SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                 --------------

                                    FORM 10-K

                  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                                 --------------
(Mark One)
    |X|     Annual Report pursuant to Section 13 or 15(d) of the Securities
            Exchange Act of 1934 [Fee Required]

            For the fiscal year ended December 31, 1998 or

    |_|     Transition report pursuant to Section 13 or 15(d) of the Securities
            Exchange Act of 1934 [No Fee Required]

            For the transition period from               to               

                        Commission file number 333-36253

                                 --------------

                       PRICE COMMUNICATIONS WIRELESS, INC.
             (Exact name of registrant as specified in its charter)

              Delaware                                         13-3956941
   (State or other jurisdiction of                           (IRS Employer
    Incorporation or organization)                        Identification Number)

45 Rockefeller Plaza, New York, New York                          10020
(Address of principal executive offices)                        (Zip Code)

        Registrant's telephone number, including area code (212) 757-5600

    Securities registered pursuant to Section 12(b) or Section 12(g) of the
                                   Act: None

      Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports); and (2) has been subject to the
filing requirements for the past 90 days. Yes |X| No |_|

      Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K (229.405 of this chapter) is not contained herein, and
will not be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to the Form 10-K. |X|

                   AGGREGATE MARKET VALUE OF THE VOTING STOCK
                      HELD BY NONAFFILIATES OF THE COMPANY

      No shares of the Company's Common Stock were held by nonaffiliates of the
Company on February 28, 1999.

      The number of shares outstanding of the Company's Common Stock as of
February 28, 1999 was 100.

                             DOCUMENTS INCORPORATED
                                  BY REFERENCE

      None

                       OMISSION OF CERTAIN INFORMATION BY
                        CERTAIN WHOLLY-OWNED SUBSIDIARIES

      The registrant meets the conditions set forth in General Instruction I
1(a) and (b) of Form 10-K and is therefore filing this form with a reduced
disclosure format.
================================================================================
<PAGE>

                                     PART I

Item 1. BUSINESS

General

      Unless otherwise indicated, all references herein to "PCW" refer to Price
Communications Wireless, Inc. and all references herein to the "Company" refer
to PCW and its subsidiaries and their respective predecessors. References herein
to the "Acquisition" refer to the acquisition during 1997 by PCW, which is a
wholly-owned direct subsidiary of Price Communications Cellular Holdings, Inc.
("Holdings") and a wholly-owned indirect subsidiary of Price Communications
Corporation ("PCC"), of Palmer Wireless, Inc. ("Palmer") and the related sales
of the Fort Myers and Georgia-1 systems of Palmer, as described below under "The
Acquisition." As used herein, the term "Palmer" includes its subsidiaries and
predecessors. PCW's principal executive offices are located at 45 Rockefeller
Plaza, New York, New York 10020, and its telephone number is (212) 757-5600.
Except for historical financial information and unless otherwise indicated, all
information presented below relating to the Company, including Pops, Net Pops
and the systems, gives effect to the consummation of the Acquisition (including
the sales of the Fort Myers and Georgia- 1 systems). See "Certain Terms" for
definitions of certain terms used herein.

      The Company is engaged in the construction, development, management and
operation of cellular telephone systems in the southeastern United States. At
December 31, 1998, the Company provided cellular telephone service to 381,977
subscribers in Georgia, Alabama, South Carolina and Florida in a total of 16
licensed service areas composed of eight Metropolitan Statistical Areas ("MSAs")
and eight Rural Service Areas ("RSAs"), with an aggregate estimated population
of 3.3 million. The Company sells its cellular telephone service as well as a
full line of cellular products and accessories principally through its network
of retail stores. The Company markets all of its products and services under the
nationally recognized service mark CELLULAR ONE.

      The Company has developed its business through the acquisition and
integration of cellular telephone systems, clustering multiple systems in order
to provide broad areas of uninterrupted service and achieve certain economies of
scale, including centralized marketing and administrative functions as well as
multi-system capital expenditures. The Company devotes considerable attention to
engineering, maintenance and improvement of its cellular telephone systems in an
effort to deliver high-quality service to its subscribers and to implement new
technologies as soon as economically practicable. Through its participation in
the North American Cellular Network ("NACN"), the Company is able to offer
ten-digit dialing access to its subscribers when they travel outside the
Company's service areas, providing them with convenient roaming access
throughout large areas of the United States, Canada, Mexico and Puerto Rico
served by other NACN participants. By marketing its products and services under
the CELLULAR ONE name, the Company also enjoys the benefits of association with
a nationally recognized service mark.
<PAGE>

Markets and Systems

      The Company's cellular telephone systems serve contiguous licensed service
areas in Georgia, Alabama and South Carolina. The Company also has a cellular
service area in Panama City, Florida. The following table sets forth as of
December 31, 1998 and 1997 with respect to each service area in which the
Company owns a cellular telephone system, the estimated population, the
Company's beneficial ownership percentage and the Net Pops owned by the Company.

                                   Estimated
Service Area                     Population(1)    Percentage         Net Pops
------------                     -------------    ----------        ---------

Albany, GA ..................        117,984          86.5%           102,056
Augusta, GA .................        440,864         100.0            440,864
Columbus, GA ................        250,845          85.2            213,720
Macon, GA ...................        318,227          99.2            315,681
Savannah, GA ................        288,736          98.5            284,405
Georgia-6 RSA ...............        203,899          96.3            196,355
Georgia-7 RSA ...............        135,121         100.0            135,121
Georgia-8 RSA ...............        157,912         100.0            157,912
Georgia-9 RSA ...............        118,111         100.0            118,111
Georgia-10 RSA ..............        151,827         100.0            151,827
Georgia-12 RSA ..............        215,935         100.0            215,935
Georgia-13 RSA ..............        148,361          86.5            128,332
Dothan, AL ..................        133,618          94.6            126,403
Montgomery, AL ..............        320,687          92.8            297,598
Alabama-8, RSA ..............        173,677         100.0            173,677
                                   ---------         -----          ---------
     Subtotal ...............      3,175,804                        3,057,997
                                   ---------                        ---------
Panama City, FL .............        149,953          78.4            117,563
                                   ---------                        ---------
     Total ..................      3,325,757                        3,175,560
                                   =========                        =========

(1)   Based on population estimates for 1998 from the DLJ 1998 Winter Book.

Georgia/Alabama

      In 1988, the Company acquired controlling interests in the licenses to
operate cellular telephone systems in the four MSAs (Montgomery and Dothan,
Alabama and Columbus and Albany, Georgia) that make up the core of its
Georgia/Alabama cluster. The Company continued to increase its presence in this
market by acquiring additional cellular service areas in 1989 (Macon, Georgia
MSA), 1992 (Georgia-9 RSA), 1993 (Alabama-8 RSA), 1994 (Georgia-7 RSA, Georgia-
8 RSA, Georgia-10 RSA and Georgia-12 RSA), 1995 (Savannah, Georgia MSA and
Augusta, Georgia MSA) and 1996 (Georgia-1 RSA and Georgia-6 RSA). The Augusta,
Georgia MSA includes Aiken County in South Carolina. In the aggregate, these
markets now cover a contiguous service area of approximately 38,000 square miles
that includes Montgomery, the state capital of Alabama, prominent resort
destinations in Jekyll Island, St. Simons Island and Sea Island, Georgia, and
over 710 miles of interstate highway, including most of 1-95 from Savannah,
Georgia to Jacksonville, Florida. The Company collects substantial roaming
revenue from cellular telephone subscribers from other systems traveling in
these markets from nearby population centers such as Atlanta and Birmingham, as
well as from vacation and business traffic in the southeastern United States.
Due in part to the favorable labor environment, moderate weather and relatively
low cost of land, during the last several years there has been an influx of new
manufacturing plants in this market. As of December 31, 1998 the Company
utilized 223 cell sites in this cluster.

Panama City

      The Company acquired control of the non-wireline cellular license for the
Panama City, Florida market in 1991. The Company collects substantial roaming
revenue in this market from subscribers from other systems who visit Panama
City, a popular spring and summer vacation destination. As of December 31, 1998,
the Company utilized 13 cell sites in this market.


                                       2
<PAGE>

Company Strategy

      The Company's four strategic objectives are to: (1) expand its revenue
base by increasing penetration in existing service areas and encouraging greater
usage among its existing customers; (2) provide high-quality customer service to
create and maintain customer loyalty; (3) enhance performance by aggressively
pursuing opportunities to increase operating efficiencies and (4) expand its
regional wireless communications presence by selectively acquiring additional
interests in cellular telephone systems (including minority interests).
Specifically, the Company strives to achieve these objectives through
implementation of the following:

      Aggressive, Direct Marketing. The Company employs a two-tier direct sales
force. A retail sales force handles walk-in traffic at the Company's 37 retail
outlets, and a targeted sales staff solicits certain industries and government
subscribers. The Company's management believes that its internal sales force is
more likely than independent agents to successfully select and screen new
subscribers and select pricing plans that realistically match subscriber means
and needs.

      Flexible, Value-Oriented Pricing Plans. The Company provides a range of
pricing plans, each of which includes a monthly access fee and a bundle of
"free" minutes. Additional home rate minutes are charged at rates dependent on
the customer's usage plan and the time of day. In addition, the Company offers
wide area home rate roaming in the Company's systems and low flat rate roaming
in a six state region in the Southeastern United States.

      The Company believes that its bundled minute offerings will encourage
greater customer usage. By increasing the number of minutes a customer can use
for one flat rate, subscribers perceive greater value in their cellular service
and become less usage sensitive, i.e., they can increase their cellular phone
usage without seeing large corresponding increases in their cellular bill.

      Continually Adopting State of the Art System Design. The Company's network
allows the delivery of full personal communication services ("PCS")
functionality to its digital cellular customers, including primarily caller ID,
short message paging and extended battery life. The Company's network provides
for "seamless handoff" between digital cellular and PCS operators that, like the
Company, employ TDMA (Time Division Multiple Access) technology, one of three
industry standards and the one employed by AT&T, SBC and others; i.e. the
Company's customers may leave the Company's service area and enter an area
serviced by a PCS provider using TDMA technology without noticing the
difference, and vice versa. The Company has a favorable agreement with AT&T with
respect to PCS roaming and expects that other PCS operators may choose, like
AT&T, to concentrate PCS buildout in urban centers rather than the more rural
areas in which the Company concentrates.

      Focusing on Customer Service. Customer service is an essential element of
the Company's marketing and operating philosophy. The Company is committed to
attracting new subscribers and retaining existing subscribers by providing
consistently high-quality customer service. In each of its cellular service
areas, the Company maintains a local staff, including a market manager, customer
service representatives, technical and engineering staff, sales representatives
and installation and repair facilities. Each cellular service area handles its
own customer-related functions such as credit evaluations, customer evaluations,
account adjustments and rate plan changes. To ensure high-quality service,
Cellular One Group authorizes a third-party marketing research firm to perform
customer satisfaction surveys of each of its licensees. Licensees must achieve a
minimum satisfaction level in order to continue using the Cellular One service
mark. The Company has repeatedly ranked number one in customer satisfaction
among all Cellular One operators (#l MSA in its category in 1998, 1997, 1996,
1995, 1993, and 1992; #1 RSA in its category in 1995).

The Acquisition

      Prior to the Merger described below, the Company did not have any assets,
liabilities or operations other than the proceeds from the issuance of the 11
3/4% PCW Notes (as such term is described below) and liabilities with respect
thereto.

      On May 23, 1997, PCC, PCW and Palmer entered into an Agreement and Plan of
Merger (the "Merger Agreement"). The Merger Agreement provided, among other
things, for the merger of PCW with and into Palmer with Palmer as the surviving
corporation (the "Merger"). On October 6, 1997, the Merger was consummated and
Palmer changed its name to "Price Communications Wireless, Inc." Pursuant to the
Merger Agreement, PCC acquired each issued and outstanding share of common stock
of Palmer for a purchase price of $17.50 per share in cash and purchased
outstanding options and rights under employee and direct stock purchase plans
for an aggregate price of $486.4 million. In addition, as a result of the
Merger, the Company assumed all outstanding indebtedness of Palmer of
approximately $378.0 million ("Palmer Existing Indebtedness"), making the
aggregate purchase price for Palmer (including transaction fees and expenses)
approximately $880.0 million. The Company refinanced all of the Palmer Existing
Indebtedness concurrently with the consummation of the Merger.


                                       3
<PAGE>

      PCW entered into an agreement (the "Fort Myers Sale Agreement") to sell
Palmer's Fort Myers, Florida MSA covering approximately 382,000 Pops for $168.0
million (the "Fort Myers Sale"). On October 6, 1997, the Fort Myers Sale was
consummated, and generated proceeds to the Company of approximately $166.0
million. The proceeds of the Fort Myers Sale were used to fund a portion of the
acquisition of Palmer.

      On October 21, 1997, PCC and PCW entered into an Asset Purchase Agreement
with MJ Cellular Company, L.L.C. (the "Georgia Sale Agreement") which provided
for the sale by PCW, for $25.0 million, of substantially all of the assets of
the non-wireline cellular telephone system serving the Georgia-1-Whitfield Rural
Service Area ("Georgia-1"), including the FCC licenses to operate Georgia-1 (the
"Georgia Sale"). The sale of the assets of Georgia-1 was consummated on December
30, 1997 and generated proceeds to the Company of $24.2 million. A portion of
the proceeds from the Georgia Sale was used to retire a portion of the debt used
to fund the acquisition of Palmer. The Merger, the Fort Myers Sale and the
Georgia-1 Sale are collectively referred to as the "Acquisition."

      In order to fund the Acquisition and pay related fees and expenses, PCW
issued $175.0 million aggregate principal amount of 11 3/4% Senior Subordinated
Notes due 2007 (the "11 3/4% Notes") and entered into a syndicated senior loan
facility providing for term loan borrowings in the aggregate principal amount of
$325.0 million and revolving loan borrowings of $200.0 million (the "Credit
Facility"). On October 6, 1997, PCW borrowed all term loans available thereunder
and approximately $120.0 million of revolving loans

      The Acquisition was also funded in part through a $44.0 million equity
contribution from PCC (the "PCC Equity Contribution") which was in the form of
cash and common stock of PCC. An additional amount of the purchase price for the
Acquisition was raised out of the proceeds from the issuance and sale for $80.0
million (the "Holdings Offering") by Holdings, the direct parent of the Company,
of units consisting of $153.4 million principal amount of 13 1/2% Senior Secured
Discount Notes due 2007 of Holdings (the "13 1/2% Holdings Notes") and warrants
(the "Warrants") to purchase shares of PCC Common Stock, par value $.01 per
share (the "PCC Shares").

Refinancing

      In June 1998, the Company issued $525.0 million of 9 1/8% Senior Secured
Notes (the "9 1/8% Notes") due December 15, 2006 with interest payable
semi-annually commencing December 15, 1998. The 9 1/8% Notes contain covenants
that restrict the payment of dividends, incurrence of debt and sale of assets.
The proceeds of these notes were used principally to replace the then existing
credit facility, which approximated $425.1 million as of the redemption date.

      In August 1998, Holdings redeemed all of its outstanding 13 1/2% Holdings
Notes. The notes were redeemed at the redemption price per $1000 aggregate
principal amount of $711.61. The accreted value of the notes approximated $91.0
million. In addition, a premium of 20% of the outstanding indebtedness or
approximately $18.2 million was also paid. The redemption was financed out of
the net proceeds of a new $200.0 million Holdings offering of 11 1/4% Senior
Exchangeable Payable-in-Kind notes due 2008.

Certain Considerations

      Competition. Although current policies of the FCC authorize only two
licensees to operate cellular telephone systems in each cellular market, there
is, and the Company expects there will continue to be, competition from various
wireless technology licensees authorized to serve each market in which the
Company operates, as well as from resellers of cellular service. Competition for
subscribers between the two cellular licensees in each market is based
principally upon the services and enhancements offered, the technical quality of
the cellular telephone system, customer service, system coverage and capacity
and price. The Company competes with a wireline licensee in each of its cellular
markets, some of which are larger and have access to more substantial capital
resources than the Company.

      The Company also faces competition from other existing communications
technologies such as conventional mobile telephone service, specialized mobile
radio ("SMR") and enhanced specialized mobile radio ("ESMR") systems and paging
services and to a limited extent, satellite systems for mobile communications.
The Company also faces limited competition from and may in the future face
increased competition from PCS. Broadband PCS involves a network of small,
low-powered transceivers placed throughout a neighborhood, business complex,
community or metropolitan area to provide customers with mobile and portable
voice and data communications. PCS may be capable of offering, and PCS operators
claim they will offer, additional services not offered by cellular providers.
There can be no assurances that the Company will be able to provide nor that it
will choose to pursue, depending on the economics thereof, such services and
features. The FCC has also completed or 


                                       4
<PAGE>

announced plans for auctions in wireless services such as narrowband PCS, local
multipoint multichannel distribution service ("LMDS"), interactive video
distribution service ("IVDS"), wireless communication service ("WCS") and
general wireless communications service ("GWCS") spectrum. Some of this spectrum
might be used for services competitive in some manner with cellular service. The
Company cannot predict the effect of these proceedings and auctions on the
Company's business. However the Company currently believes that traditional
tested cellular is economically proven unlike many of these other technologies
and therefore does not intend to pursue such other technologies.

      Although the Company believes that the technology, financing and
engineering of these other technologies is not as advanced as their publicity
would suggest, there can be no assurance that one or more of the technologies
currently utilized by the Company in its business will not become obsolete at
some time in the future. See "Business of the Company--Competition."

      Potential for Regulatory Changes and Need for Regulatory Approvals. The
FCC regulates the licensing, construction, operation, acquisition, assignment
and transfer of cellular telephone systems, as well as the number of licensees
permitted in each market. Changes in the regulation of cellular activities could
have a material adverse effect on the Company's operations. In addition, all
cellular licenses in the United States are granted for an initial term of up to
10 years and are subject to renewal. The Company's cellular licenses expire in
the following years with respect to the following number of service areas: 2000
(two); 2001 (four); 2002 (two); 2006 (one); 2007 (four) and 2008 (three). While
the Company believes that each of these licenses will be renewed based upon FCC
rules establishing a renewal expectancy in favor of licensees that have complied
with their regulatory obligations during the relevant license period, there can
be no assurance that all of the Company's licenses will be renewed in due
course. In the event that a license is not renewed, the Company would no longer
have the right to operate in the relevant service area. The non-renewal of
licenses could have a material adverse effect on the Company's results of
operations. See "Business of the Company--Regulation."

