*Pages 1--7 from Microsoft Word - 57757.doc* PUBLIC NOTICE FEDERAL COMMUNICATIONS COMMISSION 445 TWELFTH STREET, S. W. WASHINGTON, D. C. 20554 DA 06- 1254 News media information 202/ 418- 0500 Fax- On- Demand 202/ 418- 2830 Internet: http:// www. fcc. gov ftp. fcc. gov Released: June 16, 2006 APPLICATIONS FILED FOR CONSENT TO TRANSFER CONTROL OF MOBILE SATELLITE VENTURES SUBSIDIARY LLC FROM MOTIENT CORPORATION AND SUBSIDIARIES TO SKYTERRA COMMUNICATIONS, INC. WC Docket No. 06- 106 PLEADING CYCLE ESTABLISHED Petitions to Deny Due: July 17, 2006 Oppositions Due: July 27, 2006 Replies Due: August 1, 2006 INTRODUCTION SkyTerra Communications, Inc. (“ SkyTerra”) and Motient Corporation and subsidiaries (“ Motient”) (collectively, “the Applicants”) have filed a series of applications pursuant to sections 214 and 310( d) of the Communications Act of 1934, as amended. 1 The Applicants seek Commission approval of the transfer of control to SkyTerra of licenses and authorizations held by Mobile Satellite Ventures Subsidiary LLC (“ MSV Sub”), a direct wholly- owned subsidiary of Mobile Satellite Ventures LP (“ MSV LP”). 2 MSV LP and its general partner, Mobile Satellite Ventures GP Inc. (“ MSV GP”) are owned and controlled by five entities that are limited partners of MSV LP. 3 SkyTerra, a publicly- traded U. S. corporation holds an 18.2% indirect interest in MSV LP through its 80% owned subsidiary MSV Investors, LLC. The licenses and authorizations for which the Applicants seek consent to transfer control 1 47 U. S. C. §§ 214, 310( d). 2 MSV LP is the sole member of MSV Sub, and MSV GP is the general partner of MSV LP. Applicants are requesting that the Commission include authority for the transfer of control of (1) all authorizations issued to MSV Sub during the period between the filing of the application with the Commission and actual consummation of the proposed transaction; and (2) all applications (including applications for Special Temporary Authority), petitions, or other filings that are pending at the time of consummation of the proposed transfer of control. Applicants state that, following the closing of the proposed transaction, MSV Sub will supplement its pending applications as required under the Commission’s rules, 47 C. F. R. § 1.65, to reflect the new ownership structure. See application at pp. 5- 6. 3 The five entities are: Motient Corporation (45. 2% MSV GP and 45. 1% MSV LP); TMI Communications and Company, Limited Partnership (21.8% MSV GP and 21.8% MSV LP); MSV Investors, LLC (22.8% MSV GP and 22.8% MSV LP); funds affiliated with Columbia Capital (7.8% MSV GP and 7.8% MSV LP); and funds affiliated with Spectrum Equity (2.3% MSV GP and 2.3% MSV LP). 1 2 in this docketed proceeding consist of international and domestic section 214 authorizations, satellite space station licenses, satellite earth station licenses, and an experimental license, all held by MSV Sub. 4 MSV Sub is a Delaware limited- liability company with headquarters in Reston, Virginia. The Applicants state that MSV Sub offers a full range of maritime, land, and aeronautical satellite services, including voice and data, using both its own U. S.- licensed satellite and the Canadian- licensed L band satellite (MSAT- 1) licensed to Mobile Satellite Ventures (Canada) Inc. SkyTerra is a U. S. publicly traded company with indirect interests in MSV LP and TerreStar Networks, Inc. Motient, a publicly traded company, is a nationwide provider of wireless data solutions for Fortune 500 companies and the small to medium size business enterprise market. Pursuant to an Exchange Agreement (“ Agreement”) between SkyTerra and Motient, SkyTerra will obtain the vast majority of Motient’s interests in MSV LP and all of Motient’s interest in MSV GP. In exchange, Motient will receive non- voting common stock of SkyTerra which, in turn, will be converted to voting stock upon distribution by Motient to Motient’s common stockholders. Through similar and separate Exchange Agreements between SkyTerra and Columbia Capital, Spectrum Equity and MSV Investors, LLC (collectively with Motient, “the Initial Exchange”), SkyTerra will ultimately obtain 78.2% of the voting interest in MSV GP and 58.8% of the equity interest in MSV LP, resulting in a controlling interest and majority equity interest in the MSV Licensees. TMI Communications and Company, Limited Partnership (TMI) will retain its 21.8% equity interest in MSV LP and 21.8% voting interest in MSV GP. Following the transaction no single shareholder will have a 50% or greater equity or voting interest in SkyTerra. 