allow satellite radio to compete more effectively.

* Enhanced Financial Performance -- This transaction will enhance the 2

4 long-term financial success of satellite radio by allowing the combined company to better manage its costs through sales and marketing and subscriber acquisition efficiencies, satellite fleet synergies, combined R&D and other benefits from economies of scale. Wall Street equity analysts have published estimates of the present value of cost synergies ranging from $3 billion to $7 billion.

* More Competitive Audio Entertainment Provider -- The combination of an enhanced programming lineup with improved technology, distribution and financials will better position satellite radio to compete for consumers' attention and entertainment dollars against a host of products and services in the highly competitive and rapidly evolving audio entertainment marketplace. In addition to existing competition from free "over-the-air" AM and FM radio as well as iPods and mobile phone streaming, satellite radio will face new challenges from the rapid growth of HD Radio, Internet radio and next generation wireless technologies.

"We are excited for the many opportunities that an XM and SIRIUS combination will provide consumers," said Gary Parsons, Chairman of XM Satellite Radio and Hugh Panero, CEO of XM Satellite Radio, in a joint statement. "The combined company will be better positioned to compete effectively with the continually expanding array of entertainment alternatives that consumers have embraced since the Federal Communications Commission (FCC) first granted our satellite radio licenses a decade ago."

"This combination is the next logical step in the evolution of audio entertainment," said Mel Karmazin, CEO of SIRIUS Satellite Radio. "Together, our best-in-class management team and programming content will create unprecedented choice for consumers, while creating long-term value for shareholders of both companies. The combined company will be positioned to capitalize on SIRIUS and XM's complementary distribution and licensing agreements to enhance availability of satellite radios, offer expanded content to subscribers, drive increased advertising revenue and reduce expenses. Each of our companies has a strong commitment to providing listeners the broadest range of music, news, sports and entertainment and the best customer service possible. We look forward to sharing the benefits of the exciting new growth opportunities this combination will provide with all of our stakeholders."

The transaction is subject to approval by both companies' shareholders, the satisfaction of customary closing conditions and regulatory review and approvals, including antitrust agencies and the FCC. Pending regulatory approval, the companies expect the transaction to be completed by the end of 2007.

SIRIUS's financial advisor on the transaction is Morgan Stanley and Simpson Thacher & Bartlett LLP and Wiley Rein LLP are acting as legal counsel. XM's financial advisor on the transaction is J.P. Morgan Securities Inc. and Skadden 3

5 Arps, Slate, Meagher & Flom LLP; Jones Day; and Latham & Watkins LLP are acting as legal counsel.

Conference Call and Webcast Information

The companies will hold a joint conference call and webcast on Tuesday, February 20, 2007 at 8:30 AM ET to discuss this announcement. The conference call can be monitored by dialing 800-573-4840 within the U.S. and 617-224- 4326 for all other locations, passcode 29490052. The webcast can be accessed at http://www.sirius.com/ and http://www.xmradio.com/ as well as on their satellite radio services by tuning to SIRIUS channel 122 and XM channel 200. The webcast will be archived at http://www.sirius.com/ and http://www.xmradio.com/.

About SIRIUS

SIRIUS, "The Best Radio on Radio," delivers more than 130 channels of the best programming in all of radio. SIRIUS is the original and only home of 100% commercial free music channels in satellite radio, offering 69 music channels. SIRIUS also delivers 65 channels of sports, news, talk, entertainment, traffic, weather and data. SIRIUS is the Official Satellite Radio Partner of the NFL, NASCAR, NBA and NHL, and broadcasts live play-by-play games of the NFL, NBA and NHL, as well as live NASCAR races. All SIRIUS programming is available for a monthly subscription fee of only $12.95.

SIRIUS Internet Radio (SIR) is a CD-quality, Internet-only version of the SIRIUS radio service, without the use of a radio, for the monthly subscription fee of $12.95. SIR delivers more than 75 channels of talk, entertainment, sports, and 100% commercial free music.

SIRIUS products for the car, truck, home, RV and boat are available in more than 25,000 retail locations, including Best Buy, Circuit City, Crutchfield, Costco, Target, Wal-Mart, Sam's Club, RadioShack and at http://shop.sirius.com/.

SIRIUS radios are offered in vehicles from Audi, Bentley, BMW, Chrysler, Dodge, Ford, Infiniti, Jaguar, Jeep®, Land Rover, Lexus, Lincoln, Mercury, Maybach, Mazda, Mercedes-Benz, MINI, Mitsubishi, Nissan, Rolls Royce, Scion, Toyota, Volkswagen, and Volvo. Hertz also offers SIRIUS in its rental cars at major locations around the country.

Click on http://www.sirius.com/ to listen to SIRIUS live, or to purchase a SIRIUS radio and subscription.

About XM

XM (NASDAQ: XMSR) is America's number one satellite radio company with more than 7.6 million subscribers. Broadcasting live daily from studios in Washington, DC, New York City, Chicago, the Country Music Hall of Fame in Nashville, Toronto and Montreal, XM's 2007 lineup includes more than 170 digital channels of choice from coast to

6 coast: commercial-free music, premier sports, news, talk radio, comedy, children's and entertainment programming; and the most advanced traffic and weather information.

XM, the leader in satellite-delivered entertainment and data services for the automobile market through partnerships with General Motors, Honda, Hyundai, Nissan, Porsche, Subaru, Suzuki and Toyota is available in 140 different vehicle models for 2007. XM's industry-leading products are available at consumer electronics retailers nationwide. For more information about XM hardware, programming and partnerships, please visit http://www.xmradio.com/.

Forward Looking Statements

This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about the benefits of the business combination transaction involving Sirius Satellite Radio Inc. and XM Satellite Radio Holdings Inc., including potential synergies and cost savings and the timing thereof, future financial and operating results, the combined company's plans, objectives, expectations and intentions with respect to future operations, products and services; and other statements identified by words such as "anticipate," "believe," "plan," "estimate," "expect," "intend," "will," "should," "may," or words of similar meaning. Such forward- looking statements are based upon the current beliefs and expectations of SIRIUS' and XM's management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are difficult to predict and generally beyond the control of SIRIUS and XM. Actual results may differ materially from the results anticipated in these forward-looking statements.