      Fluctuations in Market Value of License. A substantial portion of the
Company's assets consists of its interests in cellular licenses. The assignment
of interests in such licenses is subject to prior FCC approval and may also be
subject to contractual restrictions, future competition and the relative supply
and demand for radio spectrum. The future value of the Company's interests in
its cellular licenses will depend significantly upon the success of the
Company's business. While there is a current market for the Company's licenses,
such market may not exist in the future or the values obtainable may be
significantly lower than at present. As a consequence, in the event of the
liquidation or sale of the Company's assets, there can be no assurance that the
proceeds would be sufficient to pay the Company's obligations, and a significant
reduction in the value of the licenses could require a charge to the Company's
results of operations.

      Reliance on Use of Third Party Service Mark. The Company currently uses
the registered service mark CELLULARONE to market its services. The Company's
use of this is and has historically been, governed by five-year contracts
between the Company and Cellular One Group, the owner of the service mark, for
each of the markets in which the Company operates. See "Description of
Cellular One Agreements." Such contracts currently in effect are expiring at
different times through December 1, 2001. If for some reason beyond the
Company's control, the name CELLULARONE were to suffer diminished marketing
appeal, the Company's ability both to attract new subscribers and retain
existing subscribers could be materially affected. AT&T Wireless Services, Inc.,
which has been the single largest user of the CELLULARONE service mark, has
significantly reduced its use of the service mark as a primary service mark, as
has Centennial Cellular. There can be no assurance that such reduction in use by
any of such parties will not have an adverse effect on the marketing appeal of
the brand name.

      Dependence on Key Personnel. The Company's affairs are managed by a small
number of key management and operating personnel, the loss of whom could have an
adverse impact on the Company. The success of the Company's operations and
expansion strategy depends on its ability to retain and to expand its staff of
qualified personnel in the future.

      Radio Frequency Emission Concerns. Media reports have suggested that
certain radio frequency ("RF") emissions from portable cellular telephones may
be linked to certain types of cancer. In addition, recently a limited number of
lawsuits have been brought, not involving the Company, alleging a connection
between cellular telephone use and certain types of cancer. Concerns over RF
emissions and interference may have the effect of discouraging the use of
cellular telephones, which could have an adverse effect upon the Company's
business. As required by the Telecom Act, in August 1996, the FCC adopted new
guidelines and methods for evaluating RF emissions from radio equipment,
including cellular telephones. While the new guidelines impose more restrictive
standards on RF emissions from low power devices such as portable cellular
telephones, the Company believes that all cellular telephones currently marketed
and in use comply with the new standards.

      The Company carries $2.0 million in General Liability insurance and $25.0
million in umbrella liability coverage. This insurance would cover (subject to
coverage limits) any liability suits with respect to human exposure to radio
frequency emissions.


                                       5
<PAGE>

      Equipment Failure, Natural Disaster. Although the Company carries
"business interruption" insurance, a major equipment failure or a natural
disaster affecting any one of the Company's central switching offices or certain
of its cell sites could have a significant adverse effect on the Company's
operations.

Operations

      General

      The Company is currently engaged in the construction, development,
management and operation of cellular telephone systems in the southeastern
United States. At December 31, 1998, the Company provided cellular telephone
service to 381,977 subscribers in Georgia, Alabama, Florida and South Carolina
in a total of 16 licensed service areas composed of eight MSAs and eight RSAs,
with an aggregate estimated population of 3.3 million. The Company sells its
cellular telephone service as well as a full line of cellular products and
accessories, including pagers, principally through its network of retail stores.
The Company markets all of its products and services under the nationally
recognized service mark CELLULARONE.

      The following table sets forth information, at the dates indicated after
giving effect to the Acquisition, regarding the Company's subscribers,
penetration rate, cost to add a net subscriber, average monthly churn rate and
average monthly service revenue per subscriber.

<TABLE>
<CAPTION>
                                                      Year Ended December 31,
                                                      -----------------------
                                        1998        1997        1996        1995        1994
                                        ----        ----        ----        ----        ----
<S>                                    <C>        <C>         <C>         <C>          <C>   
Subscribers at end of period(1) ....   381,977     309,606     243,204     187,870      99,626
Penetration at end of period(2) ....     11.57%       9.40%       7.73%       6.41%       4.54%
Cost to add a net subscriber(3) ....  $    448    $    461    $    436    $    275    $    247
Average monthly churn(4) ...........      1.91%       1.88%       1.89%       1.51%       1.54%
Average monthly service revenue per
   Subscriber(5) ...................  $  51.67    $  52.06    $  52.20    $  56.68    $  60.02
</TABLE>

(1)   Each billable telephone number in service represents one subscriber.

(2)   Determined by dividing the aggregate number of subscribers by the
      estimated population.

(3)   Determined for the periods, by dividing (i) all costs of sales and
      marketing, including salaries, commissions and employee benefits and all
      expenses incurred by sales and marketing personnel, agent commissions,
      credit reference expenses, losses on cellular telephone sales, rental
      expenses allocated to retail operations, net installation expenses and
      other miscellaneous sales and marketing charges for such period by (ii)
      the net subscribers added during such period.

(4)   Determined for the periods by dividing total subscribers discontinuing
      service by the average number of subscribers for such period, and divided
      by the number of months in the relevant period.

(5)   Determined for the periods by dividing the (i) sum of the access, airtime,
      roaming, long distance, features, connection, disconnection and other
      revenues for such period by (ii) the average number of subscribers for
      such period, divided by the number of months in the relevant period.

Subscribers and System Usage

      The Company's subscribers have increased to 381,977 at December 31, 1998.
Reductions in the cost of cellular telephone services and equipment at the
retail level have led to an increase in cellular telephone usage by general
consumers for non-business purposes. As a result, the Company believes that
there is an opportunity for significant growth in each of its existing service
areas. The Company will continue to broaden its subscriber base for basic
cellular telephone services as well as increase its offering of customized
services. The sale of custom calling features typically results in increased
usage of cellular telephones by subscribers thereby further enhancing revenues.
In 1998, cellular telephone service revenues represented 93.6% of the Company's
total revenues, with equipment sales and installation representing the balance.

Marketing

      The Company's marketing strategy is designed to generate continued net
subscriber growth by focusing on subscribers who are likely to generate lower
than average deactivations and delinquent accounts, while simultaneously
maintaining a low cost of adding net subscribers. Management has implemented its
marketing strategy by training and compensating its sales force in a manner
designed to stress the importance of high penetration levels and minimum costs
per net subscriber addition. The 


                                       6
<PAGE>

Company's sales staff has a two-tier structure. A retail sales force handles
walk-in traffic, and a targeted sales staff solicits certain industries and
government subscribers.

      The Company believes its use of an internal sales force keeps marketing
costs low, both because commissions are lower and because subscriber retention
is higher than if it used independent agents. The Company believes its cost to
add a net subscriber will continue to be among the lowest in the cellular
telephone industry, principally because of its in-house direct sales and
marketing staff.

      The Company's sales force works principally out of retail stores in which
the Company offers its cellular products and services. As of December 31, 1998,
the Company maintained 37 retail stores and 3 offices. Retail stores, which
range in size up to 11,000 square feet, are fully equipped to handle customer
service and the sale of cellular services, telephones and accessories. Eight of
the newer and larger stores are promoted by the Company as "Superstores," seven
of which are located in the Company's Georgia/Alabama service areas, and one in
the Panama City, Florida service area. Each Superstore has an authorized
warranty repair center and provides cellular telephone installation and
maintenance services. Most of the Company's larger markets currently have at
least one Superstore. In addition, to enhance convenience for its customers, the
Company has begun to open smaller stores in locations such as shopping malls.
The Company's stores provide subscriber-friendly retail environments, extended
hours, a large selection of phones and accessories, an expert sales staff, and
convenient locations-which make the sales process quick and easy for the
subscriber.

      The Company markets all of its products and services under the name
CELLULARONE. The national advertising campaign conducted by Cellular One Group
enhances the Company's advertising exposure at a fraction of what could be
achieved by the Company alone. The Company also obtains substantial marketing
benefits from the name recognition associated with this widely used service
mark, both with existing subscribers traveling outside the Company's service
areas and with potential new subscribers moving into the Company's service
areas. In addition, travelers who subscribe to CELLULARONE service in other
markets may be more likely to use the Company's service when they travel in the
Company's service areas. Cellular telephones of non-wireline subscribers are
either programmed to select the non-wireline carrier (such as the Company) when
roaming, unless the non-wireline carrier in the roaming area is not yet
operational, or the subscriber dials a special code or has a cellular telephone
equipped with an "A/B" (wireline/non-wireline) switch and selects the wireline
carrier.

      Through its membership in NACN and other special networking arrangements,
the Company provides extended regional and national service to its subscribers,
thereby allowing them to make and receive calls while in other cellular service
areas without dialing special access codes. This service distinguishes the
Company's call delivery features from those of many of its competitors.

Products and Services

      In addition to providing high-quality cellular telephone service in each
of its markets, the Company also offers various custom-calling features such as
voicemail, call forwarding, call waiting, three-way conference calling and no
answer and busy transfer. Several rate plans are presented to prospective
subscribers so that they may choose the plan that will best fit their expected
calling needs. Generally, these rate plans include a high user plan, a medium
user plan, a basic plan and an economy plan. Most rate plans combine a fixed
monthly access fee, per minute usage charges and additional charges for
custom-calling features in a package that offers value to the subscriber while
enhancing airtime use and revenues for the Company. In general, rate plans that
include a higher monthly access fee typically include a lower usage rate per
minute. An ongoing review of equipment and service pricing is maintained to
ensure the Company's competitiveness. As appropriate, revisions to pricing of
service plans and equipment are made to meet the demands of the local
marketplace. In addition, the Company has recently added Paging as an accessory
to its offered services.


                                       7
<PAGE>

      The following table sets forth a breakdown of the Company's revenues after
giving effect to the Fort Myers and Georgia Sales from the sale of its services
and equipment for the periods indicated.

<TABLE>
<CAPTION>
                                              Company                                     Predecessor
                                   ------------------------------  -------------------------------------------------------
                                   For the Year   October 1, 1997   Nine Months     
                                      Ended           Through         Ended
                                   December 31,     December 31,   September 30,       For The Year Ended December 31,
                                   ------------     ------------   -------------       -------------------------------
                                       1998             1997           1997           1996           1995           1994
                                       ----             ----           ----           ----           ----           ----
<S>                                  <C>              <C>            <C>            <C>              <C>          <C>     
Service Revenue:                                  
      Access and usage (1)           $140,024         $ 31,786       $ 89,339       $105,006         61,607       $ 37,063
      Roaming (2)                      27,029             5,69         14,447         13,099         11,157          5,844
      Long distance (3)                13,045            2,014          5,949          6,632          3,634          2,218
      Other (4)                         4,554              891          2,061          2,596          2,585          2,745
                                     --------         --------       --------       --------       --------       --------
           Total service revenue      184,652           40,382        111,796        127,333         78,983         47,870
Equipment sales and                               
      installation (5)                 12,677            2,308          6,242          7,027          6,830          6,381
                                     --------         --------       --------       --------       --------       --------
           Total                     $197,329         $ 42,690       $118,038       $134,360       $ 85,813       $ 54,251
                                     ========         ========       ========       ========       ========       ========
</TABLE>

(1)   Access and usage revenues include monthly access fees for providing
      service and usage fees based on per minute usage rates.

(2)   Roaming revenues are fees charged for providing services to subscribers of
      other systems when such subscribers or "roamers" place or receive a
      telephone call within one of the Company's service areas.

(3)   Long distance revenue is derived from long distance telephone calls placed
      by the Company's subscribers.

(4)   Other revenue includes, among other things, connect fees charged to
      subscribers for initial activation on the cellular telephone system,
      paging revenue and fees for feature services such as voicemail, call
      forwarding and call waiting.

(5)   Equipment sales and installation revenue includes revenue derived from the
      sale of cellular telephones and fees for the installation of such
      telephones.

      Reciprocal roaming agreements between each of the Company's cellular
telephone systems and the cellular telephone systems of other operators allow
their respective subscribers to place calls in most cellular service areas
throughout the country. Roamers are charged usage fees that are generally higher
than a given cellular telephone system's regular usage fees, thereby resulting
in a higher profit margin on roaming revenue. Roaming revenue is a substantial
source of incremental revenue for the Company. For 1998, roaming revenues
accounted for 14.6% of the Company's service revenues and 13.7% of the Company's
total revenue. This level of roaming revenue is due in part to the fact that the
Company's market in Panama City, Florida is a regional shopping and vacation
destination and a number of the Company's cellular telephone systems in the
Georgia and Alabama market are located along major interstate travel corridors.

      In order to develop the market for cellular telephone service, the Company
provides retail distribution of cellular telephones and maintains inventories of
cellular telephones. The Company negotiates volume discounts for the purchase of
cellular telephones and, in many cases, passes such discounts on to its
customers. The Company believes that earning an operating profit on the sale of
cellular telephones is of secondary importance to offering cellular telephones
at competitive prices to potential subscribers. To respond to competition and to
enhance subscriber growth, the Company has historically sold cellular telephones
below cost.

      The Company is currently developing several new services, which it
believes will provide additional revenue sources. Packet-switching technology
will allow data to be transmitted much more quickly and efficiently than the
current circuit-switching technology. Packet-switching uses the intervals
between voice traffic on cellular channels to send packets of data instead of
tying up dedicated cellular channels. The packets of information, which may be
transmitted using several different channels, are subsequently reassembled and
directed to the correct party at the receiving end. It is expected that the
development of this technology will make it possible for cellular carriers to
offer a broad range of cost-effective wireless data services, including
facsimile and electronic mail transmissions, point-of-sale credit
authorizations, package tracking, remote meter reading, alarm monitoring and
communications between laptop computer units and local area computer networks or
other computer databases. During 1997 the Company began to implement the use of
microcells. Microcells are low powered transmitters, typically constructed on a
pole or the roof of a building, which provide reduced radius service within a
specific area, such as large office buildings, underground facilities or areas
shielded by topographical obstructions. Microcell service could be used, for
instance, to provide wireless service within an office environment that was also
integrated with wireless service to the home.

Customer Service


                                       8
<PAGE>

      The Company is committed to attracting new subscribers and retaining
existing subscribers by providing consistently high-quality customer service. In
each of its cellular service areas, the Company maintains a local staff,
including a store manager, customer service representatives, technical and
engineering staff, sales representatives and installation and repair facilities.
Each cellular service area handles its own customer-related functions such as
customer activations, account adjustments and rate plan changes. Local offices
and installation and repair facilities enable the Company to better service
customers, schedule installations and repairs and monitor the technical quality
of the cellular service areas.

      To ensure high-quality customer service, the Cellular One Group authorizes
a third-party marketing research firm to perform customer satisfaction surveys
of each of its licensees. Licensees must achieve a minimum customer satisfaction
level in order to be permitted to continue using the CELLULARONE service mark.
In 1998, the Company was awarded the #1 MSA in CELLULARONE's National Customer
Satisfaction Survey. The Company has held number one rankings in six out of the
last seven years. The Company believes it has achieved this first place ranking
through effective implementation of its direct sales and customer service
support strategy.

      The Company has implemented a software package to combat cellular
telephone service fraud. This software system can detect counterfeit cellular
telephones while they are being operated and enables the Company to terminate
service to the fraudulent user of the counterfeit cellular telephone. The
Company also helps protect itself from fraud with pre-call customer validation
and subscriber profiles specifically designed to combat the fraudulent use of
subscriber accounts.

Networks

      The Company strives to provide its subscribers with virtually seamless
coverage throughout its cellular service market areas, thereby permitting
subscribers to travel freely within this region and have their calls and custom
calling features, such as voicemail, call waiting and call forwarding, follow
them automatically without having to notify callers of their location or to rely
on special access codes. The Company has been able to offer virtually seamless
coverage by implementing a switch interconnection plan to mobile telephone
switching offices ("MTSO") located in adjoining markets. The Company's equipment
is built by NORTEL, formerly Northern Telecom, Inc. ("NTI"), and interconnection
between MTSOs has been achieved using NTI's internal software and hardware.

      Through its participation in NACN since 1992 and other special networking
arrangements, the Company has pursued its goal of offering seamless regional and
national cellular service to its subscribers. NACN is the largest wireless
telephone network system in the world-linking non-wireline cellular operators
throughout the United States and Canada. Membership in NACN has aided the
Company in integrating its cellular telephone systems within its region and has
permitted the Company to offer cellular telephone service to its subscribers
throughout a large portion of the United States, Canada, Mexico and Puerto Rico.
NACN has provided the Company with a number of distinct advantages: (i) lower
costs for roaming verification, (ii) increased roaming revenue, (iii) more
efficient roaming service and (iv) integration of the Company's markets with
over 4,600 cities in more than 40 states in the United States, Canada, Mexico
and Puerto Rico.

System Development and Expansion

      The Company develops its service areas by adding channels to existing cell
sites and by building new cell sites. Such development is done for the purpose
of increasing capacity and improving coverage in direct response to projected
subscriber demand. Projected subscriber demand is calculated for each cellular
service area on a cell by cell basis. These projections involve a traffic
analysis of usage by existing subscribers and an estimation of the number of
additional subscribers in each such area. In calculating projected subscriber
demand, the Company builds into its design assumptions a maximum call "blockage"
rate of 2.0% (percentage of calls that are not connected on first attempt at
peak usage time during the day).

      The following table sets forth, by market, at the dates indicated, the
number of the Company's operational cell sites.

                      1998       1997       1996       1995       1994
                      ----       ----       ----       ----       ----
Georgia/Alabama ...    223        207        181        121         70

Panama City, FL ...     13         12         11          9          7
                      ----       ----       ----       ----       ----
     Total ........    236        219        192        130         77
                      ====       ====       ====       ====       ====

      The Company constructed 17 cell sites in 1998 and plans to construct 30
additional cell sites with respect to its existing cellular systems during 1999
to meet projected subscriber demand and improve the quality of service. Cell
site expansion is 


                                       9
<PAGE>

expected to enable the Company to continue to add subscribers, enhance use of
its cellular telephone systems by existing subscribers, increase services used
by subscribers of other cellular telephone systems due to the larger geographic
area covered by the cellular telephone network and further enhance the overall
efficiency of the network. The Company believes that the increased cellular
telephone coverage will have a positive effect on market penetration and
subscriber usage.

      Microwave networks enable the Company to connect switching equipment and
cell sites without making use of local landline telephone carriers, thereby
reducing or eliminating fees paid to landline carriers. During 1996, the Company
spent $1.0 million to build additional microwave connections. In addition, in
1996 the Company spent $2.6 million to build a fiber optic network between
Dothan, Alabama and Panama City, Florida. The installation of this network
resulted in savings to the Company from a reduction in fees paid to telephone
companies for landline charges, as well as giving the Company the ability to
lease out a significant portion of capacity.

