<PAGE>
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED OCTOBER 5, 1995
OFFER FOR ALL OUTSTANDING UNREGISTERED
11 7/8% SENIOR SUBORDINATED NOTES DUE 2005
($2,000,000 IN AGGREGATE PRINCIPAL AMOUNT)
IN EXCHANGE FOR REGISTERED
11 7/8% SENIOR SUBORDINATED NOTES DUE 2005
OF
PRONET INC.
May 17, 1996
THIS PROSPECTUS SUPPLEMENT SUPPLEMENTS THE PROSPECTUS DATED OCTOBER 5, 1995
(THE "PROSPECTUS") OF PRONET INC. (THE "COMPANY") RELATING TO THE OFFER BY THE
COMPANY TO EXCHANGE $1,000 PRINCIPAL AMOUNT OF ITS REGISTERED 11 7/8% SENIOR
SUBORDINATED NOTES DUE 2005 FOR EACH $1,000 PRINCIPAL AMOUNT OF ITS UNREGISTERED
11 7/8% SENIOR SUBORDINATED NOTES DUE 2005. CAPITALIZED TERMS USED IN THIS
PROSPECTUS SUPPLEMENT AND NOT OTHERWISE DEFINED HEREIN HAVE THE MEANING
SPECIFIED IN THE PROSPECTUS. THIS PROSPECTUS SUPPLEMENT IS DELIVERED TO THE
HOLDER OF OLD NOTES AND CONSTITUTES A RENEWED OFFER TO SUCH HOLDER TO EXCHANGE
OLD NOTES FOR NEW NOTES (THE "NEW EXCHANGE OFFER"). THIS PROSPECTUS SUPPLEMENT
SHOULD BE READ IN CONJUNCTION WITH THE PROSPECTUS, AND THIS PROSPECTUS
SUPPLEMENT IS QUALIFIED BY REFERENCE TO THE PROSPECTUS EXCEPT TO THE EXTENT THAT
THE INFORMATION CONTAINED HEREIN SUPERSEDES THE INFORMATION CONTAINED IN THE
PROSPECTUS. (THE TERMS "EXCHANGE OFFER" AND "LETTER OF TRANSMITTAL," AS THOSE
TERMS ARE DEFINED IN THE PROSPECTUS, SHALL INCLUDE THE TERMS "NEW EXCHANGE
OFFER" AND "NEW LETTER OF TRANSMITTAL" IN ALL RESPECTS EXCEPT AS SET FORTH IN
THIS PROSPECTUS SUPPLEMENT.)
TERMS OF THE NEW EXCHANGE OFFER
Upon the terms and subject to the conditions set forth in this Prospectus
Supplement, the Prospectus and in the Letter of Transmittal with respect to the
New Exchange Offer (the "New Letter of Transmittal"), the Company will accept
any and all Old Notes validly tendered and not withdrawn prior to 5:00 p.m., New
York City time, on the Expiration Date. The Company will issue $1,000 principal
amount of New Notes in exchange for each $1,000 principal amount of outstanding
Old Notes accepted in the New Exchange Offer. Holder may tender some or all of
its Old Notes pursuant to the New Exchange Offer. However, Old Notes may be
tendered only in integral multiples of $1,000 in principal amount.
The form and terms of New Notes are substantially the same as the form and
terms of Old Notes except that New Notes have been registered under the
Securities Act and will not bear legends restricting their transfer. The New
Notes will evidence the same debt as Old Notes and will be issued pursuant to,
and entitled to the benefits of, the Indenture pursuant to which Old Notes were,
and New Notes will be, issued.
As of the date of this Prospectus Supplement, $2,000,000 in aggregate
principal amount of Old Notes were outstanding. The Company has fixed the close
of business on May 16, 1996 as the record date for the New Exchange Offer for
purposes of determining the persons to whom the Prospectus, this Prospectus
Supplement and the New Letter of Transmittal, will initially be sent. As of
such date, there was one registered holder of Old Notes. The holder of Old
Notes does not have any appraisal or dissenters' rights under the General
Corporation Law of the State of Delaware or the Indenture in connection with the
New Exchange Offer. The Company intends to conduct the New Exchange Offer in
accordance with the applicable requirements of the Exchange Act and the rules
and regulations of the Commission promulgated thereunder.