The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statement: general business and economic conditions; the performance of financial markets and interest rates; the ability to obtain governmental approvals of the transaction on a timely basis; the failure of SIRIUS and XM shareholders to approve the transaction; the failure to realize synergies and cost-savings from the transaction or delay in realization thereof; the businesses of SIRIUS and XM may not be combined successfully, or such combination may take longer, be more difficult, time-consuming or costly to accomplish than expected; and operating costs and business disruption following the merger, including adverse effects on employee retention and on our business relationships with third parties, including manufacturers of radios, retailers, automakers and programming providers. Additional factors that could cause SIRIUS' and XM's results to differ materially from those described in the forward-looking statements can be found in SIRIUS' and XM's Annual Reports on Form 10-K for the year ended December 31, 2005, and Quarterly Reports on Form 10-Q for the quarters ended March 31, 2006, June 30, 2006 and September 30, 2006 which are filed with the Securities and Exchange Commission (the "SEC") and available at the SEC's Internet site (http://www.sec.gov/). The

7 information set forth herein speaks only as of the date hereof, and Sirius and XM disclaim any intention or obligation to update any forward looking statements as a result of developments occurring after the date of this press release.

Important Additional Information Will be Filed with the SEC

This communication is being made in respect of the proposed business combination involving SIRIUS and XM. In connection with the proposed transaction, SIRIUS plans to file with the SEC a Registration Statement on Form S-4 containing a Joint Proxy Statement/Prospectus and each of SIRIUS and XM plan to file with the SEC other documents regarding the proposed transaction. The definitive Joint Proxy Statement/Prospectus will be mailed to stockholders of SIRIUS and XM. INVESTORS AND SECURITY HOLDERS OF SIRIUS AND XM ARE URGED TO READ THE JOINT PROXY STATEMENT/PROSPECTUS AND OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED TRANSACTION.

Investors and security holders will be able to obtain free copies of the Registration Statement and the Joint Proxy Statement/Prospectus (when available) and other documents filed with the SEC by SIRIUS and XM through the web site maintained by the SEC at http://www.sec.gov/. Free copies of the Registration Statement and the Joint Proxy Statement/Prospectus (when available) and other documents filed with the SEC can also be obtained by directing a request to Sirius Satellite Radio Inc., 1221 Avenue of the Americas, New York, NY 10020, Attention: Investor Relations or by directing a request to XM Satellite Radio Holdings Inc., 1500 Eckington Place, NE Washington, DC 20002, Attention: Investor Relations.

SIRIUS, XM and their respective directors and executive officers and other persons may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. Information regarding SIRIUS' directors and executive officers is available in its Annual Report on Form 10-K for the year ended December 31, 2005, which was filed with the SEC on March 13, 2006, and its proxy statement for its 2006 annual meeting of stockholders, which was filed with the SEC on April 21, 2006, and information regarding XM's directors and executive officers is available in XM's Annual Report on Form 10-K, for the year ended December 31, 2005, which was filed with the SEC on March 3, 2006 and its proxy statement for its 2006 annual meeting of shareholders, which was filed with the SEC on April 25, 2006. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the Joint Proxy Statement/Prospectus and other relevant materials to be filed with the SEC when they become available.

Contacts

8 SIRIUS Media Relations Patrick Reilly 212-901-6646 [email protected]

Investor Relations Paul Blalock 212-584-5174 [email protected]

Hooper Stevens 212-901-6718 [email protected]

XM Media Relations Nathaniel Brown 212-708-6170 [email protected]

Chance Patterson 202-380-4318 [email protected]

Investor Relations Joseph Wilkinson 202-380-4008 [email protected] Richard Sloane 202-380-1439 [email protected]

SOURCE: SIRIUS Satellite Radio; XM Satellite Radio

CONTACT: Patrick Reilly, Media Relations, +1-212-901-6646, [email protected], or Paul Blalock, Investor Relations, +1-212-584-5174, [email protected], or Hooper Stevens, Investors Relations, +1-212-901-6718, [email protected], all of SIRIUS, or Nathaniel Brown, Media Relations, +1-212-708-6170, [email protected], or Chance Patterson, Media Relations, +1-202-380-4318, [email protected], or Joseph Wilkinson, Investor Relations, +1-202-380-4008, [email protected], or Richard Sloane,

9 Investor Relations, +1-202-380-1439, [email protected], all of XM

Web site: http://www.xmradio.com/ http://www.sirius.com/ http://shop.sirius.com/

10 February 20, 2007

11 Forward-Looking Statements

This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about the benefits of the business combination transaction involving Sirius Satellite Radio Inc. and XM Satellite Radio Holdings Inc., including potential synergies and cost savings and the timing thereof, future financial and operating results, the combined company’s plans, objectives, expectations and intentions with respect to future operations, products and services; and other statements identified by words such as “anticipate,” “believe,” “plan,” “estimate,” “expect,” “intend,” “will,” “should,” “may,” or words of similar meaning. Such forward-looking statements are based upon the current beliefs and expectations of SIRIUS’ and XM’s management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are difficult to predict and generally beyond the control of SIRIUS and XM. Actual results may differ materially from the results anticipated in these forward-looking statements.

The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statement: general business and economic conditions; the performance of financial markets and interest rates; the ability to obtain governmental approvals of the transaction on a timely basis; the failure of SIRIUS and XM shareholders to approve the transaction; the failure to realize synergies and cost-savings from the transaction or delay in realization thereof; the businesses of SIRIUS and XM may not be combined successfully, or such combination may take longer, be more difficult, time-consuming or costly to accomplish than expected; and operating costs and business disruption following the merger, including adverse effects on employee retention and on our business relationships with third parties, including manufacturers of radios, retailers, automakers and programming providers. Additional factors that could cause SIRIUS’ and XM’s results to differ materially from those described in the forward- looking statements can be found in SIRIUS’ and XM’s Annual Reports on Form 10-K for the year ended December 31, 2005, and Quarterly Reports on Form 10-Q for the quarters ended March 31, 2006, June 30, 2006 and September 30, 2006 which are filed with the Securities and Exchange Commission (the "SEC") and available at the SEC’s Internet site (http://www.sec.gov). The information set forth herein speaks only as of the date hereof, and Sirius and XM disclaim any intention or obligation to update any forward looking statements as a result of developments occurring after the date of this press release.