Digital Cellular Technology

      Over the next decade, it is expected that cellular telephones will
gradually convert from analog to digital technology. This conversion is due in
part to capacity constraints in many of the largest cellular markets, such as
Los Angeles, New York and Chicago. As carriers reach limited capacity levels,
certain calls may be unable to be completed, especially during peak hours.
Digital technology increases system capacity and offers other advantages over
analog technology, including improved overall average signal quality, improved
call security, potentially lower incremental costs for additional subscribers
and the ability to provide data transmission services. The conversion from
analog to digital technology is expected to be an industry-wide process that
will take a number of years. The exact timing and overall costs of such
conversion are not yet known.

      The Company began offering Time Division Multiple Access ("TDMA") standard
digital service, one of three standards for digital service, during 1997. This
digital network allows the Company to offer advanced cellular features and
services such as caller-ID, short message paging and extended battery life.
Where cell sites are not yet at their maximum capacity of radio channels, the
Company is adding digital channels to the network incrementally based on the
relative demand for digital and analog channels. Where cell sites are at full
capacity, analog channels are being removed and redeployed to expand capacity
elsewhere within the network and replaced in such cell sites by digital
channels. The implementation of digital cellular technology over a period of
several years will involve modest incremental expenditures for switch software
and possible significant cost reductions as a result of reduced purchases of
radio channels and a reduced requirement to split existing cells. However, as
indicated above, the extent of any implementation of digital radio channels and
the amount of any cost savings ultimately to be derived therefrom will depend
primarily on subscriber demand. In the ordinary course of business, equipment
upgrades at the cell sites have involved purchasing dual mode radios capable of
using both analog and digital technology.

      The benefits of digital radio channels can only be achieved if subscribers
purchase cellular telephones that are capable of transmitting and receiving
digital signals. Currently, such telephones are more costly than analog
telephones. The widespread use of digital cellular telephones is likely to occur
only over a substantial period of time and there can be no assurance that this
technology will replace analog cellular telephones. In addition, since most of
the Company's existing subscribers currently have cellular telephones that
exclusively utilize analog technology, it will be necessary to continue to
support, and if necessary increase, the number of analog radio channels within
the network for many years.

Acquisitions

      The Company will continue to evaluate expansion through acquisitions of
both (i) contiguous cellular properties and other strategically located RSAs and
small to mid-sized MSAs and (ii) minority interests in its existing cellular
properties. In evaluating acquisition targets, the Company considers, among
other things, demographic factors, including population size and density,
geographic proximity to existing service areas, traffic patterns, cell site
coverage and required capital expenditures.

      On June 20, 1996, the Company acquired the cellular telephone system of
USCOC of Georgia RSA #1, Inc. ("USCOC") for an aggregate purchase price of $31.6
million including the cellular telephone system in the Georgia-1 RSA. The
cellular telephone system in the acquired RSA serves a geographic territory of
northwest Georgia between Chattanooga and Atlanta.

      On July 5, 1996, two of the Company's majority-owned subsidiaries acquired
the cellular telephone system of Horizon Cellular Telephone Company of Spalding,
L.P. ("Horizon") for an aggregate purchase price of $36.0 million including the
cellular telephone system in the Georgia-6 RSA. The cellular telephone system in
the acquired RSA serves a geographic territory of west central Georgia adjacent
to the Macon and Columbus, Georgia MSAs.


                                       10
<PAGE>

      On January 31, 1997, a majority-owned subsidiary of the Company acquired
the cellular telephone system serving the Georgia-13 RSA from Mobile
Communications Systems L.P. for a total purchase price of $31.5 million, which
serves a geographic territory of southwest Georgia adjacent to the Albany,
Georgia and Dothan, Alabama MSAs.

Competition

      The cellular telephone service industry in the United States is highly
competitive. Cellular telephone systems compete principally on the basis of
services and enhancements offered, the technical quality of the cellular system,
customer service, coverage capacity and price of service and equipment.
Currently, the Company's primary competition in each of its service areas is the
other cellular licensee-the wireline carrier. The table below lists the wireline
competitor in each of the Company's existing service areas:

      Market                               Wireline Competitor
      ------                               -------------------
      Albany, GA.........................  ALLTEL
      Augusta, GA........................  ALLTEL
      Columbus, GA.......................  Public Service Cellular
      Macon, GA..........................  BellSouth
      Savannah, GA.......................  ALLTEL
      Georgia-6 RSA......................  BellSouth and Intercel(1)
      Georgia-7 RSA......................  ALLTEL and BellSouth(1)
      Georgia-8 RSA......................  ALLTEL
      Georgia-9 RSA......................  ALLTEL and Public Service Cellular(1)
      Georgia-10 RSA.....................  ALLTEL
      Georgia-12 RSA.....................  ALLTEL
      Georgia-13 RSA.....................  ALLTEL
      Dothan, AL.........................  BellSouth
      Montgomery, AL.....................  ALLTEL
      Alabama-8 RSA......................  ALLTEL
      Panama City, FL....................  ALLTEL

(1)   The purchasers of the authorization have subdivided the wireline service
      area into two service areas for the RSA.

      The Company also faces limited competition from and may in the future face
increased competition from broadband PCS. Broadband PCS involves a network of
small, low-powered transceivers placed throughout a neighborhood, business
complex, community or metropolitan area to provide customers with mobile and
portable voice and data communications. PCS subscribers communicate using
digital radio handsets.

      The FCC allocated 120 MHz of spectrum for licensed broadband PCS. The
allocations for licensed PCS services are split into six blocks of frequencies-
blocks "A" and "B" being two 30 MHz allocations for each of the 51 Major Trading
Areas ("MTAs") throughout the United States; block "C" being one 30 MHz
allocation in each of 493 Basic Trading Areas ("BTAs") in the United States; and
blocks "D," "E" and "F" being three 10 MHz allocations in each of the BTAs. The
FCC has concluded the initial auction of all broadband PCS frequency blocks,
although a limited number of PCS licenses are from time to time reauctioned due
to a failure of the initial auction winner to complete the required payments for
the licenses.

      The Company also faces competition from other existing communications
technologies such as conventional mobile telephone service, SMR and ESMR systems
and paging services.

      In addition, the FCC has licensed operators to provide mobile satellite
service in which transmissions from mobile units to satellites would augment or
replace transmissions to land-based stations. Although such a system is designed
primarily to serve remote areas and is subject to transmission delays inherent
in satellite communications, a mobile satellite system could augment or replace
communications with segments of land-based cellular systems. Based on current
technologies, however, satellite transmission services are not expected to be
competitively priced with cellular telephone services.

      In order to grow and compete effectively in the wireless market, the
Company plans to follow a strategy of increasing its bundled minute offerings.
By increasing the number of minutes a customer can use for one flat rate,
subscribers perceive greater value in their cellular service and become less
usage sensitive, i.e., they can increase their cellular phone usage without
seeing large corresponding increases in their cellular bill. These factors
translate into more satisfied customers, greater customer usage 


                                       11
<PAGE>

and lower churn among existing subscribers. The perceived greater value also
increases the number of potential customers in the marketplace. The Company
believes that this strategy will enable it to increase its share of the wireless
market.

Service Marks

      CELLULARONE is a registered service mark with the U.S. Patent and
Trademark Office. The service mark is owned by Cellular One Group, a Delaware
general partnership of Cellular One Marketing, Inc., a subsidiary of
Southwestern Bell Mobile Systems, Inc., together with Cellular One Development,
Inc., a subsidiary of AT&T and Vanguard Cellular Systems, Inc. The Company uses
the CELLULARONE service mark to identify and promote its cellular telephone
service pursuant to licensing agreements with Cellular One Group. In 1998, the
Company paid $290,000 in licensing and advertising fees under these agreements.
See "Risk Factors--Reliance on Use of Third-Party Service Mark."

Description of Cellular One Agreements

      The Company is currently party to sixteen license agreements with Cellular
One Group, which cover separate cellular telephone system areas. The terms of
each agreement (each, a "Cellular One Agreement") are substantially identical.
Pursuant to each Cellular One Agreement, Cellular One Group has granted a
license to use the "CELLULARONE" mark (the "Mark") in its FCC- licensed
territory (the "Licensed Territory") to promote its cellular telephone service.
Cellular One Group has agreed not to license such mark to any other cellular
telephone service provider in such territory during the term of the agreement.

      Each Cellular One Agreement has a term of five years and is renewable,
subject to the conditions described herein, at the option of the Company for
three additional five-year terms subject to provision of advanced written notice
by the Company. In connection with any renewal, the Company must execute
Cellular One Group's then-current form of license renewal agreement, which form
may contain provisions materially different than those in the Cellular One
Agreement.

      Cellular One Group may terminate the Cellular One Agreements at any time
without written notice to the Company upon certain events, including bankruptcy,
insolvency and dissolution of the Company.

      Cellular One Group may terminate the Cellular One Agreements if the
Company (i) fails to pay any amounts thereunder when due or fails to submit
information required to be provided pursuant to the Cellular One Agreement when
due or makes a false statement in connection therewith, (ii) fails to operate
its business in conformity with FCC directives, technical industry standards and
other standards specified from time to time by Cellular One Group, (iii)
misuses, makes unauthorized use of or materially impairs the goodwill of the
Mark, (iv) engages in any business under a name that is confusingly similar to
the Mark, or (v) permits a continued violation of any law or regulation
applicable to it, in each case subject to a thirty-day cure period.

      The Cellular One Agreements are terminable by the Company at any time
subject to 120 days' written notice.

      The Company has agreed to indemnify Cellular One Group and its employees
and affiliates, including its constituent partners, against all claims arising
from the operation of its cellular phone business and the costs, including
attorneys fees, of defending against them.

Regulation

      As a provider of cellular telephone services, the Company is subject to
extensive regulation by the federal government.

      The licensing, construction, operation, acquisition and transfer of
cellular telephone systems in the United States are regulated by the FCC
pursuant to the Communications Act of 1934, as amended (the "Communications
Act"). The FCC has promulgated rules governing the construction and operation of
cellular telephone systems and licensing and technical standards for the
provision of cellular telephone service ("FCC Rules"). For cellular licensing
purposes, the United States is divided into MSAs and RSAs. In each market, the
frequencies allocated for cellular telephone use are divided into two equal
blocks designated as Block A and Block B. Block A licenses were initially
reserved for non-wireline companies, such as Palmer, while Block B licenses were
initially reserved for entities affiliated with a local wireline telephone
company. Under current FCC Rules, a Block A or Block B license may be
transferred with FCC approval without restriction as to wireline affiliation,
but generally, no entity may own any substantial interest in both systems in any
one MSA or RSA. The FCC may prohibit or impose conditions on sales or transfers
of licenses.


                                       12
<PAGE>

      Initial operating licenses are generally granted for terms of up to 10
years, renewable upon application to the FCC. Licenses may be revoked and
license renewal applications denied for cause after appropriate notice and
hearing. The Company's cellular licenses expire in the following years with
respect to the following number of service areas: 2000 (two); 2001 (four); 2002
(two); 2006 (one); 2007 (four), and 2008 (three). The FCC has issued a decision
confirming that current licensees will be granted a renewal expectancy if they
have complied with their obligations under the Communications Act during their
license terms and provided substantial public service. A potential challenger
will bear a heavy burden to demonstrate that a license should not be renewed if
the licensee's performance merits renewal expectancy. The Company believes that
the licenses it controls will continue to be renewed in a timely manner.
However, in the event that a license is not renewed, the Company would no longer
have the right to operate in the relevant service area. A non-renewal of all
licenses that are currently pending would have a material adverse effect on the
Company's results of operations.

      Under FCC rules, each cellular licensee was given the exclusive right to
construct one of two cellular telephone systems within the licensee's MSA or RSA
during the initial five-year period of its authorization. At the end of such
five-year period, other persons are permitted to apply to serve areas within the
licensed market that are not served by the licensee and current FCC Rules
provide that competing applications for these "unserved areas" are to be
resolved through the auction process. The Company has no material unserved areas
in any of its cellular telephone systems that have been licensed for more than
five years.

      The Company also regularly applies for FCC authority to use additional
frequencies, to modify the technical parameters of existing licenses, to expand
its service territory and to provide new services. The Communications Act
requires prior FCC approval for acquisitions by the Company of other cellular
telephone systems licensed by the FCC and transfers by the Company of a
controlling interest in any of its licenses or construction permits, or any
rights thereunder. Although there can be no assurance that any future requests
for approval or applications filed by the Company will be approved or acted upon
in a timely manner by the FCC, based upon its experience to date, the Company
has no reason to believe such requests or applications would not be approved or
granted in due course.

      The Communications Act prohibits the holding of a common carrier license
(such as the Company's cellular licenses) by a corporation of which more than
20% of the capital stock is owned directly or beneficially by aliens. Where a
corporation such as the Company controls another entity that holds an FCC
license, such corporation may not have more than 25% of its capital stock owned
directly or beneficially by aliens, in each case, if the FCC finds that the
public interest would be served by such prohibitions. These limitations have
been relaxed with regard to certain foreign investors pursuant to a World Trade
Organization treaty and FCC actions implementing the treaty. Failure to comply
with these requirements may result in the FCC issuing an order to the Company
requiring divestiture of alien ownership to bring the Company into compliance
with the Communications Act. In addition, fines or a denial of renewal, or
revocation of the license are possible.

      From time to time, legislation that could potentially affect the Company,
either beneficially or adversely, may be proposed by federal and state
legislators. On February 8, 1996, the Telecommunications Act of 1996 (the
"Telecom Act") was signed into law, revising the Communications Act to eliminate
unnecessary regulation and to increase competition among providers of
communications services. The Company cannot predict the future impact of this or
other legislation on its operations.

      The major provisions of the Telecom Act potentially affecting the Company
are as follows:

      Interconnection. The Telecom Act required state public utilities
commissions and the FCC to implement policies that mandate cost-based reciprocal
compensation between cellular carriers and local exchange carriers ("LEC") for
interconnection services.

      On August 8, 1996, the FCC released its First Report and Order in the
matter of Implementation of the Local Competition Provisions in the
Telecommunications Act of 1996 ("FCC Order") establishing the rules for the
costing and provisioning of interconnection services and the offering of
unbundled network elements by incumbent local exchange carriers. The FCC Order
established procedures for Palmer's renegotiations of interconnection agreements
with the incumbent local exchange carrier in each of Palmer's markets. LECs and
state regulators filed appeals of the FCC Order, which were consolidated in the
US Court of Appeals for the Eighth Circuit. The Court rejected most of the rules
promulgated in the FCC Order. However, on further appeal, the United States
Supreme Court revised most of the court's actions and remanded the case to the
courts and the FCC for further consideration. Pending further court action, much
of the FCC Order will take effect.


                                       13
<PAGE>

      The Company has renegotiated certain interconnection agreements with
incumbent LECs in most of the Company's markets. These negotiations have
resulted in a substantial decrease in interconnection expenses incurred by the
Company.

      Facilities siting for personal wireless services. The siting and
construction of cellular transmitter towers, antennas and equipment shelters are
often subject to state or local zoning, land use and other regulation. Such
regulation may require zoning, environmental and building permit approvals or
other state or local certification.

      The Telecom Act provides that state and local authority over the
placement, construction and modification of personal wireless services
(including cellular and other commercial mobile radio services and unlicensed
wireless services) shall not prohibit or have the effect of prohibiting personal
wireless services or unreasonably discriminate among providers of functionally
equivalent services. In addition, local authorities must act on requests made
for siting in a reasonable period of time and any decision to deny must be in
writing and supported by substantial evidence. Appeals of zoning decisions that
fail to comply with the provisions of the Telecom Act can be made on an
expedited basis to a court of competent jurisdiction, which can be either
federal district or state court. The Company anticipates that, as a result of
the Telecom Act, it will more readily receive local zoning approval for proposed
cellular base stations. In addition, the Telecom Act codified the Presidential
memorandum on the use of federal lands for siting wireless facilities by
requiring the President or his designee to establish procedures whereby federal
agencies will make available their properties, rights of ways and other
easements at a fair and reasonable price for service dependent upon federal
spectrum.

      Environmental effect of radio frequency emissions. The Telecom Act
provides that state and local authorities cannot regulate personal wireless
facilities based on the environmental effects of radio frequency emissions if
those facilities comply with the federal standard.

      Universal service. The Telecom Act also provides that all communications
carriers providing interstate communications services, including cellular
carriers, must contribute to the federal universal service support mechanisms
established by the FCC. . The FCC also provided that any cellular carrier is
potentially eligible to receive universal service support. The universal service
support fund will support telephone service in high-cost and low-income areas
and support access to telecommunications facilities by schools, libraries and
rural health care facilities. States will also be implementing requirements that
carriers contribute universal service funding from intrastate telecommunications
revenues. The Company has revised its customer billing to reflect additional
costs related to this universal service fund requirements. There can be no
guarantee that the Company will be able to continue to pass the costs of the
fund requirements on to its subscribers in the future.

      The FCC has implemented its cellular-PCS cross ownership rule, but has
retained a spectrum cap on aggregation of CMRS spectrum. A cellular licensee and
its affiliates may not hold an attributable interest in more than 45 MHz of
licensed cellular, broadband PCS and SMRS in a particular geographic area.

      The Communications Act preempts state and local regulation of the entry
of, or the rates charged by, any provider of cellular service.

Certain Terms

      Interests in cellular markets that are licensed by the FCC are commonly
measured on the basis of the population of the market served, with each person
in the market area referred to as a "Pop." The number of Pops or Net Pops owned
is not necessarily indicative of the number of subscribers or potential
subscribers. As used herein, unless otherwise indicated, the term "Pops" means
the estimate of the 1998 population of an MSA or RSA, as derived from the 1998
Donaldson, Lufkin, & Jenrette Market Information Service. The term "Net Pops"
means the estimated population with respect to a given service area multiplied
by the percentage interest that the Company owns in the entity licensed in such
service area. MSAs and RSAs are also referred to as "markets." The term
"wireline" license refers to the license for any market initially awarded to a
company or group that was affiliated with a local landline telephone carrier in
the market, and the term "non-wireline" license refers to the license for any
market that was initially awarded to a company, individual or group not
affiliated with any landline carrier. The term "System" means an FCC-licensed
cellular telephone system. The term "CTIA" means the Cellular Telecommunications
Industry Association.

Employees

      At December 31, 1998, the Company had 569 full-time employees, none of
whom is represented by a labor organization. Management considers its relations
with employees to be good.