5 Applicants state that the proposed transfer of control is in the public interest because it will provide for the development of an integrated satellite and terrestrial communications network that will provide ubiquitous, transparent, and seamless broadband service throughout North America to conventional handsets. Applicants are also requesting the Commission to approve the transaction without a declaratory ruling regarding the foreign ownership interest of MSV Sub attributable to TMI because, according to Applicants, TMI is not increasing the already approved 40% equity and/ or voting interest level set in a previous Commission Order and the foreign ownership of MSV Sub attributable to non- TMI interest holders will not exceed 25%. 6 4 On June 12, 2006, MSV International, LLC, a direct wholly- owned subsidiary of MSV LP, surrendered its satellite space station authorization to provide mobile service to South America, File No. SAT- LOA- 20030827- 00174 (See File No. SAT- T/ C- 20060517- 00063). As a result of the withdrawal, Applicants are no longer requesting that the space station authorization be transferred to SkyTerra. 5 SkyTerra is currently 60% owned and controlled, in the aggregate, by the Apollo Stockholders. The Apollo Stockholders are (1) Apollo Investment Fund IV, L. P.; (2) Apollo Overseas Partners IV, L. P.; (3) AP/ RM Acquisition, LLC; (4) AIF IV/ RRRR, LLC; and (5) ST/ RRRR, LLC. The individuals and/ or entities with a 10% or greater interest in SkyTerra are Apollo Investment Fund IV, L. P. (50%) and Harbinger Capital Partners Master Fund1, Ltd (13%). The Apollo Stockholders’ voting interests in SkyTerra are ultimately controlled by Mr. Leon Black through a series of intermediate subsidiaries and management arrangements. After consummation of the transaction, no individual or entity other than the Apollo Funds will hold a 10% or greater equity or voting interest in SkyTerra. The voting and equity interest of Apollo Funds will be reduced to a range between 16.6%- 25.8% because it is not know exactly how many shares of common stock the Apollo Funds will subscribe for in the Initial Exchange. 6 In a November 21, 2001 decision (“ 2001 Order”), the Commission approved of TMI’s indirect foreign ownership 2 3 SECTION 214 AUTHORIZATIONS The following applications for consent to the transfer of control of international Section 214 authorizations to SkyTerra have been assigned the file numbers listed below. A. International File No. Authorization Holder Authorization Number ITC- T/ C- 20060518- 00283 Mobile Satellite Ventures ITC- 214- 19950314- 00022 Subsidiary LLC ITC- 214- 19951215- 00023 B. Domestic Applicants filed an application for consent to transfer control of domestic section 214 authority to SkyTerra. Applicants assert that this transaction is entitled to presumptive streamlined treatment under section 63.02( b)( 2)( i) of the Commission's rules because: (1) Applicants and their affiliates combined will hold less than a 10% market share of the interstate, interexchange market; (2) Applicants and their affiliates will provide local exchange service, if at all, only in areas served by dominant local exchange carriers (none of which is a party to the proposed transaction); and (3) neither of the Applicants nor their affiliates is dominant with respect to any service. 7 In light of the multiple applications pending before the Commission in this transaction and the public interest review associated with them, however, we conclude that Applicants' domestic transfer of control application is not subject to streamlined treatment. SECTION 310( D) APPLICATIONS Part 25- Satellite Earth Station Authorization Applications The following applications for consent to the transfer of control of satellite earth stations authorizations to SkyTerra have been assigned the file numbers listed below. File No. Licensee Call Sign SES- T/ C- 20060517- 000828 Mobile Satellite Ventures E930124 Subsidiary LLC E940374 SES- T/ C- 20060517- 000829 E930367 E980179 E990133 of MSV Sub in excess of 25%. The 2001 Order permitted the MSV Licensee to be owned indirectly by TMI and/ or BCE Inc. and their Canadian shareholders in an amount up to and including equity and/ or voting interest of 40%. The 2001 Order also stated that further Commission approval would not be required unless foreign individuals or entities other than TMI were to acquire (individually and/ or in the aggregate) a greater than 25% indirect equity and/ or voting interest in MSV Sub. See Motient Services Inc., TMI Communications and Company LP, and Mobile Satellite Ventures LLC, Order and Authorization, File No. SAT- ASG- 20010302- 00017 et al. (DA 01- 2732); 16 FCC Rcd 20469 (Nov. 21, 2001). 7 47 C. F. R. § 63.02( b)( 2)( i). 