**DA 04-3667**

**Released: November 19, 2004**

**DOMESTIC SECTION 214 APPLICATION FILED FOR TRANSFER OF CONTROL OF
CYPRESS COMMUNICATIONS OPERATING COMPANY, INC.**

**STREAMLINED Pleading Cycle Established**

**WC Docket No. 04-417**

**Comments Due: December 3, 2004**

**Reply Comments Due: December 10, 2004**

On November 12, 2004, Cypress Communications Holding Co., Inc. ("Cypress
Holding") and TechInvest Holding Company, Inc. ("THC") (together, the
"Applicants"), filed an application pursuant to sections 63.03 and 63.04
of the Commission's rules[^1] requesting approval to transfer of control
of Cypress Communications Operating Company, Inc. ("Cypress Operating"),
an indirect subsidiary of Cypress Holding that provides in-building
networks and resells telecommunications services, to a new group of
shareholders.[^2]

Applicants assert that this transaction is entitled to presumptive
streamlined treatment pursuant to section 63.03(b)(1)(ii) of the
Commission's rules[^3] because neither THC nor any of its affiliates is
a telecommunications provider.

Cypress Operating is a Delaware corporation with its principal place of
business in Atlanta, Georgia. Cypress holds blanket domestic Section 214
authorization and provides bundled telecommunications services to small
and medium-sized businesses located in multi-tenant commercial office
buildings in the following markets: Atlanta, Birmingham, Boston,
Chicago, Dallas, Denver, Hartford, Houston, Indianapolis, Miami,
Minneapolis, Nashville, New Orleans, New Jersey, New York, Orlando,
Philadelphia, Phoenix, Pittsburgh, Portland, San Francisco, Seattle,
Southern California (Los Angeles and Orange County), Tampa, and
Washington, D.C. Cypress offers integrated service bundles that include
local, long distance, and international telecommunications services;
high-speed Internet connectivity; e-mail services; fully-managed
firewall services; web hosting; virtual private networks; feature-rich
digital desktop stations; calling cards; audio and web conferencing; and
digital business television. Cypress delivers these services over
in-building networks that it owns and operates. However, Cypress does
not own or operate any switches or transmission facilities outside of
the multi-tenant buildings in which its customers are located. Rather,
Cypress's regulated telecommunications services are provided entirely on
a resale basis, using facilities and switches that are owned and
operated by other telecommunications carriers. Cypress Operating is a
wholly-owned subsidiary of Cypress Communications, Inc., which in turn
is a wholly-owned subsidiary of Cypress Holding.[^4] Cypress Holding is
a publicly-traded corporation organized under the laws of Delaware with
the same principal place of business as Cypress Operating. While several
of the existing shareholders in Cypress Holding hold a 10 percent or
greater equity interest in the company, no shareholder or group of
shareholders controls Cypress.

THC is a Delaware corporation established to affect the purchase of
Cypress Holding. THC is not a telecommunications carrier and holds no
Section 214 authority. THC is an indirect subsidiary of First Islamic
Investment Bank, E.C. ("FIIB"). FIIB is a joint stock company organized
under the laws of the Kingdom of Bahrain. Founded in 1996, FIIB is
headquartered in Bahrain with U.S. and U.K. subsidiary offices in
Atlanta and London. In the U.S., FIIB operates through Crescent Capital
Investments, Inc. ("Crescent"), a Delaware corporation headquartered in
Atlanta, Georgia, which is an indirect, wholly-owned U.S. subsidiary of
FIIB.

Crescent is principally engaged in identifying and structuring
investments for the benefit of its parent company, FIIB, and clients of
FIIB. With respect to FIIB's proposed investment in Cypress, Crescent
will provide management and strategic advice to FIIB post-close.
Crescent's management is comprised primarily of U.S. citizens who are
experienced in the banking and investment business.

While one shareholder holds approximately 10.5 percent of the ownership
interest in FIIB, and the employees of FIIB and Crescent collectively
hold approximately 11 percent of the ownership interest, no shareholder
or group of shareholders holds a controlling interest in FIIB, and there
are no voting or other agreements that would give control to one
shareholder or group of shareholders. Moreover, under the proposed
post-close ownership structure described below, no FIIB shareholder or
group of shareholders will have a 10 percent or greater equity or voting
interest in Cypress. Neither FIIB nor any of its affiliates currently
provide telecommunications services or hold a 10 percent or greater
direct or indirect equity interest in any entity providing
telecommunications services in the U.S. or abroad.

