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TRILOGY INTERNATIONAL PARTNERS LLC

CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 2016
AND 2015

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**REPORT OF INDEPENDENT REGISTERED
      PUBLIC ACCOUNTING** FIRM 
 
Board of Directors Trilogy International Partners, Inc.

We have audited the accompanying consolidated balance sheets of
Trilogy International Partners, LLC and subsidiaries (the Company) as of
December 31, 2016 and 2015, and the related consolidated statements of
operations and comprehensive loss, consolidated statement of mezzanine equity,
and Members deficit, and consolidated cash flows for each of the three years in
the period ended December 31, 2016. 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 the standards of the
Public Company Accounting Oversight Board (United States) and in accordance with
auditing standards generally accepted in the United States of America. Those
standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. We were not engaged to perform an audit of the Companys internal
control over financial reporting. Our audits included consideration of internal
control over financial reporting as a basis for designing audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Companys internal control over financial
reporting. Accordingly, we express no such opinion. An audit also includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, 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 consolidated financial statements referred
to above present fairly, in all material respects, the financial position of
Trilogy International Partners LLC and subsidiaries as of December 31, 2016 and
2015, and the results of their operations and their cash flows for each of the
three years in the period ended December 31, 2016 in conformity with accounting
principles generally accepted in the United States of America.

/s/ Grant Thornton LLP

Seattle, WA March 27, 2017

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PART I - FINANCIAL INFORMATION Item 1) Financial
Statements

TRILOGY INTERNATIONAL PARTNERS LLCConsolidated
Balance Sheets(US dollars in thousands, except unit amounts)

|                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | Years Ended December 31, |  
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | - | ------------------------ | -
|                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | 2016                     |  
|ASSETS                                                                                                                                                                                                                                                                                                                                                                                                                                           |  
|Current assets:                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |                          |  
|Cash and cash equivalents                                                                                                                                                                                                                                                                                                                                                                                                                        | $ | 21,154                   |  
|Accounts receivable,
      net                                                                                                                                                                                                                                                                                                                                                                                                                   |   | 71,273                   |  
|Equipment Installment Plan ("EIP")
      receivables, net                                                                                                                                                                                                                                                                                                                                                                                        |   | 20,246                   |  
|Inventory                                                                                                                                                                                                                                                                                                                                                                                                                                        |   | 20,440                   |  
|Prepaid expenses and other current
      assets                                                                                                                                                                                                                                                                                                                                                                                                  |   | 27,159                   |  
|Total current assets                                                                                                                                                                                                                                                                                                                                                                                                                             |   | 160,272                  |  
|Property and equipment, net                                                                                                                                                                                                                                                                                                                                                                                                                      |   | 393,565                  |  
|License costs and other intangible assets,
      net                                                                                                                                                                                                                                                                                                                                                                                             |   | 113,054                  |  
|Goodwill                                                                                                                                                                                                                                                                                                                                                                                                                                         |   | 9,294                    |  
|Long-term equipment installment plan
      receivables                                                                                                                                                                                                                                                                                                                                                                                           |   | 12,738                   |  
|Other assets                                                                                                                                                                                                                                                                                                                                                                                                                                     |   | 17,281                   |  
|Assets held for sale from discontinued
      operations                                                                                                                                                                                                                                                                                                                                                                                          |   | -                        |  
|Total assets                                                                                                                                                                                                                                                                                                                                                                                                                                     | $ | 706,204                  |  
|                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                          |  
|LIABILITIES, MEZZANINE EQUITY AND MEMBERS'
      DEFICIT                                                                                                                                                                                                                                                                                                                                                                                         |  
|Current liabilities:                                                                                                                                                                                                                                                                                                                                                                                                                             |   |                          |  
|Accounts payable                                                                                                                                                                                                                                                                                                                                                                                                                                 | $ | 45,827                   |  
|Construction accounts
      payable                                                                                                                                                                                                                                                                                                                                                                                                              |   | 17,869                   |  
|Current portion of debt                                                                                                                                                                                                                                                                                                                                                                                                                          |   | 8,796                    |  
|Customer deposits and
      unearned revenue                                                                                                                                                                                                                                                                                                                                                                                                     |   | 22,727                   |  
|Other current liabilities and accrued
      expenses                                                                                                                                                                                                                                                                                                                                                                                             |   | 128,807                  |  
|Total current liabilities                                                                                                                                                                                                                                                                                                                                                                                                                        |   | 224,026                  |  
|Long-term debt                                                                                                                                                                                                                                                                                                                                                                                                                                   |   | 591,151                  |  
|Deferred income taxes                                                                                                                                                                                                                                                                                                                                                                                                                            |   | 2,744                    |  
|Other non-current liabilities                                                                                                                                                                                                                                                                                                                                                                                                                    |   | 37,168                   |  
|Liabilities held for sale from discontinued
      operations                                                                                                                                                                                                                                                                                                                                                                                     |   | -                        |  
|Total liabilities                                                                                                                                                                                                                                                                                                                                                                                                                                |   | 855,089                  |  
|Commitments and contingencies                                                                                                                                                                                                                                                                                                                                                                                                                    |   |                          |  
|Mezzanine Equity                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |                          |  
|Redeemable Class A
      Units                                                                                                                                                                                                                                                                                                                                                                                                                   |   | 96,956                   |  
|Total mezzanine equity                                                                                                                                                                                                                                                                                                                                                                                                                           |   | 96,956                   |  
|Members' deficit:                                                                                                                                                                                                                                                                                                                                                                                                                                |   |                          |  
|Trilogy International Partners LLC
      members' deficit:                                                                                                                                                                                                                                                                                                                                                                                       |   |                          |  
|Members'
      investment (206,892 Class A, 141,496 Class B units issued
      and            outstanding
      and 15,321 authorized and 12,981 issued and
      outstanding            Class
      C units as of December 31, 2016. 201,146 Class A, 141,496 Class
      B            units
      issued and outstanding and 15,321 authorized and 12,981
      issued            and
      outstanding Class C Units as of December 31, 2015) |   | 275,602                  |  
|Accumulated
      deficit                                                                                                                                                                                                                                                                                                                                                                                                                        |   | (598,141                 | )
|Accumulated other comprehensive income                                                                                                                                                                                                                                                                                                                                                                                                           |   | 6,151                    |  
|Total Trilogy
      International Partners LLC members' deficit                                                                                                                                                                                                                                                                                                                                                                                  |   | (316,388                 | )
|Noncontrolling
      interests                                                                                                                                                                                                                                                                                                                                                                                                                   |   | 70,547                   |  
|Total members'
      deficit                                                                                                                                                                                                                                                                                                                                                                                                                     |   | (245,841                 | )
|Total liabilities, mezzanine equity and
      members' deficit                                                                                                                                                                                                                                                                                                                                                                                   | $ | 706,204                  |  

|On behalf of the Board: |                      |                  
|----------------------- | -------------------- | -----------------
|                        |                      |                  
|/s/ Mark Kroloff        | /s/ Anthony Lacavera | /s/ Nadir Mohamed
|                        |                      |                  
|Mark Kroloff            | Anthony Lacavera     | Nadir Mohamed    
|Director                | Director             | Director         

The accompanying notes are an integral part of these
Consolidated Financial Statements 3

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TRILOGY INTERNATIONAL PARTNERS LLCConsolidated
Statements of Operations and Comprehensive Loss(US dollars in
thousands, except unit and per unit amounts)

|                                                                                                           |   | Years Ended December 31, |  
|---------------------------------------------------------------------------------------------------------- | - | ------------------------ | -
|                                                                                                           |   | 2016                     |  
|                                                                                                           |   |                          |  
|Revenues                                                                                                   |   |                          |  
|Wireless service revenues                                                                                  | $ | 524,740                  |  
|Wireline service revenues                                                                                  |   | 43,397                   |  
|Equipment sales                                                                                            |   | 178,772                  |  
|Non-subscriber international long distance
      and other revenues                                        |   | 16,507                   |  
|Total revenues                                                                                             |   | 763,416                  |  
|                                                                                                           |   |                          |  
|Operating expenses                                                                                         |   |                          |  
|Cost of service, exclusive of depreciation,
      amortization and accretion shown separately              |   | 212,695                  |  
|Cost of equipment sales                                                                                    |   | 197,861                  |  
|Sales and marketing                                                                                        |   | 104,468                  |  
|General and administrative                                                                                 |   | 102,260                  |  
|Depreciation, amortization and accretion                                                                   |   | 105,456                  |  
|Loss on disposal and abandonment of assets                                                                 |   | 609                      |  
|Total operating
      expenses                                                                             |   | 723,349                  |  
|Operating income                                                                                           |   | 40,067                   |  
|                                                                                                           |   |                          |  
|Other (expenses)                                                                                           |   |                          |  
|Interest expense                                                                                           |   | (69,055                  | )
|Debt modification costs                                                                                    |   | (3,802                   | )
|Other, net                                                                                                 |   | (133                     | )
|Total other expenses, net                                                                                  |   | (72,990                  | )
|Loss from continuing
      operations before income taxes                                                  |   | (32,923                  | )
|Income tax expense                                                                                         |   | (7,642                   | )
|Loss from continuing
      operations                                                                      |   | (40,565                  | )
|Gain (loss) from discontinued operations, net of tax                                                       |   | 50,303                   |  
|Net income (loss)                                                                                          |   | 9,738                    |  
|Less: Net (income) loss attributable to
      noncontrolling interests                                     |   | (7,630                   | )
|Net income (loss)
      attributable to Trilogy International Partners LLC                                 | $ | 2,108                    |  
|                                                                                                           |   |                          |  
|Other comprehensive income (loss)                                                                          |   |                          |  
|Net income (loss)                                                                                          | $ | 9,738                    |  
|Other comprehensive income (loss):                                                                         |   |                          |  
|Foreign currency translation
      adjustments                                                             |   | 1,816                    |  
|Net gain on derivatives                                                                                    |   | 710                      |  
|Other comprehensive income (loss)                                                                          |   | 2,526                    |  
|Comprehensive income (loss)                                                                                |   | 12,264                   |  
|Comprehensive (income) loss
      attributable to noncontrolling interests                                 |   | (8,275                   | )
|Comprehensive
      income (loss) attributable to Trilogy International Partners LLC                       | $ | 3,989                    |  
|                                                                                                           |   |                          |  
|Basic and diluted net earnings (loss)
      per unit                                                       |   |                          |  
|Loss from continuing operations attributable to Trilogy
      International Partners LLC per unit          | $ | (140                     | )
|Gain (loss) from discontinued operations
      attributable to Trilogy International Partners LLC per unit |   | 146                      |  
|Net income (loss) attributable to
      Trilogy International Partners LLC per unit                        | $ | 6                        |  
|                                                                                                           |   |                          |  
|Weighted Average Units outstanding                                                                         |   |                          |  
|Basic and Diluted                                                                                          |   | 343,443                  |  

The accompanying notes are an integral part of these
Consolidated Financial Statements 4

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TRILOGYINTERNATIONALPARTNERSLLCConsolidatedStatementofMezzanineEquity andMembers'Deficit(US dollars inthousands,except units)

|                                                   |  | Mezzanine Equity |  |   | Trilogy International Partners LLC Members' |  |  |         |  |  |         | 
|-------------------------------------------------- |  | ---------------- |  | - | ------------------------------------------- |  |  | ------- |  |  | ------- | 
|                                                   |  |                  |  |   |                                             |  |  |         |  |  |         | 
|                                                   |  |                  |  |   |                                             |  |  |         |  |  |         | 
|                                                   |  | Redeemable       |  |   |                                             |  |  |         |  |  |         | 
|                                                   |  | Class A          |  |   | Members'                                    |  |  | Class A |  |  | Class B | 
|                                                   |  | Units            |  |   | Investment                                  |  |  | Units   |  |  | Units   | 
|Balance, December 31, 2013                         |  | 73,590           |  | $ | 96,956                                      |  |  | 127,556 |  |  | 141,496 | 
|Net loss                                           |  | -                |  |   | -                                           |  |  | -       |  |  | -       | 
|Other comprehensive loss                           |  | -                |  |   | -                                           |  |  | -       |  |  | -       | 
|Share purchase from noncontrolling interest        |  | -                |  |   | -                                           |  |  | -       |  |  | -       | 
|Note receivable from noncontrolling
      interest |  | -                |  |   | -                                           |  |  | -       |  |  | -       | 
|Dividend to noncontrolling interest                |  | -                |  |   | -                                           |  |  | -       |  |  | -       | 
|Changes in noncontrolling interests                |  | -                |  |   | -                                           |  |  | -       |  |  | -       | 
|Balance, December 31, 2014                         |  | 73,590           |  |   | 96,956                                      |  |  | 127,556 |  |  | 141,496 | 
|Net income (loss)                                  |  | -                |  |   | -                                           |  |  | -       |  |  | -       | 
|Other comprehensive loss                           |  | -                |  |   | -                                           |  |  | -       |  |  | -       | 
|Member contribution                                |  | -                |  |   | -                                           |  |  | -       |  |  | -       | 
|Changes in noncontrolling interests                |  | -                |  |   | -                                           |  |  | -       |  |  | -       | 
|Balance, December 31, 2015                         |  | 73,590           |  |   | 96,956                                      |  |  | 127,556 |  |  | 141,496 | 
|Net income                                         |  | -                |  |   | -                                           |  |  | -       |  |  | -       | 
|Other comprehensive loss                           |  | -                |  |   | -                                           |  |  | -       |  |  | -       | 
|Member contribution                                |  | -                |  |   | -                                           |  |  | 5,746   |  |  | -       | 
|Dividend to noncontrolling interest                |  | -                |  |   | -                                           |  |  | -       |  |  | -       | 
|Changes in noncontrolling interests                |  | -                |  |   | -                                           |  |  | -       |  |  | -       | 
|Balance, December 31, 2016                         |  | 73,590           |  | $ | 96,956                                      |  |  | 133,302 |  |  | 141,496 | 

The accompanying notes are an integral part of these
Consolidated Financial Statements 5

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TRILOGY INTERNATIONAL PARTNERS
LLCConsolidated Statements of Cash Flows(US
Dollars in thousands)

|                                                                                                          |   | Years Ended December 31, |  
|--------------------------------------------------------------------------------------------------------- | - | ------------------------ | -
|                                                                                                          |   | 2016                     |  
|Operating activities:                                                                                     |   |                          |  
|Net income (loss)                                                                                         | $ | 9,738                    |  
|Adjustments to reconcile net income
      (loss) to net cash provided by      operating
      activities: |   |                          |  
|Provision
      for doubtful accounts                                                                     |   | 7,928                    |  
|Depreciation, amortization and accretion                                                                  |   | 105,472                  |  
|Equity-based compensation                                                                                 |   | 2,706                    |  
|Loss on disposal and abandonment of assets                                                                |   | 613                      |  
|Non-cash
      interest expense, net                                                                      |   | 4,517                    |  
|Settlement of cash flow hedges                                                                            |   | (1,836                   | )
|Debt
      modification costs                                                                             |   | 3,802                    |  
|Non-cash loss from change in fair value on cash flow hedges                                               |   | 1,475                    |  
|Unrealized
      (gain) loss on foreign exchange transactions                                             |   | (1,775                   | )
|Deferred income taxes                                                                                     |   | (3,951                   | )
|Gain on
      disposal of discontinued operations                                                         |   | (52,792                  | )
|Changes in operating assets and liabilities:                                                              |   |                          |  
|Accounts receivable                                                                                       |   | (13,489                  | )
|EIP receivables                                                                                           |   | (4,588                   | )
|Inventory                                                                                                 |   | 3,790                    |  
|Prepaid expenses and other current assets                                                                 |   | 896                      |  
|Other assets                                                                                              |   | (509                     | )
|Accounts payable                                                                                          |   | (5,736                   | )
|Other current liabilities and accrued expenses                                                            |   | (2,316                   | )
|Customer deposits and unearned revenue                                                                    |   | (4,978                   | )
|Net cash provided by operating
      activities                                                           |   | 48,967                   |  
|Investing activities:                                                                                     |   |                          |  
|Purchase of property and equipment                                                                        |   | (107,780                 | )
|Proceeds from the sale of
      Trilogy Dominicana, net of cash sold of $875                              |   | 28,723                   |  
|Changes in restricted cash                                                                                |   | 7,461                    |  
|Purchase of spectrum licenses
      and other additions to license costs                                  |   | (2,636                   | )
|Acquisition of a business, net of cash
      acquired                                                     |   | -                        |  
|Proceeds from sale and
      disposal of property and equipment                                           |   | 106                      |  
|Changes in Long-term deposits and other                                                                   |   | (146                     | )
|Net cash used in
      investing activities                                                               |   | (74,272                  | )
|Financing activities:                                                                                     |   |                          |  
|Payments of debt                                                                                          |   | (582,039                 | )
|Proceeds from debt                                                                                        |   | 581,167                  |  
|Debt issuance and modification
      costs                                                                |   | (7,577                   | )
|Cash dividend to noncontrolling interest                                                                  |   | (7,116                   | )
|Capital contributions from
      members                                                                  |   | 5,000                    |  
|Deferred equity issuance costs paid                                                                       |   | (4,947                   | )
|Transaction with 2degrees
      noncontrolling interest                                                   |   | (3,567                   | )
|Capital contributions from noncontrolling
      interests                                                 |   | -                        |  
|Payment of financed license
      obligation                                                              |   | -                        |  
|Purchase of shares from noncontrolling
      interest                                                     |   | -                        |  
|Net cash (used
      in) provided by financing activities                                                 |   | (19,079                  | )
|Net (decrease) increase in cash and cash equivalents                                                      |   | (44,384                  | )
|Cash and cash equivalents, beginning of
      year (1)                                                    |   | 64,993                   |  
|Effect of exchange rate changes                                                                           |   | 545                      |  
|Cash and cash equivalents, end of year
      (2)                                                          | $ | 21,154                   |  

(1)Includes cash and cash equivalents reclassified
to assets held for sale of $1,142, $1,514 and $1,383 as of January 1, 2016,
2015, and 2014, respectively. (2)Includes cash and cash
equivalents reclassified to assets held for sale of $1,142 and $1,514 as of
December 31, 2015 and 2014, respectively.

The accompanying notes are an integral part of these
Consolidated Financial Statements 6

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TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

NOTE 1  DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION AND
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Business

Trilogy International Partners LLC, a Washington limited
liability company, together with its consolidated subsidiaries in New Zealand
and Bolivia (the Company, Trilogy, we, and our) is a provider of
wireless voice and data communications including local, international long
distance and roaming services, for both customers and international visitors
roaming on its networks. The Companys services are provided under Global System
for Mobile Communications (GSM or 2G), Universal Mobile Telecommunication
Service, a GSM-based third generation mobile service for mobile communications
networks (3G), and Long Term Evolution (LTE), a widely deployed fourth
generation service (4G), technologies. The Company also provides fixed
broadband communications to business and residential customers.

