4. The Proposed Transaction

In this application, Applicants request Commission approval of the transfer of control of Yak America to Blackbird, through Blackbird's acquisition of 100% of the issued and outstanding shares of capital stock of Yak America, on a nunc pro tunc basis. According to the application, the sale of Yak America to Blackbird closed on January 16, 2007. The application states that the FCC has already approved this transaction.

Applicants claim that they needed to quickly complete the transfer of Yak America to Blackbird before obtaining Commission approval in order to fill "management voids" following the sale of Yak America to Yaktastic. Applicants state that Yak America needed capable management, at both the senior management and the operation levels. According to the application, Yaktastic found it more difficult to operate Yak America's switching and billing functions than originally anticipated and began to question the continued availability of "casual calling" over the Yak America network. Yaktastic also became concerned that the financial performance of Yak America could not be sustained.

However, some of the former principals who had originally sold Yak America to Yaktastic developed a renewed interest in Yak America. One of them, Jose Cadi, who had retained a non-financial interest in Yak America, recently formed Blackbird and acquired Yak America from Yaktastic in order to serve the U.S. market. Since Mr. Cadi has engaged other former managers of Yak Communications as consultants in this matter, he has effectively restored the prior management of Yak America to the leadership of the company.

According to the application, after the transfer of Yak America to Blackbird, Yak America has continued to offer its customers the same services at the same rates, terms, and conditions pursuant to existing authorizations, tariffs, contracts, and published rates and charges. The only change is that Yak America is now owned by Blackbird, rather than Yaktastic. The application states that no customers were disconnected as a result of the transfer, and that the transfer was necessary to ensure the continued availability of service to customers. Yak America will now have access to the financial resources of Blackbird for its operations.