III. Financial Qualifications

To be granted a CPCN, an applicant for authority to provide facilities-based and resold local exchange telecommunications services must demonstrate that it has a minimum of $100,000 of cash or cash equivalent to meet the firm's start-up expenses.¹ An applicant must also demonstrate that it has sufficient additional resources to cover all deposits required by local exchange carriers (LECs) and/or interexchange carriers (IECs) in order to provide the proposed service.² Applicant is a third-tier subsidiary of China Motion Telecom International Limited (China Motion), a Bermuda company that is publicly traded on the Hong Kong and Singapore stock exchanges. Applicant has provided a copy of China Motion's most recent audited financial statements and an unconditional guarantee by China Motion of Applicant's operating expenses that together demonstrate it has sufficient financial resources to provide local exchange services in California.

¹ The financial requirement for CLCs is contained in D.95-12-056, Appendix C. ² The requirement for CLC applicants to demonstrate that they have additional financial resources to meet any deposits required by underlying LECs and/or IECs is set forth in D.95-12-056, Appendix C.