Below is a brief summary of each of Trilogys operations:

New Zealand:Two Degrees Mobile Limited
(2degrees) was formed under the laws of New Zealand on February 15, 2001.
2degrees is licensed through November 2022, and has secured additional spectrum
through November 2031, to provide nationwide wireless communication services.
2degrees launched commercial operations in 2009 as the third operator in New
Zealand. 2degrees provides voice, data and long distance services to its
customers over a 2G, 3G and 4G network. 2degrees also maintains inbound visitor
roaming and international outbound roaming agreements with various international
carriers. Additionally, with the acquisition of Snap Limited (Snap) on April
30, 2015, 2degrees began offering fixed broadband communications services to
residential and enterprise customers (see Note 2  Snap Acquisition for more
details).

As of December 31, 2016, through its consolidated subsidiaries,
Trilogys voting ownership interest in 2degrees was 62.9% and the remaining
37.1% was held by four different parties (including a trustee holding employee
shares pursuant to the terms of the 2degrees Option Plan, as defined in Note 13
 Equity-Based Compensation and Payments).

Bolivia:In November 1999, Empresa de
Telecomunicaciones NuevaTel (PCS de Bolivia), S.A. (NuevaTel) was formed to
engage in Personal Communication Systems (PCS) operations. NuevaTel was
awarded its first PCS license in 1999 and commenced commercial service in
November 2000 under the brand name Viva. NuevaTel provides voice and data
services, including an array of services delivered via a short message
service-based platform, to its mobile customers in Bolivia over the existing GSM
network. NuevaTels 2G, 3G and 4G networks provide a variety of data services,
including high-speed Internet, messaging services and application and content
downloads. NuevaTel offers its mobile communications services through both
prepaid and postpaid payment plans, although the majority of NuevaTels
subscribers pay on a prepaid basis. In addition to basic voice and data
services, NuevaTel offers public telephony services. NuevaTels public telephony
service utilizes wireless pay telephones located in stores and call centers that
are owned and managed by NuevaTel resellers.

As of December 31, 2016, Trilogy, through its consolidated
subsidiaries, owned 71.5% of NuevaTels stock and the remaining 28.5% was owned
by a third-party limited liability cooperative organized under the laws of the
Republic of Bolivia.

Basis of Presentation and Principles of Consolidation

The Companys Consolidated Financial Statements have been
prepared in accordance with accounting principles generally accepted in the
United States of America (GAAP). The Company consolidates majority-owned
subsidiaries over which it exercises control, as well as variable interest
entities (VIEs) where it is deemed to be the primary beneficiary and thus VIEs
are required to be consolidated in our financial statements. All significant
intercompany transactions and accounts have been eliminated in consolidation for
all periods presented.

7

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TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

The Company has two reportable segments, New Zealand and
Bolivia. Unallocated corporate operating expenses, which pertain primarily to
corporate administrative functions that support the operating segments, but are
not specifically attributable to or managed by any segment, are presented as a
reconciling item between total segment operating results and consolidated
financial results. Additional details on our reportable segments are included in
Note 19  Segment Information, of these Consolidated Financial Statements.

Significant Accounting Policies

Use of Estimates:

The preparation of financial statements in conformity with GAAP
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and the reported amounts of revenues and
expenses for the reporting periods presented. Certain estimates require
difficult, subjective or complex judgments about matters that are inherently
uncertain. Actual results could differ from those estimates.

Examples of significant estimates include the allowance for
doubtful accounts, the useful lives of property and equipment, amortization
periods for intangible assets, fair value of financial instruments and
equity-based compensation, imputed interest on equipment installment
receivables, cost estimates for asset retirement obligations, deferred income
taxes, fair value measurements related to goodwill, spectrum licenses and
intangibles, projections used in impairment analysis, evaluation of minimum
operating lease terms, the allocation of purchase price in connection with
business combinations and the period for recognizing prepaid and postpaid
revenue based on breakage.

The Company records estimated revenue for rollover services
(unused credit carried from month to month for up to 12 billing cycles) that is
not expected to be used by its customers. These estimates are based primarily on
rate plans in effect and our historical usage and billing patterns. In 2016, as
a result of changes in rate plans and offerings and the related impacts on
vendor-specific objective evidence as used for values applied to rollover
balances (primarily for data services), the Company recorded a $1.7 million
increase in Wireless service revenues offset by a reduction to Customer deposits
and unearned revenue, as a change in estimate.

Cash and Cash Equivalents:

Cash and cash equivalents consist of highly liquid investments
with original maturities of three months or less at the acquisition date or with
a variable rate which can be liquidated on demand. The balance of cash and cash
equivalents held by our foreign consolidated subsidiaries was $18.7 million and
$30.1 million as of December 31, 2016 and 2015, respectively.

Restricted Cash:

The Company classifies cash as restricted when the cash is
unavailable for use in general operations. These balances are reclassified to
Cash and cash equivalents when the underlying obligation is satisfied, or in
accordance with the governing agreement. Restricted cash expected to become
unrestricted during the next twelve months is recorded in current assets. The
Company had $1.7 million and $9.3 million of restricted cash included in Prepaid
expenses and other current assets and Other assets within the Consolidated
Balance Sheets as of December 31, 2016 and 2015, respectively. The restricted
cash balances consisted primarily of cash balances held as collateral for
derivative instruments and cash received from divestures for which all the
conditions of sale had not yet been achieved.

Accounts Receivable, net:

Accounts receivable consist primarily of amounts billed and due
from customers, other wireless service providers, and dealers (third party
retail channels) and are generally unsecured. Local interconnection and telecom
cooperative receivables due from other wireless service providers represent
$29.6 million and $28.8 million of Accounts receivable, net at December 31, 2016
and 2015, respectively. Interconnection receivables and payables are reported on
a gross basis on the Consolidated Balance Sheets and on the Consolidated
Statements of Cash Flows as the amounts do not have a legal right to offset,
consistent with the presentation of related interconnection revenues and
expenses on the Consolidated Statements of Operations and Comprehensive
Loss.

8

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TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

Management makes estimates of the uncollectability of its
accounts receivable. In determining the adequacy of the allowance of doubtful
accounts, management analyzes historical experience and current collection
trends, known troubled accounts, receivable aging and current economic trends.
The Company writes off account balances against the allowance for doubtful
accounts when collection efforts are unsuccessful. Provisions for uncollectible
receivables are included in General and administrative expenses. The allowance
for doubtful accounts was $5.1 million and $4.6 million as of December 31, 2016
and 2015, respectively.

Equipment Installment Plan (EIP) Receivable:

In New Zealand, the Company offers certain wireless customers
the option to pay for their handset in installments over a period of up to 24
months using an EIP. The amounts recorded as EIP receivables at the end of each
period represent the receivables for which invoices were not yet generated for
the customer (unbilled). Invoiced EIP receivables (billed) are recorded in
the Accounts receivable, net balance, consistent with other outstanding customer
trade receivables. The Company assesses the credit quality of each EIP applicant
and applicants representing the greatest risk of default are declined from
participation. Customers considered to be high risk must participate in a risk
mitigation program which includes paying a deposit and allowing for automatic
payments. All EIP customers are required to make a down payment for handsets
financed through an EIP. The current portion of the EIP receivables is included
in Equipment installment plan receivables, net and the long-term portion of the
EIP receivables is included in Long-term equipment installment plan receivables
on our Consolidated Balance Sheets.

At the time of sale, we impute risk adjusted interest on the
receivables associated with EIPs. We record the imputed interest as a reduction
of equipment sales, and the deferred interest is included within Equipment
installment plan receivables, net on the Consolidated Balance Sheets.The
balance of the unamortized imputed interest recorded as of December 31, 2016 and
2015 was $2.3 million and $2.0 million, respectively. Interest income is
recognized over the term of the EIP contract in Other, net on our Consolidated
Statements of Operations and Comprehensive Loss.

The Company establishes an allowance for EIP receivables to
cover probable and reasonably estimated losses. The estimate of allowance for
doubtful accounts considers a number of factors, including collection
experience, receivable aging, customer credit quality and other qualitative
factors including macro-economic factors. The Company monitors the EIP
receivable balances and writes off account balances if collection efforts are
unsuccessful and future collection is unlikely. See Note 6  EIP Receivables for
additional information as it relates to the allowance for doubtful accounts
specifically attributable to the EIP receivables.

Inventories:

Inventory consists primarily of wireless devices and
accessories, which are valued at the lower of cost or market. Cost is determined
by the first-in, first-out (FIFO) method and weighted average cost method
which has historically approximated the FIFO method. Market value is determined
using current replacement cost. The Company records inventory write-downs to net
realizable value for obsolete and slow-moving items based on inventory turnover
trends and historical experience.

Handset costs in excess of the revenues generated from handset
sales, or handset subsidies, are expensed at the time of sale. The Company does
not recognize the expected handset subsidies prior to the time of sale because
the promotional discount decision is made at the point of sale and/or because
the Company expects to recover the handset subsidies through service revenues.

The Company also records inventories on our Consolidated
Balance Sheets, with a corresponding increase to Other current liabilities and
accrued expenses, for inventories held by a third-party distribution and
logistics company located in New Zealand. The third-party distribution and
logistics company purchases the inventory from various equipment manufacturers
on behalf of and at the directions of 2degrees specifying the purchase price,
timing of purchase, and type and quantity of handsets. Therefore, the Company
records the inventory once risk of loss is assumed in connection with the
transfer from the manufactures to the third-party distribution and logistics
company.

9

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TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

Property and Equipment:

Property and equipment is recorded at cost or fair value for
assets acquired as part of business combinations and depreciation is calculated
on a straight-line method over the estimated useful lives of the assets.
Estimated useful lives are generally as follows: (i) buildings range from 28 to
50 years; (ii) wireless communications systems range from 2 to 20 years; and
(iii) furniture, equipment, vehicles and software range from 2 to 17 years.
Leasehold improvements are recorded at cost and depreciated over the lesser of
the term of the lease or the estimated useful life. Costs of additions and major
replacements and improvements are capitalized. Repair and maintenance
expenditures which do not enhance the assets functionality or extend the
assets useful life are charged to operating expenses as incurred. Construction
costs, labor and overhead incurred in the expansion or enhancement of the
Companys networks are capitalized. Capitalization commences with
pre-construction period administrative and technical activities, which may
include obtaining leases, zoning approvals and building permits, and ceases at
the point at which the asset is ready for its intended use and placed in
service. Upon sale or retirement of an asset, the related costs and accumulated
depreciation are removed from the balance sheet accounts and any gain or loss is
recognized. Assets under construction are not depreciated until placed in
service.

Interest expense incurred during the construction phase of the
Companys wireless networks is capitalized as part of property and equipment
until the projects are ready for its intended use and the assets are placed into
service. Capitalized interest costs are amortized over the estimated useful
lives of the related assets. Interest capitalized for the years ended December
31, 2016, 2015 and 2014 was $1.7 million, $1.1 million and $1.6 million,
respectively.

The Company capitalizes certain costs incurred in connection
with developing or acquiring internal use software. Capitalization of software
costs commences once selection of a specific software project has been made and
the Company approves and commits to funding the project. Capitalized costs
include direct development costs associated with internal use software,
including internal direct labor costs and external costs of materials and
services. Capitalized software costs are included in Property and equipment, net
and amortized on a straight-line basis over the estimated useful life of the
asset. Costs incurred during the preliminary project stage, as well as
maintenance and training costs, are expensed as incurred.

The Company records an asset retirement obligation (ARO) for
the fair value of legal obligations associated with the retirement of tangible
long-lived assets and a corresponding increase in the carrying amount of the
related asset in the period in which the obligation is incurred. These
obligations primarily pertain to the Companys legal obligations related to the
network infrastructure, principally tower and related assets. These obligations
include obligations to remediate leased land on which the Companys network
infrastructure assets are located. The liability is accreted to its present
value each period, and the capitalized cost is depreciated over the estimated
useful life of the related asset. Upon settlement of the liability, any
difference between the recorded ARO liability and the actual retirement costs
incurred is recognized as an operating gain or loss in the Consolidated
Statement of Operations and Comprehensive Loss.

The significant assumptions used in estimating the Companys
ARO include the following: a probability that the Companys leases with ARO will
be remediated at the lessors directive; expected settlement dates that coincide
with lease expiration dates plus estimated lease extensions; remediation costs
that are indicative of what third party vendors would charge the Company to
remediate the sites; expected inflation rates that are consistent with
historical inflation rates; and credit-adjusted risk-free interest rates which
approximate the Companys incremental borrowing rates.

License Costs and Other Intangible Assets:

Intangible assets consist primarily of wireless spectrum
licenses in foreign markets, tradenames and subscriber relationships. License
costs primarily represent costs incurred to acquire wireless spectrum licenses
in foreign markets, which are recorded at cost, and the value attributed to
wireless spectrum licenses acquired in business combinations. Amortization
begins with the commencement of service to customers using the straight-line
method. The license costs are amortized over 7 to 20 years, which correspond
with the expiration dates of the licenses as issued by the regulators. Licenses
held, subject to certain conditions, are usually renewable and are generally
non-exclusive. When determining the useful life of the licenses, management
generally does not consider renewal periods since there is no certainty that a
license will be renewed without significant cost (or at no cost).

Subscriber relationships were acquired as part of the Snap
acquisition (see Note 2  Snap Acquisition) and relate to established
relationships with residential and enterprise customers through contracts.
Subscriber relationships are amortized over the estimated useful life of 7 years using an accelerated
method, which we believe best reflects the estimated pattern in which the
economic benefits of the assets will be consumed.

10

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TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

Impairment of Long-Lived Assets:

The Company evaluates its long-lived assets, including
intangible assets subject to amortization, for impairment whenever events or
changes in circumstances indicate that the carrying amount of the asset group
may not be recoverable. Asset groups are determined at the lowest level for
which identifiable cash flows are largely independent of cash flows of other
groups of assets and liabilities. When the carrying amount of a long-lived asset
group is not recoverable and exceeds its fair value, an impairment loss is
recognized equal to the excess of the asset groups carrying value over the
estimated fair value. We determine fair values by using a combination of
comparable market values, estimated future discounted cash flows and appraisals,
as appropriate. There were no events or changes in circumstances that indicated
impairment would be recorded for long-lived assets for the fiscal years ended
December 31, 2016, 2015 and 2014.

Goodwill:

Goodwill is the excess of the cost of an acquisition over the
fair value of the net identifiable assets acquired as of the acquisition date.
The Company reviews goodwill for impairment annually on December 31, the last
day of the fiscal fourth quarter and also if events or changes in circumstances
indicate the occurrence of a triggering event. We may elect to first perform a
qualitative assessment to determine whether it is more likely than not the fair
value of the reporting unit is less than its carrying amount as a basis for
determining whether it is necessary to perform the two-step goodwill impairment
test. If we do not perform a qualitative assessment, or if the qualitative
assessment indicates it is more likely than not that the fair value of the
single reporting unit is less than its carrying amount, goodwill is tested for
impairment based on a two-step test. In the first step, if required, the Company
determines if the fair value of the reporting unit is less than the book value.
If the Company concludes that the fair value of a reporting unit is less than
its book value, the Company must perform step two in which it calculates the
implied fair value of goodwill. If the implied fair value is less than book
value, then a goodwill impairment loss is recognized for the difference. If the
Company concludes that the fair value of a reporting unit is greater than its
book value, step two is not performed, and the Company concludes that there is
no goodwill impairment. Determining the fair value of a reporting unit involves
the use of significant estimates and assumptions. Generally fair value is
determined by a multiple of earnings based on the guideline publicly traded
business method or discounting projected future cash flows based on managements
expectations of the current and future operating environment. There were no
goodwill impairment charges required for any periods presented.

Derivative Instruments and Hedging Activities:

We employ risk management strategies, which may include the use
of interest rate swaps, cross-currency swaps and forward exchange contracts. We
do not hold or issue derivative instruments for trading or speculative purposes.

Derivatives are recognized in the Consolidated Balance Sheets
at fair value. Changes in the fair values of derivative instruments designated
as cash flow hedges, to the extent the hedges are highly effective, are
recorded in Other comprehensive loss. Derivative instruments not qualifying for
hedge accounting or ineffective portions of cash flow hedges, if any, are
recognized in current period earnings. The Company assesses, both at inception
of the hedge and on an ongoing basis, whether derivatives used as hedging
instruments are highly effective in offsetting the changes in the fair value or
cash flow of the hedged items. If it is determined that a derivative is not
highly effective as a hedge or ceases to be highly effective, the Company
discontinues hedge accounting prospectively. As of December 31, 2016 and 2015,
no derivative instruments were designated for hedge accounting.

Fair Value Measurements:

The Company applies fair value accounting for all financial
assets and liabilities and non-financial assets and liabilities that are
recognized or disclosed at fair value in the financial statements on a recurring
basis. The Company defines fair value as the price that would be received from
selling an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date. When determining the fair
value measurements for assets and liabilities, which are required to be recorded
at fair value, the Company considers the principal or most advantageous market
in which the Company would transact and the market-based risk measurements
or assumptions that market participants would use in pricing the asset or
liability, such as inherent risk, transfer restrictions and credit risk.

11

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TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

Required Distributions:

The Company is required to make quarterly distributions to its
members on a pro rata basis in accordance with each members ownership interest
in amounts sufficient to permit members to pay the tax liabilities resulting
from allocations of income tax items from the Company. The Company was in a net
taxable loss position for the years ended December 31, 2016, 2015 and 2014;
therefore, no tax distributions were made to its members related to these tax
years.

Revenue Recognition:

Wireless service revenues are primarily derived from providing
access to and usage of the Companys wireless networks. In general, access
revenues from wireless postpaid customers are billed in arrears and recognized
over the period that the corresponding services are rendered to customers.
Wireless service revenues derived from usage of the Companys networks,
including voice, data, roaming and long-distance revenues, are recognized when
the services are provided. As a result of the cutoff times of our multiple
billing cycles each month, we are required to estimate the amount of subscriber
revenues earned but not billed from the end of each billing cycle to the end of
each reporting period. The Company also records estimated wireless service
revenue for rollover services, unused credit carried from month to month for up
to 12 billing cycles, not expected to be used. These estimates are based
primarily on rate plans in effect and our historical usage and billing patterns.

Prepaid wireless services sold to customers are recorded as
unearned revenue prior to the commencement of services and is recognized when
the services are used or expire. When prepaid services are not subject to
expiration, the Company estimates breakage, cash consideration received for
prepaid services but never expected to be redeemed by customers, based upon
historical usage trends. The Companys policy is to recognize revenue for
estimated breakage when there is a remote likelihood the balance of prepaid
services will be redeemed.

Interconnection revenues are generated when calls from other
operators terminate on the Companys networks and are recognized in the period
the termination occurs.