12 Important Additional Information

Investors and security holders will be able to obtain free copies of the Registration Statement and the Joint Proxy Statement/Prospectus (when available) and other documents filed with the SEC by SIRIUS and XM through the web site maintained by the SEC at www.sec.gov. Free copies of the Registration Statement and the Joint Proxy Statement/Prospectus (when available) and other documents filed with the SEC can also be obtained by directing a request to Sirius Satellite Radio Inc., 1221 Avenue of the Americas, New York, NY 10020, Attention: Investor Relations or by directing a request to XM Satellite Radio Holdings Inc., 1500 Eckington Place, NE Washington, DC 20002, Attention: Investor Relations.

SIRIUS, XM and their respective directors and executive officers and other persons may be deemed to be participants in the solicitation of proxies in respect of the proposed transaction. Information regarding SIRIUS’ directors and executive officers is available in its Annual Report on Form 10-K for the year ended December 31, 2005, which was filed with the SEC on March 13, 2006, and its proxy statement for its 2006 annual meeting of stockholders, which was filed with the SEC on April 21, 2006, and information regarding XM’s directors and executive officers is available in XM’s Annual Report on Form 10-K, for the year ended December 31, 2005, which was filed with the SEC on March 3, 2006 and its proxy statement for its 2006 annual meeting of shareholders, which was filed with the SEC on April 25, 2006. Other information regarding the participants in the proxy solicitation and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the Joint Proxy Statement/Prospectus and other relevant materials to be filed with the SEC when they become available.

13 Mel Karmazin CEO, SIRIUS Satellite Radio

14 Combination Benefits Consumers and Shareholders Alike

Provides consumer with best-of-breed programming and innovative products and services

Company better positioned to compete in rapidly evolving audio entertainment marketplace

Best-in-class combined management team with proven leadership

Potential for meaningful value creation through cost savings

Merger accelerates and enhances cash flows

15 Advantages for Subscribers

Best audio content available anywhere

Broader content choices

Greater program diversity can address underserved population groups

Best content from both companies

Accelerated technological innovation

16 Accelerated Technological Innovation

Accelerate development and commercial introduction of radios allowing consumers access to a full range of programming offered by XM and SIRIUS today

Focus engineering talent and capital resources on developing highly portable, low-cost, easy-to-use, multi-functional devices

Improve technical capabilities of next generation satellites to enhance service quality and breadth of products supported

Offer consumers innovative value-added services, including live video, real-time traffic and weather, and infotainment options

17 Great Value for Shareholders

Significant, realizable cost synergies

A fantastic growth story with strong future cash flows

Greater programming diversity reaches broader audience and expands addressable market

Carefully considered path to regulatory approval

18 Wall Street Analysts Estimate $3 - $7 Billion in Capitalized Cost Savings

Synergy value equivalent to market capitalization of SIRIUS or XM Wall Street’s Capitalized OperatingSynergy Estimatescost savings of achievable in every P&L line item – General$3.0-7.0 and Billion administrative costs – Sales and marketing costs – Subscriber acquisition costs – Research and development costs – Product development, manufacturing and inventory costs – Programming operating infrastructure

Longer term, satellite fleet, terrestrial infrastructure, and other capital cost redundancies will offer additional shareholder value

19 Significantly Enhanced Advertising Platform

YE 2006 Satellite Radio Subs Merged company is more (Millions) attractive to large national 15 13.6 advertisers that have a significant number of media alternatives XM 7.6 AM/FM radio 2006 advertising market ~$20 billion(1) – Satellite radio 2006 advertising market ~$70 million(2) SIRIUS 6.0 Advertising sales expense savings

0 (1) Source: Radio Advertising Bureau (www.RAB.com) (2) Source: Consensus Wall Street estimate

20 Approximately 14 Million Subscribers and Growing

Ending Satellite Industry Radio & DBS Wireless Subs (MM) Subs (MM) Subs (MM) 13.6MM 14 80 180

Wireless 160 12 70 % 47 140 : 1 60 10 R G A 120 C 50 er 8 ib 100 scr ub 40 S r 80 6 ea Y 4- 30 Satellite Radio Satellite TV 60 4 20 40 2 10 20

0 0 0 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Y1 Y3 Y5 Y7 Y9 Y11 Y13 Y15 Y17 Y19 2003 2004 2005 2006 Years Since Launch Source: Company Data Source: UBS Research

2006 Consensus Revenue Estimate of ~$1.5 Billion, ~90% Growth Relative to 2005

21 Unique Nationwide Audio Entertainment Investment Opportunity

Greater Programming Choices Accelerates Technological Innovation & Data Services Availability Better Positioned to Compete in Rapidly Evolving Audio Entertainment Industry Increases Advertising Reach Improved Financial Performance through Realization of Cost Synergies Enhanced Operating Leverage Resulting in Accelerated Free Cash Flow Generation Highly Experienced Management Team from Both Companies with Proven Leadership Significant Value Creation for all Stakeholders

22 Gary Parsons Chairman, XM Satellite Radio

23 Transaction Overview

Transaction Tax-free, all-stock merger of equals

Exchange Ratio Fixed exchange ratio of 4.60 shares of SIRIUS for each XM share

Pro Forma Ownership ~50% SIRIUS shareholders; ~50% XM shareholders

Leadership Gary Parsons, Chairman Mel Karmazin, CEO

Board Composition 12 directors: Chairman, CEO, 4 independent members designated by each company, GM and Honda representatives

Anticipated Close End of 2007, subject to regulatory approval

Approvals SIRIUS and XM shareholders, and regulatory approvals

24 Regulatory Overview

SIRIUS-XM combination is in the public interest – Greater choice of programming, best content and devices from both platforms – Eliminating duplicate channels allows targeting of underserved communities

Robust competition post-merger – 223MM weekly AM/FM radio listeners in US today across more than 10,000 radio stations – Current subscriber base ~10% of US households, < 7% of US vehicles – Market for audio entertainment has evolved dramatically with expanding competitive options ● iPod/MP3/Internet radio are growing rapidly with proven popularity ● Cell phone operators are driving into their networks and handsets music capabilities quickly (i.e., iPhone, VCast, LG Chocolate, MobiTV, etc.) ● Emerging next generation networks/technologies will provide additional competitive alternatives (i.e., WiMax, Modeo, MediaFLO, etc.)

