Metrocall completes redemption of $20 million of preferreds, calls remainder

New York, March 31 - Metrocall Holdings, Inc. said that it had completed the previously announced redemption of most of its outstanding series A preferred stock on previously outlined terms.

The company also said that it would redeem the remaining series A preferred shares on May 17 for about $11.13 per share, plus accrued and unpaid dividends of around 21 cents per share.

The company anticipates a total cost of about $6.8 million.

Upon that redemption, Metrocall will have retired all of the long-term debt incurred and preferred stock issued by the company under its 2002 Chapter 11 reorganization.

The company noted that the final installment of the $81.5 million principal amount of long-term debt incurred under its Chapter 11 plan was repaid on June 30, 2003 and, with the redemption on May 17, Metrocall will have redeemed all $60 million of the preferred stock originally issued under its Chapter 11 plan. The retirement of the preferred stock will fulfill one of Metrocall's obligations under its recently announced merger agreement with Arch Wireless, Inc. dated March 29.

As previously announced, Metrocall, an Alexandria, Va.-based paging and wireless messaging company, said on March 1 that it would redeem 1,797,103 shares of its outstanding series A preferred stock, or about 75% of the total outstanding amount, on March 31. It said the preferred shares would be redeemed at a price of $11.129028 per share, for total cost to the company of $20 million.

Metrocall said that following this redemption and taking into account previous redemptions it would have redeemed about 5.4 million shares, or 90% of the total 6 million series A preferred shares issued in connection with its Oct. 8, 2002 reorganization. The just completed transaction follows a $20 million redemption of series A preferreds completed on Sept. 30, 2003 and a subsequent $20 million redemption on Jan. 6.

The company said the March 31 voluntary redemption of shares would be completed using $20 million in cash balances generated from operations. It said shares would be redeemed on a pro rata basis from all holders of record as of March 1.

Metrocall estimated that following the redemption it would have about 605,000 shares of its series A preferred stock outstanding with a total liquidation preference of $6.7 million.

Besides its ongoing redemption of the series A preferred shares, Metrocall retired in full $81.5 million total amount of its long-term debt securities, which was completed on June 30, 2003.

The company said that upon the completion of the March 31 redemption, it would have retired $141.5 million, or 96% of the aggregate debt and preferred stock obligations associated with its October 2002 plan of reorganization, using cash generated from operations.

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