Equipment sales consist principally of revenues from the sale
of wireless handsets and accessories to subscribers and dealers. Equipment
sales, including those on an EIP, are recognized when the products are delivered
to the customer or dealer. The revenues and related expenses associated with the
sale of wireless handsets and accessories through our indirect sales channels
are recognized when the products are delivered and accepted by the dealer,
including when products are provided by the third-party distribution company, as
this is considered to be a separate earnings process from the sale of wireless
services and probability of collection is likely.

The Company has determined that the sale of wireless services
through its direct sales channels with an accompanying handset constitutes a
revenue arrangement with multiple deliverables. The Company accounts for these
arrangements as separate units of accounting, including the wireless service and
handset. For these multiple element arrangements, the Company must: (1)
determine whether and when each element has been delivered; (2) determine
relative selling price of each element using the selling price hierarchy of
vendor-specific objective evidence of selling price, third party evidence, or
the Companys best estimate of selling price, as applicable, and; (3) allocate
the total price among the various elements based on the relative selling price
method. The revenue allocated to the multiple revenue streams is based on the
relative selling price to the total consideration from the sale. Consideration
allocated to the handset is recognized as equipment sales when the handset is
delivered and accepted by the subscriber. Consideration allocated to the
wireless service is recognized as service is rendered.

We also earn revenues from our wireline subscribers. These
revenues are based upon usage of its network and facilities, contract fees and
equipment sales. In general, fixed monthly fees for services are billed one
month in advance and are recognized when earned. Revenues from services that are
not fixed in amount and are based on usage are generally billed in arrears and
recognized when service is rendered. We sell each of these services separately
and each product or service has a standalone selling price. When equipment is
sold separately from services, revenue is recognized upon delivery to the
customer. When equipment is sold as part of a managed service, revenue is
recognized over the contract period.

12

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TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

Customer Sales Incentives:

The Company periodically provides incentive offers to its
customers to encourage purchases. Such offers include current discount offers
(e.g., percentage discounts off current purchases), inducement offers (e.g.,
offers for future discounts subject to a minimum current purchase), and
commissions. Current discount offers, when accepted by customers, are treated as
a reduction to the purchase price of the related transaction, while inducement
offers, when accepted by customers, are treated as a reduction to purchase price
based on estimated future redemption rates. Redemption rates are estimated using
the Companys historical experience for similar inducement offers. Current
discount offers and commissions are presented as a reduction to revenue unless
the Company receives, or will receive, an identifiable benefit in exchange for
the consideration, and the fair value of such benefit can be reasonably
estimated.

Pass Through Taxes:

The Company presents taxes imposed by governmental authorities
on revenue-producing transactions between us and our customers on a net basis.

Advertising Costs:

The Company expenses the cost of advertising as incurred.
Advertising expense for the years ended December 31, 2016, 2015 and 2014 were
$19.0 million, $21.3 million and $23.1 million, respectively.

Operating Leases:

The Companys cell sites are typically situated on leased
property including land, towers and rooftop locations. The Companys retail
stores, distribution facilities, office spaces and certain of its customer
service centers are also leased. The Companys lease contracts expire on various
dates through 2043 and generally provide for renewal options of up to an
additional ten years exercisable at our option. For scheduled rent escalation
clauses during the lease terms, the Company records minimum rental payments on a
straight-line basis over the fixed non-cancelable terms of the leases, including
those periods for which failure to renew the lease imposes a significant
economic penalty. If failure to exercise a renewal option imposes an economic
penalty, the Company may determine at the inception of the lease that renewal is
reasonably assured and include the renewal option period(s) in addition to the
fixed non-cancelable term of the lease in the determination of the appropriate
estimated lease term, up to the estimated economic life of the underlying
asset.

Defined Contribution Plan:

The Company has a defined contribution plan whereby
participants may contribute a portion of their eligible pay to the plan through
payroll withholdings. The Company provides matching contributions based on the
amount of eligible compensation contributed by the employees. Total
contributions by the Company were $0.1 million, $0.1 million and $0.1 million
for the years ended December 31, 2016, 2015 and 2014, respectively.

Equity-Based Compensation:

The Company measures compensation costs for all equity-based
payment awards made to employees based on the estimated fair values at the
either the grant date for equity classified awards or quarterly for liability
classified awards. The expense, net of estimated forfeitures, is recognized over
the requisite service period, which is generally the vesting period of the
award. The fair value of the equity-based payment awards is estimated using the
Black-Scholes option valuation model.

13

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TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

Net (Loss) Earnings Per Unit (EPU):

The Company has two classes of common units: Member units and
Profit interest units. Member units include Class A and B units which are issued
in exchange for capital contributions (hereafter the Member group). Profit
interest units consist of Class C units which are issued to employees or
independent contractors in exchange for performing services (hereafter the
Profit group). EPU is calculated separately for the Member group and for the
Profit group using the two-class method.

Basic (loss) income per unit (Basic EPU) is computed by dividing net (loss) income attributable to the Member group
unitholders and Profit group unitholders by the weighted average number of
Member group and Profit group units outstanding, respectively, for the period.
The Profit group is not included in the basic EPU calculation when the Company
operates at a loss due to the anti-dilutive effect.

Diluted (loss) income per unit (Diluted EPU) gives effect to
all dilutive potential Member units and Profit interest units outstanding during
the period using the treasury stock method. Diluted EPU excludes all potentially
dilutive units if the effect of their inclusion is anti-dilutive. Diluted EPU is
computed by dividing net (loss) income attributable to the Member group
unitholders and the Profit group unitholders by the weighted average number of
units outstanding, respectively.

Foreign Currency Remeasurement and Translation:

The functional currency for our Bolivian operation is the U.S.
dollar and for our New Zealand operation is the New Zealand dollar, since the
majority of the revenues and expenses in those operations are denominated in
those currencies. However, a portion of the revenues earned and expenses
incurred by our subsidiaries are denominated in currencies other than their
functional currency. These transactions are remeasured into the functional
currency based on a combination of both current and historical exchange rates.
All foreign currency asset and liability amounts are remeasured at end-of-period
exchange rates, except for nonmonetary items, which are remeasured at historical
rates. Foreign currency income and expense are remeasured at average exchange
rates in effect during the year, except for expenses related to balance sheet
amounts which are remeasured at historical rates. Gains and losses from
remeasurement of foreign currency transactions into the functional currency are
included in other, net on our Consolidated Statements of Operations in the
period in which they occur.

Assets and liabilities from our New Zealand operation are
translated from New Zealand dollar into U.S. dollar at the exchange rate on the
balance sheet date while revenue and expenses are translated at the average
exchange rate in the month they occurred. Gains and losses from the translation
of our New Zealand operations financial statements into U.S. dollars are
included in Accumulated other comprehensive income on our Consolidated Balance
Sheets.

Income Taxes:

For our taxable subsidiaries, we account for income taxes under
the asset and liability method, which requires the recognition of deferred tax
assets and liabilities for the expected future tax consequences of events that
have been included in the financial statements. Under this method, we determine
deferred tax assets and liabilities on the basis of the differences between the
financial statement and tax bases of assets and liabilities by using enacted tax
rates in effect for the year in which the differences are expected to reverse.
The effect of a change in tax rates on deferred tax assets and liabilities is
recognized in income in the period that includes the enactment date.

We recognize deferred tax assets to the extent that we believe
that these assets are more likely than not to be realized. In making such a
determination, we consider all available positive and negative evidence,
including future reversals of existing taxable temporary differences, projected
future taxable income, tax-planning strategies, and results of recent
operations. If we determine that we would be able to realize our deferred tax
assets in the future in excess of their net recorded amount, we would make an
adjustment to the deferred tax asset valuation allowance, which would reduce the
provision for income taxes.

We record uncertain tax positions on the basis of a two-step
process in which (1) we determine whether it is more likely than not that the
tax positions will be sustained on the basis of the technical merits of the
position and (2) for those tax positions that meet the more-likely-than-not
recognition threshold, we record the largest amount of tax benefit to meet such
threshold.

14

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TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

We recognize interest and penalties related to unrecognized tax
benefits on the Other, net line in the accompanying Consolidated Statements of
Operations. Accrued interest and penalties are included on the related tax
liability line in the Consolidated Balance Sheets.

Concentrations:

The Companys revenues are attributable to our international
operations. The Companys operations are subject to various political, economic,
and other risks and uncertainties inherent in the countries in which the Company
operates. Among other risks, the Companys operations are subject to the risks
of restrictions on transfer of funds; export duties, quotas and embargoes;
domestic and international customs and tariffs; changing taxation policies;
foreign exchange restrictions; and political conditions and governmental
regulations. For key financial information of our subsidiaries in New Zealand
and Bolivia, see Note 19  Segment Information.

Recently Adopted Accounting Standards:

In April 2015, the Financial Accounting Standards Board
(FASB) issued an Accounting Standards Update (ASU) related to the
presentation of debt issuance costs. The objective of this ASU is to simplify
the presentation of debt issuance costs by requiring that debt issuance costs
related to a recognized debt liability be presented in the balance sheet as a
direct deduction from the carrying amount of that debt liability, consistent
with debt discounts. This ASU was effective for financial statements issued for
fiscal years beginning after December 15, 2015 for publicly traded companies and
interim periods within those fiscal years. The Company adopted this standard in
fiscal 2016. As a result of the adoption, the Company reclassified unamortized
deferred financing costs from Other assets to Long-term debt for all periods
presented. The adoption did not have an impact on the Companys Consolidated
Statements of Operations or Consolidated Statements of Cash Flows. See
additional considerations in Note 9  Debt of these Consolidated Financial
Statements for amounts reclassified for each period presented.

In November 2015, the FASB issued an ASU related to
classification of deferred income taxes. This ASU requires entities to classify
Deferred Tax Assets (DTAs) and Deferred Tax Liabilities (DTLs) by
jurisdiction, as noncurrent in the balance sheet. The ASU simplifies the current
guidance, which requires entities to separately present DTAs and DTLs as current
and noncurrent in the balance sheet. This ASU is effective for financial
statements issued for fiscal years beginning after December 15, 2016 for public
companies, and interim periods within those years. Early adoption is permitted
for any interim or annual financial statements that have not been issued. The
Company early adopted this standard in the fourth quarter of 2016 and applied
the guidance retrospectively. As a result of the adoption, the Company
reclassified $6.1 million of DTA and $8.9 million current DTL to noncurrent DTL
in the Consolidated Balance Sheet. The adoption did not have an impact on the
Companys Consolidated Statements of Operations or Consolidated Statements of
Cash Flows.

Recently Issued Accounting Standards:

In February 2016, the FASB issued an ASU related to recognition
of leases. This standard will require organizations that lease assets to
recognize on the balance sheet the assets and liabilities for the rights and
obligations created by those leases. The new guidance will require both
classifications of leases, operating and capital, to be recognized on the
balance sheet. Consistent with current GAAP, the recognition, measurement, and
presentation of expenses and cash flows arising from a lease will depend on its
classification. The standard will require disclosures to help investors and
other financial statement users better understand the amount, timing and
uncertainty of cash flows arising from leases. This standard will take effect
for public entities for fiscal years beginning after December 15, 2018,
including interim periods within those fiscal years. Early adoption is permitted
for all organizations. The adoption of this ASU will result in the recognition
of significant right to use assets and lease liabilities in our Consolidated
Balance Sheets. Our evaluation is continuing, including the assessment of other
potential impacts of this ASU on our Consolidated Financial Statements.

In May 2014, the FASB issued an ASU related to revenue
recognition, which will supersede nearly all existing recognition guidance under
GAAP. The core principle of the guidance is that an entity should recognize
revenue to depict the transfer of promised goods or services to customers in an
amount that reflects the consideration to which the entity expects to be
entitled in exchange for those goods or services. To achieve that core
principle, an entity should apply the following steps: 1) identify the
contract(s) with a customer, 2) identify the performance obligations in the
contract, 3) determine the transaction price, 4) allocate the transaction price to the performance obligations
in the contract, and 5) recognize revenue when (or as) the entity satisfies a
performance obligation. For public entities, this pronouncement is effective for
annual reporting periods beginning after December 15, 2017. Early application is
not permitted. We expect the standard to impact the methods used to reserve for
discounts, refunds and other customer incentives, which may impact the timing of
revenue recognition. Our review is in its preliminary stage and we will continue
to evaluate additional impact that this ASU will have on our Consolidated
Financial Statements. Furthermore, the updated accounting guidance allows for
either a full retrospective adoption or modified retrospective adoption and we
continue to evaluate our method of adoption of this ASU.

15

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TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

NOTE 2  SNAP ACQUISITION

On April 30, 2015, the Company through its consolidated
subsidiary, 2degrees, completed the acquisition of 100% of the stock of Snap, a
New Zealand provider of fixed broadband communications services. Pursuant to the
terms of the purchase agreement, the purchase price of $28.4 million New Zealand
dollars (NZD) was paid by 2degrees through a combination of common stock of
2degrees and $9.9 million NZD in cash. The fair value of 2degrees shares issued
as consideration was determined by management with the assistance of a third
party valuation specialist. The cash consideration paid for the Snap acquisition
as well as cash paid for closing, integration and other costs were funded
through cash contributions of a total of $10.0 million from members of the
Company and the noncontrolling interest holders. The Snap acquisition was
accounted for under the acquisition method of accounting. The following table
summarizes the final allocation of the fair value of assets acquired and
liabilities assumed based on the exchange rate at the acquisition date (1.33 NZD
to 1.00 USD):

Consideration:Fair value of consideration transferred
      (2degrees stock)
    $
    13,832Cash consideration transferred
    
    7,624Total consideration transferred
    $
    21,456Identifiable assets acquired and liabilities
      assumed:Current assets
    $
    3,622Property and equipment
    
    3,874Identifiable intangible assets and
      internally developed software
    
    18,569Other non-current assets
    
    1,284Current liabilities
    
    (6,036
    )Current portion of long-term debt
    
    (976
    )Deferred tax liability - long-term
    
    (5,077
    )Capital leases
    
    (3,272
    )Other non-current liabilities
    
    (560
    )Total assets acquired net of liabilities assumed
    
    11,428Goodwill
    
    10,028$
    21,456


The goodwill recorded of $10,028 is primarily attributable to
the acquired workforce and operational and administrative synergies expected to
arise from the acquisition. The Company also recorded a deferred tax liability,
which relates to the intangible assets recognized as part of this stock
acquisition which do not have a corresponding basis for tax purposes.

Acquired identifiable assets and their estimated useful life in
years are as follows:

16

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TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

|Identifiable Intangible Assets and
      Internally |  |                |  | Estimated Useful
|--------------------------------------------------- |  | -------------- |  | ----------------
|Developed Software                                  |  | Purchase Price |  | Life in Years   
|Subscriber relationships                            |  | $ 14,058       |  | 7               
|Internally developed software                       |  | 3,834          |  | 3               
|Tradename                                           |  | 677            |  | 2               
|                                                    |  | $
      18,569 |  |                 

The following table shows the summarized financial information
included in our Consolidated Statements of Operations and Comprehensive Loss for
the year ended December 31, 2015 resulting from the acquisition of Snap from and
after May 1, 2015:

|                          |   | December 31, 2015 |  
|------------------------- | - | ----------------- | -
|Wireline service revenues | $ | 19,357            |  
|Operating expenses        |   | 26,076            |  
|Net loss                  |   | (4,950            | )

Operating expenses above include non-cash items such as
depreciation and amortization of $4.4 million for the year ended December 31,
2015.

The Company incurred professional fees such as legal,
accounting and valuation services of approximately $1.0 million related to this
acquisition, which were expensed as incurred and recognized in General and
administrative expenses in the Consolidated Statements of Operations and
Comprehensive Loss for the year ended December 31, 2015.

Unaudited Supplemental Pro Forma Information:

The pro forma information as presented below is for information
purposes only and is not indicative of operations that would have been achieved
from the Snap acquisition had they occurred at the beginning of Fiscal 2014.
Supplemental information on an unaudited pro forma basis is as follows:

|                                            |   | Fiscal Year 2015 |   |   | Fiscal Year 2014 |  
|------------------------------------------- | - | ---------------- | - | - | ---------------- | -
|Total revenue                               | $ | 688,603          |   | $ | 645,197          |  
|Loss from continuing operations, net of tax |   | (41,264          | ) |   | (39,367          | )

The unaudited pro forma supplemental amounts have been
calculated to reflect additional depreciation and amortization that would have
been charged assuming the fair value adjustments to the acquired assets and
assumed liabilities had been applied from the beginning of Fiscal 2014 with the
related tax effects.

17

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

NOTE 3  DISCONTINUED OPERATIONS

Trilogy Dominicana:

In March 2015, the Company committed to a plan to sell its
subsidiary in the Dominican Republic, Trilogy Dominicana S.A. (Trilogy
Dominicana). As a result of the plan to sell Trilogy Dominicana and the
discontinuance of further significant business activities in the Dominican
Republic, the assets and liabilities of Trilogy Dominicana were classified as
held for sale and the results of operations have been classified as discontinued
operations for all periods presented in accordance with FASB Accounting
Standards Codification 205-20, Discontinued Operations. The Company ceased
realizing depreciation on the related property and equipment at the time of
reclassification of such assets.

On May 22, 2015, the Company, through its subsidiary, Trilogy
International Dominican Republic LLC, entered into an agreement (as amended on
August 21, 2015) to sell its wholly-owned subsidiary, Trilogy Dominicana, to
Servicios Ampliados de Teléfonos S.A., a Dominican Republic entity, for a sale
price of $62 million. In connection with the sale agreement, the buyer
additionally agreed to fund the operations during the transition period. In
fiscal 2015, the Company received cash of $27 million from the buyer, of which
$5 million was recorded as restricted cash within Prepaid expenses and other
current assets in the Consolidated Balance Sheet as of December 31, 2015. The
offsetting credit was recorded as unearned proceeds within Other current
liabilities and accrued expenses in the Consolidated Balance Sheet as of
December 31, 2015. On March 23, 2016, the sale of Trilogy Dominicana was
completed and the Company received the remaining proceeds of $35.0 million and
recognized a gain on sale of $52.8 million. The gain reflected the $62.0 million
stated purchase price along with $6.0 million provided in fiscal 2015 by the
buyer to fund operations through completion of the sale, net of $5.4 million
capital gains taxes paid on April 8, 2016 to the Dominican Republic tax
authority, the net assets of Trilogy Dominicana at the closing date and the
transaction costs of $0.9 million incurred in fiscal 2015 to complete the
transaction. Additionally, upon completion of the sale on March 23, 2016, net
operating loss carryforwards of $66.5 million at Trilogy Dominicana as of
December 31, 2015, which were subject to a full valuation allowance, were no
longer available to the Company.