On November 5, 2004, TechInvest Acquisition, Inc. ("Merger
Corporation"),[^5] THC and Cypress Holding entered into an Agreement and
Plan of Merger (the "Merger Agreement"). Pursuant to the Merger
Agreement, Merger Corporation will merge with and into Cypress Holding,
with Cypress Holding being the surviving corporation and becoming a
direct, wholly-owned subsidiary of THC. Post-transaction, FIIB will
control Cypress, and no person will hold interests that would be
sufficient to constitute a 10 percent or greater equity or voting
interest in Cypress post-close or confer the ability to control Cypress.
The Merger Agreement provides that the existing shareholders of Cypress
Holding are entitled to receive in cash an amount equal to \$39,350,000,
subject to adjustment for changes in working capital prior to closing
and after repayment of certain indebtedness of Cypress Holding, for all
of the outstanding capital stock of Cypress Holding. The proposed
transaction will result in a change in ownership of Cypress, but the
management and operation of Cypress will continue largely unchanged. The
new owners will be largely passive foreign investors who are clients of
Crescent. The closing of the transaction is contingent upon receipt of
necessary regulatory approvals and the approval of the shareholders of
Cypress Holding.

All of the voting stock of THC will be held by 15 Cayman Island
entities, each a company limited by shares (collectively, the "Voting
Cayman Entities").[^6] The ownership of the voting stock will be divided
equally between these companies. Accordingly, each Voting Cayman Entity
will individually hold approximately 6.67 percent of the voting interest
in Cypress under the Commission's rules. In total, the voting stock of
THC will represent 2 percent of the aggregate equity value of THC. As
such, none of the Voting Cayman Entities will hold a 10 percent or
greater equity or voting interest in Cypress post-close. The ownership
interest in the Voting Cayman Entities will be held by approximately 50
international investors (the "International Investors"). Some of the
International Investors are also shareholders in FIIB, but none are
employees of FIIB or Crescent. Each International Investor has granted a
revocable proxy to First Islamic Investment Management Limited ("FIIM"),
a wholly-owned, indirect subsidiary of FIIB, to vote the investor's
shares on all matters. In addition, each Voting Cayman Entity has
entered into an administrative agreement with FIIM pursuant to which
FIIM will be authorized to vote the voting stock of THC and make all
major decisions on behalf of the Voting Cayman Entities. The boards of
directors of the Voting Cayman Entities consist entirely of FIIB
personnel. No International Investor or group of International Investors
will be allowed to hold ownership interests in the Voting Cayman
Entities that, separately or combined with any interest in FIIB, would
be sufficient to constitute a 10 percent or greater voting interest in
Cypress post-close or confer the ability to control Cypress. To the best
of THC's knowledge and belief, there are no voting arrangements or other
agreements to act in concert between or among the International
Investors.

After closing, FIIB expects to finance the merger in part through funds
raised in an offering of shares in offshore investment companies
("shares offering"). In connection with this shares offering, THC will
issue 18.99 percent of its non-voting common stock to each of four
Cayman Islands entities -- TechAccess Capital Limited, TechShield
Capital Limited, TechNet Capital Limited, and TechTV Capital Limited
(collectively, the "Non-Voting Cayman Entities") -- all of which are
holding companies organized under Cayman Islands law and limited by
shares. After closing, interests in these Cayman Islands entities will
be sold through a shares offering to non-U.S. persons. Shareholders of
FIIB, other than employees of FIIB and Crescent, will be eligible to
purchase and hold these shares. However, no investor in the Non-Voting
Cayman Entities will be allowed to hold an ownership interest in the
Non-Voting Cayman Entities that, separately or combined with the
investor's interest in FIIB, would be sufficient to constitute a 10
percent or greater equity interest in Cypress post-close.

