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Debt converted to equity, $200 million in new cash, current shareholders get diluted 92%.

Woah, ho! A whopping 92% dilution? And most of you guys thought this was a good investment?

Anyhow.... I've got to say, my biggest complaints about not investing in Sirius have vanished. While a 92% dilution certainly isn't good news for existing shareholders, the lack of debt and extra cash are absolutely imperative for the company just to survive. The likelihood of more share dilution is far less now than before this news was announced. Heck, I wouldn't be surprised if the price of Sirius went UP on the news, because now this company has a real fighting chance of a long and maybe even prosperous future.

I'm still not going to invest my money into a money-losing venture, and there are still risks involved. Even in that press release there's a great quote explaining the risks ahead: . The additional $200 million, combined with the approximately $240 million cash currently on-hand, is expected to give Sirius sufficient cash to operate into the second quarter of 2004, based upon its current business plan. Furthermore, the company continues to evaluate initiatives that could enable it to achieve cash flow breakeven without raising additional funds.

There's only enough cash to get through Q2 of 2004 before they'll have to start taking on debt again or dilute shares. And if XMSR continues to trounce SIRI with subscriber growth, this company may never reach profitability or may take much longer.

It's still risky, but this is a FAR better situation than before!

-- Ryan
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