ComCEL Sale:

On March 30, 2012, the Company sold its subsidiary in Haiti,
Communication Cellulaire dHaiti (ComCEL), to a wholly-owned subsidiary of
Digicel Group (Digicel). The Company deposited $8.0 million of the purchase
price into escrow as security for its indemnification obligations under the
purchase agreement. The escrow period terminated in March 2015, at which time
this last tranche of the escrow of $2.1 million was released to the Company and
the Company recognized a gain on disposal of ComCEL of $2.1 million during the
year ended December 31, 2015. For the year ended December 31, 2014, the gain
recognized on disposal of ComCEL was $3.4 million, primarily related to releases
from the escrow account. These gains were included in loss from discontinued
operations in the Consolidated Statements of Operations and Comprehensive Loss.

Assets and liabilities held for sale related to discontinued
operations as of December 31, 2015 were as follows:

December 31, 2015Assets held for sale:Current assets
    $
    9,630Property and equipment, net
    
    15,048Other assets
    
    2,002Total assets
    $
    26,680Liabilities held for sale:Current liabilities
    $
    17,122Noncurrent liabilities
    
    3,749Total liabilities
    $
    20,871


18

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

There were no assets and liabilities related to discontinued
operations as of December 31, 2016. The following table summarizes the results
of operations from the discontinued operations:

|                                                           |   | Years Ended December 31, |  
|---------------------------------------------------------- | - | ------------------------ | -
|                                                           |   | 2016                     |  
|Revenues                                                   | $ | 7,493                    |  
|                                                           |   |                          |  
|Net loss                                                   | $ | (2,489                   | )
|Gain on sale of discontinued operations                    |   | 52,792                   |  
|Gain (loss) from
      discontinued operations, net of tax | $ | 50,303                   |  

The following table summarizes the cash flows from discontinued
operations:

|                                                          |   | Years Ended December 31, |  
|--------------------------------------------------------- | - | ------------------------ | -
|                                                          |   | 2016                     |  
|Net cash provided by (used
      in) operating activities | $ | 223                      |  
|Net cash used in investing activities                     | $ | (490                     | )

No activity from the discontinued operations was recorded after
the sale of Trilogy Dominicana was completed on March 23, 2016.

NOTE 4  PROPERTY AND EQUIPMENT

|                                                  |   | December 31, 2016 |   |   | December 31, 2015 |  
|------------------------------------------------- | - | ----------------- | - | - | ----------------- | -
|                                                  |   |                   |   |   |                   |  
|Land, buildings and
      improvements            | $ | 8,998             |   | $ | 8,500             |  
|Wireless communication systems                    |   | 685,562           |   |   | 607,411           |  
|Furniture, equipment,
      vehicles and software |   | 111,690           |   |   | 104,867           |  
|Construction in progress                          |   | 61,246            |   |   | 48,214            |  
|                                                  |   |                   |   |   |                   |  
|                                                  |   | 867,496           |   |   | 768,992           |  
|Less: accumulated
      depreciation              |   | (473,931          | ) |   | (395,700          | )
|                                                  |   |                   |   |   |                   |  
|Property and equipment, net                       | $ | 393,565           |   | $ | 373,292           |  

Depreciation expense was $85.8 million, $77.1 million and $74.6
million for the years ended December 31, 2016, 2015 and 2014, respectively.

Advances to equipment vendors are included in Other assets and
totaled $6.9 million and $6.8 million as of December 31, 2016 and 2015,
respectively.

AROs are primarily recorded for the Companys legal obligations
to remediate leased property on which the Companys network infrastructure and
related assets are located. The AROs are recorded in Other non-current
liabilities with a corresponding amount in Property and equipment, net. No
obligation is expected to be settled within 12 months as of December 31, 2016.
The activity in the AROs was as follows:

19

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

|                                  |   | Years Ended December 31, |  
|--------------------------------- | - | ------------------------ | -
|                                  |   | 2016                     |  
|Beginning balance                 | $ | 18,878                   |  
|Revisions in estimated cash flows |   | (690                     | )
|Additional accruals               |   | 1,733                    |  
|Foreign currency translation      |   | 132                      |  
|Accretion                         |   | 1,585                    |  
|Disposals                         |   | (45                      | )
|Ending balance                    | $ | 21,593                   |  

The corresponding assets, net of accumulated depreciation,
related to AROs were $10.7 million and $10.6 million as of December 31, 2016 and
2015, respectively.

Supplemental cash flow information:

The Company acquired $1.8 million, $1.1 million and $5.4
million of property and equipment through current and long-term debt during the
years ended December 31, 2016, 2015 and 2014, respectively.

The Company acquires property and equipment through current and
long-term construction accounts payable. The net change in current and long-term
construction accounts payable resulted in additions or (adjustments) to Purchase
of property and equipment on the Consolidated Statements of Cash Flows of $5.6
million, $(11.4) million and $(6.9) million for the years ended December 31,
2016, 2015 and 2014, respectively.

NOTE 5  GOODWILL, LICENSE COSTS AND OTHER INTANGIBLE ASSETS

The following table summarizes the changes in the Companys
goodwill balance:

|                                     |   | December 31, 2016 |  |   | December 31, 2015 |  
|------------------------------------ | - | ----------------- |  | - | ----------------- | -
|                                     |   |                   |  |   |                   |  
|Beginning balance                    | $ | 9,195             |  | $ | -                 |  
|Acquisitions and related adjustments |   | -                 |  |   | 10,028            |  
|Foreign currency adjustment          |   | 99                |  |   | (833              | )
|                                     |   |                   |  |   |                   |  
|Balance at the end of the year       | $ | 9,294             |  | $ | 9,195             |  

There are no accumulated goodwill impairments for the years
ended December 31, 2016 and 2015.

20

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

The Companys license costs and other intangible assets
consisted of the following:

|                         |              |   | December 31, 2016 | 
|------------------------ | ------------ | - | ----------------- | 
|                         | Estimated    |   | Gross Carrying    | 
|                         | Useful Lives |   | Amount            | 
|License costs            | 7 - 20 years | $ | 186,626           | 
|Subscriber relationships | 7 years      |   | 12,937            | 
|Other                    | 6 -14 years  |   | 3,581             | 
|                         |              |   |                   | 
|Total                    |              | $ | 203,144           | 

|                         |              |  |   | December 31, 2015 | 
|------------------------ | ------------ |  | - | ----------------- | 
|                         | Estimated    |  |   | Gross Carrying    | 
|                         | Useful Lives |  |   | Amount            | 
|License costs            | 7 - 20 years |  | $ | 182,859           | 
|Subscriber relationships | 7 years      |  |   | 12,799            | 
|Other                    | 6 -14 years  |  |   | 3,566             | 
|                         |              |  |   |                   | 
|Total                    |              |  | $ | 199,224           | 

Amortization expense was $18.0 million, $14.9 million and $12.7
million for the years ended December 31, 2016, 2015 and 2014, respectively.
Estimated future amortization expense associated with the net carrying amount of
license costs and other intangible assets, based on the exchange rate as of
December 31, 2016, is as follows:

Years ending December 31,2017
    $
    17,6282018
    
    16,9792019
    
    16,2182020
    
    10,3232021
    
    7,349Thereafter
    
    44,557Total
    $
    113,054


Bolivia:

In March 2014, NuevaTel was the successful bidder in the
auction for 30 MHz of 1700/2100 MHz (AWS) band spectrum.

NuevaTel paid $23.0 million for this AWS spectrum in April
2014. The licenses were granted in May 2014 and will be valid for 15 years
through 2029.

New Zealand:On October 29, 2013, Trilogy
International Radio Spectrum LLC, a Delaware limited liability company and
indirect wholly owned subsidiary of the Company (TIRS), entered into an
agreement with the government of New Zealand for the acquisition of a 10 MHz
paired license of 700 MHz spectrum (the 700 MHz License), which expires in
2031, for $44.0 million NZD ($30.4 million based on the exchange rate at
December 31, 2016). TIRS has made this spectrum available to 2degrees, which
will use such spectrum in connection with its provision of future 4G services.

21

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

The acquisition of the 700 MHz License was funded through a
long-term payable from TIRS to the government of New Zealand, and in October
2013, the Company was required to obtain a letter of credit for the ultimate
benefit of the government of New Zealand, which was secured by $5.2 million of
collateral. The first installment on the long-term payable of $10.3 million NZD
($8.2 million based on the exchange rate at the date of payment) was paid in
October 2014 by the Company on behalf of TIRS. Collateral related to the letter
of credit was returned to the Company in November 2014 in connection with the
October 2014 payment. TIRS is obligated to make four additional annual
installment payments along with accrued interest commencing in December 2016.
Interest on the unpaid purchase price accrues at the rate of 5.8% per annum. On
September 14, 2016, Trilogys request to defer the December 2016 annual payment
until March 2017 was granted by the government of New Zealand. In March 2017,
Trilogy paid for that deferred installment, on behalf of TIRS, $10.5 million NZD
($7.3 million based on the exchange rate at the date of payment).

As of December 31, 2016, the outstanding current and long-term
portion of the license obligation for the 700 MHz License recorded in other
current liabilities and accrued expenses and other non-current liabilities was
$10.3 million and $13.0 million, respectively. Future maturities of the license
obligation as of December 31, 2016 are as follows:

Years ending December 31,2017
    $
    10,3002018
    
    6,3392019
    
    6,7062020
    
    -Total
    $
    23,345


The Company designated TIRS as an unrestricted subsidiary under
the indenture for the Companys $450 million principal amount of senior secured
notes due 2016 (the Trilogy 2016 Notes) (see Note 9  Debt). Trilogy
International South Pacific LLC (TISP) is the owner of the equity interests in
TIRS and a wholly-owned subsidiary of the Company. On October 25, 2013, TISP and
2degrees entered into agreements pursuant to which, subject to certain
conditions, 2degrees would have the right to acquire and TISP would have the
right to cause 2degrees to acquire, the capital stock of TIRS in the future
along with assuming the remaining license obligations to the government of New
Zealand. TISP would have this right after September 30, 2016, or earlier if an
acquisition of TIRS and the assumption of its license obligations by 2degrees
would not cause 2degrees to be in violation of any of its covenants under the
2degrees Senior Facilities Agreement or the Huawei Loan (see Note 9  Debt).

On November 3, 2016, the agreement between TISP and 2degrees,
entered on October 25, 2013, was amended to permit 2degrees to prepay, in full
or in part, amounts payable to acquire the capital stock of TIRS. Payments made
under the amended agreement are subject to 2degrees board approval. A prepayment
was made by 2degrees to TISP in the amount of $7.4 million on November 9, 2016
under the amended agreement.

NOTE 6  EIP RECEIVABLES

In New Zealand, the Company offers certain wireless customers
the option to pay for their handset in installments over a period of up to 24
months using an EIP.

22

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

The following table summarizes the unbilled EIP receivables:

|                                                     |   | December 31, 2016 |   |   | December 31, 2015 |  
|---------------------------------------------------- | - | ----------------- | - | - | ----------------- | -
|                                                     |   |                   |   |   |                   |  
|EIP receivables, gross                               | $ | 36,403            |   | $ | 31,393            |  
|Unamortized imputed interest                         |   | (2,327            | ) |   | (1,984            | )
|EIP receivables, net of unamortized imputed interest | $ | 34,076            |   | $ | 29,409            |  
|Allowance for doubtful accounts                      |   | (1,092            | ) |   | (942              | )
|EIP receivables, net                                 | $ | 32,984            |   | $ | 28,467            |  

|Classified on the balance sheet as:                    |   | December 31, 2016 |  |   | December 31, 2015 | 
|------------------------------------------------------ | - | ----------------- |  | - | ----------------- | 
|                                                       |   |                   |  |   |                   | 
|Equipment installment plan
      receivables, net      | $ | 20,246            |  | $ | 16,431            | 
|Long-term equipment installment plan
      receivables |   | 12,738            |  |   | 12,036            | 
|EIP receivables, net                                   | $ | 32,984            |  | $ | 28,467            | 

The Company categorizes unbilled EIP receivables as prime and
subprime based on subscriber credit profiles. Upon initiation of a subscribers
installment plan, the Company uses a proprietary scoring system that measures
the credit quality of EIP receivables using several factors, such as credit
bureau information, subscriber credit risk scores and service plan
characteristics. We periodically assess the proprietary scoring system. Prime
subscriber receivables are those with lower delinquency and eligible for sale to
a third party. Subprime subscribers are those with higher delinquency and those
who are required to participate in a risk mitigation program which includes
paying a deposit and allowing for automatic payments. The balances of EIP
receivables on a gross basis by credit category as of the period presented were
as follows:

|                             |   | December 31, 2016 |  |   | December 31, 2015 | 
|---------------------------- | - | ----------------- |  | - | ----------------- | 
|                             |   |                   |  |   |                   | 
|Prime                        | $ | 28,902            |  | $ | 25,767            | 
|Subprime                     |   | 7,501             |  |   | 5,626             | 
|Total EIP receivables, gross | $ | 36,403            |  | $ | 31,393            | 

The EIP receivables had weighted average imputed interest rates
of 6.93% and 7.5% as of December 31, 2016 and 2015, respectively.

The following table shows changes in the aggregate carrying
amount of the unbilled EIP receivables:

|                                                                     |   | December 31, 2016 |   |   | December 31, 2015 |  
|-------------------------------------------------------------------- | - | ----------------- | - | - | ----------------- | -
|                                                                     |   |                   |   |   |                   |  
|Beginning balance of EIP
      receivables, net                      | $ | 28,467            |   | $ | 7,832             |  
|Additions                                                            |   | 86,167            |   |   | 67,408            |  
|Billings and payments                                                |   | (33,595           | ) |   | (20,397           | )
|Sales of EIP receivables                                             |   | (47,672           | ) |   | (21,955           | )
|Foreign currency translation                                         |   | 110               |   |   | (2,381            | )
|Change in allowance for doubtful accounts and
      imputed interest |   | (493              | ) |   | (2,040            | )
|Total EIP receivables, net                                           | $ | 32,984            |   | $ | 28,467            |  

Sales of EIP Receivables:

In June 2015, 2degrees entered into a mobile handset
receivables purchase agreement (the EIP Sale Agreement) with a third party New
Zealand financial institution (the EIP Buyer). The EIP Sale Agreement provides
an arrangement for 2degrees to accelerate realization of receivables from
wireless customers who purchase mobile phones from 2degrees on installment plans. Under the agreement and on a monthly basis,
2degrees offers to sell specified receivables to the EIP Buyer and the EIP Buyer
may propose a price at which to purchase the receivables. Neither party is
obligated to conclude a purchase, except on mutually agreeable terms. The EIP
Sale Agreement specifies certain criteria for mobile phone receivables to be
eligible for purchase by the EIP Buyer. The Company evaluated the structure and
terms of the arrangement and determined 2degrees has no variable interest with
the EIP Buyer and thus we are not required to consolidate the entity in our
financial statements.

23

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

The Company determined that the sales of receivables through
the arrangement should be treated as sales of financial assets. As such, upon
sale, 2degrees derecognizes the receivables, as well as any related allowance
for doubtful accounts and the loss on sale is recognized in General and
administrative expenses. The Company also reverses unamortized imputed interest
related to sold receivables, included in Equipment installment plan receivables,
net, on the Consolidated Balance Sheets and recognizes the reversed unamortized
imputed interest as Equipment sales. Net cash proceeds are recognized in Net
cash provided by operating activities.

2degrees has continuing involvement with the EIP receivables
sold to the EIP Buyer through a servicing agreement. However, the servicing
rights do not provide 2degrees with any direct economic benefit, or means of
effective control. Further, the EIP Buyer assumes all risks associated with the
purchased receivables and has no recourse against 2degrees except in the case of
fraud or misrepresentation.

The following table summarizes the impact of the sales of the
EIP receivables in the years ended December 31, 2016 and 2015:

|                                                                  |   | December 31, 2016 |   |   | December 31, 2015 |  
|----------------------------------------------------------------- | - | ----------------- | - | - | ----------------- | -
|                                                                  |   |                   |   |   |                   |  
|EIP receivables derecognized                                      | $ | 47,672            |   | $ | 21,955            |  
|Cash proceeds (gross of initial legal and
      bank set-up fees) |   | (41,338           | ) |   | (18,827           | )
|Reversal of unamortized
      imputed interest                    |   | (3,393            | ) |   | (1,535            | )
|Reversal of allowance for doubtful accounts                       |   | (1,430            | ) |   | (659              | )
|Pre-tax loss on sales of EIP
      receivables                    | $ | 1,511             |   | $ | 934               |  
|Initial legal and bank set-up fees                                | $ | -                 |   | $ | 1,175             |  

NOTE 7  OTHER CURRENT LIABILITIES AND ACCRUED EXPENSES

|                                                          |   | December 31, 2016 |  |   | December 31, 2015 | 
|--------------------------------------------------------- | - | ----------------- |  | - | ----------------- | 
|                                                          |   |                   |  |   |                   | 
|Payroll and employee benefits                             | $ | 18,556            |  | $ | 16,868            | 
|Dealer commissions and subsidies                          |   | 17,883            |  |   | 15,030            | 
|Value-added tax and other
      business taxes            |   | 17,137            |  |   | 14,404            | 
|Interest payable                                          |   | 12,370            |  |   | 20,879            | 
|Interconnection and roaming
      charges payable         |   | 12,364            |  |   | 10,980            | 
|Handset purchases                                         |   | 11,650            |  |   | 9,416             | 
|Current portion of license
      obligation               |   | 10,300            |  |   | 4,263             | 
|Income and withholding taxes                              |   | 8,822             |  |   | 13,452            | 
|Unearned proceeds on disposal
      of Trilogy Dominicana |   | -                 |  |   | 27,000            | 
|Other                                                     |   | 19,725            |  |   | 19,408            | 
|                                                          |   |                   |  |   |                   | 
|Other current
      liabilities and accrued expenses      | $ | 128,807           |  | $ | 151,700           | 

24

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

NOTE 8  FAIR VALUE MEASUREMENTS

The accounting guidance for fair value established a framework
for measuring fair value and established a three-level valuation hierarchy for
disclosure of fair value measurement. The valuation hierarchy is based upon the
transparency of inputs to the valuation of an asset or liability at the
measurement date. The three levels are defined as follows:

| | Level 1  Quoted prices in active markets for identical
      assets or liabilities;                                                                                                                          
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                               
| | Level 2  Inputs other than quoted prices included within
      Level 1 that are either directly or indirectly observable;                                                                                    
|  |                                                                                                                                                                                                               
| | Level 3  Unobservable inputs in which little or no
      market activity exists, requiring an entity to develop its own assumptions
      that market participants would use to value the asset or liability.