25 Regulatory Overview (cont’d)

Combined company’s success will be driven by increased subscriber penetration – Subscriber growth and future success will be dependent upon attractive consumer price points for both equipment and service

Efficiencies from combination will allow SIRIUS-XM to compete more effectively and benefit consumers – Efficiencies allow company to deliver a better product over time with greater programming options to current and future subscribers

Anticipate working closely with regulators – We have reviewed the regulatory aspects of this transaction and expect to secure approval and close the transaction in a timely fashion

26 Enhanced Competitiveness in Rapidly Evolving Audio Entertainment Marketplace

Licenses Granted – 1997 Expanding Environment – 2007

27 Putting Satellite Radio in Context

MM of Units 250 237 230 223 219

200

150

100

50 39 14

0 (1) (2) (5) Vehicles PCs AM/FM Radio Wireless iPods SIRIUS/XM (3) (4) (6) Listeners Subs Subs (1) US motor-vehicle registrations excluding buses as of 2005; Source: Bureau of Transportation Statistics (2) US PCs in use as of 2005; Source: Computer Industry Almanac (3) US weekly AM/FM radio listeners (12+); Source: Arbitron Radio Today, 2006 Edition (4) US wireless subs as of 6/30/06; Source: CTIA (5) Global iPod units sold in 2006; Source: Wall Street Research (6) Satellite radio subscribers; Source: Company estimates

28 Roadmap to Completion

Event Expected Timeline

9 Execute definitive agreement 9 Completed

SIRIUS/XM shareholder votes 4 – 6 months

Receive regulatory approvals Approximately 9 months

Close transaction Anticipated end of 2007

29 Best Audio Programming on Air

Exclusive Premium Commercial-Free Content Branded Content Music

Christian Classical Country Howard Stern Dance Latin Decades Electronic Oprah and Friends Hip-Hop/R&B Hits Jazz & Blues Martha Stewart Kids Lifestyle Pop Rock Bob Dylan World

30 Questions & Answers

31 FOR IMMEDIATE RELEASE AT MONDAY, MARCH 24, 2008 (202) 514-2007 WWW.USDOJ.GOV TDD (202) 514-1888

STATEMENT OF THE DEPARTMENT OF JUSTICE ANTITRUST DIVISION ON ITS DECISION TO CLOSE ITS INVESTIGATION OF XM SATELLITE RADIO HOLDINGS INC.’S MERGER WITH SIRIUS SATELLITE RADIO INC.

Evidence Does Not Establish that Combination of Satellite Radio Providers Would Substantially Reduce Competition

WASHINGTON — The Department of Justice’s Antitrust Division issued the following statement today after announcing the closing of its investigation into the proposed merger of XM Satellite Radio Holdings Inc. with Sirius Satellite Radio Inc.:

“After a careful and thorough review of the proposed transaction, the Division concluded that the evidence does not demonstrate that the proposed merger of XM and Sirius is likely to substantially lessen competition, and that the transaction therefore is not likely to harm consumers. The Division reached this conclusion because the evidence did not show that the merger would enable the parties to profitably increase prices to satellite radio customers for several reasons, including: a lack of competition between the parties in important segments even without the merger; the competitive alternative services available to consumers; technological change that is expected to make those alternatives increasingly attractive over time; and efficiencies likely to flow from the transaction that could benefit consumers.

“The Division’s investigation indicated that the parties are not likely to compete with respect to many segments of the satellite radio business even in the absence of the merger. Because customers must acquire equipment that is specialized to the satellite radio service to which they subscribe, and which cannot receive the other provider’s signal, there has never been significant competition for customers who have already subscribed to one or the other service. For potential new subscribers, past competition has resulted in XM and Sirius entering long- term, sole-source contracts that provide incentives to all of the major auto manufacturers to install their radios in new vehicles. The car manufacturer channel accounts for a large and growing share of all satellite radio sales; yet, as a result of these contracts, there is not likely to be significant further competition between the parties for satellite radio equipment and service sold through this channel for many years. In the retail channel, where the parties likely would continue to compete to attract new subscribers absent the merger, the Division found that the evidence did not support defining a market limited to the two satellite radio firms that would exclude various alternative sources for audio entertainment, and similarly did not establish that the combined firm could profitably sustain an increased price to satellite radio consumers. Substantial cost savings likely to flow from the transaction also undermined any inference of

32 - 2 - competitive harm. Finally, the likely evolution of technology in the future, including the expected introduction in the next several years of mobile broadband Internet devices, made it even more unlikely that the transaction would harm consumers in the longer term. Accordingly, the Division has closed its investigation of the proposed merger.”

ANALYSIS

During the course of its investigation, the Division reviewed millions of pages of documents, analyzed large amounts of data related to sales of satellite radios and subscriptions for satellite radio service, and interviewed scores of industry participants.

Extent of Likely Future Competition between XM and Sirius

The Division’s analysis considered the extent to which the two satellite radio providers compete with one another. Although the firms in the past competed to attract new subscribers, there has never been significant competition between them for customers who have already subscribed to one or the other service and purchased the requisite equipment. Also, competition for new subscribers is likely to be substantially more limited in the future than it was in the past.

As to existing subscribers, the Division found that satellite radio equipment sold by each company is customized to each network and will not function with the other service. XM and Sirius made some efforts to develop an interoperable radio capable of receiving both sets of satellite signals. Depending on how such a radio would be configured, it could enable consumers to switch between providers without incurring the costs of new equipment. The Division’s investigation revealed, however, that no such interoperable radio is on the market and that such a radio likely would not be introduced in the near term. For example, in the important automotive channel, such a radio could not be introduced in the near term due to the engineering required to integrate radios into new vehicles. The need for equipment customized to each network means that in order to switch from XM to Sirius, or vice versa, a subscriber would have to purchase new equipment designed for the other service. In the case of a factory-installed car radio, switching satellite radio providers would have the additional disadvantage of requiring an aftermarket radio that would be less integrated into the vehicle’s systems. Data analyzed by the Division confirmed that subscribers rarely switch between XM and Sirius.

As to new subscribers, XM and Sirius sell satellite radios and service primarily through two distribution channels: (1) car manufacturers that install the equipment in new cars and (2) mass-market retailers that sell automobile aftermarket equipment and other stand-alone equipment. Car manufacturers account for an increasingly large portion of XM and Sirius sales, and the parties have focused more and more of their resources on attracting subscribers through the car manufacturer channel. Historically, XM and Sirius engaged in head-to-head competition for the right to distribute their products and services through each car company. As a result of this competitive process, XM and Sirius have provided car manufacturers with subsidies and other payments that indirectly reduce the equipment prices paid by car buyers to obtain a satellite radio. However, XM and Sirius have entered into sole-source contracts with all the major automobile manufacturers that fix the amount of these subsidies and other pertinent terms

33 - 3 -

through 2012 or beyond. Moreover, there was no evidence that competition between XM or Sirius beyond the terms of these contracts would affect customers’ choices of which car to buy. As a result, there is not likely to be significant competition between XM and Sirius for satellite radio equipment and service sold through the car manufacturer channel for many years.

