Sirius XM Radio (SIRI)

      During the six months ended June 30, 2005, we granted 1,107,467 non-qualified stock options at fair market value on the date of grant with an average exercise price of $5.42 per share.

      We recorded additional deferred compensation of $207 during the six months ended June 30, 2005 in connection with stock options granted. As of June 30, 2005 and December 31, 2004, we had $4,179 and $7,363, respectively, of deferred compensation in connection with stock options granted to employees below fair market value at the date of grant and stock options granted to members of our board of directors. Such deferred compensation is being amortized to expense over the vesting period. We also record expense for stock options granted to consultants based on fair value at the date of grant as determined in accordance with SFAS No. 123. We recognized stock compensation expense associated with stock options of $4,578 and $2,810 for the three months ended June 30, 2005 and 2004, respectively, and $8,708 and $7,314 for the six months ended June 30, 2005 and 2004, respectively. Stock compensation expense associated with stock options for the three and six months ended June 30, 2005 includes a charge of $479 for an employee that was deemed to benefit from the modification of a stock-based award resulting in a new measurement date. Expense associated with stock options is recorded as a component of equity granted to third parties and employees in our accompanying unaudited consolidated statements of operations.

Stock Options