<PAGE>
The Company shall be deemed to have accepted validly tendered Old Notes
when, as, and if the Company has given oral or written notice thereof to the
Exchange Agent. The Exchange Agent will act as agent for the tendering holder
for the purpose of receiving New Notes from the Company. If any tendered Old
Notes are not accepted for exchange because of an invalid tender, the occurrence
of certain other events set forth herein or otherwise, certificates for any such
unaccepted Old Notes will be returned, without expense, to the tendering holder
thereof as promptly as practicable after the Expiration Date.
A holder who tenders Old Notes in the Exchange Offer will not be required
to pay brokerage commissions or fees or, subject to the instructions in the New
Letter of Transmittal, transfer taxes with respect to the exchange of Old Notes
pursuant to the New Exchange Offer. The Company will pay all charges and
expenses, other than certain applicable taxes, in connection with the New
Exchange Offer. See "The Exchange Offer--Solicitation of Tenders; Fees and
Expenses."
EXPIRATION DATE; EXTENSIONS; AMENDMENTS
The term "Expiration Date" shall mean 5:00 p.m., New York City time, on
June 17, 1996, unless the Company, in its sole discretion, extends the New
Exchange Offer, in which case the term "Expiration Date" shall mean the latest
date and time to which the New Exchange Offer is extended. In order to extend
the New Exchange Offer, the Company will notify the Exchange Agent of any
extension by oral or written notice prior to 9:00 a.m., New York City time, on
the next business day after the previously scheduled Expiration Date. The
Company reserves the right, in its sole discretion, (i) to delay accepting any
Old Notes, to extend the New Exchange Offer or, if any of the conditions set
forth under "The Exchange Offer--Conditions" shall not have been satisfied, to
terminate the New Exchange Offer, by giving oral or written notice of such
delay, extension or termination to the Exchange Agent, or (ii) to amend the
terms of the New Exchange Offer in any manner.
NO WITHDRAWAL RIGHTS
Tenders of Old Notes may not be withdrawn.
CONDITIONS
Notwithstanding any other term of the New Exchange Offer, the Company shall
not be required to accept for exchange, or exchange New Notes for, any Old
Notes, and may terminate the New Exchange Offer as provided herein before the
acceptance of such Old Notes, if:
(a) the New Exchange Offer shall violate applicable law or any
applicable interpretation of the staff of the Commission; or
(b) any action or proceeding is instituted or threatened in any
court or by any governmental agency that might materially impair the
ability of the Company to proceed with the New Exchange Offer or any
material adverse development has occurred in any existing action or
proceeding with respect to the Company; or
(c) any development involving the Company has occurred that the
Company determines, in its sole discretion, makes it necessary under
law, and/or in the best interests of the Company's stockholders, to
terminate the New Exchange Offer; or
(d) any governmental approval has not been obtained, which
approval the Company shall deem necessary for the consummation of the
New Exchange Offer.
2
<PAGE>
If the Company determines in its sole discretion that any of the conditions
are not satisfied, the Company may (i) refuse to accept any Old Notes and return
all tendered Old Notes to the tendering holder (or, in the case of Old Notes
tendered by book-entry transfer into the Exchange Agent's account at the Book-
Entry Transfer Facility pursuant to the book-entry transfer procedures described
in the Prospectus, such Old Notes will be credited to an account maintained with
such Book-Entry Transfer Facility), (ii) extend the New Exchange Offer and
retain all Old Notes tendered prior to the expiration of the New Exchange Offer
or (iii) waive such unsatisfied conditions with respect to the New Exchange
Offer and accept all properly tendered Old Notes. If such waiver constitutes a
material change to the New Exchange Offer, the Company will promptly disclose
such waiver by means of a prospectus supplement that will be distributed to the
registered holder of Old Notes, and the Company will extend the New Exchange
Offer for a period of five to ten business days, depending upon the significance
of the waiver and the manner of disclosure to the registered holder of Old
Notes, if the New Exchange Offer would otherwise expire during such five-to-ten-
business-day period.
SUBSEQUENT EVENTS
On May 15, 1996, the Company commenced a solicitation of consents from the
holders of the Notes to amend the Indenture to modify certain covenants and
events of default thereunder as described in the excerpts from the Consent
Solicitation Statement therefor attached hereto as Exhibit A. No assurances can
be given that such amendment will be effected.