The Division’s investigation identified the mass-market retail channel as an arena in which XM and Sirius would compete with one another for the foreseeable future. Both XM and Sirius devote substantial effort and expense to attracting subscribers in this arena, with both companies offering discounts, most commonly in the form of equipment rebates, to attract consumers. Retail channel sales have dropped significantly since 2005, and the parties contended that the decline was accelerating. However, retail outlets still account for a large portion of the firms’ sales, and the Division was unable to determine with any certainty that this channel would not continue to be important in the future.

Effect on Competition in the Retail Channel

Because XM and Sirius would no longer compete with one another in the retail channel following the merger, the Division examined what alternatives, if any, were available to consumers interested in purchasing satellite radio service, and specifically whether the relevant market was limited to the two satellite radio providers, such that their combination would create a monopoly. The parties contended that they compete with a variety of other sources of audio entertainment, including traditional AM/FM radio, HD Radio, MP3 players (e.g., iPods®), and audio offerings delivered through wireless telephones. Those options, used individually or in combination, offer many consumers attributes of satellite radio service that they may find attractive. The parties further contended that these audio entertainment alternatives were sufficient to prevent the merged company from profitably raising prices to consumers in the retail channel – for example, through less discounting of equipment prices, increased subscription prices, or reductions in the quality of equipment or service.

The Division found that evidence developed in the investigation did not support defining a market limited to the two satellite radio firms, and similarly did not establish that the combined firm could profitably sustain an increased price to satellite radio consumers. XM and Sirius seek to attract subscribers in a wide variety of ways, including by offering commercial-free music (with digital sound quality), exclusive programming (such as Howard Stern on Sirius and “Oprah & Friends” on XM), niche music formats, out-of-market sporting events, and a variety of news and talk formats in a service that is accessible nationwide. The variety of these offerings reflects an effort to attract consumers with highly differentiated interests and tastes. Thus, while the satellite radio offerings of XM and Sirius likely are the closest substitutes for some current or potential customers, the two offerings do not appear to be the closest substitutes for other current or potential customers. For example, a potential customer considering purchasing XM service primarily to listen to Major League Baseball games or one considering purchasing Sirius service primarily to listen to Howard Stern may not view the other satellite radio service, which lacks the desired content, as a particularly close substitute. Similarly, many customers buying radios in the retail channel are acquiring an additional receiver to add to an existing XM or Sirius subscription for their car radio, and these customers likely would not respond to a price increase

34 - 4 - by choosing a radio linked to the other satellite radio provider. The evidence did not demonstrate that the number of current or potential customers that view XM and Sirius as the closest alternatives is large enough to make a price increase profitable. Importantly in this regard, the parties do not appear to have the ability to identify and price discriminate against those actual or potential customers that view XM and Sirius as the closest substitutes.

Likely Efficiencies

To the extent there were some concern that the combined firm might be able profitably to increase prices in the mass-market retail channel, efficiencies flowing from the transaction likely would undermine any such concern. The Division’s investigation confirmed that the parties are likely to realize significant variable and fixed cost savings through the merger. It was not possible to estimate the magnitude of the efficiencies with precision due to the lack of evidentiary support provided by XM and Sirius, and many of the efficiencies claimed by the parties were not credited or were discounted because they did not reflect improvements in economic welfare, could have been achieved without the proposed transaction, or were not likely to be realized within the next several years. Nevertheless, the Division estimated the likely variable cost savings – those savings most likely to be passed on to consumers in the form of lower prices – to be substantial. For example, the merger is likely to allow the parties to consolidate development, production and distribution efforts on a single line of radios and thereby eliminate duplicative costs and realize economies of scale. These efficiencies alone likely would be sufficient to undermine an inference of competitive harm.

Effect of Technological Change

Any inference of a competitive concern was further limited by the fact that a number of technology platforms are under development that are likely to offer new or improved alternatives to satellite radio. Most notable is the expected introduction within several years of next- generation wireless networks capable of streaming Internet radio to mobile devices. While it is difficult to predict which of these alternatives will be successful and the precise timing of their availability as an attractive alternative, a significant number of consumers in the future are likely to consider one or more of these platforms as an attractive alternative to satellite radio. The likely evolution of technology played an important role in the Division’s assessment of competitive effects in the longer term because, for example, consumers are likely to have access to new alternatives, including mobile broadband Internet devices, by the time the current long- term contracts between the parties and car manufacturers expire.

The Division’s Closing Statement Policy

The Division provides this statement under its policy of issuing statements concerning the closing of investigations in appropriate cases. This statement is limited by the Division’s

35 - 5 - obligation to protect the confidentiality of certain information obtained in its investigations. As in most of its investigations, the Division’s evaluation has been highly fact-specific, and many of the relevant underlying facts are not public. Consequently, readers should not draw overly broad conclusions regarding how the Division is likely in the future to analyze other collaborations or activities, or transactions involving particular firms. Enforcement decisions are made on a case-by-case basis, and the analysis and conclusions discussed in this statement do not bind the Division in any future enforcement actions. Guidance on the Division’s policy regarding closing statements is available at: http://www.usdoj.gov/atr/public/guidelines/201888.htm.

