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FILED BY METROCALL, INC.
PURSUANT TO RULE 425 UNDER THE SECURITIES ACT OF 1933
SUBJECT COMPANY: METROCALL, INC.
COMMISSION FILE NO: 000-21924
FOR IMMEDIATE RELEASE:
Friday August 18, 2000
Metrocall Contact:
Vincent D. Kelly
Chief Financial Officer
(703) 660-6677 x6650
METROCALL SUPPLEMENTS ITS COMPETING PLAN MOTION AND
OBJECTS TO PAGENET'S BREAK-UP FEE/WINDOW-SHOP PROVISION
ALEXANDRIA, VA, August 18 -- Metrocall, Inc. (Nasdaq: MCLL)
announced today that it filed a supplement to its August 4th motion requesting
that the U.S. Bankruptcy Court for the District of Delaware terminate PageNet's
exclusivity period as to permit Metrocall to expeditiously submit a competing
plan of reorganization in the Chapter 11 cases of Paging Network, Inc. and its
operating subsidiaries and a limited objection to PageNet's July 25th motion for
approval by the Bankruptcy Court of a break-up fee and window-shop provisions in
connection with PageNet's merger agreement with Arch Communications. The filing
identifies improvements to Metrocall's proposal to the PageNet Board dated July
18, 2000 and is the result of discussions held on August 14, 2000 between
Metrocall, members of the Official Committee of Unsecured Creditors appointed in
PageNet's bankruptcy case and their respective professional advisors. These
improvements are as follows:
- In the event that Metrocall's proposal becomes the basis of a
plan of reorganization for PageNet that is both confirmed by
the Bankruptcy Court and consummated by the parties thereto,
Metrocall shall increase the cash component of its proposal by
$40 million to fund the break-up fee that would be payable to
Arch Communications under the pending merger agreement with
PageNet, provided that such break-up fee is approved by order
of the Bankruptcy Court.
- 10.0 million additional shares of new Metrocall common stock
shall be reallocated to holders of PageNet's senior
subordinated notes from the 13.0 million shares of new
Metrocall common stock proposed to be distributed to PageNet's
shareholders under Metrocall's July 18th proposal, providing
holders of PageNet's senior subordinated notes with a total
distribution of 96.8 million shares of new Metrocall common
stock.
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- Metrocall shall arrange for a credit facility to fund the
working capital needs of Vast on terms no less favorable than
those proposed by Arch under the pending merger agreement with
PageNet.
Metrocall's enhancement of its proposal is conditioned upon (a) an
agreement by the Committee to support, both in pleadings to be filed by the
Committee and during the hearing on August 21, 2000, at least that portion of
the relief requested in Metrocall's August 4th motion relating to (i)
Metrocall's conducting of expedited due diligence regarding the operating and
financial performance of PageNet and its U.S. operating subsidiaries, and (ii)
PageNet's full and prompt cooperation with Metrocall in connection with the
filing of documents necessary to obtain clearances and approvals from, among
others, the Federal Trade Commission, the Department of Justice, the Federal
Communications Commission, the Securities and Exchange Commission and Metrocall
shareholders, and (b) the entry by the Bankruptcy Court of an order providing
Metrocall with, at a minimum, the above described relief. Notwithstanding its
agreement with the Committee, Metrocall intends to seek to terminate PageNet's
exclusivity period so as to permit Metrocall to submit a competing plan of
reorganization pursuant to the timetable set forth in its motion.
Metrocall indicated that, in all other respects, the terms of its
proposal to the PageNet board remain the same, including the various conditions
to the proposed acquisition of PageNet that are described in Metrocall's July
19, 2000 press release.
As indicated in the Supplement, Metrocall also objects to PageNet's
motion for approval of a $40 million break-up fee and window-shop provisions
filed on July 25, 2000, provided that Metrocall will withdraw that portion of
its objection relating solely to PageNet's request for approval of the "break-up
fee" in the event that the Bankruptcy Court enters an order granting Metrocall
at least the relief supported by the Committee.
In addition to TD Securities (USA), Inc., which has been advising
Metrocall since May 1999, Metrocall has also recently retained DLJ Securities
Corp. as its financial advisor in connection with its proposed bid to acquire
PageNet.
Metrocall, Inc., headquartered in Alexandria, Virginia, is one of the
largest wireless data and messaging companies in the United States providing
both products and services to more than six million business and individual
subscribers. Metrocall was founded in 1965, became a publicly traded company in
1993 and currently employs approximately 3,800 professionals coast to coast. The
Company offers two-way interactive messaging, wireless e-mail and Internet
connectivity, cellular and digital PCS phones, as well as one-way messaging
services. Metrocall operates on many nationwide, regional and local networks,
including a new Two-Way Interactive Network (TWIN), and can supply a wide
variety of customizable Internet-based information content services. Also,
Metrocall offers totally integrated resource management systems and
communications solutions for business and campus environments. Metrocall's
wireless networks operate in the top 1,000 markets all across the nation and the
Company has offices and retail locations in more than forty states. Metrocall is
the largest equity-owner of Inciscent, an independent business-to-business
enterprise, that
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is a national full-service "wired-to-wireless" Application Service Provider
(ASP). For more information on Metrocall please visit our Web site and On-line
store at www.metrocall.com or AOL Keyword: Metrocall.
Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
The statements set forth above that are not historical facts, such as those
concerning Metrocall's proposal to acquire PageNet, are forward-looking
statements that are subject to risks and uncertainties. A number of risks and
uncertainties could cause actual results, events or developments to differ from
expectations. Among the factors that could cause actual results to differ are 1)
Metrocall's ability to obtain debt and equity financing for its proposal on
acceptable terms and conditions, as well as its ability to satisfy other
conditions to completing a transaction as previously disclosed; 2) changes in
trading prices of Metrocall securities; 3) changes in the terms of or other
factors relating to competing proposals for PageNet; 4) the response of the
PageNet Board and the PageNet creditors, and 5) actions of the bankruptcy court.
You should refer to our Annual Report on Form 10-K for a complete discussion of
factors that could cause Metrocall's actual results to differ materially from
those projected in forward-looking statements. The Company wishes to caution
readers not to place undue reliance on any such forward-looking statements,
which statements are made pursuant to the Private Securities Litigation Reform
Act of 1995 and, as such, speak only as of the date made.
ANY SECURITIES TO BE ISSUED PURSUANT TO THE METROCALL PROPOSAL WILL BE ISSUED
PURSUANT TO APPLICABLE PROVISIONS OF THE SECURITIES ACT OF 1933 OR AN EXEMPTION
THEREFROM. INVESTORS ARE URGED TO READ THE RELEVANT DOCUMENTS TO BE FILED WITH
THE SECURITIES & EXCHANGE COMMISSION AND/OR THE BANKRUPTCY COURT WHICH WILL
CONTAIN IMPORTANT INFORMATION ABOUT ANY TRANSACTION INVOLVING METROCALL.
INVESTORS CAN OBTAIN ANY DOCUMENT FILED WITH THE COMMISSION FOR FREE AT THE
COMMISSION'S WEB SITE, HTTP://www.SEC.GOV.