THC common stock to be held by the Non-Voting Cayman Entities will not
confer voting rights. Accordingly, the investors in the Non-Voting
Cayman Entities who are not also shareholders in FIIB will be wholly
passive investors. They will not have any right or ability to direct or
influence the strategic decisions or the day-to-day operations of
Cypress, to nominate Cypress' directors, or to direct the hiring or
termination of Cypress's employees and management. Investors in the
Non-Voting Cayman Entities who are also shareholders in FIIB will be
largely passive investors. Any influence of these investors will be
limited to their ownership interests in FIIB.

Financing for the proposed merger will also be provided in part through
a shares offering to FIIP Limited ("FIIP"), a Cayman Islands company
limited by shares. FIIP is the corporate vehicle for participation in
THC by FIIB and Crescent employees. THC will issue 3.28 percent of its
non-voting common stock to FIIP. No employee of FIIB or Crescent will be
allowed to hold an ownership interest in FIIP that, separately or
combined with the employee's interest in FIIB, would be sufficient to
constitute a 10 percent or greater ownership interest in Cypress
post-close or confer the ability to control Cypress.

After the financing arrangements with the Non-Voting Cayman Entities and
FIIP are complete, FIIB will retain no more than 18.76% percent of the
non-voting stock in THC through a wholly-owned indirect subsidiary,
TechInvest Holdings Limited ("THL"), a Cayman Islands company limited by
shares. THL is a wholly-owned subsidiary of First Islamic Investment
Holdings Limited ("FIIH"), a holding company and Cayman Islands company
limited by shares, which is in turn a wholly-owned subsidiary of FIIB.

The Applicants assert that the proposed transaction is in the public
interest because it will allow the existing shareholders of Cypress to
exit the telecommunications business in an orderly fashion, and will
bring additional capital to Cypress, which will strengthen it and better
ensure that it remains a viable long-term competitor in the
telecommunications marketplace. Also, Applicants state that the proposed
transfer of control will not result in a change of carrier for Cypress'
customers. Immediately following consummation of the proposed
transaction, Cypress will continue to provide high-quality
communications services to its customers without interruption and
without immediate change in rates, terms or conditions. In fact, the
operations of Cypress Communications will largely continue to be
determined by many of the same management, technical, and customer
service personnel that currently oversee those operations.

Cypress further states that the proposed foreign ownership should not
present an issue because, while the company owns and controls
in-building networks, it does not own or operate any transmission or
switching facilities that are part of the public switched
telecommunications network or, indeed, any, facilities outside of the
buildings in which its customers are located.

**[GENERAL INFORMATION]{.underline}**

The transfer of control of assets identified herein has been found, upon
initial review, to be acceptable for filing as a streamlined
application. The Commission reserves the right to return any transfer of
control application if, upon further examination, it is determined to be
defective and not in conformance with the Commission's rules and
policies. Interested parties may file **comments on or before December
3, 2004,** and **reply comments on or before December 10, 2004**.[^7]
Unless otherwise notified by the Commission, Applicants are permitted to
transfer control on the 31^st^ day after the date of this notice.[^8]
Comments may be filed using the Commission's Electronic Comment Filing
System (ECFS) or by filing paper copies. *See Electronic Filing of
Documents in Rulemaking Proceedings*, 63 Fed. Reg. 24121 (1998).

Comments filed through the ECFS can be sent as an electronic file via
the Internet to \<http://www.fcc.gov/e-file/ecfs.html\>. Generally, only
one copy of an electronic submission must be filed. If multiple docket
or rulemaking numbers appear in the caption of this proceeding, however,
commenters must transmit one electronic copy of the comments to each
docket or rulemaking number referenced in the caption. In completing the
transmittal screen, commenters should include their full name, U.S.
Postal Service mailing address, and the applicable docket or rulemaking
number. Parties may also submit an electronic comment by Internet
e-mail. To get filing instructions for e-mail comments, commenters
should send e-mail to ecfs@fcc.gov, and should include the following
words in the subject line "get form \<your e-mail address\>." A sample
form and directions will be sent in reply.

