ALEXANDRIA, Va. — Metrocall Inc. said Thursday it has negotiated with its creditors to create a plan of reorganization to submit when it files for Chapter 11 bankruptcy protection.
The Alexandria-based paging and wireless messaging company said it has signed agreements with the lender backing its $133 million line of credit and a group of holders of its unsecured debt. The agreements "establish the terms and conditions of a pre-negotiated plan of reorganization soon to be proposed and implemented through a Chapter 11 filing under the United States Bankruptcy Code," the company said in a news release.
Metrocall announced in April that it expected to file for Chapter 11 protection, although it did not specify a date.
Under the agreements announced Thursday, Metrocall will revamp its corporate structure and will issue various notes, voting rights and preferred shares in exchange for its current debt instruments.
According to Metrocall's most recent financial report to the Securities and Exchange Commission, the company had $759 million of long-term debt currently due as of March 31. On the same date, the company had negative shareholder equity of $821 million.
Metrocall has lost money in each of its past five fiscal years, most recently a $612 million loss in 2001 on total revenue of $503 million.