DA 01-2858

December 11, 2001

**LOWER AND UPPER PAGING BANDS**

**AUCTION CLOSES**

**Winning Bidders Announced**

Down Payments Due December 27, 2001

FCC Forms 601 and 602 Due December 27, 2001

*Ten-Day Petition to Deny Period*

**Report No. AUC-01-40-N (Auction No. 40)**

On December 5, 2001, the Federal Communications Commission completed the
auction of 15,514 licenses in the Lower and Upper Paging Bands Auction
("Auction No. 40"), raising (in net high bids) a total of \$12,897,127
for the U.S. Treasury. 182 winning bidders won a total of 5,323 licenses
in this auction.

This *Public Notice* provides detailed information concerning winning
bidders, down payments, bid withdrawal payments and/or deposits, FCC
Forms 601 and 602 filing requirements, requests for rule waivers, and
licensing matters. Key information appears in the following attachments:

**Attachment A:** "Round Results, High Bids" lists winning bidders, the
number of licenses they won, and both their total gross and net high
winning bid amounts. In previous auctions, Attachment A has listed the
winning bidder and bid amounts for each license. However, due to the
large volume of licenses in Auction No. 40, a list of the licenses won
will be provided in electronic format only, available with this public
notice at http://wireless.fcc.gov/auctions/40/.

> **Attachment B:** "Bidder Payment/Refund Report" lists down payments
> and withdrawal bid payments owed by winning bidders, if any.

**Attachment C: "**Withdrawal/Payment Report" lists withdrawal bid
payments owed by all bidders.

**Attachment D:** "Multi-Auction Withdrawal Payment Report" lists
amount(s) or refund(s) due for bidders in Auction No. 26 based upon
reconciliation of final results of Auction No. 26 and Auction No. 40.

**Attachment E:** "Instructions for Completing FCC Form 601 for Paging
License Applicants" provides detailed information about how a winning
bidder should complete the required FCC Form 601 and FCC Form 602 for
paging license applications.

> **Attachment F:** "Instructions for Using ULS to Register FRN and Call
> Signs With FCC and File FCC Form 601 Electronically."
>
> **Attachment G: "**Accessing the FCC Network using Windows 95/98 for
> Universal Licensing System Filing."
>
> A copy of this *Public Notice* will be sent via overnight mail to each
> winning bidder.

## Down Payments

The Commission's rules require that within ten business days after the
release of this *Public Notice*, in this case before **6:00 p.m. ET on
December 27, 2001**, winning bidders in Auction No. 40 must have on
deposit with Mellon Bank in Pittsburgh, Pennsylvania, enough funds to
cover 1) down payments on winning bids, and 2) payments for withdrawn
bids, if applicable. If a winning bidder's upfront payment is not
sufficient to meet both of these requirements, the winning bidder must
deposit additional funds. *See* 47 C.F.R. §§ 1.2104(g),1.2107(b).[^1]

The amount now due from each winning bidder, if any, is set out in the
last column of **Attachment B**. *Note that a payment and FCC Form 159
are necessary only if a winning bidder's upfront payment **does not**
cover the required total of down payments and withdrawn bid payments (as
reflected in Attachment B).* Each winning bidder's down payment must be
a total of any withdrawal payments (if applicable) plus twenty (20)
percent of its net winning bid(s).

## Final Payments

After the termination of the licensing pleading cycle (*see* 47 C.F.R. §
1.2108), the Commission will issue a public notice announcing that it is
prepared to grant the licenses. Within ten business days after the date
of that public notice, winning bidders will be required to make full
payment of the balance of their winning bids. *See* 47 C.F.R. §§
1.2107(b), 1.2109. Licenses will be granted only after the full and
timely payment of winning bids and any applicable late fees, in
accordance with Section 1.2109(a). *See* 47 C.F.R. §1.2109(a).

## Method of Payment

All payments must be in U.S. dollars and made in the form of a wire
transfer. No personal checks, credit card payments, or other forms of
payment will be accepted. All payments must be accompanied by a
completed FCC Remittance Advice Form (FCC Form 159).[^2] If applicable,
a partially completed copy of the FCC Form 159 will be sent along with
this *Public Notice* to facilitate submission of the correct down
payment. Questions regarding FCC Form 159 should be addressed to Tim
Dates or Gail Glasser at 202-418-1995**. Please note, however, that
winning bidders are ultimately responsible for insuring the verification
and submission of the correct down payment from their bank to Mellon
bank**.

