Beautifully engraved certificate from Pacific Gateway Exchange, Inc.
issued in 2001. This historic document was printed by the Security Columbian Banknote Company and has an ornate border around it with a vignette of a globe. This item has the printed signatures of the Company’s President and Chief Executive Officer, Howard A. Neckowitz and Executive Vice President and Secretary, Gail E. Granton and is over 10 years old.
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 18, 1996
Pacific Gateway is a facilities-based international telecommunications carrier which provides international telecommunications services primarily to its target customer base of long distance service providers worldwide, including five of the seven largest U.S.-based long distance carriers. The Company operates an international network consisting of international and domestic switching facilities in Los Angeles and New York, partial ownership interests in 14 digital undersea fiber optic cable systems in the Atlantic, Pacific and Caribbean regions and operating agreements that provide for the exchange of telecommunications traffic with foreign carriers.
As of March 31, 1996, Pacific Gateway had operating agreements with 25 foreign carriers in 19 countries around the world, which countries collectively represent approximately 43.3% of U.S.-originated international traffic. The Company is currently negotiating operating agreements with more than 20 prospective foreign partners. The Company's foreign partners include both telecommunications carriers that have been dominant in their home markets which may be wholly or partially government-owned (often referred to as Post Telephone and Telegraphs or "PTTs") and nondominant carriers that may have been recently established as a result of the deregulation of foreign telecommunications markets ("Competitive Carriers").
Industry sources estimate that the international telecommunications services market was approximately $50.6 billion in aggregate carrier revenues in 1994, with approximately $12.4 billion of this traffic originating in the United States, and that aggregate international telecommunications traffic grew at a compound annual rate of 13% during the period from 1990 to 1994, with some sectors in developing countries growing at faster rates. This historical growth rate is approximately twice the growth rate of aggregate U.S. domestic long distance traffic over the same period. The Company believes that the international telecommunications market will continue to experience strong growth for the foreseeable future.
The Company's senior management team founded Pacific Gateway in 1991 to capitalize on the significant growth opportunities it believes are being created by the following major trends in the international telecommunications services market: (i) global deregulation and privatization; (ii) increased availability of digital undersea fiber optic cable capacity; (iii) reductions in service costs driven by technological advancements and increased competition; and (iv) economic development and an increasing number of telephones and access lines in service worldwide. Despite the growth and general deregulatory trends in the global telecommunications market, however, the pace of change and emergence of competition in many countries remains slow, with domestic and international traffic still dominated by government-controlled monopoly carriers. The Company believes that U.S.-based international carriers, such as Pacific Gateway, which have already established, or are in negotiations to establish, operating agreements with government-controlled monopoly carriers in many such countries will be well-positioned to capture the benefits of increasing traffic flows as the telecommunications infrastructure in these countries is expanded.
The Company's strategy to capitalize on the growing demand for international telecommunications services consists of the following key elements: (i) secure additional operating agreements with foreign carriers, particularly in fast-growing markets in Asia, the Pacific Rim, Latin America and Eastern Europe; (ii) expand and enhance its global network facilities; (iii) pursue strategic alliances, joint ventures and acquisitions to increase both overseas-originated and U.S.-originated traffic; (iv) broaden its offering of higher margin value-added products and services; (v) leverage its existing network facilities through targeted direct marketing of international services to corporate customers located near the Company's switching facilities; and (vi) maintain efficient, low-cost operations.
International long distance traffic is traditionally exchanged pursuant to bilateral operating agreements entered into between international long distance carriers in two countries. The Company believes that it is currently the only U.S.-based international carrier other than AT&T Communications, Inc., MCI Telecommunications Corporation, Sprint Corporation and WorldCom, Inc. to have secured a significant number of traditional switched voice bilateral operating agreements with foreign carriers. Unless a U.S.-based international carrier is able to offer a new business opportunity or a new source of traffic, generally there is little incentive for a foreign carrier to take on the administrative burdens of negotiating a new operating agreement with a U.S.-based carrier, to incur additional capital investment, and to maintain the relationship on an ongoing basis. The Company believes that the combination of the large traffic volume, proven operating performance and personal relationships that traditionally has been required both to establish operating agreements and to secure positions in digital undersea fiber optic cable systems creates a significant barrier to entry in the international telecommunications services market.
The Company's target customer base includes the more than 200 U.S.-based long distance carriers with annual revenues of between $50 million and $2 billion and the foreign carriers with which the Company has, or proposes to have, operating agreements. As of March 31, 1996, Pacific Gateway provided its services to approximately 57 U.S.-based long distance carriers and 25 foreign carriers. The Company has been able to increase its revenues by providing service to new U.S.-based customers, by providing its existing customers with direct service to additional countries as it obtains new operating agreements and by terminating increasing volumes of traffic from its foreign carrier partners. The Company believes that the principal reasons its customers select Pacific Gateway to carry their international traffic are (i) the Company's reputation for operating a state-of-the-art network at rates that are comparable to or lower than its competitors; (ii) that the Company's size enables its experienced sales and operating personnel to tailor cost-effective telecommunications services to meet customers' needs and to provide highly responsive, flexible customer service; and (iii) that Pacific Gateway is the only significant U.S. facilities-based international carrier that does not also compete primarily for end-user customers in the domestic long distance market.
The Company was incorporated in Delaware on August 8, 1991. The Company's principal executive offices are located at 533 Airport Boulevard, Suite 505, Burlingame, California 94010. Its telephone number is (415) 375-6700.
History from StockResearch.pro
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