Financially Speaking… Numerex Corp…

Numerex Corp. (Nasdaq: NMRX) has reduced its outstanding debt associated with the financings in May 2006 and December 2006.

The Company repaid $2 million in cash on the secured non-convertible term note and converted $1 million of outstanding debt into equity under the secured convertible term note. The Company will issue an aggregate of 226,244 shares of our Class A Common Stock in connection with this conversion on July 28, 2009. The Company’s total debt level now stands at $6.0 million after this reduction. Alan Catherall, Chief Financial Officer of Numerex Corp. stated, “We are pleased by this transaction and, in particular, I want to highlight two specific benefits to Numerex. First, this is an accretive transaction. The savings in interest expense, which will be reduced by one third, will more than compensate for the newly issued shares and the negligible opportunity cost from forgiven interest income. In addition, neither financing included any pre-payment penalties. Second, our total debt level has been significantly reduced from $9.0 million to $6.0 million. Since part of the debt was converted into equity, this was achieved by using only $2 million in cash. After this repayment and going forward, we expect to remain in a sound liquidity position to finance our growth.” In connection with the conversion, Numerex will also be writing-off all unamortized financing costs related to the debt reduction. This non-cash expense is approximately $160,000.