**Wire transfers for down payments** must be **received** by Mellon Bank
by **6:00 p.m. ET, on December 27, 2001**. Winning bidders should
coordinate with their bankers ahead of time regarding their wire
transfers, and allow sufficient time for the wire transfer to **be
initiated and completed prior to the deadline**.

To submit funds by wire transfer, winning bidders will need the
following information:

> ABA Routing Number: 043000261
>
> Receiving Bank: Mellon Pittsburgh
>
> BNF: FCC Account Number 910-6106
>
> OBI Field: (Skip one space between each information item) "AUCTIONPAY"
>
> TAXPAYER IDENTIFICATION NO.: (same as FCC Form 159, Block 12)
>
> PAYMENT TYPE CODE: (enter "A40D")
>
> FCC CODE 1: (same as FCC Form 159, Block 28A: "40")
>
> PAYOR NAME: (same as FCC Form 159, Block 2)
>
> LOCKBOX NO.: 358850

Winning bidders must fax a completed FCC Form 159 to Mellon Bank at
412-209-6045 at least one hour before placing the order for the wire
transfer (but on the same business day).

Proper completion of the FCC Form 159 is critical to ensuring correct
credit of bidder deposits. **Winning bidders must use the same Taxpayer
Identification Number used on their FCC Form 175.**[^3] Questions
concerning the calculation and submission of down payments should be
directed to Gail Glasser at 202-418-1995.

> **D. Withdrawal, Default and Disqualification Payments**

The Commission imposes payments on bidders that withdraw high bids
during the course of an auction, those that default on payments due
after an auction closes, or those that are disqualified. *See* 47 C.F.R.
§§ 1.2104(g), 1.2109.

*1. Bid Withdrawal Payments.* A bidder (Bidder X) that withdraws a high
bid during the course of an auction is subject to a bid withdrawal
payment equal to the difference between the amount withdrawn and the
amount of the subsequent winning bid. No withdrawal payment will be
assessed for a withdrawn bid if either the subsequent winning bid or any
of the intervening subsequent withdrawn bids equals or exceeds that
withdrawn bid. If a high bid is withdrawn on a license that remains
unsold at the close of the auction, Bidder X will be required to make an
interim payment equal to three (3) percent of the net amount of the
withdrawn bid. [^4] This payment amount is deducted from any upfront
payments or down payments that Bidder X has deposited with the
Commission. If, in a subsequent auction, that license receives a valid
bid in an amount equal to or greater than the withdrawn bid amount, then
no final bid withdrawal payment will be assessed, and upon appropriate
request, the Commission will refund the interim three (3) percent
payment. If, in a subsequent auction, the winning bid amount for that
license is less than Bidder X's withdrawn bid amount, then Bidder X will
be required to make a final bid withdrawal payment equal to either the
difference between Bidder X's net withdrawn bid and the subsequent net
winning bid, or the difference between Bidder X's gross withdrawn bid
and the subsequent gross winning bid, whichever is less. The three (3)
percent interim payment will be applied toward the withdrawal payment.

**Attachment C** identifies bidders that owe withdrawal payments to the
Commission as a result of bid withdrawals made in Auction No. 40. Any
upfront payments or down payments that the withdrawing bidder has
deposited with the Commission will first be applied to satisfy the
withdrawal payment(s) amount before being applied towards a winning
bidder's down payment. *See* 47 C.F.R. §1.2104(g)(1).

*2. Bid Default/Disqualification Payments.* If a high bidder defaults or
is disqualified after the close of the auction, the defaulting bidder
will be subject to the same bid withdrawal payment obligations as
described above, plus an additional payment equal to three (3) percent
of the subsequent winning bid or three (3) percent of the defaulted bid,
whichever is less. Where a bidding credit applies to the winning bid in
either the original or the subsequent auction, the calculation of the
three percent payment is based on the smaller of the two gross bids or
smaller of the two net bids, whichever basis (gross or net) was used to
figure the first component. Thus, if the difference between the gross
bids is less than the difference between the net bids, the three percent
payment will be computed on the lower of the gross bids. If the
difference between the net bids is less than or equal to the difference
between the gross bids, the three percent payment will be computed on
the lower of the net bids. However, if both the difference between the
gross bids and the difference between the net bids are less than or
equal to zero, the three percent payment will be computed on the lower
of the net bids.

