OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING COMMON SHARES
OF
AMERICAN PAGING, INC.
AT
$2.50 NET PER COMMON SHARE
BY
API MERGER CORP.
A DIRECT WHOLLY OWNED SUBSIDIARY OF
TELEPHONE AND DATA SYSTEMS, INC.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON TUESDAY, MARCH 17, 1998, UNLESS THE OFFER IS EXTENDED.
February 18, 1998
To Our Clients:
Enclosed for your consideration are an Offer to Purchase, dated February 18,
1998 (the "Offer to Purchase"), and a related Letter of Transmittal in
connection with the offer by API Merger Corp., a Delaware corporation
("Purchaser") and a direct wholly owned subsidiary of Telephone and Data
Systems, Inc., an Iowa corporation ("TDS"), to purchase all outstanding Common
Shares, par value $1.00 per share (the "Common Shares"), of American Paging,
Inc., a Delaware corporation (the "Company"), at a price of $2.50 per Common
Share, net to the seller in cash, without interest thereon, upon the terms and
subject to the conditions set forth in the Offer to Purchase and in the related
Letter of Transmittal (which, together with any amendments or supplements
thereto, constitute the "Offer").
We are (or our nominee is) the holder of record of Common Shares held by us
for your account. A TENDER OF SUCH COMMON SHARES CAN BE MADE ONLY BY US OR OUR
NOMINEE AS THE HOLDER OF RECORD AND PURSUANT TO YOUR INSTRUCTIONS. THE LETTER OF
TRANSMITTAL IS FURNISHED TO YOU FOR YOUR INFORMATION ONLY AND CANNOT BE USED BY
YOU TO TENDER COMMON SHARES HELD BY US FOR YOUR ACCOUNT.
We request instruction as to whether you wish to have us tender on your
behalf any or all of the Common Shares held by us for your account, upon the
terms and subject to the conditions set forth in the Offer.
Your attention is invited to the following:
1. The tender price is $2.50 per Common Share, net to the seller in cash,
without interest thereon, upon the terms and subject to the conditions set forth
in the Offer.
2. The Offer is being made for all outstanding Common Shares.
3. The Board of Directors of the Company has unanimously determined that
each of the Offer and the Merger (as defined in the Offer to Purchase) is fair
to the shareholders of the Company, and recommends that shareholders accept the
Offer and tender their Common Shares pursuant to the Offer. The unanimous vote
of the Board of Directors of the Company is based upon, among other things, the
unanimous recommendation of the Offer by a Special Committee of the Board of
Directors of the Company consisting of the independent directors of the Company
who are not directors, officers or employees of TDS or Purchaser or otherwise
affiliated with TDS or Purchaser nor officers or employees of the Company.
4. The Offer and withdrawal rights will expire at 12:00 Midnight, New York
City time, on Tuesday, March 17, 1998, unless the Offer is extended.
5. The Offer is conditioned upon, among other things, (i) there being
validly tendered and not withdrawn prior to the expiration of the Offer at least
the number of Common Shares that when added to the Common Shares owned by TDS
and Purchaser shall constitute 90% of the Common Shares then outstanding (the
"Minimum Condition") and (ii) that the Asset Contribution Agreement, dated as of
December 22, 1998, among TDS, TSR Paging, Inc., a Delaware corporation, and TSR
Wireless, LLC, a Delaware limited liability company, be in full force and effect
and not terminated in accordance with the terms thereof and all of the
conditions set forth in Articles XI and XII thereof shall have been satisfied or
waived (the "Asset Contribution Agreement Condition"). Purchaser has agreed to
waive the Minimum Condition under certain circumstances described in the Offer
to Purchase.
6. Except as otherwise provided in Instruction 6 of the Letter of
Transmittal, tendering shareholders will not be obligated to pay brokerage fees,
commissions or stock transfer taxes with respect to the purchase of Common
Shares by Purchaser pursuant to the Offer. However, federal income tax backup
withholding at a rate of 31% may be required, unless an exemption is provided or
unless the required taxpayer identification information is provided (see
Instruction 9 to the Letter of Transmittal).
7. In all cases, payment for Common Shares purchased pursuant to the Offer
will be made only after timely receipt by the Depositary of certificates for, or
a Book-Entry Confirmation (as defined in the Offer to Purchase) with respect to,
such Common Shares and a Letter of Transmittal (or a manually signed facsimile
thereof), properly completed and duly executed, with all required signature
guarantees, or, in the case of a book-entry transfer, an Agent's Message, and
all other documents required by the Letter of Transmittal. See "THE TENDER
OFFER--Procedures for Accepting the Offer and Tendering Common Shares" of the
Offer to Purchase.
If you wish to have us tender any or all of your Common Shares, please so
instruct us by completing, executing and returning to us the instruction form
contained in this letter. An envelope in which to return your instructions to us
is enclosed. If you authorize the tender of your Common Shares, all such Common
Shares will be tendered unless otherwise specified in your instructions. YOUR
INSTRUCTIONS SHOULD BE FORWARDED TO US IN AMPLE TIME TO PERMIT US TO SUBMIT A
TENDER ON YOUR BEHALF PRIOR TO THE EXPIRATION OF THE OFFER.
The Offer is made solely by the Offer to Purchase and the related Letter of
Transmittal and is being made to all holders of Common Shares and is not being
made to, nor will tenders be accepted from or on behalf of, shareholders in any
jurisdiction where the making of the Offer or acceptance thereof is not in
compliance with the laws of such jurisdiction. In those jurisdictions where
securities, blue sky or other laws require the Offer to be made by a licensed
broker or dealer, the Offer shall be deemed to be made on behalf of Purchaser by
Credit Suisse First Boston Corporation or one or more registered brokers or
dealers licensed under the laws of such jurisdiction.
2
INSTRUCTIONS WITH RESPECT TO THE
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING COMMON SHARES OF
AMERICAN PAGING, INC.
The undersigned acknowledge(s) receipt of your letter and the enclosed Offer
to Purchase, dated February 18, 1998, and the related Letter of Transmittal
(which, together with any amendments or supplements thereto, constitute the
"Offer") in connection with the Offer by API Merger Corp., a Delaware
corporation and a direct wholly owned subsidiary of Telephone and Data Systems,
Inc., an Iowa corporation, to purchase all outstanding Common Shares, par value
$1.00 per share (the "Common Shares"), of American Paging, Inc., a Delaware
corporation, at a price of $2.50 per Common Share, net to the seller in cash,
without interest thereon, upon the terms and subject to the conditions set forth
in the Offer to Purchase.
This will instruct you to tender the number of Common Shares indicated below
(or, if no number is indicated below, all Common Shares) that are held by you
for the account of the undersigned, upon the terms and subject to the conditions
set forth in the Offer to Purchase.
SIGN HERE
Number of Common Shares ----------------------------------------
To be Tendered: ----------------------------------------
------------* (SIGNATURE(S))
Please type or print name:
----------------------------------------
Dated: , 1998 ----------------------------------------
Please type or print address:
----------------------------------------
----------------------------------------
Area Code and Telephone no:
----------------------------------------
Taxpayer identification or social
security no.:
----------------------------------------
- ------------------------
*Unless otherwise indicated, it will be assumed that all Common Shares held by
us for your account are to be tendered.
3