                                       14
<PAGE>

Item 2. PROPERTIES

      For each market served by the Company's operations, the Company maintains
at least one sales or administrative office and operates a number of cell
transmitter and antenna sites. As of December 31, 1998, the Company had
approximately 35 leases for retail stores used in conjunction with its
operations and 3 leases for administrative offices. The Company also had
approximately 142 leases to accommodate cell transmitters and antennas as of
December 31, 1998.

Item 3. LEGAL PROCEEDINGS

      The Company is not currently involved in any pending legal proceedings
likely to have a material adverse impact on the Company.

Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

      Not Applicable

Item 5. MARKET FOR COMPANY'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS

   a) Market for Common Stock

      Not Applicable

   b) Holders

      All of the issued and outstanding capital stock of PCW is held
beneficially and of record by Holdings.

   c) Dividends

      PCW, to date, has paid no cash dividends on its Common Stock. The Senior
Secured Note Indenture imposes substantial restrictions on PCW's ability to pay
dividends to Holdings. It is not anticipated that dividends will be paid on
PCW's capital stock in the foreseeable future.


                                       15
<PAGE>

Item 6. SELECTED CONSOLIDATED FINANCIAL DATA

      The following table contains certain consolidated financial data with
respect to the Company for the period ended December 31, 1998, May 29, 1997
through December 31, 1997 and for Palmer ("Predecessor") for the periods and
dates set forth below. This information has been derived from the audited
consolidated financial statements of the Company and Palmer.

      The following data should be read in conjunction with "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and
the Consolidated Financial Statements and Notes thereto, included elsewhere
herein.

<TABLE>
<CAPTION>
                                                                  Company                          Predecessor
                                                         ------------------------  -----------------------------------------------
                                                                        For the
                                                                        Period
                                                                     May 29, 1997  For the Nine
                                                                        Through    Months Ended
                                                                      December 31, September 30,
                                                            1998          1997         1997       1996(3)     1995(2)     1994(1)
                                                            ----          ----         ----       -------     -------     -------
                                                                  (In Thousands, Except Percentage And Per Subscriber Data)
<S>                                                      <C>           <C>           <C>         <C>         <C>         <C>      
Consolidated Statement Of Operations Data:
Revenue:
  Service .............................................  $   184,652   $    41,365   $ 134,123   $ 151,119   $  96,686   $  61,021
  Equipment sales and installation                            12,677         2,348       7,613       8,624       8,220       7,958
                                                         -----------   -----------   ---------   ---------   ---------   ---------
    Total revenue .....................................      197,329        43,713     141,736     159,743     104,906      68,979
                                                         -----------   -----------   ---------   ---------   ---------   ---------
  Engineering, technical and other direct expenses ....       30,022         5,978      23,301      28,717      18,184      12,776
  Cost of equipment ...................................       23,710         5,259      16,112      17,944      14,146      11,546
  Selling, general and administrative expenses ........       55,002        12,805      41,014      46,892      30,990      19,757
  Depreciation and amortization .......................       43,569        11,055      25,498      25,013      15,004       9,817
                                                         -----------   -----------   ---------   ---------   ---------   ---------
  Operating income ....................................       45,026         8,616      35,811      41,177      26,582      15,083
                                                         -----------   -----------   ---------   ---------   ---------   ---------
  Other income (expense):
    Interest, net .....................................      (77,510)      (22,198)    (24,467)    (31,462)    (21,213)    (12,715)
    Other, net ........................................          (19)           15         208        (429)       (687)        (70)
                                                         -----------   -----------   ---------   ---------   ---------   ---------
        Total other expenses ..........................      (77,529)      (22,183)    (24.259)    (31,891)    (21,900)    (12,785)
                                                         -----------   -----------   ---------   ---------   ---------   ---------
  Minority interest share of (income) losses ..........       (2,178)         (414)     (1,310)     (1,880)     (1,078)       (636)
  Income tax benefit (expense) ........................       12,831         5,129      (4,153)     (2,724)     (2,650)          0
                                                         -----------   -----------   ---------   ---------   ---------   ---------
        Income (loss) before extraordinary item .......      (21,850)       (8,852)      6,089       4,682         954      (1,662)
  Extraordinary item - Loss on early extinguishment
    of debt (net of tax benefit of $ 14,885) ..........      (25,344)           --          --          --          --          --
                                                         -----------   -----------   ---------   ---------   ---------   ---------
        Net income (loss) .............................  $   (47,194)  $    (8,852)  $   6,089   $   4,682   $     954      (1,662)
                                                         ===========   ===========   =========   =========   =========   =========
Other Data:
Capital expenditures ..................................  $    14,725   $    14,499   $  40,757   $  41,445   $  36,564   $  22,541
Operating income before depreciation and amortization  
  ("EBITDA")(4) .......................................  $    88,595   $    19,671   $  61,309   $  66,190   $  41,586   $  24,900
EBITDA margin on service revenue ......................         48.0%         47.6%       45.7%       43.8%       43.0%       40.8%
Net cash provided by (used in):
  Operating activities ................................  $    15,571   $    11,313   $  38,791   $  30,130   $  27,660   $   7,238
  Investing activities ................................      (12,725)     (321,030)    (73,759)   (110,610)   (196,610)   (116,850)
  Financing activities ................................       78,365       337,643      36,851      78,742     169,554     110,940
Penetration(5) ........................................         11.6%         9.40%       8.60%       7.45%       6.41%       4.58%
Subscribers at end of period(6) .......................      381,977       309,606     337,345     279,816     211,985     117,224

Cost to add a net subscriber(7) .......................  $       448   $       370   $     514   $     407   $     276   $     247
Average monthly service revenue per subscriber(8) .....  $     51.67   $     50.59   $   53.99   $   52.20   $   56.68   $   60.02
  Average monthly churn(9) ............................         1.91%         1.84%       1.89%       1.84%       1.55%       1.55%
  Ratio of earnings to fixed charges(10) ..............          N/A           N/A       1.45x       1.28x       1.21x      1. 17x

Consolidated Balance Sheet Data:
  Cash ................................................  $   109,137   $    27,926   $   3,581   $   1,698   $   3,436   $   2,998
  Restricted cash(11) .................................       79,081            --          --          --          --          --
  Working capital (deficit) ...........................      172,976         3,080       7,011         296      (1,435)      2,490
  Property and equipment, net .........................      144,828       151,141     161,351     132,438     100,936      51,884
  Licenses and other intangibles, net .................      876,952       937,986     406,828     387,067     332,850     199,265
    Total assets ......................................    1,263,734     1,144,479     599,815     549,942     462,871     273,020
  Long-term debt ......................................      700,000       610,188     378,000     343,662     350,441     245,609
  Obligation of parent company(11) ....................      209,432        80,112          --          --          --          --
    Stockholder's equity (deficit) ....................      (12,031)       35,163     172,018     164,930      74,553       4,915
</TABLE>


                                       16
<PAGE>

(1)   Includes the Georgia Acquisition (as defined herein), that occurred on
      October 31, 1994. For the two months ended December 31, 1994, the Georgia
      Acquisition resulted in revenues to Palmer of $1.8 million and operating
      loss of $645,000.

(2)   Includes the GTE Acquisition (as defined herein), that occurred on
      December 1, 1995. For the one month ended December 31, 1995, the GTE
      Acquisition resulted in revenues, to Palmer of $2.2 million and operating
      income of $208,000.

(3)   Includes the acquisition of the cellular telephone systems of USCOC (as
      defined herein) (Georgia-1 RSA), which occurred on June 20, 1996, and
      Horizon (as defined herein) (Georgia-6 RSA), which occurred on July 5,
      1996. The acquisitions of USCOC and Horizon resulted in revenues to Palmer
      of $1.2 million and $2.7 million respectively, and operating (loss) income
      of $(278,000) and $743,000 respectively, during such year.

(4)   EBITDA should not be considered in isolation or as an alternative to net
      income (loss), operating income (loss) or any other measure of performance
      under GAAP. The Company believes that EBITDA is viewed as a relevant
      supplemental measure of performance in the cellular telephone industry.

(5)   Determined by dividing the aggregate number of subscribers by the
      estimated population.

(6)   Each billable telephone number in service represents one subscriber.

(7)   Determined for a period by dividing (i) costs of sales and marketing,
      including salaries, commissions and employee benefits and all expenses
      incurred by sales and marketing personnel, agent commissions, credit
      reference expenses, losses on cellular telephone sales, rental expenses
      allocated to retail operations, net installation expenses and other
      miscellaneous sales and marketing charges for such period, by (ii) the net
      subscribers added during such period.

(8)   Determined for a period by dividing (i) the sum of the access, airtime,
      roaming (including incollect), long distance, features, connection,
      disconnection and other revenues for such period by (ii) the average
      number of subscribers for such period divided by the number of months in
      such period.

(9)   Determined for a period by dividing total subscribers discontinuing
      service by the average number of subscribers for such period, and dividing
      that result by the number of months in such period.

(10)  The ratio of earnings to fixed charges is determined by dividing the sum
      of earnings before interest expense, taxes and a portion of rent expense
      representative of interest by the sum of interest expense and a portion of
      rent expense representative of interest. The ratio of earnings to fixed
      charges is not meaningful for periods that result in a deficit. For the
      year ended December 31, 1998 and for the period May 29, 1997 through
      December 31, 1997 such deficits for the Company were $47,194 and $8,852,
      respectively.

(11)  Restricted cash and Parent company obligations represent cash belonging to
      Holdings and debt owed by Holdings that are reflected on the balance sheet
      pursuant to "push down" accounting rules. The Company has neither rights
      with respect to such cash nor liability with respect to such debt
      obligation.

Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

      The following discussion is intended to facilitate an understanding and
assessment of significant changes and trends related to the financial condition
and results of operations of the Company. This discussion should be read in
conjunction with the Company's Consolidated Financial Statements and related
Notes thereto. References to the Company also include its predecessor, Palmer.

      Results for the Predecessor for the year ended December 31, 1996 are based
solely on the historical operations of the Predecessor prior to the Merger. The
discussion for the year ended December 31, 1997 is based upon the results of the
Predecessor through September 30, 1997 and the results of the Company from
October 1, 1997 to December 31, 1997 (except for a minimal amount of net
interest expense from May 29, 1997 to December 31, 1997). The comparison for the
year ended December 31, 1998 versus December 31, 1997 is for the full
twelve-month period and combines the results of the predecessor with the results
for the Company. The audited financial statements of the Company do not include
such combined financial statements, as this would not be in conformity with
GAAP.

Overview

      PCW, a wholly owned subsidiary of Holdings, a wholly-owned subsidiary of
Price Communications Cellular, Inc., a wholly-owned subsidiary of PCC, was
incorporated on May 29, 1997 in connection with the purchase of Palmer.

      In May 1997, PCC, PCW and Palmer entered into an Agreement and Plan of
Merger (the "Merger Agreement"). The Merger Agreement provided, among other
things, for the merger of PCW with and into Palmer with Palmer as the surviving
corporation (the "Merger"). In October, 1997, the Merger was consummated and
Palmer changed its name to "Price Communications Wireless, Inc." Pursuant to the
Merger Agreement, PCC acquired each issued and outstanding share of common 


                                       17
<PAGE>

stock of Palmer for a purchase price of $17.50 per share in cash and purchased
outstanding options and rights under employee and direct stock purchase plans
for an aggregate price of $486.4 million. In addition, as a result of the
Merger, PCW assumed all outstanding indebtedness of Palmer of approximately
$378.0 million. As a result, the aggregate purchase price for Palmer (including
transaction fees and expenses) was approximately $880.0 million. PCW refinanced
all of the Palmer Existing Indebtedness concurrently with the consummation of
the Merger.

      PCW entered into an agreement to sell Palmer's Fort Myers, Florida MSA
covering approximately 382,000 Pops for $168.0 million (the "Fort Myers Sale").
In October 1997, the Fort Myers Sale was consummated, and generated proceeds to
the Company of approximately $166.0 million. The proceeds of the Fort Myers Sale
were used to fund a portion of the acquisition of Palmer. Accordingly, no gain
or loss was recognized on the Fort Myers Sale.

      On October 21, 1997, PCC and PCW entered into an Asset Purchase Agreement
with MJ Cellular Company, L.L.C. which provided for the sale by PCW, for $25.0
million, of substantially all of the assets of the non- wireline cellular
telephone system serving the Georgia-1RSA ("Georgia-1"), including the FCC
licenses to operate Georgia-1 (the "Georgia Sale"). The sale of the assets of
Georgia-1 was consummated on December 30, 1997 for $24.2 million. The proceeds
from the Georgia Sale were used to retire a portion of the debt used to fund the
acquisition of Palmer. Accordingly, no gain or loss was recognized on the
Georgia Sale.

      In order to fund the Acquisition and pay related fees and expenses, in
July, 1997, PCW issued $175.0 million aggregate principal amount of 11 3/4%
Senior Subordinated Notes due 2007 and entered into a syndicated senior loan
facility providing for term loan borrowings in the aggregate principal amount of
approximately $325.0 million and revolving loan borrowings of $200.0 million. In
October 1997, PCW borrowed all term loans available thereunder and approximately
$120.0 million of revolving loans.

      The acquisition of Palmer was also funded through an equity contribution
of PCC and borrowings of Holdings.

      The Company is engaged in the construction, development, management and
operation of cellular telephone systems in the southeastern United States. As of
December 31, 1998, the Company provided cellular telephone service to 381,977
subscribers in Alabama, Florida and Georgia in a total of 16 licensed service
areas, composed of eight MSA's and eight RSA's, with an aggregate estimated
population of 3.3 million. The Company sells its cellular telephone service as
well as a full line of cellular products and accessories principally through its
network of retail stores. The Company markets all of its products and services
under the nationally recognized service mark CELLULAR ONE.

Acquisitions

      On February 1, 1997, one of the Company's majority-owned subsidiaries
acquired the assets of and the license to operate the non-wireline cellular
telephone system serving the Georgia-13 RSA, for a total purchase price of $31.5
million, subject to certain adjustments.

      On October 6, 1997, as part of the Acquisition of Palmer by the Company,
the Fort Myers MSA was sold for approximately $168.0 million.

      On December 30, 1997, the Company sold the assets of and license to
operate the non-wireline cellular telephone system serving Georgia Rural Service
Area Market No. 371, otherwise known as Georgia-1 RSA for a total price of $24.2
million, subject to certain adjustments.

      As stated above, the Fort Myers and GA-1 markets were sold during the
latter part of 1997 making the operating results for the year ended December 31,
1998 versus the year ended December 31, 1997 not comparable. The following
highlights compare the operations for the years ended December 31, 1998 and 1997
after adjusting 1997 for such sales:


                                       18
<PAGE>

                                                       Years Ended December 31,
                                                       ------------------------
                                                         1998            1997
                                                         ----            ----
Service revenue                                        $184,652        $152,178
Operating cash flow ("EBITDA")                           88,595          70,033
EBITDA % (% of service revenue)                            48.0%           46.0%
Subscriber growth                                        72,385          55,632
Average monthly revenue per sub                        $  51.67        $  52.06
Average monthly operating costs per sub                $  23.17        $  24.67
Local minutes of use (in thousands)                     768,707         506,097

Results of Operations

     The following table sets forth for the Company, for the periods indicated,
the percentage which certain amounts bear to total revenue.

<TABLE>
<CAPTION>
                                                                 Company                           Predecessor
                                                      ------------------------------     ------------------------------
                                                                      For the Period       For the
                                                        For the        May 29, 1997      Nine Months         For the
                                                       Year Ended         Through           Ended           Year Ended
                                                      December 31,      December 31,     September 30,     December 31,
                                                          1998              1997              1997              1996
                                                        ------            ------            ------            ------
<S>                                                      <C>               <C>               <C>               <C>  
Revenue:
     Service .......................................      93.6%             94.6%             94.6%             94.6%
     Installation ..................................       6.4               5.4               5.4               5.4
                                                        ------            ------            ------            ------
Total Revenue ......................................     100.0             100.0             100.0             100.0
                                                        ------            ------            ------            ------
Operating Expenses:
     Engineering, technical and other direct:
        Engineering and technical(1) ...............       7.3               7.2               8.0               7.9
        Other direct costs of services(2) ..........       8.0               6.5               8.4              10.1
     Cost of equipment(3) ..........................      12.0              12.0              11.4              11.2
     Selling, general and administrative:
        Selling and Marketing(4) ...................       9.9               8.9               8.4               8.6
        Customer Service(5) ........................       6.3               6.2               6.3               5.9
        General and administrative(6) ..............      11.6              14.2              14.2              14.9
     Depreciation and amortization .................      22.1              25.3              18.0              15.7
                                                        ------            ------            ------            ------
Total Operating Expenses ...........................      77.2              80.3              74.7              74.3
                                                        ------            ------            ------            ------
Operating Income ...................................      22.8%             19.7%             25.3%             25.7%
Operating Income Before Depreciation And
   Amortization(7)..................................      44.9%             45.0%             43.3%             41.4%
</TABLE>

(1)   Consists of costs of cellular telephone network, including inter-trunk
      costs, span-line costs, cell site repairs and maintenance, cell site
      utilities, cell site rent, engineers' salaries and benefits and other
      operational costs.

(2)   Consists of net costs of incollect roaming, costs of long distance, costs
      of interconnection with wireline telephone companies and other costs of
      services.

(3)   Consists primarily of the costs of the cellular telephones and accessories
      sold.

(4)   Consists primarily of salaries and benefits of sales and marketing
      personnel, advertising and promotional expenses, and employee and agent
      commissions.

(5)   Consists primarily of salaries and benefits of customer service personnel
      and costs of printing and mailing billings generated in-house.

(6)   Includes salaries and benefits of general and administrative personnel and
      other overhead expenses.

(7)   Operating income before depreciation and amortization should not be
      considered in isolation or as an alternative to net income, operating
      income or any other measure of performance under generally accepted
      accounting principles. The Company believes that operating income before
      depreciation and amortization is viewed as a relevant supplemental measure
      of performance in the cellular telephone industry.

Year Ended December 31, 1998 Compared To Year Ended December 31, 1997

      Revenue. Service revenues totaled $184.7 million for 1998, an increase of
5.2% over $175.5 million for 1997. The increase is primarily attributable to a
24.5% increase in the average number of subscribers to 345,490 for 1998 versus
277,487 for 1997 after adjusting for the sale of the Fort Myers and GA-1
markets. Substantially offsetting this increase is the loss of service revenue
of the cellular telephone systems resulting from the sale of Fort Myers and
GA-1, which approximated $21.1 million. The increase in subscribers is the
result of internal growth, which the Company attributes primarily to its strong
sales and marketing efforts. In addition to the subscriber base growth, service
revenues also increased because of a significant increase in the minutes of use
for the Company's subscribers.


