Attachment Hawaiian Telcom AFF

Hawaiian Telcom AFF

PUBLIC NOTICE

Public Notice

2010-03-11

This document pretains to ITC-ASG-20100122-00038 for Assignment on a International Telecommunications filing.

IBFS_ITCASG2010012200038_805411

Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D.C. 20554 In the Matter of HAWAIIAN TELCOM, INC. and HAWAIIAN TELCOM SERVICES COMPANY, INC. (Debtors-in-Possession) WC Docket No. 10-41 Application for Consent to Transfer Control of Domestic Authorizations Under Section 214 of the Communications Act, as Amended SUPPLEMENTAL INFORMATION Hawaiian Telcom, Inc. (“HTI”) and Hawaiian Telcom Services Company, Inc. (“HT Services,” and together with HTI, the “Applicants”) hereby provide certain additional information to supplement their Applications for transfer of control, 1 as requested by the Federal Communications Commission’s (“Commission” or “FCC”) staff. 2 1 Hawaiian Telcom, Inc. and Hawaiian Telcom Services Company, Application for Consent to Transfer Control of Domestic Authorizations Under Section 214 of the Communications Act, as Amended, WC Docket No. 10-41 (filed Jan. 22, 2010) (“Application”). Related applications and petitions are associated with file numbers: ITC-ASG-20100122-00038; ISP-PDR-20100122-00002; and 0004095753. 2 The information included herein was requested by James Ball of the FCC’s International Bureau on March 23, 2010.

1. Description of Types of Common Carrier Licenses Please provide a description of the types of common carrier licenses (by service) held by Hawaiian Telcom. HTI holds the following types of common carrier licenses: • Domestic Section 214 Authorizations • International Section 214 Authorizations • Common Carrier Fixed Point-to-Point Microwave • Rural Radiotelephone • Basic Exchange Telephone Radio Service • Local Television Transmission HT Services holds the following types of common carrier licenses: • Domestic Section 214 Authorizations • International Section 214 Authorizations 2. Information Regarding Trading and Additional Shares of Holdco Stock The petition for declaratory ruling (at pg. 10) and Appendix A to the transfer application (at pg. 3) state that the Holdco common stock “may” or “will be” traded publicly. Does Holdco have an anticipated date by which public trading is expect to commence? Is Holdco able to state whether it anticipates offering additional shares in the company upon closing? If so, is the Company able to state the percentages of total capital stock and of voting stock that it plans to offer publicly and the diluting effect such offering may have on the Creditor interests? The Applicants are seeking to have public trading of the new common stock of Hawaiian Telcom Holdco, Inc. (“Holdco”) commence shortly after the company emerges from bankruptcy. When and if this will occur is dependent upon obtaining the necessary approvals from the FCC and the Hawaii Public Utilities Commission and successful registration of the new common stock with the Securities and Exchange Commission and listing of the company with the NASDAQ Stock Exchange. Holdco does not expect to offer additional shares in the company upon emergence from Chapter 11, with the exception of the following, as provided for in the Plan of Reorganization: 2

• new common stock issued in connection with the rights offering, which is explained in further detail below • the 10 percent of shares of new common stock reserved for the company’s management equity incentive program to be implemented following emergence from Chapter 11, and • the potential exercise of the warrants for new common stock that will be distributed upon emergence to eligible senior notes claim holders (as defined below). No shares will be offered to the public upon emergence from bankruptcy. Also, to clarify, all of the “capital stock” is “voting stock.” 3. Explanation of Rights Offering The petition for declaratory ruling refers to “the rights offering” (at pgs. 2-3). Please explain the reference to the rights offering. Pursuant to the Plan of Reorganization, certain senior notes holders with allowed claims (the “eligible senior notes claim holders”) who certified that they were qualified institutional buyers as defined in Rule 144A 3 under the Securities Act of 1933, as amended, (“1933 Act”) or accredited investors as defined in Rule 501 4 of the 1933 Act received subscription rights entitling them to purchase their pro rata share of 3,125,000 shares of the new Holdco common stock to be issued upon emergence from Chapter 11 or as soon as practicable thereafter. The rights offering commenced on October 14, 2009 and expired on November 16, 2009. Holders of subscription rights intending to participate in the rights offering were required to elect to exercise their subscription rights and pay the subscription purchase price of $16.00 per share prior to the expiration of the rights offering. The rights offering was subject to a minimum participation of 3 17 C.F.R. § 230.144A. 4 17 C.F.R. § 230.501. 3

$1,000,000.00. A total of three eligible senior notes claim holders timely exercised their subscription rights, paying a total of $2,161,008.00 for the right to receive a total of 135,063 shares of new Holdco common stock upon emergence from Chapter 11. 4. Information Regarding Holdco Stock Trading Restrictions The petition states (at pg. 5) that the Holdco common stock “may become” subject to certain trading restrictions for two years. Appendix A to the transfer application states (at pgs. 3-4) that the Holdco common stock “will be” subject to the restrictions. Please explain which is the correct statement. Assuming the necessary approvals are obtained to allow the new Holdco common stock to be publicly traded, the stock will be subject to restrictions preventing any person or entity that controls 4.75 percent or more of the new common stock from acquiring any additional shares without prior approval from the Holdco Board of Directors for at least two years following emergence from Chapter 11. These trading restrictions are necessary to preserve important tax benefits of the company. 5. Information Regarding Post-Bankruptcy Equity and/or Voting Interests 5 To obtain the information requested by the Commission staff, a supplemental survey was conducted of each of the more than one hundred entities that held claims in the Hawaiian Telcom bankruptcy estate as of December 18, 2009, the date used for compiling the information in the Petition for Declaratory Ruling (the “Record Date”). Lehman Commercial Paper, Inc. (“Lehman”) in its role as administrative agent for the secured lenders, together with Lehman’s legal counsel and Houlihan Lokey, Lehman’s financial advisor, assisted with the survey. The survey was conducted by circulating to all of the lenders a questionnaire seeking data on each of the specific factors identified by 5 For Holdco, the “Equity Interests” and the “Voting Interests” are the same. 4

Commission staff, and then following up with individual lenders to obtain responses to the extent practicable if the questionnaires were not returned in a timely manner. Although the lenders are under no legal obligation to provide such information to the Applicants, lenders holding approximately 86.4 percent of the prospective equity in Holdco responded to this supplemental inquiry. As noted in the Applicant’s prior filings, claims against the bankruptcy estate may be traded among the claim holders and with third parties. Because of this trading activity, while the information provided herein reflects claim holdings as of the Record Date, individual prospective equity ownership interests can and will change as described in prior filings. Based on the information collected in this new survey as well as the information gathered previously, the following chart summarizes the information obtained by Applicants. 6 6 A declaration attesting to the accuracy of the ownership information is attached hereto as an Exhibit. 5


Document Created: 2010-03-11 12:27:23
Document Modified: 2010-03-11 12:27:23
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