If a winning bidder fails to remit the required down payment within ten
(10) business days after the Commission has released this *Public
Notice*, in this case by December 27, 2001, the bidder will be deemed to
have defaulted, its application will be dismissed, and it will be liable
for a default payment as described above. In such event, the Commission,
at its discretion, may either auction the spectrum to existing or new
applicants, or offer it to the other highest bidders (in descending
order) at their final bids. *See* 47 C.F.R. § 1.2109(b).

If a winning bidder fails to pay the balance of its winning bids in a
lump sum by the applicable deadline as specified by the Commission, it
will be allowed to make payment within ten (10) business days after the
payment deadline provided that it also pays a late fee equal to five (5)
percent of the amount due. When a winning bidder fails to pay the
balance of its winning bid plus late fee by the late payment deadline,
it is considered to be in default on its license(s) and subject to the
applicable default payments.

Licenses will be awarded upon the full and timely payment of winning
bids and any applicable late fees. *See* 47 C.F.R. §1.2109(a). A winning
bidder that is found unqualified to be a licensee, fails to remit the
balance of its winning bid in a timely manner, or defaults or is
disqualified for any reason after having made the required down payment,
will be deemed to have defaulted and will be liable for the payment set
forth in Section 1.2104(g)(2). In such event, the Commission may either
auction the spectrum to existing or new applicants or offer it to the
other highest bidders (in descending order) at their final bids. *See*
47 C.F.R. § 1.2109(c).

Additionally, bidders that are found to have violated the antitrust laws
or the Commission's rules in connection with their participation in the
competitive bidding process may be subject, in addition to any other
applicable sanctions, to forfeiture of their upfront payment, down
payment, or full bid amount, and may be prohibited from participating in
future auctions. *See* 47 C.F.R. § 1.2109(d).

## E. Refund of Excess Upfront Payments  {#e.-refund-of-excess-upfront-payments .unnumbered}

Upfront monies on deposit that are in excess of the required down
payment, withdrawal and/or default payment amounts will be refunded to
the payer of record as identified on FCC Form 159 promptly upon receipt
of the necessary wire transfer instructions. Such instructions must be
faxed to Gail Glasser at 202-418-2843. Any questions concerning refunds
should be referred to Gail Glasser or Tim Dates at 202-418-1995.

## F. FCC Form 601  {#f.-fcc-form-601 .unnumbered}

By **6:00 p.m. ET on December 27, 2001**, winning bidders must submit a
completed long-form license application(s) covering each license for
which they were the winning high bidder. **Attachment E** sets out
instructions for completing the FCC Form 601. Applications **must** be
filed electronically. Detailed instructions for filing the Form 601
electronically are set out in **Attachment F**.

**Failure to timely file FCC Form 601 will result in default. Late-filed
applications will not be accepted without a showing of good cause.**[^5]

## G. Tribal Land Bidding Credit {#g.-tribal-land-bidding-credit .unnumbered}

The Commission has implemented a tribal land bidding credit to encourage
the growth of wireless services in federally recognized tribal lands.
For information relating to the tribal land bidding credit, *see*
Attachment E.

## H. FCC Form 602 {#h.-fcc-form-602 .unnumbered}

Pursuant to Section 1.919 of the Commission's rules, an applicant for a
license in an auctionable service must have on file with the Commission
a current FCC Form 602 regarding ownership information of the applicant.
*See* 47 C.F.R. § 1.919. Therefore, unless the applicant already has a
current FCC Form 602 on file with the Commission, the applicant must
submit one at the time the FCC Form 601 is filed. Any late-filed FCC
Form 602 must contain a request for waiver of the filing requirement in
47 C.F.R. § 1.919.

FCC Form 602 must be filed **manually** (not electronically), and may be
obtained from the Internet at http://www.fcc.gov/formpage.html or by
calling the FCC's Form Distribution Center at 1-800-418-FORM (3676)
(outside Washington, D.C.) or 202-418-3676 (in the Washington D.C.
area). For more detailed information on FCC Form 602, *see* "Wireless
Telecommunications Bureau Answers Frequently Asked Questions Concerning
Reporting of Ownership Information on FCC Form 602," *Public Notice*, DA
99-1001, 14 FCC Rcd 8261 (1999).