                                       19
<PAGE>

      Average monthly revenue per subscriber (which excludes incollect revenue)
decreased 2.5% to $44.54 for 1998 from $45.70 for 1997. The decrease is below
the industry average. Revenue includes service revenue and incollect revenue,
which is offset against cost of service for financial reporting purposes. This
modest decrease is due to a common trend in the cellular telephone industry,
where on average, new customers use less airtime than existing subscribers.
Therefore, service revenues generally do not increase proportionately with the
increase in subscribers. In addition, the decline reflects more competitive rate
plans introduced into the Company's markets.

      Equipment sales and installation revenue, which consists primarily of
cellular subscriber equipment sales, increased to $12.7 million for 1998 from
$10.0 million for 1997. As a percentage of total cellular revenue, equipment
sales and installation revenue increased to 6.4% of service revenue from 5.4%
for 1997 reflecting the increased recurring revenue base as well as the ability
to obtain increased prices for our cellular equipment sold to customers.

      Operating Expenses. Engineering and technical expenses decreased slightly
by 2.1% to $14.3 million for 1998 from $14.6 million in 1997. As a percentage of
revenue, engineering and technical expenses decreased to 7.3 % of total revenue
from 7.9% for 1997. This reflects the increased costs associated with increased
minutes of usage by our subscribers offset by the expenses associated with the
markets sold which approximated $1.3 million.

      Other direct costs of services increased to $15.7 million in 1998 from
$14.7 million in 1997. As a percentage of revenue, other direct costs of service
was basically flat increasing from 7.9% in 1997 to 8.0% in 1998, reflecting the
increase in minutes of usage by our customers as they roam in other markets.
Other direct costs of service related to the Fort Myers and GA-1 markets
approximated $3.0 million.

      The cost of equipment increased 10.7% to $23.7 million for 1998 from $21.4
million for 1997, due primarily to the increase in gross subscriber activations.
Equipment sales resulted in losses of $11.0 million in 1998 versus $11.4 million
in 1997. The Company sells equipment below its costs in an effort to address
market competition and improve market share. The Company was able to reduce its
losses by obtaining better prices from its customers as well as obtaining better
prices from its suppliers.

      Selling, general and administrative expenses increased a modest 2.2% to
$55.0 million in 1998 from $53.8 million in 1997. These expenses are comprised
of (i) sales and marketing costs, (ii) customer service costs and (iii) general
and administrative expenses.

      Sales and marketing costs increased 23.4% to $19.5 million for 1998 from
$15.8 million for 1997. This increase is primarily due to an 8.0% increase in
gross subscriber activations (excluding prepaids) and the costs to acquire them
and higher advertising costs in response to market competition. As the level of
penetration increases, the sales and marketing costs associated with acquiring
additional subscribers increases. As a percentage of total revenue, sales and
marketing costs increased to 9.9% for 1998 compared to 8.5% for 1997. The
Company's cost to add a net subscriber, including loss on telephone sales,
decreased to $448 for 1998 from $469 for 1997. Sales and marketing expenses
associated with the Fort Myers and GA-1 markets approximated $1.2 million.

      Customer service costs increased 6.8% to $12.5 million for 1998 from $11.7
million for 1997. As a percentage of revenue, customer service costs amounted to
6.3% for 1998 and for 1997. The increase in the absolute amount was due
primarily to an increase in fees for billing services, partially offset by the
expenses incurred for the Fort Myers and GA-1 markets which approximated $1.1
million in 1997.

      General and administrative expenditures decreased 12.5% to $23.0 million
for 1998 from $26.3 million for 1997. General and administrative expenses
decreased as a percentage of total revenue to 10.5% in 1998 from 14.2% in 1997.
Payroll and its related fringe benefits were the largest line items that
reflected a decrease. General and administrative expenses attributable to the
cellular telephone systems sold in Fort Myers and GA-1 amounted to $1.8 million
in 1997. The Company continues to add subscribers which generate revenue.
Accordingly, general and administrative expenses should continue to decrease as
a percentage of total revenues. There can be no assurance, however, that this
forward-looking statement will not differ materially from actual results due to
unforeseen general and administrative expenses and other factors.

      Depreciation and amortization increased 19.1% to $43.6 million for 1998
from $36.6 million for 1997. This increase was primarily due to the additional
depreciation and amortization on higher fixed asset and intangible values from
the purchase of the Company in October 1997. As a percentage of revenue,
depreciation and amortization increased to 22.1% for 1998 from 19.7% for 1997
compared to 1997.


                                       20
<PAGE>

      Operating income increased 1.4% to $45.0 million in 1998, from $44.4
million for 1997. This improvement in operating results is primarily due to
increases in revenue and on cost containment. The improvement in operating
income was caused by a $7.0 million increase in the non-cash charges for
depreciation and amortization.

      Net interest expense increased to $77.5 million in 1998 from $46.7 million
in 1997 primarily because of the additional borrowings incurred as a result of
the acquisition and the push down of interest on Holdings indebtedness.

      The income tax benefit for 1998 amounted to $12.8 million representing the
reduction of the accrued tax liability associated with the sale of the Ft.
Meyers and GA-1 properties which was established as the result of purchase
accounting. The income tax benefit for 1997 approximated $1.0 million based on
the loss for the year.

      The net loss for the year ended December 31, 1998 was $47.2 million
compared to $2.8 million for the year ended December 31, 1997. The increased net
loss is a result of the additional interest expense, increased depreciation and
amortization expense and $25.3 million of extraordinary items (net of tax
benefit). These items are comprised of the write-off of deferred finance charges
and the premium associated with the early retirement of the Holdings notes and
interest paid for the early termination of the interest rate swap contracts.

Year Ended December 31, 1997 Compared To Year Ended December 31, 1996

      Revenue. Service revenues totaled $175.5 million for 1997, an increase of
16.1% over $151.1 million for 1996. This increase was due to a 29.8% increase in
the average number of subscribers to 313,042 for 1997 versus 241,255 for 1996.
The increase in subscribers is the result of internal growth, which the Company
attributes primarily to its strong sales and marketing efforts, and the recent
acquisitions. In addition to the subscriber base growth, service revenues also
increased because of a 35.3% increase in outcollect roaming revenues.

      Average monthly revenue per subscriber decreased 10.5% to $46.72 for 1997
from $52.20 for 1996. This is due to a common trend in the cellular telephone
industry, where on average, new customers use less airtime than existing
subscribers. Therefore, service revenues generally do not increase
proportionately with the increase in subscribers. In addition, the decline
reflects more competitive rate plans introduced into the Company's markets.

      Equipment sales and installation revenue, which consists primarily of
cellular subscriber equipment sales, increased to $10.0 million for 1997 from
$8.6 million for 1996. As a percentage of total cellular revenue, equipment
sales and installation revenue remained flat at 5.4% for both 1997 and 1996,
reflecting the increased recurring revenue base as well as lower cellular
equipment prices charged to customers.

      Operating Expenses. Engineering and technical expenses increased by 16.0%
to $14.6 million for 1997 from $12.6 million in 1996, due primarily to the
increase in subscribers and in cell site locations. As a percentage of revenue,
engineering and technical expenses remained flat at 7.9% for both 1997 and 1996.
This reflects the increased fixed costs associated with additional cell sites
constructed. As revenue grows the Company expects engineering and technical
expenses to decrease as a percentage of revenue due to its large component of
fixed costs. There can be no assurance, however, that this forward-looking
statement will not differ materially from actual results due to unforeseen
engineering and technical expenses.

      Other direct costs of services declined to $14.7 million for 1997 from
$16.1 million in 1996. As a percentage of revenue, other direct costs of service
decreased to 7.9% in 1997 from 10.1% in 1996, reflecting the decrease in
interconnection costs as a result of the Company's renegotiations of
interconnection agreements with the local exchange carriers ("LECs") in most of
the Company's markets, offset somewhat by more competitive roaming rates for
Company's customer roaming in adjacent areas.

      The cost of equipment increased 19.1% to $21.4 million for 1997 from $17.9
million for 1996, due primarily to the increase in gross subscriber activations.
Equipment sales resulted in losses of $11.4 million in 1997 versus $9.3 million
in 1996. The Company sells equipment below its costs in an effort to address
market competition and improve market share. The Company sold more telephones
below cost in 1997 than in 1996.

      Selling, general and administrative expenses increased 14.8% to $53.8
million in 1997 from $46.9 million in 1996. These expenses are comprised of (i)
sales and marketing costs, (ii) customer service costs and (iii) general and
administrative expenses.

      Sales and marketing costs increased 15.5% to $15.8 million for 1997 from
$13.7 million for 1996. This increase is primarily due to a 13.5% increase in
gross subscriber activations and the costs to acquire them and higher
advertising costs in response to market competition. As a percentage of total
revenue, sales and marketing costs decreased to 8.5% for 1997 compared to 8.6%


                                       21
<PAGE>

for 1996. The Company's cost to add a net subscriber, including loss on
telephone sales, increased to $469 for 1997 from $407 for 1996 due primarily to
increased losses from the Company's sales of cellular telephones and an increase
in commissions.

      Customer service costs increased 23.6% to $11.7 million for 1997 from $9.4
million for 1996. As a percentage of revenue, customer service costs increased
to 6.3% for 1997 from 5.9% for 1996. The increase was due primarily to an
increase in license and maintenance costs for the Company's billing systems.

      General and administrative expenditures increased 10.8% to $26.3 million
for 1997 from $23.8 million for 1996. General and administrative expenses
decreased as a percentage of total revenue to 14.2% in 1997 from 14.9% in 1996.
As the Company continues to add more subscribers, and generates associated
revenue, general and administrative expenses should continue to decrease as a
percentage of total revenues. There can be no assurance, however, that this
forward-looking statement will not differ materially from actual results due to
unforeseen general and administrative expenses and other factors.

      Depreciation and amortization increased 46.1% to $36.6 million for 1997
from $25.0 million for 1996. This increase was primarily due to the depreciation
and amortization associated with the new carrying value of assets as a result of
the "push down" of the purchase price to the Company, recent acquisitions and
additional capital expenditures. As a percentage of revenue, depreciation and
amortization increased to 19.7% from 15.7% for 1997 compared to 1996.

      Operating income increased 7.9% to $44.4 million in 1997, from $41.2
million for 1996. This improvement in operating results is attributable
primarily to increases in revenue, which exceeded increases in operating
expenses.

      Liquidity and Capital Resources

      The Company's long-term capital requirements consist of funds for capital
expenditures, acquisitions and debt service. Historically, the Company has met
its capital requirements primarily through the issuance of debt, equity
contributions, and, to a lesser extent, operating cash flow.

      In 1998 the Company spent approximately $14.7 million for capital
expenditures. The Company expects to spend approximately $16 million for capital
expenditures for the year ended December 31, 1999. The Company expects to use
net cash provided by operating activities to fund such capital expenditures.

      In July 1997, the Company issued $175 million of $11.75% Senior
Subordinated Notes due July 15, 2007 with interest payable semi-annually
commencing January 15, 1998. Such Notes contain covenants that restrict the
payment of dividends, incurrence of debt and sale of assets.

      In June 1998, the Company issued $525.0 million of 9.125% Senior Secured
Notes due December 15, 2006 with interest payable semi-annually commencing
December 15, 1998. These notes contain covenants that restrict the payment of
dividends, incurrence of debt and the sale of assets. The net proceeds from
these notes were used to pay-off the credit facility that approximated $425.1
million as of the redemption date.

      In August 1997, in connection with the acquisition of the Predecessor (see
Note 1 to the Company's Consolidated Financial Statements) Holdings issued
153,400 units, consisting of Holdings' Notes and Warrants of PCC, in exchange
for $80 million. The Notes accrete at a rate of 13.5% compounded semi-annually,
to an aggregate principal amount of approximately $153.4 million by August 1,
2002. In August 1998, the notes were redeemed at the redemption price per $1000
aggregate principal amount of $711.61. The accreted value of the notes
approximated $91.0 million. In addition, a premium of 20% of the outstanding
indebtedness or approximately $18.2 million was also paid. The redemption was
financed out of the net proceeds of a new Holdings offering of 11.25% Senior
Payable-in-Kind notes due 2008. Interest is payable semi-annually in arrears on
each February 15 and August 15. Cash interest will begin to accrue on the notes
on February 15, 2003 whereupon the interest rate will be reduced by 0.5%.
Commencing February 15, 1999, the Company may elect to pay cash interest
whereupon all future interest becomes cash pay and the interest rate will be
reduced by 0.5%

      Accounting Policies

      For financial reporting purposes, the Company reports 100% of revenues and
expenses for the markets for which its provides cellular telephone service.
However, in several of its markets, the Company holds less than 100% of the
equity 


                                       22
<PAGE>

ownership. The minority stockholders' and partners' share of income or losses in
those markets are reflected in the consolidated financial statements as
"minority interest share of (income) losses", except for losses in excess of
their capital accounts and cash call provisions which are not eliminated in
consolidation. For financial reporting purposes, the Company consolidates all
subsidiaries and partnerships since it has a controlling interest (greater than
50%) in each.

      Year 2000 Impact

      The Company is in the process of reviewing the full impact that the Year
2000 could have on its operational and financial systems. The Company has chosen
its current billing provider to coordinate the testing of all of the operating
and financial systems that could affect the Company's operations. Several of
these systems such as the point of sale system, the prepaid calling system, wide
area network and local area network, and the general ledger system are currently
integrated into the billing system.

      The Company's current billing vendor has committed to test the compliance
of the above systems with the Year 2000 requirements by reviewing the system's
upgrade releases which these third party providers maintain will be Year 2000
compliant. Most of these system providers deal with other cellular companies,
which enables the Company to leverage the knowledge obtained from servicing
other cellular and telecommunications companies. The Company anticipates that
this will reduce the testing and validation time necessary for a comprehensive
review.

      In addition to the testing of third party provided systems, the current
billing provider will review its own internal operating systems to verify Year
2000 compliance. They will then test the integration of the updated Year 2000
versions with their upgraded version to ensure compliance.

      The Company, with the billing provider's guidance, has formulated its
strategy after analyzing all systems that could have an effect on operations and
prioritizing the impact into high, medium, and low risk. The Company estimates
that the total costs of these testing and upgrading procedures will be less than
$2 million. However, the Company is unable to predict all of the implications of
the Year 2000 issue as it relates to its suppliers and other entities. It is
anticipated that the substantial portion of these costs will be incurred during
1999 and will be expensed when incurred.

      The Company has investigated the possibility of establishing a contingency
plan in the event the above is not successful. Its dependence on a few key third
party providers in the industry and the lack of accessibility of alternative
systems make a contingency plan impractical.

      Inflation

      The Company believes that inflation affects its business no more than it
generally affects other similar businesses.


                                       23
<PAGE>

Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

      Price Communications Wireless, Inc. and Subsidiaries Consolidated
Financial Statements are set forth on the following pages of this Part II.

                          INDEX TO FINANCIAL STATEMENTS

              PRICE COMMUNICATIONS WIRELESS, INC. AND SUBSIDIARIES

                        CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<S>                                                                                                                       <C>
Auditors' Reports.......................................................................................................  F-1
Consolidated Balance Sheets at December 31, 1998 and 1997...............................................................  F-3
Consolidated Statements of Operations for Years ended December 31, 1998, 1997 and 1996..................................  F-4
Consolidated Statements of Cash Flows for Years ended December 31, 1998, 1997 and 1996..................................  F-5
Consolidated Statements of Stockholder's Equity (Deficit) for Years ended December 31, 1998, 1997 and 1996..............  F-7
Notes to Consolidated Financial Statements..............................................................................  F-8
</TABLE>

Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURE

      Not Applicable.

                                    PART III

Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY

      Omitted pursuant to Instruction I 1 (a) and (b).

Item 11. EXECUTIVE COMPENSATION

      Omitted pursuant to Instruction I 1 (a) and (b).

Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

      Omitted pursuant to Instruction I 1 (a) and (b).

Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

      Omitted pursuant to Instruction I 1 (a) and (b).

                                     PART IV

Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

      (a) (1) and (2) List of financial statements and financial statement
schedules:

      Auditors' Reports
      Consolidated Balance Sheets at December 31, 1998 and 1997
      Consolidated Statements of Operations for the Years ended December 31,
        1998, 1997, and 1996. 
      Consolidated Statements of Cash Flows for the Years ended December 31, 
        1998, 1997 and 1996. 
      Consolidated Statements of Stockholder's Equity (Deficit) for the Years 
        ended December 31, 1998, 1997 and 1996.
      Notes to Consolidated Financial Statements.


                                       24
<PAGE>

      I.  Supplemental Schedule of Noncash Investing and Financing Activities.
      II. Supplemental Disclosure of Cash Flow Information.

      (Schedules other than those listed are omitted for the reason that they
are not required or are not applicable or the required information is shown in
the financial statements or notes thereto.)

      (3) Exhibits

      See Exhibit Index at page E-1, which is incorporated herein by reference.

      (b) Reports on Form 8-K.

      None.


                                       25
<PAGE>

                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To the Board of Directors and Shareholders of
Price Communications Wireless, Inc.:

      We have audited the accompanying consolidated balance sheets of Price
Communications Wireless, Inc. (a Delaware corporation, formerly Palmer Wireless,
Inc.) and subsidiaries as of December 31, 1998 and 1997, and the related
consolidated statements of operations, stockholder's equity and cash flows for
the year ended December 31, 1998 and the period May 29, 1997 through December
31, 1997 (post acquisition basis). We have also audited the accompanying
consolidated statements of operations, stockholder's equity, and cash flows for
the nine-month period ended September 30, 1997 (pre-acquisition basis). These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

      We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

      In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of Price Communications
Wireless, Inc. and subsidiaries as of December 31, 1998 and 1997 and the results
of their operations and their cash flows for the year ended December 31, 1998
and for the periods May 29, 1997 to December 31, 1997 (post-acquisition basis)
and January 1, 1997 to September 30, 1997 (pre-acquisition basis) in conformity
with generally accepted accounting principles.

                                                       /S/ ARTHUR ANDERSEN LLP

New York, New York
February 10, 1999


                                      F-1
<PAGE>

                          INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Shareholders of
Price Communications Wireless, Inc.:

      We have audited the accompanying consolidated statements of operations,
stockholder's equity and cash flows of Price Communications Wireless, Inc. and
subsidiaries (formerly Palmer Wireless, Inc.) for the year ended December 31,
1996. These consolidated financial statements are the responsibility of the
Company's management. Our responsibility is to express an opinion on these
consolidated financial statements based on our audit.

      We conducted our audit in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for our opinion.

      In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the results of operations and cash
flows of Price Communications Wireless, Inc. and subsidiaries for the year ended
December 31, 1996 in conformity with generally accepted accounting principles.