The following table presents assets and liabilities measured at
fair value on a recurring basis at December 31, 2016 and 2015, all of which
represent Level 2 fair value measurements:

|                           |   | December 31, 2016 |  |   | December 31, 2015 | 
|-------------------------- | - | ----------------- |  | - | ----------------- | 
|                           |   |                   |  |   |                   | 
|Assets:                    |   |                   |  |   |                   | 
|                           |   |                   |  |   |                   | 
|Forward exchange contracts | $ | 1,145             |  | $ | -                 | 
|                           |   |                   |  |   |                   | 
|Total assets               | $ | 1,145             |  | $ | -                 | 
|                           |   |                   |  |   |                   | 
|Liabilities:               |   |                   |  |   |                   | 
|Interest rate swaps        | $ | 1,984             |  | $ | 3,112             | 
|Forward exchange contracts |   | -                 |  |   | 399               | 
|                           |   |                   |  |   |                   | 
|Total liabilities          | $ | 1,984             |  | $ | 3,511             | 

The fair value of interest rate swaps are measured using quotes
obtained from a financial institution for similar financial instruments. The
fair value of forward exchange contracts is based on the differential between
the contract price and foreign currency exchange rate as of the balance sheet
date.

There were no transfers between levels within the fair value
hierarchy during the years ended December 31, 2016 and 2015.

Cash and cash equivalents, accounts receivable, deposits,
accounts payable and accrued expenses are carried at cost, which approximates
fair value given their short-term nature.

The estimated fair value of the Companys debt, including
current maturities, was based on Level 2 inputs, being market quotes or values
for similar instruments, and interest rates currently available to the Company
for the issuance of debt with similar terms and remaining maturities as a
discount rate for the remaining principal payments. The carrying amounts and
estimated fair values of our total debt as of December 31, 2016 and 2015 were as
follows:

|                                                                                   |   | December 31, 2016 |  |   | December 31, 2015 | 
|---------------------------------------------------------------------------------- | - | ----------------- |  | - | ----------------- | 
|                                                                                   |   |                   |  |   |                   | 
|Carrying amount, excluding
      unamortized discount and deferred financing costs | $ | 609,644           |  | $ | 602,089           | 
|Fair value                                                                         | $ | 616,168           |  | $ | 589,783           | 

For fiscal year 2016 and 2015, we did not record any material
other-than-temporary impairments on financial assets and liabilities required to
be measured at fair value on a nonrecurring basis.

25

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

NOTE 9  DEBT

The Companys long-term and other debt as of December 31, 2016
and 2015 consisted of the following:

|                                        |   | December 31, 2016 |   |   | December 31, 2015 |  
|--------------------------------------- | - | ----------------- | - | - | ----------------- | -
|                                        |   |                   |   |   |                   |  
|Trilogy Notes                           | $ | 450,000           |   | $ | 450,000           |  
|New Zealand Senior Facilities Agreement |   | 133,101           |   |   | 134,321           |  
|Bolivian Syndicated Loan                |   | 23,158            |   |   | 13,351            |  
|Other                                   |   | 3,385             |   |   | 4,417             |  
|                                        |   | 609,644           |   |   | 602,089           |  
|Less: unamortized discount              |   | (3,931            | ) |   | (669              | )
|Less: deferred financing
      costs    |   | (5,766            | ) |   | (5,227            | )
|Total debt                              |   | 599,947           |   |   | 596,193           |  
|Less: current portion of debt           |   | (8,796            | ) |   | (465,768          | )
|Total
      long-term debt              | $ | 591,151           |   | $ | 130,425           |  

As of December 31, 2016, the future maturities of long-term and
other debt, excluding unamortized debt discounts and deferred financing costs,
consisted of the following:

|Years ending December 31, |   |         | 
|------------------------- | - | ------- | 
|2017                      | $ | 8,796   | 
|2018                      |   | 133,306 | 
|2019                      |   | 456,945 | 
|2020                      |   | 6,825   | 
|2021                      |   | 3,430   | 
|Thereafter                |   | 342     | 
|                          |   |         | 
|Total                     | $ | 609,644 | 

Trilogy 2016 Notes:

On August 10, 2010, the Company issued Trilogy 2016 Notes in
the aggregate principal amount of $370 million due August 2016 in an offering
exempt from registration under Rule 144A and Regulation S under the Securities
Act of 1933, as amended (the Securities Act). In April 2014, the Company
issued and sold $80.0 million principal amount of additional Trilogy 2016 Notes
at 99.5% of the principal amount thereof. The issuance of the additional $80.0
million was consented to by the holders of the Trilogy 2016 Notes and effected
through an amendment to the indenture for the Trilogy 2016 Notes. Proceeds of
$78.0 million, net of a commitment fee of 2% paid to the Trilogy 2016 Notes
purchasers, were received by the Company on April 7, 2014. Terms of the
additional Trilogy 2016 Notes were substantially identical with those of the
originally issued Trilogy 2016 Notes. Separately, a consent fee of $0.9 million
was paid to the existing note holders, all of whom consented to the above
described amendment to the Trilogy 2016 Notes indenture.

The Trilogy 2016 Notes bore interest at a rate of 10.25% per
year, payable semi-annually on February 15 and August 15 of each year.

Refinancing of Trilogy 2016 Notes:

On April 26, 2016, the Company entered into a purchase
agreement with Deutsche Bank Securities Inc. (the Initial Purchaser) pursuant
to which the Company agreed to issue and sell to the Initial Purchaser $450
million aggregate principal amount of senior secured notes, in an offering (the Offering)
to qualified institutional buyers pursuant to Rule 144A under the Securities Act
and to non-U.S. persons in offshore transactions in reliance on Regulation S
under the Securities Act. The sale of the senior secured notes (the Trilogy
2019 Notes) was funded on May 6, 2016.

26

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

The proceeds of $445.5 million, net of discount of $4.5
million, were used to fund the Companys April 22, 2016 offer to purchase any
and all of the previously outstanding Trilogy 2016 Notes (the Tender Offer)
and to discharge any Trilogy 2016 Notes that remained outstanding following the
Tender Offer. On May 6, 2016, the Company accepted and paid $444.1 million
principal amount for tendered Trilogy 2016 Notes pursuant to the Tender Offer at
a price of $1,008.50 per $1,000 principal amount, plus accrued interest (the
Early Tender Premium). The Early Tender Premium of $3.8 million was recorded
as a deferred financing cost of the Trilogy 2019 Notes in the second quarter of
2016 and is included in Long-term debt in the Consolidated Balance Sheet. The
Early Tender Premium and the unamortized balance of the deferred financing costs
associated with the Trilogy 2016 Notes are amortized using the effective
interest method over the term of the Trilogy 2019 Notes.

The Tender Offer expired on May 19, 2016, with no additional
Trilogy 2016 Notes tendered. On May 6, 2016, the Company issued a notice of
redemption at par plus accrued interest with respect to the $5.9 million of
Trilogy 2016 Notes which remained outstanding and on June 5, 2016, paid $6.1
million to the indenture trustee to redeem such outstanding Trilogy 2016 Notes,
plus accrued interest.

The refinancing of the Trilogy 2016 Notes was accounted for as
a modification in accordance with the applicable accounting guidance. The total
fees paid to third parties in connection with the modification were $3.8 million
which we expensed in fiscal 2016. The Trilogy 2019 Notes mature May 15, 2019 and
bear interest at a rate of 13.375% per year, payable semi-annually on May 15 and
November 15 of each year, which commenced November 15, 2016.

The Company has the option of redeeming the Trilogy 2019 Notes,
in whole but not in part, upon not less than 30-days and not more than 60-days
notice as follows:

- Prior to November 15, 2016, at 100% plus a "make whole" premium
- On or after November 15, 2016 but prior to May 15, 2017, at 106.688%
- On or after May 15, 2017, at 100%

On or after May 15, 2017, the Company may redeem up to 35% of
the original outstanding principal amount at 100% with the proceeds of a public
equity offering. Upon election of any early redemption option, the Company is
required to pay accrued and unpaid interest on the Trilogy 2019 Notes being
redeemed.

In connection with the transaction described below in the
liquidity section with Alignvest Acquisition Corporation, an Ontario, Canada
special purpose acquisition corporation (Alignvest), pursuant to an
Arrangement Agreement dated as of November 1, 2016 (as amended, the Arrangement
Agreement), the Company and the holders of the Trilogy 2019 Notes agreed to
amend the indenture for the Trilogy 2019 Notes, among other things, (i) to
permit the Company to consummate the Arrangement Agreement and the transactions
to be entered into in connection therewith without such Arrangement Agreement
and related transactions constituting a Change of Control under the indenture,
and (ii) to permit Alignvest, on the one hand, and the Company and its
Subsidiaries, on the other hand, to enter into certain transactions from and
after the consummation of the Arrangement Agreement. The Company and the Trustee
under the indenture executed a First Supplemental Indenture setting forth such
amendments. Such First Supplemental Indenture became binding and effective on
November 22, 2016 upon execution by the Company, the Trustee and the guarantors
thereunder, and became operative upon the closing of the Arrangement Agreement,
from such date of execution, upon the confirmation to the Trustee that the
Arrangement Agreement had been consummated and that Alignvest and/or certain
other affiliates of the Company invested in the aggregate a minimum of $125
million in the Company since November 1, 2016 or in connection with the
consummation of the Arrangement Agreement. The First Supplemental Indenture also
contains a covenant requiring the Company to set aside not less than $125
million of the cash invested by Alignvest and/or the affiliates of the Company
since November 1, 2016 or in connection with the consummation of the Arrangement
solely for use to prepay, repurchase, redeem or otherwise acquire Trilogy 2019
Notes or to pay interest thereon, and requiring the Company to use commercially
reasonable efforts to, by no later than July 31, 2017, use at least $125 million
to either (i) prepay, repurchase, redeem, or otherwise acquire Trilogy 2019
Notes or (ii) pay interest on the Trilogy 2019 Notes that is scheduled to be
paid between the closing date of the Alignvest transaction and July 31, 2017. Upon consummation of
the Arrangement Agreement, the Company set aside a minimum of $125.0 million as
required by the First Supplement Indenture.

27

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

The Trilogy 2019 Notes are secured by a first priority lien on
the equity interests of certain of the Companys direct wholly owned domestic
subsidiaries. Certain categories of intercompany and third party indebtedness
owed to the Company or its subsidiaries must also be pledged to secure the
Trilogy 2019 Notes; however, there are no such forms of indebtedness subject to
the pledge requirement as of December 31, 2016. The indenture governing the
Trilogy 2019 Notes contains various covenants that restrict, among other things:
incurring additional indebtedness, repaying other indebtedness prior to
maturity, making acquisitions or investments (including in certain of our
subsidiaries), creating or incurring certain liens, transferring or selling
certain assets, entering into transactions with affiliates, and entering into
mergers or consolidations.

Senior Facilities Agreement:

In June 2013, 2degrees entered into a Senior Facilities
Agreement (as amended, the Senior Facilities Agreement) with Bank of New
Zealand (BNZ), pursuant to which BNZ agreed to provide financing of up to $150
million NZD, such availability to be based in part upon 2degrees EBITDA (as
defined in the Senior Facilities Agreement) for the prior twelve months. In
March 2014, additional financial institutions (together with BNZ, the Banks)
provided commitments under the Senior Facilities Agreement, which increased the
amount of potential financing to $165 million NZD. In January 2015, the Senior
Facilities Agreement was amended to include an additional commitment to fund
2degrees capital expenditures in the amount of $20 million NZD, provided that
until 2degrees credit facility (the Huawei Loan) with Huawei Technologies
(New Zealand) Company Limited (Huawei) was repaid in full, all such capital
expenditures had to be incurred with Huawei or any of its related entities. The
Huawei Loan was fully repaid in May 2015. With this additional commitment, the
total amount of potential financing increased to $185 million NZD.

In August 2015, 2degrees entered into an agreement with the
existing members of the Senior Facilities Agreement to refinance the $185
million NZD facility and provide an additional commitment of $15 million NZD for
a total of $200 million NZD of potential financing ($138.4 million based on the
exchange rate at December 31, 2016). Separate facilities are provided under the
agreement to repay the existing outstanding balance and fund 2degrees capital
expenditures ($185 million NZD) and to fund 2degrees working capital
requirements ($15 million NZD). As of December 31, 2016, the $185 million NZD
($128.0 million based on the exchange rate at December 31, 2016) facility was
fully drawn-down, and $7.4 million NZD ($5.1 million based on the exchange rate
at December 31, 2016) was drawn on the $15 million NZD working capital facility.
The borrowings and repayments for these facilities, including the recurring
activity to fund working capital requirements, are included separately as
Proceeds from debt and Payments of debt within Net cash provided by financing
activities in the Consolidated Statements of Cash Flows.

The debt under the Senior Facilities Agreement accrues interest
payable quarterly at a rate ranging from 1.15% to 2.05% (depending upon
2degrees senior leverage ratio at that time) plus the New Zealand Bank Bill
Reference Rate (BKBM). Additionally, a line fee of between 0.75% and 1.35%
(depending upon 2degrees senior leverage ratio at that time) calculated on the
total committed financing under the Senior Facilities Agreement (both drawn and
undrawn) is also payable quarterly. The Senior Facilities Agreement maturity
date is June 30, 2018. However, once a year, beginning on January 1, 2016, at
least six months apart, for a period of not less than five consecutive days,
2degrees must reduce the outstanding balance of the $15 million NZD facility
used to fund its working capital requirements to zero. As of December 31, 2016,
the line fee rate was 0.95% . The effective interest rate (weighted average
interest rate plus line fee) on the combined balance of the facilities
outstanding as of December 31, 2016 and December 31, 2015 was 4.68% and 6.02%,
respectively.

The Senior Facilities Agreement contains certain financial
covenants requiring 2degrees to:

- maintain a total interest coverage ratio of not less than 3.0 times;
- maintain a senior leverage ratio of not greater than 3.0 times; and
- not exceed 110% of the agreed to annual capital expenditures in any
  financial year.

The Senior Facilities Agreement also contains other customary
representations, warranties, covenants and events of default. The Senior
Facilities Agreement is secured (in favor of an independent security trustee) by
substantially all of the assets of 2degrees, including the 700 MHz License
Trilogy acquired on behalf of 2degrees in January 2013.

28

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

Bolivian Syndicated Loan:

In April 2016, NuevaTel entered into a $25 million debt
facility (the Bolivian Syndicated Loan) with a consortium of Bolivian banks.
The net proceeds were used to fully repay the then outstanding balance of the
previously outstanding loan agreement and the remaining proceeds were used for
capital expenditures. The Bolivian Syndicated Loan is required to be repaid in
predetermined quarterly installments which commenced in 2016 and will end in
2021, with 10% of the principal amount to be repaid during each of the first two
years of the Bolivian Syndicated Loan and 26.67% of the principal amount to be
repaid during each of the final three years. Interest on the Bolivian Syndicated
Loan accrues at a fixed rate of 7.0% for the first 12 months and thereafter at a
variable rate of 5.5% plus Tasa de Referencia. Interest is payable on a
quarterly basis. At December 31, 2016, the interest rate was 7.0% . The
outstanding balance of the current and long-term portion of the Bolivian
Syndicated Loan was $1.9 million and $21.3 million, respectively, as of December
31, 2016.

The Bolivian Syndicated Loan agreement contains certain
financial covenants requiring NuevaTel to maintain:

- an indebtedness ratio (as defined in the Bolivian Syndicated Loan
  agreement) of not greater than 2.15 times;
- a debt coverage ratio (as defined in the Bolivian Syndicated Loan
  agreement) of not less than 1.25 times;
- a current ratio (as defined in the Bolivian Syndicated Loan agreement) of
  not less than 0.65 times; and
- a structural debt ratio (as defined in the Bolivian Syndicated Loan
  agreement) of not higher than 3.0 times.

Substantially all of NuevaTels assets are pledged as
collateral to secure the Bolivian Syndicated Loan.

Covenants:

As of December 31, 2016, the Company was in compliance with all
of its debt covenants.

Interest Cost Incurred:

Consolidated interest cost incurred and expensed, prior to
capitalization of interest, was $70.7 million, $63.4 million and $63.4 million
for the years ended December 31, 2016, 2015 and 2014, respectively.

Supplemental Cash Flow Disclosure:

|                                                 |   | Years Ended December 31, | 
|------------------------------------------------ | - | ------------------------ | 
|                                                 |   |                          | 
|                                                 |   | 2016                     | 
|                                                 |   |                          | 
|Interest paid, net of
      capitalized interest | $ | 73,067                   | 

Deferred Financing Costs:

Deferred financing costs represent incremental direct costs of
debt financing and are included in Long-term debt. As of December 31, 2016 and
2015, the balances were $5.8 million and $5.2 million, respectively. These costs
are amortized using the effective interest method over the term of the related
credit facilities. Amortization of deferred financing costs is included in
interest expense and totaled $3.3 million, $4.5 million and $4.7 million for the
years ended December 31, 2016, 2015 and 2014, respectively.

Liquidity:

As of December 31, 2016, the Company had approximately $21.2
million in cash and cash equivalents. For the year ended December 31, 2016, the
net income attributable to Trilogy was $2.1 million and cash flow provided by
operating activities was $49.0 million. The Company had negative working capital
of $63.8 million as of December 31, 2016. The current and historical operating
cash flows, current cash and working capital balances, and forecasted
obligations of the Company were considered in connection with managements
evaluation of the Companys ongoing liquidity.

29

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

On November 1, 2016, the Company and Alignvest, whose Class A
restricted voting shares and warrants were listed on the Toronto Stock Exchange,
announced that they had entered into the Arrangement Agreement to effect a
business combination transaction. The transaction was completed on February 7,
2017 in accordance with the Arrangement Agreement, and the Company received
$199.3 million of cash in connection with the closing of the transaction. The
cash resources received from the transaction are expected to provide funding for
investment in network assets and to provide capital sufficient to meet ongoing
obligations. In addition, the Company intends to seek to refinance the Trilogy
Notes during 2017 with a combination of cash on hand and newly issued
indebtedness. Trilogy plans to meet with certain holders of the Trilogy Notes
and new prospective investors to discuss a possible refinancing. Trilogy will
then assess whether investor interest, general market conditions, and the
Companys own business priorities indicate that a refinancing can be undertaken
on satisfactory terms and, if so, whether it should proceed with a
refinancing.

NOTE 10 DERIVATIVE FINANCIAL INSTRUMENTS

Cross-Currency Swap:

On April 5, 2011, we entered into a cross-currency swap
designated as a cash flow hedge to exchange USD-denominated debt under the
Huawei Loan into NZD in order to fix our future principal payments in NZD, as
well as mitigate the impact of foreign currency transaction gains or losses.
Under this contract, we had fixed the related future interest payments. We
received a variable amount based on LIBOR plus a spread of 4.10% and paid a
fixed amount based on a rate of 13.41% . The variable interest rate calculation
was reset two days prior to each quarterly calculation period. In November 2014,
we terminated the cross-currency swap and replaced the instrument with an
interest rate swap (see below for details), the primary terms of which are
unchanged. In 2013, the Company discontinued hedge accounting and began to
recognize all changes in the fair value of the cross-currency swap in Other,
net. The effective portion of the loss recorded in Accumulated other
comprehensive income (loss) prior to de-designation (see Note 15 - Accumulated
Other Comprehensive Income) will be amortized to Other, net over the remaining
life of the interest rate swap agreement. The amount reclassified from
Accumulated other comprehensive income (loss) to Other, net was a loss of $0.5
million and $0.9 for the years ended December 31, 2016 and 2015, respectively.

