FCC 24.720 Revised as of October 1, 2005
Goto Year:2004 |
2006
Sec. 24.720 Definitions.
(a) Scope. The definitions in this section apply to Sec. Sec. 24.709 through 24.717,
unless otherwise specified in those sections.
(b) Small and very small business.
(1) A small business is an entity that, together with its affiliates and
persons or entities that hold interest in such entity and their affiliates,
has average annual gross revenues that are not more than $40 million for the
preceding three years.
(2) A very small business is an entity that, together with its affiliates
and persons or entities that hold interests in such entity and their
affiliates, has average annual gross revenues that are not more than $15
million for the preceding three years.
(c) Institutional Investor. An institutional investor is an insurance
company, a bank holding stock in trust accounts through its trust
department, or an investment company as defined in 15 U.S.C. 80a–3(a),
including within such definition any entity that would otherwise meet the
definition of investment company under 15 U.S.C. 80a–3(a) but is excluded by
the exemptions set forth in 15 U.S.C. 80a–3(b) and (c), without regard to
whether such entity is an issuer of securities; provided that, if such
investment company is owned, in whole or in part, by other entities, such
investment company, such other entities and the affiliates of such other
entities, taken as a whole, must be primarily engaged in the business of
investing, reinvesting or trading in securities or in distributing or
providing investment management services for securities.
(d) Nonattributable Equity. (1) Nonattributable equity shall mean:
(i) For corporations, voting stock or non-voting stock that includes no more
than twenty-five percent of the total voting equity, including the right to
vote such stock through a voting trust or other arrangement;
(ii) For partnerships, joint ventures and other non-corporate entities,
limited partnership interests and similar interests that do not afford the
power to exercise control of the entity.
(2) For purposes of assessing compliance with the equity limits in Sec. Sec. 24.709
(b)(1)(iii)(A) and (b)(1)(iv)(A), where such interests are not held directly
in the applicant, the total equity held by a person or entity shall be
determined by successive multiplication of the ownership percentages for
each link in the vertical ownership chain.
(e) Control Group. A control group is an entity, or a group of individuals
or entities, that possesses de jure control and de facto control of an
applicant or licensee, and as to which the applicant's or licensee's
charters, bylaws, agreements and any other relevant documents (and
amendments thereto) provide:
(1) That the entity and/or its members own unconditionally at least 50.1
percent of the total voting interests of a corporation;
(2) That the entity and/or its members receive at least 50.1 percent of the
annual distribution or any dividends paid on the voting stock of a
corporation;
(3) That, in the event of dissolution or liquidation of a corporation, the
entity and/or its members are entitled to receive 100 percent of the value
of each share of stock in its possession and a percentage of the retained
earnings of the concern that is equivalent to the amount of equity held in
the corporation; and
(4) That, for other types of businesses, the entity and/or its members have
the right to receive dividends, profits and regular and liquidating
distributions from the business in proportion to the amount of equity held
in the business.
Note to paragraph (e): Voting control does not always assure de facto
control, such as for example, when the voting stock of the control group is
widely dispersed (see e.g., Sec. 1.2110(c)(5)(ii)(C) of this chapter).
(f) Publicly Traded Corporation with Widely Dispersed Voting Power. A
publicly traded corporation with widely dispersed voting power is a business
entity organized under the laws of the United States:
(1) Whose shares, debt, or other ownership interests are traded on an
organized securities exchange within the United States;
(2) In which no person:
(i) Owns more than 15 percent of the equity; or
(ii) Possesses, directly or indirectly, through the ownership of voting
securities, by contract or otherwise, the power to control the election of
more than 15 percent of the members of the board of directors or other
governing body of such publicly traded corporation; and
(3) Over which no person other than the management and members of the board
of directors or other governing body of such publicly traded corporation, in
their capacities as such, has de facto control.
(4) The term person shall be defined as in section 13(d) of the Securities
and Exchange Act of 1934, as amended (15 U.S.C. 78(m)), and shall also
include investors that are commonly controlled under the indicia of control
set forth in the definition of affiliate in Sec. 1.2110(c)(5) of the
Commission's rules.
(g) Qualifying investor. (1) A qualifying investor is a person who is (or
holds an interest in) a member of the applicant's (or licensee's) control
group and whose gross revenues and total assets, when aggregated with those
of all other attributable investors and affiliates, do not exceed the gross
revenues and total assets limits specified in Sec. 24.709(a), or, in the case of
an applicant (or licensee) that is a small business, do not exceed the gross
revenues limit specified in paragraph (b) of this section.
(2) For purposes of assessing compliance with the minimum equity
requirements of Sec. 24.709(b)(1)(v) and (b)(1)(vi), where such equity interests
are not held directly in the applicant, interests held by qualifying
investors shall be determined by successive multiplication of the ownership
percentages for each link in the vertical ownership chain.
(3) For purposes of Sec. 24.709(b)(1)(v)(A)(3) and (b)(1)(vi)(A)(3), a
qualifying investor is a person who is (or holds an interest in) a member of
the applicant's (or licensee's) control group and whose gross revenues and
total assets do not exceed the gross revenues and total assets limits
specified in Sec. 24.709(a).
(h) Preexisting entity; Existing investor. A preexisting entity is an entity
that was operating and earning revenues for at least two years prior to
December 31, 1994. An existing investor is a person or entity that was an
owner of record of a preexisting entity's equity as of November 10, 1994,
and any person or entity acquiring de minimis equity holdings in a
preexisting entity after that date.
Note to paragraph (h): In applying the term existing investor to de minimis
interests in preexisting entities obtained or increased after November 10,
1994, the Commission will scrutinize any significant restructuring of the
preexisting entity that occurs after that date and will presume that any
change of equity that is five percent or less of the preexisting entity's
total equity is de minimis. The burden is on the applicant (or licensee) to
demonstrate that changes that exceed five percent are not significant.
[ 67 FR 45372 , July 9, 2002, as amended at 68 FR 42999 , July 21, 2003; 68 FR 57829 , Oct. 7, 2003]
Subpart I—Interim Application, Licensing, and Processing Rules for Broadband
PCS
Source: 59 FR 37610 , July 22, 1994, unless otherwise noted.
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