Applicants that do not have a current FCC Form 602 on file should send
the form to:

Federal Communications Commission

Rear entrance 35 York Street

Gettysburg, PA 17325

Filing an FCC Form 602 is a [separate]{.underline} requirement from, and
in addition to, the ownership reporting requirements associated with
filing FCC Form 601, Exhibit A, as set forth in Attachment E. However,
to avoid duplication, applicants may provide certain information
required in Exhibit A by attaching a copy of their FCC Form 602 (in
Adobe PDF Format) to their FCC Form 601 submission. Applicants are
reminded, however, that an original FCC Form 602 still must be filed
manually in Gettysburg, PA. For further information, see Instructions in
Attachment E.

## I. Applications for Multiple Licenses {#i.-applications-for-multiple-licenses .unnumbered}

Applicants winning licenses in multiple radio services must complete a
separate FCC Form 601 for each radio service. Applicants winning
multiple licenses may submit [one]{.underline} FCC Form 601 per service
(including all required schedules, attachments, and exhibits) and Form
602 if **all** filing information (name and address information, all
ownership and eligibility attachments, and waiver requests) associated
with the application is identical **except** for the market designator
and market name. Licensing information such as market designator, block,
and/or market name may be different (*i.e*., CPBEA001CA - Bangor, Maine;
CPBEA021CN - Greenville, North Carolina) or (*i.e*., CZMEA011AB - Miami;
CZMEA003AV - Buffalo).

Filers whose name and address, ownership, eligibility, and waiver
requests are identical for some licenses but different for other
licenses must submit a separate Form 601 and 602 for those licenses for
which filing information is unique. The streamlined filing procedure
described in the above paragraph may only be used for licenses that have
identical filing information.

Applicants seeking a tribal land bidding credit for one or more markets
are encouraged to submit two applications. One application would include
markets in which the applicant intends to apply for a tribal land
bidding credit. The other application would include those markets in
which the applicant is not seeking a tribal land bidding credit.
Applicants that intend to seek a tribal land bidding credit in multiple
services would need to submit two applications per service.

## J. Maintaining Accuracy of Information {#j.-maintaining-accuracy-of-information .unnumbered}

After the auction closes, applicants are required to make all changes in
the ULS system (Form 601).

Applicants are no longer required to maintain accuracy and completeness
of information furnished on their FCC Form 175 and exhibits.

## K. Application Processing and License Grant {#k.-application-processing-and-license-grant .unnumbered}

Pursuant to 47 C.F.R. § 1.2108(b) and the Balanced Budget Act of 1997,
Pub. L. 105-33, 111 Stat. 251 (1997), interested parties will have **ten
(10) days** to file petitions to deny after the Commission releases a
public notice announcing the FCC Forms 601 and 602 that are acceptable
for filing. An applicant may file an opposition to any petition to deny
within **five (5) business days** after the time for filing petitions to
deny has expired. *See* 47 C.F.R. §1.2108(c). The petitioner may file a
reply to such opposition within **five (5) business days** after the
time for filing oppositions has expired. *See* 47 C.F.R. §1.2108(c). If
the Commission determines an applicant is qualified and there is no
substantial and material issue of fact concerning that determination,
the Commission will issue a public notice announcing that it is prepared
to grant the application conditioned upon the full and timely payment of
the remaining balance of the applicant's winning bid. Once the
Commission has received full payment of the applicant's winning bid, it
will issue a public notice announcing grant of the license (or licenses)
to the applicant.

*Frivolous Pleadings.* The Commission reminds parties to our proceedings
and their attorneys that the Commission intends to use its authority
fully to deter the filing of frivolous pleadings. *See* Commission
Taking Tough Measures Against Frivolous Pleadings, *Public Notice*, 11
FCC Rcd 3030 (1996).

## L. Anti-collusion Rules {#l.-anti-collusion-rules .unnumbered}

To ensure the competitiveness of the auction process, the Commission's
rules prohibit applicants for the same geographic license area from
communicating with each other during the auction about bids, bidding
strategies, or settlements. As explained more fully in the *Auction No.
40 Procedures Public Notice*,[^6] this prohibition began with the filing
of short-form applications and ends on the down payment due date, or
December 27, 2001.[^7] The prohibition ends on the down payment due date
whether or not a high bidder must supplement its upfront payment to
cover its down payment. Applicants certified their compliance with
Section 1.2105(c) when their FCC Form 175 short-form applications were
signed.

