<PAGE> 1
FILED BY METROCALL, INC.
PURSUANT TO RULE 425 UNDER THE SECURITIES ACT OF 1933
SUBJECT COMPANY: METROCALL, INC.
COMMISSION FILE NO: 000-21924
This Rule 425 filing contains written correspondence related to the
previously-announced acquisition proposal submitted by Metrocall, Inc. to
Paging Network, Inc.
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.
<PAGE> 2
METROCALL, INC.
6677 RICHMOND HIGHWAY
ALEXANDRIA, VIRGINIA 22306
(703) 660-9343
July 25, 2000
Paging Network, Inc.
14911 Quorum Drive
Dallas, Texas 75240
Attention: John P. Frazee, Jr.
Chairman of the Board
Re: Acquisition Proposal of Metrocall
Dear Jack:
I was disappointed to read the press release that was issued by
Paging Network, Inc. ("PageNet") during the afternoon of July 24th and to later
receive your letter rejecting the Metrocall Proposal set forth in my letter to
the PageNet Board of Directors dated July 18, 2000. Your letter states PageNet's
conclusion that the Metrocall Proposal does not fit the definition of a
"Superior Proposal" within the meaning of Section 6.2 of the Agreement and Plan
of Merger dated November 7, 1999, as amended, between PageNet and Arch
Communications Group, Inc. ("Arch"). Metrocall does not understand how it is
possible for PageNet to have reached this conclusion on the basis of a fair
minded and disinterested analysis of the value offered to all constituencies of
PageNet under the Metrocall Proposal.
Given the language of the press release and your letter, it
appears that the Board of Directors of PageNet has shut the door on further
discussions with Metrocall and has made a determination not to pursue
Metrocall's "Superior Proposal". As we interpret PageNet's present position, it
appears that PageNet is prepared to proceed with the Arch transaction while
disregarding the potential benefits to be realized through an open bankruptcy
auction process that
<PAGE> 3
John P. Frazee, Jr.
July 25, 2000
Page 2
could result in significantly greater returns to PageNet's creditors and
equityholders without any material delay.
Notwithstanding Metrocall's concern that making any further
requests for the delivery of due diligence materials will be in vain, Metrocall
hereby requests reconsideration of your outright refusal to continue a dialogue
with Metrocall and that you provide us, no later than July 28, 2000 at 12:00
p.m., prevailing Eastern Time, with access to the information requested by
Metrocall in its July 18th letter. Metrocall is prepared to act promptly to
complete due diligence and stands ready to work diligently toward the conclusion
of the acquisition outlined in the Metrocall Proposal.
PageNet's rejection of the Metrocall Proposal without providing
any reasons for doing so appears not to be based upon a balanced evaluation of
that proposal and disregards certain obvious benefits. In addition to the
advantages described in Metrocall's letter of July 18th (greater total
consideration to creditors and shareholders; greater consideration to
bondholders; improved treatment to PageNet's lenders; and a greater opportunity
for shareholders to maximize value with the strongest partner in the paging
industry), there are a number of other factors, both tangible and intangible,
that demonstrate that the Metrocall Proposal should be deemed a "Superior
Proposal". These include, among others:
- Metrocall's valuable 42% interest in Inciscent;
- Metrocall's prominent equity sponsors including Aether Systems,
PSI Net and Hicks, Muse, Tate & Furst;
- Metrocall's largest shareholder is AT&T Wireless as a result of
its recent decision to convert $105 million of preferred stock
into 13,250,000 shares of Metrocall common stock;
- Metrocall's better customer base that includes a greater
percentage of profitable business users;
- Metrocall's capacity to utilize different types of devices and
technologies to deliver services to customers; and
- Metrocall's demonstrated success in industry consolidation.
As a result of PageNet's consent on July 24, 2000 to the
involuntary petition filed on July 14, 2000, PageNet has an unquestioned
fiduciary duty to maximize value to all of its creditors and shareholders.
Serious questions exist as to whether PageNet's Board of Directors is carrying
out these fiduciary duties in light of the content and tone of both PageNet's
press release
<PAGE> 4
John P. Frazee, Jr.
July 25, 2000
Page 3
and its letter of July 24th declaring an unwillingness to further discuss the
Metrocall Proposal. While the subject is delicate, questions also exist as to
whether those who made the decision to foreclose a better offer are unable to
see the Metrocall Proposal clearly because of their own economic self interest
in the Arch transaction.
Metrocall is a serious and credible strategic acquiror of
PageNet. PageNet should be embracing and not rebuffing such a suitor under
current circumstances. Metrocall remains interested in pursuing the Metrocall
Proposal in its present form or as it may be amended and reserves its rights to
pursue this transaction within the context of PageNet's bankruptcy process.
Very truly yours,
METROCALL, INC.
By: /s/ WILLIAM L. COLLINS, III
---------------------------------
Name: William L. Collins, III
Title: Chairman of the Board &
Chief Executive Officer