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08-226

36 News media Information 202 / 418-0500 Fax-On-Demand 202 / 418-2830 TTY 202/418-2555 Internet: http://www.fcc.gov NEWS ftp.fcc.gov Federal Communications Commission 445 12th Street, S.W. Washington, D. C. 20554 This is an unofficial announcement of Commission action. Release of the full text of a Commission order constitutes official action. See MCI v. FCC. 515 F 2d 385 (D.C. Circ 1974). FOR IMMEDIATE RELEASE Contact: Robert Kenny July 28, 2008 (202) 418-2668

COMMISSION APPROVES TRANSACTION BETWEEN SIRIUS SATELLITE RADIO HOLDINGS INC. AND XM SATELLITE RADIO HOLDINGS, INC. SUBJECT TO CONDITIONS

On July 25, 2008, the Commission voted to approve the application of Sirius Satellite Radio Inc. (“Sirius”) and XM Satellite Radio Holdings Inc. (“XM”; jointly, the “Applicants”) to transfer control of the licenses and authorizations held by Sirius and XM and their subsidiaries for the provision of satellite digital audio radio service (or “SDARS”) in the United States. The Commission found that grant of the application, with the voluntary commitments made by the Applicants and other conditions, is in the public interest. The transaction will benefit consumers by making available to them a wider array of programming choices at various price points and by affording them greater choice and control over the programming to which they subscribe. Highlights of the Commission’s action are noted below, followed by details concerning the grant of the application and the separate resolution of certain enforcement matters. • After reviewing the empirical data available as part of its competitive analysis, the Commission determined there was insufficient evidence in the record to predict the likelihood of anticompetitive harms. It therefore evaluated the application under “worst- case” assumptions, i.e., that the relevant market is limited to SDARS. This approach permitted the Commission to protect consumers from potential adverse effects of the transaction while also allowing the Commission to balance potential harms against potential public interest benefits. The Commission concluded that the merger, absent the Applicants’ voluntary commitments and other conditions, would result in potential harms. With those commitments and conditions to mitigate the harms, however, the Commission found the transaction to be in the public interest. All of the voluntary commitments must continue in effect at least three years after consummation of the merger. • The Commission accepted the Applicants’ voluntary commitments to: o Cap prices for 36 months after consummation of the transaction, subject to certain cost pass-throughs after one year. In addition, six months prior to the end of commitment period, the Commission will seek public comment on whether the cap continues to be necessary in the public interest and will determine whether it should be extended, removed, or modified. The merger approval is conditioned on the Commission’s ability to modify or extend the price cap beyond the three-year commitment period. o Offer to consumers, within three months of consummation of the transaction, the ability to receive a number of new programming packages, including the ability to select programming on an a la carte basis. o Make available 4 percent of its capacity for use by certain Qualified Entities, and an additional 4 percent of capacity for the delivery of noncommercial educational or 37 informational (“NCE”) programming, which will enhance the diversity of programming available to consumers. o Offer interoperable receivers in the “retail after-market,” i.e., receivers available at retail outlets for installation in consumers’ automobiles or homes, within nine months of consummation of the merger. o Refrain from entering into any agreement that would grant an equipment manufacturer an exclusive right to manufacture, market, and sell SDARS receivers. Applicants also commit to refrain from barring any manufacturer from including in any receiver non-interfering hybrid digital terrestrial radio functionality, iPod compatibility, or other audio technology. In addition, Applicants commit to make available the intellectual property needed to allow any device manufacturer to develop equipment that can deliver SDARS. o File the applications needed to provide Sirius satellite service to Puerto Rico via terrestrial repeaters within three months of the consummation of the merger. • Although the Commission found it unnecessary to impose a condition requiring the inclusion of hybrid digital radio technology in SDARS receivers, it recognized that important questions have been raised about hybrid digital radio that warrant further examination in a separate proceeding. The Commission therefore committed to initiating a notice of inquiry within 30 days after adoption of the merger order to gather additional information on the issues. • The Commission reiterated that SDARS licensees are already prohibited, independent of the merger, from using terrestrial repeaters to distribute local content—including both programming and advertising—that is distinct from that provided to subscribers nationwide via satellite. • The Commission prohibited the merged entity from entering into agreements that would bar any terrestrial radio station from broadcasting live local sporting events. • Concurrent with grant of the application, the Commission repealed the prohibition on the merger of the two SDARS service providers as set forth in the 1997 SDARS Report and Order.1 For the same reasons that it approved the merger, the Commission concluded that repeal of the rule prohibiting the merger will, on balance, serve the public interest. • In separate actions on July 25, 2008, the Commission approved Consent Decrees between it and each of the Applicants. The Consent Decrees terminated the Commission’s investigations into the Applicants’ compliance with the FCC regulations governing FM modulators and terrestrial repeaters. They provide that XM and Sirius will voluntarily contribute approximately $17.4 million and $2.2 million, respectively, to the U.S. Treasury and take additional remedial measures.

Action by the Commission, July 25, 2008, by Memorandum Opinion and Order and Report and Order (MB Docket No. 07-57, FCC 08-178). Commissioners Copps and Adelstein dissenting

1 Establishment of Rules and Policies for the Digital Audio Radio Satellite Service in the 2310-2360 MHz Frequency Band, 12 FCC Rcd 5754, 5823 ¶ 170 (1997). As described in the Order in further detail, the repeal of this rule was effective on adoption of the Order. 2 38 and issuing separate statements. Chairman Martin, Commissioners Tate and McDowell issuing separate statements.

Media Bureau contacts: Marcia Glauberman, (202) 418-7046, and Rebekah Goodheart, (202) 418-1438

-FCC-

3 39 APPENDIX

The Applicants’ voluntary commitments and other conditions imposed by the Commission are summarized below. They are fully enforceable by the Commission and must continue in effect for a period of no less than three years after consummation of the merger.

Price Cap The combined company shall not raise the retail prices for its basic $12.95 per month subscription package, the a la carte programming packages, and the new programming packages nor reduce the number of channels in either their current packages or new packages for at least 36 months. After the first anniversary of the consummation of the merger, the combined company may pass through cost increases incurred since the filing of the combined company’s FCC merger application as a result of statutorily or contractually required payments to the music, recording, and publishing industries for the performance of musical works and sound recordings or for device recording fees. Six months prior to the expiration of the commitment period, the Commission will seek public comment on whether the cap continues to be necessary in the public interest.

New Programming Packages and A La Carte Options Within three months of consummation of the merger:

• The first a la carte-capable radios must be introduced in the retail after-market, and the combined company must begin offering a la carte programming.

• The combined company must offer customers the ability to obtain on existing receivers “best of” packages that provide both Sirius and XM programming, as selected by the merged company, at a monthly cost of $16.99.

• Customers must have the option of choosing a package of “mostly music” programming and a package of news, sports and talk programming at a monthly cost of $9.99 for each option.