On April 16, 1996, the Company entered into an agreement and plan of merger
with Teletouch Communications, Inc. ("Teletouch"), a publicly traded paging
company, whereby the Company will acquire Teletouch for approximately $192
million (consisting of the issuance of approximately $80 million in common stock
of the Company, the assumption of approximately $95 million in indebtedness, net
of cash acquired, and the redemption of approximately $17 million in preferred
stock). On April 17, 1996, the Company entered into a definitive agreement to
purchase the nationwide, one-way paging license on the 931.9125 MHz frequency
covering the United States and Canada from Motorola, Inc., together with certain
related assets (including approximately 400 transmitters) for $43 million in
cash. Additionally, the Company has signed a letter of intent to acquire
Georgialina Communication Company and affiliates for $11.6 million, a definitive
agreement to acquire the Paging Divisions of Pac-West Telecomm, Inc. and
Subsidiary for $19.8 million and a letter of intent to acquire the assets of
Ventures In Paging L.C. for $6.1 million. No assurances can be given that any
such acquisitions will be completed.
In May 1996, the Company filed with the Securities and Exchange Commission
registration statements with respect to the public offering of 4,600,000 shares
of the Company's common stock and $100,000,000 aggregate principal amount of its
Senior Subordinated Notes due 2006. No assurances can be given that either such
financing will be completed.
3
<PAGE>
Exhibit A
COMPARISON OF EXISTING AND REVISED COVENANTS
COVENANTS
SET FORTH BELOW IS A DESCRIPTION OF THE REVISED COVENANTS AND EVENTS OF
DEFAULT WITH RESPECT TO THE NOTES WHICH HAVE BEEN MARKED AGAINST THE
DESCRIPTIONS THEREOF WHICH WERE CONTAINED IN THE ORIGINAL OFFERING MEMORANDUM
FOR THE NOTES (THE "OFFERING MEMORANDUM") TO REFLECT THE CHANGES PROPOSED TO BE
MADE BY THE AMENDMENTS. TEXT MARKED IN BOLD WOULD BE ADDED BY THE AMENDMENTS,
AND THE MARKED THROUGH TEXT WOULD BE DELETED.
LIMITATION ON CONSOLIDATED DEBT
The Company may not, and may not permit its Subsidiaries to, directly or
indirectly, create, incur, assume, become liable for or guarantee the payment of
(collectively, "incur") any Debt (including Acquired Debt), PROVIDED, HOWEVER,
that the Company may incur Debt (including Acquired Debt) and may permit a
Subsidiary to incur Acquired Debt if immediately thereafter the ratio of the
aggregate principal amount of Debt of the Company and its Subsidiaries
outstanding as of the most recent available quarterly or annual balance sheet to
THE PRODUCT OF FOUR TIMES Pro Forma Consolidated Cash Flow for the preceding
full fiscal QUARTER, determined on a pro forma basis as if any such Debt
had been incurred and the proceeds thereof had been applied at the beginning of
such fiscal QUARTER, would be less than 6.0 to 1.
Notwithstanding the foregoing, the Company may, and may permit its
Subsidiaries to, incur the following without regard to the foregoing limitation
and without duplication: (i) Debt of the Company under the Credit Facility in
an aggregate principal amount not to exceed $125 million at any one time
outstanding; (ii) Guarantees by Subsidiaries of Debt permitted by clause (i);
(iii) Debt of the Company evidenced by the Notes; (iv) Debt owed by the Company
to any wholly owned Subsidiary of the Company or owed by any wholly owned
Subsidiary of the Company to the Company or any other wholly owned Subsidiary of
the Company (but only so long as such Debt is held by the Company or such wholly
owned Subsidiary); (v) Debt outstanding on the date the Notes are originally
issued under the Indenture; (vi) Permitted Deferred Payments; (vii) Debt arising
from the honoring by a bank or other financial institution of a check, draft or
similar instrument drawn against insufficient funds in the ordinary course of
business, PROVIDED that such Debt is extinguished within two Business Days of
its occurrence; (viii) Refinancing Debt; and (ix) renewals of Guarantees
permitted by clause (ii) above. (Section 4.9)
For purposes of determining any particular amount of Debt under this
covenant, Guarantees of (or obligations with respect to letters of credit
supporting) Debt otherwise included in the determination of such amount shall
not also be included. For the purpose of determining compliance with this
covenant, (A) in the event that an item of Debt meets the criteria of more than
one of the types of Debt described in the above clauses, the Company, in its
sole discretion, shall classify such item of Debt and only be required to
include the amount and type of such Debt in one of such clauses; and (B) the
amount of Debt issued at a price which is less than the principal amount thereof
shall be equal to the amount of the liability in respect thereof determined in
accordance with generally accepted accounting principles. (Section 4.9)
LIMITATION ON RESTRICTED PAYMENTS
The Company may not, and may not permit any of its Subsidiaries to, (i)
directly or indirectly, declare or pay any dividend, or make any distribution,