## Return of SecurID Cards

Bidders are encouraged to return their SecurID cards to the FCC by
**December 27, 2001** for recycling. A pre-addressed, stamped envelope
is provided in this mailing that bidders should use to return the cards
now that the auction is over. Please note that each SecurID card is
tailored to a specific auction, therefore, the cards issued for this
auction will not work for future auctions.

\* \* \* \* \*

**For further information, contact**

+-------------------------------+--------------------------------------+
| News Media:                   | Meribeth McCarrick at 202-418-0654   |
+-------------------------------+--------------------------------------+
|                               |                                      |
+-------------------------------+--------------------------------------+
| Technical Support Hotline:    | Technical Support Personnel at       |
|                               |                                      |
|                               | 202-414-1250 (V)                     |
|                               |                                      |
|                               | or 202-414-1255 (text telephone      |
|                               | (TTY))                               |
+-------------------------------+--------------------------------------+
|                               |                                      |
+-------------------------------+--------------------------------------+
| Office of the Managing        | Gail Glasser or Tim Dates            |
| Director                      |                                      |
|                               | at 202-418-1995                      |
| Auctions Accounting Group     |                                      |
|                               |                                      |
| (Payment, FCC Form 159 and    |                                      |
| refund questions)             |                                      |
+-------------------------------+--------------------------------------+
|                               |                                      |
+-------------------------------+--------------------------------------+
| Wireless Telecommunications   | Bettye Woodward, Industry Analyst,   |
| Bureau,                       | at 202-418-1345                      |
+-------------------------------+--------------------------------------+
| Commercial Wireless Division  | Gary Oshinsky, Attorney, at          |
|                               | 202-418-7167                         |
+-------------------------------+--------------------------------------+
| (FCC Form 601and 602          | Amal Abdallah, Attorney, at          |
| questions)                    | 202-418-7307                         |
+-------------------------------+--------------------------------------+
|                               |                                      |
+-------------------------------+--------------------------------------+
| Wireless Telecommunications   | Lisa Stover, Project Manager at      |
| Bureau, Auctions and Industry | 717-338-2888                         |
| Analysis Division             |                                      |
| (Auction-related questions)   | Erik Salovaara, Attorney, at         |
|                               | 202-418-0660                         |
+-------------------------------+--------------------------------------+

\- FCC -

[^1]: *See* 47 C.F.R. § 1.2104(g)(1). In the event a bidder has
    withdrawn a bid(s) and is subject to a bid withdrawal payment(s),
    the bidder's upfront payment will be first applied to satisfy the
    withdrawal payment(s) before being applied toward its down payment.

[^2]: Copies of the FCC Form 159 may be obtained by calling the
    Commission's Forms Distribution Center at 1-800-418-3676 (outside
    Washington, D.C.) or 202-418-3676 (in the Washington D.C. area).
    Copies of the FCC Form 159 can also be obtained via the Internet
    (http://www.fcc.gov/formpage.html) or by Fax-On-Demand
    (202-418-2830).

[^3]: If, subsequent to final submission of its FCC Form 175, a bidder
    has provided the Commission with a written correction of its
    Taxpayer Identification Number, the bidder should use the corrected
    number.

[^4]: 47 C.F.R. § 1.2104(g)(1); Amendment of Part 1 of the Commission's
    Rules -- Competitive Bidding Procedures, WT Docket No. 97-82, *Order
    on Reconsideration of the Third Report and Order*, *Fifth Report and
    Order, and Fourth Further Notice of Proposed Rule Making*, 15 FCC
    Rcd 15293, 15301-02 (2000); *see* Implementation of Section 309(j)
    of the Communications Act -- Competitive Bidding, PP Docket No.
    93-253, *Fifth Report and Order*, 9 FCC Rcd 5532, 5563 n.51 (1994);
    *see also* Phase II 220 MHz Service Auction Closes, Winning Bidders
    in the Auction of 908 Phase II 220 MHz Service Licenses, *Public
    Notice*, 14 FCC Rcd 605 (1999).

[^5]: 47 C.F.R. § 1.2107(c).

[^6]: *See* Lower and Upper Paging Bands Auction Scheduled for June 26,
    2001; Notice and Filing Requirements, Minimum Opening Bids, Upfront
    Payments and Other Procedural Issues, *Public Notice*, DA 01-850, 16
    FCC Rcd 7657 (2001) ("*Auction No. 40 Procedures Public Notice*").

[^7]: *Id*. at 7664-65.