• Consumers must be able to purchase a “family-friendly” version of existing Sirius or XM programming at a cost of $11.95 a month, representing a credit of $1.00 per month. Current Sirius customers must also be able to choose a family-friendly version of Sirius programming that includes select XM programming, and current XM customers must be able to choose a family-friendly XM programming option that includes select Sirius programming. This programming will cost $14.99 per month, representing a credit of $2.00 per month from the cost of the “best of” programming.

Interoperable Radio Receivers The Commission required the combined company to offer for sale an interoperable receiver in the retail after-market within nine months of consummation of the merger.

4 40 Open Access and Hybrid Digital Radio Notice of Inquiry The merged entity, immediately upon consummation of the merger, will permit any device manufacturer to develop equipment that can deliver the combined company’s satellite radio service. Device manufacturers also must be permitted to incorporate in satellite radio receivers any other technology that would not result in harmful interference with the merged entity’s network. The merged entity may not prevent such devices from reaching consumers through exclusive contracts or otherwise. Sirius and XM shall provide, on commercially reasonable terms, the intellectual property to permit any device manufacturer to develop equipment that can deliver the merged entity’s satellite radio service. The encryption, conditional access, and security technology is embedded in chip sets that can be purchased from third-party manufacturers.

Third-Party Access to SDARS Capacity Within four months of consummation of the merger, the merged entity will enter into long-term leases or other agreements to provide a Qualified Entity or Entities rights to four percent of the full-time audio channels on the Sirius platform and on the XM platform, respectively, which currently represents six channels on the Sirius platform and six channels on the XM platform.

Reservation of Channels for Noncommercial Educational Use Upon consummation, the combined company must make available four percent of the full-time audio channels on the Sirius platform and on the XM platform, respectively, which currently represents six channels on the Sirius platform and six channels on the XM platform, for NCE programming. Programming provided pursuant to this set-aside requirement must be available to the public no later than six months after the transaction’s consummation. In fulfilling this commitment, the combined company shall adhere to the additional requirements set forth in the merger order, including a limitation of one NCE channel per programmer as long as demand for such channels exceeds available supply. The merger order applies to the merged entity the rules governing Direct Broadcast Satellite (“DBS”) providers’ carriage of noncommercial educational or informational programming set forth in section 25.701(f) of the Commission’s rules, 47 C.F.R. § 25.701(f).

Service to Puerto Rico Within three months of consummation of the merger, the combined company must file applications with the Commission to provide the Sirius satellite radio service to the Commonwealth of Puerto Rico using terrestrial repeaters and must promptly introduce such service upon grant of permanent authority by the Commission to operate these repeaters.

Local Programming and Local Advertising The Commission reiterated that SDARS licensees are already prohibited from using terrestrial repeaters to distribute localized programming and advertising. In addition, considering the importance of local sports programming to terrestrial radio stations, the Commission 5 41 prohibited the merged entity from entering into any agreements that would preclude any terrestrial radio station from broadcasting live local sporting events.

1997 SDARS Report & Order

When the Commission established SDARS in 1997, it stated that one SDARS licensee could not acquire control of the other SDARS license. The Commission sought comment on whether its language constituted a binding Commission rule and, if so, whether the Commission should waive, modify, or repeal the prohibition in the event it determined that the proposed merger would serve the public interest. The Commission found that the prohibition is a binding substantive rule, not a mere statement of policy. The Commission can repeal a rule if it decides that doing so would serve the public interest and it complies with rulemaking procedures. For the same reasons that it concluded that the grant of the merger, as conditioned, will serve the public interest, it concluded that repeal of the rule prohibiting the merger will, on balance, serve the public interest.

The Commission’s repeal of the merger prohibition and its approval of the merger, with the voluntary commitments and other conditions, were effective on July 25, upon adoption of the order repealing the prohibition and approving the merger. The Commission concluded that the repeal of the merger prohibition is a rule of particular applicability that is not subject to the Administrative Procedure Act’s publication requirement and therefore could be effective upon adoption of the order. The Commission also concluded that the prohibition’s repeal is not subject to the statutory 30-day waiting period under the Administrative Procedure Act because it relieves a restriction. In addition, the Congressional review procedures of Subtitle E of the Small Business Regulatory Enforcement Fairness Act of 1996 do not apply because repeal of the merger prohibition is not a “rule” within the meaning of the statutory provisions governing Congressional review of agency rulemaking, which exclude from the definition of the term “rule” “any rule of particular applicability,” including a rule that approves a merger.

EEO Obligations The Commission clarified in the Order that the merged entity must comply with the Commission’s equal employment opportunity rules and policies for broadcasters, including periodic submissions to the Commission consistent with the broadcast reporting schedule.

6 42 SIRIUS and XM Complete Merger

SIRIUS XM Radio Chosen as New Corporate Name Combined Company Has Over 18.5 Million Subscribers, Annualized Second Quarter Revenue Exceeding $2.4 Billion Company to Offer Consumers Best of Both Services, While Maximizing Significant Efficiencies SIRIUS XM Reiterates Financial Guidance; Expects 2009 Synergies of $400 million and 2009 Adjusted EBITDA of over $300 Million

NEW YORK, July 29, 2008 /PRNewswire-FirstCall via COMTEX News Network/ -- SIRIUS Satellite Radio (Nasdaq: SIRI) and XM Satellite Radio today announced that they have completed their merger, resulting in the nation's premier radio company. The new company plans to change its corporate name to SIRIUS XM Radio Inc. The combined company's stock will continue to be traded on the Nasdaq Global Select Market under the symbol "SIRI."

SIRIUS XM Radio begins day one with over 18.5 million subscribers, making it the second-largest radio company, based upon revenue, in the country; and, based upon subscribers, the second largest subscription media business in the U.S. With under 10% penetration of the home and car market, the opportunity for continued growth is significant.

"I am delighted to announce the completion of this exciting merger between SIRIUS and XM," said Mel Karmazin, CEO of SIRIUS XM Radio. "We have worked diligently to close this transaction and we look forward to integrating our best-in-class management teams and operations so we can begin delivering on our promise of more choices and lower prices for subscribers."

"Every one of our constituencies is a winner. Combined, SIRIUS XM Radio will deliver superior value to our shareholders. By offering more compelling packages and the best content in audio entertainment, we are well positioned for increased subscriber growth. Our laser focus on subscribers will continue and listeners can be assured that there will be no disruption in service. We also believe that the completion of the merger will eliminate any confusion that has been lingering in the marketplace," added Karmazin.

XM shareholders will receive 4.6 shares of SIRIUS common stock for each share of XM.