in respect of its Capital Stock or to the holders thereof (including pursuant to
a merger or consolidation of the Company, but excluding any dividends or
distributions payable solely in shares of its Capital Stock (other than
Redeemable Stock) or in options, warrants or other rights to acquire its Capital
Stock (other than Redeemable Stock)), other than dividends or distributions
payable to the Company or any wholly owned Subsidiary of the Company, or by a
Subsidiary of the Company to a holder who is not the Company or a wholly owned
Subsidiary of the Company, provided that such dividend or distribution is paid
to all of the holders of the Capital Stock of the payor of such dividend, pro
rata in accordance with their respective interests, (ii) directly or indirectly,
purchase, redeem or otherwise acquire or retire for value (a) any Capital Stock
of the Company or any Related Person or (b) any options, warrants, or rights to
purchase or acquire shares of Capital Stock of the Company or any Related
Person, (iii) make any loan, advance, capital contribution to or investment in,
or payment on a Guarantee of any obligation of, any Affiliate or any Related
Person (other than the Company or a Subsidiary of the Company), inclusive of any
loan, advance, capital contribution to or investment in, or payment on a
Guarantee of any obligation of, any Affiliate or Related Person by the Company
pursuant to a transaction whereby any such Affiliate or Related Person becomes
an Affiliate or Related Person, but exclusive of any loan, advance, capital
contribution to or investment in, or payment on a Guarantee of any obligation
of, any Person by the Company or a Subsidiary of the Company pursuant to a
transaction whereby any such Person becomes a Subsidiary of the Company, in each
case unless otherwise prohibited by the terms of the Indenture, or (iv) redeem,
defease, repurchase, retire or otherwise acquire or retire for value prior to
any scheduled maturity, repayment or sinking fund payment (other than with the
proceeds of Refinancing Debt) Debt of the Company which is subordinate in right
of payment to the Notes (each of clauses (i) through (iv) being a "Restricted
Payment"), if at the time of such Restricted Payment, or after giving effect
thereto: (1) an Event of Default, or an event that with the lapse of time or the
giving of notice, or both, would constitute an Event of Default, shall have
occurred and be continuing, (2) the Company could not incur $1.00 of additional
Debt under the first paragraph of the "Limitation on Consolidated Debt" covenant
above, or (3) the aggregate of all Restricted Payments from the date of the
Indenture exceeds the sum of: (a) the remainder of (x) 100% of cumulative
CONSOLIDATED Cash Flow after June 30, 1996 through the last day of the last
full fiscal quarter immediately preceding such Restricted Payment for which
quarterly or annual financial statements of the Company are available minus (y)
the product of 2.0 times cumulative Consolidated Fixed Charges after June 30,
1996 through the last day of the last full fiscal quarter immediately preceding
such Restricted Payment for which quarterly or annual financial statements of
the Company are available; and (b) , 100% of the aggregate net proceeds from the
issuance, AFTER JUNE 30, 1996, of Capital Stock (other than Redeemable Stock) of
the Company and options,
4
<PAGE>
warrants or other rights on Capital Stock (other than Redeemable Stock) of the
Company and the principal amount of Debt of the Company that has been converted,
AFTER JUNE 30, 1996, into Capital Stock (other than Redeemable Stock) of the
Company.
The foregoing provision will not be violated by reason of (i) the payment
of any dividend within 60 days after declaration thereof if at the declaration
date such payment would have complied with the foregoing provision; (ii) the
purchase, redemption, acquisition or retirement of any shares of Capital Stock
of the Company in exchange for, or out of the net proceeds of the substantially
concurrent sale (other than to a Subsidiary of the Company) of, other shares of
Capital Stock (other than Redeemable Stock) of the Company; (iii) the purchase,
redemption, defeasance or other acquisition or retirement of Debt of the Company
which is subordinate in right of payment to the Notes, in exchange for, by
conversion into, or out of the net proceeds of, a substantially concurrent (a)
issue or sale (other than to a Subsidiary) of Capital Stock (other than
Redeemable Stock) of the Company, or (b) incurrence of Refinancing Debt with
respect to such subordinated Debt; or (iv) investments in telecommunications
businesses in an aggregate amount not exceeding $ 20.0 million; PROVIDED that no
Default or Event of Default shall have occurred and be continuing at the time,
or shall occur as a result, of any of the actions contemplated in clauses (ii)
and (iii) above. Any payment made pursuant to clauses (i) through (iii) (other
than subclause (iii)(b)) of this paragraph shall be a Restricted Payment for
purposes of calculating aggregate Restricted Payments under the preceding
paragraph. (Section 4.11).
