CellNet Data Systems Signs Asset Purchase Agreement and Outlines Bidding Procedures.

Business Editors

SAN CARLOS, Calif.--(BUSINESS WIRE)--March 15, 2000

CellNet Data Systems, Inc. (NASDAQ: CNDS) announced today that it has signed an Asset Purchase Agreement for the sale of substantially all of its assets and business operations. A copy of the agreement has been filed under a Report on Form 8-K dated March 10, 2000 with the Securities and Exchange Commission (the "SEC") and with the U.S. Bankruptcy Court in Delaware.

As previously reported, on February 4, 2000, CellNet Data Systems, Inc. ("CellNet"), together with its subsidiaries (collectively, the "Debtors"), filed voluntary petitions for relief under Chapter 11 of Title 11 of the United States Code, 11 U.S.C. Sections 101 et seq. (the "Bankruptcy Code") in the United States Bankruptcy Court for the District of Delaware -- IN RE CELLNET DATA SYSTEMS, INC., ET AL., DEBTORS, Chapter 11, Case No. 00-00844 (PJW).

Debtors filed their petitions pursuant to a Proposal Letter and a Summary of Terms of an agreement with Schlumberger Limited pursuant to which Schlumberger, or an entity designated by it, would acquire all or substantially all of the assets and business operations of the Debtors and certain specified liabilities related thereto. On March 3, 2000, Schlumberger Resource Management Services, Inc. (as "Purchaser") and Schlumberger Technology Corporation (its parent company), each affiliates of Schlumberger, entered into an Asset Purchase Agreement dated as of March 1, 2000 with certain of the Debtors including CellNet (as "Sellers"). The Asset Purchase Agreement contains the definitive terms under which the Purchaser would acquire from the Sellers all or substantially all of the assets and business operations of the Debtors and certain specified liabilities related thereto. The Asset Purchase Agreement is intended to carry out the provisions contained in the Proposal Letter and Summary of Terms, copies of which have been previously filed with the SEC in CellNet's Report on Form 8-K dated February 7, 2000 under Item 7 (c).

On March 9, 2000, the parties to the Asset Purchase Agreement entered into a First Amendment to Asset Purchase Agreement (the "First Amendment") to effect certain minor changes therein. A copy of the First Amendment has also been filed with the SEC as an exhibit to the Report on Form 8-K dated March 10, 2000 under Item 7 (c) and with the U.S. Bankruptcy Court in Delaware.

The approval of the Asset Purchase Agreement is subject to the receipt of higher and better offers. Parties wishing to submit higher and better offers must do so not later than 2:00 p.m. EDT April 12, 2000. If the Debtors receive a qualified bid, an auction will be conducted at 10:00 a.m. EDT April 14, 2000.

The final hearing and Court approval of the Asset Purchase agreement is scheduled for April 19, 2000. Subject to any higher and better offers and final approval by the Bankruptcy Court, CellNet anticipates completing the process by the first week of May 2000.

As previously reported, if the Court approves the proposed transaction in its present form, the CellNet 14% Senior Discount Notes and those liabilities not assumed by Schlumberger RMS will share in $55 million in cash less certain administrative expenses. Furthermore, there will be no value allocated to the current equity of the CellNet common stock (NASDAQ: CNDSQ) and the 7% Exchangeable Preferred Securities of CellNet Funding, LLC (NASDAQ: CNDPQ). The allocation of the distributions (dividends) held in escrow for CellNet Funding, LLC (NASDAQ: CNDPQ) will be subject to future view by the Court.

For more Company information visit http://www.cellnet.com.

Certain statements contained in this News Release are forward-looking statements, including, without limitation, statements relating to: expectations with respect to the acquisition of CellNet by Schlumberger; the approval by the Court of CellNet's bankruptcy filing and the effect of a Chapter 11 Reorganization on the value of any common stock of CellNet and/or 7% Exchangeable Preferred Securities of CellNet Funding, L.L.C. These statements therefore are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Actual results may differ from these statements and such differences may be material. Investors are encouraged to review CellNet's most recent Form 10-K and Form 10-Q filed with the Securities and Exchange Commission for a discussion of these and additional factors that could affect CellNet's future performance.