                                                       /s/ KPMG PEAT MARWICK LLP
                                                       -------------------------
                                                           KPMG Peat Marwick LLP

Des Moines, Iowa
January 30, 1997


                                      F-2
<PAGE>

              PRICE COMMUNICATIONS WIRELESS, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS
                                ($ in thousands)

<TABLE>
<CAPTION>
                                                                                  December 31,       December 31,
                                                                                      1998               1997
                                                                                      ----               ----
<S>                                                                               <C>                <C>        
                                     ASSETS
Current assets:
  Cash and cash equivalents ...............................................       $   109,137        $    27,926
  Restricted cash .........................................................            79,081                 --
  Trade accounts receivable, net of allowance for doubtful accounts
    of $1,596 in 1998 and $818 in 1997 ....................................            20,508             15,940
  Receivable from other cellular carriers .................................             2,282              3,902
  Prepaid expenses and deposits ...........................................               303                902
  Inventory ...............................................................             3,940              1,280
  Deferred income taxes ...................................................             5,402              1,383
                                                                                  -----------        -----------
    Total current assets ..................................................           216,634             55,352
Property and equipment:
  Land and improvements ...................................................             6,767              6,438
  Buildings and improvements ..............................................             8,831              8,561
  Equipment, communication systems, and furnishings .......................           140,381            153,550
                                                                                  -----------        -----------
                                                                                      169,148            155,380
  Less accumulated depreciation and amortization ..........................            24,320              4,239
                                                                                  -----------        -----------
    Net property and equipment ............................................           144,828            151,141
Licenses and goodwill, net of accumulated amortization of $29,117
    in 1998 and $6,016 in 1997 ............................................           876,952            918,488
Other intangible assets and other assets, at cost less accumulated
    amortization of $1,671 in 1998 and $818 in 1997 .......................            25,320             19,498
                                                                                  -----------        -----------

    Total assets ..........................................................       $ 1,263,734        $ 1,144,479
                                                                                  ===========        ===========

                 LIABILITIES AND STOCKHOLDER'S EQUITY (DEFICIT)

Current liabilities:
  Current installments of long-term debt ..................................       $        --        $     2,812
  Payable to Price Communications Corporation .............................             1,151              2,328
  Accounts payable ........................................................            13,168             13,059
  Accrued interest payable ................................................            11,779             11,361
  Accrued salaries and employee benefits ..................................             2,656              2,324
  Other accrued liabilities ...............................................             8,448             16,031
  Deferred revenue ........................................................             5,535              3,755
  Customer deposits .......................................................               921                602
                                                                                  -----------        -----------
    Total current liabilities .............................................            43,658             52,272
Long-term debt, excluding current installments ............................           700,000            610,188
Obligation of parent company ..............................................           209,432             80,112
Accrued income taxes--long term ...........................................            22,775             50,491
Deferred income taxes .....................................................           290,370            308,901
Minority interests ........................................................             9,530              7,352
Stockholder's equity
  Preferred stock par value $.01 per share; 10,000,000 shares
    authorized; none issued ...............................................                --                 --
  Class A Common Stock par value $.01 per share; 3,000 shares
    authorized, 1,500 shares issued .......................................                --                 --
  Additional paid-in capital ..............................................            44,015             44,015
  Retained earnings (accumulated deficit) .................................           (56,046)            (8,852)
                                                                                  -----------        -----------
    Total stockholder's equity (deficit) ..................................           (12,031)            35,163
                                                                                  -----------        -----------
    Total liabilities and stockholder's equity (deficit) ..................       $ 1,263,734        $ 1,144,479
                                                                                  ===========        ===========
</TABLE>

          See accompanying notes to consolidated financial statements.


                                      F-3
<PAGE>

              PRICE COMMUNICATIONS WIRELESS, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                ($ in thousands)

<TABLE>
<CAPTION>
                                                                    Company                       Predecessor
                                                                    -------                       -----------
                                                                        For the Period
                                                         For the Year    May 29, 1997     For the Nine     For the Year
                                                             Ended           through      Months Ended         Ended
                                                          December 31,    December 31,    September 30,     December 31,
                                                             1998            1997(a)          1997             1996
                                                             ----            -------          ----             ----
<S>                                                        <C>              <C>             <C>              <C>      
Revenue:
     Service .......................................       $ 184,652        $ 41,365        $ 134,123        $ 151,119
                                                               
     Equipment sales and installation ..............           2,348           7,613            8,624           12,677
                                                           ---------        --------        ---------        ---------
          Total revenue ............................         197,329          43,713          141,736          159,743
                                                           ---------        --------        ---------        ---------
Operating expenses:
     Engineering, technical and other direct .......          30,022           5,978           23,301           28,717
     Cost of equipment .............................          23,710           5,259           16,112           17,944
     Selling, general and administrative ...........          55,002          12,805           41,014           46,892

     Depreciation and amortization .................          43,569          11,055           25,498           25,013
                                                           ---------        --------        ---------        ---------
          Total operating expenses .................         152,303          35,097          105,925          118,566
          Operating income .........................          45,026           8,616           35,811           41,177
                                                           ---------        --------        ---------        ---------
Other income (expense):
     Interest income ...............................           5,435           2,195               30               62

     Interest expense ..............................         (82,945)        (24,393)         (24,497)         (31,524)
                                                           ---------        --------        ---------        ---------
          Interest expense, net ....................         (77,510)        (22,198)         (24,467)         (31,462)
     Other (expense) income, net ...................             (19)             15              208             (429)
                                                           ---------        --------        ---------        ---------
          Total other expense ......................         (77,529)        (22,183)         (24,259)         (31,891)
                                                           ---------        --------        ---------        ---------
          Income (loss) before minority interest
             share of income and income taxes ......         (32,503)        (13,567)          11,552            9,286
Minority interest share of income ..................          (2,178)           (414)          (1,310)          (1,880)
                                                           ---------        --------        ---------        ---------
          Income (loss) before income tax expense
             (benefit) .............................         (34,681)        (13,981)          10,242            7,406

Income tax benefit (expense) .......................          12,831           5,129           (4,153)          (2,724)
                                                           ---------        --------        ---------        ---------
          Income (loss) before extraordinary item ..         (21,850)         (8,852)           6,089            4,682
Extraordinary item - Loss on early extinguishment of
   debt (net of income tax benefit of $14,885) .....         (25,344)             --               --               --
                                                           ---------        --------        ---------        ---------
          Net income (loss) ........................       $ (47,194)       $ (8,852)       $   6,089        $   4,682
                                                           =========        ========        =========        =========
</TABLE>

(a)   Includes results of cellular operations only for the period October 1,
      1997 through December 31, 1997

          See accompanying notes to consolidated financial statements.


                                      F-4
<PAGE>

              PRICE COMMUNICATIONS WIRELESS, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                ($ in thousands)

<TABLE>
<CAPTION>
                                                                          Company                           Predecessor
                                                                          -------                           -----------
                                                                               For the Period     
                                                                For the         May 29, 1997      For the Nine         For the  
                                                              Year Ended           through        Months Ended        Year Ended
                                                              December 31,       December 31,     September 30,      December 31,
                                                                  1998               1997              1997              1996
                                                                  ----               ----              ----              ----
<S>                                                            <C>                <C>                <C>               <C>      
Cash flows from operating activities:
  Net income (loss) .......................................    $ (47,194)         $  (8,852)         $  6,089          $   4,682
                                                               ---------          ---------          --------          ---------
  Adjustments to reconcile net income (loss) to net cash                                                            
    provided by Operating activities:                                                                               
    Depreciation and amortization .........................       43,569             11,055            25,498             25,013
    Minority interest share of income .....................        2,178                414             1,310              1,880
    Deferred income taxes .................................         (373)            (2,454)            3,939              1,855
    Extraordinary item ....................................       40,229                 --                --                 --
    Interest deferred and added to long-term debt .........           --                 --                --                355
    Interest deferred and added to obligation of parent                                                             
      company .............................................        9,432              4,400                --                 --
    Payment of deferred interest ..........................           --                 --            (1,514)            (1,080)
    Amortization of deferred finance costs ................        2,030                 --                --                 --
    Changes in current assets and liabilities:                                                                      
      (Increase) decrease in trade and other accounts                                                               
        receivable ........................................       (2,948)               124               473             (1,561)
      (Increase) decrease in inventory ....................       (2,660)               458             2,800             (2,595)
      Increase (decrease) in accounts payable .............          109              3,598            (1,390)              (841)
      Increase (decrease) in accrued interest payable .....          418              9,394              (374)              (167)
      Increase (decrease) in accrued salaries and employee                                                          
        benefits ..........................................          332               (341)              251                165
      (Decrease) increase in other accrued liabilities ....       (4,605)            (4,529)            2,049               (507)
      Increase (decrease) in deferred revenue .............        1,780             (1,046)                4                912
      Increase (decrease) in customer deposits ............          319                 15               (94)               134
      (Decrease) in accrued income tax long term ..........      (27,716)            (2,675)               --                 --
      Other ...............................................          671                175              (250)             1,885
                                                               ---------          ---------          --------          ---------
      Total adjustments ...................................       62,765             20,165            32,702             25,448
                                                               ---------          ---------          --------          ---------
        Net cash provided by operating activities .........       15,571             11,313            38,791             30,130
                                                               ---------          ---------          --------          ---------
Cash flows from investing activities:                                                                               
  Capital expenditures ....................................      (14,725)           (14,499)          (40,757)           (41,445)
  Increase in other asset .................................           --                 --              (778)            (2,180)
  Proceeds from sales of property and equipment ...........           --                 --               201                  5
  Acquisition of Predecessor net assets ...................           --           (497,856)               --                 --
  Purchase of cellular systems ............................           --                 --           (31,469)           (67,588)
  Proceeds from sales of cellular systems .................           --            193,799                --                 --
  Collection of purchase price adjustment .................           --                 --                --              2,452
  Purchases of minority interests .........................           --               (794)             (956)            (1,854)
    Cash return of escrow .................................        2,000                 --                --                 --
                                                               ---------          ---------          --------          ---------
        Net cash used in investing activities .............      (12,725)          (321,030)          (73,759)          (110,610)

Cash flows from financing activities:                                                                               
  (Repayments to) advances from Price Communications                                                                
Corporation ...............................................       (1,177)             2,328                --                 --
  Increase (decrease) in short term notes payable .........           --                 --            (1,366)             1,366
  Repayment of long-term debt .............................     (518,112)          (385,000)           (3,782)          (108,319)
  Proceeds from long-term debt ............................      725,000            695,712            41,000            100,000
  Segregation of restricted cash from proceeds of                                                                 
    long-term debt ........................................      (79,081)                --                --                 --
  Costs associated with early extinguishment of debt ......      (28,080)                --                --                 --
  Payment of debt issuance costs ..........................      (20,185)           (19,412)               --                 --
  Public offering proceeds, net ...........................           --                 --                --             95,000
  Issuance of common stock ................................           --             44,015                --                 --
  Proceeds from stock options exercised ...................           --                 --               999                 95
  Payment of deferred offering costs ......................           --                 --                --               (826)
  Purchase of treasury stock ..............................           --                 --                --             (8,864)
  Proceeds from sales under stock purchase plans ..........           --                 --                --                290
                                                               ---------          ---------          --------          ---------
        Net cash provided by financing activities .........       78,365            337,643            36,851             78,742
                                                               ---------          ---------          --------          ---------
        Net increase (decrease) in cash and cash                                                                    
          equivalents .....................................       81,211             27,926             1,883             (1,738)
                                                                                                                    
Cash and cash equivalents at the beginning of period ......       27,926                 --             1,698              3,436
                                                               ---------          ---------          --------          ---------
Cash and cash equivalents at the end of period ............    $ 109,137          $  27,926          $  3,581          $   1,698
                                                               =========          =========          ========          =========
</TABLE>

          See accompanying notes to consolidated financial statements.


                                      F-5
<PAGE>

              PRICE COMMUNICATIONS WIRELESS, INC. AND SUBSIDIARIES

               CONSOLIDATED STATEMENTS OF CASH FLOWS--(Continued)
                                ($ in thousands)

       Supplemental Schedule of Noncash Investing and Financing Activities

      During 1996, the Predecessor increased the purchase obligations related to
the final purchase price adjustment for the controlling interest in a
non-wireline cellular telephone system purchased in 1991. This increase amounted
to $899 and resulted in an increase in licenses.

      Acquisitions of non-wireline cellular telephone systems in 1996 and 1997:

                                                      ($ in thousands)
                                                        Predecessor
                                                        -----------
                                                For the Nine   For the Year  
                                                Months Ended      Ended     
                                                September 30,  December 31, 
                                                     1997          1996      
                                                     ----          ----      
Cash payment ...............................       $31,469       $67,588
                                                   =======       =======
Allocated to:
     Fixed assets ..........................         3,197         5,678
     Licenses and goodwill .................        27,738        61,433
     Deferred income taxes .................            --            --
     Current assets and liabilities, net ...           534           477
                                                   -------       -------
                                                   $31,469       $67,588
                                                   =======       =======

                Supplemental disclosure of cash flow information

<TABLE>
<CAPTION>
                                                          ($ in thousands)
                                                                              
                                                Company                      Predecessor
                                                -------                      -----------
                                                      For the 
                                           For         period
                                        the Year       May 29,       For the Nine       For the 
                                          Ended      1997 through    Months Ended     Year Ended
                                       December 31,  December 31,    September 30,   December 31,
                                          1998           1997            1997            1996
                                          ----           ----            ----            ----
<S>                                     <C>            <C>                 <C>         <C>     
Income taxes paid (received), net       $    728       $    (40)           (736)       $  1,591
                                        ========       ========        ========        ========
Interest paid ...................       $ 81,379       $  9,924          25,102        $ 29,733
                                        ========       ========        ========        ========
</TABLE>

          See accompanying notes to consolidated financial statements.


                                      F-6
<PAGE>

              PRICE COMMUNICATIONS WIRELESS, INC. AND SUBSIDIARIES

                 CONSOLIDATED STATEMENTS OF STOCKHOLDER'S EQUITY
                                ($ in thousands)

                                   Predecessor

<TABLE>
<CAPTION>
                                                 Common Stock Class A        Common Stock Class B     Additional
                                                 --------------------        --------------------       Paid-in       Retained
                                                 Shares        Amount        Shares        Amount       Capital       Earnings
                                                 ------        ------        ------        ------       -------       --------
<S>                                              <C>             <C>        <C>              <C>        <C>            <C>    
Balances at December 31, 1995 ...........        6,095,772       $ 61       17,293,578       $173       $ 72,466       $ 1,853
Public offering, net of issuance costs of
   $5,826 ...............................        5,000,000         50               --         --         94,124            --
Exercise of stock options ...............            6,666         --               --         --             95            --
Employee and non-employee director
   stock purchase plans .................           17,243         --               --         --            290            --
Treasury shares purchased ...............               --         --               --         --             --            --
Net income ..............................               --         --               --         --             --         4,682
                                                ----------       ----       ----------       ----       --------       -------
Balances at December 31, 1996 ...........       11,119,681        111       17,293,578        173        166,975         6,535
Exercise of stock options ...............           70,000          1               --         --            998            --
Net income ..............................               --         --               --         --             --         6,089
                                                ----------       ----       ----------       ----       --------       -------
Balances at September 30, 1997 ..........       11,189,681       $112       17,293,578       $173       $167,973       $12,624
                                                ==========       ====       ==========       ====       ========       =======
</TABLE>

<TABLE>
<CAPTION>
                                                                    Treasury Stock            Total
                                                                    --------------         Stockholders'
                                                                 Shares        Amount         Equity
                                                                 ------        ------         ------
<S>                                                              <C>           <C>            <C>      
Balances at December 31, 1995 ............................            --            --        $  74,553
Public offering, net of issuance costs of $5,826 .........            --            --           94,174
Exercise of stock options ................................            --            --               95
Employee and non-employee director stock purchase plans ..            --            --              290
Treasury shares purchased ................................       600,000        (8,864)          (8,864)
Net income ...............................................            --            --            4,682
                                                                 -------       -------        ---------
Balances at December 31, 1996 ............................       600,000        (8,864)         164,930
Exercise of stock options ................................            --            --              999
Net income ...............................................            --            --            6,089
                                                                 -------       -------        ---------
Balances at September 30, 1997 ...........................       600,000       $(8,864)       $ 172,018
                                                                 =======       =======        =========
</TABLE>

                                     COMPANY

<TABLE>
<CAPTION>
                                            Common Stock
                                              Class A             Additional                        Total
                                              -------               Paid-in       Accumulated    Stockholder's
                                     Shares          Amount         Capital         Deficit     Equity (Deficit)
                                     ------          ------         -------         -------     ----------------
<S>                                    <C>          <C>            <C>             <C>             <C>      
Balances at May 29, 1997 ....             --        $     --       $     --        $     --        $     --
Capital contribution ........          1,500              --         44,015              --          44,015
Net loss ....................             --                                         (8,852)         (8,852)
                                    --------        --------       --------        --------        --------
Balances at December 31, 1997          1,500              --         44,015          (8,852)         35,163
Net Loss ....................             --              --             --         (47,194)        (47,194)
                                    --------        --------       --------        --------        --------
Balances at December 31, 1998          1,500        $     --       $ 44,015        $(56,046)       $(12,031)
                                    --------        --------       --------        --------        --------
</TABLE>

          See accompanying notes to consolidated financial statements.


                                      F-7
<PAGE>

              PRICE COMMUNICATIONS WIRELESS, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1) Summary of Significant Accounting Policies

      Organization and Acquisition

      Price Communications Wireless, Inc. ("PCW" or the "Company"), a
wholly-owned subsidiary of Price Communications Cellular Holdings, Inc.
("Holdings"), a wholly-owned subsidiary of Price Communications Cellular, Inc.,
a wholly-owned subsidiary of Price Communications Corporation ("PCC"), was
incorporated on May 29, 1997 in connection with the purchase of Palmer Wireless,
Inc. and subsidiaries ("Palmer" or the "Predecessor").

      In May 1997, PCC, PCW and Palmer entered into an Agreement and Plan of
Merger (the "Merger Agreement"). The Merger Agreement provided, among other
things, for the merger of PCW with and into Palmer with Palmer as the surviving
corporation (the "Merger"). In October, 1997, the Merger was consummated and
Palmer changed its name to "Price Communications Wireless, Inc." Pursuant to the
Merger Agreement, PCC acquired each issued and outstanding share of common stock
of Palmer for a purchase price of $17.50 per share in cash and purchased
outstanding options and rights under employee and direct stock purchase plans
for an aggregate price of approximately $486.4 million. In addition, as a result
of the Merger, PCW assumed all outstanding indebtedness of Palmer of
approximately $378.0 million. Therefore, the aggregate purchase price for Palmer
(including transaction fees and expenses) was approximately $880.0 million. PCW
refinanced all of the Palmer Existing Indebtedness concurrently with the
consummation of the Merger.