Summarized financial information for the terminated
cross-currency swap is shown below for the year ended December 31, 2014:

|Non-cash gain/(loss) from change in fair
      value recorded in other, net   | $ | 358    |  
|----------------------------------------------------------------------------- | - | ------ | -
|Gain/(loss) reclassified from comprehensive income (loss)
      to other, net | $ | (1,205 | )
|Net cash settlement                                                           | $ | (3,023 | )

Interest Rate Swaps:

2degrees enters into various interest rate swap agreements to
fix its future interest payments under the Senior Facilities Agreement (see Note
9 - Debt). Under these agreements, 2degrees principally receives a variable
amount based on the BKBM and pays a fixed amount based on fixed rates ranging
from 2.290% to 4.765% . Settlement in cash occurs quarterly until termination
and the variable interest rate is reset on the first day of each calendar
quarter. These derivative instruments have not been designated for hedge
accounting, thus changes in the fair value will be recognized in earnings in the
period incurred. The fair value of these contracts was $1.8 million and $2.1
million as of December 31, 2016 and 2015, respectively. As of December 31, 2016,
the total notional amount of these agreements was $155 million NZD. The
agreements have effective dates from March 31, 2014 through June 30, 2019 and
termination dates from June 30, 2017 to June 30, 2021.

On April 5, 2011, the Company entered into a domestic interest
rate swap originally designated as a cash flow hedge to fix future interest
payments on the NZD-denominated credit under the Huawei Loan (see Note 9 -
Debt). Under this swap agreement, we principally receive a variable amount based
on the BKBM rate and pay a fixed amount of 9.61% based on 5.51% plus the 4.10%
rate premium stated in the Huawei Loan. The variable interest rate calculation
is reset on the first day of each calendar quarter. The fair value of this
contract was approximately $0.1 million and $0.3 million at December 31, 2016
and December 31, 2015, respectively, and is included in Other current
liabilities and accrued expenses. As of December 31, 2016, the total notional
amount of this interest rate swap was $6.0 million NZD, or $4.2 million using
the exchange rate at that date. In 2013, the Company discontinued hedge
accounting and began to recognize all changes in the fair value of the interest
rate swap in Other, net. The effective portion of the loss recorded in
Accumulated other comprehensive income (loss) prior to de-designation (see Note 15 - Accumulated Other
Comprehensive Income) will be amortized to Other, net over the remaining life of
the interest rate swap agreement.

30

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

As of December 31, 2016, the total notional amount of the new
interest rate swap which replaced the cross-currency swap terminated in November
2014 was $6.5 million NZD, or $4.5 million using the exchange rate at that date.
Under this agreement, we receive a variable amount based on BKBM plus a spread
of 4.10% and pay a fixed amount based on a rate of 13.41% . The variable
interest rate calculation is reset on the first day of each quarterly
calculation period. The fair value of this swap, included in Other current
liabilities and accrued expenses, was approximately $0.1 million and $0.7
million at December 31, 2016 and 2015, respectively.

Summarized financial information for all of the aforementioned
interest rate swaps is shown below:

|                                                                              |   | Years Ended December 31, |  
|----------------------------------------------------------------------------- | - | ------------------------ | -
|                                                                              |   | 2016                     |  
|                                                                              |   |                          |  
|Non-cash (loss)/gain from change in fair
      value recorded in other, net   | $ | (750                     | )
|                                                                              |   |                          |  
|(Loss)/gain reclassified from comprehensive
      income (loss) to other, net | $ | (217                     | )
|                                                                              |   |                          |  
|Net cash settlement                                                           | $ | (1,836                   | )

The Company had $1.0 million pledged as collateral for the
interest rate swap contracts as of December 31, 2016. This restricted cash is
included in Prepaid expenses and other current assets on our Consolidated
Balance Sheet as of December 31, 2016. The Company had $1.8 million pledged as
collateral for the interest rate swap contracts as of December 31, 2015. This
restricted cash was included in Other assets on our Consolidated Balance Sheet
as of December 31, 2015.

Under the terms of the interest rate swaps, we are exposed to
credit risk in the event of non-performance by the other parties; however, we do
not anticipate the non-performance of any of our counterparties. For instruments
in a liability position, we are also required to consider our own risk of
non-performance; the impact of such is not material. Further, our interest rate
swaps do not contain credit rating triggers that could affect our liquidity.

In January 2017, we terminated the Companys domestic interest
rate swap agreements discussed above, and the collateral balance of $1.0 million
was returned to the Company.

Forward Exchange Contracts:

At December 31, 2016, 2degrees had various short-term forward
exchange contracts to sell $36.9 million NZD and buy $26.6 million and $0.2
million Euros to manage exposure to fluctuations in foreign currency exchange
rates. These derivative instruments have not been designated for hedge
accounting, thus changes in the fair value will be recognized in earnings in the
period incurred. During the year ended December 31, 2016, a foreign exchange
gain of $1.6 million was recognized in Other, net. The Company had assets,
included in Prepaid expenses and other current assets on the Consolidated
Balance Sheets, for estimated settlements under these forward exchange contracts
of $1.1 million as of December 31, 2016. During the year ended December 31,
2015, a foreign exchange loss of $1.2 million was recognized in Other, net. The
Company had liabilities, included in Other current liabilities and accrued
expenses on the Consolidated Balance Sheets, for estimated settlements under
these forward exchange contracts of $0.4 million as of December 31, 2015.

31

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

NOTE 11  MEZZANINE EQUITY

Three Class A Unit holders (Class A Unit Holders) with a
combined unit holding of 73,590 Class A Units have been granted additional
rights to cause Trilogy to repurchase their Class A Units as follows:

- These three Class A Unit Holders have the right, prior to the occurrence of
  an initial public offering (IPO), to request that the Company elect, in the
  Companys sole discretion, to use commercially reasonable best efforts to
  effect one of the following transactions within 12 months of the Class A Unit
  Holders request: (i) repurchase the Class A Unit Holders outstanding units
  at fair market value; (ii) cause an IPO to occur; or (iii) enter into a
  binding agreement to sell the Company.
- If an IPO has not occurred prior to the sale of substantially all of the
  assets of or more than 50% of the outstanding equity interest in 2degrees, two
  of these three Class A Unit Holders have the option to require the Company to
  purchase as many of the Class A Unit Holders outstanding Company units as
  equal to (i) the net proceeds received from the sale of 2degrees divided by
  (ii) the fair market value of the Class A Units.

The Class A Unit redemption rights were effected in the Fifth
Amended and Restated LLC Agreement among Trilogy International Partners LLC and
its members. The Company has recorded these Class A Units in the mezzanine
section of the accompanying consolidated balance sheets and not members equity
(deficit) because the redemption of these Class A Units are not exclusively in
the Companys control. The Class A Unit rights became redeemable based on the
following schedule:

|                                              |  | Redeemable    | 
|--------------------------------------------- |  | ------------- | 
|Date when redemption right became exercisable |  | Class A Units | 
|                                              |  |               | 
|July 30, 2014                                 |  | 48,590        | 
|December 24, 2015                             |  | 25,000        | 
|Total redeemable units                        |  | 73,590        | 

The Class A units included within mezzanine equity were
recorded at fair value on the date of issuance and have been adjusted to the
greater of their carrying amount or redemption value as of December 31, 2016 and
2015.

NOTE 12  MEMBERS INTEREST

Units Authorized, Issued and Outstanding:

As of December 31, 2016, the Company was authorized to issue up
to 208,617 Class A Units, 141,496 Class B Units, and 15,321 Class C Units. The
Company has two classes of units: Member units and Profit interest units. Member
units include Class A and B units which are issued in exchange for capital
contributions (hereafter the Member group). Profit interest units consist of
Class C Units which are issued to employees or independent contractors in
exchange for performing services (hereafter the Profit group). As of December
31, 2016, 206,892 Class A Units, 141,496 Class B Units and 12,981 Class C units
were issued and outstanding. Losses are allocated to Class A and B unit members
based on their respective unit percentage. The Class C Units are treated as
profit interests, meaning they do not participate in losses. Profits are shared
across the unit holders based on unit percentage across Class A, B and C units,
once losses allocated to Class A and B unit members are recovered.

In connection with the Arrangement Agreement, SG Enterprises II
(SG Enterprise), an entity owned and controlled by John Stanton and Theresa
Gillespie, related parties of Trilogy, subscribed for additional Class A Units
of Trilogy for approximately $5 million. The contribution was received by
Trilogy in November 2016.

32

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

Voting Rights:

The Class A Units have one vote per Class A Unit. Class B Units
have ten votes per Class B Unit. The Class C Units have no voting rights.

Conversion

Class B units may be converted to Class A Units on a one to one
basis at any time and from time to time at the option of the holder thereof upon
written notice of such holder to the Company listing the number of Class B units
to be converted. Class A units and Class C Units are not convertible. All unit
members are subject to drag along rights which require automatic participation
by all unit members in any transaction that is approved by one or more members
owning units constituting 50% or greater of the voting rights of the total
outstanding Class A and B Units.

Distribution & Liquidation Rights:

The following summarizes the hierarchy of distributions among
the debt and equity holders of the Company in the event of liquidation:

| | Debt holders receive their outstanding balance on debt;                                                                         
|- | --------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                 
| | Distributions will be made among the equity holders in
      proportion to the number of Units held by each member, except that:

| |  | No distributions will be made with respect to any Class C
      Units until the Class A Units and Class B Units have received, on a
      per-Unit basis, distributions equal to a predetermined Threshold Amount
      that is assigned to each Class C Unit. For Class C Units issued before
      2008 (Original Class C Units), the Threshold Amount is $1,250 per Unit.
      For Class C Units issued during or after 2008, the Threshold Amount is
      $1,073 per Unit;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |  | Until distributions among the Class A Units and Class B
      Units have reached the Threshold Amount for a Class C Unit, amounts that
      would otherwise be distributable with respect to that Unit will instead be
      distributed among the Class A Units and Class B Units; and                                                                                                                                                                                            
| |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| |  | Once distributions among the Class A Units and Class B
      Units have reached the Threshold Amount of $1,250 per Unit for the
      Original Class C Units, the Original Class C Units will receive a priority
      distribution of $250 per Unit from amounts that would otherwise be
      distributable among the Class A Units and Class B Units.                                                                                                                            

NOTE 13  EQUITY-BASED COMPENSATION AND PAYMENTS

2degrees Option Plans:2degrees awards
service-based share options (the Options) to employees under various plans
(the 2degrees Option Plan) whose vesting is subject to meeting a required
service period of up to three years. Approximately 30.0 million non-voting
ordinary shares of 2degrees common stock were authorized for issuance related to
the 2degrees Option Plan of which 26.4 million options granted and outstanding
are classified as equity awards and are valued based on the fair value of the
underlying 2degrees shares at the date of grant. The remaining 3.6 million
options granted and outstanding under the 2degrees Option Plan are
liability-classified awards as the Option holders have the right to require
2degrees to repurchase exercised Options for cash equal to the fair value at the
date of repurchase. As such, the liability is remeasured each reporting period
based on the fair value of the underlying 2degrees shares at each balance sheet
date. At December 31, 2016 and 2015, the liability-classified awards of $2.9
million and $1.9 million, respectively, are included in Other current
liabilities and accrued expenses on the Consolidated Balance Sheets, due to the
current nature of these instruments.

The following table summarizes the range of assumptions used in
the Black-Scholes model for options granted in the years ended December 31,
2016, 2015 and 2014.

33

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

|                         | 2016        |  | 2015          |  | 2014         
|------------------------ | ----------- |  | ------------- |  | -------------
|Expected term (in years) | 2.82 - 4.32 |  | 3.03 - 4.79   |  | 3.15 - 5.00  
|Risk free interest rate  | 3.01%       |  | 2.99% - 3.01% |  | 2.99% - 3.01%
|Volatility               | 25%         |  | 25%           |  | 30%          
|Dividend yield           | 0%          |  | 0%            |  | 0%           

The expected term of the Options was determined based upon the
historical experience of similar awards, giving consideration to the contractual
terms, vesting schedules and expectations of future option holder behavior. The
risk-free interest rates used were based on the implied yield currently
available in New Zealand Government bonds, adjusted for semi-annual coupons and
converted to continuously compounded rates, at maturity with a term equivalent
to the remaining life of the Options as of the date of the valuation. Expected
volatility was based on average volatilities of publicly traded peer companies
over the expected term. 2degrees has not paid dividends in the past and does not
currently have plans to pay dividends.

The following table provides the outstanding Options as of
December 31, 2016 and the changes in the period:

|                                 |  |            |   |   |                |  |  | Weighted-        |  |   |           | 
|-------------------------------- |  | ---------- | - | - | -------------- |  |  | ---------------- |  | - | --------- | 
|                                 |  |            |   |   | Weighted-      |  |  | Average          |  |   |           | 
|                                 |  |            |   |   | Average        |  |  | Remaining        |  |   | Aggregate | 
|                                 |  |            |   |   | Exercise       |  |  | Contractual Term |  |   | Intrinsic | 
|                                 |  | Options    |   |   | Price per Unit |  |  | (in years)       |  |   | Value     | 
|Outstanding at December 31, 2015 |  | 26,986,045 |   | $ | 1.24           |  |  |                  |  |   |           | 
|Granted                          |  | 5,650,000  |   |   | 1.56           |  |  |                  |  |   |           | 
|Forfeited                        |  | (55,000    | ) |   | 1.42           |  |  |                  |  |   |           | 
|Redeemed                         |  | (2,575,000 | ) |   | 1.00           |  |  |                  |  |   |           | 
|Outstanding at December 31, 2016 |  | 30,006,045 |   | $ | 1.31           |  |  | 3.8              |  | $ | 14,620    | 
|                                 |  |            |   |   |                |  |  |                  |  |   |           | 
|Exercisable at December 31, 2016 |  | 21,131,045 |   | $ | 1.23           |  |  | 2.8              |  | $ | 11,941    | 

The weighted-average grant date fair value of options granted
during the years 2016, 2015 and 2014 were $0.39, $0.35 and $0.33, respectively.
The total intrinsic value of options redeemed or exercised during the years
ended December 31, 2016 and 2015 were $1.2 million and $0.2 million,
respectively. There were no options exercised or redeemed during the year ended
December 31, 2014.

Certain participants were required to make a partial payment
from $0.01 to $0.10 per share (depending on the plan) at the date of grant,
which is fully refundable upon forfeiture of the related Options. 2degrees
retains the partial payments as a liability until such Options are exercised.
The liability of $0.3 million and $0.4 million as of December 31, 2016 and
December 31, 2015, respectively, is included in Other current liabilities and
accrued expenses on the Consolidated Balance Sheets.

During 2014, the Board of Directors of 2degrees and the holder
of the then 4.3 million liability-classified awards agreed to terms to settle
those options for $1.3 million, which approximated the intrinsic value of those
awards. Of the $1.3 million, $0.8 million has been paid and remaining payment is
expected to occur in 2017. The balance is included in Other current liabilities
and accrued expenses as of December 31, 2016.

In July 2016, 2degrees and the Company completed a purchase of
all of the equity interests held individually or through related parties by a
minority shareholder in 2degrees (see Note 16  Noncontrolling Interests in
Consolidated Subsidiaries for further details). As part of this purchase,
2,250,000 equity-classified exercisable options were settled. Those options are
characterized as redeemed options in 2016 in the table above.

34

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

Total equity-based compensation for the 2degrees Option Plan,
net of forfeitures, of $2.7 million, $1.3 million and $1.9 million was
recognized in General and administrative expenses in the Consolidated Statement
of Operations and Comprehensive Loss for the years ended December 31, 2016,
2015, 2014, respectively.

As of December 31, 2016, the Company had total unrecognized
compensation costs related to the 2degrees Option Plan of $1.9 million. The
Company expects to recognize this cost over a weighted-average period of 1.3
years.

Restricted Class A Units:At December 31,
2016, the Company granted 1,725 Class A Units to an employee of the Company (the
Restricted Class A Units), which were all outstanding and unvested as of that
date. The value of the Class A Units was estimated based on the grant date fair
value as indicated by the completion of the Arrangement Agreement. The
Restricted Class A Units vest over 4 years, with one-fourth vesting on each
anniversary date of the award. There are no voting or dividends right prior to
vesting.

As of December 31, 2016, the Company had total unrecognized
compensation costs related to this award of $1.5 million. The Company expects to
recognize this cost over a weighted-average period of 4 years.

NOTE 14 EARNINGS PER UNIT

Basic and diluted earnings per unit are computed using the
two-class method, which is an earnings allocation method that determines
earnings per unit for member units and profit interest units. The undistributed
earnings are allocated between member units and profit interest units as if all
earnings had been distributed during the period. Member units and profit
interest units have equal rights to undistributed earnings. Profit interest
units do not participate in losses. As such, in the event of an operating loss,
the anti-dilutive profit interests and the Restricted Class A Units are excluded
from the participating units.

Basic earnings (loss) per unit is calculated by taking net
earnings (loss) attributable to Trilogy International Partners LLC, divided by
the basic weighted average units outstanding. The weighted average units
outstanding includes redeemable units recorded in mezzanine equity. In the event
of a net loss, the profit interest units are subtracted from the weighted
average units outstanding.

Diluted earnings (loss) per unit is calculated by taking net
earnings (loss) attributable to Trilogy International Partners LLC, divided by
the diluted weighted average units outstanding. In the event of a net loss, the
profit interest units are subtracted from the weighted average units
outstanding. As discussed above, anti-dilutive items are excluded from
consideration in the calculation.

Class A and B units are treated as one class as the rights,
obligations and income (loss) is allocated based on their respective unit
percentage. Class A and B units diverge in the voting rights associated with
each (see Note 12  Members Interest).