Parties who choose to file by paper must file an original and four
copies of each filing. If more than one docket or rulemaking number
appears in the caption of this proceeding, commenters must submit two
additional copies for each additional docket or rulemaking number.
Filings can be sent by hand or messenger delivery, by commercial
overnight courier, or by first-class or overnight U.S. Postal Service
mail (although we continue to experience delays in receiving U.S. Postal
Service mail). The Commission's contractor, Natek, Inc., will receive
hand-delivered or messenger-delivered paper filings for the
Commission\'s Secretary at 236 Massachusetts Avenue, N.E., Suite 110,
Washington, D.C. 20002. The filing hours at this location are 8:00 a.m.
to 7:00 p.m. All hand deliveries must be held together with rubber bands
or fasteners. Any envelopes must be disposed of before entering 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 mail, Express Mail, and Priority Mail should be addressed to
445 12th Street, SW, Washington, D.C. 20554. All filings must be
addressed to the Commission\'s Secretary, Office of the Secretary,
Federal Communications Commission.

**In addition, one copy of each pleading must be sent to each of the
following:**

(1) the Commission's duplicating contractor, Best Copy and Printing,
    Inc., 445 12^th^ Street, S.W., Room CY-B402, Washington, D.C. 20554;
    e-mail: [www.bcpiweb.com;]() phone: 202-488-5300 fax: 202-488-5563;

(2) Tracey Wilson-Parker, Competition Policy Division, Wireline
    Competition Bureau, 445 12^th^ Street, S.W., Room 5-C437,
    Washington, D.C. 20554; e-mail: <tracey.wilson-parker@fcc.gov>;

(3) Alex Johns, Competition Policy Division, Wireline Competition
    Bureau, 445 12^th^ Street, S.W., Room 3-C403, Washington, D.C.
    20554; e-mail: <alexis.johns@fcc.gov>;

(4) Terri Natoli, Competition Policy Division, Wireline Competition
    Bureau, 445 12^th^ Street, S.W., Room 5-C234, Washington, D.C.
    20554; e-mail: <terri.natoli@fcc.gov>;

(5) Susan O'Connell, Policy Division, International Bureau, 445 12^th^
    Street, S.W., Room 7-B544, Washington, D.C. 20554; email:
    [susan.o'connell@fcc.gov](mailto:cynthia.bryant@fcc.gov); and

(6) James Bird, Office of General Counsel, 445 12^th^ Street, S.W., Room
    8-C824, Washington, D.C. 20554; e-mail: <james.bird@fcc.gov>.

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, SW, Room CY-A257, Washington, DC,
20554. They may also be purchased from the Commission's duplicating
contractor, Best Copy and Printing, Inc., Portals II, 445 12th Street,
SW, Room CY-B402, Washington, DC, 20554, telephone: 202-488-5300, fax:
202-488-5563, or via e-mail [www.bcpiweb.com](http://www.bcpiweb.com/).

For further information, please contact Tracey Wilson-Parker at (202)
418-1394, or Alex Johns at (202) 418-1167.

\- **FCC** -

[^1]: 47 C.F.R §§ 63.03, 63.04; *see* 47 U.S.C. § 214.

[^2]: Applicants have also filed a transfer of control application
    related to international services. Any action on this domestic
    section 214 application is without prejudice to Commission action on
    other related pending applications.

[^3]: 47 CFR § 63.03(b)(1)(ii).

[^4]: Cypress Holding, together with Cypress Communications and Cypress
    Operating, are collectively referred to as "Cypress."

[^5]: Merger Corporation is a Delaware corporation and wholly-owned
    subsidiary of THC that was incorporated for the sole purpose of
    entering into the Merger Agreement and consummating the transactions
    contemplated thereby.

[^6]: These companies are Amity Investment III Limited; Brace Investment
    III Limited; Coalition Investment III Limited; Enable Investment III
    Limited; Federation Investment III Limited; Group Investment III
    Limited; League Investment III Limited; Order Investment III
    Limited; Patron Investment III Limited; Society Investment III
    Limited; Tutor Investment III Limited Joint Investment III Limited;
    Matrix Investment III Limited; United Investment III Limited; and
    Yield Investment III Limited.

[^7]: *See* 47 C.F.R. § 63.03(a).

[^8]: Such authorization is conditioned upon receipt of any other
    necessary approvals from the Commission in connection with the
    proposed transaction.