DA 02-1316

June 6, 2002

**CELLULAR RURAL SERVICE AREAS**

**AUCTION CLOSES**

**Winning Bidders Announced**

Down Payments Due June 20, 2002

FCC Forms 601 and 602 Due June 20, 2002

*Ten-Day Petition to Deny Period*

**Report No. AUC-02-45-F (Auction No. 45)**

On June 4, 2002, the Federal Communications Commission completed the
auction of three cellular Rural Service Area (RSA) licenses ("Auction
No. 45"), raising (in net high bids) a total of \$15,871,000 for the
U.S. Treasury. Three winning bidders won a total of 3 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, and
both the gross and net high winning bid amounts.

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

**Attachment C:** "Instructions for Completing FCC Form 601" provides
detailed information about how a winning bidder should complete the
required FCC Form 601 and FCC Form 602 for cellular RSA license
applications.

> **Attachment D:** "Instructions for Using ULS to Associate Call Signs
> With the FRN and File FCC Form 601 Electronically."
>
> **Attachment E: "**Accessing the FCC Network using Windows 95/98 for
> ULS 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
June 20, 2002**, winning bidders in Auction No. 45 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down payments on winning bids, and 2) payments for withdrawn bids, if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.[^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cover the required total of down payments and withdrawn bid payments (as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[^2], 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.[^3] 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).[^4]

## 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).[^5] 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 Gail
Glasser at 202-418-0578 or Tim Dates at 202-418-0496. **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 June 20, 2002**. 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"
>
> APPLICANT'S TAXPAYER IDENTIFICATION NO.: (same as FCC Form 159, Block
> 22)
>
> APPLICANT'S FCC REGISTRATION NO. (FRN): (same as FCC Form 159, Block
> 21)
>
> PAYMENT TYPE CODE: (enter "A45D")
>
> FCC CODE 1: (same as FCC Form 159, Block 28A: "45")
>
> 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 (TIN) / FCC Registration Number (FRN) used on
their FCC Form 175.**[^6] Questions concerning the calculation and
submission of down payments should be directed to Gail Glasser at
202-418-0578 or Tim Dates at 202-418-0496.

## 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.[^7] In Auction
No. 45 there were no bid withdrawals during the course of the auction.
If a high bidder defaults or is disqualified after the close of the
auction, the defaulting bidder will be subject to the following payment
obligations: 1) the difference between the high bid and the amount of
the winning bid the next time the license is offered by the Commission,
and 2) 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 June 20, 2002, 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 license(s) to existing or new
applicants, or offer it to the other highest bidders (in descending
order) at their final bids.[^8]

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.[^9] 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).[^10] In such event, the Commission may either auction the
license(s) to existing or new applicants or offer it to the other
highest bidders (in descending order) at their final bids.[^11]

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.[^12]

## 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 at 202-418-0578 or Tim Dates at
202-418-0496.

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

By **6:00 p.m. ET on June 20**, **2002** winning bidders must submit a
completed long-form license application(s) covering each license for
which they were the winning high bidder. **Attachment C** 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 D**.

**Failure to timely file FCC Form 601 will result in default. Late-filed
applications will not be accepted without a showing of good
cause.**[^13]

## 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 C.

## 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.[^14] 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 C. 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 C.

## I. Maintaining Accuracy of Information {#i.-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.

## J. Application Processing and License Grant {#j.-application-processing-and-license-grant .unnumbered}

Pursuant to 47 C.F.R. § 1.2108(b) and the Balanced Budget Act of
1997,[^15] 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.[^16] The petitioner may file a reply to such opposition within
**five (5) business days** after the time for filing oppositions has
expired.[^17] 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.[^18]

## K. Anti-collusion Rules {#k.-anti-collusion-rules .unnumbered}

To ensure the competitiveness of the auction process, the Commission's
rules prohibit competing 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. 45 Procedures Public Notice*,[^19] this prohibition began
with the filing of short-form applications and ends on the down payment
due date, or June 20, 2002.[^20] 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.

## L. Return of SecurID Cards {#l.-return-of-securid-cards .unnumbered}

Bidders are encouraged to return their SecurID cards to the FCC by
**June 20, 2002** for recycling. The Commission will send bidders a copy
of this *Public Notice* and a pre-addressed, stamped envelope. All
bidders should use the envelope 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 202-418-0578 or 202-418-0496      |
| Auctions Accounting Group     |                                      |
|                               |                                      |
| (Payment, FCC Form 159 and    |                                      |
| refund questions)             |                                      |
+-------------------------------+--------------------------------------+
|                               |                                      |
+-------------------------------+--------------------------------------+
| Wireless Telecommunications   | Dwain Livingston, Engineer, at       |
| Bureau,                       | 202-418-1338                         |
|                               |                                      |
| Commercial Wireless Division  | Michael Kleeb, Analyst, at           |
|                               | 202-418-1306                         |
+-------------------------------+--------------------------------------+
| (FCC Form 601and 602          | Evan Baranoff, Attorney, at          |
| questions)                    | 202-418-7142                         |
+-------------------------------+--------------------------------------+
|                               | Amal Abdallah, Attorney, at          |
|                               | 202-418-7307                         |
+-------------------------------+--------------------------------------+
|                               |                                      |
+-------------------------------+--------------------------------------+
| Wireless Telecommunications   | Barbara Sibert, Project Manager at   |
| Bureau, Auctions and Industry | 717-338-2888                         |
| Analysis Division             |                                      |
| (Auction-related questions)   | Denise Coca, Attorney, at            |
|                               | 202-418-0660                         |
+-------------------------------+--------------------------------------+

\- FCC -

[^1]: 47 C.F.R. §§ 1.2104(g), 1.2107(b). 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.
    47 C.F.R. § 1.2104(g)(1).

[^2]: 47 C.F.R. § 1.2108.

[^3]: 47 C.F.R. §§ 1.2107(b), 1.2109.

[^4]: 47 C.F.R. § 1.2109(a).

[^5]: 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 calling the Commission's
    Fax-On-Demand at 202-418-2830.

[^6]: 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.

[^7]: 47 C.F.R. §§ 1.2104(g), 1.2109.

[^8]: 47 C.F.R. § 1.2109(b).

[^9]: 47 C.F.R. § 1.2109(a).

[^10]: 47 C.F.R. § 1.2104(g)(2).

[^11]: 47 C.F.R. § 1.2109(c).

[^12]: 47 C.F.R. § 1.2109(d).

[^13]: 47 C.F.R. § 1.2107(c).

[^14]: 47 C.F.R. § 1.919. *See* 47 C.F.R. § 1.2107(f).

[^15]: Pub. L. No. 105-33, 111 Stat. 251 (1997).

[^16]: *See* 47 C.F.R. § 1.2108(c).

[^17]: *See id.*

[^18]: *See* Commission Taking Tough Measures Against Frivolous
    Pleadings, *Public Notice*, 11 FCC Rcd 3030 (1996).

[^19]: *See* Auction No. 45 Cellular Rural Service Areas Auction
    Scheduled for May 29, 2002; Notice and Filing Requirements, Minimum
    Opening Bids, Upfront Payments and Other Auction Procedures, *Public
    Notice*, DA 02- 470 (rel. March 4, 2002), 67 Fed. Reg. 16383 (rel.
    April 5, 2002) ("*Auction No. 45 Procedures Public Notice*").

[^20]: *Auction No. 45 Procedures Public Notice* at 3.