The following table presents the calculation of basic and
diluted net loss per unit attributable to Trilogy International Partners LLC (in
thousands, except unit and per unit amounts):

35

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

|                                                                                                  |   | Year Ended December 31, |  
|------------------------------------------------------------------------------------------------- | - | ----------------------- | -
|                                                                                                  |   | 2016                    |  
|                                                                                                  |   |                         |  
|Loss from continuing operations
      attributable to Trilogy International Partners LLC          | $ | (48,195                 | )
|                                                                                                  |   |                         |  
|Gain (loss) from discontinued operations
      attributable to Trilogy International Partners LLC |   | 50,303                  |  
|                                                                                                  |   |                         |  
|Net income (loss) attributable to Trilogy
      International Partners LLC                        | $ | 2,108                   |  
|                                                                                                  |   |                         |  
|Basic                                                                                             |   |                         |  
|                                                                                                  |   |                         |  
|Basic weighted average units outstanding                                                          |   | 356,424                 |  
|                                                                                                  |   |                         |  
|Less: weighted average Class C  profit
      interest units                                      |   | (12,981                 | )
|                                                                                                  |   |                         |  
|Basic weighted average units outstanding                                                          |   | 343,443                 |  
|                                                                                                  |   |                         |  
|Diluted                                                                                           |   |                         |  
|                                                                                                  |   |                         |  
|Basic weighted average units outstanding                                                          |   | 343,443                 |  
|                                                                                                  |   |                         |  
|Dilutive potential common
      shares(1)                                                         |   | -                       |  
|                                                                                                  |   |                         |  
|Diluted weighted average units outstanding                                                        |   | 343,443                 |  
|                                                                                                  |   |                         |  
|Net loss per unit from continuing
      operations:                                               |   |                         |  
|                                                                                                  |   |                         |  
|Basic                                                                                             | $ | (140.33                 | )
|                                                                                                  |   |                         |  
|Diluted                                                                                           | $ | (140.33                 | )
|                                                                                                  |   |                         |  
|Net earnings (loss) per unit from
      discontinued operations:                                  |   |                         |  
|                                                                                                  |   |                         |  
|Basic                                                                                             | $ | 146.47                  |  
|                                                                                                  |   |                         |  
|Diluted                                                                                           | $ | 146.47                  |  

(1)Diluted earnings per unit includes any dilutive
impact of profit interest units, stock options, restricted stock units,
performance-based restricted stock units and performance awards.

The Class C units are treated as profit interests, since they
do not participate in losses. Profits are shared across the unit holders based
on unit percentage across Class A, B and C units, once losses allocated to Class
A and B unit holders are recovered. The following table includes the weighted
average number of C units that may be dilutive in the future, upon the recovery
of historical losses allocated to the Class A and B unit holders:

|                                                                              |  | Year Ended December 31, | 
|----------------------------------------------------------------------------- |  | ----------------------- | 
|                                                                              |  | 2016                    | 
|                                                                              |  |                         | 
|Class C Units - profit interest units that
      do not participate in losses |  | 12,981                  | 
|                                                                              |  |                         | 
|Units excluded from calculation of diluted
      net earnings (loss)          |  | 12,981                  | 

36

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

NOTE 15  ACCUMULATED OTHER COMPREHENSIVE INCOME

A summary of the components of accumulated other comprehensive
income attributable to Trilogy International Partners LLC is presented
below:

|                                                                 |   |         |   |   | Cumulative  |   |   | Unrealized  |  
|---------------------------------------------------------------- | - | ------- | - | - | ----------- | - | - | ----------- | -
|                                                                 |   |         |   |   | Foreign     |   |   | Gains and   |  
|                                                                 |   |         |   |   | Currency    |   |   | Losses on   |  
|                                                                 |   |         |   |   | Translation |   |   | Derivative  |  
|                                                                 |   | Total   |   |   | Adjustment  |   |   | Instruments |  
|                                                                 |   |         |   |   |             |   |   |             |  
|December 31, 2014                                                | $ | 15,157  |   | $ | 17,287      |   | $ | (2,130      | )
|Other comprehensive (loss) income before
      reclassifications |   | (12,189 | ) |   | (12,189     | ) |   | -           |  
|Amounts reclassified from
      AOCI                             |   | 1,302   |   |   | -           |   |   | 1,302       |  
|Net current period other comprehensive income
      (loss)       |   | (10,887 | ) |   | (12,189     | ) |   | 1,302       |  
|                                                                 |   |         |   |   |             |   |   |             |  
|December 31, 2015                                                | $ | 4,270   |   | $ | 5,098       |   | $ | (828        | )
|Other comprehensive (loss)
      income before reclassifications |   | 1,171   |   |   | 1,171       |   |   | -           |  
|Amounts reclassified from AOCI                                   |   | 710     |   |   | -           |   |   | 710         |  
|Net current period other
      comprehensive income (loss)       |   | 1,881   |   |   | 1,171       |   |   | 710         |  
|                                                                 |   |         |   |   |             |   |   |             |  
|December 31, 2016                                                | $ | 6,151   |   | $ | 6,269       |   | $ | (118        | )

NOTE 16  NONCONTROLLING INTERESTS IN CONSOLIDATED
SUBSIDIARIES

Noncontrolling interests represent the equity ownership
interests in consolidated subsidiaries not owned by the Company. Noncontrolling
interests are adjusted for contributions, distributions, and income and loss
attributable to the noncontrolling interest partners of the consolidated
entities. Income and loss is allocated to the noncontrolling interests based on
the respective governing documents.

There are noncontrolling interests in certain of the Companys
consolidated subsidiaries. The noncontrolling interests are summarized as
follows:

|                                            |   | December 31, 2016 |   |   | December 31, 2015 |  
|------------------------------------------- | - | ----------------- | - | - | ----------------- | -
|                                            |   |                   |   |   |                   |  
|2degrees                                    | $ | 22,092            |   | $ | 19,059            |  
|NuevaTel                                    |   | 48,771            |   |   | 48,885            |  
|Salamanca Solutions
      International LLC |   | (316              | ) |   | (370              | )
|                                            |   |                   |   |   |                   |  
|Noncontrolling interests                    | $ | 70,547            |   | $ | 67,574            |  

In April 2015, the Company contributed capital to 2degrees at a
rate higher than its ownership percentage resulting in an increase of the
Company ownership in 2degrees. At the same time, pursuant to the terms of the
Snap purchase agreement, 2degrees issued shares of common stock to a
noncontrolling interest. These two transactions resulted in a 1.5% decrease in
the Companys ownership interest in 2degrees.

2Degrees Minority Interest Shareholder Transaction and
Share Repurchase:

In July 2016, 2degrees and the Company completed a purchase of
all of the equity interests held individually or through related parties by a
minority shareholder in 2degrees. The minority shareholder held ordinary shares,
convertible notes and vested employee partly paid options, all of which were
purchased for cash, in part by 2degrees and in part by the Company.

37

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

2degrees funded its redemption of equity interests from the
minority shareholder by issuing new shares, which were purchased by the Company.
The Company paid a total of $4.5 million for all the equity interests it
purchased directly from the minority shareholder, the newly issued shares it
acquired from 2degrees and the convertible notes transferred from the minority
shareholder. The amount of cash paid to acquire equity interest in 2degrees in
excess of the fair value of the related equity interest was $1.0 million which
was recorded and expensed in the period incurred. As a result of these
transactions, the Companys ownership percentage in 2degrees increased from
62.5% to 62.9% .

Supplemental Cash Flow Disclosure:

In the year ended December 31, 2014, the Company declared and
accrued a dividend to be paid to noncontrolling interest of $2.8 million. The
declared dividend was paid and recorded as a financing activity in the
Consolidated Statements of Cash Flows for the year ended December 31, 2015.

NOTE 17  COMMITMENTS AND CONTINGENCIES

Leases:Estimated future minimum lease
payments, utilizing current exchange rates at December 31, 2016, over the
estimated lease terms are summarized below:

Years Ending December 31,2017
    $
    17,8382018
    
    16,4132019
    
    15,6202020
    
    14,9772021
    
    14,428Thereafter
    
    70,891Total
    $
    150,167


Aggregate rental expense for all operating leases was $19.6
million, $16.2 million and $15.4 million for the years ended December 31, 2016,
2015 and 2014, respectively.

Commitments:

New Zealand:

Handsets

In October 2016, 2degrees signed a purchase agreement,
effective as of August 1, 2016, with a handset manufacturer that requires
2degrees to purchase a minimum number of handsets per quarter for three years
(beginning with the third quarter of 2016) for an estimated total obligation of
$341.0 million NZD ($235.9 million based on the exchange rate at December 31,
2016). As part of the purchase agreement, 2degrees has committed to allocate
$1.3 million NZD ($0.9 million based on the exchange rate at December 31, 2016)
of its advertising budget per contract year to related marketing. As of December
31, 2016 the approximate obligation outstanding for handset purchases under this
new purchase agreement, based on the exchange rate at that date, is set forth in
the table below. We have not reduced the commitment amounts in the table below
for potential rebates.

38

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

|Year ending December 31, |   |         | 
|------------------------ | - | ------- | 
|2017                     | $ | 56,717  | 
|2018                     |   | 80,786  | 
|2019                     |   | 48,350  | 
|                         |   |         | 
|Total                    | $ | 185,853 | 

Spectrum Licenses

On November 28, 2011, 2degrees accepted an offer from the New
Zealand Ministry of Economic Development to renew its 800/900 MHz spectrum
licenses effective November 25, 2022 through November 28, 2031. The price will
be calculated at the time of invoice based on adjustments for the Consumer Price
Index and other variables, but will not exceed $9.2 million, based on the
exchange rate at December 31, 2016. Payment will be due in 2022.

Huawei

As of December 31, 2016, 2degrees had an outstanding commitment
with Huawei for technical support and spare parts maintenance, software
upgrades, products, and professional services through the year 2019 in the
amount of $19.3 million.

The aggregate amounts of the aforementioned obligations to
Huawei outstanding as of December 31, 2016, based on the exchange rate at that
date, are as follows:

Years ending December 31,2017
    $
    5,5172018
    
    6,9102019
    
    6,910Total
    $
    19,337


2degrees also has submitted purchase orders to Huawei in the
amount of $1.9 million, based on the exchange rate at December 31, 2016, for
other equipment and services, which the Company expects to be fulfilled through
2017.

Tech Mahindra 2degrees has purchase commitments with
Tech Mahindra for ongoing information technology projects related to the
development of a new business support system. As of December 31, 2016, 2degrees
remaining purchase commitment totaled $5.8 million through 2017.

Other As of December 31, 2016, 2degrees has
remaining purchase commitments of $9.4 million with various vendors to acquire
hardware and software related to ongoing network and Information Technology
(IT) projects, as well as for IT support services, IT development, broadband
inventory, inventory distribution services, and operational reporting tools
through the year 2019 which are not significant individually.

Bolivia:

In December 2016, NuevaTel signed an agreement with Telefónica
Celular de Bolivia S.A. (Telecel) pursuant to which Telecel has agreed to
provide NuevaTel an Indefeasible Right to Use of its existing and future
capacity to transport national telecommunications data. This purchase commitment
expires in 2031. As of December 31, 2016, the minimum purchase commitment with
Telecel was as follows:

39

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

Years ending December 31,2017
    $
    6,7492018
    
    7,3702019
    
    1,5772020
    
    1,5772021
    
    1,577Thereafter
    
    15,770Total
    $
    34,620


In December 2011, NuevaTel signed an agreement with America
Móvil Peru S.A.C. (Claro) pursuant to which Claro has agreed to provide
NuevaTel international data telecommunications service through its existing and
future capacity in Peruvian territory on the border with Bolivia. This purchase
commitment expires in 2033. As of December 31, 2016, the minimum purchase
commitment with Claro was as follows:

Years ending December 31,2017
    $
    6032018
    
    9142019
    
    9142020
    
    9142021
    
    914Thereafter
    
    10,049Total
    $
    14,308


NuevaTel also has a purchase commitment with Nokia Siemens
Networks Oy (Nokia) for telecommunications equipment related to network
expansion as well as a support service agreement. As of December 31, 2016,
NuevaTels remaining purchase commitment with Nokia totaled $5.6 million through
2017.

In addition to the above, NuevaTel has remaining purchase
commitments of $17.2 million with various vendors to acquire telecommunications
equipment, support services, inventory and advertising through the year 2018
which are not significant individually.

Contingencies:General:

Trilogys international subsidiaries are subject to the laws
and regulations governing telecommunications services in effect in each of the
countries in which they operate. These laws and regulations can have a
significant influence on Trilogys results of operations and are subject to
change by the responsible governmental agencies. The financial statements
reflect certain assumptions based on laws, regulations and customary practices
currently in effect in each of the various countries. Trilogy cannot predict
what future laws and regulations might be passed or other event might occur that
could have a material effect on its investments or results of operations.
Further, certain of the countries in which Trilogy has investments have
experienced, or may experience, political and social instability. Trilogy
assesses the impact of significant changes in laws, regulations and political
stability on a regular basis and updates the assumptions and estimates used to
prepare its financial statements when deemed necessary.

In addition to issues specifically discussed elsewhere, the
Company is a party to various lawsuits, regulatory proceedings and other matters
arising in the ordinary course of business. Management believes that although
the outcomes of these proceedings are uncertain, any liability ultimately
arising from these actions should not have a material adverse impact on the
Companys financial condition, results of operations, or cash flows. The Company
has accrued for any material contingencies where the Companys management
believes the loss is probable and estimable.

40

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

Bolivian Regulatory Matters:

Under Bolivias telecommunications law, enacted on August 8,
2011, carriers must negotiate new licenses (to replace their existing
concessions) with the government. Although the law specifies, in compliance with
the Bolivian constitution, that carriers vested rights under their existing
concessions will be preserved, the Bolivian government may attempt to use its
powers under the new telecommunications law to impose burdensome obligations on
NuevaTel or seek to expand its ability to impose fines or revoke NuevaTels
license. The Bolivian regulatory authority, the Autoridad de Regulación y
Fiscalización de Telecomunicaciones y Transportes (ATT) issued a proposed
replacement contract template to NuevaTel in March 2016. NuevaTel has submitted
comments on the draft to the ATT in 2016. The ATT also recently renewed licenses
held by NuevaTels competitors and NuevaTel has been advised that these licenses
contain provisions based on the ATT template that was sent to NuevaTel. However,
the Company will not know precisely how the renewal process will affect NuevaTel
until NuevaTels license approaches its scheduled expiration in November 2019.

NuevaTels network experienced several outages or service
degradation events, notably in January 2015, August 2015 (two separate events),
October 2015, May 2016, June 2016, October 2016 (two separate events) and
January 2017 (four separate events). NuevaTel has voluntarily compensated the
customers affected by these outages and service degradations, except in cases
where service interruptions were minimal in scope. The ATT is investigating
several of these outages to determine if they were unforeseeable or if they
could have been avoided by NuevaTel. The Company is currently assessing its
exposure to possible regulatory sanctions. With respect to one of the August
2015 outages (in the town of San José de Chiquitos), the ATT has assessed a fine
against NuevaTel of $4.5 million. NuevaTel has appealed the ATTs decision to
Ministry of Public Works, Services and Housing (Public Works Ministry), the
regulators supervising entity, on grounds that the outage resulted from an
unforeseeable software malfunction and that, consequently, it should not be
subject to a significant fine. NuevaTel intends to contest the imposition of any
such fine vigorously, thus no amount has been accrued in our Consolidated
Balance Sheets.

In April 2013, the ATT notified NuevaTel that it proposed to
assess a fine of $2.2 million against NuevaTel for delays in making repairs to
public telephone equipment in several Bolivian cities in 2010. Based on the
information available to the Company, as of December 31, 2015, $0.2 million was
recorded as the probable loss amount. However, a decision by the Supreme Court
of Bolivia, dated July 13, 2016, authorized the ATT to collect any fine
confirmed by the Ministry of Public Services, notwithstanding the fact that the
fine might still be the subject of an appeal in the Bolivian courts. During the
latter part of 2016, the ATT began to collect fines based on this authorization
from the Bolivian Supreme Court. Thus, NuevaTel has increased its accrual during
the third quarter of 2016 to an accrual of $2.2 million, representing its
estimate of the most likely exposure as of December 31, 2016. NuevaTel will
continue to appeal the assessment of the $2.2 million fine.

In November 2016, the ATT published a communication indicating
that it may eliminate the 60-90 day expiration periods for unused airtime
credits. Based on further communications with government officials, the Company
now believes that refunds will not be pursued by the ATT. The Company will
continue to monitor additional communications from the ATT in this regard and
evaluate potential impacts, if any, on the Company.

NOTE 18  INCOME TAXES

For financial reporting purposes, (loss) income from continuing
operations before income taxes includes the following components:

|                                                          |   | Years Ended December 31, 2016 2015 2014 |  
|--------------------------------------------------------- | - | --------------------------------------- | -
|                                                          |   |                                        
|                                                          |   |                                         |  
|United States                                             | $ | (66,384                                 | )
|Foreign                                                   |   | 33,461                                  |  
|Loss from
      continuing operations before income taxes | $ | (32,923                                 | )

41

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

Income tax expense includes income and withholding taxes
incurred in New Zealand, Bolivia and the U.S. as follows:

|                         |   | Years Ended December 31, |  
|------------------------ | - | ------------------------ | -
|                         |   | 2016                     |  
|                         |   |                          |  
|Current:                 |   |                          |  
|U.S. Federal             | $ | 430                      |  
|Foreign                  |   | 11,162                   |  
|                         |   | 11,592                   |  
|Deferred and other:      |   |                          |  
|Foreign                  |   | (3,950                   | )
|                         |   | (3,950                   | )
|                         |   |                          |  
|Total income tax expense | $ | 7,642                    |  

The Companys taxable income or loss is taxed directly to its
members in accordance with their respective percentage ownership, therefore, no
provision or liability for U.S. federal income taxes, other than U.S. federal
withholding taxes, has been included in the financial statements. The Companys
subsidiaries, however, file income tax returns in their respective countries.
The statutory tax rates for 2degrees and NuevaTel for the year ended December
31, 2016 are 28% and 25%, respectively.

The reconciliation between the effective tax rates on income
from continuing operations to the U.S. federal statutory rate of zero percent is
as follows:

|                                                                       |   | Years Ended December 31, |  
|---------------------------------------------------------------------- | - | ------------------------ | -
|                                                                       |   | 2016                     |  
|                                                                       |   |                          |  
|Income tax expense (benefit) at foreign
      rates                    | $ | 9,190                    |  
|Change in valuation allowance                                          |   | (5,472                   | )
|Foreign withholding tax incurred                                       |   | 2,681                    |  
|Withholding taxes associated with unrepatriated foreign
      earnings |   | (38                      | )
|Inflation adjustment                                                   |   | (1,655                   | )
|Nondeductible adjustment                                               |   | 2,707                    |  
|Other - net                                                            |   | 229                      |  
|                                                                       |   |                          |  
|Total                                                                  | $ | 7,642                    |  

42

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TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

The components of deferred tax assets and liabilities are as
follows:

|                                                                       |   | December 31, 2016 |   |   | December 31, 2015 |  
|---------------------------------------------------------------------- | - | ----------------- | - | - | ----------------- | -
|                                                                       |   |                   |   |   |                   |  
|Intangible assets                                                      | $ | 1,539             |   | $ | 1,187             |  
|Fixed assets                                                           |   | 4,111             |   |   | 3,591             |  
|Bad debt allowance                                                     |   | 2,490             |   |   | 1,650             |  
|NOL carryforwards                                                      |   | 52,930            |   |   | 59,918            |  
|Accrued liabilities                                                    |   | 10,363            |   |   | 8,412             |  
|Inventory valuation                                                    |   | 1,114             |   |   | 1,144             |  
|Other                                                                  |   | 2,024             |   |   | 1,818             |  
|Subtotal                                                               | $ | 74,571            |   | $ | 77,720            |  
|Less: valuation allowance                                              |   | (57,244           | ) |   | (62,749           | )
|Total net deferred tax assets                                          | $ | 17,327            |   | $ | 14,971            |  
|                                                                       |   |                   |   |   |                   |  
|Intangible assets                                                      | $ | (517              | ) | $ | (2,695            | )
|Fixed assets                                                           |   | (8,753            | ) |   | (8,070            | )
|Withholding taxes associated with
      unrepatriated foreign earnings |   | (10,801           | ) |   | (10,840           | )
|Total deferred tax liabilities                                         | $ | (20,071           | ) | $ | (21,605           | )
|Net deferred tax liability                                             | $ | (2,744            | ) | $ | (6,634            | )

Subsequent to the issuance of the Consolidated Financial
Statements as of December 31, 2015, the Companys management identified certain
components of the deferred income tax balances that were inappropriately
excluded from the table above. The Company corrected the disclosure table for
the periods presented to include the balances previously omitted and changed the
recorded valuation allowance by the same amount. Additionally, this impacted the
change in valuation allowance and tax impact of certain permanent items
disclosed in the effective tax reconciliation. The corrections did not change
the reported net deferred tax liability balance or the total effective tax rate
previously reported. Management has concluded that these corrections were
immaterial to the Consolidated Financial Statement as a whole and had no impact
on the amounts previously reported in the Companys Consolidated Balance Sheets,
Statements of Operations and Comprehensive Loss or Statements of Cash Flows.

