*Pages 1--5 from Microsoft Word - 55324.doc* PUBLIC NOTICE Federal Communications Commission 445 12 th Street, S. W. Washington, D. C. 20554 News Media Information 202 / 418- 0500 Fax- On- Demand 202 / 418- 2830 TTY 202 / 418- 2555 Internet: http:// www. fcc. gov ftp. fcc. gov DA 06- 482 Released: February 27, 2006 DOMESTIC SECTION 214 APPLICATION FILED FOR THE TRANSFER OF CONTROL OF BIRCH TELECOM, INC., DEBTOR- IN- POSSESSION, TO THE SHAREHOLDERS OF THE NEWLY REORGANIZED BIRCH TELECOM STREAMLINED PLEADING CYCLE ESTABLISHED WC Docket No. 06- 45 Comments Due: March 13, 2006 Reply Comments Due: March 20, 2006 On February 17, 2006, Birch Telecom, Inc., Debtor- in- Possession (“ Birch DIP”) and the shareholders of the newly reorganized Birch Telecom (together “Applicants”), pursuant to sections 63.03 and 63.04 of the Commission’s rules, 1 requested authority to transfer control of the domestic section 214 authorizations held by certain subsidiaries of Birch DIP from Birch DIP to the shareholders (“ New Birch Shareholders”) of the newly reorganized Birch Telecom (“ New Birch”) pursuant to a Third Amended Joint Reorganization Plan (the “Reorganization Plan”) proposed by Birch DIP. 2 Subject to bankruptcy court approval, the Reorganization Plan authorizes Birch DIP to emerge from bankruptcy court protection with a new capital structure as New Birch. Applicants assert that this transaction is entitled to presumptive streamlined treatment under section 63.03( b)( 2)( i) of the Commission’s rules. Immediately following the transaction: (1) New Birch will have a market share in the interstate, interexchange market of less than 10%; and (2) New Birch and its affiliates will provide competitive telephone exchange services exclusively in geographic areas served by dominant local exchange carriers. With respect to section 63.03( b)( 2)( i), the Applicants and their affiliates are not dominant with respect to any service. 3 1 See 47 C. F. R. §§ 63.03, 63.04. 2 Applicants are also filing applications for transfer of control associated with authorization for international services. Any action on this domestic 214 application is without prejudice to Commission action on other related, pending applications. 3 See 47 C. F. R. § 63.03( b)( 2)( i). 1 2 Birch DIP, a Delaware corporation, is a holding company and, through its twenty- eight direct and indirect subsidiaries, provides small and medium- sized businesses with voice and data services, including local dial tone, long distance, “911” services, call waiting, high- speed Internet access, web hosting, and other services such as virtual networking. 4 Birch DIP currently serves customers in twenty- five states. 5 New Birch, a Delaware corporation, and its subsidiaries will provide the same telecommunications services that Birch DIP and its subsidiaries currently provide. Each of the New Birch subsidiaries possessing a section 214 authorization will be either directly or indirectly owned and controlled by New Birch. The following entities will hold a 10% or greater interest in New Birch: UBS Willow Fund LLC, a domestic company (29.4%); Strategic Value Master Fund Ltd. c/ o State Street Cayman Trust Co., a Cayman Islands limited company (26.2%); and Banc of America Strategic Solutions, Inc., a domestic corporation (10.3%). Once the Reorganization Plan has been approved by the bankruptcy court and the conditions under the Reorganization Plan have been satisfied, Birch DIP will emerge from bankruptcy with a new capital structure as New Birch. Pursuant to the Reorganization Plan, all of Birch DIP’s outstanding indebtedness will be extinguished and certain of Birch DIP’s creditors will receive equity in New Birch. Following the reorganization of Birch DIP, no single shareholder will control New Birch. Moreover, all of the New Shareholders were also shareholders of Birch DIP. Applicants state that the proposed transaction serves the public interest because: (1) Birch DIP’s emergence from bankruptcy court protection will not adversely affect competition in any of the markets in which Birch currently provides service; (2) New Birch will continue to provide service to all of the customers of Birch DIP without interruption; (3) New Birch will continue to hold authority to operate and expects to retain all customer contracts currently held by Birch DIP; and (4) there will be no change in the terms, conditions, or price of service, and no detrimental change in customer service. 4 The following are the Birch DIP subsidiaries that provide telecommunications services under blanket domestic section 214 authority: American Local Telecommunications, L. L. C., a Texas company; Birch Telecom of Kansas, Inc., a Kansas corporation; Birch Telecom of Missouri, Inc., a Delaware corporation; Birch Telecom of Oklahoma, Inc., a Delaware corporation; Birch Telecom of the South, Inc., a Delaware corporation; Birch Telecom of Texas Ltd., L. L. P., a Texas company; Birch Telecom of the Great Lakes, Inc., a Delaware corporation; Birch Telecom 1996, Inc., a Delaware corporation; Ionex Communications, Inc., a Kansas corporation; Ionex Communications North, Inc., a South Dakota corporation; Ionex Communications South, Inc., a Texas corporation; and Telecom Resources, Inc., a Texas corporation. 5 Through various subsidiaries, Birch DIP is certificated to offer telecommunications services in all fifty states and provides facilities- based and resold telecommunications services in twenty- five states, including Alabama, Colorado, Florida, Georgia, Idaho, Iowa, Kansas, Kentucky, Louisiana, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Mexico, North Carolina, North Dakota, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Washington, and Wyoming. 2 5 Filings and comments are also available for public inspection and copying during regular business hours at the FCC Reference Information Center, Portals II, 445 12th Street, S. W., Room CY- A257, Washington, D. C. 20554. They may also be purchased from the Commission’s duplicating contractor, Best Copy and Printing, Inc., Portals II, 445 12th Street, S. W., Room CYB402, Washington, D. C. 20554, telephone: (202) 488- 5300, fax: (202) 488- 5563, or via e-mail www. bcpiweb. com. For further information, please contact Tracey Wilson- Parker at (202) 418- 1394, or Adam Kirschenbaum at (202) 418- 7280. - FCC - 5