9. Request for Confidentiality
Applicants request that financial information pertaining to ABRY' income statement and balance sheet, Exhibits E and F filed with this application be kept under seal. Applicants represent that the information is proprietary and sensitive. The information, if revealed, would place Applicants at an unfair business disadvantage. We have granted similar requests in the past and will do so here.
1. Notice of this application appeared in the Commission's Daily Calendar of March 19, 2002.
2. No protests have been filed.
3. Applicants seek authorization pursuant to Pub. Util. Code § 854(a) for ABRY Partners, LLC for the indirect control of Evans by its investment in Country Road.
4. Evans Telephone is a local exchange telephone utility owned by Country Road serving approximately 12,000 access lines in portions of Merced, Stanislaus, Santa Clara, and Yolo Counties.
5. ABRY's investment in Country Road will occur through two affiliated investment funds, ABRY Partners IV, L.P. and ABRY Investment Partnership, L.P., both Delaware limited partnerships.
6. ABRY will become the new owner of Evans through the indirect control of Country Road.
7. ABRY's ownership will provide an infusion of capital into the Evans Telephone operations.
8. Evans Telephone's parent, Country Road is a Delaware corporation that owns and operates two small local exchange companies in Maine and West Virginia.
9. Evans Telephone must continue to report all significant transactions with unregulated affiliates according to Section 587 and the rules set forth in D.93-02-019.
10. On December 17, 2001, Evans filed for a general rate increase of $160,843 by Advice Letter No. 326.
11. Public disclosure of financial information pertaining to ABRY's income statement and balance sheet, included in this application, would place ABRY at an unfair business disadvantage.
1. The proposed indirect transfer of control of Evans Telephone and its parent, Country Road, to ABRY Partners, LLC is in the public interest as long as Evans Telephone ratepayers are insulated from any debt repayment obligations of Country Road and Evans Holdings, and insulated from the success or failure of Country Road's CLC operation, CRC.
2. The transaction will benefit the public interest if Applicants continue to invest approximately $11 million in network infrastructure through June 2006 and continue to increase the offering of broadband and other services to Evans Telephone customers without increasing local rates.
3. To ensure the proposed transaction is in the public interest, the Commission should approve this application subject to the conditions set forth in Appendix A of this order.
4. The proposed transaction does not have the potential for causing a significant effect upon the environment. Applicants must follow all applicable environmental regulations and Commission rules for construction of any facilities.
5. Applicants' (ABRY's) request to file their financial information under seal should be granted for two years.
6. This proceeding is designated a ratesetting proceeding; no protests have been received; no hearing is necessary.
IT IS ORDERED that:
1. Application (A.) 02-03-015 is approved subject to the conditions set forth in Appendix A of this order.
2. Evans Telephone Company and ABRY Partners, LLC are not granted any authorization by this order to construct facilities and shall follow all applicable environmental regulations and Commission rules should they wish to construct facilities.
3. Applicants' request that the financial information pertaining to ABRY Partners, LLC's income statement and balance sheet, filed with this application be kept under seal is granted for two years from the effective date of this decision. During that period, the information shall not be made accessible or disclosed to anyone other than the Commission staff except on the further order of the Commission, the Assigned Commissioner, the assigned Administrative Law Judge (ALJ), or the ALJ then designated as Law and Motion Judge.
4. If Applicants believe that further protection of the information kept under seal is needed, they may file a motion stating the justification for further withholding of the information from public inspection, or for such other relief as the Commission rules may then provide. This motion shall be filed no later than one month before the expiration date.
5. A.02-03-015 is closed.
This order is effective today.
Dated June 27, 2002, at San Francisco, California.
LORETTA M. LYNCH
President
HENRY M. DUQUE
CARL W. WOOD
GEOFFREY F. BROWN
MICHAEL R. PEEVEY
Commissioners
APPENDIX A
ADOPTED CONDITIONS
The authority granted by this decision is contingent upon the following conditions:
1. Evans Telephone shall not sell any assets used or useful in the provision of its regulated services to satisfy debt obligations incurred by Country Road or Evans Holdings to finance the acquisition of the Evans Telephone or Evans Communications.
2. Evans Telephone shall not increase rates for its customers due to any increase in costs brought about by its acquisition by Country Road and Evans Holdings or by ABRY's indirect control of Country Road.
3. Evans Telephone shall manage its finances on a stand-alone basis, independent of ABRY, Country Road, CRC Communications of California, and other affiliates.
4. ABRY, Country Road and Evans Holdings shall provide Evans Telephone with sufficient equity capital to maintain a reasonable and balanced capital structure and to provide service to the public that is safe, reliable, and in compliance with all applicable statutes and Commission orders.
5. Evans Telephone shall comply with all existing and future affiliate rules and reporting requirements.
6. Evans Telephone shall not pay a dividend, loan money, or provide any other forms of capital to ABRY, Country Road, Evans Holdings, or other affiliates if doing so would jeopardize the utility's ability to provide reliable service at reasonable rates.
7. Country Road shall continue to invest at least $11 million in network infrastructure for Evans Telephone over through June 2006 and continue to increase the offering of broadband and other services to Evans Telephone customers, over current levels, without increasing local rates.
(END OF APPENDIX A)