      In June 1997, PCW entered into an agreement to sell Palmer's Fort Myers,
Florida MSA as part of the financing of the Merger (the "Fort Myers Sale"). In
October 1997, the Fort Myers Sale was consummated, and generated proceeds to the
Company of approximately $166.0 million. The proceeds of the Fort Myers Sale
were used to fund a portion of the acquisition of Palmer. Accordingly, no gain
or loss was recognized on the Fort Myers Sale.

      Also in connection with the Merger, on October 21, 1997, PCC and PCW
entered into an Asset Purchase Agreement with MJ Cellular Company, L.L.C. which
provided for the sale by PCW of substantially all of the assets used in the
operation of the non-wireline cellular telephone system serving the
Georgia-1-Whitfield Rural Service Area ("Georgia-1"), including the FCC licenses
to operate Georgia-1 (the "Georgia Sale"). The sale of the assets of Georgia-1
was consummated on December 30, 1997 for $24.2 million. In January 1998 the
proceeds from the Georgia Sale were used to retire a portion of the debt used to
fund the Palmer acquisition. Accordingly, no gain or loss was recognized on the
Georgia Sale.

      In order to fund the Merger and pay related fees and expenses, in July,
1997, PCW issued $175.0 million aggregate principal amount of 11 3/4% Senior
Subordinated Notes due 2007 and entered into a syndicated senior loan facility
providing for term loan borrowings in the aggregate principal amount of
approximately $325.0 million and revolving loan borrowings of $200.0 million. In
October 1997, PCW borrowed all term loans available thereunder and approximately
$120.0 million of revolving loans. DLJ Capital Funding, Inc. provided and
syndicated the New Credit Facility.

      The remaining acquisition price of Palmer was funded through a $44.0
million equity contribution of PCC and $75.7 million of borrowings of Holdings.

      Basis of Presentation

      For financial reporting purposes, PCW revalued its assets and liabilities
as of October 1, 1997 to reflect the price paid by PCC to acquire 100% of its
Common Stock, a process generally referred to as "push down" the accounting. As
of December 31, 1997 the consolidated financial statements reflect an allocation
of the purchase price to the assets acquired and liabilities assumed including
$12.5 million of purchase reserves .The allocation of the purchase price
resulted in licenses of approximately $924.5 million on the balance sheet, which
are being amortized on a straight-line basis over a period of 40 years. During
1998, approximately $2.3 million of unused purchase reserves were reversed
against the value of the licenses established at the end of 1997.


                                      F-8
<PAGE>

              PRICE COMMUNICATIONS WIRELESS, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

      The consolidated financial statements through September 30, 1997 reflect
the historical cost of Palmer's assets and liabilities and results of operations
and are referred to as the "Predecessor" consolidated financial statements.
Accordingly, the accompanying financial statements of the Predecessor and the
Company are not comparable in all material respects since those financial
statements report financial position, results of operations, and cash flows of
these two separate entities.

      Consolidation

      The accompanying consolidated financial statements include the accounts of
the Company and its subsidiaries after the elimination of significant
intercompany accounts and transactions. The financial statements also include
the cash (Restricted cash) and debt of Holdings, (Obligation of parent company)
which funded a portion of the acquisition of Palmer and is indirectly guaranteed
by the assets of the Company.

      The Predecessor was a Delaware corporation and was incorporated on
December 15, 1993 to effect an initial public offering of its Class A Common
Stock. At December 31, 1996, Palmer Communications Incorporated ("PCI") owned 61
percent of the Predecessor's outstanding stock and had 75 percent of its voting
rights and therefore the Predecessor was a subsidiary of PCI.

      Losses in subsidiaries, attributable to minority stockholders and
partners, in excess of their capital accounts and cash capital call provisions
are not eliminated in consolidation.

      Operations

      The Company has majority ownership in corporations and partnerships which
operate the non-wireline cellular telephone systems in eight Metropolitan
Statistical Areas ("MSA") in three states: Florida (one), Georgia (five) and
Alabama (two). The Company's ownership percentages in these entities range from
approximately 78 percent to 100 percent. The Company owns directly and operates
eight non-wireline cellular telephone systems in Rural Service Areas in Georgia
(seven) and Alabama (one).

The Predecessor had majority ownership in corporations and partnerships, which
operated the non-wireline cellular telephone systems in nine MSAs in three
states: Florida (two), Georgia (five) and Alabama (two). The Predecessor's
ownership percentages in these entities ranged from approximately 78 percent to
100 percent. The Predecessor owned directly and operated eight non-whirling
cellular telephone systems in RSAs in Georgia (seven) and Alabama (one).

      Use of Estimates

      The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from these estimates.

      Cash and Cash Equivalents

      The Company and the Predecessor consider cash and repurchase agreements
with a maturity of three months or less to be cash equivalents.

      Inventory

      Inventory consisting primarily of cellular telephones and telephone parts
is stated at the lower of cost or market. Cost is determined using the first-in,
first-out (FIFO) method.


                                      F-9
<PAGE>

              PRICE COMMUNICATIONS WIRELESS, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

      Property and Equipment

      Property and equipment are stated at cost. The cost of additions and
improvements are capitalized while maintenance and repairs are charged to
expense when incurred. Depreciation is provided principally by the straight-line
method over the estimated useful lives, ranging from 5 to 20 years for buildings
and improvements and 5 to 10 years for equipment, communications systems and
furnishings.

      Acquisitions and Licenses

      The cost of acquired companies is allocated first to the identifiable
assets, including licenses, based on the fair market value of such assets at the
date of acquisition (as determined by independent appraisers or management). The
excess of the total consideration over the amounts assigned to identifiable
assets is record as goodwill. Licenses and goodwill are being amortized on a
straight-line basis over a 40-year period.

      Subsequent to the acquisition of the licenses, the Company continually
evaluates whether later events and circumstances have occurred that indicate the
remaining estimated useful life of licenses might warrant revision or that the
remaining balance of the license rights may not be recoverable. The Company
utilizes projected undiscounted cash flows over the remaining life of the
licenses and sales of comparable businesses to evaluate the recorded value of
licenses. The assessment of the recoverability of the remaining balance of the
license rights will be impacted if projected cash flows are not achieved.

      Other Intangible Assets

      Other intangibles consist principally of deferred financing costs and
other items. These costs are being amortized by the interest or straight-line
method over their respective useful lives, which range from 5 to 10 years.

      Income Taxes

      The Company and the Predecessor account for income taxes under the asset
and liability method of accounting for deferred income taxes. Under the asset
and liability method, deferred tax assets and liabilities are recognized for the
future tax consequences attributable to differences between the financial
statement carrying amounts of existing assets and liabilities and their
respective tax bases and operating loss carryforwards. Deferred tax assets and
liabilities are measured using enacted tax rates expected to apply to taxable
income in the years in which those temporary differences are expected to be
recovered or settled. The effect on deferred tax assets and liabilities of a
change in tax rates is recognized in income in the period that includes the
enactment date.

      Interest Rate Swap Agreements

      The differential to be paid or received in connection with interest rate
swap agreements is accrued as interest rates change and is recognized over the
life of the agreements.

      Revenue Recognition

      Service revenue includes local subscriber revenue and outcollect roaming
revenue.


                                      F-10
<PAGE>

              PRICE COMMUNICATIONS WIRELESS, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

      Local subscriber revenue is earned by providing access to the cellular
network ("access revenue") or, as applicable, for usage of the cellular network
("airtime revenue"). Access revenue is billed one month in advance and is
recognized when earned. Airtime revenue is recognized when the service is
rendered.

      Outcollect roaming revenue represents revenue earned for usage of its
cellular network by subscribers of other cellular carriers. Outcollect roaming
revenue is recognized when the services are rendered.

      Equipment sales and installation revenues are recognized upon delivery to
the customer or installation of the equipment.

      Operating Expenses--Engineering, Technical and Other Direct

      Engineering, technical and other direct operating expenses represent
certain costs of providing cellular telephone service to customers. These costs
include incollect roaming expense. Incollect roaming expense is the result of
subscribers using cellular networks of other cellular carriers. Incollect
roaming revenue is netted against the incollect roaming expense to determine net
incollect roaming expense.

      Fair Value of Financial Instruments

      Fair value estimates, methods and assumptions used to estimate the fair
value of financial instruments are set forth below:

      For cash and cash equivalents, trade accounts receivable, receivable from
other cellular carriers, notes payable, accounts payable and accrued expenses,
the carrying amount approximates the estimated fair value due to the short-term
nature of those instruments.

      Rates currently available for long-term debt with similar terms and
remaining maturities are used to discount the future cash flows to estimate the
fair value for long-term debt. Note 5 presents the fair value for long-term debt
and the related interest rate cap and swap agreements.

      Fair value estimates are made as of a specific point in time, based upon
the relevant market information about the financial instruments. Because no
market exists for a majority of the financial instruments, fair value estimates
are based on judgments regarding current economic conditions and other factors.
These estimates are subjective in nature and involve uncertainties and matters
of judgment and, therefore, cannot be determined with precision. Changes in
assumptions could significantly affect the estimates.

      Stock Option Plans

      The Predecessor accounted for its stock option plans in accordance with
the provisions of Accounting Principles Board ("APB") Opinion No. 25, Accounting
for Stock Issued to Employees, and related interpretations. As such,
compensation expense would be recorded on the date of grant only if the current
market price of the underlying stock exceeded the exercise price. On January 1,
1996, the Predecessor adopted Statement of Financial Accounting Standards
("SFAS") No. 123, Accounting for Stock-Based Compensation, which permits
entities to recognize as expense over the vesting period the fair value of all
stock-based awards on the date of grant. Alternatively, SFAS No. 123 also allows
entities to continue to apply the provisions of APB Opinion No. 25 and provide
pro forma net income and pro forma earnings per share disclosures for employee
stock option grants made in 1995 and future years as if the fair-value-based
method defined in SFAS No. 123 had been applied. The Predecessor elected to
continue to apply the provisions of APB Opinion No. 25 and provide the pro forma
disclosure provisions of SFAS No. 123.

(2) Trade Accounts Receivable

      The Company and the Predecessor grant credit to its customers.
Substantially all of the customers are residents of the local areas served.
Generally, service is discontinued to customers whose accounts are 60 days past
due.


                                      F-11
<PAGE>

              PRICE COMMUNICATIONS WIRELESS, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

      The activity in the Predecessor's and the Company's allowance for doubtful
accounts for the years ended December 31, 1996, the nine months ended September
30, 1997 the period from May 29, 1997 through December 31, 1997 and for the year
ended December 31, 1998 consisted of the following:

<TABLE>
<CAPTION>
                                                                              Allowances at                                 
                                                  Balance at       Charged       Dates of      Deductions,                  
                                                  Beginning          To        Acquisitions       Net of      Balance at     
                                                  of Period       Expenses    (Dispositions)   Recoveries    End of Period  
                                                  ---------       --------    --------------   ----------    -------------  
<S>                                                <C>            <C>            <C>            <C>             <C>     
Predecessor
     Year ended December 31, 1996 ..........       $  1,880       $  3,946       $  1,270       $ (5,305)       $  1,791
                                                   ========       ========       ========       ========        ========
Predecessor
     Nine months ended September 30, 1997 ..       $  1,791       $  3,614       $    147       $ (4,212)       $  1,340
                                                   ========       ========       ========       ========        ========
Company
     Period from May 29, 1997 through
        through December 31, 1997 ..........       $  1,340       $  1,202       $   (206)      $ (1,518)       $    818
                                                   ========       ========       ========       ========        ========
     Year Ended December 31, 1998 ..........       $    818       $  5,716       $     --       $ (4,938)       $  1,596
                                                   ========       ========       ========       ========        ========
</TABLE>

(3) Other Accrued Liabilities

      Other accrued liabilities at December 31, 1998 and 1997 consisted of the
      following:

                                                     1998          1997
                                                     ----          ----
Accrued telecommunications expenses ........       $ 1,861       $ 2,176
Accrued local taxes ........................         1,368           888
Accrued severance payments .................            --         6,155
Accrued shutdown costs of
certain facilities .........................            --         3,818
Other ......................................         5,219         2,994
                                                   -------       -------
                                                   $ 8,448       $16,031
                                                   =======       =======

(4) Acquisitions and Purchase of Licenses

      On June 20, 1996, the Predecessor acquired the assets of and the license
to operate the non-wireline cellular telephone system serving the Georgia-1 RSA
for an aggregate purchase price of $31.6 million. The acquisition was accounted
for by the purchase method of accounting. In connection with the acquisition,
$27.9 million of the purchase price was allocated to licenses.

      On July 5, 1996, two of the Predecessor's majority-owned subsidiaries
acquired the assets of and the license to operate the non-wireline cellular
telephone system serving the Georgia-6 RSA for an aggregate purchase price of
$36.0 million. The acquisition was accounted for by the purchase method of
accounting. In connection with the acquisition, $33.5 million of the purchase
price was allocated to licenses.


                                      F-12
<PAGE>

              PRICE COMMUNICATIONS WIRELESS, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

      On January 31, 1997, a majority-owned subsidiary of the Predecessor
acquired the assets of and the license to operate the non-wireline cellular
telephone system serving the Georgia-13 RSA for an aggregate purchase price of
$31.5. The acquisition was accounted for by the purchase method of accounting.
In connection with the acquisition, $27.7 of the purchase price was allocated to
licenses.

(5) Pro Forma Information

      The following unaudited pro forma condensed consolidated financial
information was prepared assuming (i) the Predecessor was acquired on January 1,
1996, (ii) the acquisitions of the licenses had occurred on January 1, 1996 (See
Note 4) and (iii) the Ft. Myers Sale and Georgia Sale occurred on January 1,
1996.

      Proforma information is presented for comparative purposes only and does
not purport to be indicative of the results which would have been achieved had
this acquisition occurred as of January 1, 1996, nor does it purport to be
indicative of results that may be achieved in the future.

                                                      Year Ended December 31
                                                     1997                1996
                                                     ----                ----
                                                         ($ in thousands)
                                                            Unaudited
Total Revenue ..........................          $ 161,468           $ 145,643
                                                  =========           =========
Loss Before Income Taxes ...............          $ (51,532)          $ (54,529)
                                                  =========           =========
Net Loss ...............................          $ (43,911)          $ (48,895)
                                                  =========           =========

(6) Notes Payable and Long-Term Debt

      Long-term debt consists of the following:

                                                         December 31
                                                       ($ in thousands)
                                                     1998            1997
                                                     ----            ----
Credit agreement ................................  $     --        $438,000(a)
11.75% Senior Subordinated Notes ................   175,000(b)      175,000(b)
9.125% Senior Secured Notes .....................   525,000(c)           --
                                                   --------        --------
                                                                    613,000
Less current installments .......................        --           2,812
                                                                   --------
Long-term debt, excluding current installments...  $700,000        $610,188
                                                   ========        ========
                                               
(a)   In October 1997, the Company entered into a credit agreement ("Credit
      Agreement") with a syndicate of banks, financial institutions and other
      "accredited investors" providing for loans of up to $525.0 million. The
      Credit Agreement included a $325.0 million term loan facility and a $200.0
      million revolving credit facility. The term loan facility was comprised of
      tranche A loans of up to $100.0 million, which were to mature on September
      30, 2005, and tranche B term loans of up to $225.0 million, which were to
      mature on September 30, 2006. The Credit Agreement bears interest at the
      alternate base rate, as defined in the Credit Agreement, as the reserve
      adjusted Euro-Dollar rate plus, in each case, applicable margins of (i) in
      the case of tranche A term loans and revolving loans (x) 2.5% for
      Euro-Dollar rate loans and (y) 1.5% for base rate loans and (ii) in the
      case of tranche B term loans (x) 2.75 for Euro-Dollar rate loans and (y)
      1.75% for base rate loans.

      The Company entered into interest rate swap and cap agreements to reduce
      the impact of changes in interest rates on its floating rate debt. At
      December 31, 1997, the Company had outstanding seven interest rate swap
      agreements and one interest rate cap agreement having a total notional
      value of $370.0 million. All interest rate swap contracts were liquidated
      as of December 31, 1998. Included as an extraordinary item is
      approximately $3.7 million (net of taxes) of additional expense relating
      to the liquidation of these contracts.


                                      F-13
<PAGE>

              PRICE COMMUNICATIONS WIRELESS, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(b)   In July 1997, the Company issued $175.0 million of 11.75% Senior
      Subordinated Notes ("11.75% Notes") due July 15, 2007 with interest
      payable semi-annually commencing January 15, 1998. The 11.75% Notes
      contain covenants that restrict the payment of dividends, incurrence of
      debt and sale of assets. The fair market value of the 11.75% Notes
      approximated $166.3 million as of December 31, 1998.

(c)   In June 1998, the Company issued $525.0 million of 9.125% Senior Secured
      Notes due December 15, 2006 with interest payable semi-annually commencing
      December 15,1998. The 9.125% notes contain covenants that restrict the
      payment of dividends, incurrence of debt and sale of assets. The net
      proceeds of the notes were used to retire the outstanding indebtedness
      under the credit facility. The fair market value of the notes approximated
      $535.5 million as of December 31, 1998.

(7) Obligation of Parent Company

            In August 1997, Holdings issued 153,400 units, consisting of Notes
      and warrants of PCC (the "Warrants"), in exchange for $80.0 million. The
      Notes accrete at a rate of 13.5%, compounded semi-annually, to an
      aggregate principal amount of approximately $153.4 million by August 1,
      2002. Cash interest will not commence to accrue on the Notes prior to
      August 2, 2002. Commencing on February 1, 2003, cash interest on the Notes
      will be payable at a rate of 13.5% per annum, payable semi-annually. The
      Notes will be redeemable at the option of Holdings, in whole or in part,
      at any time after August 1, 1998 in cash at the redemption price as
      defined, plus accrued and unpaid interest, if any, thereon to the
      redemption date; provided that the trading price of the common stock of
      PCC shall equal or exceed certain levels.

