Owning Sirius XM Radio (NASDAQ:SIRI) these days is like riding a wild rollercoaster. There are sharp ascents, steep drops, and gravity-flicking loops. Lots and lots of loops.

Shares this morning traded up as much as 71%, after the company announced that it had refinanced $172.5 million worth of debt, pushing out the maturity for another 18 months.

The bad news is that this is part of the $400 million debt due in December, not the $174.6 million that needs to be paid back next week. That deadline looms on Tuesday, and the company's fate is still up in the air.

"The Company is in discussions with others with respect to transactions that could refinance some of its and its subsidiaries' indebtedness," reads this morning's press release. "These transactions may not be successfully consummated. If these transactions are not consummated, it may be forced to file for bankruptcy protection as early as February 17, 2009."

Is that a warning to its shareowners, or a threat to its creditors?

Probably a bit of both, because even Sirius XM may not know how this will all pan out. EchoStar (NASDAQ:SATS) has been reportedly buying up chunks of the debt that is due on Tuesday, but no one knows whether it's coming in as friend or foe.

The important takeaway from this morning's debt exchange is that it does alleviate the burden of repayments facing Sirius XM this year. As of right now, the company's on the hook for the following:

  • $174.6 million due on Tuesday.
  • $350 million due in May, with JPMorgan Chase (NYSE:JPM) and UBS AG (NYSE:UBS) holding $100 million apiece.
  • $227.5 million that matures in December; it was $400 million before this morning's maneuver.

Today's move is moot if the company can't come up with the money or debt swaps it needs to cover its near-term obligations, of course.

The creditors swapping their December debt for senior secured notes due in June of 2011 were paid $5.07 million in cash -- and roughly 60 million shares of Sirius XM -- in the move. It's a decent deal for the creditors, who retain the principal that they are owned, pick up 60 million lottery tickets, and have a little money in their pockets. If Sirius XM files for bankruptcy, at least they know they got a little money today.

However, if Sirius XM is willing to give up so much in stock dilution, instead of just forking over the total compensation equivalent of $9.45 million in cash, that just confirms how tight money has become for Sirius.

Between now and Tuesday, either Sirius or its creditors will blink. CEO Mel Karmazin is unlikely to get a whole lot of sleep during the holiday weekend.

Throw those hands up, Mel, and enjoy the ride. There's no way to know which way this rollercoaster turns from here.

More news than static on Sirius XM:

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