EVENTS OF DEFAULT
The following are Events of Default with respect to the Notes: (a)
failure to pay any interest on any Note when due, continued for 30 days; (b)
failure to pay principal of (or premium, if any, on) any Note when due; (c)
default in the payment of principal and interest on Notes required to be
purchased pursuant to an Offer to Purchase as described under "Limitation on
Certain Asset Dispositions" and "Change of Control" in the Offering Memorandum
when due and payable; (d) failure to perform or comply with the provisions
described under "Limitation on Mergers, Consolidations and Certain Sales of
Assets" in the Offering Memorandum; (e) failure to perform or breach of any
other covenant or warranty of the Company in the Indenture, continued for 60
days after written notice from the Trustee or holders of at least 25% in
principal amount of the outstanding Notes as provided in the Indenture; (f) a
default shall have occurred under any bonds, debentures, notes or other
evidences of indebtedness of the Company or any Subsidiary of the Company or
under any mortgages, indentures or instruments under which there may be issued
or by which there may be secured or evidenced any indebtedness by the Company or
any Subsidiary of the Company, in any case with a principal amount of at least
$5 million outstanding, and such indebtedness already is due and payable in full
or such default has resulted in the acceleration of the maturity of such
indebtedness, in each case after a period of five days during which period such
default shall not have been cured or such acceleration shall not have been
rescinded; (g) the rendering of a final judgment or judgments (not subject to
appeal) against the Company or any of its Subsidiaries in an aggregate amount in
excess of $5 million which remain unstayed, in effect and unpaid for a period
of 60 consecutive days thereafter; and (h) certain events in bankruptcy,
insolvency or reorganization affecting the Company or any Subsidiary of the
Company. Subject to the provisions of the Indenture relating to the duties of
the Trustee in case an Event of Default shall occur and be continuing, the
Trustee will be under no obligation to exercise any of its rights or powers
under the Indenture at the request or direction of any of the holders, unless
such holders shall have offered to the Trustee reasonable indemnity. Subject to
such provisions for the indemnification of the Trustee, the holders of a
majority in aggregate principal amount of the outstanding Notes will have the
right to direct the time, method and place of conducting any proceeding for any
remedy available to the Trustee or exercising any trust or power conferred on
the Trustee. (Section 6.1)
If an Event of Default (other than Events of Default with respect to
certain events of bankruptcy, insolvency or reorganization affecting the Company
or any Subsidiary of the Company) shall occur and be continuing, either the
Trustee or the holders of at least 25% in aggregate principal amount of the
outstanding Notes may accelerate the maturity of all Notes; PROVIDED, HOWEVER,
that after such acceleration, but before a judgment or decree based on
acceleration, the holders of a majority in aggregate principal amount of
outstanding Notes may, under certain circumstances, rescind and annul such
acceleration if all Events of Default, other than the non-payment of accelerated
principal, have been cured or waived as provided in the Indenture. If a
specified Event of Default with respect to a certain event of bankruptcy,
insolvency or reorganization affecting the Company or any Subsidiary of the
Company occurs, the principal of the Notes then outstanding shall become
immediately due and payable without any declaration or other act on the part of
the Trustee or any holder of the Notes. (Section 6.2)
No holder of any Note will have any right to institute any proceeding with
respect to the Indenture or for any remedy thereunder, unless such holder shall
have previously given to the Trustee written notice of a continuing Event of
Default and unless also the holders of at least 25% in aggregate principal
amount of the outstanding Notes shall have made written request, and offered
reasonable indemnity, to the Trustee to institute such proceeding as trustee,
and the Trustee shall not have received from the holders of a majority in
aggregate principal amount of the outstanding Notes a direction inconsistent
with such request and shall have failed to institute such proceeding within 60
days. (Section 6.6) However, such limitations do not apply to a suit instituted
by a holder of a Note for enforcement of payment of the principal of (and
premium, if any) or interest on such Note on or after the respective due dates
expressed in such Note. (Section 6.7)
The Company will be required to furnish to the Trustee annually a statement
as to the performance by the Company of certain of its obligations under the
Indenture and as to any default in such performance. (Section 4.4)