            In August 1998, Holdings redeemed all its outstanding 13.5% Senior
      Secured Discount Notes due 2007 (the "13.5% Notes"). The notes were
      redeemed at the redemption price per $1,000 aggregate principal amount of
      $711.61. The accreted value of the notes approximated $91.0 million. In
      addition, Holdings was required to pay a premium of approximately 20% of
      the outstanding balance or approximately $18.2 million. The Company
      financed the redemption out of the proceeds of a new $200.0 million
      Holdings offering of 11.25% Senior Exchangeable Payable-in-Kind Notes
      ("the Payable-in-Kind Notes") due 2008. Cash interest will begin to accrue
      on the Payable-in-Kind Notes on February 15, 2003 whereupon the interest
      rate will be reduced by 0.5%. Commencing February 15, 1999 Holdings may
      elect to pay cash interest whereupon all future interest becomes cash pay
      and the interest rate would be reduced by 0.5%. In the event the daily
      high price of PCC's common stock equals or exceeds 115.0% of the Exchange
      Price for 10 out of 15 consecutive trading days, each outstanding note
      will be mandatorily exchanged for shares of PCC common stock, par value
      $.01 per share on the fifth trading day immediately succeeding such 10th
      trading day (unless Holdings elects on or prior to the second trading day
      immediately succeeding such 10th trading day to permanently terminate this
      mandatory provision). The current exchange price is $16 per share after
      giving effect to the 2 for 1 stock split in September 1998 and the 5 for 4
      stock split in January 1999. The accompanying Balance Sheet includes $79.1
      million of restricted cash which is reflected on the Company's balance
      sheet. The Company has no rights with respect to such cash.

            The accompanying Balance Sheets includes $209.4 million and $80.1
      million at December 31, 1998 and 1997 respectively (including accrued
      interest) of the 11.25% notes and the 13.5% notes which are obligations of
      Holdings and are included in the Balance Sheets solely pursuant to "push
      down" accounting rules. The carrying value approximates fair value as of
      December 31, 1998.

(8) Extraordinary Item

            In June and August 1998, the Company and Holdings retired the
      outstanding indebtedness under its Credit Facility and the 13 1/2% Notes.
      The additional costs incurred to retire the Credit Facility and the 13
      1/2% Notes, as well as the write off of deferred financing costs
      associated with these financings resulted in an extraordinary loss of
      $25.3 million net of a tax benefit of $14.9 million.


                                      F-14
<PAGE>

              PRICE COMMUNICATIONS WIRELESS, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(9) Income Taxes

      Components of income tax expense (benefit) consist of the following:

                                                   ($ in thousands)
                                          Federal        State         Total
                                          -------        -----         -----
Predecessor:
     Year ended December 31, 1996:
          Current ..................     $     --      $    869      $    869
          Deferred .................        1,795            60         1,855
                                         --------      --------      --------
                                         $  1,795      $    929      $  2,724
                                         ========      ========      ========
Predecessor:
     Period ended September 30, 1997
          Current ..................     $     --      $    214      $    214
          Deferred .................        3,553           386         3,939
                                         --------      --------      --------
                                         $  3,553      $    600      $  4,153
                                         ========      ========      ========
Company:
     Year ended December 31, 1997
          Current ..................     $ (2,244)     $   (432)     $ (2,676)
          Deferred .................       (2,116)         (337)       (2,453)
                                         --------      --------      --------
                                         $ (4,360)     $   (769)     $ (5,129)
                                         ========      ========      ========
Company:
     Year ended December 31, 1998
          Current ..................     $ (3,355)     $   (531)     $ (3,886)
          Deferred .................       (7,713)       (1,232)       (8,945)
                                         --------      --------      --------
                                         $(11,068)     $ (1,763)     $(12,831)
                                         ========      ========      ========

      The consolidated effective tax rate differs from the statutory United
States federal tax rate for the following reasons and by the following
percentages:

<TABLE>
<CAPTION>
                                                             Company                      Predecessor
                                                             -------                      -----------
                                                                     Period       Nine Months
                                                   Year Ended         Ended          Ended        Year Ended
                                                   December 31,    December 31,   September 30,   December 31,
                                                      1998            1997            1997           1996
                                                     ------          ------          ------         ------
<S>                                                   <C>             <C>              <C>            <C>  
Statutory United States federal tax rate .......      (34.0)%         (34.0)%          34.0%          34.0%
License amortization not deductible for tax ....         --              --              --           32.5
Net operating loss carryforwards ...............         --              --              --          (42.8)
State taxes ....................................       (3.6)           (3.6)            6.0            8.3
Non deductible interest expense ................         --             1.1              --             --
Other ..........................................         .6            (0.2)            1.0            4.8
                                                     ------          ------          ------         ------
     Consolidated effective tax rate ...........      (37.0)%         (36.7)%          41.0%          36.8%
                                                     ======          ======          ======         ======
</TABLE>


                                      F-15
<PAGE>

              PRICE COMMUNICATIONS WIRELESS, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

      In 1997, the Predecessor recorded additional deferred tax liability and a
corresponding increase in licenses for timing differences attributable to
pre-1997 acquisitions. The components of the deferred income tax assets and
liabilities are as follows:

                                                      ($ in thousands)
                                                    1998           1997
                                                    ----           ----

Deferred tax assets:
     Allowance for doubtful accounts .......     $     591      $     327
     Inventory reserve .....................           133            144
     Deferred revenue ......................            --            400
     Nondeductible accruals ................         4,149          6.495
     Net operating loss carryforwards ......        29,320          3,560
     Valuation allowance ...................       (29,320)        (3,560)
                                                 ---------      ---------
          Total deferred tax assets ........         4,873          7,366
                                                 ---------      ---------
Deferred tax liabilities:
     Accumulated depreciation ..............       (12,808)        (8,559)
     Licenses ..............................      (281,052)      (302,306)
                                                 ---------      ---------
          Total deferred tax liabilities ...      (293,860)      (310,865)
                                                 ---------      ---------
          Deferred tax liability, net ......     $(288,987)     $(303,499)
                                                 =========      =========

      The net operating loss carryforwards totaled approximately $79.0 million
at December 31, 1998 and expire in amounts ranging from approximately $300,000
to $70.0 million through 2013. For these carryforwards utilization is limited to
the subsidiary that generated the carryforwards, unless the Company utilizes
alternative tax planning strategies.

(10) Common Stock and Stock Plans

      During 1994, the Predecessor amended its certificate of incorporation to
increase the number of authorized shares of common stock from 60,000,000 to
91,000,000 and to provide for Class A Common and Class B Common Stock. The Class
A Common Stock has one vote per share. The Class B Common Stock, which may be
owned only by PCI or certain successors of PCI and of which no shares may be
issued subsequent to the Offering, has five votes per share, provided, however,
that, so long as any Class A Common Stock is issued and outstanding, at no time
will the total outstanding Class B Common Stock have the right to cast votes
having more than 75 percent of the total voting power of the common stock in the
aggregate. Shares of Class B Common Stock shall be converted into Class A Common
Stock on a share-for share basis: (i) at any time at the option of the holder;
(ii) immediately upon the transfer of shares of Class B Common Stock to any
holder other than a successor of PCI; (iii) immediately if the shares of Class B
Common Stock held by PCI or its successors constitute 33 percent or less of the
outstanding shares of the Predecessor; (iv) at the end of 20 years from original
issuance of those shares of Class B Common Stock; or (v) if more than 50 percent
of the equity interests in PCI become beneficially owned by persons other than:
(i) beneficial owners of PCI as of December 29, 1994 ("Current PCI Beneficial
Owners"); (ii) affiliates of Current PCI Beneficial Owners; (iii) heirs or
devisees of any individual Current PCI Beneficial Owners, successors of any
corporation or partnership which is a Current PCI Beneficial Owner and
beneficiaries of any trust which is a Current PCI Beneficial Owner; and (iv) any
relative, spouse or relative of a spouse of any Current PCI Beneficial Owner.

      The Predecessor adopted a Stock Option Plan in connection with the
Offering, under which options for an aggregate of 1,600,000 shares of Class A
Common Stock are available for grants to key employees. The Predecessor also
adopted a Director's Stock Option Plan in connection with the Offering, under
which options for an aggregate of 300,000 shares of Class A Common Stock are
available for grants to directors who are not officers or employees of the
Predecessor. Stock options under both plans are granted with an exercise price
equal to the stock's fair value at the date of grant. The stock options granted
under the Stock Option Plan have 10-year terms and vest and become exercisable
ratably over three years from the date of grant. The stock options granted under
the Director's Stock Option Plan are vested and become fully exercisable upon
the date of the grant. At December 31, 1996, there were options with respect to
693,334 and 45,000 shares of Class A Common Stock outstanding under the Stock
Option Plan and the Director's Stock Option Plan, respectively. At December 31,
1996, there were 880,000 and 255,000 additional shares available for grant under
the Stock Option Plan and the Director's Stock Option Plan, respectively.


                                      F-16
<PAGE>

              PRICE COMMUNICATIONS WIRELESS, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

      The Predecessor applies APB Opinion No. 25 in accounting for its Stock
Option Plan and Director's Stock Option Plan ("the Plans") and accordingly, no
compensation cost has been recognized for its stock options in the consolidated
financial statements. Had the Predecessor determined compensation cost based on
the fair value at the grant date for its stock options under SFAS No. 123, the
Predecessor's net income would have been reduced to the pro forma amounts
indicated below:

                                                        ($ in thousands)
                                                 Nine Months
                                                    Ended            Year Ended
                                                 September 30,      December 31,
                                                     1997               1996
                                                    ------             ------
Net income-as reported ...................          $6,089             $4,682
Net income-pro forma .....................          $4,753             $2,850

      The fair value of each option grant is estimated on the date of grant
using the Black-Scholes option pricing model with the weighted-average
assumptions as follows: dividend yield of 0.0%; expected volatility of 101%;
risk-free interest rate of 5.5%; and expected lives of five years.

      Stock option activity during the periods indicated is as follows:

                                                                  ($'s Actual)
                                                     Number     Weighted Average
                                                    Of Shares    Exercise Price
                                                    ---------    --------------
Balance December 31, 1995 .......................    672,500        $  14.25
     Granted ....................................     72,500           17.25
     Exercised ..................................     (6,666)          14.25
                                                    --------        
Balance December 31, 1996 .......................    738,334           14.54
     Exercised ..................................    (70,000)          14.25
                                                    --------        
Balance September 30, 1997 ......................    668,334           14.60
                                                    ======== 

      At December 31, 1996, the range of exercise prices and weighted-average
remaining contractual life of outstanding options was $14.25--$17.25 ($'s not in
thousands) and 8.3 years, respectively.

      At December 31, 1996, the number of options exercisable was 250,000, and
the weighted average exercise price of those options was $14.34 ($'s not in
thousands).

      The Predecessor adopted a stock purchase plan for employees (the "Employee
Stock Purchase Plan") and a stock purchase plan for non-employee directors (the
"Non-Employee Director Stock Purchase Plan"). Under the Employee Stock Purchase
Plan, 160,000 shares of Class A Common Stock are available for purchase by
eligible employees of the Predecessor or any of its subsidiaries. Under the
Non-Employee Director Stock Purchase Plan, 25,000 shares of Class A Common Stock
are available for purchase by non-employee directors of the Predecessor. The
purchase price of each share of Class A Common Stock purchased under the
Employee Stock Purchase Plan or the Non-Employee Director Stock Purchase Plan
will be the lesser of 90 percent of the fair market value of the Class A Common
Stock on the first trading day of the plan year or on the last day of such plan
year; provided, however, that in no event shall the purchase price be less than
the par value of the stock. Both plans will terminate in 2005, unless terminated
at an earlier date by the board of directors. During the year ended December 31,
1996, 15,541 shares were issued under the Employee Stock Purchase Plan and 1,702
shares were issued under the Non-Employee Director Stock Purchase Plan at a
purchase price of $16.85 ($'s not in thousands). Compensation cost computed
under the provisions of SFAS No. 123 related to the shares issued under the
Employee Stock Purchase Plan and the Non-Employee Director Stock Purchase Plan
is immaterial to the consolidated financial statements.

      In connection with the acquisition of Palmer, the Company retired all of
the options of Palmer that were outstanding.


                                      F-17
<PAGE>

              PRICE COMMUNICATIONS WIRELESS, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(11) Related Party Transactions

      On January 1, 1997 the Predecessor purchased a building and certain towers
from PCI for $6.2 million. These assets were previously leased from PCI.

      Concurrently with the Offering and the Exchange, the Predecessor and PCI
entered into both a transitional management and administrative services
agreement and a computer services agreement that extended each December 31 for
additional one-year periods unless and until either party notified the other.
The fees from these arrangements amounted to a total of $534,000 and $88,000 for
the years ended December 31, 1996 and the nine months ended September 30, 1997,
respectively, and are included as a reduction of selling, general and
administrative expenses.

      Concurrently with the Offering and the Exchange, the Predecessor and PCI
entered into a tax consulting agreement that extended each December 31 for
additional one-year periods unless and until either party notified the other.
The fees for tax consulting services amounted to a total of $120,000 and $97,000
for the years ended December 31, 1996 and the nine months ended September 30,
1997, respectively, and are included in selling, general and administrative
expenses.

      PCI has a 401(k) plan with a noncontributory retirement feature and a
matching provision for employees who meet length of service and other
requirements. The Predecessor participated in this plan and was allocated 401(k)
retirement and matching expense of $696,000 and $544,000 for the years ended
December 31, 1996, and the nine months ended September 30, 1997, respectively.

(12) Commitments and Contingencies

      Leases

      The Company occupies certain buildings and uses certain tower sites, cell
sites and equipment under noncancelable operating leases which expire through
2013.

      Future minimum lease payments under noncancelable operating leases as of
December 31, 1998 are as follows:

                                                                ($ in thousands)
Year ending December 31:
      1999  ..................................................       $2,807
      2000  ..................................................        2,244
      2001  ..................................................        1,764
      2002  ..................................................        1,233
      2003  ..................................................          710
      Later years through 2013 ...............................        1,120
                                                                     ------
           Total minimum lease payments ......................       $9,878
                                                                     ======

      Rent expense for the Company was $2,928 for the year ended December 31,
1998 and $806 for the period from May 29, 1997 to December 31, 1997 and for the
Predecessor was $3,123, and $3,551 for the nine months ended September 30, 1997
and the year ended December 31, 1996, respectively, of which $278 was paid to
related parties for 1996.

      Contingencies

      The Company is involved in various claims and legal actions arising in the
ordinary course of business. In the opinion of management, the ultimate
disposition of these matters will not have a material adverse effect on the
Company's consolidated financial statements.


                                      F-18
<PAGE>

              PRICE COMMUNICATIONS WIRELESS, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(13) Selected Quarterly Financial Data (Unaudited)

<TABLE>
<CAPTION>
                                                        ($ in thousands)
                                                  Predecessor                        Company
                                                  -----------                        -------
                                                                                  For the Period
                                                                                   May 29, 1997
                                                                                      Through
                                    First           Second            Third         December 31,
Year Ended December 31, 1997       Quarter          Quarter          Quarter          1997 (b)
----------------------------       -------          -------          -------          --------
<S>                              <C>              <C>              <C>              <C>        
Total Revenue                    $    44,683      $    48,545      $    48,508      $    43,713
                                 ===========      ===========      ===========      ===========
Operating Income                 $     9,805(a)   $    13,022(a)   $    12,984(a)   $     8,616
                                 ===========      ===========      ===========      ===========
Net Income (Loss)                $     1,177      $     2,523      $     2,389      $    (8,852)
                                 ===========      ===========      ===========      ===========

<CAPTION>
                                    First           Second            Third           Fourth
Year Ended December 31, 1998       Quarter          Quarter         Quarter(c)        Quarter
----------------------------       -------          -------         ----------        -------
<S>                              <C>              <C>              <C>              <C>        
Total Revenue                    $    43,275      $    48,918      $    51,920      $    53,216
                                 ===========      ===========      ===========      ===========
Operating Income                 $     7,923      $    11,035      $    12,065      $    14,003
                                 ===========      ===========      ===========      ===========
Net Income (Loss)                     (6,571)     $   (10,810)     $   (21,777)     $    (8,036)
                                 ===========      ===========      ===========      ===========
</TABLE>

(a)   Certain reclassifications were made to conform to the fourth quarter
      presentation.

(b)   The decrease in operating income in the fourth quarter is a result of
      customer acquisition costs, including advertising, commissions and phone
      discounts, related to Holiday sales (consistent with prior years), the
      Fort Myers Sale, and amortization of the additional license recorded in
      the merger. The net loss is due to these reasons as well as the interest
      expense on debt incurred to fund the Acquisition

(c)   The increase in net loss is principally a result of the extraordinary loss
      associated with the early extinguishment of debt.


                                      F-19
<PAGE>

                                   SIGNATURES

      Pursuant to the requirements of Section 13 and 15(d) of the Securities and
Exchange Act of 1934, the Company has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                 PRICE COMMUNICATIONS WIRELESS, INC.


                                 By:             /S/ ROBERT PRICE
                                     -------------------------------------------
                                                   Robert Price
                                         Director, President and Treasurer


                                 By:            /S/ KIM I. PRESSMAN
                                     -------------------------------------------
                                                  Kim I. Pressman
                                     Vice President and Chief Financial Officer


                                 By:         /S/ MICHAEL WASSERMAN
                                     -------------------------------------------
                                                 Michael Wasserman
                                     Vice President and Chief Accounting Officer

Dated:  February 26, 1999


                                      F-20
<PAGE>

                                  EXHIBIT INDEX

Exhibit
  No.                              Description

2.1   The Merger Agreement, incorporated by reference to Registration Statement
      on Form S-4 of the Company (File No. 333-36253)

3.1   Certificate of Incorporation of PCW, as amended, incorporated by reference
      to Registration Statement on Form S-4 of the Company (File No. 333-36253)

3.2   By-laws of PCW, incorporated by reference to Registration Statement on
      Form S-4 of the Company (File No. 333-36253)

4.1   Indenture to 11 3/4% Senior Subordinated Notes due 2007 between PCW and
      Bank of Montreal Trust Company, as Trustee (including form of Senior
      Subordinated Note), incorporated by reference to Registration Statement on
      Form S-4 of the Company (File No. 333-36253)

10.1  Credit Agreement dated as of September 30, 1997 among Holdings, PCW, the
      lenders listed therein, DLJ Capital Funding, Inc., as syndication agent
      and Bank of Montreal, Chicago branch, as administrative agent,
      incorporated by reference to Registration Statement on Form S-4 of the
      Company (File No. 333-36253)

10.2  Fort Myers Sale Agreement, incorporated by reference to Registration
      Statement on Form S-4 of the Company (File No. 333-36253)

10.3  Georgia Sale Agreement, incorporated by reference to Registration
      Statement on Form S-4 of the Company (File No. 333-36253)

10.4  Ryan Agreement, incorporated by reference to Registration Statement on
      Form S-4 of the Company (File No. 333-36253)

10.5  Wisehart Agreement, incorporated by reference to Registration Statement on
      Form S-4 of the Company (File No. 333-36253)

10.6  Meehan Agreement, incorporated by reference to Registration Statement on
      Form S-4 of the Company (File No. 333-36253)