1116317--2/28/2008--XM_SATELLITE_RADIO_HOLDINGS

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In connection with the merger, a substantial amount of our indebtedness will need to be refinanced. The combined company s indebtedness following the completion of the merger will be substantial. This indebtedness could adversely affect the combined company in many ways, including by reducing funds available for other business purposes. The ability to complete the merger is subject to the receipt of consents and approvals from government entities, which may impose conditions that could have an adverse effect on us or could cause either party to abandon the merger. Any delay in completion of the merger may significantly reduce the benefits expected to be obtained from the merger. The anticipated benefits of the merger may not be realized fully or at all or may take longer to realize than expected. Failure to complete the merger for regulatory or other reasons could adversely affect our stock price and our future business and financial results. Uncertainty about the merger and diversion of management could harm us, whether or not the merger is completed. You could lose money on your investment because our expenses exceed our revenues. Our cumulative expenditures and losses have been significant and are expected to grow. Demand for our service may be insufficient for us to become profitable. We may need additional funding for our business plan and additional financing might not be available. The unfavorable outcome of pending or future litigation or investigations could have a material adverse effect on us. Large payment obligations under our agreements with General Motors and other automobile manufacturers, suppliers of programming and others may prevent us from becoming profitable. We must maintain and pay license fees for music rights, and we may have disputes with copyright holders. Our inability to retain customers, including those who purchase or lease vehicles that include a subscription to our service, could adversely affect our financial performance. Loss or premature degradation of our existing satellites could damage our business. Potential losses may not be covered by insurance. Competition could adversely affect our revenues. Rapid technological and industry changes could make our service obsolete. Higher than expected subscriber acquisition costs could adversely affect our financial performance. Our business could be adversely affected by the performance of our business partners. Failure to comply with FCC requirements could damage our business. The FCC has not issued final rules authorizing terrestrial repeaters. One of our major business partners is experiencing financial difficulties. Our substantial indebtedness could adversely affect our financial health, which could reduce the value of our securities. Weaker than expected market and advertiser acceptance of our XM Radio service could adversely affect our advertising revenue and results of operations. Our business may be impaired by third party intellectual property rights. Interference from other users could damage our business. Our service network or other ground facilities could be damaged by natural catastrophes. Consumers could steal our service. We need to obtain rights to programming, which are expensive and could be more costly than anticipated. We depend on certain on-air talent and other people with special skills. If we cannot retain these people, our business could suffer. The market price of our securities could be hurt by substantial price and volume fluctuations. Future issuances or sales of our Class A common stock could lower our stock price or impair our ability to raise funds in new stock offerings. It may be hard for a third party to acquire us, and this could depress our stock price.

Full 10-K form ▸

1116317--2/28/2008--XM_SATELLITE_RADIO_HOLDINGS_INC