Competitive New Options for Consumers

SIRIUS XM Radio broadcasts more than 300 channels of programming, including exclusive radio offerings from Howard Stern, Oprah, Opie & Anthony and Martha Stewart, among others. SIRIUS XM Radio will offer these expanded options to consumers through arrangements with the world's leading automakers and its relationships with nationwide retailers.

As a result of the merger, SIRIUS XM Radio will also be able to offer consumers new packages in audio entertainment, including the first-ever a la carte programming option in subscription media. In addition to two a la carte options, the new packages will include: "Best of Both," giving subscribers the option to access certain programming from the other network; discounted Family Friendly packages; and tailored packages including "Mostly Music" and "News, Talk and Sports." The first of the new packages will be available in the early Fall.

"One of the most exciting benefits of this transaction is the ability to offer subscribers the option of expanding their subscriptions to include the Best of Both services. Given the respective popularity of exclusive programming on both SIRIUS and XM, we expect many subscribers will upgrade their current subscription," said Karmazin.

"The upside potential for both consumers and shareholders is huge. Consumers have the ease of adding premier programming without purchasing a new device. For shareholders, this kind of organic growth is a key part of the company's future and the success we expect to see," said Karmazin.

As promised when the merger was first announced, existing radios will continue to work and every subscriber has the option of maintaining their current service package.

Benefits for Shareholders Begin Immediately, Integration Already Under Way

SIRIUS XM Radio expects to begin realizing the synergies expected from this transaction immediately.

"In addition to realizing significant potential revenue growth, the management team will move quickly to capitalize on the synergies that many analysts have predicted for this combination. We expect to begin achieving those synergies without 43 sacrificing any of the world-class programming and marketing we are known for," said Karmazin.

The company today also reiterated guidance for the combined SIRIUS XM Radio. Based upon a preliminary analysis, the combined company expects to realize total synergies, net of the costs to achieve such synergies, of approximately $400 million in 2009; to post adjusted EBITDA exceeding $300 million in 2009; and to achieve positive free cash flow, before satellite capital expenditures, for the full year 2009. The company also expects that both synergies and adjusted EBITDA will continue growing beyond 2009.

"We have all the tools necessary to begin executing as a combined company with high aspirations for subscriber growth and greater financial performance in part from the significant synergies that we begin realizing literally today -- on Day One. We are moving quickly to integrate the operations," said Karmazin.

The corporate headquarters will be located in New York, NY and XM Satellite Radio, the company's wholly-owned subsidiary, will remain headquartered in Washington, DC.

Effective after the close of the market yesterday, trading in XMSR common stock on the Nasdaq Global Select Market ceased.

About SIRIUS XM Radio

SIRIUS XM Radio is America's satellite radio company delivering the "The Best Radio on Radio" to more than 18 million subscribers, including 100% commercial free music, and premier sports, news, talk, entertainment, traffic and weather.

SIRIUS XM Radio has exclusive content relationships with an array of personalities and artists, including Howard Stern, Oprah, Martha Stewart, Jimmy Buffett, Elvis, Jamie Foxx, Barbara Walters, Frank Sinatra, Opie & Anthony, The Grateful Dead, Willie Nelson, Bob Dylan, Dale Earnhardt Jr., Tom Petty, and Bob Edwards. SIRIUS XM Radio is the leader in sports programming as the Official Satellite Radio Partner of the NFL, Major League Baseball, NASCAR, NHL, and PGA, and broadcasts major college sports.

SIRIUS XM Radio has exclusive arrangements with every major automaker. SIRIUS XM Radio products are available at shop.sirius.com and shop.xmradio.com, and at retail locations nationwide, including Best Buy, Circuit City, RadioShack, Target, Sam's Club, and Wal-Mart.

SIRIUS XM Radio also offers SIRIUS Backseat TV, the first ever live in-vehicle rear seat entertainment featuring Nickelodeon, Disney Channel and Cartoon Network; XM NavTraffic service for GPS navigation systems delivers real-time traffic information, including accidents and road construction, for more than 80 North American markets.

The guidance contained herein are based upon a number of assumptions and estimates that, while considered reasonable by us when taken as a whole, are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. In addition, the guidance is based upon specific assumptions with respect to future business conditions, some or all of which will change. The guidance, like any forecast, is necessarily speculative in nature and it can be expected that the assumptions upon which the guidance is based will not prove to be valid or will vary from actual results. Actual results will vary from the guidance and the variations may be material. Consequently, the guidance should not be regarded as a representation by SIRIUS or any other person that the synergies, adjusted EBITDA and free cash flow will actually be achieved. You are cautioned not to place undue reliance on this information.

This communication contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements about the benefits of the business combination transaction involving SIRIUS Satellite Radio Inc. and XM Satellite Radio Holdings Inc., including potential synergies and cost savings and the timing thereof, future financial and operating results, the combined company's plans, objectives, expectations and intentions with respect to future operations, products and services; and other statements identified by words such as "anticipate," "believe," "plan," "estimate," "expect," "intend," "will," "should," "may," or words of similar meaning. Such forward- looking statements are based upon the current beliefs and expectations of SIRIUS' and XM's management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are difficult to predict and generally beyond the control of SIRIUS and XM. Actual results may differ materially from the results anticipated in these forward-looking statements.

The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statement: general business and economic conditions; the performance of financial markets and interest rates; the ability to obtain governmental approvals of the transaction on a timely basis; the failure to realize synergies and cost-savings from the transaction or delay in realization thereof; the businesses of SIRIUS and XM may not be combined successfully, or such combination may take longer, be more difficult, time-consuming or costly to accomplish than expected; and operating costs and business disruption following the merger, including adverse effects on employee retention and on our business relationships with third parties, including manufacturers of radios, retailers, automakers and 44 programming providers. Additional factors that could cause SIRIUS' and XM's results to differ materially from those described in the forward-looking statements can be found in SIRIUS' and XM's Annual Reports on Form 10-K for the year ended December 31, 2007, which are filed with the Securities and Exchange Commission (the "SEC") and available at the SEC's Internet site (http://www.sec.gov). The information set forth herein speaks only as of the date hereof, and SIRIUS and XM disclaim any intention or obligation to update any forward looking statements as a result of developments occurring after the date of this communication.

G-SIRI

SOURCE SIRIUS Satellite Radio; XM Satellite Radio http://www.shop.sirius.com

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