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EXHIBIT 99.6
Investor contact: Kirk Brewer
972.801.8012
Media contact: Scott Baradell
972.801.8180
PAGENET INITIATES VOLUNTARY REORGANIZATION
UNDER CHAPTER 11 IN EFFORT TO EXPEDITE ARCH MERGER
Company will continue all services and normal operations
DALLAS, July 24 -- Paging Network, Inc. (NASDAQ: PAGE) today announced
it has filed a voluntary reorganization under Chapter 11 in the U.S. Bankruptcy
Court for the District of Delaware to help expedite its proposed merger with
Arch Communications Group, Inc. In doing so, PageNet has voluntarily consented
to the involuntary petition filed July 14 by three affiliated noteholders and
has asked the court to set an early date to consider PageNet's plan of
reorganization. PageNet believes it can expedite the process through an
immediate Chapter 11 filing with the goal of emerging as quickly as possible
with the approvals required to confirm the plan and close its merger
transaction.
PageNet said it has filed its plan of reorganization with the court and
that it is consistent with its previously announced merger agreement with Arch
Communications Group, Inc., with minor modifications to facilitate the PageNet
restructuring. PageNet has received indications of support for the plan and this
course of action from the substantial majority of its bondholders. PageNet also
has the support of the required majority of its banks in initiating the Chapter
11 filing.
PageNet also said its Board of Directors has concluded that the
proposal received from Metrocall, Inc. last week was not a "superior proposal"
to the Arch merger under the terms of the merger agreement, and the Board will
not discuss the proposal further with Metrocall.
The Chapter 11 filing will permit PageNet to complete its
reorganization in an orderly process under court supervision. Confirmation of
the plan will permit PageNet and Arch to consummate their merger, and permit the
combined company to emerge with a substantially enhanced balance sheet
reflecting the conversion of approximately $1.5
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PageNet Initiates Voluntary Reorganization Under Chapter 11
in Effort to Expedite Arch Merger
Add One
billion in debt and accrued interest into common stock of the combined company.
The company stressed that all services provided to PageNet's customers will not
be interrupted by this action.
PageNet announced it has received a commitment from its bank group to
provide debtor-in-possession (DIP) financing totaling $50 million, which is
expected to be sufficient to enable PageNet to operate its business without
interruption pending confirmation of the plan of reorganization. The company
said it has requested that the Court allow PageNet to continue all employee
compensation and benefits plans; customer sales, support and service activities;
and payment of funds due to suppliers.
"This Chapter 11 filing has been made in order to expedite the
completion of our merger with Arch. We believe the plan we have filed has the
support of our lenders and our bondholders, and this represents one of the most
significant steps toward completing this transaction, " said John P. Frazee,
Jr., PageNet chairman and chief executive officer. "We intend to do everything
we can to expedite this process with the goal of closing our merger with Arch as
soon as possible."
C. Edward Baker, Jr., Arch's chairman and chief executive officer,
said, "We are eager to see PageNet complete the plan confirmation process so
that we can finalize the merger of our two companies."
Under the proposed plan of reorganization and merger as revised in
connection with the filing, owners of PageNet's senior subordinated notes will
receive 46.6 percent of the combined company's common stock, and owners of
PageNet's common stock will own 5.0 percent of the combined company's common
stock. Owners of PageNet's senior subordinated notes will also receive 60.5
percent of PageNet's interest in Vast Solutions, which will be spun-off as part
of the merger. Owners of PageNet's common stock will receive 20.0 percent of
PageNet's interest in Vast. The combined company also will retain an interest of
up to 19.5 percent in Vast. Under the merger agreement prior to its revision,
PageNet common stockholders would have received 7.5 percent of the combined
company's common stock and 11.7 percent of Vast.
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PageNet Initiates Voluntary Reorganization Under Chapter 11
in Effort to Expedite Arch Merger
Add One
Vast and PageNet's Canadian subsidiary have not filed Chapter 11
petitions and are not debtors under Paging Network, Inc.'s bankruptcy case.
The merger agreement calls for owners of Arch common stock to own 31.4
percent of the combined company's common stock, and owners of Arch Senior
Discount Notes will own approximately 17.0 percent of the combined company's
common stock.
PageNet is a leading provider of wireless messaging with subscribers in
all 50 states, the District of Columbia, the U.S. Virgin Islands, Puerto Rico
and Canada. The company offers a full range of paging and advanced messaging
services, including guaranteed-delivery messaging and two-way wireless e-mail.
Arch Communications Group, Inc., Westborough, MA, is a leading U.S. wireless
messaging company. It provides local, regional and nationwide wireless
communications services to customers in all 50 states, the District of Columbia
and in the Caribbean. Arch operates approximately 300 offices and company-owned
stores across the country. Arch's pending merger with Paging Network, Inc. will
create one of the leading wireless messaging companies in North America.
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
Statements contained in, or made in conjunction with, this release which are not
historical fact, such as forward-looking statements concerning future financial
performance and growth of the business of PageNet, Arch and the future combined
company, involve risks and uncertainties, including those described in Arch's
and PageNet's most recent Annual Reports on Form 10-K and other filings with the
Securities and Exchange Commission. Although Arch and PageNet believe the
expectations reflected in any forward-looking statements are based on reasonable
assumptions, they can give no assurance that their expectations will be
attained. Factors that could cause actual results to differ materially from
their expectations include the recapitalization of the combined companies,
challenges of integrating the businesses of Arch and PageNet, competitive
pricing pressures, the introduction of products and services by competitors, the
performance of vendors and independent contractors, costs and timing associated
with post-merger synergies and cost reductions, the timing, performance and
market acceptance of new products and services, including the construction,
testing and placement into operation of the Company's advanced messaging
network, future capital needs following the merger, the financial condition of
the Company and the uncertainty of additional funding, and other risks. Any
forward-looking statements represent the best judgment of both Arch and PageNet
as of the date of this release. The companies disclaim any intent or obligation
to update any forward-looking statements.