3 4 Part 25- Satellite Space Station Authorization Applications The following applications for consent to the transfer of control of satellite space stations authorizations to SkyTerra have been assigned the file numbers listed below. File No. Licensee Call Sign SAT- T/ C- 20060517- 00062 Mobile Satellite Ventures AMSC- 1 Subsidiary LLC S2358 Part 5- Experimental Radio Service (other than broadcast) Authorization Applications The following application for consent to the transfer of control of experimental radio service (other than broadcast) authorization to SkyTerra has been assigned the file number listed below. File No. Licensee Call Sign 0020- EX- TC- 2006 Mobile Satellite Ventures WD2XNL Subsidiary LLC EX PARTE STATUS OF THIS PROCEEDING Pursuant to section 1.1200( a) of the Commission’s rules, 8 the Commission may adopt modified or more stringent ex parte procedures in particular proceedings if the public interest so requires. We announce that this proceeding will be governed by permit- but- disclose ex parte procedures that are applicable to non- restricted proceedings under section 1.1206 of the Commission’s rules. 9 We direct parties making oral ex parte presentations to the Commission’s statement re-emphasizing the public’s responsibility in permit- but- disclose proceedings and are reminded that memoranda summarizing the presentation must contain the presentation’s substance and not merely list the subjects discussed. 10 More than a one- or two- sentence description of the views and arguments presented is generally required. 11 Other rules pertaining to oral and written presentations are set forth in section 1.1206( b) as well. 12 We urge parties to use the Electronic Comment Filing System (“ ECFS”) to file ex parte submissions. 13 8 47 C. F. R. § 1.1200( a). 9 Id. § 1.1206. 10 See Commission Emphasizes the Public’s Responsibilities in Permit- But- Disclose Proceedings, Public Notice, 15 FCC Rcd 19945 (2000). 11 See 47 C. F. R. § 1.1206( b) (2). 12 Id. § 1.1206( b). 13 See discussion infra Part VI. 4 6 the building. Commercial overnight mail (other than U. S. Postal Service Express Mail and Priority Mail) must be sent to 9300 East Hampton Drive, Capitol Heights, MD 20743. U. S. Postal Service first- class, Express, and Priority mail should be addressed to 445 12th Street, S. W., Washington, D. C. 20554. One copy of each pleading must be delivered electronically, by e- mail or facsimile, or if delivered as paper copy, by hand or messenger delivery, by commercial overnight courier, or by first- class or overnight U. S. Postal Service mail (according to the procedures set forth above for paper filings), to the Commission's duplicating contractor, Best Copy and Printing, Inc., at fcc@ bcpiweb. com or (202) 488- 5563 (facsimile). Additionally, filers may deliver courtesy copies by email or facsimile to the following Commission staff: (1) Jodi Cooper, Policy Division, International Bureau, at jodi. cooper@ fcc. gov or (202) 418- 2824 (facsimile); (2) JoAnn Lucanik, Satellite Division, International Bureau, at joann. lucanik@ fcc. gov or (202) 418- 0748 (facsimile); (3) Jeanette Spriggs, Satellite Division, International Bureau, at jeanette. spriggs@ fcc. gov or (202) 418- 0748 (facsimile); (4) Adam Kirschenbaum, Competition Policy Division, Wireline Competition Bureau, at adam. kirschenbaum@ fcc. gov or (202) 418- 1413 (facsimile); (5) Nancy Hey, Office of Engineering and Technology, at nancy. hey@ fcc. gov or 202.418.2432; and (6) Jim Bird, Office of General Counsel, at jim. bird@ fcc. gov or (202) 418- 1234 (facsimile). Copies of the Applications and any subsequently- filed documents in this matter may be obtained from Best Copy and Printing, Inc., in person at 445 12th Street, S. W., Room CY- B402, Washington, D. C. 20554, via telephone at (202) 488- 5300, via facsimile at (202) 488- 5563, or via e- mail at fcc@ bcpiweb. com. The Applications and any associated documents are also available for public inspection and copying during normal reference room hours at the following Commission office: FCC Reference Information Center, 445 12th Street, S. W., Room CY- A257, Washington, D. C. 20554. The Applications also are available electronically through the Commission’s ECFS, which may be accessed on the Commission’s Internet website at http:// www. fcc. gov. People with Disabilities: To request this Public Notice in accessible formats (computer diskette, large print, audio recording, and Braille) send an email to fcc504@ fcc. gov or call the Consumer & Governmental Affairs Bureau at 202- 418- 0530 (voice), 202- 418- 0432 (tty). For further information, contact Jodi Cooper, Policy Division, International Bureau, at 202- 418- 2064. 6 7 -FCC- 7