McLeodUSA decides not to pay quarterly dividend on 6¾% convertibles

New York, Oct. 19 - McLeodUSA Inc. said it decided not to declare the quarterly dividend on its 6¾% series A cumulative convertible preferred stock that is payable Nov. 15. The dividend will continue to accumulate at the rate of 6¾% annually, McLeodUSA said.

The Cedar Rapids, Iowa-based competitive local exchange carrier said it has historically paid the dividend in shares of its class A common stock.

However at current prices McLeod said it would have had to issue more than seven million new shares compared to the 787,690 shares issued in the last quarter as the preferred dividend.

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