As of December 31, 2016, we have income tax NOL carryforwards
related to our international operations in New Zealand of approximately $189.0
million. Such tax losses carry forward indefinitely provided that shareholder
continuity requirements are met. The Arrangement Agreement completed on February
7, 2017 resulted in a recapitalization of the Companys members units. The
Company will continue to assess the recoverability of the New Zealand NOL
carryforwards based on shareholder continuity requirements.

Management assesses the need for a valuation allowance in each
tax paying component or jurisdiction based upon the available positive and
negative evidence to estimate whether sufficient taxable income will exist to
permit realization of the deferred tax assets. A significant piece of objective
negative evidence evaluated was the current and historical losses incurred in
New Zealand. Such objective evidence limits the ability to consider other
subjective evidence, such as our projections for future growth.

On the basis of this evaluation, as of December 31, 2016 a
valuation allowance of approximately $57.2 million has been recorded to
recognize only the portion of the deferred tax assets that are more likely than
not to be realized. The amount of the deferred tax assets considered realizable,
however, could be adjusted if estimates of future taxable income during the
carryforward period are reduced or increased or if objective negative evidence
in the form of cumulative losses is no longer present and additional weight is
given to subjective evidence such as our projections for growth.

43

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TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

We are subject to taxation in Bolivia, New Zealand and the
United States. As of December 31, 2016, the following are the open tax years by
jurisdiction:

|New Zealand   | 2011  2016
|------------- | -----------
|Bolivia       | 2012  2016
|United States | 2011  2016

Supplemental Cash Flow Disclosure:

|                                |   | Years Ended December 31, | 
|------------------------------- | - | ------------------------ | 
|                                |   | 2016                     | 
|                                |   |                          | 
|Income and withholding tax paid | $ | 19,608                   | 

NOTE 19  SEGMENT INFORMATION

We determine our reportable segments based on how our CEO, the
chief operating decision maker (CODM), regularly reviews our operations and
performance. Segment information is prepared on the same basis that our CODM
manages the segments, evaluates financial results, allocates resources, and
makes key operating decisions.

Trilogy operates two reportable segments identified by their
geographic regions:

- New Zealand  2degrees offers wireless voice and data communication
  services through both prepaid and postpaid payment plans with prepaid
  customers. With the acquisition of Snap in April 2015, 2degrees began to
  provide fixed broadband communications services to business and residential
  customers in New Zealand.
- Bolivia  NuevaTel offers voice and data services, including an array of
  services delivered via a short message service-based platform, to its mobile
  customers in Bolivia.

Our CODM evaluates and measures segment performance primarily
based on revenues and Adjusted EBITDA. Adjusted EBITDA represents income (loss)
from continuing operations before income taxes excluding amounts for (1)
interest expense; (2) depreciation, amortization and accretion; (3) equity-based
compensation (recorded as a component of General and administrative expense);
(4) Loss (gain) on disposal and abandonment of assets; and (5) all other
non-operating income and expenses. Adjusted EBITDA is a common measure of
operating performance in the capital-intensive telecommunications industry. We
believe Adjusted EBITDA is a key measure for internal reporting and used by
management to evaluate profitability and operating performance of our segments
and to allocate resources because it allows us to evaluate performance absent
non-operational factors that affect net income (loss). The presentation of
Adjusted EBITDA is not a measure of financial performance under GAAP and should
not be considered in isolation or as a substitute for consolidated net income
(loss) attributable to the Company, the most closely analogous GAAP measure.
Adjusted EBITDA is not defined in the same manner by all companies and may not
be comparable to other similarly titled measures of other companies unless the
definition is the same.

Revenue is attributed to regions based on where services are
provided. Segment results do not include any intercompany revenue. The
identifiable assets by segment disclosed in this note are those assets
specifically identifiable within each segment and include cash and cash
equivalents, net property, plant and equipment, goodwill, and other intangible
assets. Assets and capital expenditures not identified by reportable segment
below are associated with discontinued operations and corporate assets.
Corporate assets are primarily comprised of cash and cash equivalents available
for general corporate purposes, investments and assets of the corporate
headquarters. Expense and income items excluded from segment earnings are
managed at the corporate level. The accounting policies of the reportable
segments are the same as those described in Note 1  Description of Business,
Basis of Presentation and Summary of Significant Accounting Policies.

No customer accounts for more than 10% of our revenues.

44

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TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

The table below presents financial information for our
reportable segments and reconciles total segment Adjusted EBITDA to loss from
continuing operations before income taxes for the years ended December 31, 2016,
2015 and 2014:

|                                                          |   | For the fiscal year ended December 31, |  
|--------------------------------------------------------- | - | -------------------------------------- | -
|                                                          |   |                                        |  
|                                                          |   | 2016                                   |  
|                                                          |   |                                        |  
|Revenues                                                  |   |                                        |  
|                                                          |   |                                        |  
|New Zealand                                               | $ | 487,337                                |  
|Bolivia                                                   |   | 275,514                                |  
|Unallocated
      Corporate & Eliminations                |   | 565                                    |  
|                                                          |   |                                        |  
|Total revenues                                            | $ | 763,416                                |  
|                                                          |   |                                        |  
|Adjusted EBITDA                                           |   |                                        |  
|                                                          |   |                                        |  
|New Zealand                                               | $ | 79,291                                 |  
|Bolivia                                                   |   | 81,577                                 |  
|                                                          |   |                                        |  
|Equity-based compensation                                 |   | (2,706                                 | )
|Acquisition and other
      nonrecurring costs            |   | (4,225                                 | )
|Depreciation, amortization and accretion                  |   | (105,456                               | )
|Loss on disposal and
      abandonment of assets          |   | (609                                   | )
|Interest expense                                          |   | (69,055                                | )
|Debt modification costs                                   |   | (3,802                                 | )
|Other expense, net                                        |   | (133                                   | )
|Unallocated Corporate &
      Eliminations                |   | (7,805                                 | )
|                                                          |   |                                        |  
|Loss from continuing
      operations before income taxes | $ | (32,923                                | )
|                                                          |   |                                        |  
|Depreciation, amortization
      and accretion            |   |                                        |  
|New Zealand                                               | $ | 59,436                                 |  
|Bolivia                                                   |   | 45,981                                 |  
|Unallocated Corporate & Eliminations                      |   | 39                                     |  
|Total depreciation,
      amortization and accretion      | $ | 105,456                                |  
|                                                          |   |                                        |  
|Capital expenditures                                      |   |                                        |  
|New Zealand                                               | $ | 50,874                                 |  
|Bolivia                                                   |   | 56,342                                 |  
|Unallocated Corporate & Eliminations                      |   | 564                                    |  
|Total capital
      expenditures                          | $ | 107,780                                |  
|                                                          |   |                                        |  
|Total assets                                              |   |                                        |  
|New Zealand                                               | $ | 410,546                                |  
|Bolivia                                                   |   | 284,358                                |  
|Unallocated Corporate & Eliminations                      |   | 11,300                                 |  
|Total assets                                              | $ | 706,204                                |  

The table below presents total revenues by product or service
type for the years ended December 31, 2016, 2015 and 2014:

45

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

|                                      |   |             |  |   |         |  |   | Unallocated  |  |   |         | 
|------------------------------------- | - | ----------- |  | - | ------- |  | - | ------------ |  | - | ------- | 
|                                      |   |             |  |   |         |  |   | Corporate &  |  |   |         | 
|                                      |   | New Zealand |  |   | Bolivia |  |   | Eliminations |  |   | Total   | 
|                                      |   |             |  |   |         |  |   |              |  |   |         | 
|Year ended December 31, 2016          |   |             |  |   |         |  |   |              |  |   |         | 
|Wireless service revenues             | $ | 259,206     |  | $ | 265,534 |  | $ | -            |  | $ | 524,740 | 
|Wireline service revenues             |   | 43,397      |  |   | -       |  |   | -            |  |   | 43,397  | 
|Equipment sales                       |   | 173,150     |  |   | 5,622   |  |   | -            |  |   | 178,772 | 
|Non-subscriber ILD and other revenues |   | 11,584      |  |   | 4,358   |  |   | 565          |  |   | 16,507  | 
|Total revenues                        | $ | 487,337     |  | $ | 275,514 |  | $ | 565          |  | $ | 763,416 | 
|                                      |   |             |  |   |         |  |   |              |  |   |         | 
|Year ended December 31, 2015          |   |             |  |   |         |  |   |              |  |   |         | 
|Wireless service revenues             | $ | 229,365     |  | $ | 274,061 |  | $ | -            |  | $ | 503,426 | 
|Wireline service revenues             |   | 19,357      |  |   | -       |  |   | -            |  |   | 19,357  | 
|Equipment sales                       |   | 138,648     |  |   | 4,191   |  |   | -            |  |   | 142,839 | 
|Non-subscriber ILD and other revenues |   | 5,685       |  |   | 7,130   |  |   | 823          |  |   | 13,638  | 
|Total revenues                        | $ | 393,055     |  | $ | 285,382 |  | $ | 823          |  | $ | 679,260 | 
|                                      |   |             |  |   |         |  |   |              |  |   |         | 
|Year ended December 31, 2014          |   |             |  |   |         |  |   |              |  |   |         | 
|Wireless service revenues             | $ | 243,031     |  | $ | 286,432 |  | $ | -            |  | $ | 529,463 | 
|Equipment sales                       |   | 73,838      |  |   | 3,491   |  |   | -            |  |   | 77,329  | 
|Non-subscriber ILD and other revenues |   | 3,516       |  |   | 6,232   |  |   | 258          |  |   | 10,006  | 
|Total revenues                        | $ | 320,385     |  | $ | 296,155 |  | $ | 258          |  | $ | 616,798 | 

NOTE 20  RELATED PARTY TRANSACTIONS

Loan to Minority Shareholder of 2degrees:

In November 2010, in order to enable the Maori-owned
shareholder of 2degrees (the Maori Shareholder) to fund capital calls by
2degrees and thus maintain its minority stake in 2degrees, the Company and the
Maori Shareholder entered into agreements pursuant to which the Company made
loans to the Maori Shareholder. The loans accrued interest at a rate of 10.5%
per year and were payable quarterly in arrears. The loans were secured by the
shares of 2degrees acquired by the Maori Shareholder with the related loan
proceeds together with other 2degrees shares owned by the Maori Shareholder. In
August 2013, the Company and the Maori Shareholder entered into an amendment
whereby the Borrower was able to elect to pay in lieu of cash all or any portion
of the interest due and payable to the Company by transferring 2degrees shares
to the Company.

In August 2014, the Maori Shareholder transferred 11,101,917
2degrees shares to the Company in full repayment of the principal and interest
due and payable to the Company of $14.1 million. The difference between the
carrying value of the shares and the fair value of consideration transferred
resulted in a decrease to members interest of the Company. As a result of this
transfer, the Companys ownership interest in 2degrees increased 2.91% .
Interest income on the loan to the minority shareholder of 2degrees was $0.7
million for the year ended December 31, 2014.

46

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

Agreement between Trilogy and SHC:

On July 31, 2013, the Company entered into an agreement (the
Agreement) with (i) Salamanca Holding Company (SHC), a Delaware limited
liability company owned by Stewart Sherriff (then Trilogys Chief Technology
Officer and 2degrees interim Chief Executive Officer and now 2degrees Chief
Executive Officer), Richard A. Dunn Jr. (Trilogys former Chief Financial
Officer and a Trilogy employee through July 31, 2013) and Ian Beckett (a Trilogy
contractor through July 31, 2013), and (ii) each of these three individuals.
Pursuant to the Agreement, Trilogy transferred to SHC 80% of Trilogys interest
in its wholly owned subsidiary in exchange for 2,140 Class C Units of Trilogy
held by the three individuals.

Since 2008, Salamanca Solutions International LLC
(SSI) has licensed billing and customer relations management intellectual
property that it owned, known as Omega (the Omega IP), and associated software
support and development services, to the Companys subsidiaries in Bolivia, the
Dominican Republic and Haiti. These companies paid maintenance fees to SSI that
covered most of the operating costs of SSI. In 2012, Trilogy sold its Haitian
subsidiary (see Note 3  Discontinued Operations) and the acquirer did not
extend the maintenance agreement with SSI. The Company believes that SHC, as the
majority owner of SSI, intends to concentrate on locating new sources of revenue
from third party customers for the Omega IP and related software services that
SSI can provide. Trilogy, through a wholly owned subsidiary, holds an option to
acquire the Omega IP at nominal cost if SSI ceases business operations in the
future. Trilogy has the right to appoint one of four members of the SSI board of
directors and has certain veto rights over significant SSI business decisions.
The impact on our consolidated results related to SSI was a decrease to net loss
by $42 thousand and an increase to net loss by $0.6 million for the years ended
December 31, 2016 and 2015, respectively.

NOTE 21  SUBSEQUENT EVENTS

In preparing the financial statements, the Company has reviewed
all known events which have occurred after December 31, 2016 through March 27,
2017, the date on which the financial statements are available for issuance, for
potential recognition or disclosure in the consolidated financial statements and
footnotes.

Members contributionOn February 7, 2017, SG
Enterprise subscribed for additional Class A Units of Trilogy for which the
Company received $1.4 million.

Reverse Acquisition On February 7, 2017, the
Company and Trilogy International Partners Inc. (formerly Alignvest Acquisition
Corporation) (TIP Inc.) completed the court approved Arrangement Agreement.
TIP Inc. is listed on the Toronto Stock Exchange. In connection with the
completion of the Arrangement, Trilogys historical members units and profit
interest units were recapitalized into 157,339,668 Class A Units, 44,177,149
Class B Units and 39,334,917 Class C Units. To consummate the transaction, the
Company issued all the outstanding Class A Units and Class B Units to TIP Inc.
or a wholly-owned subsidiary thereof in exchange for substantially all the net
monetary assets of TIP Inc. As a result of this exchange, $199.3 million of cash
was received by the Company, net of $3.0 million cash retained by TIP Inc.,
along with other insignificant assets and liabilities. The number of Class B
Units will at all times be equal to the number of common shares of TIP Inc. The
Class C Units were issued to the legacy Company Members in exchange for the
previously outstanding member units. The Class C Units are subdivided into Class
C-1, C-2 and C-3 Units, each class subject to specific lock-up periods up to 24
months. Upon expiration of the lock-up period, the Class C Units can be redeemed
for cash at fair value or a number of Common Shares of TIP Inc. equal to the
number of Class C Units redeemed, the form of consideration to be determined by
the Company. As of February 7, 2017, TIP Inc.s economic interest in the Company
is approximately 53%.

For accounting purposes, the Arrangement was treated as a
reverse acquisition and recapitalization. The Company was considered the
accounting acquirer of TIP Inc. Accordingly, the Companys historical financial
statements as of period ends and for the periods ended prior to the acquisition
will become the historical financial statements of TIP Inc. prior to the date of
the acquisition. As of December 31, 2016, the Company has capitalized
approximately $6.7 million of transaction costs in Prepaid and Other Assets that
will be reclassified and offset against equity in the first quarter of 2017, in
accordance with the accounting guidance related to an equity transaction.

47

---

TRILOGY INTERNATIONAL PARTNERS LLCNOTES TO THE
CONSOLIDATED FINANCIAL STATEMENTS(US dollars in thousands unless
otherwise noted)

To give effect to the consummation of the Arrangement on
February 7, 2017, the Company, TIP Inc., TIP Inc.s wholly-owned subsidiary
Trilogy International Partners Holdings (U.S.) Inc., a Delaware corporation
(U.S. Holdings) and the legacy Company members entered into the Sixth Amended
and Restated Limited Liability Company Agreement of the Company (the Sixth LLC
Agreement). Immediately after consummation of the Arrangement, pursuant to the
amendment provisions of the Sixth LLC Agreement, the Company, TIP Inc., U.S.
Holdings and Trilogy International Partners Intermediate Holdings LLC, a
Delaware limited liability company (TIPIH) which is a wholly-owned subsidiary
of TIP Inc., entered into the Seventh Amended and Restated Limited Liability
Company Agreement of the Company (the Seventh LLC Agreement) in connection
with, and to give effect to, the transfer by TIP Inc. to TIPIH of all the
outstanding Class B Units of the Company. With the adoption of the Sixth LLC
Agreement and Seventh LLC Agreement, as of February 7, 2017, the pre-arrangement
Class A Unit redemption rights were eliminated and thus will be reclassified
from equity mezzanine to equity in the first quarter of 2017.

Subsequent increase in 2degrees ownershipIn
January 2017, the Company converted an outstanding intercompany loan balance
with 2degrees into ordinary shares of 2degrees. 10,920,280 shares of 2degrees
were issued to the Company in full repayment of the principal and interest due
and payable to the Company of $13.9 million. As a result of this transfer, the
Companys ownership interest in 2degrees increased by 1.0% from 62.9% to 63.9% .
Upon completion of the spectrum license payment on behalf of TIRS, as discussed
in Note 5  Goodwill, License Costs and Other Intangible Assets, and after
giving effect the above described loan conversion, Trilogy International
Partners LLC has $31.0 million of convertible loans receivable from its
subsidiaries.

Further, in connection with the completion of the Arrangement
Agreement on February 7, 2017, the Company indirectly acquired the interests of
noncontrolling shareholders in 2degrees. Upon completion of the Arrangement
Agreement, Trilogy currently indirectly holds 73.3% of 2degrees.

48

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